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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[X] Preliminary Proxy Statement
[ ] Preliminary Additional Materials
[ ] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Sec. 240.14a-11(e) or Sec. 240.14a-12
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(Name of Registrant as Specified In Its Charter) Fidelity Securities Fund
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(Name of Person(s) Filing Proxy Statement) Arthur S. Loring
Payment of Filing Fee (Check the appropriate box):
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[X] $125 per Exchange Act Rules 0-11(c)(ii), 14a-6(j) (1), or 14a-6(j) (2).
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule 14a-6(j) (3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(j) (4) and 0-11.
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(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:
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[ ] 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.
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(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
FIDELITY BLUE CHIP GROWTH FUND
FIDELITY DIVIDEND GROWTH FUND
FIDELITY GROWTH & INCOME PORTFOLIO
FIDELITY OTC PORTFOLIO
FUNDS OF
FIDELITY SECURITIES FUND
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 Blue Chip Growth Fund, Fidelity Dividend Growth Fund,
Fidelity Growth & Income Portfolio, and Fidelity OTC Portfolio (the
funds), will be held at the office of Fidelity Securities Fund (the trust),
82 Devonshire Street, Boston, Massachusetts 02109 on July 15, 1994, at
10:00 a.m. The purpose of the Meeting is to consider and act upon the
following proposals, and to transact such other business as may properly
come before the Meeting or any adjournments thereof.
1. To elect a Board of Trustees.
2. To ratify the selection of Coopers & Lybrand 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 approve a Sub-Advisory Agreement with FMR Far East for Fidelity Blue
Chip Growth Fund, Growth & Income Portfolio, and Fidelity OTC
Portfolio.
5. To approve a Sub-Advisory Agreement with FMR U.K. for Fidelity Blue
Chip Growth Fund, Fidelity Growth & Income Portfolio, and Fidelity OTC
Portfolio.
6. To approve an amended management contract for each fund.
7. To amend the Declaration of Trust regarding shareholder notification of
appointment of Trustees.
8. 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 with
substantially the same investment objective and policies.
9. To adopt a new fundamental investment policy for each fund permitting a
fund to invest all of its assets in another open-end investment company
with substantially the same objective and policies.
10. To amend Fidelity Growth & Income Portfolio's fundamental
investment objective and certain fundamental policies.
11. To replace certain of Fidelity OTC Portfolio's fundamental investment
policies with non-fundamental investment policies and eliminate certain
others.
12. To amend Fidelity OTC Portfolio's fundamental policy regarding
repurchase agreements.
13.To expand Fidelity Growth & Income Portfolio's and Fidelity OTC
Portfolio's fundamental policy concerning currency contracts.
14.To replace Fidelity Growth & Income Portfolio's and Fidelity OTC
Portfolio's fundamental investment limitation concerning diversification
with a fundamental diversification limitation permitting increased
investments in securities of any single issuer.
ADOPTION OF STANDARDIZED INVESTMENT LIMITATIONS
15.To amend the fundamental investment limitation concerning borrowing for
Fidelity Blue Chip Growth Fund, Fidelity Growth & Income Portfolio and
Fidelity OTC Portfolio.
16. To amend the fundamental investment limitation concerning real estate
for Fidelity Blue Chip Growth Fund, Fidelity Growth & Income Portfolio,
and Fidelity OTC Portfolio.
17. To amend the fundamental investment limitation concerning the issuance
of senior securities for Fidelity Blue Chip Growth Fund, Fidelity Growth
& Income Portfolio, and Fidelity OTC Portfolio.
18. To eliminate the fundamental investment limitation concerning short
sales of securities for Fidelity Blue Chip Growth Fund, Fidelity Growth
& Income Portfolio, and Fidelity OTC Portfolio.
19. To eliminate the fundamental investment limitation concerning margin
purchases for Fidelity Blue Chip Growth Fund, Fidelity Growth & Income
Portfolio, and Fidelity OTC Portfolio.
20. To amend the fundamental investment limitation concerning lending for
Fidelity Blue Chip Growth Fund, Fidelity Growth & Income Portfolio, and
Fidelity OTC Portfolio.
21. To amend Fidelity Blue Chip Growth Fund's fundamental investment
limitation concerning diversification.
22. To eliminate the fundamental investment limitation concerning
investment in other investment companies for Fidelity Growth & Income
Portfolio and Fidelity OTC Portfolio.
23. To adopt a fundamental investment limitation concerning commodities for
Fidelity Growth & Income Portfolio and Fidelity OTC Portfolio.
24. To amend Fidelity Blue Chip Growth Fund's fundamental investment
limitation concerning commodities.
25. To eliminate Fidelity Growth & Income Portfolio and Fidelity OTC
Portfolio's fundamental investment limitation concerning investing in oil,
gas, and other mineral exploration programs.
26. To amend Fidelity Blue Chip Growth Fund, Fidelity Growth & Income
Portfolio, and Fidelity OTC Portfolios' fundamental investment limitation
concerning the concentration of its investments in a single industry.
27. To eliminate the fundamental investment limitation concerning
restricted and illiquid securities for Fidelity Growth & Income
Portfolio and Fidelity OTC Portfolio.
28. To eliminate the fundamental investment limitation concerning
purchasing securities of an issuer in which the Trustees or directors or
officers of the funds or FMR hold more than 5% of the outstanding
securities of such issuer for Fidelity Growth & Income Portfolio and
Fidelity OTC Portfolio.
The Board of Trustees has fixed the close of business on May 18, 1994 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
May 18, 1994
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 TO THE FUNDS, 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 you avoid the time and expense to the funds 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 BLUE CHIP GROWTH FUND
FIDELITY DIVIDEND GROWTH FUND
FIDELITY GROWTH & INCOME PORTFOLIO
FIDELITY OTC PORTFOLIO
TO BE HELD JULY 15, 1994
This Proxy Statement is furnished in connection with a solicitation of
proxies made by, and on behalf of, the Board of Trustees of Fidelity
Securities Fund (the trust) to be used at the Special Meeting of
Shareholders of Fidelity Blue Chip Growth Fund, Fidelity Dividend Growth
Fund, Fidelity Growth & Income Portfolio, and Fidelity OTC Portfolio
(the funds) and at any adjournments thereof (the Meeting), to be held July
15, 1994 at 10:00 a.m. at 82 Devonshire Street, Boston, Massachusetts
02109, the principal executive office of the trust. 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 May 18, 1994. Supplementary solicitations may be made by
mail, telephone, telegraph, or by personal interview by representatives of
the trust. 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.
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. All proxies not
voted, including broker non-votes, will not be counted toward establishing
a quorum. 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.
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. A copy of each fund's
annual report for the fiscal year ended July 31, 1993 has been mailed or
delivered to shareholders of each respective fund entitled to vote at the
meeting.
Shares of each fund issued and outstanding as of March 31, 1994 are
indicated in the following table:
Fidelity Blue Chip Growth Fund __________
Fidelity Dividend Growth Fund __________
Fidelity Growth & Income Portfolio __________
Fidelity OTC Portfolio __________
To the knowledge of the trust, no other shareholder owned of record or
beneficially more than _% of the outstanding shares of any of the funds on
that date. Shareholders of record at the close of business on May 18, 1994
will be entitled to vote at the Meeting. Each such shareholder will be
entitled to one vote for each share held on that date.
VOTE REQUIRED: A PLURALITY OF ALL VOTES CAST AT THE MEETING IS
SUFFICIENT TO APPROVE PROPOSALS 1 AND 2. APPROVAL OF PROPOSALS 3
THROUGH 28 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), A "MAJORITY VOTE OF THE OUTSTANDING VOTING
SECURITIES'' MEANS THE AFFIRMATIVE VOTE OF THE LESSER OF (A) 67% OR MORE OF
THE SHARES OF THE FUND PRESENT AT THE MEETING OR REPRESENTED BY PROXY IF
THE HOLDERS OF MORE THAN 50% OF THE OUTSTANDING SHARES ARE PRESENT OR
REPRESENTED BY PROXY OR (B) MORE THAN 50% OF THE OUTSTANDING SHARES.
1. TO ELECT A BOARD OF TRUSTEES.
Pursuant to the provisions of the Declaration of Trust of Fidelity
Securities Fund, 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 Mrs. Davis, Mr. Mann, and Mr. Cox, all nominees named below are
currently Trustees of Fidelity Securities Fund and have served in that
capacity continuously since originally elected or appointed. Mr. Jones,
Mr. Lynch, and Mr. McDonough were selected by the trust's Nominating and
Administration Committee (see page 8) and were appointed to the Board in
May 1990, April 1990, and August 1989, respectively. None of the nominees
is 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, Fidelity
Management & Research Company (FMR, or the Adviser), or the funds'
distribution agent, Fidelity Distributors Corporation (FDC). Each of the
nominees is currently a Trustee or General Partner, as the case may be, of
other funds 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.
Year of
Nominee Election
(Age) Principal Occupation(s) or Appointment
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*J. Gary Burkhead Senior Vice President, is President of FMR; and President and a Director 1986
82 Devonshire Street of FMR Texas Inc. (1989), Fidelity Management & Research (U.K.)
Boston, MA Inc., and Fidelity Management & Research (Far East) Inc.
(53)
Ralph F. Cox President of Greenhill Petroleum Corporation (petroleum exploration and
200 Rivercrest Drive production, 1990). Prior to his retirement in March 1990, Mr. Cox was
Fort Worth, TX President and Chief Operating Officer of Union Pacific Resources
(62) Company (exploration and production). He is a Director of Bonneville
Pacific Corporation (independent power, 1989) and CH2M Hill Companies
(engineering). In addition, he served on the Board of Directors of the
Norton Company ( manufacturer of industrial devices, 1983-1990) and
continues to serve on the Board of Directors of the Texas State Chamber of
Commerce, and 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
P.O. Box 264 President of Corporate Affairs of Avon Products, Inc. She is currently a
Bridgehampton, NY Director of BellSouth Corporation (telecommunications), Eaton
(62) Corporation (manufacturing, 1991), and the TJX Companies, Inc. (retail
stores, 1990), and previously served as a Director of Hallmark Cards, Inc.
(1985-1991) and Nabisco Brands, Inc. In addition, she serves as a Director
of the New York City Chapter of the National Multiple Sclerosis Society,
and is a member of the Advisory Council of the International Executive
Service Corps. and the President's Advisory Council of The University of
Vermont School of Business Administration.
Richard J. Flynn Financial consultant. Prior to September 1986, Mr. Flynn was Vice 1982
77 Fiske Hill Chairman and a Director of the Norton Company (manufacturer of
Sturbridge, MA industrial devices). He is currently a Director of Mechanics Bank and a
(70) Trustee of College of the Holy Cross and Old Sturbridge Village, Inc.
*Edward C. Johnson 3d President, is Chairman, Chief Executive Officer and a Director of FMR 1968
82 Devonshire Street Corp.; a Director and Chairman of the Board and of the Executive
Boston, MA Committee of FMR; Chairman and a Director of FMR Texas Inc. (1989),
(64) 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 1990
3881-2 Lander Road Executive Officer of LTV Steel Company. Prior to May 1990, he was a
Chagrin Falls, OH Director of National City Corporation (a bank holding company) and
(66) National City Bank of Cleveland. He is a Director of TRW Inc. (original
equipment and replacement products), Cleveland-Cliffs Inc (mining),
NACCO Industries, Inc. (mining and marketing), Consolidated Rail
Corporation, Birmingham Steel Corporation, Hyster-Yale Materials
Handling, Inc. (1989) and RPM Inc. (manufacturer of chemical products,
1990). In addition, he serves as a Trustee of First Union Real Estate
Investments, Chairman of the Board of Trustees and a member of the
Executive Committee of the Cleveland Clinic Foundation, a Trustee and a
member of the Executive Committee of University School (Cleveland),
and a Trustee of Cleveland Clinic Florida.
Donald J. Kirk Professor at Columbia University Graduate School of Business and a 1987
680 Steamboat Road financial consultant. Prior to 1987, he was Chairman of the Financial
Apartment #1-North Accounting Standards Board. Mr. Kirk is a Director of General Re
Greenwich, CT Corporation (reinsurance) and Valuation Research Corp. (appraisals and
(61) valuations, 1993). In addition, he serves as Vice Chairmanof the Board of
Directors of the National Arts Stabilization Fund and Vice Chairman of the
Board of Trustees of the Greenwich Hospital Association.
*Peter S. Lynch Vice Chairman of FMR (1992). Prior to his retirement on May 31, 1990, 1990
82 Devonshire Street he was a Director of FMR (1989) and Executive Vice President of FMR (a
Boston, MA position he held until March 31, 1991); Vice President of Fidelity
(51) Magellan Fund and FMR Growth Group Leader; and a 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, 1989) 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 (1990).
Edward H. Malone Prior to his retirement in 1985, Mr. Malone was Chairman, General 1989
5601 Turtle Bay Drive Electric Investment Corporation and a Vice President of General Electric
#2104 Company. He is a Director of Allegheny Power Systems, Inc. (electric
Naples, FL utility), General Re Corporation (reinsurance), and Mattel Inc. (toy
(69) manufacturer). He is also a Trustee of Rensselaer Polytechnic Institute and
of Corporate Property Investors and a member of the Advisory Boards of
Butler Capital Corporation Funds and Warburg, Pincus Partnership Funds.
Marvin L. Mann Chairman of the Board, President, and Cheif Executive Officer of Lexmark
55 Railroad Avenue International, Inc. (office machines, 1991). Prior to 1991, he held positions
Greenwhich, CT of Vice President of International Business Machines Corporation ("IBM")
(61) and Preident 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 (1990).
Gerald C. McDonough Chairman of G.M. Management Group (strategic advisory services). Prior
135 Aspenwood Drive to his retirement in July 1988, he was Chairman and Chief Executive
Cleveland, OH Officer of Leaseway Transportation Corp. (physical distribution services).
(65) Mr. McDonough is a Director of ACME-Cleveland Corp. (metal working,
telecommunications and electronic products), Brush-Wellman Inc. (metal
refining), York International Corp. (air conditioning and refrigeration,
1989), Commercial Intertech Corp. (water treatment equipment, 1992),
and Associated Estates Realty Corporation (a real estate investment trust,
1993).
Thomas R. Williams President of The Wales Group, Inc. (management and financial advisory 1989
21st Floor services). Prior to retiring in 1987, Mr. Williams served as Chairman of
191 Peachtree Street, N.E. the Board of First Wachovia Corporation (bank holding company), and
Atlanta, GA Chairman and Chief Executive Officer of The First National Bank of
(65) 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. (1989), and
AppleSouth, Inc. (restaurants, 1992).
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** 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 March 31, 1994 the nominees and officers of the trust owned, in the
aggregate, less than __% of any of the funds' 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 vote of
two-thirds of the outstanding shares 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 six
non-interested Trustees, met eleven times during the twelve months ended
July 31, 1993. It is expected that the Trustees will meet at least ten
times a year at regularly scheduled meetings.
As a group, the non-interested Trustees received fees and expenses of
$50,000 from the trust in their capacities as Trustees of the funds for the
fiscal year ended July 31, 1993. The non-interested Trustees also served in
similar capacities for other funds advised by FMR (see page __, and
received additional compensation for such services.
The Board has adopted a policy whereby non-interested Trustees, upon
reaching their 72nd birthday, will resign. Under a defined benefit
retirement program, non-interested Trustees, upon reaching age 72, are
entitled to payments during their lifetime based on their basic Trustee
fees and their length of service.
The trust's Audit Committee is composed entirely of Trustees who are not
interested persons of the trust, or 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), Cox, and Jones are members of
the Committee. This Committee oversees and monitors the financial reporting
process, including recommending to the Board the independent accountants to
be selected for the trust (see proposal 2), reviewing internal controls and
the auditing function (both internal and external), reviewing the
qualifications of key personnel performing audit work, and overseeing
compliance procedures. During the twelve months ended July 31, 1993, the
Committee held ____ meetings.
The trust's Nominating and Administration Committee is currently composed
of Messrs. Flynn (Chairman), McDonough, and Williams. The Committee members
confer periodically and hold meetings as required. The Committee is charged
with the duties of reviewing the composition and compensation of the Board
of Trustees, proposing additional non-interested Trustees, monitoring the
performance of legal counsel employed by the funds and the non-interested
Trustees, and acting as administrative committee under the Retirement Plan
for non-interested Trustees. During the twelve months ended July 31, 1993
the Committee held ___ 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.
2. TO RATIFY THE SELECTION OF COOPERS & LYBRAND AS INDEPENDENT
ACCOUNTANTS OF THE TRUST.
By a vote of the non-interested Trustees, the firm of Coopers &
Lybrand has 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. 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 has
advised the trust that it has no direct or material indirect ownership
interest in the trust.
The services provided to the trust include (1) audit of annual financial
statements and, if requested, limited review of unaudited semiannual
financial statements; (2) assistance and consultation in connection with
SEC filings; and (3) review of the federal income tax returns filed on
behalf of the trust. 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 accountant's independence.
Representatives of Coopers & Lybrand 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 the trust (dollar-based voting)
rather than on the number of shares owned for all shareholder votes for the
fund. As a result, voting power would be allocated in proportion to the
value of each shareholder's investment.
BACKGROUND. Fidelity Blue Chip Growth Fund, Fidelity Dividend Growth Fund,
Fidelity Growth & Income Portfolio, and Fidelity OTC Portfolio are
funds of Fidelity Securities Fund, an open-end management investment
company organized as a Massachusetts business trust. Currently, there are
four funds in the trust. Each fund votes separately on matters concerning
only that fund and vote on a trust-wide basis on matters that affect 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 as required by the 1940 Act. In the case where a
trust has several series or funds, such as Fidelity Securities Fund, voting
rights may have become disproportionate since the net asset values per
share (NAV) of the separate funds diverge over time. The SEC has issued a
"no-action" letter permitting a trust to seek shareholder approval of a
dollar-based voting system. The proposed amendment complies with the
condition is stated in the no-action letter.
REASON FOR PROPOSAL. If approved, the amendment would provide a more
equitable distribution of voting rights than the one share, one-vote system
currently in effect for certain votes. The voting power of shareholders
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 each fund's net
aset value.
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Fund Name $1,000 investment in
Net Asset Value terms of shares
as of March 31, 1994 as of March 31, 1994
Fidelity Blue Chip Growth Fund $
Fidelity Growth & Income Portfolio $
Fidelity Dividend Growth Fund $
Fidelity OTC Portfolio $
</TABLE>
For example, Fidelity OTC Portfolio shareholders would have
approximately___% greater voting power then Fund Fidelity Blue Chip Growth
Fund shareholders, because at current NAVs a $1,000 investment in Fidelity
OTC Portfolio would equal ____ shares, whereas a $1,000 investment in Fund
Fidelity Blue Chip Growth would equal _____ shares. 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 is the result in a typical corporation where each
voting share 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 determines
the method of calculating voting rights for all shareholder votes for the
fund. 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 ... 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) 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. If approved, the amendment will take effect after the
shareholder meeting or any adjournments thereof. The Trustees believe the
proposed amendment will benefit the trust by bringing greater equality in
voting rights amongst all shareholders of the trust. The Trustees recommend
that shareholders vote FOR the proposed amendment to the Declaration of
Trust. If the proposed amendment is not approved, the Declaration of Trust
will remain unchanged.
4. TO APPROVE A SUB-ADVISORY AGREEMENT WITH FMR FAR EAST FOR FIDELITY BLUE
CHIP GROWTH FUND, FIDELITY GROWTH & INCOME PORTFOLIO, AND FIDELITY OTC
PORTFOLIO.
In conjunction with its portfolio management responsibilities on behalf of
each fund, FMR proposes to enter into sub-advisory agreements with
affiliates whose offices are geographically dispersed around the world. To
strengthen and coordinate these relationships, the Board of Trustees
proposes that shareholders of each fund approve a sub-advisory agreement
(the proposed agreement) between Fidelity Management & Research Company
(Far East) Inc. (FMR Far East) and FMR on behalf of each fund. The
proposed agreement would allow FMR not only to receive investment advice
and research services from FMR Far East, but also would permit FMR to grant
FMR Far East investment management authority, as well as the authority to
buy and sell securities, if FMR believes it would be beneficial to each
fund and its shareholders. BECAUSE FMR PAYS ALL OF FMR FAR EAST'S FEES, THE
PROPOSED AGREEMENT WOULD NOT AFFECT THE FEES PAID BY THE FUND TO FMR.
On March 17, 1994, the Board of Trustees agreed to submit the proposed
agreement to shareholders of each 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. A copy of the proposed agreement is attached
to this proxy statement as Exhibit __.
FMR Far East, with its principal office in Tokyo, is a wholly-owned
subsidiary of FMR established in 1986 to provide investment research to FMR
with respect to foreign securities. This research complements other
research on foreign securities produced by FMR's U.S.- based research
analysts and portfolio managers, or obtained from broker-dealers or other
sources.
FMR Far East may also provide investment advisory services to FMR with
respect to other investment companies for which FMR serves as investment
adviser, and to other clients. Currently, FMR Far East's only client other
than FMR is Fidelity International Limited (FIL), an affiliate of FMR
organized under the laws of Bermuda. 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 FMR
Far East, Chairman and a Director of FIL, and a principal stockholder of
both FIL and FMR. For more information on FMR Far East, see the section
entitled "Activities and Management of FMR U.K. and FMR Far East" on
page__.
Under the proposed agreement, FMR Far East would act as an investment
consultant to FMR and would supply FMR with investment research information
and portfolio management advice as FMR reasonably requests on behalf of
each fund. FMR Far East 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 FMR Far East, FMR, NOT EACH FUND, would pay FMR Far East's
fee equal to 105% of its costs incurred in connection with the agreement.
Under the proposed agreement, FMR could also grant investment management
authority with respect to all or a portion of each fund's assets to FMR Far
East. If FMR Far East were to exercise investment management authority on
behalf of a 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 each fund's
prospectus or other governing instruments and such other limitations as
each fund may impose by notice in writing to FMR or FMR Far East. If FMR
grants investment management authority to FMR Far East with respect to all
or a portion of a fund's assets, FMR Far East 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 FMR Far East, 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 each
fund), other transactions in futures contracts and options, and borrowing
or lending portfolio securities. If any of these investment management
services were delegated, FMR Far East 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 each fund. If
granted investment management authority, FMR Far East would also execute
orders to purchase and sell securities as described in the "Portfolio
Transactions" section on page ___.
Allowing FMR to grant investment management authority to FMR Far East
would provide FMR increased flexibility in the assignment of portfolio
managers and give each fund access to managers located abroad who may have
more specialized expertise with respect to local companies and markets.
Additionally, the Trustees believe that each fund and its shareholders may
benefit from giving FMR, through FMR Far East, the ability to execute
portfolio transactions from points in the Far East 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
each fund to participate more readily in full trading sessions on foreign
exchanges, and to react more quickly to changing market conditions.
THE PROPOSED AGREEMENT WOULD NOT INCREASE THE FEES PAID TO FMR BY EACH
FUND. To the extent that FMR granted investment management authority to
FMR Far East, FMR would pay FMR Far East 50% of its monthly management fee
with respect to the average net assets managed on a discretionary basis by
FMR Far East for investment management and portfolio execution services.
If approved by shareholders, the proposed agreement would take affect on
August 1, 1994 (or, if later, the first day of the first month following
approval) and would continue in force until July 31, 1995 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 each fund.
The proposed agreement could be transferred to a successor of FMR Far East
without resulting in termination and without shareholder approval, as long
as the transfer did not constitute an assignment under applicable
securities 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 unanimously recommends that shareholders
of each fund vote FOR the proposed agreement. If the proposed agreement is
not approved by shareholders of a fund, the Board and FMR will consider
alternative means of obtaining the investment services provided under the
Sub-Advisory Agreement.
5. TO APPROVE A SUB-ADVISORY AGREEMENT WITH FMR U.K. FOR FIDELITY BLUE CHIP
GROWTH FUND, FIDELITY GROWTH & INCOME PORTFOLIO, AND FIDELITY OTC
PORTFOLIO.
In conjunction with its portfolio management responsibilities on behalf of
each fund, FMR proposes to enter into sub-advisory agreements with
affiliates whose offices are geographically dispersed around the world. To
strengthen and coordinate these relationships, the Board of Trustees
proposes that shareholders of each fund approve a sub-advisory agreement
(the proposed agreement) between Fidelity Management & Research U.K.
Inc. (FMR U.K.) and FMR on behalf of each fund. The proposed agreement
would allow FMR not only to receive investment advice and research services
from FMR U.K., but also would permit FMR to grant FMR U.K. investment
management authority, as well as the authority to buy and sell securities
if FMR believes it would be beneficial to each fund and its shareholders.
Because FMR pays all of FMR U.K.'s fees, the proposed agreement would not
affect the fees paid by each fund to FMR.
On March 17, 1994, the Board of Trustees agreed to submit the proposed
agreement to shareholders of each 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. A copy of the proposed agreement is attached
to this proxy statement as Exhibit __.
FMR U.K., with its principal office in London, is a wholly-owned
subsidiary of FMR established in 1986 to provide investment research to FMR
with respect to foreign securities. This research complements other
research on foreign securities produced by FMR's U.S.-based research
analysts and portfolio managers, or obtained from broker-dealers or other
sources.
FMR U.K. may also provide investment advisory services to FMR with respect
to other investment companies for which FMR serves as investment adviser,
and to other clients. Currently, FMR U.K.'s only client other than FMR is
Fidelity International Limited (FIL), an affiliate of FMR organized under
the laws of Bermuda. 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 FMR U.K., Chairman, and a
Director of FIL, and a principal stockholder of both FIL and FMR. For more
information on FMR U.K., see the section entitled "Activities and
Management of FMR U.K. and FMR Far East" on page__.
Under the proposed agreement, FMR U.K. would act as an investment
consultant to FMR and would supply FMR with investment research information
and portfolio management advice as FMR reasonably requests on behalf of
[the/ each] fund. FMR U.K. would provide investment advice and research
services with respect to issuers located outside of the United States
focusing primarily on companies based in Europe. Under the proposed
agreement with FMR U.K., FMR, NOT EACH FUND, would pay FMR U.K.'s fee
equal to 110% of its costs incurred in connection with the agreement.
Under the proposed agreement, FMR could also grant investment management
authority with respect to all or a portion of each fund's assets to FMR
U.K. If FMR U.K. were to exercise investment management authority on behalf
of a 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 each fund's prospectus
or other governing instruments and such other limitations as each fund may
impose by notice in writing to FMR or FMR Far East. If FMR grants
investment management authority to FMR U.K. with respect to all or a
portion of [the/ a] fund's assets, FMR U.K. 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 FMR U.K., 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 each
fund), other transactions in futures contracts and options, and borrowing
or lending portfolio securities. If any of these investment management
services were delegated, FMR U.K. 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 each fund. If
granted investment management authority, FMR U.K. would also execute orders
to purchase and sell securities as described in the "Portfolio
Transactions" section on page ___.
Allowing FMR to grant investment management authority to FMR U.K. would
provide FMR increased flexibility in the assignment of portfolio managers
and give each fund access to managers located abroad who may have more
specialized expertise with respect to local companies and markets.
Additionally, the Trustees believe that each fund and its shareholders may
benefit from giving FMR, through FMR U.K., the ability to execute portfolio
transactions from points in Europe 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 each fund to
participate more readily in full trading sessions on foreign exchanges, and
to react more quickly to changing market conditions.
THE PROPOSED AGREEMENT WOULD NOT INCREASE THE FEES PAID TO FMR BY EACH
FUND. To the extent that FMR granted investment management authority to
FMR U.K., FMR would pay FMR U.K. 50% of its monthly management fee with
respect to the average net assets managed on a discretionary basis by FMR
U.K. for investment management and portfolio execution services.
If approved by shareholders, the proposed agreement would take affect on
August 1, 1994 (or, if later, the first day of the first month following
approval) and would continue in force until July 31, 1995 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 each fund.
The proposed agreement could be transferred to a successor of FMR U.K.
without resulting in termination and without shareholder approval, as long
as the transfer did not constitute an assignment under applicable
securities 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 unanimously recommends that shareholders
of each fund vote FOR the proposed agreement. If the proposed agreement is
not approved by shareholders of a fund, the Board and FMR will consider
alternative means of obtaining the investment services provided under the
Sub-Advisory Agreement.
6. TO APPROVE AN AMENDED MANAGEMENT CONTRACT FOR EACH FUND.
The Board of Trustees has approved, and recommends that shareholders of
each fund approve, a proposal to amend each fund's management contract with
FMR (the Amended Contract). The proposal would modify 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 CONTRACT WILL
RESULT IN A MANAGEMENT FEE WHICH IS THE SAME AS, OR LOWER THAN, THE FEE
PAYABLE UNDER THE PRESENT MANAGEMENT CONTRACT (THE PRESENT CONTRACT).
PROPOSED AMENDMENT TO THE PRESENT MANAGEMENT CONTRACT. A copy of the
Amended Contract, marked to indicate the proposed amendment, is supplied as
Exhibit 1 for Fidelity OTC Portfolio and Fidelity Blue Chip Growth Fund and
as Exhibit 2 for Fidelity Growth & Income Portfolio and Fidelity
Dividend Growth Fund beginning on page __. Except for the amendment to the
management fee it is substantially identical to the Present Contract. (For
a detailed discussion of the funds' Present Contracts, refer to the section
entitled "Present Management Contract" beginning on page .) If approved
by shareholders, the Amended Contract will take effect on August 1 , 1994
(or, if later, the first day of the first month following approval) and
will remain in effect through July 31, 1995 and thereafter subject to
continuation by each fund's Board of Trustees. If the Amended Contract is
not approved, the Present Contract will continue in effect through July 31
, 1995 , and thereafter subject to continuation by the fund's Board of
Trustees.
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. As group net assets increase, the group fee
rate declines. The Amended Contract would not change the group fee
calculation for group net assets of $138 billion ($228 for Dividend Growth
Fund) or less. Above $138 billion ($228 for Dividend Growth Fund) in
group net assets, the group fee rate does not decline under the Present
Contract, but under the Amended Contract, it declines as indicated in the
table below. These lower fee rates were voluntarily implemented by FMR on
January 1, 1992, and November 1, 1993.
The group fee rate is calculated according to a graduated fee schedule
providing for different rates for different levels of group net assets. The
rate at which the fee declines is determined by fee "breakpoints" that
provide for lower fees when assets increase. The Amended Contract would add
four new fee breakpoints (three for Dividend Growth) for group asset levels
above $138 billion ($174 for Dividend Growth) as illustrated in the table
below. (For an explanation of how these breakpoints are factored into the
fee calculation, see the section entitled "Present Management Contract"
beginning on page ___.)
GROUP FEE RATE SCHEDULE
Average Group Present Amended
Assets Contract* Contract
($ billions)
102-138 .3100% .3100%
138-174 .3100% .3050%
174-228 .3100% .3000%
228-282 .3100% .2950%
282-336 .3100% .2900%
Over 336 .3100% .2850%
The result at various levels of group net assets is illustrated by the
table below.
EFFECTIVE ANNUAL GROUP FEE RATES
Group Net Present Amended
Assets Contract* Contract
($ billions)
215 .3292% .3264%
250 .3265% .3223%
300 .3238% .3175%
350 .3218% .3133%
400 .3203% .3098%
* Does not reflect voluntary adoption of extended group fee rate schedules
by FMR on January 1, 1992 and November 1,1993.
Average group net assets for March 1994 were approximately $253 billion.
Each fund's annual individual fund fee rate is .30% Blue Chip Growth Fund,
.30% Dividend Growth Fund, .20%, Growth & Income Portfolio, and .35%
OTC Portfolio. The sum of the group fee rate and the individual fund fee
rate is referred to as a fund's basic fee rate [for fund that does not have
performance adjustment: management fee rate.]. One-twelfth (1/12) of this
annual (management fee: Growth & Income Portfolio) basic fee rate is
applied to the fund's average net assets for the current month, resulting
in a dollar amount which is the (management fee: Growth & Income
Portfolio) basic fee for that month.
Fidelity Blue Chip Growth Fund, Fidelity Dividend Growth Fund, and
Fidelity OTC Portfolio: The basic fee is subject to an upward or downward
adjustment, depending on whether the fund's investment performance exceeds
or is exceeded by the Standard & Poor's 500 Composite Stock Price Index
(S&P 500); (Fidelity Blue Chip Growth Fund and Fidelity Dividend Growth
Fund) or the NASDAQ Index (the Index); (Fidelity OTC Portfolio) over the
same period. The performance period consists of the most recent month plus
the previous 35 months. Each percentage point of difference (up to a
maximum difference of + 10) 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 of
this rate is applied to the average daily net assets for the fund over the
entire performance period, giving a dollar amount which is added to or
subtracted from the basic fee.
COMPARISON OF MANAGEMENT FEES AND TOTAL EXPENSES. For March 1994 average
group net assets of $253 billion, the fund's (management fee: Growth
& Income Portfolio) basic fee rate under the Amended Contract would
have been __%, compared to __% under the Present Contract. The (management
fee: Growth & Income Portfolio) basic fee rate will remain the same
under both the Present Contract and the Amended Contract until group net
assets exceed $___ billion, at which point the (management fee: Growth
& Income Portfolio) basic fee rate under the Amended Contract begins to
decline. The following chart compares the each fund's management fee ( For
Fidelity Blue Chip Growth Fund, Fidelity Dividend Growth Fund, and Fidelity
OTC Portfolio: including the Performance Adjustment) and total expense
ratio under the terms of the Present Contract for the fiscal year ended
July 31, 1993 to the fees and expenses the fund would have incurred if the
Amended Contract had been in effect.
<TABLE>
<CAPTION>
<S> <C>
CURRENT CONTRACT MODIFIED CONTRACT
</TABLE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
Management Total Expense Management Total Expense
Fee Ratio Fee Ratio
Fidelity Blue Chip
Growth Fund $ % $ %
Fidelity Dividend
Growth Fund* $ % $ %
Fidelity Growth & Income
Portfolio $ % $ %
Fidelity OTC Portfolio
$ % $ %
</TABLE>
* From April 28, 1993 (commencement of operations) through July 31, 1993.
MATTERS CONSIDERED BY THE BOARD OF TRUSTEES. The non-interested Trustees
recommended in 1991, and again in 1993, that the existing group fee be
reconsidered in light of the significant growth in the assets of funds
advised by FMR.
FMR provided substantial information to the Trustees to assist it in its
deliberations. In addition, the Committee requested and reviewed additional
data, including analyses prepared by independent counsel to both the funds
and the non-interested Trustees. In unanimously approving the proposed
contract and recommending its approval by shareholders, the Trustees of the
fund, including the Independent Trustees, considering the best interests of
shareholders of the fund, took into account all factors they deemed
relevant. The factors considered by the Independent Trustees included the
nature, quality, and extent of the services furnished by FMR to the fund;
the necessity of FMR maintaining and enhancing its ability to retain and
attract high caliber personnel to serve the fund; the increased complexity
of the domestic and international securities markets; the investment record
of FMR in managing the fund; extensive financial, personnel, and structural
information as to the Fidelity organization, including the revenues and
expenses of FMR, and Fidelity Service Co. (FSC, the funds' transfer,
shareholder servicing, and pricing and bookkeeping agent) relating to their
mutual fund activities; whether economies of scale were demonstrated in
connection with FMR's provision of investment management and shareholder
services as assets increased; data on investment performance, management
fees and expense ratios of competitive funds and other Fidelity funds;
FMR's expenditures in developing enhanced shareholder services for the
fund; enhancements in the quality and scope of the shareholder services
provided to the fund's shareholders; the fees charged and services offered
by an affiliate of FMR for providing investment management services to
non-investment company accounts; and possible "spin-off" benefits to FMR
from serving as manager and from affiliates of FMR serving as principal
underwriter and transfer agent of the funds.
CONCLUSION, ACTION OF THE BOARD OF TRUSTEES, AND RECOMMENDED SHAREHOLDER
ACTION. Based on its evaluation of the extensive materials presented and
assisted by the advice of independent counsel, the Board of Trustees
concluded (i) that the existing management fee rate structure was fair and
reasonable and (ii) that the proposed reduction in the group fee rate
structure was in the best interest of each fund's shareholders. The Board
of Trustees voted to approve the submission of the Amended Contract to
shareholders of the fund and recommends that shareholders of the funds vote
FOR the Amended Contract.
7. 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
outstanding shareholders 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 also 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. An appointment in this case would also require
shareholder notification within three months of the appointment under the
current Declaration of Trust.
Subject to shareholder approval, the Trustees intend 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
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 proposed
elimination of the Declaration of Trust's shareholder notification
requirement in the event of an appointment of a Trustee is in the best
interests of the trust's shareholders. The Trustees recommend voting FOR
the proposed amendment. If the proposal is not approved, the Declaration of
Trust's current section entitled "Resignation and Appointment of Trustees"
will remain unchanged.
8. 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 WITH
SUBSTANTIALLY THE SAME INVESTMENT OBJECTIVE AND POLICIES.
The Board of Trustees has approved, and recommends that shareholders of
the fundS 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
with substantially the same investment objective and policies ("Pooled Fund
Structure"). The purpose of the Pooled Fund Structure is to achieve
operational efficiencies by consolidating portfolio management while
maintaining different distribution and servicing structures. In order to
implement a Pooled Fund Structure, both the Declaration of Trust and the
fundS' policies must permit the structure. Currently, each fund's policies
do not allow for such investments. Proposal 9 on page __ seeks each fund's
shareholder approval 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 Pooled Fund Structure if A fund's policies permit it.
BACKGROUND. A number of mutual funds have developed structures under which
several funds invest all of their assets in a single pooled investment.
For example, an institutional equity fund with a high initial minimum
investment amount for large investors might pool its investments with a
retail equity fund designed for investors with lower minimums. This
structure allows several funds with substantially the same objective but
different distribution and servicing features to combine their investments
and manage them as one pool instead of managing them separately. The funds
combine their investments by investing all of their assets in one pooled
fund which would be organized as an open-end management investment company
(mutual fund). (Each fund invested in a single pooled investment retains
its own characteristics, but is able to achieve operational efficiencies
through investing together with the other funds in the Pooled Fund
Structure.) The current Declaration of Trust does not specifically provide
the Trustees the ability to authorize the Pooled Fund Structure.
REASON FOR THE PROPOSAL. FMR and the Board of Trustees continually
reviews 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 Pooled 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 Pooled Fund Structure is permitted
under the fund's investment policies (see Proposal 9) and if they determine
that a Pooled 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 the fund or its shareholders. Although
the current Declaration of Trust does not contain any explicit prohibition
against implementing a Pooled Fund Structure, the specific authority is
being sought in the event the Trustees deem it appropriate to adopt a
Pooled 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 Trustees believe the proposed amendment will benefit the
fundS by providing the Trustees with the flexibility to adopt a Pooled Fund
Structure in the future if permitted by a fund's investment policies and if
the Trustees determine it to be in the best interest of the fund. The
Trustees recommend that shareholders vote FOR the proposed amendment to the
Declaration of Trust. If approved, the amendment to the Declaration of
Trust will take effect immediately after the shareholder meeting or any
adjournments thereof. If the proposal is not approved, Article V, Section 1
of the Declaration of Trust will remain unchanged.
9. TO ADOPT A NEW FUNDAMENTAL INVESTMENT POLICY FOR EACH FUND PERMITTING A
FUND TO INVEST ALL OF ITS ASSETS IN ANOTHER OPEN-END INVESTMENT COMPANY
WITH THE SUBSTANTIALLY THE SAME OBJECTIVE AND POLICIES.
The Board of Trustees has approved, subject to a shareholder vote, the
adoption of a new fundamental investment policy that would permit each fund
to invest all of its assets in another open-end investment company with
substantially the same investment objective and policies ("Pooled Fund
Structure"). The purpose of pooling 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 structures under
which several funds invest all of their assets in a single pooled
investment. In order to implement a Pooled Fund Structure, both the
Declaration of Trust and a fund's policies must permit the structure.
Proposal (8), which proposes to amend the Declaration of Trust, if
approved, would allow the Trustees to authorize the conversion to a Pooled
Fund Structure if permitted by a fund's policies. This proposal would add
a fundamental policy for each fund that permits a Pooled Fund Structure.
PURPOSE OF 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 a fund
should invest in a Pooled Fund, the Trustees believe it could be in the
best interests of each fund to adopt such a structure at a future date.
At present, certain of each fund's fundamental investment policies and
limitations would prevent a fund from investing all of its 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 each fund's assets to be invested in a single Pooled Fund,
without a further vote of shareholders, if the Trustees determine that
action to be in the best interests of a fund and its shareholders.
Approval of Proposal (8) provides the Trustees with explicit authority to
approve a Pooled Fund Structure. If shareholders approve this proposal,
certain fundamental and non-fundamental policies and limitations of each
fund that currently prohibit investment in shares of one investment company
would be modified to permit the investment in a Pooled Fund. These
policies include each fund's limitations on diversification, industry
concentration, 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 Pooled Fund
Structure would facilitate the introduction of new Fidelity mutual funds,
increasing the investment options available to shareholders.
Each fund's method of operation and shareholder services would not be
materially affected by its investment in a Pooled Fund, except that the
assets of a fund would be managed as part of a larger pool. Were a fund to
invest all of its assets in a Pooled Fund, it would hold only a single
investment security, and the Pooled Fund would directly invest in
individual securities pursuant to its investment objective. The Pooled
Fund would be managed by FMR or an affiliate, such as FMR Texas in the case
of a money market fund. The Trustees would retain the right to withdraw a
fund's investments from a Pooled Fund at any time and would do so if the
Pooled Fund's investment objective and policies were no longer appropriate
for the fund. The fund would then resume investing directly in individual
securities as it does currently.
Whenever a fund is asked to vote at a shareholder meeting of the Pooled
Fund, the fund will hold a meeting of its shareholders if required by
applicable law or the fund's policies. The fund will cast its votes at the
Pooled Fund meeting in the same proportion as the fund's shareholders voted
at theirs. The fund would otherwise continue its normal operations.
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 Pooled Fund only if they determine that pooling is in
the best interests of the fund and if, upon advice of counsel, they
determine that the investment will not have material adverse tax
consequences to the fund or its shareholders. In determining whether to
invest in a Pooled 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 Pooled Fund if doing so
would materially increase costs to shareholders.
FMR intends to seek federal and state regulatory approval in order to
allow the Fidelity funds to invest in Pooled Funds. There is, of course,
no assurance that all necessary regulatory approvals will be obtained, or
that cost reductions or increased efficiencies will be achieved.
FMR may benefit from the use of a Pooled Fund if overall assets are
increased (since FMR's fees are based on assets). Also, FMR's expenses of
providing investment and other services to each fund may be reduced. If a
fund's investment in a Pooled 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 Pooled Fund structure is
implemented.
PROPOSED FUNDAMENTAL POLICY. To allow each fund to invest in a Pooled
Fund at a future date, the Trustees recommend that each 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 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 each fund 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 with substantially the
same fundamental investment objective, policies, and limitations as the
fund."
CONCLUSION. The Board of Trustees recommends that each fund's
shareholders vote to adopt a new fundamental policy that would permit each
fund, subject to future review by the Board of Trustees as described above,
to invest all of its assets in an open-end investment company with
substantially the same fundamental investment objective, policies, and
limitations as the fund. If the proposal is not adopted each fund's current
fundamental investment policies will remain unchanged with respect to
potential investment in Pooled Funds.
10. TO AMEND FIDELITY GROWTH & INCOME PORTFOLIO'S FUNDAMENTAL
INVESTMENT OBJECTIVE AND CERTAIN FUNDAMENTAL POLICIES.
The Board of Trustees has approved, and recommends that shareholders
approve, modifications to the fund's investment objective and policies that
would eliminate the reference to "growth of income" in the fund's objective
and policies and provide the fund with more flexibility in seeking to
achieve its objective. Adoption of the proposed objective and policies is
not expected to materially affect the way in which the fund is managed, the
investment performance of the fund, or the securities or instruments in
which the fund invests, but will provide FMR with more flexibility in
selecting the investments for the fund.
CURRENT OBJECTIVE AND POLICIES. The fund's current fundamental objective
provides that the fund seeks:
"long-term growth of capital, current income, and growth of income,
consistent with reasonable investment risk." In addition, the fund the
following fundamental policies: "FMR will pursue the fund's objective by
investing its assets in securities of companies that offer growth potential
while paying current dividends. FMR will generally sell securities of
companies for which dividends fall to a level lower than the yield of the
S&P 500. It is expected that the primary fixed income investments
that the fund will make will be in corporate bonds. The fund expects to
invest primarily in securities currently paying dividends, although it may
buy securities that are not paying dividends, but offer prospects for
growth of capital or future income."
DISCUSSION OF PROPOSED CHANGES. The Trustees recommend that the fund's
objective be modified to delete the reference to "growth of income". If the
proposal is approved, the fund's objective will be replaced with the
following fundamental objective:
"The fund seeks high total return through a combination of current income
and capital appreciation."
FMR believes that the fund could more readily provide a combination of
growth and income to shareholders if its objective focused solely on these
two goals, rather than also include growth of income. Growth of income may
not be consistent with long-term growth of capital and current income in
all market environments, particularly in some foreign markets.
The fund's Trustees also intend to replace the fund's fundamental policies
with the following non-fundamental policies, which could be changed in the
future without further approval of shareholders:
"The fund may invest in any type of equity or debt securities in pursuit
of its objective. The fund expects to invest a majority of its assets in
equity securities, with a focus on those that pay current dividends and
show potential earnings growth. However, the fund may buy securities that
are not currently paying dividends, but offer prospects for capital
appreciation or future income."
The proposed changes to the fund's objective and policies would allow the
fund to invest in all types of securities in search of long-term growth of
capital and current income without imposing limits on the types of eligible
investments. If the Proposal is approved, the fund expects to invest a
majority of its assets in equity securities, although it will be able to
invest in any type of equity or debt instrument. It will no longer be
required to have its primary fixed-income instruments be corporate bonds,
but will have the flexibility to invest more significantly in government
bonds if FMR believes they would be consistent with the fund's objective.
Although the fund anticipates that its yield will be greater than the
S&P 500, it will no longer be generally required to sell a securities
with a lower yield.
The proposed amendment to the fund's objective and policies is not
expected to materially affect the investments of the fund: however, it will
provide FMR with more flexibility in selecting the types and mix of the
fund.
CONCLUSION. The Board of Trustees believes that the proposed modifications
to the fund's investment objective and policies are in the best interests
of the fund and its shareholders, and unanimously recommends that
shareholders vote FOR the Proposal. If the Proposal is not approved, the
fund's fundamental objective and policies will remain unchanged.
11. TO REPLACE CERTAIN OF FIDELITY OTC PORTFOLIO'S FUNDAMENTAL INVESTMENT
POLICIES WITH NON-FUNDAMENTAL INVESTMENT POLICIES AND ELIMINATE CERTAIN
OTHERS.
The Board of Trustees has approved a proposal that would replace certain
of the fund's fundamental investment policies with non-fundamental
investment policies and eliminate certain others. The main purpose of this
proposal is to give the fund greater flexibility in the choice and
management of its investments in pursuing its objective of seeking capital
appreciation by investing in securities traded in the over-the-counter
securities market. While it is not currently anticipated that these changes
would have any material impact on the way the fund is managed, approval of
this proposal would permit the fund to change its policies regarding the
types of securities it purchases, consistent with its investment objective,
subject only to the supervision of the Trustees and applicable regulatory
requirements, without seeking additional approval from shareholders. The
fund's fundamental investment objective - to seek capital appreciation -
will remain the same, and will not be changed in the future without
shareholder approval.
Currently, the fund's fundamental policies provide that 1) at least 65% of
the fund's assets will be invested in securities traded in the
over-the-counter (OTC) securities market; 2) the fund may hold, for up to
six months, securities that were traded only on the OTC securities market
when purchased but which have since been listed on the New York Stock
Exchange or American Stock Exchange; or a foreign exchange, and may
consider that these securities fall within the fund's 65% limitation; and
3) the fund may invest up to 30% of its assets in foreign securities. The
proposal would eliminate these fundamental policies and replace them with
the following non-fundamental policy:
"FMR, the fund's manager, will normally invest at least 65% of the fund's
total assets in securities that are traded in the over-the-counter market.
Companies which have been listed on the New York Stock Exchange (NYSE) or
American Stock Exchange (ASE) or a foreign exchange after purchase continue
to be considered OTC securities for purposes of the name test."
Fundamental investment policies can be changed only with the approval of
shareholders, while non-fundamental policies can be changed or eliminated
without shareholder approval. However, changes in investment policies would
continue to be subject to the supervision of the Board of Trustees, and to
appropriate disclosure to fund shareholders and prospective investors.
Currently, the fund is allowed to continue to treat securities as "OTC
securities" for a period of six months after the security begins trading on
an exchange. Eliminating the six-month limit is not expected to
substantially affect the fund's portfolio, but will enable FMR to hold
securities for a longer period of time in order to realize FMR's
longer-term-value projections. In addition, the 65% limit will now apply
to the fund's total assets in order to conform with the current SEC
requirements.
In addition, as a fundamental policy, the fund may not invest more than
30% of its assets in foreign securities. FMR believes that this policy
restricts the fund from investing in securities which represent a
significant portion of the universe of available securities. The fund
will continue to invest in securities on the basis of capital appreciation.
The fund is permitted to invest in equity securities and debt securities
of any quality in seeking its objective, and its foreign investments could
therefore include securities of emerging governments with poor credit
standing. Emerging markets have been characterized by substantial
volatility, and emerging market securities have generally offered
significant potential for depreciation as well as appreciation. As compared
to U.S. government debt, foreign government securities are generally of
lower quality; however, as compared to foreign corporate debt, foreign
government debt may be of higher credit quality and more liquid due to more
active trading markets.
CONCLUSION. The fund does not expect that the proposed changes will
materially alter the manner in which the fund is currently managed but will
provide it with additional flexibility to respond to changes in regulation
and market conditions in the future. The Trustees recommend that
shareholders vote FOR the proposal. The new investment policies, upon
shareholder approval, will become effective immediately. If the proposal is
not approved, the fund's current investment policies will remain unchanged.
12. TO AMEND FIDELITY OTC PORTFOLIO'S FUNDAMENTAL POLICY CONCERNING
REPURCHASE AGREEMENTS.
The fund, as a matter of fundamental policy, may engage in repurchase
agreements with member banks of the Federal Reserve System and primary
dealers in U.S. government securities. Other investment companies managed
by FMR may enter into such transactions with banks, such as U.S. branches
of foreign banks, that may not be members of the Federal Reserve system and
with dealers that are not primary dealers, but which are deemed by FMR to
be creditworthy and otherwise qualified to engage in these transactions.
The Trustees recommend amending the fund's current policy with respect to
the specific parties with which the fund may enter into repurchase
agreements as follows. Material to be added is underlined, and material to
be deleted is [bracketed]:
"The fund may engage in a repurchase agreement with respect to any security
in which it is authorized to invest. While it does not presently appear
possible to eliminate all risks from these transactions (particularly the
possibility of a decline in is the market value of the underlying
securities, as well as delays and costs to the fund in connection with
bankruptcy proceedings), it is the fund's policy to limit repuchase
transactions to those parties [member banks of the Federal Reserve System
and primary dealers in U.S. government securities] whose creditworthiness
has been reveiwed and found satisfactory by FMR."
This policy would enable the fund to have broader flexibility when
engaging in repurchase agreements. The criteria used by FMR to evaluate the
creditworthiness of counter-parties will remain unchanged. However, you
should note that by expanding the type of institutions with which the fund
may engage in a repurchase agreement, additional risks may be incurred. For
example, the risks of transacting with U.S. branches of foreign banks
include future unfavorable political and economic developments and possible
withholding taxes, seizure of foreign deposits, currency controls, interest
limitations or other governmental restrictions which might affect the
payment of principal or interest.
CONCLUSION. The Board of Trustees believes that this Proposal will benefit
the fund by eliminating restrictions on engaging in repurchase agreements
only with specific parties. The Trustees recommend that shareholders vote
FOR the proposed changes to the fund's policy regarding repurchase
agreements. If shareholders approve the Proposal, it will be implemented on
the effective date of the next prospectus. If the Proposal is not approved
the fund's current policies will remain unchanged.
13. TO EXPAND FIDELITY GROWTH & INCOME PORTFOLIO'S AND OTC PORTFOLIO'S
FUNDAMENTAL POLICY CONCERNING FOREIGN CURRENCY CONTRACTS.
Fidelity Growth & Income Portfolio's and Fidelity OTC Portfolio's
current fundamental policy regarding foreign currency transactions allows
each fund to enter into foreign currency contracts under only two
circumstances 1) to "lock in" a specific U.S. dollar price of a security,
or 2) when FMR believes that the currency of a particular foreign country
may suffer a decline against the U.S. dollar.
The funds may use forward contracts to hedge against a decline in the
value of existing investments denominated in foreign currency. For example,
if a fund owned securities denominated in pounds sterling, the fund could
enter into a forward contract to sell pounds sterling in return for U.S.
dollars to hedge against possible declines in the pound's value. Such a
hedge, sometimes referred to as a "position hedge," would tend to offset
both positive and negative currency fluctuations, but would not offset
changes in security values caused by other factors.
When a fund agrees to buy or sell a security denominated in a foreign
currency, it may desire to "lock in" the U.S. dollar price of the security.
By entering into a forward contract for the purchase or sale, for a fixed
amount of U.S. dollars, of the amount of foreign currency involved in the
underlying security transaction, the fund will be able to protect itself
against an adverse change in foreign currency values between the date the
security is purchased or sold and the date on which payment is made or
received. This technique is sometimes referred to as a "settlement hedge"
or "transaction hedge."
FMR recommends the funds eliminate the policy that limit hedging
transaction to only two specific circumstance in order to adopt more a
flexible non-fundmental policy identical to that of the other Fidelity
funds. The policy will give each fund expanded ability to engage in
currency forward contracts. The new policy would allow each fund to
purchase and sell foreign currency options contracts on the U.S. or foreign
exchanges for investment purposes, as well as to hedge portfolio
securities. The ability to purchase puts for non-hedging purposes provides
the funds with an alternative source of total return when the performance
of the bond and equity classes are expected to be poor.
Other Fidelity equity funds have been authorized to adopt the more
flexible policy regarding hedging. The elimination of the current policy
that limits the funds to only two circumstances for heding, will enhance
the fund's ability to employ other hedging strtategies using currency
options and futures, will provide a valuable alternative to the funds'
current strategies, and will bring them in line with other domestic growth
and growth and income funds of the Fidelity complex.
To accomplish the change in policies for these funds, FMR recommends that
shareholders vote to eliminate the funds' fundamental limitations on
forward contracts and currency exchange contracts. In conjunction with the
elimination of the above mentioned policy, the Board of Trustees has
approved the adoption of the following non-fundamental policy regarding
foreign currency transactions for the funds:
"The fund may use foreign currency contracts for any purpose consistant
with its investment objective."
The following discussion summarizes some, but not all, of the possible
currency management strategies involving forward contracts that could be
used by the funds if the Proposal is approved. The funds may also use
options and futures contracts relating to foreign currencies for the same
purposes.
The funds may use forward contracts to hedge against a decline in the
value of existing investments denominated in foreign currency. For example,
if a fund owned securities denominated in pounds sterling, the fund could
enter into a forward contract to sell pounds sterling in return for U.S.
dollars to hedge against possible declines in the pound's value. Such a
hedge, sometimes referred to as a "position hedge," would tend to offset
both positive and negative currency fluctuations, but would not offset
changes in security values caused by other factors. A fund could also hedge
the position by selling another currency expected to perform similarly to
the pound sterling -- for example, by entering into a forward contract to
sell Deutschemarks or European Currency Units in return for U.S. dollars.
This type of hedge, sometimes referred to as a "proxy hedge," could offer
advantages in terms of cost, yield or efficiency, but generally will not
hedge currency exposure as effectively as a simple hedge into U.S. dollars.
Proxy hedges may result in losses if the currency used to hedge does not
perform similarly to the currency in which the hedged securities are
denominated. The funds may also enter into forward contracts to purchase
or sell a foreign currency in anticipation of future purchases or sales of
securities denominated in foreign currency, even if the specific
investments have not yet been selected by FMR.
Each fund may enter into forward contracts to shift its investment
exposure from one currency into another currency that is expected to
perform better relative to the U.S. dollar. For example, if a fund held
investments denominated in Deutschemarks, the fund could enter into forward
contracts to sell Deutschemarks and purchase Swiss Francs. This type of
strategy, sometimes known as a "cross-hedge," will tend to reduce or
eliminate exposure to the currency that is sold, and increase exposure to
the currency that is purchased, much as if the fund had sold a security
denominated in one currency and purchased an equivalent security
denominated in another. Cross-hedges protect against losses resulting from
a decline in the hedged currency, but will cause the fund to assume the
risk of fluctuations in the value of the currency it purchases.
Successful use of currency forward contracts will depend on FMR's skill in
analyzing and predicting currency values. Forward contracts may
substantially change a fund's investment exposure to changes in currency
exchange rates, and could result in losses to the fund if currencies do not
perform as FMR anticipates. For example, if a currency's value rose at a
time when FMR had hedged a fund by selling that currency in exchange for
dollars, the fund would be unable to participate in the currency's
appreciation. If FMR hedges currency exposure through proxy hedges, a fund
could realize currency losses from the hedge and the security position at
the same time if the two currencies do not move in tandem. Similarly, if
FMR increases a fund's exposure to a foreign currency, and that currency's
value declines, the fund will realize a loss. There is no assurance that
FMR's use of currency forward contracts will be advantageous to the funds
or that they will hedge at an appropriate time.
Under certain conditions, SEC guidelines require mutual funds to set aside
appropriate liquid assets in a segregated custodial account to cover
currency forward contracts. As required by SEC guidelines, the funds will
segregate assets to cover currency forward contracts, if any, whose purpose
is essentially speculative. The funds will not segregate assets to cover
forward contracts entered into for hedging purposes, including settlement
hedges, position hedges, and proxy hedges.
CONCLUSION. The Board of Trustees believes that this Proposal will benefit
the funds by eliminating restrictions on engaging in currency forward
contracts. The Trustees recommend that shareholders vote FOR the proposed
changes to the funds' policy regarding currency forward contracts. If
shareholders approve the Proposal, it will be implemented on the effective
date of the next prospectus. If the Proposal is not approved eaqch fund's
current policies will remain unchanged.
14. TO REPLACE FIDELITY GROWTH & INCOME PORTFOLIO'S AND OTC PORTFOLIO'S
FUNDAMENTAL INVESTMENT LIMITATION CONCERNING DIVERSIFICATION WITH A
FUNDAMENTAL DIVERSIFICATION LIMITATION PERMITTING INCREASED INVESTMENTS IN
SECURITIES OF ANY SINGLE ISSUER.
Fidelity Growth & Income Portfolio's current fundamental investment
limitation regarding diversification states:
"The fund may not purchase the securities of any one issuer (other than
obligations issued or guaranteed by the government of the United States,
its agencies, or instrumentalities) if, as a result (and at the time)
thereof: (a) more than 5% of the fund's total assets (taken at current
value) would be invested in the securities of such issuer, or (b) the fund
would hold more than 10% of the outstanding voting securities of such
issuer."
Fidelity OTC Portfolio's current fundamental investment limitation
regarding diversification states:
"The fund may not purchase the securities of any issuer (other than
obligations issued or guaranteed by the United States government, its
agencies or instrumentalities) if, as a result (and at the time) thereof:
(a) more than 5% of the fund's total assets (taken at current value) would
be invested in the securities of such issuer or (b) the fund would hold
more than 10% of the outstanding voting securities of such issuer."
Subject to shareholder approval, the Trustees intend to replace this
limitation with the following fundamental investment limitation regarding
diversification:
"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."
The Trustees recommend that shareholders approve an amendment to the
funds' fundamental investment limitation regarding diversification that
will permit the each fund to invest more than 5% of its total assets in the
securities of one or more issuers and to hold more than 10% of the voting
securities of one or more issuers. Subject to certain statutory exceptions
for securities of the U.S. government and its agencies and
instrumentalities, this increased investment flexibility will be confined
to 25% of a fund's total assets. The current 5% limitation applicable to
purchases of securities of a single issuer and 10% limitation applicable to
purchases of voting securities of a single issuer will remain in effect
with respect to 75% of a fund's total assets.
State securities regulations (Blue Sky regulations) at one time prohibited
a fund from registering shares for sale if the fund intended to invest more
than 5% of total assets in a single issuer or to hold more than 10% of the
voting securities of a single issuer. The funds have fundamental
restrictions that incorporate these Blue Sky restrictions. Because the Blue
Sky regulations regarding these limitations have been eliminated,
shareholder approval is sought to permit each fund to invest a higher
proportion of its assets in securities issued by a single issuer and to
hold a higher proportion of voting securities of a single issuer.
If the proposal is approved, each fund would be required to invest 75% of
its total assets so that no more than 5% of total assets would be invested
in any one issuer, and so that the fund owned no more than 10% of the
voting securities of any such issuer. As to the remaining 25% of total
assets, there would be no fundamental investment limitation on the amount
of assets a fund could invest in any single issuer or hold of voting
securities of a single issuer. This would permit a fund, for example, to
invest 25% of its total assets in a single issuer's securities, or to
invest 10% of its total assets in securities of one issuer and 15% in
securities of another issuer. The primary purpose of the proposal is to
give each fund greater investment flexibility by permitting it to acquire
larger positions in the securities of individual issuers. FMR believes that
this increased flexibility may provide opportunities to enhance a fund's
performance. At the same time, investing a larger percentage of a fund's
assets in a single issuer's securities increases a fund's exposure to
credit and other risks associated with that issuer's financial condition
and business operations, including the risk of default on debt securities.
FMR will only invest more than 5% of a fund's total assets in an issuer's
securities when it believes the securities' potential return justifies
accepting the risks associated with the higher level of investment. FMR
does not currently expect that approval will materially affect the way in
which either fund is managed with regard to a fund holding more than 10% of
the voting securities of an issuer.
If the proposal is approved, the new fundamental diversification
limitation could not be changed without a future vote of shareholders.
CONCLUSION. The Board of Trustees has concluded that the proposed
limitation will benefit each fund by providing more investment flexibility,
which may result in enhanced performance. Accordingly, the Trustees
recommend that shareholders vote FOR the proposed limitation. The new
limitation, upon shareholder approval, will become effective immediately.
If the proposal is not approved, each fund's current limitation will remain
unchanged.
ADOPTION OF STANDARDIZED INVESTMENT LIMITATIONS
The primary purpose of Proposals 15 through 28 is to revise several of the
funds' investment limitations to conform to limitations which are the
standards for similar types of funds managed by FMR. The Board of Trustees
asked FMR to analyze the various fundamental and non-fundamental investment
limitations of the Fidelity funds, and, where practical and appropriate to
a fund's investment objective and policies, propose to shareholders
adoption of standard fundamental limitations and elimination of certain
other fundamental limitations. Generally, when fundamental limitations are
eliminated, Fidelity's standard non-fundamental limitations replace them.
By making these limitations non-fundamental, the Board of Trustees may
amend a limitation as they deem appropriate, without seeking shareholder
vote. The Board of Trustees would amend the limitations to respond, for
instance, to developments in the marketplace, or changes in federal or
state law. The costs of shareholder meetings if called for these purposes
are generally borne by the fund and its shareholders.
It is not anticipated that these proposals will substantially affect the
way a fund is currently managed. However, FMR is presenting them to you
for your approval because, FMR believes that increased standardization will
help to promote operational efficiencies and facilitate monitoring of
compliance with fundamental and non-fundamental investment limitations.
Although adoption of a new or revised limitation is not likely to have any
impact on the current investment techniques employed by a fund, it will
contribute to the overall objectives of standardization.
15. TO AMEND THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING BORROWING FOR
FIDELITY BLUE CHIP GROWTH FUND, FIDELITY GROWTH & INCOME PORTFOLIO, AND
FIDELITY OTC PORTFOLIO.
Fidelity Blue Chip Growth Fund's current fundamental investment limitation
concerning borrowing states:
"The fund may not borrow money, except that the fund may borrow money for
temporary or emergency purposes (not for leveraging or investment) in an
amount not exceeding 33 1/3% of the value of its total assets (less
liabilities, other than borrowings). Any borrowings that come to exceed 33
1/3% of the value of the fund's total assets by reason of a decline in net
assets will be reduced within three days to the extent necessary to comply
with the 33 1/3% limitation; "
Fidelity Growth & Income Portfolio's current fundamental investment
limitation concerning borrowing states:
"The fund may not borrow money, except that the fund may borrow money for
temporary or emergency purposes (not for leveraging or investment) in an
amount not exceeding 33 1/3% of the value of its total assets (including
the amount borrowed) less liabilities (other than borrowings). Any
borrowings that come to exceed 33 1/3% of the fund's total assets by reason
of a decline in net assets will be reduced within three days to the extent
necessary to comply with the 33 1/3% limitation. The fund will not
purchase securities while temporary bank borrowings in excess of 5% of its
total assets are outstanding."
Fidelity OTC Portfolio's current fundamental investment limitation
concerning borrowing states:
"The fund may not borrow money, except that the fund may borrow money for
temporary or emergency purposes (not for leveraging or investment) in an
amount not exceeding 33 1/3% of the value of its total assets (including
the amount borrowed) less liabilities (other than borrowings). Any
borrowings that come to exceed 33 1/3% of the fund's total assets by reason
of a decline in net assets will be reduced within 3 days to the extent
necessary to comply with the 33 1/3% limitation."
Subject to shareholder approval, the Trustees intend to replace each
fund's respective fundamental investment limitation with the following
fundamental investment limitation governing borrowing:
"The fund may not borrow money, except that the fund may borrow money for
temporary or emergency purposes (not for leveraging or investment) in an
amount not exceeding 33 1/3% of its total assets (including the amount
borrowed) less liabilities (other than borrowings). Any borrowings that
come to exceed this amount will be reduced within three days (not including
Sundays and holidays) to the extent necessary to comply with the 33 1/3%
limitation."
The primary purpose of the proposal is to revise each fund's fundamental
borrowing limitation to conform to a limitation that is expected to become
standard for all funds managed by FMR. (See "Adoption of Standardized
Investment Limitations" on page .) If the proposal is approved, the amended
fundamental borrowing limitation cannot be changed without a future vote of
shareholders.
The proposed amended limitation, while not substantially different from
the current limitation, would require each fund to reduce borrowings that
come to exceed 33 1/3% of total assets for any reason. Under the current
limitation, each fund must reduce borrowings that come to exceed 33 1/3% of
total assets only by reason of a decline in net assets. In addition, with
respect to Growth & Income Portfolio, the fund currently has a
limitation describing its policy of not purchasing a security while
borrowings representing more than 5% of total assets are outstanding
covered in its fundamental borrowing limitation. The proposed limitation
also specifically defines "three business days" to exclude Sundays and
holidays. Subject to shareholder approval, the Trustees intend to replace
these components of the fundamental investment limitation with similar
non-fundamental investment limitations that could be changed by vote of the
Trustees without further approval by shareholders.
CONCLUSION. The Board of Trustees has concluded that the proposed
amendment will benefit each fund. Accordingly, the Trustees recommend
voting FOR the proposed amendment. The amended limitation, upon shareholder
approval, will become effective immediately. With respect to each fund, if
the proposal is not approved, the fund's current limitation will remain
unchanged.
16. TO AMEND THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING REAL ESTATE
FOR FIDELITY BLUE CHIP GROWTH FUND, FIDELITY GROWTH & INCOME PORTFOLIO,
AND FIDELITY OTC PORTFOLIO.
The fundamental investment limitation for Fidelity Blue Chip Growth Fund
currently states:
"The fund may not purchase or sell real estate unless acquired as a result
of ownership of securities (but this shall not prevent the fund from
purchasing and selling marketable securities issued by companies or other
entities or investment vehicles that deal in real estate or interests
therein, nor shall this prevent the fund from purchasing interests in pools
of real estate mortgage loans."
The fundamental investment limitation for Fidelity Growth & Income
Portfolio and Fidelity OTC Portfolio currently states:
"The fund may not purchase or sell real estate (but this shall not prevent
the fund from investing in marketable securities issued by companies such
as real estate investment trusts which deal in real estate or interests
therein and participation interests in pools of real estate mortgage
loans);
Subject to shareholder approval, the Trustees intend to replace each
fund's respective fundamental investment limitation with the following
fundamental investment limitation governing purchases and sales of real
estate.
"The fund may not purchase or sell real estate unless acquired as a result
of ownership of securities or other instruments (but this shall not prevent
the fund from investing in securities or other instruments backed by real
estate or securities of companies engaged in the real estate business)."
The primary purpose of the proposed amendment is to clarify the types of
securities in which each fund is authorized to invest and to conform each
fund's fundamental real estate limitation to a limitation that is expected
to become the standard for all funds managed by FMR. (See "Adoption of
Standardized Investment Limitations" on page __.) If the proposal is
approved, the new fundamental real estate limitation may not be changed
without a future vote of shareholders.
Adoption of the proposed limitation concerning real estate is not expected
to affect the way in which each fund is managed, the investment performance
of the funds, or the securities or instruments in which the funds invest.
Each fund does not expect to acquire real estate. However, the proposed
limitation would clarify two points. First, the proposed limitation would
make it explicit that a fund may acquire a security or other instrument, of
which the payments of interest and principal may be secured by a mortgage
or other right to foreclose on real estate, in the event of default.
Second, the proposed limitation would clarify the fact that the fund may
invest without limitation in securities issued or guaranteed by companies
engaged in acquiring, constructing, financing, developing, or operating
real estate projects (e.g., securities of issuers that develop various
industrial, commercial, or residential real estate projects such as
factories, office buildings, or apartments). Any investments in these
securities are, of course, subject to the fund's investment objective and
policies and to other limitations regarding diversification and
concentration. With respect to Blue Chip Growth, the proposed limitation
specifically permits the fund to sell real estate acquired as a result of
ownership of securities or other instruments. However, in light of the
types of securities in which the fund regularly invests, FMR considers this
to be a remote possibility.
CONCLUSION. The Board of Trustees has concluded that the adoption of the
amended limitation will benefit each fund and its shareholders. The
Trustees recommend that shareholders of each fund vote FOR the proposed
amendment. The amended limitation, upon shareholder approval, will become
effective immediately. With respect to each fund, if the proposal is not
approved, the fund's current limitation will remain unchanged.
17. TO AMEND THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING THE ISSUANCE
OF SENIOR SECURITIES FOR FIDELITY BLUE CHIP GROWTH FUND, FIDELITY GROWTH
& INCOME PORTFOLIO, AND FIDELITY OTC PORTFOLIO.
Fidelity Blue Chip Growth Fund's current fundamental investment limitation
regarding the issuance of senior securities states:
"The fund may not issue bonds or any other class of securities preferred
over shares of the fund with respect to the fund's assets or earnings,
provided that Fidelity Securities Fund (the Trust) may issue additional
series of shares in accordance with its Declaration of Trust."
Fidelity Growth & Income Portfolio's current fundamental investment
limitation regarding the issuance of senior securities states:
"The fund may not issue senior securities."
Fidelity OTC Portfolio's current fundamental investment limitation
regarding the issuance of senior securities states:
"The fund may not issue senior securities."
The Trustees recommend that shareholders vote to replace each fund's
respective fundamental investment limitation with the following fundamental
investment limitation governing the issuance of senior securities:
"The fund may not issue senior securities, except as permitted under the
Investment Company Act of 1940."
The primary purpose of the proposal is to revise each fund's fundamental
senior securities limitation to conform to a limitation that is expected to
become the standard for all funds managed by FMR. (See "Adoption of
Standardized Investment Limitations" on page _.) If the proposal is
approved, the new fundamental senior securities limitation cannot be
changed without a future vote of the fund's shareholders.
Adoption of the proposed limitation on senior securities is not expected to
affect the way in which each fund is managed, the investment performance of
the funds, or the securities or instruments in which the funds invest.
However, the proposed limitation clarifies that the funds may issue senior
securities to the extent permitted under the 1940 Act.
Although the definition of a "senior security" involves complex statutory
and regulatory concepts, a senior security is generally thought of as an
obligation of a fund which has a claim to the fund's assets or earnings
that takes precedence over the claims of the fund's shareholders. The
1940 Act generally prohibits mutual funds from issuing senior securities;
however, mutual funds are permitted to engage in certain types of
transactions that might be considered "senior securities" as long as
certain conditions are satisfied. For example, a transaction which
obligates a fund to pay money at a future date (e.g., the purchase of
securities to be settled on a date that is further away than the normal
settlement period) may be considered a "senior security." A mutual fund
is permitted to enter into this type of transaction if it maintains a
segregated account containing liquid securities in amount equal to its
obligation to pay cash for the securities at a future date. The fund
utilizes transactions that may be considered "senior securities" only in
accordance with applicable regulatory requirements under the 1940 Act.
CONCLUSION. The Board of Trustees recommends voting FOR the proposed
amendment. The amended limitation, upon shareholder approval, will become
effective immediately. With respect to each fund, if the proposal is not
approved, the fund's current limitation will remain unchanged.
18. TO ELIMINATE THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING SHORT
SALES OF SECURITIES FOR FIDELITY BLUE CHIP GROWTH FUND, FIDELITY GROWTH
& INCOME PORTFOLIO, AND FIDELITY OTC PORTFOLIO.
Fidelity Blue Chip Growth Fund's current fundamental investment limitation
concerning selling securities short states:
"The fund may not sell securities short, unless it owns, or by virtue of
ownership of other securities has the right to obtain, securities
equivalent in kind and amount to the securities sold short, and provided
that transactions in futures contracts are not deemed to constitute short
sales."
Fidelity Growth & Income Portfolio's current fundamental investment
limitation concerning selling securities short states:
"The fund may not make short sales of securities (except by selling
futures contracts) unless it owns, or by virtue of its ownership of other
securities has the right to obtain, securities equivalent in kind and
amount to the securities sold; "
Fidelity OTC Portfolio's current fundamental investment limitation
concerning selling securities short states:
"The fund may not make short sales of securities, unless it owns or, by
virtue of its ownership of other securities, has the right to obtain,
securities equivalent in kind and amount to the securities sold; provided,
however, that the fund may purchase or sell futures contracts."
The Trustees of each fund recommend that shareholders vote to eliminate
the above fundamental investment limitations. If the proposal is approved,
the Trustees intend to replace the current fundamental limitations with a
non-fundamental limitation that could be changed without a vote of
shareholders. The proposed non-fundamental limitation is set forth below,
with a brief analysis of the substantive differences between it and the
current limitations.
In a short sale, an investor sells a borrowed security and has a
corresponding obligation to the lender to return the identical security.
In an investment technique known as a short sale "against the box," an
investor sells securities short while owning the same securities in the
same amount, or having the right to obtain equivalent securities. The
investor could have the right to obtain equivalent securities, for example,
through its ownership of warrants, options, or convertible bonds. If the
proposal is approved by shareholders of each respective fund, the Trustees
intend to adopt the following non-fundamental investment limitation on
short selling, which would permit short sales against the box:
"The fund does not currently intend to sell securities short, unless it
owns or has the right to obtain securities equivalent in kind and amount to
the securities sold short, and provided that transactions in futures
contracts and options are not deemed to constitute selling securities
short."
Certain state regulations currently prohibit mutual funds from entering
into any short sales, other than short sales against the box. If the
proposal is approved, however, the Board of Trustees would be able to
change the proposed non-fundamental limitation in the future, without a
vote of shareholders, if state regulations were to change to permit other
types of short sales, or if waivers from existing requirements were
available, subject to appropriate disclosure to investors.
The funds do not currently anticipate entering into any short sales
including short sales against the box. If the proposal is approved,
however, each fund would be able to change that policy in the future,
without a vote of shareholders, subject to the supervision of the Trustees
and appropriate disclosure to existing and prospective investors.
Although elimination of the funds' fundamental limitations on short
selling is unlikely to affect each fund's investment techniques at this
time, in the event of a change in state regulatory requirements, each fund
may alter its investment practices in the future. The Board of Trustees
believes that efforts to standardize each fund's investment limitations
will facilitate FMR's investment compliance efforts (see "Adoption of
Standardized Investment Limitations" on page __) and are in the best
interests of shareholders.
CONCLUSION. The Board of Trustees recommends voting FOR the proposal to
eliminate each fund's respective fundamental investment limitations
regarding short sales of securities. If approved, the proposal will take
effect immediately. With respect to each fund, if the proposal is not
approved, the fund's current limitation will remain unchanged.
19. TO ELIMINATE THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING MARGIN
PURCHASES FOR FIDELITY BLUE CHIP GROWTH FUND, FIDELITY GROWTH & INCOME
PORTFOLIO, AND FIDELITY OTC PORTFOLIO.
Fidelity Blue Chip Growth Fund's current fundamental investment limitation
concerning purchasing securities on margin states:
"The fund may not purchase securities on margin, except that the fund may
obtain such short-term credits as are necessary for the clearance of
transactions, and provided that the fund may make initial and variation
margin payments in connection with transactions in futures contracts and
options on futures contracts. "
Fidelity Growth & Income Portfolio's current fundamental investment
limitation concerning purchasing securities on margin states:
"The fund may not purchase any security on margin (except for such
short-term credits as are necessary for the clearance of transactions) and
provided that the fund may make initial and variation margin payments in
connection with purchases or sales of futures contracts or of options on
futures contracts."
Fidelity OTC Portfolio's current fundamental investment limitation
concerning purchasing securities on margin states:
"The fund may not purchase any securities on margin (except for such
short-term credits as are necessary for the clearance of transactions);
provided, however, that the fund may make initial and variation margin
payments in connection with purchases or sales of futures contracts or of
options on futures contracts."
The Trustees recommend that shareholders of each fund vote to eliminate
the above fundamental investment limitations. If the proposal is approved,
the Trustees intend to adopt a non-fundamental limitation for each fund
that could be changed without a vote of shareholders. The proposed
non-fundamental limitation is set forth below, with a brief analysis of the
substantive differences between it and the current limitations.
Margin purchases involve the purchase of securities with money borrowed
from a broker. "Margin" is the cash or eligible securities that the
borrower places with a broker as collateral against the loan. Each fund's
current fundamental limitation prohibits the fund from purchasing
securities on margin, except to obtain short-term credits as may be
necessary for the clearance of transactions and for initial and variation
margin payments made in connection with the purchase and sale of futures
contracts and options on futures contracts. Mutual funds are also
permitted to obtain short-term credits as may be necessary for the
clearance of transactions. With these exceptions, mutual funds are
prohibited from entering into most types of margin purchases by applicable
SEC policies. The proposed non-fundamental limitation includes these
exceptions.
If the proposal is approved by shareholders, the Trustees intend to adopt
the following non-fundamental investment limitation, which would prohibit
margin purchases except as permitted under the conditions referred to
above:
"The fund does not currently intend to purchase securities on margin,
except that the fund may obtain such short-term credits as are necessary
for the clearance of transactions, and provided that margin payments in
connection with futures contracts and options on futures contracts shall
not constitute purchasing securities on margin."
Although elimination of each fund's fundamental limitation on margin
purchases is unlikely to affect the fund's investment techniques at this
time, in the event of a change in federal regulatory requirements, the
funds may alter their investment practices in the future. The Board of
Trustees believes that efforts to standardize investment limitations will
facilitate FMR's investment compliance efforts (see "Adoption of
Standardized Investment Limitations" on page __.) and are in the best
interests of shareholders.
CONCLUSION. The Trustees recommend voting FOR the proposal to eliminate
each fund's fundamental investment limitation regarding margin purchases.
If approved, the new non-fundamental limitation will become effective
immediately. If the proposal is not approved by the shareholders of each
fund, that fund's current limitation will remain unchanged.
20. TO AMEND THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING LENDING FOR
FIDELITY BLUE CHIP GROWTH FUND, FIDELITY GROWTH & INCOME PORTFOLIO, AND
FIDELITY OTC PORTFOLIO.
Fidelity Blue Chip Growth Fund's current fundamental investment limitation
concerning lending states:
"The fund may not make loans, except (a) by lending portfolio securities,
or by lending money to registered investment companies or portfolios
thereof for which FMR or an affiliate serves as investment adviser, or to a
joint account of such companies or portfolios; provided that no loan will
be made if, as a result thereof, more than 33 1/3% of the fund's total
assets (taken at current value) would be lent to another party; (b) through
the purchase of a portion of an issue of debt securities in accordance with
its investment objective, policies, and limitations; and (c) by engaging in
repurchase agreements with respect to portfolio securities."
Fidelity Growth & Income Portfolio's current fundamental investment
limitation concerning lending states:
"The fund may not lend any security or make any other loan if, as a
result, more than 33 1/3% of the fund's total assets would be lent to other
parties, except (i) through the purchase of a portion of an issue of debt
securities in accordance with its investment objective, policies, and
limitations, or (ii) by engaging in repurchase agreements with respect to
fund securities."
Fidelity OTC Portfolio's current fundamental investment limitation
concerning lending states:
"The fund may not lend any security or make any other loan if, as a
result, more than 33 1/3% of the fund's total assets would be lent to other
parties, except, (i) through the purchase of a portion of an issue of debt
securities in accordance with its investment objective, policies, and
limitations, or (ii) by engaging in repurchase agreements with respect to
portfolio securities; ."
Subject to shareholder approval, the Trustees intend to replace each
fund's fundamental investment limitation with the following fundamental
investment limitation governing lending:
"The fund may not lend any security or make any other loan if, as a
result, more than 33 1/3% of its total assets would be lent to other
parties, but this limitation does not apply to purchases of debt securities
or to repurchase agreements."
The primary purpose of the proposal is to revise each fund's fundamental
lending limitation to conform to a limitation that is expected to become
standard for all funds managed by FMR. (See "Adoption of Standardized
Investment Limitations" on page __.) If the proposal is approved, the new
fundamental lending limitation cannot be changed without a future vote of
shareholders.
CONCLUSION. The Board of Trustees has concluded that the proposed
amendment will benefit each fund. Accordingly, the Trustees recommend that
shareholders of each respective fund vote FOR the proposed amendment. The
amended limitation, upon shareholder approval, will become effective
immediately. With respect to each fund, if the proposal is not approved,
the current limitation will remain unchanged.
21. TO AMEND BLUE CHIP GROWTH FUND'S FUNDAMENTAL INVESTMENT LIMITATION
CONCERNING DIVERSIFCATION.
The 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 obligations issued or guaranteed
by the United States government, or any of its agencies or
instrumentalities) if, as a result thereof, (i) more than 5% of the fund's
total assets would be invested in the securities of such issuer, or (ii)
the fund would hold more than 10% of the voting securities of such issuer."
Subject to shareholder approval, the Trustees intend to replace the fund's
fundamental investment limitation with the following amended fundamental
investment limitation governing diversification:
"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. ."
The primary purpose of the proposal is to revise the funds' fundamental
diversification limitation to conform to a limitation which is expected to
become standard for all diversified funds managed by FMR. Although adoption
of the new diversification limitation is not likely to have a significant
impact on the investment techniques employed by the fund, it will
contribute to the overall objectives of standardization. (See "Adoption of
Standardized Investment Limitations" on page __.) If the proposal is
approved, the new fundamental diversification limitation cannot be changed
without a future vote of shareholders.
22. TO ELIMINATE THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING
INVESTMENT IN OTHER INVESTMENT COMPANIES FOR FIDELITY GROWTH & INCOME
PORTFOLIO AND FIDELITY OTC PORTFOLIO.
Fidelity Growth & Income Portfolio's current fundamental investment
limitation concerning investment in other investment companies states:
"The fund may not purchase securities of other investment companies
(except in the open market where no commission except the ordinary broker's
commission is paid, or as part of a merger or consolidation, and in no
event may investments in such securities exceed 10% of the total assets of
the fund). The fund may not purchase or retain securities issued by other
open-end investment companies."
Fidelity OTC Portfolio's current fundamental investment limitation
concerning investment in other investment companies states:
"The fund may not purchase securities of other investment companies
(except in the open market where no commission except the ordinary broker's
commission is paid, or as part of a merger or consolidation, and in no
event may investments in such securities exceed 10% of the total assets of
the fund). The fund may not purchase or retain securities issued by other
open-end investment companies."
The Trustees recommend that shareholders of each fund vote to eliminate
the above referenced fundamental investment limitation. If the proposal is
approved, the Trustees intend to replace the current fundamental investment
limitation for each fund with the following non-fundamental limitation,
which could be changed without a vote of shareholders:
"The fund does not currently intend to (a) purchase securities of other
investment companies, except in the open market where no commission except
the ordinary broker's commission is paid, or (b) purchase or retain
securities issued by other open-end investment companies. Limitations (a)
and (b) do not apply to securities received as dividends, through offers of
exchange, or as a result of a reorganization, consolidation, or merger."
The ability of mutual funds to invest in other investment companies is
restricted by rules under the 1940 Act and by some state regulations. Each
fund's current fundamental investment limitation recites certain of the
applicable federal and former state restrictions. The federal restrictions
will remain applicable to the fund whether or not they are recited in a
fundamental limitation. As a result, elimination of the above fundamental
limitation is not expected to have any impact on either fund's investment
practices, except to the extent that regulatory requirements may change in
the future.
CONCLUSION. The Board of Trustees believes that the efforts to standardize
each fund's investment limitations will facilitate FMR's investment
compliance efforts (see "Adoption of Standardized Investment Limitations"
on page __) and are in the best interests of the shareholders. Accordingly,
the Board of Trustees recommends voting FOR the proposal to eliminate each
fund's fundamental investment limitation regarding investments in other
investment companies. If approved, the new non-fundamental investment
limitation will become effective immediately. With respect to each fund, if
the proposal is not approved, the fund's current investment limitation will
remain unchanged.
23. TO ADOPT A FUNDAMENTAL INVESTMENT LIMITATION CONCERNING COMMODITIES FOR
FIDELITY GROWTH & INCOME PORTFOLIO AND FIDELITY OTC PORTFOLIO.
Currently, the funds do not have a fundamental investment limitation
describing their policy regarding the purchase and sale of commodities.
Pursuant to Section 8(b) of the 1940 Act, a mutual fund must state its
policy relating to, among other things, the purchase and sale of
commodities. In general, the funds do not anticipate any future investment
activity with respect to physical commodities, but pursuant to securities
regulation, must adopt a stated policy.
The following proposed fundamental investment limitation concerning the
purchase or sale of commodities is the standard one for all funds managed
by FMR and has been recommended by the Board of Trustees:
"The fund may not purchase or sell physical commodities unless acquired as
a result of ownership of securities or other instruments (but this shall
not prevent the fund from purchasing or selling options and futures
contracts or from investing in securities or other instruments backed by
physical commodities).
The proposed fundamental policy conforms to a limitation that is expected
to become standard for all funds managed by FMR. (See "Adoption of
Standardized Investment Limitations" on page __). The funds do not expect
to purchase or sell commodities. However, the proposed limitation would
permit each fund to invest in securities backed by commodities and to sell
commodities acquired as a result of ownership of other investments. In
addition, the proposed limitation does not prevent the funds from engaging
in options and futures contracts.
CONCLUSION. The Board of Trustees recommends voting FOR the proposal to
adopt a fundamental investment limitation concerning commodities. The
proposed limitation, upon shareholder approval, will become effective
immediately. If the proposal is not approved, the funds will remain without
a fundamental investment limitation regarding physical commodities.
24. TO AMEND FIDELITY BLUE CHIP GROWTH FUND'S FUNDAMENTAL INVESTMENT
LIMITATION CONCERNING COMMODITIES.
The fund's current fundamental investment limitation concerning
commodities states:
"The fund may not purchase or sell physical commodities unless acquired as
a result of ownership of securities (but this shall not prevent the fund
from purchasing and selling futures contracts)."
Subject to shareholder approval, the Trustees intend to replace this
fundamental investment limitation with the following fundamental
investment limitation governing commodities:
"The fund may not purchase or sell physical commodities unless acquired as
a result of ownership of securities or other instruments (but this shall
not prevent the fund from purchasing or selling options and futures
contracts or from investing in securities or other instruments backed by
physical commodities).
The primary purpose of this proposal is to implement a fundamental
investment limitation on commodities that conforms to a limitation which is
expected to become standard for all funds managed by FMR. (See "Adoption of
Standardized Investment Limitations" on page __.) If the proposal is
approved, the new fundamental commodities limitation cannot be changed
without a future vote of shareholders.
Adoption of the proposed limitation on commodities is not expected to
affect the way in which the fund is managed, the investment performance of
the fund, or the securities or instruments in which the fund invests.
However, the proposed limitation would clarify two points. First, the
proposed limitation would make it explicit that the fund may acquire
physical commodities as the result of ownership of securities or other
instruments. Second, the proposed limitation would clarify that the fund
may invest without limit in securities or other instruments backed by
physical commodities. Any investments of this type are, of course,
subject only to the fund's investment objective, policies, and other
limitations.
CONCLUSION. The Board of Trustees has concluded that the adoption of the
proposed amendment will benefit the fund and its shareholders. The Trustees
recommend that shareholders of the fund vote FOR the proposed amendment.
The amended limitation, upon shareholder approval, will become effective
immediately. If the proposal is not approved, the fund's current limitation
will remain unchanged.
25. TO ELIMINATE FIDELITY GROWTH & INCOME PORTFOLIO AND FIDELITY OTC
PORTFOLIO'S FUNDAMENTAL INVESTMENT LIMITATION CONCERNING INVESTING IN OIL,
GAS, AND OTHER MINERAL EXPLORATION PROGRAMS.
Currently, each fund maintains a fundamental investment limitation
specifying that it may not "invest in oil, gas or other mineral
exploration or development programs." Investment in oil, gas, or other
mineral exploration programs is permitted under federal standards for
mutual funds, but currently is prohibited by some state regulations.
The Trustees recommend that shareholders vote to eliminate the above
fundamental investment limitation. If the proposal is approved, the
Trustees of the funds intend to adopt the following non-fundamental
investment limitation, which could be changed without a shareholder vote:
"The fund does not currently intend to invest in oil, gas, or other
mineral exploration or development programs or leases."
The proposal will have no current impact on the funds. However, adoption
of a standardized non-fundamental investment limitation will facilitate
FMR's investment compliance efforts (see "Adoption of Standardized
Investment Limitations" on page __), and will enable the funds to respond
more promptly if applicable state laws change in the future.
CONCLUSION. The Board of Trustees recommends voting FOR the proposal to
eliminate each fund's fundamental investment limitation concerning
investment in oil, gas, and other mineral exploration programs. If
approved, the proposal will take effect immediately. If the proposal is not
approved, each fund's current limitation will remain unchanged.
26. TO AMEND FIDELITY BLUE CHIP GROWTH FUND, FIDELITY GROWTH & INCOME
PORTFOLIO, AND FIDELITY OTC PORTFOLIOS' FUNDAMENTAL INVESTMENT LIMITATION
CONCERNING THE CONCENTRATION OF ITS INVESTMENTS IN A SINGLE INDUSTRY.
Fidelity Blue Chip Growth Fund's current fundamental investment limitation
concerning the concentration of its investments within a single industry
states:
"The fund may not purchase the securities of any issuer (other than
obligations issued or guaranteed by the United States government or any of
its agencies or instrumentalities) if, as a result, more than 25% of the
fund's total assets (taken at current value) would be invested in the
securities of issuers having their principal business activities in the
same industry."
Fidelity Growth & Income Portfolio's current fundamental investment
limitation concerning the concentration of its investments within a single
industry states:
"The fund may not purchase the securities of any one issuer (other than
obligations issued or guaranteed by the government of the United States, it
agencies, or instrumentalities) if, as a result (and at the time) thereof
more than 25% of the fund's total assets (taken at current value) would be
invested in the securities of issuers having their principal business
activities in the same industry."
Fidelity OTC Portfolio's current fundamental investment limitation
concerning the concentration of its investments within a single industry
states:
"The fund may not purchase the securities of any one issuer (other than
obligations issued or guaranteed by the United States government, its
agencies or instrumentalities) if, as a result (and at the time) thereof,
more than 25% of the fund's total assets (taken at current value) would be
invested in the securities of issuers having their principal business
activities in the same industry."
Subject to shareholder approval, the Trustees intend to replace each
fund's fundamental investment limitation with the following amended
fundamental investment limitation governing concentration:
"The fund may not purchase the securities of any issuer (other than
securities issued or guaranteed by the U.S. government or any of its
agencies or instrumentalities) if, as a result, more than 25% of the fund's
total assets would be invested in the securities of companies whose
principal business activities are in the same industry."
The primary purpose of the proposal is to revise each fund's fundamental
concentration limitation to conform to a limitation which is expected to
become standard for all funds managed by FMR. (See "Adoption of
Standardized Investment Limitations" on page __.) If the proposal is
approved, the new fundamental concentration limitation could not be changed
without a future vote of shareholders.
Adoption of the proposed limitation on concentration is not expected to
affect the way the funds are managed, the investment performance of the
funds, or the securities or instruments in which the funds invest. The
proposed amended limitation is not substantially different from the current
policy and is not likely to have any impact on the investment techniques
employed by the funds.
CONCLUSION. The Board of Trustees has concluded that the proposed
amendment will benefit the funds. The Trustees recommend voting FOR the
proposed amendment. The new limitations, upon shareholder approval, will
become effective immediately. If the proposal is not approved, each fund's
current investment limitation will remain unchanged.
27. TO ELIMINATE THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING
RESTRICTED AND ILLIQUID SECURITIES FOR FIDELITY GROWTH & INCOME
PORTFOLIO AND FIDELITY OTC PORTFOLIO.
Each fund's current fundamental investment limitation concerning
restricted and illiquid securities is as follows:
"The fund may not knowingly purchase or otherwise acquire any securities
which are subject to legal or contractual restrictions on resale
("restricted securities"), or for which there is no readily available
market, or engage in a repurchase agreement maturing in more than seven
days with respect to any security if, as a result, more than 10% of the
fund's net assets would be invested in such securities."
Subject to shareholder approval, the Trustees intend to replace this
fundamental limitation with the following non-fundamental investment
limitation that could be changed by vote of the Trustees in response to
regulatory, market, legal, or other developments without further approval
by shareholders.
"The fund does not currently intend to purchase any security if, as a
result, more than 10% of its net assets would be invested in securities
that are deemed to be illiquid because they are subject to legal or
contractual restrictions on resale or because they cannot be sold or
disposed of in the ordinary course of business at approximately the prices
at which they are valued."
Under the Investment Company Act of 1940, mutual funds are required to
price their shares daily and to offer daily redemptions with payment to
follow within seven days of the redemption request. In order to satisfy
these requirements, mutual funds are required to limit their holdings in
illiquid securities to 15% of their net assets because illiquid securities
may be difficult to value daily and difficult to sell promptly at an
acceptable price. The percentage limitation restricting the amount a fund
may invest in illiquid securities and the types of securities considered
illiquid have changed over time. For example, prior to 1993, the percentage
limit on a fund's investment in illiquid securities was 10% and prior to
1990, all securities subject to legal or contractual restrictions on resale
(restricted securities) were consider illiquid.
In order to be able to take advantage of regulatory and market
developments, FMR recommends that each fund eliminate its fundamental
investment limitation with respect to restricted and illiquid securities
and replace it with a non-fundamental limitation on illiquid securities.
Non-fundamental investment limitations can be changed without shareholder
approval. Making each fund's limitation non-fundamental will allow the
funds to respond more quickly to legal, regulatory, and market developments
without the expense of a future shareholder vote.
If this proposal is approved by shareholders, the specific types of
securities that may be deemed to be illiquid will be determined by FMR,
under the supervision of the Board of Trustees who will monitor each fund's
investments in illiquid securities. The ability of FMR to determine the
liquidity of the securities it purchases will provide the funds with the
flexibility to take advantage of changing market and regulatory conditions
which have made each fund's current limitations unnecessarily restrictive.
For example, under the current fundamental limit, all restricted securities
are considered illiquid. Many municipal securities impose restrictions on
resale to the general public as a result of securities law requirements or
credit enhancement features. However, these municipal securities often
carry demand features which permit a fund to resell the obligation to the
issuer for repayment within seven days or can be readily resold to other
institutional investors. These features may make these municipal securities
liquid despite legal restrictions on resale to the general public. The
proposed non-fundamental investment limitation would permit the funds to
consider these securities liquid if FMR determines they can be sold or
disposed of in the ordinary course of business at approximately the price
at which they are valued.
The types of securities that will be considered illiquid by FMR will vary
over time based on changing market and regulatory conditions. In
determining the liquidity of each fund's investments, FMR may consider
various factors, including (1) the frequency of trades and quotations, (2)
the number of dealers and prospective purchasers in the marketplace, (3)
dealer undertakings to make a market, (4) the nature of the security
(including any demand or tender features), or (5) the nature of the
marketplace for trades (including the ability to assign or offset the
funds' rights and obligations relating to the investment). Currently, FMR
anticipates treating repurchase agreements maturing in more than seven
days, over-the-counter options, non-government stripped fixed-rate mortgage
backed securities, government stripped, fixed-rate mortgage backed
securities, loans and other direct debt instruments, and swap agreements as
illiquid securities.
The fund does not currently intend to take advantage of the ability to
invest up to 15% of its net assets in illiquid securities, as is permitted
under federal securities regulations. However, if the proposal is approved
by shareholders, the Board of Trustees could approve an increase to 15%
without further shareholder approval.
CONCLUSION. The Board of Trustees has considered this proposal and
believes that elimination of each fund's fundamental investment limitation
on restricted and illiquid securities is in the best interest of
shareholders. Therefore, the Trustees recommend that shareholders vote FOR
the elimination of the fundamental limitation. This amendment to the funds'
investment limitations will become effective immediately upon shareholder
approval. With respect to each fund, if the proposal is not approved, the
fund's current limitation will remain unchanged.
28. TO ELIMINATE THE FUNDAMENTAL INVESTMENT LIMITATION CONCERNING
PURCHASING SECURITIES OF AN ISSUER IN WHICH THE TRUSTEES OR DIRECTORS OR
OFFICERS OF THE FUNDS OR FMR HOLD MORE THAN 5% OF THE OUTSTANDING
SECURITIES OF SUCH ISSUER FOR FIDELITY GROWTH & INCOME PORTFOLIO AND
FIDELITY OTC PORTFOLIO.
Each fund's investment limitation currently includes a restriction which
prohibits the fund from purchasing or retaining the securities of any
issuer if the officers and Trustees or directors of the trust or FMR who
individually own more than 1/2 of 1% of that issuer hold, in the aggregate,
more than 5% of that issuer's securities. This investment limitation was
originally adopted to address state or "Blue Sky" requirements in
connection with the registration of shares of the fund for sale. Only one
state currently requires such a limitation.
Fidelity Growth & Income Portfolio's current fundamental investment
limitation concerning purchasing securities of an issuer in which the
Trustees or directors or officers of the funds or of FMR hold more than 5%
of the outstanding securities of such issuer states:
"The fund may not purchase or retain the securities of any issuer other
than the securities of the fund, if, to the fund's knowledge, those
trustees (directors) and officers of the fund, or the investment adviser,
who individually own beneficially more than 1/2 of 1% of the outstanding
securities of such issuer, together own beneficially more than 5% of such
outstanding securities."
Fidelity OTC Portfolio's current fundamental investment limitation
concerning purchasing securities of an issuer in which the Trustees or
directors or officers of the funds or of FMR hold more than 5% of the
outstanding securities of such issuer states:
"The fund may not purchase or retain the securities of any issuer other
than the securities of the fund if, to the fund's knowledge, those trustees
and officers of the trust, or the investment adviser, who individually own
beneficially more than 1/2 of 1% of the outstanding securities of such
issuer, together own beneficially more than 5% of such outstanding
securities."
FMR believes that these fundamental limitations should be eliminated
because, while these limitations have not precluded investments in the
past, their elimination will potentially increase the funds' flexibility
when choosing investments in the future. Subject to shareholder approval,
the Trustees of the funds intend to replace this fundamental limitation
with a non-fundamental investment limitation that could be changed by vote
of the Trustees in response to regulatory, market, legal, or other
developments without further approval by shareholders. The new
non-fundamental policy, which is substantially the same as the fund's
current fundamental investment limitation, would provide that:
"The fund does not currently intend to purchase the securities of any
issuer if those officers and Trustees of the trust and those officers and
directors of FMR who individually own more than 1/2 of 1% of the securities
of such issuer together own more than 5% of such issuer's securities."
CONCLUSION: The Trustees of the funds have considered the relevant factors
and believe that the proposed non-fundamental investment limitation is in
the best interest of each fund's shareholders. Therefore, the Trustees have
recommended that the shareholders vote FOR the elimination of the
fundamental restriction concerning investing in the issuers in which the
officers, directors or Trustees of the trust and FMR who own more than 1/2
of 1% of an issuer's securities together own more than 5% of any class of
securities of such issuer. If approved, the new non-fundamental limitation
will take effect immediately. If the proposal is not approved by the
shareholders of a fund, that fund's current fundamental limitation 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.
PRESENT MANAGEMENT CONTRACTS
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 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 the fund's investments, and
compensates all officers of the trust, all Trustees who are "interested
persons" of the trust or of FMR, and all personnel of the trust or of FMR
performing services relating to research, statistical, and investment
activities.
In addition, FMR or its affiliates, subject to the supervision of the
Board of Trustees, provide the management and administrative services
necessary for the operation of each fund. These services include providing
facilities for maintaining each fund's organization; supervising relations
with custodians, transfer and pricing agents, accountants, underwriters,
and other persons dealing with the funds; 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 law; developing management and shareholder services for each of the
funds; and furnishing reports, evaluations, and analyses on a variety of
subjects to the Board of Trustees.
In addition to the management fee payable to FMR and the fees payable to
Fidelity Service Co. (FSC), each fund pays all of its expenses, without
limitation, that are not assumed by those parties. Each fund pays for
typesetting, printing, and mailing proxy material to shareholders, legal
expenses, and the fees of the custodian, auditor, and non-interested
Trustees. Although each fund's management contract provides that the fund
will pay for typesetting, printing, and mailing prospectuses, statements of
additional information, notices, and reports to existing shareholders, the
trust has entered into a revised transfer agent agreement with FSC,
pursuant to which FSC bears the cost of providing these services to
existing shareholders. Other expenses paid by each fund include interest,
taxes, brokerage commissions, the fund's proportionate share of insurance
premiums and Investment Company Institute dues, and the costs of
registering shares under federal and state securities laws. Each fund is
also liable for such nonrecurring expenses as may arise, including costs of
any litigation to which a fund may be a party and any obligation it may
have to indemnify the trust's officers and Trustees with respect to
litigation.
FMR is the funds' manager pursuant to management contracts dated December
1, 1988 (Fidelity Blue Chip Growth Fund, Fidelity Growth & Income
Portfolio, and Fidelity OTC Portfolio) and April 15, 1993 (Fidelity
Fidelity Dividend Growth Fund), which were approved by shareholders of
Fidelity Blue Chip Growth Fund, Fidelity Growth & Income Portfolio
Fund, and Fidelity OTC Portfolio on November __, 198_ and on ____ __,
199_ by FMR then the sole shareholder of Fidelity Dividend Growth Fund. For
the services of FMR under each fund's contract, each fund pays FMR a
monthly management fee composed of the sum of a group fee rate and an
individual fund fee rate (the "basic fee").
COMPUTING THE BASIC FEE. Each fund's basic fee rate is 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 on the left. On the right, the effective annual fee rate
schedule, are the actual results of cumulatively applying the annualized
rates at varying asset levels. For example, the effective annual fee rate
at $253 billion of group net assets - their approximate level for March
1994 - was .3220%, which is the weighted average of the respective fee
rates for each level of group net assets up to that level.
GROUP FEE RATE SCHEDULE* EFFECTIVE ANNUAL FEE RATES
Average Annualized Group Effective
Group Fee Rate Net Annual
Assets Assets Fee Rate
0 - $ 3 billion .520% $ 0.5 billion .5200%
3 - 6 .490 25 .4238
6 - 9 .460 50 .3823
9 - 12 .430 75 .3626
12 - 15 .400 100 .3512
15 - 18 .385 125 .3430
18 - 21 .370 150 .3371
21 - 24 .360 175 .3325
24 - 30 .350 200 .3284
30 - 36 .345 225 .3253
36 - 42 .340 250 .3223
42 - 48 .335 275 .3198
48 - 66 .325 300 .3175
66 - 84 .320 325 .3153
84 - 120 .315 350 .3133
102 - 138 .310
138 - 174 .305
174 - 228 .300
228 - 282 .295
282 - 336 .290
Over 336 .285
* The rates shown above for average group assets in excess of $102 billion
were adopted by FMR on a voluntary basis on _________ pending shareholder
approval of a new management contract reflecting the extended schedule. The
rates shown for average group assets in excess of $138 billion were adopted
by FMR on a voluntary basis on January 1, 1992 pending shareholder approval
of a new management contract reflecting the extended schedule. The rates
shown for average group assets in excess of $174 billion were adopted by
FMR on a voluntary basis on November 1, 1993 pending shareholder approval
of a new management contract reflecting the extended schedule. The extended
schedules provides for lower management fees as total assets under
management increase.
The individual fund fee rate is .30% for Fidelity Blue Chip Growth Fund
and Dividend Growth Fund, .20% for Fidelity Growth & Income Portfolio,
and .35% for Fidelity OTC Portfolio. Based on the average net assets of
funds advised by FMR for April 1994, the annual basic fee rate would be
calculated as follows:
GROUP FEE INDIVIDUAL FUND BASIC
RATE FEE RATE FEE RATE
Fidelity Blue Chip .3220% + .30% = .6220%
Growth Fund
Fidelity Dividend
Growth Fund* .3220% + .30% = .6220%
Fidelity Growth
& Income Portfolio .3220% + .20% = .5220%
Fidelity OTC Portfolio .3220% + .35% = .6720%
* From April 28, 1994 (commencement of operations).
One twelfth (1/12) of this annual basic fee rate is then applied to the
fund's average net assets for the current month, giving a dollar amount
which is the fee for that month.
COMPUTING THE PERFORMANCE ADJUSTMENT FOR FIDELITY BLUE CHIP GROWTH FUND,
FIDELITY DIVIDEND GROWTH FUND, AND FIDELITY OTC PORTFOLIO. The basic fee
for these funds are subject to upward or downward adjustment, depending
upon whether, and to what extent, each fund's investment performance for
the performance period exceeds, or is exceeded by, the record of the For
Blue Chip Growth Fund and Dividend Growth Fund: Standard & Poor's 500
Composite Stock Price Index (S&P 500); For OTC Portfolio: the NASDQ
Index (the NASDQ) over the same period. The performance period consists of
the most recent month plus the previous 35 months. Each percentage point of
difference (up to a maximum difference of + 10) 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 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 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 S&P 500
and the NASDQ are based on change in value and is adjusted for any cash
distributions from the companies whose securities compose the S&P 500
(Blue Chip Growth Fund and Dividend Growth Fund) or the NASDQ (OTC
Portfolio).
Because the adjustment to the basic fee is based on each fund's
performance compared to the investment record of the S&P 500 (Blue Chip
Growth Fund and Dividend Growth Fund) or the NASDQ (OTC Portfolio), the
controlling factor is not whether each fund's performance is up or down per
se, but whether it is up or down more or less than the record of the
S&P 500 (Blue Chip Growth Fund and Dividend Growth Fund) or the NASDQ
(OTC Portfolio). Moreover, the comparative investment performance of a fund
is based solely on the relevant performance period without regard to the
cumulative performance over a longer or shorter period of time.
MANAGEMENT FEES. For the fiscal year ended July 31, FMR received payments
from each fund as shown in the following table for its services as
investment adviser, including any applicable performance adjustment. If FMR
had not voluntarily adopted the extended group fee rate schedule, these
fees would have been higher.
Fidelity Blue Chip Growth Fund
Management Fee Management
Including Fee as a Performance
Fiscal Year Ended Performance % of Average Adjustment
July 31 Adjustment Net Assets to Basic Fee
1993 $ _________ .__% $ __________
1992 $ _________ .__% $ __________
1991 $ _________ .__% $ __________
Fidelity Dividend Growth Fund*
Management Fee Management
Including Fee as a Performance
Fiscal Year Ended Performance % of Average Adjustment
July 31 Adjustment Net Assets to Basic Fee
1993 $ _________ .__% $ __________
* From April 28, 1994 (commencement of operations).
Fidelity Growth & Income
Portfolio
Management Fee Management
Including Fee as a
Fiscal Year Ended Performance % of Average
July 31 Adjustment Net Assets
1993 $ _________ .__%
1992 $ _________ .__%
1991 $ _________ .__%
Fidelity OTC Portfolio
Management Fee Management
Including Fee as a Performance
Fiscal Year Ended Performance % of Average Adjustment
July 31 Adjustment Net Assets to Basic Fee
1993 $ _________ .__% $ __________
1992 $ _________ .__% $ __________
1991 $ _________ .__% $ __________
To comply with the California Code of Regulations, FMR will reimburse each
fund if and to the extent that the fund's aggregate annual operating
expenses exceed specified percentages of its average net assets. The
applicable percentages are 2 1/2% of the first $30 million, 2% of the next
$70 million, and 1 1/2% of average net assets in excess of $100 million.
When calculating each fund's expenses for purposes of this regulation, the
funds may exclude interest, taxes, brokerage commissions, and extraordinary
expenses, as well as a portion of its custodian fees attributable to
investments in foreign securities.
ACTIVITIES AND MANAGEMENT OF FMR
FMR, a corporation organized in 1946, serves as investment adviser to a
number of investment companies whose net assets as of March 31, 1994, were
in excess of $250 billion. The Fidelity family of funds currently includes
a number of funds with a broad range of investment objectives and
permissible portfolio compositions. The Boards of these funds are
substantially identical to that of this trust. In addition, FMR serves as
investment adviser to certain other funds which are generally offered to
limited groups of investors. Information concerning the advisory fees, net
assets, and total expenses of the funds advised by FMR is contained in the
Table of Average Net Assets and Expense Ratios in Exhibit 6.
Several affiliates of FMR are also engaged in the investment advisory
business. Fidelity Management Trust Company provides trustee, investment
advisory, and administrative services to retirement plans and corporate
employee benefit accounts. Fidelity Management & Research (U.K.) Inc.
(FMR U.K.) and Fidelity Management & Research (Far East) Inc. (FMR Far
East), both wholly owned subsidiaries of FMR formed in 1986, supply
investment research information, and may supply portfolio management
services to FMR in connection with certain funds advised by FMR. FMR Texas
Inc., a wholly owned subsidiary of FMR formed in 1989, supplies portfolio
management and research services in connection with certain money market
funds advised by FMR.
FMR, its officers and directors, its affiliated companies and personnel,
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 which 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 Consolidated Statement of Financial Condition of Fidelity Management
& Research Company and Subsidiaries as of December 31, 1992 is shown
beginning on page ___.
The Directors of FMR are Edward C. Johnson 3d, Chairman of the Board; and
J. Gary Burkhead, President. Each of the Directors is also a Trustee of the
trust. Messrs. Johnson 3d, Burkhead, John H. Costello, Steven Kaye, Alan
Radlo, Gary L. French, and Arthur S. Loring, are currently officers of the
fund and officers or employees of FMR or FMR Corp. With the exception of
Messrs. Costello and French, all of these persons are stockholders of FMR
Corp. FMR's address is 82 Devonshire Street, Boston, Massachusetts 02109,
which is also the address of the Directors of FMR.
All of the stock of FMR is owned by a parent company, FMR Corp., 82
Devonshire Street, Boston, Massachusetts 02109, which was organized on
October 31, 1972. At present, the principal operating activities of FMR
Corp. are those conducted by three of its divisions, Fidelity Service Co.,
which is the transfer, shareholder servicing, and pricing and bookkeeping
agent for certain of the retail funds advised by FMR, Fidelity Investments
Institutional Operations Company, which performs shareholder servicing
functions for certain institutional customers, and Fidelity Investments
Retail Services Company, which provides marketing services to various
companies within the Fidelity organization. Messrs. Johnson 3d, Burkhead,
William L. Byrnes, James C. Curvey, and Caleb Loring, Jr. are the Directors
of FMR Corp. On August 31, 1993, Messrs. Johnson 3d, Burkhead, Curvey, and
Loring, Jr., and Ms. Abigail Johnson owned approximately 34%, 3%, 3%, 11%,
and 11%, respectively, of the voting common stock of FMR Corp. In addition,
various Johnson family members and various trusts for the benefit of
Johnson family members, for which Messrs. Burkhead, Curvey, or Loring, Jr.
are Trustees, owned in the aggregate 32% of the voting common stock of FMR
Corp. Messrs. Johnson 3d, Burkhead, and Curvey owned approximately 2%, 3%,
and 1%, respectively, of the non-voting common stock of FMR Corp. In
addition, various trusts for the benefit of members of the Johnson family,
for which Mr. Loring, Jr. is the sole Trustee, and other trusts for the
benefit of Johnson family members, through limited partnership interests in
a partnership the corporate general partner of which is controlled by Mr.
Johnson 3d, Mr. Loring, Jr., and other Johnson family members, together
owned approximately 44% of the non-voting common stock of FMR Corp. Through
ownership of voting common stock, Edward C. Johnson 3d (President and a
Trustee of the trust), Johnson family members, and various trusts for the
benefit of the Johnson family form a controlling group with respect to FMR
Corp.
During the period December 1, 1991 through August 31, 1993, the following
transactions were entered into by officers and/or Trustees of the funds or
of FMR Corp. involving more than 1% of the voting common, non-voting common
or preferred stock of FMR Corp. Mr. William L. Byrnes redeemed 410 shares
of voting common stock for a cash payment of approximately $44,000. Mr.
John J. Cook Jr. redeemed 10,000 shares of non-voting common stock for a
cash payment of approximately $1.1 million. Mr. C. Bruce Johnstone sold an
aggregate of 12,920 shares of preferred stock at a net price below their
net asset value to Harvard & Co. for a cash payment of approximately
$5.3 million and redeemed an aggregate of 25,500 shares of non-voting
common stock for an aggregate cash payment of approximately $3.4 million.
Mr. Morris J. Smith redeemed 15,000 shares of non-voting common stock for a
cash payment of approximately $1.8 million.
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 investment research information with respect to certain
funds for which FMR acts as investment adviser. Under sub-advisory
agreements with FMR U.K. and FMR Far East, FMR pays fees equal to 110% of
FMR U.K.'s costs and 105% of FMR Far East's costs, respectively, in
connection with research services provided for the benefit of certain
Fidelity funds. During the fiscal year ended July 31, 1993, no fees were
paid to FMR Far East or FMR U.K. on behalf of each of the funds.
The Statements of Financial Condition of FMR U.K. and FMR Far East as of
December 31, 1993 are shown on pages and __, respectively. Funds 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
(Exhibit _) on page __.
The Directors of FMR U.K. and FMR Far East are Edward C. Johnson 3d,
Chairman, and J. Gary Burkhead, President. The affiliations of Messrs.
Johnson 3d and Burkhead are described in Proposal 1. The principal business
address of the Directors and FMR U.K. and FMR Far East is 82 Devonshire
Street, Boston, Massachusetts.
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 its
management contract. FMR is also responsible for the placement of
transaction orders for other investment companies and accounts for which it
or its affiliates act as investment adviser. In selecting broker-dealers,
subject to applicable limitations of the federal securities laws, FMR will
consider various relevant factors, including, but not limited to, the size
and type of the transaction; the nature and character of the markets for
the security to be purchased or sold; the execution efficiency, settlement
capability, and financial condition of the broker-dealer firm; the
broker-dealer's execution services rendered on a continuing basis; and the
reasonableness of any commissions. Commissions for foreign investments
traded on foreign exchanges generally will be higher than for U.S.
investments traded on domestic exchanges and may not be subject to
negotiation.
Each fund may execute portfolio transactions with broker-dealers who
provide research and execution services to the funds or other accounts over
which FMR or its affiliates exercise investment discretion. Such services
may include advice concerning the value of securities; the advisability of
investing in, purchasing, or selling securities; the availability of
securities or the purchasers or sellers of securities; furnishing analyses
and reports concerning issuers, industries, securities, economic factors
and trends, portfolio strategy, and performance of accounts; and effecting
securities transactions and performing functions incidental thereto (such
as clearance and settlement). The selection of such broker-dealers is
generally made by FMR (to the extent possible consistent with execution
considerations) in accordance with a ranking of broker-dealers determined
periodically by FMR's investment staff based upon the quality of research
and execution services provided.
The receipt of research from broker-dealers that execute transactions on
behalf of the funds may be useful to FMR in rendering investment management
services to the funds or its other clients, and conversely, such research
provided by broker-dealers who have executed transaction orders on behalf
of other FMR clients may be useful to FMR in carrying out its obligations
to the funds. The receipt of such research has not reduced FMR's normal
independent research activities; however, it enables FMR to avoid the
additional expenses that could be incurred if FMR tried to develop
comparable information through its own efforts.
Subject to applicable limitations of the federal securities laws,
broker-dealers may receive commissions for agency transactions that are in
excess of the amount of commissions charged by other broker-dealers in
recognition of their research and execution services. In order to cause the
fund to pay such higher commissions, FMR must determine in good faith that
such commissions are reasonable in relation to the value of the brokerage
and research services provided by such executing broker-dealers, viewed in
terms of a particular transaction or FMR's overall responsibilities to the
funds and its other clients. In reaching this determination, FMR will not
attempt to place a specific dollar value on the brokerage and research
services provided, or to determine what portion of the compensation should
be related to those services.
FMR is authorized to use research services provided by and to place
portfolio transactions with brokerage firms that have provided assistance
in the distribution of shares of the funds or shares of other Fidelity
funds to the extent permitted by law. FMR may use research services
provided by and place agency transactions with Fidelity Brokerage Services,
Inc. (FBSI) and Fidelity Brokerage Services. Ltd. (FBSL), 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 September 4, 1992, FBSL operated under the name
Fidelity Portfolio Services, Ltd. (FPSL) as a wholly owned subsidiary of
Fidelity International Limited (FIL). Edward C. Johnson 3d is Chairman of
FIL. Mr. Johnson 3d, together with various trusts for the benefit of
Johnson family members, owns directly or indirectly more than 25% of the
voting common stock of FIL.
Section 11(a) of the Securities Exchange Act of 1934 prohibits members of
national securities exchanges from executing exchange transactions for
accounts which they or their affiliates manage, except in accordance with
SEC regulations. Pursuant to such regulations, the Board of Trustees has
approved a written agreement that permits FBSI to effect portfolio
transactions on national securities exchanges and to retain compensation in
connection with such transactions.
The Trustees periodically review FMR's performance of its responsibilities
in connection with the placement of portfolio transactions on behalf of the
funds and review the commissions paid by each fund over representative
periods of time to determine if they are reasonable in relation to the
benefits to that fund.
Each fund's annual portfolio turnover rate for the fiscal years ended July
31, 1993 and 1992 are represented in the table below.
Annual Portfolio Turnover Rates
1993 1992
Fidelity Blue Chip Growth Fund 319% 71%
Fidelity Dividend Growth Fund* 90% N/A
Fidelity Growth & Income Portfolio 87% 221%
Fidelity OTC Portfolio 213% 245%
* From April 28, 1993 (commencement of operations).
The tables below list the total brokerage commissions paid; the percentage
of brokerage commissions paid to brokerage firms that provided research
services; the total dollar value of brokerage commissions paid to firms
that provided research service, and the commissions paid to FBSI and FBSL
in dollars and as a percentage of the dollar value of all transactions in
which brokerage commissions were paid for the fiscal year ended July 31,
1993 for each of the funds. The differences in the percentage of brokerage
commissions paid to FBSI and FBSL and the percentage of transactions
effected through FBSI and FBSL are a result of low commission rates charged
by FBSI and FBSL in comparison to those charged by unaffiliated
broker-dealers. The funds did not pay any commissions to FBSL during the
periods shown.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
Total % Paid to Amount
Commissions Firms Paid to Firms
Providing Providing
Research Research
Fidelity Blue Chip Growth Fund $3,674,349 61% $2,229,000
Fidelity Dividend Growth Fund* $ 13,612 30% $ 4,062
Fidelity Growth & Income Portfolio $9,025,113 64% $5,748,104
Fidelity OTC Portfolio $1,524,104 69% $1,050,919
</TABLE>
* From April 28, 1993 (commencement of operations).
<TABLE>
<CAPTION>
<S> <C> <C> <C>
To % To Transactions
FBSI FBSI Through
FBSI
Fidelity Blue Chip Growth Fund $ 1,117,533 32% 42%
Fidelity Dividend Growth Fund $ 8,520 63% 80%
Fidelity Growth & Income Portfolio $2,771,799 31% 44%
Fidelity OTC Portfolio $ 84,000 6% 8%
</TABLE>
* From April 28, 1993 (commencement of operations).
From time to time the Trustees will review whether the recapture for the
benefit of the funds of some portion of the brokerage commissions or
similar fees paid by each fund on portfolio transactions is legally
permissible and advisable. Each fund seeks to recapture soliciting
broker-dealer fees on the tender of portfolio securities, but at present no
other recapture arrangements are in effect. The Trustees intend to continue
to review whether recapture opportunities are available and are legally
permissible and, if so, to determine, in the exercise of their business
judgment, whether it would be advisable for a fund to seek such recapture.
Although the Trustees and officers of the funds are substantially the same
as those of other funds managed by FMR, investment decisions for each fund
are made independently from those of other funds managed by FMR or accounts
managed by FMR affiliates. It sometimes happens that the same security is
held in the portfolio of more than one of these funds or accounts.
Simultaneous transactions are inevitable when several funds are managed by
the same investment adviser, particularly when the same security is
suitable for the investment objective of more than one fund.
When two or more funds are simultaneously engaged in the purchase or sale
of the same security, the prices and amounts are allocated in accordance
with a formula considered by the officers of the funds involved to be
equitable to each fund. In some cases, this system could have a detrimental
effect on the price or value of a security as far as the funds are
concerned. In other cases, however, the ability of the funds to participate
in volume transactions will produce better executions and prices for each
fund. It is the current opinion of the Trustees that the desirability of
retaining FMR as investment adviser to the funds outweighs any
disadvantages that may be said to exist from exposure to simultaneous
transactions.
CONTRACTS WITH COMPANIES AFFILIATED WITH FMR
Fidelity Service Co. (FSC) is transfer, dividend disbursing, and
shareholders' servicing agent for the funds. Under each fund's contract
with FSC, the fund pays an annual fee of $25.50 per basic retail account
with a balance of $5,000 or more, $15.00 per basic retail account with a
balance of less than $5,000, and a supplemental activity charge of $5.61
for monetary transactions. These fees and charges are subject to annual
cost escalation based on postal rate changes and changes in wage and price
levels as measured by the National Consumer Price Index for Urban Areas.
With respect to certain institutional client master accounts, each fund
pays FSC a per-account fee of $95.00 and monetary transaction charges of
$20.00 and $17.50, depending on the nature of services provided. Fees for
certain institutional retirement plan accounts are based on the net assets
of all such accounts in the fund.
Under each fund's contract, FSC pays out-of-pocket expenses associated
with providing transfer agent services. In addition, FSC bears the expense
of typesetting, printing, and mailing prospectuses, statements of
additional information, and all other reports, notices, and statements to
shareholders, with the exception of proxy statements.
The transfer agent fees paid to FSC by each fund for the fiscal periods
ended July 31, 1993, 1992, and 1991 are shown in the table below.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
1993 1992 1991
Fidelity Blue Chip Growth Fund $ 2,551,997 $1,429,568 $ 486,117
Fidelity Dividend Growth Fund* 17,233 N/A N/A
Fidelity Growth & Income Portfolio 13,840,000 9,357,000 5,395,000
Fidelity OTC Portfolio 2,589,993 2,043,93?
* From April 28, 1993 (commencement of operations). 3,350,000
</TABLE>
The trust's contract with FSC also provides that FSC will perform the
calculations necessary to determine each fund's net asset value per share
and dividends and maintain each fund's accounting records. Prior to July 1,
1991, the annual fee for these pricing and bookkeeping services was based
on two schedules: one pertaining to the fund's average net assets, and one
pertaining to the type and number of transactions the fund made. The fee
rates in effect as of July 1, 1991 are based on each fund's average net
assets, specifically, .06% for the first $500 million of average net assets
and .03% for average net assets in excess of $500 million. The fee is
limited to a minimum of $45,000 and a maximum of $750,000 per year. For
fiscal 1993, 1992, and 1991, the fees paid by each fund to FSC for pricing
and bookkeeping services (including related out-of-pocket expenses) are
shown in the following table.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
1993 1992 1991
Fidelity Blue Chip Growth Fund $ 329,688 $ 202,548 $ 96,084
Fidelity Dividend Growth Fund 11,610 N/A N/A
Fidelity Growth & Income Portfolio 773,000 768,000 373,000
Fidelity OTC Portfolio 517,000 462,637 223,492
</TABLE>
* From April 28, 1993 (commencement of operations).
FSC also receives fees for administering the fund's securities lending
program. Securities lending fees are based on the number and duration of
individual securities loans. The following table shows the brokerage
securities lending fees paid by each fund for fiscal years ending July 31,
1993, 1992, and 1991. Fidelity Equity-Income II Fund paid no brokerage
securities lending fees during these periods.
<TABLE>
<CAPTION>
<S> <C> <C> <C>
1993 1992 1991
Fidelity Blue Chip Growth Fund $ 0 $ 0 $ 0
Fidelity Dividend Growth Fund 0 N/A N/A
Fidelity Growth & Income Portfolio 18,000 0 0
Fidelity OTC Portfolio 0 0 0
</TABLE>
* From April 28, 1993 (commencement of operations).
Each fund has a distribution agreement with Fidelity Distributors
Corporation (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 each
fund, which are continuously offered at net asset value. Promotional and
administrative expenses in connection with the offer and sale of shares are
paid by FMR.
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 Co., 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.
(TO BE UPDATED)
FIDELITY MANAGEMENT & RESEARCH COMPANY
(A WHOLLY-OWNED SUBSIDIARY OF FMR CORP.)
CONSOLIDATED STATEMENT OF FINANCIAL CONDITION
SEPTEMBER 30, 1993
(UNAUDITED)
(IN THOUSANDS)
________
ASSETS
Cash and cash equivalents $ 117
Management fees receivable 94,523
Managed funds (market value $78,836) 69,808
Property and equipment, net 112,898
Deferred income taxes 15,389
Other investments 3,209
Prepaid expenses and other assets 5,741
Prepaid income taxes 177
Total Assets $ 301,862
LIABILITIES AND STOCKHOLDER'S EQUITY
Payable to mutual funds $ 10,946
Accounts payable and accrued expenses 83,481
Payable to parent company 116,832
Other liabilities 2,571
Total Liabilities 213,830
Stockholder's equity:
Common stock, $.30 par value;
authorized 50,000 shares;
issued and outstanding
26,500 shares 8
Additional paid-in capital 38,824
Retained earnings 49,200
Total Stockholder's Equity 88,032
Total Liabilities and Stockholder's Equity $ 301,862
The accompanying notes are an integral part
of the consolidated statement of financial condition.
(TO BE UPDATED)
FIDELITY MANAGEMENT & RESEARCH COMPANY
(A WHOLLY-OWNED SUBSIDIARY OF FMR CORP.)
NOTES TO CONSOLIDATED STATEMENT
OF FINANCIAL CONDITION
(UNAUDITED)
________
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
Fidelity Management & Research Company and Subsidiaries (the Company)
provide investment management and advisory services and other services
principally for the Fidelity Investments Family of Funds. The Company also
provides computer support and systems development services to affiliated
companies.
PRINCIPLES OF CONSOLIDATION
The consolidated statement of financial condition includes the accounts of
Fidelity Management & Research Company and its wholly-owned
subsidiaries. All intercompany accounts have been eliminated.
INVESTED ASSETS
Managed funds investments (consisting primarily of Fidelity Mutual Funds)
are carried at the lower of aggregate cost or market. Other invested assets
consist primarily of an investment in a limited partnership which is
carried at cost. Certain restrictions exist with respect to the sale or
transfer of this investment to third parties. For managed funds investments
and other securities, fair value is determined by the quoted market price
except in the case of restricted investments which are valued based on
management's assessment of fair value. When the Company has determined that
an impairment, which is deemed other than temporary, in the market or fair
value of an invested asset has occurred, the carrying value of the
investment is reduced to its net realizable value.
INCOME TAXES
The Company is included in the consolidated federal and state income tax
returns of FMR Corp. Deferred income taxes are allocated to the Company by
FMR Corp. as a direct charge (credit) and arise due to the differences in
the timing of recognition of certain items of income and expense for tax
and financial reporting purposes.
In 1993, the Company adopted the Financial Accounting Standards Board
Statement of Financial Accounting Standards No. 109, "Accounting for Income
Taxes" (the Statement). The principles of the Statement were applied
retroactively, and did not have a material affect on the Company's
consolidated financial position.
FIDELITY MANAGEMENT & RESEARCH COMPANY
(A WHOLLY-OWNED SUBSIDIARY OF FMR CORP.)
NOTES TO CONSOLIDATED STATEMENT
OF FINANCIAL CONDITION
(UNAUDITED)
(CONTINUED)
________
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED:
PROPERTY AND EQUIPMENT
Property and equipment are stated at cost less accumulated depreciation and
amortization. Depreciation of furniture and equipment is computed over the
estimated useful lives of the related assets, which are principally three
to five years, using the straight-line method. Leasehold improvements are
amortized over the lesser of their economic useful lives or the period of
the lease. Maintenance and repairs are charged to operations when incurred.
Renewals and betterments of a nature considered to materially extend the
useful life of the assets are capitalized.
PENSION AND PROFIT SHARING PLANS
The Company participates in FMR Corp.'s noncontributory defined benefit
pension plan covering all of its eligible employees. There are no
statistics available for the actuarial data of this separate company.
The Company also participates in FMR Corp.'s defined contribution profit
sharing and retirement plans covering substantially all eligible employees.
B. PROPERTY AND EQUIPMENT, NET
At September 30, 1993, property and equipment, at cost, consists of (in
thousands):
Furniture $ 1,853
Equipment (principally computer related) 276,647
Leasehold improvements 5,859
284,359
Less: Accumulated depreciation and amortization 171,461
$ 112,898
C. TRANSACTIONS WITH AFFILIATED COMPANIES
In connection with its operations, the Company provides services to and
obtains services from affiliated companies. Transactions related to these
services are settled, in the normal course of business, through an
intercompany account with the Company's parent, FMR Corp. The terms of
these transactions may not be the same as those which would otherwise exist
or result from agreements and transactions among unrelated parties.
FIDELITY MANAGEMENT & RESEARCH COMPANY
(A WHOLLY-OWNED SUBSIDIARY OF FMR CORP.)
NOTES TO CONSOLIDATED STATEMENT
OF FINANCIAL CONDITION
(UNAUDITED)
(CONTINUED)
________
D. TRANSFER OF SUBSIDIARY
On March 1, 1993, a significant subsidiary of the Company, Fidelity
Investments Institutional Services Company, Inc. was transferred to the
Company's parent. As of March 1, 1993, this subsidiary had net worth and
total assets of approximately $53,000,000, and $70,000,000, respectively.
TO BE UPDATED
FIDELITY MANAGEMENT & RESEARCH (FAR EAST) INC.
(A WHOLLY-OWNED SUBSIDIARY OF
FIDELITY MANAGEMENT & RESEARCH COMPANY)
STATEMENT OF FINANCIAL CONDITION
SEPTEMBER 30, 1993
(UNAUDITED)
ASSETS
Cash $ 19,146
Investments (market value $603,714) 555,702
Furniture and equipment, net of
accumulated depreciation of $10,582 764
Prepaid expenses and other assets 143,499
Receivable from parent company 30,491
Total Assets $ 749,602
LIABILITIES AND STOCKHOLDER'S EQUITY
Liabilities:
Payable to affiliate $ 50,700
Income taxes payable 109,967
Total Liabilities 160,667
Stockholder's equity:
Common stock, $1, par value;
authorized 300,000 shares;
issued and outstanding 100 shares 100
Additional paid-in capital 900
Retained earnings 587,935
Total Stockholder's Equity 588,935
Total Liabilities and Stockholder's Equity $ 749,602
The accompanying notes are an integral part
of the consolidated statement of financial condition.
FIDELITY MANAGEMENT & RESEARCH (FAR EAST) INC.
(A WHOLLY-OWNED SUBSIDIARY OF
FIDELITY MANAGEMENT & RESEARCH COMPANY)
NOTES TO STATEMENT OF FINANCIAL CONDITION
(UNAUDITED)
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
BUSINESS
Fidelity Management & Research (Far East) Inc. (the Company) is a
wholly-owned subsidiary of Fidelity Management & Research Company (the
parent). The Company provides investment research advice under a
subadvisory agreement with its parent.
The Company is a registered investment advisor and receives fees from its
parent for the services provided. Intercompany transactions are settled
during the normal course of business.
INVESTMENTS
Investments consist of shares held in a Fidelity mutual fund and are
carried at the lower of cost or market. The fair value of investments is
equal to the quoted market price.
FURNITURE AND EQUIPMENT
Furniture and equipment are stated at cost less accumulated depreciation.
Depreciation is computed over the estimated useful lives of the related
assets, which vary from three to five years, using the straight-line
method. Maintenance and repairs are charged to operations when incurred.
INCOME TAXES
The Company is included in the consolidated federal and state income tax
returns of FMR Corp., the parent company of Fidelity Management &
Research Company. The Company is assessed a charge by FMR Corp. at the
higher of the U.S. statutory income tax rate or the applicable foreign
statutory income tax rates based upon its pretax accounting income adjusted
for permanent book/tax differences, if any.
(TO BE UPDATED)
FIDELITY MANAGEMENT & RESEARCH (U.K.) INC.
(A WHOLLY-OWNED SUBSIDIARY OF
FIDELITY MANAGEMENT & RESEARCH COMPANY)
STATEMENT OF FINANCIAL CONDITION
SEPTEMBER 30, 1993
(UNAUDITED)
________
ASSETS
Investments at lower of cost or market
(market value $3,023,991) $ 2,482,897
Equipment, net of accumulated depreciation of $693,466 713,873
Accounts receivable from parent 3,129,092
Total Assets $ 6,325,862
LIABILITIES AND STOCKHOLDER'S EQUITY
Liabilities:
Subordinated loan $ 1,608,100
Accounts payable to affiliate 1,923,816
Income taxes payable 181,225
Other Liabilities 130
Total Liabilities 3,713,271
Stockholder's Equity:
Common stock, $1, par value;
authorized 300,000 shares;
issued and outstanding 100 shares 100
Additional paid-in capital 900
Retained earnings 2,611,591
Total Stockholder's Equity 2,612,591
Total Liabilities and Stockholder's Equity $ 6,325,862
The accompanying notes are an integral part
of the consolidated statement of financial condition.
FIDELITY MANAGEMENT & RESEARCH (U.K.) INC.
(A WHOLLY-OWNED SUBSIDIARY OF
FIDELITY MANAGEMENT & RESEARCH COMPANY)
NOTES TO STATEMENT OF FINANCIAL CONDITION
(UNAUDITED)
________
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES:
BASIS OF REPORTING
The financial statements are presented in accordance with United States
generally accepted accounting principles. The functional and reporting
currency for Fidelity Management & Research (U.K.) Inc. (the Company)
is the U.S. dollar.
BUSINESS
The Company is a wholly-owned subsidiary of Fidelity Management &
Research Company (the parent). The Company is a registered investment
advisor and provides research and investment advisory services under
subadvisory agreements with its parent. The Company also provides research
advice to the parent and an affiliate pursuant to a research joint venture
agreement.
REVENUE RECOGNITION
Fees earned from management and investment advisory services provided to
mutual funds are recognized as earned and shared equally with the parent.
Research joint venture fees are charged to the parent and an affiliate
based on a cost plus fee arrangement. Intercompany transactions are settled
during the normal course of business. Gains and losses from the sale of
invested assets are computed on a specific identified cost basis.
INVESTMENTS
Investments consist of shares held in Fidelity mutual funds and are carried
at the lower of aggregate cost or market. The fair value of investments is
equal to the quoted market price.
EQUIPMENT
Equipment is stated at cost less accumulated depreciation. Depreciation is
computed over the estimated useful lives of the related assets, which vary
from three to five years, using the straight-line method. Maintenance and
repairs are charged to operations when incurred.
FIDELITY MANAGEMENT & RESEARCH (U.K.) INC.
(A WHOLLY-OWNED SUBSIDIARY OF
FIDELITY MANAGEMENT & RESEARCH COMPANY)
NOTES TO FINANCIAL STATEMENTS
(UNAUDITED)
(CONTINUED)
________
A. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - CONTINUED:
SUBORDINATED LOAN
The Company has a subordinated loan payable to its parent and due on March
31, 1994. The loan is subordinated in all respects to the rights of senior
creditors. Interest is payable annually at a rate equal to LIBOR on the
date of the agreement. Repayment or modification of this loan is subject to
regulatory approval.
INCOME TAXES
The Company is included in the consolidated federal and state income tax
returns of FMR Corp., the parent company of Fidelity Management &
Research Company. The Company is assessed a charge by FMR Corp. at the
higher of the U.S. statutory income tax rate or the applicable foreign
statutory income tax rate based upon its pretax accounting income adjusted
for permanent book/tax differences, if any.
B. NET CAPITAL REQUIREMENT:
The Company is subject to certain financial regulatory resource rules which
require the Company to maintain a certain level of net capital (as
defined). At September 30, 1993, the minimum net capital requirement of
approximately $425,000 has been satisfied by the Company.
EXHIBIT 1
The proper name of each fund - Fidelity Blue Chip Growth Fund, and
Fidelity OTC Portfolio - will be inserted in each respective fund's
contract where indicated by (Name of Portfolio).
The language to be added to the current contract is underlined; the
language to be deleted is set forth in [brackets].
FORM OF
MANAGEMENT CONTRACT
BETWEEN
FIDELITY SECURITIES FUND:
(NAME OF PORTFOLIO)
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
MODIFICATION made this 1st day of [December, 1988] ((August, 1994)) by and
between Fidelity Securities Fund, 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").
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
modified ((Decmber 1, 1988,)) to a modification of said Contract in the
manner set forth below. ((The Modified Management Contract shall when
executed by duly authorized officers of the Fund and the Adviser, take
effect on the later of August 1, 1994 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 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)) [to the Basic Fee based upon the investment
performance of the Portfolio in relation to the] (For Blue Chip Growth
Fund: Standard & Poor's [Daily] ((Composite)) Stock Price Index [of 500
Composite Stocks]; (For OTC Portfolio: NASDQ Composite 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:
For Blue Chip Growth Fund:
(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:
For OTC Portfolio:
[BASIC FEE RATE:]
[The basic fee rate shall be composed of two elements:]
(((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:))
For Blue Chip Growth Fund and OTC Portfolio:
( 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)) [charter of each investment company] )
determined as of the close of business ((on each business)) day throughout
the month. The Group Fee Rate shall be determined on a cumulative basis
pursuant to the following schedule:
Average Net Assets Annualized Fee Rate (for each level)
$ 0 - 3 billion .520 %
3 - 6 .490
6 - 9 .460
9 - 12 .430
12 - 15 .400
15 - 18 .385
18 - 21 .370
21 - 24 .360
24 - 30 .350
30 - 36 .345
36 - 42 .340
42 - 48 .335
48 - 66 .325
66 - 84 .320
84 - 102 .315
[Over] 102 - ((138)) .310
((138 - 174)) ((.305))
((174 - 228)) ((.300))
((228 - 282)) ((.295))
((282 - 336)) ((.290))
((Over 336)) ((.285))
For Blue Chip Growth Fund:
( ii ) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be
.30%.
For OTC Portfolio:
( ii ) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be
.35%.
[The sum of the Group fee rate, calculated as described above to the
nearest millionth, and the Individual Portfolio fee rate shall constitute
the annual basic fee rate.]
For both funds:
(b) ((Basic Fee)) One-twelfth of the [annual] 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 [of the Fund] 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) [The] Performance Adjustment ((Rate)): [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 to or subtracted from the basic
fee depending on whether the portfolio experienced better or worse
performance than the performance index.] The Performance Adjustment Rate 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 percentage point) ) 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 [the first full day of the first full
month following the effective date of the Portfolio's registration
statement] ((with the effective date of this Contract.)) 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 securities [companies whose stocks comprise]
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.
[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 reduction in the fee wil 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.]
(d) ((Performance Adjustment.)) One-twelfth of the annual Performance
Adjustment Rate [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 permitted in paragraph 3(c)]
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 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.
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,
1989] ((July 31, 1995)) 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 ((for
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 [Funds](( 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
The proper name of each fund - Fidelity Dividend Growth Fund and Fidelity
Growth & Income Portfolio - will be inserted in each respective fund's
contract where indicated by (Name of Portfolio).
The language to be added to the current contract is underlined; the
language to be deleted is set forth in [brackets].
FORM OF
MANAGEMENT CONTRACT
BETWEEN
FIDELITY SECURITIES FUND:
FIDELITY SECURITIES FUND ON BEHALF OF
(NAME OF PORTFOLIO)
AND
FIDELITY MANAGEMENT & RESEARCH COMPANY
MODIFICATION[AGREEMENT] made this 1st day of August 1994 [15th day of
April 1993: for Dividend Growth], 1st day of [December 1988 for Growth
& Income], by and between Fidelity Securities Fund, 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").
New for Dividend Growth: 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 modified (Decmber 1, 1988 for Growth &
Income, dated April 15, 1993 for Dividend Growth), to a modification of
said Contract in the manner set forth below. The Modified Management
Contract shall when executed by duly authorized officers of the Fund and
the Adviser, take effect on the later of August 1, 1994 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.
For Growth & Income Portfolio:
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, shall be [computed as follows] composed of a Group
Fee and an Individual Fund Fee:
(a) Basic Fee Rate: The annual Basic Fee Rate shall be [composed of two
elements (i) The] 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 charter of each investment company or other
organizational document) determined as of the close of business on each
business day throughout the month. The Group Fee Rate shall be determined
on a cumulative basis pursuant to the following schedule:
Average Net Assets Annualized Fee Rate (for each level)
0 - $3 billion .520
3 - 6 .490
6 - 9 .460
9 - 12 .430
12 - 15 .400
15 - 18 .385
18 - 21 .370
21 - 24 .360
24 - 30 .350
30 - 36 .345
36 - 42 .340
42 - 48 .335
48 - 66 .325
66 - 84 .320
84 - 102 .315
[Over] 102 - 138 .310
138 - 174 .305
174 - 228 .300
228 - 282 .295
282 - 336 .290
Over 336 .285
[(ii)] (b) Individual Fund Fee Rate. The Individual [portfolio] Fund Fee
Rate shall be .20%.
The sum of the [cumulative] Group Fee Rate, calculated as described
above to the nearest millionth, and the Individual [Portfolio] Fund Fee
Rate shall constitute the Annual [Management] Basic 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 [Article X
of] the Fund's Declaration of Trust [of the Fund]) determined as of the
close of business on each business day throughout the month.
(c) In the 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.
For Dividend Growth Fund:
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 to the Basic Fee based upon the investment performance of the
Portfolio in relation to the Standard & Poor's 500 Stock Price Index
(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 .520
3 - 6 .490
6 - 9 .460
9 - 12 .430
12 - 15 .400
15 - 18 .385
18 - 21 .370
21 - 24 .360
24 - 30 .350
30 - 36 .345
36 - 42 .340
42 - 48 .335
48 - 66 .325
66 - 84 .320
84 - 102 .315
102 - 138 .310
138 - 174 .305
[Over]174 - 228 .300
228 - 282 .295
282 - 336 .290
Over 336 .285
(ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be
.30%.
(b) Basic Fee. One-twelfth of the Basic Fee Rate shall be applied to
the average of the net assets of the Portfolio (computed in the manner set
forth in the Fund's Declaration of Trust determined as of the close of
business on each business day throughout the month. The resulting dollar
amount comprises the Basic Fee. This Basic Fee will be subject to upward or
downward adjustment on the basis of the Portfolio's investment performance
as follows:
(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 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 effective date of this
Contract. 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 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.
6. (a) Subject to prior termination as provided in sub-paragraph (d) of
this paragraph 6, this Contract shall continue in force until (For Growth
& Income: [July 31, 1990]; For Dividend Growth: [July 31, 1994] July
31, 1995, ) 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.
For all Funds:
(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 ((For
Growth & Income: 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
((For Growth & Income: or other organizational document)) are separate
and distinct from those of any and all other Portfolios.
For Growth & Income Portfolio:((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.))
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 __
FORM OF SUB-ADVISORY AGREEMENT
The following sub-advisory agreements will be adopted for Fidelity Blue
Chip Growth Fund, Fidelity Growth & Income Portfolio, and Fidelity OTC
Portfolio.
The proper name of each fund - Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio - will be
inserted in each respective fund's contract where indicated by (Name of
Portfolio).
SUB-ADVISORY AGREEMENT
BETWEEN
FIDELITY MANAGEMENT & RESEARCH COMPANY
AND
FIDELITY MANAGEMENT & RESEARCH (FAR EAST) INC.
AND
FIDELITY SECURITIES FUND ON BEHALF OF
(NAME OF PORTFOLIO)
AGREEMENT made this 1st day of August 1994, by and between Fidelity
Management & Research Company, a Massachusetts corporation with
principal offices at 82 Devonshire Street, Boston, Massachusetts
(hereinafter called the "Advisor"); Fidelity Management & Research (Far
East) Inc. (hereinafter called the "Sub-Advisor"); and Fidelity Securities
Fund, a Massachusetts business trust which may issue one or more series of
shares of beneficial interest (hereinafter called the "Trust") on behalf of
(Name of Portfolio) (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 to the Portfolio, and
WHEREAS the Sub-Advisor and its subsidiaries and other affiliated persons
have personnel in various locations throughout the world and have been
formed in part for the purpose of researching and compiling information and
recommendations with respect to the economies of various countries, and
securities of issuers located in such countries, and providing investment
advisory services in connection therewith;
NOW, THEREFORE, in consideration of the premises and the mutual promises
hereinafter set forth, the Trust, the Advisor and the Sub-Advisor agree as
follows:
1. Duties: The Advisor may, in its discretion, appoint the Sub-Advisor to
perform one or more of the following services with respect to all or a
portion of the investments of the Portfolio. The services and the portion
of the investments of the Portfolio to be advised or managed by the
Sub-Advisor shall be as agreed upon from time to time by the Advisor and
the Sub-Advisor. The Sub-Advisor shall pay the salaries and fees of all
personnel of the Sub-Advisor performing services for the Portfolio relating
to research, statistical and investment activities.
(a) INVESTMENT ADVICE: If and to the extent requested by the Advisor,
the Sub-Advisor shall provide investment advice to the Portfolio and the
Advisor with respect to all or a portion of the investments of the
Portfolio, and in connection with such advice shall furnish the Portfolio
and the Advisor such factual information, research reports and investment
recommendations, as the Adviser may reasonably require. Such information
may include written and oral reports and analyses.
(b) INVESTMENT MANAGEMENT: If and to the extent requested by the
Advisor, the Sub-Advisor shall, subject to the supervision of the Advisor,
manage all or a portion of the investments of the Portfolio in accordance
with the investment objective, policies and limitations provided in the
Portfolio's Prospectus or other governing instruments, as amended from time
to time, the Investment Company Act of 1940 (the "1940 Act") and rules
thereunder, as amended from time to time, and such other limitations as the
Trust or Advisor may impose with respect to the Portfolio by notice to the
Sub-Advisor. With respect to the portion of the investments of the
Portfolio under its management, the Sub-Advisor is authorized to make
investment decisions on behalf of the Portfolio with regard to any stock,
bond, other security or investment instrument, and to place orders for the
purchase and sale of such securities through such broker-dealers as the
Sub-Advisor may select. The Sub-Advisor may also be authorized, but only to
the extent such duties are delegated in writing by the Advisor, to provide
additional investment management services to the Portfolio, including but
not limited to services such as managing foreign currency investments,
purchasing and selling or writing futures and options contracts, borrowing
money, or lending securities on behalf of the Portfolio. All investment
management and any other activities of the Sub-Advisor shall at all times
be subject to the control and direction of the Advisor and the Trust's
Board of Trustees.
(c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or all
of the services contemplated by this Agreement directly or through such of
its subsidiaries or other affiliated persons as the Sub-Advisor shall
determine; provided, however, that performance of such services through
such subsidiaries or other affiliated persons shall have been approved by
the Trust to the extent required pursuant to the 1940 Act and rules
thereunder.
2. Information to be Provided to the Trust and the Advisor: The
Sub-Advisor shall furnish such reports, evaluations, information or
analyses to the Trust and the Advisor as the Trust's Board of Trustees or
the Advisor may reasonably request from time to time, or as the Sub-Advisor
may deem to be desirable.
3. Brokerage: In connection with the services provided under subparagraph
(b) of paragraph 1 of this Agreement, the Sub-Advisor, shall place all
orders for the purchase and sale of portfolio securities for the
Portfolio's account with brokers or dealers selected by the Sub-Advisor,
which may include brokers or dealers affiliated with the Advisor or
Sub-Advisor. The Sub-Advisor shall use its best efforts to seek to execute
portfolio transactions at prices which are advantageous to the Portfolio
and at commission rates which are reasonable in relation to the benefits
received. In selecting brokers or dealers qualified to execute a particular
transaction, brokers or dealers may be selected who also provide brokerage
and research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of l934) to the Portfolio and/or to the other
accounts over which the Sub-Advisor or Advisor exercise investment
discretion. The Sub-Advisor is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for executing a
portfolio transaction for the Portfolio which is in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction if the Sub-Advisor determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and
research services provided by such broker or dealer. This determination may
be viewed in terms of either that particular transaction or the overall
responsibilities which the Sub-Advisor has with respect to accounts over
which it exercises investment discretion. The Trustees of the Trust shall
periodically review the commissions paid by the Portfolio to determine if
the commissions paid over representative periods of time were reasonable in
relation to the benefits to the Portfolio.
4. Compensation: The Advisor shall compensate the Sub-Advisor on the
following basis for the services to be furnished hereunder.
(a) INVESTMENT ADVISORY FEE: For services provided under subparagraph
(a) of paragraph 1 of this Agreement, the Advisor agrees to pay the
Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory Fee shall be equal
to 105% of the Sub-Advisor's costs incurred in connection with rendering
the services referred to in subparagraph (a) of paragraph 1 of this
Agreement. The Sub-Advisory Fee shall not be reduced to reflect expense
reimbursements or fee waivers by the Advisor, if any, in effect from time
to time.
(b) INVESTMENT MANAGEMENT FEE: For services provided under subparagraph
(b) of paragraph 1 of this Agreement, the Advisor agrees to pay the
Sub-Advisor a monthly Investment Management Fee. The Investment Management
Fee shall be equal to: (i) 50% of the monthly management fee rate
(including performance adjustments, if any) that the Portfolio is obligated
to pay the Advisor under its Management Contract with the Advisor,
multiplied by: (ii) the fraction equal to the net assets of the Portfolio
as to which the Sub-Advisor shall have provided investment management
services divided by the net assets of the Portfolio for that month. If in
any fiscal year the aggregate expenses of the Portfolio exceed any
applicable expense limitation imposed by any state or federal securities
laws or regulations, and the Advisor waives all or a portion of its
management fee or reimburses the Portfolio for expenses to the extent
required to satisfy such limitation, the Investment Management Fee paid to
the Sub-Advisor will be reduced by 50% of the amount of such waivers or
reimbursements multiplied by the fraction determined in (ii). If the
Sub-Advisor reduces its fees to reflect such waivers or reimbursements and
the Advisor subsequently recovers all or any portion of such waivers and
reimbursements, then the Sub-Advisor shall be entitled to receive from the
Advisor a proportionate share of the amount recovered. To the extent that
waivers and reimbursements by the Advisor required by such limitations are
in excess of the Advisor's management fee, the Investment Management Fee
paid to the Sub-Advisor will be reduced to zero for that month, but in no
event shall the Sub-Advisor be required to reimburse the Advisor for all or
a portion of such excess reimbursements.
(c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have
provided both investment advisory services under subparagraph (a) and
investment management services under subparagraph (b) of paragraph 1 for
the same portion of the investments of the Portfolio for the same period,
the fees paid to the Sub-Advisor with respect to such investments shall be
calculated exclusively under subparagraph (b) of this paragraph 4.
5. Expenses: It is understood that the Portfolio will pay all of its
expenses other than those expressly stated to be payable by the Sub-Advisor
hereunder or by the Advisor under the Management Contract with the
Portfolio, which expenses payable by the Portfolio shall include, without
limitation, (i) interest and taxes; (ii) brokerage commissions and other
costs in connection with the purchase or sale of securities and other
investment instruments; (iii) fees and expenses of the Trust's Trustees
other than those who are "interested persons" of the Trust, the Sub-Advisor
or the Advisor; (iv) legal and audit expenses; (v) custodian, registrar and
transfer agent fees and expenses; (vi) fees and expenses related to the
registration and qualification of the Trust and the Portfolio's shares for
distribution under state and federal securities laws; (vii) expenses of
printing and mailing reports and notices and proxy material to shareholders
of the Portfolio; (viii) all other expenses incidental to holding meetings
of the Portfolio's shareholders, including proxy solicitations therefore;
(ix) a pro rata share, based on relative net assets of the Portfolio and
other registered investment companies having Advisory and Service or
Management Contracts with the Advisor, of 50% of insurance premiums for
fidelity and other coverage; (x) its proportionate share of association
membership dues; (xi) expenses of typesetting for printing Prospectuses and
Statements of Additional Information and supplements thereto; (xii)
expenses of printing and mailing Prospectuses and Statements of Additional
Information and supplements thereto sent to existing shareholders; and
(xiii) such non-recurring or extraordinary expenses as may arise, including
those relating to actions, suits or proceedings to which the Portfolio is a
party and the legal obligation which the Portfolio may have to indemnify
the Trust's Trustees and officers with respect thereto.
6. Interested Persons: It is understood that Trustees, officers, and
shareholders of the Trust are or may be or become interested in the Advisor
or the Sub-Advisor as directors, officers or otherwise and that directors,
officers and stockholders of the Advisor or the Sub-Advisor are or may be
or become similarly interested in the Trust, and that the Advisor or the
Sub-Advisor may be or become interested in the Trust as a shareholder or
otherwise.
7. Services to Other Companies or Accounts: The services of the
Sub-Advisor to the Advisor are not to be deemed to be exclusive, the
Sub-Advisor being free to render services to others and engage in other
activities, provided, however, that such other services and activities do
not, during the term of this Agreement, interfere, in a material manner,
with the Sub-Advisor's ability to meet all of its obligations hereunder.
The Sub-Advisor shall for all purposes be an independent contractor and not
an agent or employee of the Advisor or the Trust.
8. Standard of Care: In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations or duties hereunder
on the part of the Sub-Advisor, the Sub-Advisor shall not be subject to
liability to the Advisor, the Trust or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the purchase,
holding or sale of any security.
9. Duration and Termination of Agreement; Amendments:
(a) Subject to prior termination as provided in subparagraph (d) of this
paragraph 9, this Agreement shall continue in force until July 31, 1995 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, and their respective seals to be hereunto affixed, all as of
the date written above.
[SIGNATURE LINES OMITTED]
EXHIBIT __
FORM OF SUB-ADVISORY AGREEMENT
The following sub-advisory agreements will be adopted for Fidelity Blue
Chip Growth Fund, Fidelity Growth & Income Portfolio, and Fidelity OTC
Portfolio.
The proper name of each fund - Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio - will be
inserted in each respective fund's contract where indicated by (Name of
Portfolio).
SUB-ADVISORY AGREEMENT
BETWEEN
FIDELITY MANAGEMENT & RESEARCH COMPANY
AND
FIDELITY MANAGEMENT & RESEARCH (U.K.) INC.
AND
FIDELITY SECURITIES FUND ON BEHALF OF
(NAME OF PORTFOLIO)
AGREEMENT made this 1st day of August 1994 by and between Fidelity
Management & Research Company, a Massachusetts corporation with
principal offices at 82 Devonshire Street, Boston, Massachusetts
(hereinafter called the "Advisor"); Fidelity Management & Research
(U.K.) Inc. (hereinafter called the "Sub-Advisor"); and Fidelity Securities
Fund, a Massachusetts business trust which may issue one or more series of
shares of beneficial interest (hereinafter called the "Trust") on behalf of
(Name of Portfolio) (hereinafter called the "Portfolio").
WHEREAS the Trust and the Advisor have entered into a Management Contract
on behalf of the Portfolio, pursuant to which the Advisor is to act as
investment manager of the Portfolio; and
WHEREAS the Sub-Advisor and its subsidiaries and other affiliated persons
have personnel in various locations throughout the world and have been
formed in part for the purpose of researching and compiling information and
recommendations with respect to the economies of various countries, and
securities of issuers located in such countries, and providing investment
advisory services in connection therewith;
NOW, THEREFORE, in consideration of the premises and the mutual promises
hereinafter set forth, the Trust, the Advisor and the Sub-Advisor agree as
follows:
1. Duties: The Advisor may, in its discretion, appoint the Sub-Advisor to
perform one or more of the following services with respect to all or a
portion of the investments of the Portfolio. The services and the portion
of the investments of the Portfolio to be advised or managed by the
Sub-Advisor shall be as agreed upon from time to time by the Advisor and
the Sub-Advisor. The Sub-Advisor shall pay the salaries and fees of all
personnel of the Sub-Advisor performing services for the Portfolio relating
to research, statistical and investment activities.
(a) INVESTMENT ADVICE: If and to the extent requested by the Advisor,
the Sub-Advisor shall provide investment advice to the Portfolio and the
Advisor with respect to all or a portion of the investments of the
Portfolio, and in connection with such advice shall furnish the Portfolio
and the Advisor such factual information, research reports and investment
recommendations as the Advisor may reasonably require. Such information
may include written and oral reports and analyses.
(b) INVESTMENT MANAGEMENT: If and to the extent requested by the
Advisor, the Sub-Advisor shall, subject to the supervision of the Advisor,
manage all or a portion of the investments of the Portfolio in accordance
with the investment objective, policies and limitations provided in the
Portfolio's Prospectus or other governing instruments, as amended from time
to time, the Investment Company Act of 1940 (the "1940 Act") and rules
thereunder, as amended from time to time, and such other limitations as the
Trust or Advisor may impose with respect to the Portfolio by notice to the
Sub-Advisor. With respect to the portion of the investments of the
Portfolio under its management, the Sub-Advisor is authorized to make
investment decisions on behalf of the Portfolio with regard to any stock,
bond, other security or investment instrument, and to place orders for the
purchase and sale of such securities through such broker-dealers as the
Sub-Advisor may select. The Sub-Advisor may also be authorized, but only to
the extent such duties are delegated in writing by the Advisor, to provide
additional investment management services to the Portfolio, including but
not limited to services such as managing foreign currency investments,
purchasing and selling or writing futures and options contracts, borrowing
money or lending securities on behalf of the Portfolio. All investment
management and any other activities of the Sub-Advisor shall at all times
be subject to the control and direction of the Advisor and the Trust's
Board of Trustees.
(c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or all
of the services contemplated by this Agreement directly or through such of
its subsidiaries or other affiliated persons as the Sub-Advisor shall
determine; provided, however, that performance of such services through
such subsidiaries or other affiliated persons shall have been approved by
the Trust to the extent required pursuant to the 1940 Act and rules
thereunder.
2. Information to be Provided to the Trust and the Advisor: The
Sub-Advisor shall furnish such reports, evaluations, information or
analyses to the Trust and the Advisor as the Trust's Board of Trustees or
the Advisor may reasonably request from time to time, or as the Sub-Advisor
may deem to be desirable.
3. Brokerage: In connection with the services provided under subparagraph
(b) of paragraph 1 of this Agreement, the Sub-Advisor, shall place all
orders for the purchase and sale of portfolio securities for the
Portfolio's account with brokers or dealers selected by the Sub-Advisor,
which may include brokers or dealers affiliated with the Advisor or
Sub-Advisor. The Sub-Advisor shall use its best efforts to seek to execute
portfolio transactions at prices which are advantageous to the Portfolio
and at commission rates which are reasonable in relation to the benefits
received. In selecting brokers or dealers qualified to execute a particular
transaction, brokers or dealers may be selected who also provide brokerage
and research services (as those terms are defined in Section 28(e) of the
Securities Exchange Act of l934) to the Portfolio and/or to the other
accounts over which the Sub-Advisor or Advisor exercise investment
discretion. The Sub-Advisor is authorized to pay a broker or dealer who
provides such brokerage and research services a commission for executing a
portfolio transaction for the Portfolio which is in excess of the amount of
commission another broker or dealer would have charged for effecting that
transaction if the Sub-Advisor determines in good faith that such amount of
commission is reasonable in relation to the value of the brokerage and
research services provided by such broker or dealer. This determination may
be viewed in terms of either that particular transaction or the overall
responsibilities which the Sub-Advisor has with respect to accounts over
which it exercises investment discretion. The Trustees of the Trust shall
periodically review the commissions paid by the Portfolio to determine if
the commissions paid over representative periods of time were reasonable in
relation to the benefits to the Portfolio.
4. Compensation: The Advisor shall compensate the Sub-Advisor on the
following basis for the services to be furnished hereunder.
(a) INVESTMENT ADVISORY FEE: For services provided under subparagraph
(a) of paragraph 1 of this Agreement, the Advisor agrees to pay the
Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory Fee shall be equal
to 110% of the Sub-Advisor's costs incurred in connection with rendering
the services referred to in subparagraph (a) of paragraph 1 of this
Agreement. The Sub-Advisory Fee shall not be reduced to reflect expense
reimbursements or fee waivers by the Advisor, if any, in effect from time
to time.
(b) INVESTMENT MANAGEMENT FEE: For services provided under subparagraph
(b) of paragraph 1 of this Agreement, the Advisor agrees to pay the
Sub-Advisor a monthly Investment Management Fee. The Investment Management
Fee shall be equal to: (i) 50% of the monthly management fee rate
(including performance adjustments, if any) that the Portfolio is obligated
to pay the Advisor under its Management Contract with the Advisor,
multiplied by: (ii) the fraction equal to the net assets of the Portfolio
as to which the Sub-Advisor shall have provided investment management
services divided by the net assets of the Portfolio for that month. If in
any fiscal year the aggregate expenses of the Portfolio exceed any
applicable expense limitation imposed by any state or federal securities
laws or regulations, and the Advisor waives all or a portion of its
management fee or reimburses the Portfolio for expenses to the extent
required to satisfy such limitation, the Investment Management Fee paid to
the Sub-Advisor will be reduced by 50% of the amount of such waivers or
reimbursements multiplied by the fraction determined in (ii). If the
Sub-Advisor reduces its fees to reflect such waivers or reimbursements and
the Advisor subsequently recovers all or any portion of such waivers or
reimbursements, then the Sub-Advisor shall be entitled to receive from the
Advisor a proportionate share of the amount recovered. To the extent that
waivers and reimbursements by the Advisor required by such limitations are
in excess of the Advisor's management fee, the Investment Management Fee
paid to the Sub-Advisor will be reduced to zero for that month, but in no
event shall the Sub-Advisor be required to reimburse the Advisor for all or
a portion of such excess reimbursements.
(c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have
provided both investment advisory services under subparagraph (a) and
investment management services under subparagraph (b) of paragraph (1) for
the same portion of the investments of the Portfolio for the same period,
the fees paid to the Sub-Advisor with respect to such investments shall be
calculated exclusively under subparagraph (b) of this paragraph 4.
5. Expenses: It is understood that the Portfolio will pay all of its
expenses other than those expressly stated to be payable by the Sub-Advisor
hereunder or by the Advisor under the Management Contract with the
Portfolio, which expenses payable by the Portfolio shall include, without
limitation, (i) interest and taxes; (ii) brokerage commissions and other
costs in connection with the purchase or sale of securities and other
investment instruments; (iii) fees and expenses of the Trust's Trustees
other than those who are "interested persons" of the Trust, the Sub-Advisor
or the Advisor; (iv) legal and audit expenses; (v) custodian, registrar and
transfer agent fees and expenses; (vi) fees and expenses related to the
registration and qualification of the Trust and the Portfolio's shares for
distribution under state and federal securities laws; (vii) expenses of
printing and mailing reports and notices and proxy material to shareholders
of the Portfolio; (viii) all other expenses incidental to holding meetings
of the Portfolio's shareholders, including proxy solicitations therefore;
(ix) a pro rata share, based on relative net assets of the Portfolio and
other registered investment companies having Advisory and Service or
Management Contracts with the Advisor, of 50% of insurance premiums for
fidelity and other coverage; (x) its proportionate share of association
membership dues; (xi) expenses of typesetting for printing Prospectuses and
Statements of Additional Information and supplements thereto; (xii)
expenses of printing and mailing Prospectuses and Statements of Additional
Information and supplements thereto sent to existing shareholders; and
(xiii) such non-recurring or extraordinary expenses as may arise, including
those relating to actions, suits or proceedings to which the Portfolio is a
party and the legal obligation which the Portfolio may have to indemnify
the Trust's Trustees and officers with respect thereto.
6. Interested Persons: It is understood that Trustees, officers, and
shareholders of the Trust are or may be or become interested in the Advisor
or the Sub-Advisor as directors, officers or otherwise and that directors,
officers and stockholders of the Advisor or the Sub-Advisor are or may be
or become similarly interested in the Trust, and that the Advisor or the
Sub-Advisor may be or become interested in the Trust as a shareholder or
otherwise.
7. Services to Other Companies or Accounts: The services of the
Sub-Advisor to the Advisor are not to be deemed to be exclusive, the
Sub-Advisor being free to render services to others and engage in other
activities, provided, however, that such other services and activities do
not, during the term of this Agreement, interfere, in a material manner,
with the Sub-Advisor's ability to meet all of its obligations hereunder.
The Sub-Advisor shall for all purposes be an independent contractor and not
an agent or employee of the Advisor or the Trust.
8. Standard of Care: In the absence of willful misfeasance, bad faith,
gross negligence or reckless disregard of obligations or duties hereunder
on the part of the Sub-Advisor, the Sub-Advisor shall not be subject to
liability to the Advisor, the Trust or to any shareholder of the Portfolio
for any act or omission in the course of, or connected with, rendering
services hereunder or for any losses that may be sustained in the purchase,
holding or sale of any security.
9. Duration and Termination of Agreement; Amendments:
(a) Subject to prior termination as provided in subparagraph (d) of this
paragraph 9, this Agreement shall continue in force until July 31, 1995
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 on 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 __
(TO BE UPDATED)
FUNDS ADVISED BY FMR - TABLE OF AVERAGE NET ASSETS AND EXPENSE RATIOS (A)
RATIO OF RATIO OF NET
ADVISORY FEES ADVISORY FEES
TO AVERAGE TO AVERAGE RATIO OF
AVERAGE NET ASSETS NET ASSETS EXPENSES TO
INVESTMENT FISCAL NET ASSETS PURSUANT TO PAID AVERAGE NET
OBJECTIVE AND FUND YEAR END (A) (MILLIONS) ADVISORY CONTRACT TO FMR
(B) ASSETS (B)
GROWTH AND INCOME
Advisor Equity
Portfolio Income (3) 11/30/92**$ 0.5 0.50%(dagger) 0.50%(dagger)
1.55%(dagger)
Advisor Institutional
Equity Portfolio
Income(3) 11/30/92 147.1 0.50 0.42 0.71
Convertible Securities (3) 11/30/92 254.1 0.54 0.54 0.96
Equity Income II (3) 11/30/92 1,045.7 0.53 0.53 1.01
Variable Insurance
Products:
Equity-Income 12/31/92 408.0 0.53 0.53 0.65
Equity-Income (3) 1/31/93 4,656.2 0.37 0.37 0.67
Real Estate (3) 1/31/93 98.3 0.64 0.64 1.16
Utilities Income (3) 1/31/93 787.5 0.53 0.53 0.87
U.S. Equity Index 2/28/93# 1,482.3 0.28(dagger) -- 0.28(dagger)
Market Index 4/30/93 265.2 0.45 0.44 0.44
Fidelity Fund (3) 6/30/93# 1,398.0 0.42(dagger) 0.42(dagger) 0.66(dagger)
Balanced (3) 7/31/93 2,154.5 0.53 0.53 0.93
Dividend Growth (3) 7/31/93** 9.2 0.62(dagger) -- 2.50(dagger)
Global Balanced (1) 7/31/93** 35.7 0.77(dagger) 0.77(dagger) 2.12(dagger)
Growth & Income 7/31/93 5,195.4 0.53 0.53 0.83
Puritan (3) 7/31/93 6,319.2 0.47 0.47 0.74
Advisor Income &
Growth 10/31/93 870.1 0.53 0.53 1.51
International Growth
& Income (2) 10/31/93 301.5 0.77 0.77 1.52
ASSET ALLOCATION
Variable Insurance
Products II:
Asset Manager (3) 12/31/92 418.2 0.73 0.73 0.91
Index 500 12/31/92** 12.3 0.28(dagger) -- 0.28(dagger)
Asset Manager 9/30/93 4,704.2 0.72 0.72 1.09
Asset Manager: Growth(3) 9/30/93 566.0 0.73 0.63 1.19
Asset Manager: Income(3) 9/30/93 79.1 0.44 -- 0.65
GROWTH
RATIO OF RATIO OF NET
ADVISORY FEES ADVISORY FEES
TO AVERAGE TO AVERAGE RATIO OF
AVERAGE NET ASSETS NET ASSETS EXPENSES TO
INVESTMENT FISCAL NET ASSETS PURSUANT TO PAID AVERAGE NET
OBJECTIVE AND FUND YEAR END (A) (MILLIONS) ADVISORY CONTRACT TO FMR
(B)
ASSETS (B)
Advisor Equity
Portfolio Growth(3) 11/30/92** 8.5 0.74(dagger) 0.74(dagger)
1.64(dagger)
Advisor Institutional
Equity Portfolio
Growth(3) 11/30/92 $ 129.3 0.67% 0.67% 0.98%
Emerging Growth (3) 11/30/92 595.4 0.70 0.70 1.09
Growth Company (3) 11/30/92 1,436.5 0.74 0.74 1.09
Retirement Growth (3) 11/30/92 1,918.0 0.71 0.71 1.02
Congress Street 12/31/92 64.4 0.45 0.45 0.62
Contrafund (3) 12/31/92 1,339.1 0.51 0.51 0.87
Exchange 12/31/92 185.7 0.54 0.54 0.58
Trend (3) 12/31/92 920.0 0.32 0.32 0.56
Variable Insurance
Products:
Growth 12/31/92 520.9 0.63 0.63 0.75
Overseas (2) 12/31/92 157.0 0.78 0.78 1.14
Select Portfolios:
Air Transportation (3) 2/28/93# 11.3 0.64(dagger) 0.48(dagger)
2.48(dagger)
American Gold 2/28/93# 160.2 0.64(dagger) 0.64(dagger) 1.59(dagger)
Automotive (3) 2/28/93# 106.1 0.64(dagger) 0.64(dagger) 1.57(dagger)
Biotechnology (3) 2/28/93# 752.3 0.64(dagger) 0.64(dagger) 1.50(dagger)
Broadcast and Media (3) 2/28/93# 13.9 0.64(dagger) 0.59(dagger)
2.49(dagger)
Brokerage and Investment
Management (3) 2/28/93# 18.0 0.64(dagger) 0.64(dagger) 2.21(dagger)
Chemicals (3) 2/28/93# 35.1 0.64(dagger) 0.64(dagger) 1.89(dagger)
Computers (3) 2/28/93# 38.3 0.64(dagger) 0.64(dagger) 1.81(dagger)
Construction and
Housing (3) 2/28/93# 22.1 0.64(dagger) 0.64(dagger) 2.02(dagger)
Consumer Products (3) 2/28/93# 7.5 0.64(dagger) -- 2.47(dagger)
Defense and
Aerospace (3) 2/28/93# 1.3 0.64(dagger) -- 2.48(dagger)
Developing
Communications (3) 2/28/93# 51.3 0.64(dagger) 0.64(dagger) 1.88(dagger)
Electric Utilities (3) 2/28/93# 30.6 0.64(dagger) 0.64(dagger)
1.70(dagger)
Electronics (3) 2/28/93# 47.1 0.64(dagger) 0.64(dagger) 1.69(dagger)
Energy (3) 2/28/93# 78.7 0.64(dagger) 0.64(dagger) 1.71(dagger)
Energy Service (3) 2/28/93# 52.3 0.64(dagger) 0.64(dagger) 1.76(dagger)
Environmental
Services (3) 2/28/93# 62.5 0.64(dagger) 0.64(dagger) 1.99(dagger)
Financial Services (3) 2/28/93# 119.9 0.64(dagger) 0.64(dagger)
1.54(dagger)
Food and Agriculture (3) 2/28/93# 109.1 0.64(dagger) 0.64(dagger)
1.67(dagger)
Health Care (3) 2/28/93# 782.6 0.64(dagger) 0.64(dagger) 1.46(dagger)
Home Finance (3) 2/28/93# 138.3 0.64(dagger) 0.64(dagger) 1.55(dagger)
Industrial Equipment (3) 2/28/93# 6.1 0.64(dagger) -- 2.49(dagger)
Industrial Materials (3) 2/28/93# $ 25.0 0.64%(dagger) 0.64%(dagger)
2.02%(dagger)
Insurance (3) 2/28/93# 12.3 0.64(dagger) 0.61(dagger) 2.49(dagger)
Leisure (3) 2/28/93# 39.5 0.64(dagger) 0.64(dagger) 1.90(dagger)
Medical Delivery (3) 2/28/93# 126.4 0.64(dagger) 0.64(dagger)
1.77(dagger)
Natural Gas (3) 2/28/94** 9.1 0.64(dagger) -- 2.42(dagger)
Paper and Forest
Products (3) 2/28/93# 17.5 0.64(dagger) 0.64(dagger) 2.21(dagger)
Precious Metals and
Minerals (3) 2/28/93# 127.8 0.64(dagger) 0.64(dagger) 1.73(dagger)
Regional Banks (3) 2/28/93# 193.5 0.64(dagger) 0.64(dagger) 1.49(dagger)
Retailing (3) 2/28/93# 63.1 0.64(dagger) 0.64(dagger) 1.77(dagger)
Software and Computer
Services (3) 2/28/93# 113.6 0.64(dagger) 0.64(dagger) 1.64(dagger)
Technology (3) 2/28/93# 115.2 0.64(dagger) 0.64(dagger) 1.64(dagger)
Telecommunications (3) 2/28/93# 95.0 0.64(dagger) 0.64(dagger)
1.74(dagger)
Transportation (3) 2/28/93# 4.4 0.64(dagger) -- 2.48(dagger)
Utilities (3) 2/28/93# 243.9 0.64(dagger) 0.64(dagger) 1.42(dagger)
Magellan (3) 3/31/93 21,506.4 0.75 0.75 1.00
Small Cap Stock 4/30/94** 461.9 0.67(dagger) 0.65(dagger) 1.40
Fidelity Fifty (3) 6/30/94** 18,106.2 0.69(dagger) 0.00(dagger)
2.49(dagger)
Blue Chip Growth 7/31/93 589.5 0.72 0.72 1.25
Low-Priced Stock (3) 7/31/93 2,048.8 0.76 0.76 1.12
OTC Portfolio 7/31/93 1,202.7 0.74 0.74 1.08
Advisor Strategic
Opportunities (3) 9/30/93 219.2 0.54 0.54 1.57
Destiny I 9/30/93# 2,920.5 0.60(dagger) 0.60(dagger) 0.65(dagger)
Destiny II 9/30/93# 1,100.8 0.71(dagger) 0.71(dagger) 0.84(dagger)
Strategic
Opportunities (3) 9/30/93 19.2 0.54 0.54 0.89
Advisor Global
Resources (3) 10/31/93 14.4 0.77 0.77 2.62
Advisor Growth
Opportunities 10/31/93 1,204.5 0.68 0.68 1.64
Advisor Overseas (2) 10/31/93 65.5 0.77 0.77 2.3
Canada (1) 10/31/93 61.1 0.86 0.86 2.00
Capital Appreciation (3) 10/31/93 1,139.1 0.48 0.48 0.86
Disciplined Equity (3) 10/31/93 622.1 0.70 0.70 1.09
Diversified
International (2) 10/31/93 119.1 0.73 0.73 1.47
Emerging Markets (2) 10/31/93 144.4 0.77 0.77 1.91
Europe (1) 10/31/93 488.3 0.64 0.64 1.25
Japan (1) 10/31/93 98.4 0.77 0.77 1.71
Latin America (2) 10/31/93** $ 114.6 0.77%(dagger) 0.77%(dagger)
1.94%(dagger)
Overseas (2) 10/31/93 1,025.1 0.77 0.77 1.27
Pacific Basin (1) 10/31/93 251.2 0.80 0.80 1.59
Southeast Asia (1) 10/31/93** 139.3 0.77(dagger) 0.71(dagger) 2.00(dagger)
Stock Selector (3) 10/31/93 459.7 0.71 0.69 1.10
Value (3) 10/31/93 1,100.8 0.72 0.71 1.11
Worldwide (2) 10/31/93 148.9 0.78 0.78 1.40
New Millennium 11/30/93** 181.1 0.68(dagger) 0.68(dagger) 1.25(dagger)
CURRENCY PORTFOLIOS
Deutsche Mark
Peformance, L.P. 12/31/92 18.6 0.50 0.50 1.29
Sterling
Performance, L.P. 12/31/92 7.3 0.50 -- 1.50
Yen Performance, L.P. 12/31/92 3.9 0.50 -- 1.50
INCOME
Advisor Institutional
Limited Term Bond 11/30/92 227.6 0.42 0.42 0.57
Advisor Limited
Term Bond 11/30/92** 1.0 0.42(dagger) 0.42(dagger) 0.82(dagger)
Institutional Short-
Intermediate
Government 11/30/92 189.3 0.45 0.45 0.45
Global Bond (2) 12/31/92# 300.5 0.72(dagger) 0.72(dagger) 1.37(dagger)
New Markets Income (2) 12/31/93** 54.1 0.71(dagger) 0.24(dagger)
1.25(dagger)
Short-Term World
Income (2) 12/31/92# 563.2 0.62(dagger) 0.59(dagger) 1.20(dagger)
Spartan Bond Strategist 12/31/93** 11.0 .70(dagger) .70(dagger)
.70(dagger)
Variable Insurance
Products:
High Income 12/31/92 150.7 0.52 0.52 0.67
Variable Insurance
Products II:
Investment Grade
Bond 12/31/92 57.8 0.47 0.47 0.76
Spartan Long-Term
Government Bond 1/31/93 78.3 0.65 0.65 0.65
U.S. Bond Index 2/28/93# 104.8 0.32(dagger) -- 0.32(dagger)
Capital & Income (3) 4/30/93 1,771.1 0.54 0.54 0.91
Intermediate Bond (3) 4/30/93 1,434.0 0.32 0.27 0.61
Investment Grade Bond (3) 4/30/93 1,049.6 0.37 0.37 0.68
Short-Term Bond (3) 4/30/93 1,634.8 0.47 0.47 0.77
Spartan Government
Income 4/30/93 $ 491.8 0.65% 0.65% 0.65%
Spartan High Income 4/30/93 470.8 0.70 0.70 0.70
Spartan Short-Intermediate
Government 4/30/93 23.5 0.65 0.02 0.02
The North Carolina Capital
Management Trust:
Term Portfolio 6/30/93 83.4 0.41 0.41 0.41
Ginnie Mae 7/31/93 953.2 0.47 0.47 0.80
Mortgage Securities 7/31/93 428.9 0.47 0.47 0.76
Spartan Limited Maturity
Government 7/31/93 1,653.7 0.65 0.65 0.65
Spartan Ginnie Mae 8/31/93 766.9 0.65 0.41 0.41
Government Securities 9/30/93** 616.6 0.47(dagger) 0.47(dagger)
0.69(dagger)
Short-Intermediate
Government 9/30/93 167.6 0.47 0.18 0.61
Spartan Investment
Grade Bond 9/30/93 59.1 0.65 0.65 0.65
Spartan Short-Term Bond 9/30/93 547.0 0.65 0.20 0.20
Advisor Government
Investment 10/31/93 40.8 0.46 -- 0.68
Advisor High Yield 10/31/93 299.1 0.51 0.51 1.11
Advisor Short Fixed
Income 10/31/93 359.6 0.47 0.47 0.95
MONEY MARKET
Cash Reserves (4) 11/30/92 10,249.7 0.17 0.17 0.48
State and Local Asset
Management Series:
Government Money
Market (4) 11/30/92 1,046.4 0.43 0.43 0.43
Variable Insurance
Products:
Money Market (4) 12/31/92 295.1 0.17 0.17 0.24
Select-Money Market (4) 2/28/93# 492.5 0.14(dagger) 0.14(dagger)
0.56(dagger)
Institutional Cash:
Domestic Money
Market (4) 3/31/93 768.4 0.20 0.12 0.18
Money Market (4) 3/31/93 5,033.1 0.20 0.15 0.18
U.S. Government (4) 3/31/93 6,305.4 0.20 0.14 0.18
U.S. Treasury (4) 3/31/93 2,683.0 0.20 0.15 0.18
U.S. Treasury II (4) 3/31/93 7,014.6 0.20 0.15 0.18
Spartan Money Market (4) 4/30/93 4,841.1 0.30 0.30 0.30
Spartan U.S. Government
Money Market (4) 4/30/93 $ 1,204.8 0.55% 0.45% 0.45%
The North Carolina
Capital Management Trust:
Cash Portfolio (4) 6/30/93 1,538.3 0.38 0.38 0.39
Daily Money Fund:
Capital Reserves:
Money Market (4) 7/31/93 443.3 0.50 0.31 0.95
U.S. Government
Money Market (4) 7/31/93 269.5 0.50 0.38 0.95
Money Market (4) 7/31/93 1,554.7 0.50 0.50 0.61
U.S. Treasury (4) 7/31/93 2,841.7 0.50 0.50 0.57
U.S. Treasury
Income (4) 7/31/93 1,166.9 0.42 0.20 0.20
Spartan U.S. Treasury
Money Market (4) 7/31/93 2,138.9 0.55 0.42 0.42
Daily Income Trust (4) 8/31/93 2,302.8 0.30 0.30 0.57
Money Market Trust:
Domestic Money
Market (4) 8/31/93 690.3 0.42 0.42 0.42
Retirement Government
Money Market (4) 8/31/93 1,338.8 0.42 0.42 0.42
Retirement Money
Market (4) 8/31/93 1,661.1 0.42 0.42 0.42
U.S. Government (4) 8/31/93 297.5 0.42 0.42 0.42
U.S. Treasury (4) 8/31/93 181.5 0.42 0.42 0.42
U.S. Government
Reserves (4) 9/30/93 1,139.5 0.43 0.43 0.73
TAX-EXEMPT INCOME
Advisor Institutional
Limited Term
Tax-Exempt 11/30/92 63.5 0.42 0.41 0.66
Advisor Limited
Term Tax-Exempt 11/30/92** 1.1 0.42(dagger) 0.40(dagger) 1.04(dagger)
Connecticut Municipal
Money Market (4) 11/30/92 379.8 0.42 0.26 0.43
High Yield Tax-Free 11/30/92 2,036.2 0.42 0.42 0.57
New Jersey Tax-Free
Money Market (4) 11/30/92 360.5 0.42 0.42 0.64
Spartan Connecticut
Municipal:
High Yield 11/30/92 389.8 0.55 0.55 0.55
Money Market (4) 11/30/92 48.7 0.50 0.02 0.02
Spartan Florida Municipal:
Income 11/30/92** $ 118.4 0.55%(dagger) 0.03%(dagger) 0.03%(dagger)
Money Market (4) 11/30/92** 15.8 0.50(dagger) -- --
Spartan New Jersey
Municipal High Yield 11/30/92 324.6 0.55 0.49 0.51
Aggressive Tax-Free 12/31/92 711.1 0.47 0.47 0.64
Insured Tax-Free 12/31/92 335.7 0.42 0.40 0.63
Limited Term
Municipals 12/31/92 827.3 0.47 0.47 0.64
Michigan Tax-Free:
High Yield 12/31/92 419.6 0.42 0.42 0.61
Money Market (4) 12/31/92 170.1 0.42 0.30 0.49
Minnesota Tax-Free 12/31/92 255.1 0.42 0.42 0.67
Municipal Bond 12/31/92 1,178.4 0.37 0.37 0.49
Ohio Tax-Free:
High Yield 12/31/92 359.3 0.42 0.42 0.61
Money Market (4) 12/31/92 257.0 0.42 0.41 0.58
Spartan Pennsylvania
Municipal:
High Yield 12/31/92 218.9 0.55 0.55 0.55
Money Market (4) 12/31/92 249.3 0.50 0.47 0.47
Massachusetts Tax-Free:
High Yield 1/31/93# 1,215.5 0.42(dagger) 0.42(dagger) 0.55(dagger)
Money Market (4) 1/31/93# 592.0 0.42(dagger) 0.42(dagger) 0.64(dagger)
New York Tax-Free:
High Yield 1/31/93# 429.2 0.42(dagger) 0.42(dagger) 0.61(dagger)
Insured 1/31/93# 338.7 0.42(dagger) 0.42(dagger) 0.61(dagger)
Money Market (4) 1/31/93# 536.3 0.42(dagger) 0.42(dagger) 0.62(dagger)
Spartan Massachusetts
Municipal Money
Market (4) 1/31/93# 316.1 0.50(dagger) 0.17(dagger) 0.17(dagger)
Spartan New York
Municipal:
High Yield 1/31/93# 332.3 0.55(dagger) 0.48(dagger) 0.48(dagger)
Money Market (4) 1/31/93# 454.3 0.50(dagger) 0.50(dagger) 0.50(dagger)
California Tax-Free:
High Yield 2/28/93# 543.5 0.42(dagger) 0.42(dagger) 0.60(dagger)
Insured 2/28/93# 213.4 0.42(dagger) 0.42(dagger) 0.63(dagger)
Money Market (4) 2/28/93# 548.7 0.42(dagger) 0.42(dagger) 0.62(dagger)
Spartan California
Municipal:
High Yield 2/28/93# $ 514.4 0.55%(dagger) 0.40%(dagger) 0.40%(dagger)
Money Market (4) 2/28/93# 894.4 0.50(dagger) 0.30(dagger) 0.30(dagger)
Institutional Tax-
Exempt Cash (4) 5/31/93 2,517.7 0.20 0.14 0.18
Daily Money Fund:
Capital Reserves:
Municipal Money
Market (4) 7/31/93 91.7 0.50 0.22 0.95
Spartan Aggressive
Municipal 8/31/93** 6.4 0.60(dagger) 0.60(dagger) 0.60(dagger)
Spartan Intermediate
Municipal 8/31/93** 82.6 0.55(dagger) - -
Spartan Maryland Municipal
Income 8/31/93** 13.4 0.55(dagger) -- --
Spartan Municipal
Income 8/31/93 869.8 0.55 0.47 0.47
Spartan Municipal
Money Market (4) 8/31/93 1,561.2 0.50 0.27 0.27
Spartan Short-
Intermediate
Municipal 8/31/93# 819.9 0.55(dagger) 0.55(dagger) 0.55(dagger)
Advisor High Income
Municipal 10/31/93 316.4 0.42 0.42 0.92
Daily Tax-Exempt
Money (4) 10/31/93 504.9 0.50 0.50 0.61
Spartan New Jersey
Municipal Money
Market (4) 10/31/93 329.1 0.50 0.44 0.44
Tax-Exempt Money
Market Trust (4) 10/31/93 2,789.6 0.27 0.27 0.49
(a) All fund data are as of the fiscal year end noted in the chart or as of
October 31, 1993, if fiscal year end figures are not yet available. 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.
(b) Reflects reductions for any expense reimbursement paid by or due from
FMR pursuant to voluntary or state expense limitations.
(dagger) Annualized
# Year end changed
** Less than a complete fiscal year
(1) 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.
(2) Fidelity Management & Research Company has entered into
sub-advisory agreements with the following affiliates: FMR U.K., FMR Far
East, FIJ (New Markets Income only), FIIA, and FIIAL U.K., with respect to
the fund.
(3) Fidelity Management & Research Company has entered into
sub-advisory agreements with FMR U.K. and FMR Far East, with respect to the
fund.
(4) Fidelity Management & Research Company has entered into a
sub-advisory agreement with FMR Texas Inc., with respect to the fund.
SEC-PXS-794 CUSIP #316389303/FUND #312
CUSIP #316389402/FUND #330
CUSIP #346389204/FUND #027
CUSIP #316389105/FUND #093
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
Hingham, MA 02043-9848
PLEASE DETACH AT PERFORATION BEFORE MAILING.
- --------------------------------------------------------------------------
- --------------------
FIDELITY SECURITIES FUND: FIDELITY BLUE CHIP GROWTH FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur Loring, and ____ or any one or more of them, attorneys,
with full power of substitution, to vote all shares of FIDELITY BLUE CHIP
GROWTH FUND as indicated above whiich 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 15, 1994 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 _____________, 1993
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
CUSIP316389303/FUND#312
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 twelve nominees specified below as FOR all nominees WITHHOLD 1.
Trustees: J. Gary Burkhead, Ralph F. Cox, Phyllis listed (except as vote for
Burke Davis, Richard J. Flynn, Edward C. Johnson 3d, marked to the contrary allnominees.
E. Bradley Jones, Donald J. Kirk, Peter S. Lynch, below).
Gerald C. McDonough, Edward H. Malone, Marvin L.
Mann, 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 as independent FOR AGAINST ABSTAIN 2.
accountants of the trust.To ratify the selection of Coopers &
Lybrand as independent accountants of the fund.
3. To amend the Declaration of Trust to provide dollar-based voting FOR AGAINST ABSTAIN 7.
rights for shareholders of the funds.
4. To adopt Sub-Advisory Agreements with FMR Far East for Fidelity FOR AGAINST ABSTAIN 8.
Blue Chip Growth Fund, Growth & Income Portfolio, and
Fidelity OTC Portfolio.
5. To adopt Sub-Advisory Agreements with FMR U.K. for Fidelity FOR AGAINST ABSTAIN 9.
Blue Chip Growth Fund, Fidelity Growth & Income Portfolio,
and Fidelity OTC Portfolio.
6. To approve an amended management contract for each Fund. FOR AGAINST ABSTAIN 4.
7. To amend the Declaration of Trust regarding shareholder notification FOR AGAINST ABSTAIN 5.
of appointment of Trustees.
8. To amend the Declaration of Trust to provide each fund with the FOR AGAINST ABSTAIN 6.
ability to invest all of its assets in other open-end investment
companies with the same investment objectives and policies.
9. To adopt a new fundamental investment policy permitting each fund FOR AGAINST ABSTAIN 10.
to invest all of its assets in other open-end investment companies with
substantially the same objectives and policies.
10. To amend Fidelity Growth & Income Portfolio's fundamental FOR AGAINST ABSTAIN 3.
investment objective and certain fundamental policies with
non-fundamental investment policies and eliminate certain others.
11. To amend OTC Portfolio's fundamental policy regarding repurchase FOR AGAINST ABSTAIN 11.
agreements.
12. To replace Fidelity Growth & Income Portfolio's and Fidelity FOR AGAINST ABSTAIN 12.
OTC Portfolio's fundamental policy concerning currency contracts.
13. To replace certain of Fidelity OTC Portfolio's fundamental FOR AGAINST ABSTAIN 13.
investment policies with non-fundamental investment policies and
eliminate certain others.
14. To replace Fidelity Growth & Income Portfolio's and Fidelity FOR AGAINST ABSTAIN 14.
OTC Portfolio's fundamental investment limitation concerning
diversification with a fundamental diversification limitation
permitting increased investments in securities of any single issuer.
15. To amend the fundamental investment limitation concerning FOR AGAINST ABSTAIN 15.
borrowing for Fidelity Blue Chip Growth Fund, Fidelity Growth
& Income Portfolio and Fidelity OTC Portfolio.
16. To amend the fundamental investment limitation concerning real FOR AGAINST ABSTAIN 16.
estate for Fidelity Blue Chip Growth Fund, Fidelity Growth &
Income Portfolio, and Fidelity OTC Portfolio.
17. To amend the fundamental investment limitation concerning the FOR AGAINST ABSTAIN 17.
issuance of senior securities for Fidelity Blue Chip Growth Fund,
Fidelity Growth & Income Portfolio, and Fidelity OTC
Portfolio.
18. To eliminate the fundamental investment limitation concerning short FOR AGAINST ABSTAIN 18.
sales of securities for Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio.
19. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 19.
margin purchases for Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio.
20. To amend the fundamental investment limitation concerning lending FOR AGAINST ABSTAIN 20.
for Fidelity Blue Chip Growth Fund, Fidelity Growth & Income
Portfolio, and Fidelity OTC Portfolio.
21. To amend Fidelity Blue Chip Growth Fund's fundamental FOR AGAINST ABSTAIN 13.
investment limitation concerning diversification.
22. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 14.
investment in other investment companies for Fidelity Growth
& Income Portfolio and Fidelity OTC Portfolio.
23. To add a fundamental investment limitation concerning commodities FOR AGAINST ABSTAIN 15.
for Fidelity Growth & Income Portfolio and Fidelity OTC
Portfolio.
24. To amend Fidelity Blue Chip Growth Fund's fundamental FOR AGAINST ABSTAIN 16.
investment limitation concerning commodities.
25. To eliminate Fidelity Growth & Income Portfolio and Fidelity FOR AGAINST ABSTAIN 17.
OTC Portfolio's fundamental investment limitation concerning
investing in oil, gas, and other mineral exploration programs.
26. To amend Fidelity Blue Chip Growth Fund, Fidelity Growth & FOR AGAINST ABSTAIN 18.
Income Portfolio, and Fidelity OTC Portfolio's fundamental
investment limitation concerning the concentration of it's
investments in a single industry.
27. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 19.
restricted and illiquid securities for Fidelity Growth & Income
Portfolio and Fidelity OTC Portfolio.
28. To amend the fundamental investment limitation concerning FOR AGAINST ABSTAIN 20.
underwriting for Blue Chip Growth Fund, Fidelity Growth &
Income Portfolio and Fidelity OTC Portfolio.
29. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 20.
purchasing securities of an issuer in which the Trustees or directors or
officers of the funds or FMR hold more than 5% of the outstanding
securities of such issuer for Fidelity Growth & Income Portfolio
and Fidelity OTC Portfolio.
</TABLE>
SEC-PXC-594
312
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
Hingham, MA 02043-9848
PLEASE DETACH AT PERFORATION BEFORE MAILING.
- --------------------------------------------------------------------------
- --------------------
FIDELITY SECURITIES FUND: FIDELITY GROWTH & INCOME PORTFOLIO
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur Loring, and _____, or any one or more of them,
attorneys, with full power of substitution, to vote all shares of FIDELITY
GROWTH & INCOME PORTFOLIO as indicated above whiich 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 15, 1994 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 _____________, 1993
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
CUSIP316389204FUND#027
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 twelve nominees specified below as FOR all nominees WITHHOLD 1.
Trustees: J. Gary Burkhead, Ralph F. Cox, Phyllis listed (except as vote for
Burke Davis, Richard J. Flynn, Edward C. Johnson 3d, marked to the contrary allnominees.
E. Bradley Jones, Donald J. Kirk, Peter S. Lynch, below).
Gerald C. McDonough, Edward H. Malone, Marvin L.
Mann, 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 as independent FOR AGAINST ABSTAIN 2.
accountants of the trust.To ratify the selection of Coopers &
Lybrand as independent accountants of the fund.
3. To amend the Declaration of Trust to provide dollar-based voting FOR AGAINST ABSTAIN 7.
rights for shareholders of the funds.
4. To adopt Sub-Advisory Agreements with FMR Far East for Fidelity FOR AGAINST ABSTAIN 8.
Blue Chip Growth Fund, Growth & Income Portfolio, and
Fidelity OTC Portfolio.
5. To adopt Sub-Advisory Agreements with FMR U.K. for Fidelity FOR AGAINST ABSTAIN 9.
Blue Chip Growth Fund, Fidelity Growth & Income Portfolio,
and Fidelity OTC Portfolio.
6. To approve an amended management contract for each Fund. FOR AGAINST ABSTAIN 4.
7. To amend the Declaration of Trust regarding shareholder notification FOR AGAINST ABSTAIN 5.
of appointment of Trustees.
8. To amend the Declaration of Trust to provide each fund with the FOR AGAINST ABSTAIN 6.
ability to invest all of its assets in other open-end investment
companies with the same investment objectives and policies.
9. To adopt a new fundamental investment policy permitting each fund FOR AGAINST ABSTAIN 10.
to invest all of its assets in other open-end investment companies with
substantially the same objectives and policies.
10. To amend Fidelity Growth & Income Portfolio's fundamental FOR AGAINST ABSTAIN 3.
investment objective and certain fundamental policies with
non-fundamental investment policies and eliminate certain others.
11. To amend OTC Portfolio's fundamental policy regarding repurchase FOR AGAINST ABSTAIN 11.
agreements.
12. To replace Fidelity Growth & Income Portfolio's and Fidelity FOR AGAINST ABSTAIN 12.
OTC Portfolio's fundamental policy concerning currency contracts.
13. To replace certain of Fidelity OTC Portfolio's fundamental FOR AGAINST ABSTAIN 13.
investment policies with non-fundamental investment policies and
eliminate certain others.
14. To replace Fidelity Growth & Income Portfolio's and Fidelity FOR AGAINST ABSTAIN 14.
OTC Portfolio's fundamental investment limitation concerning
diversification with a fundamental diversification limitation
permitting increased investments in securities of any single issuer.
15. To amend the fundamental investment limitation concerning FOR AGAINST ABSTAIN 15.
borrowing for Fidelity Blue Chip Growth Fund, Fidelity Growth
& Income Portfolio and Fidelity OTC Portfolio.
16. To amend the fundamental investment limitation concerning real FOR AGAINST ABSTAIN 16.
estate for Fidelity Blue Chip Growth Fund, Fidelity Growth &
Income Portfolio, and Fidelity OTC Portfolio.
17. To amend the fundamental investment limitation concerning the FOR AGAINST ABSTAIN 17.
issuance of senior securities for Fidelity Blue Chip Growth Fund,
Fidelity Growth & Income Portfolio, and Fidelity OTC
Portfolio.
18. To eliminate the fundamental investment limitation concerning short FOR AGAINST ABSTAIN 18.
sales of securities for Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio.
19. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 19.
margin purchases for Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio.
20. To amend the fundamental investment limitation concerning lending FOR AGAINST ABSTAIN 20.
for Fidelity Blue Chip Growth Fund, Fidelity Growth & Income
Portfolio, and Fidelity OTC Portfolio.
21. To amend Fidelity Blue Chip Growth Fund's fundamental FOR AGAINST ABSTAIN 13.
investment limitation concerning diversification.
22. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 14.
investment in other investment companies for Fidelity Growth
& Income Portfolio and Fidelity OTC Portfolio.
23. To add a fundamental investment limitation concerning commodities FOR AGAINST ABSTAIN 15.
for Fidelity Growth & Income Portfolio and Fidelity OTC
Portfolio.
24. To amend Fidelity Blue Chip Growth Fund's fundamental FOR AGAINST ABSTAIN 16.
investment limitation concerning commodities.
25. To eliminate Fidelity Growth & Income Portfolio and Fidelity FOR AGAINST ABSTAIN 17.
OTC Portfolio's fundamental investment limitation concerning
investing in oil, gas, and other mineral exploration programs.
26. To amend Fidelity Blue Chip Growth Fund, Fidelity Growth & FOR AGAINST ABSTAIN 18.
Income Portfolio, and Fidelity OTC Portfolio's fundamental
investment limitation concerning the concentration of it's
investments in a single industry.
27. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 19.
restricted and illiquid securities for Fidelity Growth & Income
Portfolio and Fidelity OTC Portfolio.
28. To amend the fundamental investment limitation concerning FOR AGAINST ABSTAIN 20.
underwriting for Blue Chip Growth Fund, Fidelity Growth &
Income Portfolio and Fidelity OTC Portfolio.
29. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 20.
purchasing securities of an issuer in which the Trustees or directors or
officers of the funds or FMR hold more than 5% of the outstanding
securities of such issuer for Fidelity Growth & Income Portfolio
and Fidelity OTC Portfolio.
</TABLE>
SEC-PXC-594
027
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
Hingham, MA 02043-9848
PLEASE DETACH AT PERFORATION BEFORE MAILING.
- --------------------------------------------------------------------------
- --------------------
FIDELITY SECURITIES FUND: FIDELITY DIVIDEND GROWTH FUND
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur Loring, and___, or any one or more of them, attorneys,
with full power of substitution, to vote all shares of FIDELITY DIVIDEND
GROWTH FUND as indicated above whiich 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 15, 1994 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 _____________, 1993
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
CSIP316389402/FUND#330
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 twelve nominees specified below as FOR all nominees WITHHOLD 1.
Trustees: J. Gary Burkhead, Ralph F. Cox, Phyllis listed (except as vote for
Burke Davis, Richard J. Flynn, Edward C. Johnson 3d, marked to the contrary allnominees.
E. Bradley Jones, Donald J. Kirk, Peter S. Lynch, below).
Gerald C. McDonough, Edward H. Malone, Marvin L.
Mann, 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 as independent FOR AGAINST ABSTAIN 2.
accountants of the trust.To ratify the selection of Coopers &
Lybrand as independent accountants of the fund.
3. To amend the Declaration of Trust to provide dollar-based voting FOR AGAINST ABSTAIN 7.
rights for shareholders of the funds.
4. To adopt Sub-Advisory Agreements with FMR Far East for Fidelity FOR AGAINST ABSTAIN 8.
Blue Chip Growth Fund, Growth & Income Portfolio, and
Fidelity OTC Portfolio..
5. To adopt Sub-Advisory Agreements with FMR U.K. for Fidelity FOR AGAINST ABSTAIN 9.
Blue Chip Growth Fund, Fidelity Growth & Income Portfolio,
and Fidelity OTC Portfolio.
6. To approve an amended management contract for each Fund. FOR AGAINST ABSTAIN 4.
7. To amend the Declaration of Trust regarding shareholder notification FOR AGAINST ABSTAIN 5.
of appointment of Trustees.
8. To amend the Declaration of Trust to provide each fund with the FOR AGAINST ABSTAIN 6.
ability to invest all of its assets in other open-end investment
companies with the same investment objectives and policies.
9. To adopt a new fundamental investment policy permitting each fund FOR AGAINST ABSTAIN 10.
to invest all of its assets in other open-end investment companies with
substantially the same objectives and policies.
10. To amend Fidelity Growth & Income Portfolio's fundamental FOR AGAINST ABSTAIN 3.
investment objective and certain fundamental policies with
non-fundamental investment policies and eliminate certain others.
11. To amend OTC Portfolio's fundamental policy regarding repurchase FOR AGAINST ABSTAIN 11.
agreements.
12. To replace Fidelity Growth & Income Portfolio's and Fidelity FOR AGAINST ABSTAIN 12.
OTC Portfolio's fundamental policy concerning currency contracts.
13. To replace certain of Fidelity OTC Portfolio's fundamental FOR AGAINST ABSTAIN 13.
investment policies with non-fundamental investment policies and
eliminate certain others.
14. To replace Fidelity Growth & Income Portfolio's and Fidelity FOR AGAINST ABSTAIN 14.
OTC Portfolio's fundamental investment limitation concerning
diversification with a fundamental diversification limitation
permitting increased investments in securities of any single issuer.
15. To amend the fundamental investment limitation concerning FOR AGAINST ABSTAIN 15.
borrowing for Fidelity Blue Chip Growth Fund, Fidelity Growth
& Income Portfolio and Fidelity OTC Portfolio.
16. To amend the fundamental investment limitation concerning real FOR AGAINST ABSTAIN 16.
estate for Fidelity Blue Chip Growth Fund, Fidelity Growth &
Income Portfolio, and Fidelity OTC Portfolio.
17. To amend the fundamental investment limitation concerning the FOR AGAINST ABSTAIN 17.
issuance of senior securities for Fidelity Blue Chip Growth Fund,
Fidelity Growth & Income Portfolio, and Fidelity OTC
Portfolio.
18. To eliminate the fundamental investment limitation concerning short FOR AGAINST ABSTAIN 18.
sales of securities for Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio.
19. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 19.
margin purchases for Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio.
20. To amend the fundamental investment limitation concerning lending FOR AGAINST ABSTAIN 20.
for Fidelity Blue Chip Growth Fund, Fidelity Growth & Income
Portfolio, and Fidelity OTC Portfolio.
21. To amend Fidelity Blue Chip Growth Fund's fundamental FOR AGAINST ABSTAIN 13.
investment limitation concerning diversification.
22. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 14.
investment in other investment companies for Fidelity Growth
& Income Portfolio and Fidelity OTC Portfolio.
23. To add a fundamental investment limitation concerning commodities FOR AGAINST ABSTAIN 15.
for Fidelity Growth & Income Portfolio and Fidelity OTC
Portfolio.
24. To amend Fidelity Blue Chip Growth Fund's fundamental FOR AGAINST ABSTAIN 16.
investment limitation concerning commodities.
25. To eliminate Fidelity Growth & Income Portfolio and Fidelity FOR AGAINST ABSTAIN 17.
OTC Portfolio's fundamental investment limitation concerning
investing in oil, gas, and other mineral exploration programs.
26. To amend Fidelity Blue Chip Growth Fund, Fidelity Growth & FOR AGAINST ABSTAIN 18.
Income Portfolio, and Fidelity OTC Portfolio's fundamental
investment limitation concerning the concentration of it's
investments in a single industry.
27. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 19.
restricted and illiquid securities for Fidelity Growth & Income
Portfolio and Fidelity OTC Portfolio.
28. To amend the fundamental investment limitation concerning FOR AGAINST ABSTAIN 20.
underwriting for Blue Chip Growth Fund, Fidelity Growth &
Income Portfolio and Fidelity OTC Portfolio.
29. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 20.
purchasing securities of an issuer in which the Trustees or directors or
officers of the funds or FMR hold more than 5% of the outstanding
securities of such issuer for Fidelity Growth & Income Portfolio
and Fidelity OTC Portfolio.
</TABLE>
SEC-PXC-594
330
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
Hingham, MA 02043-9848
PLEASE DETACH AT PERFORATION BEFORE MAILING.
- --------------------------------------------------------------------------
- --------------------
FIDELITY SECURITIES FUND: FIDELITY OTC PORTFOLIO
PROXY SOLICITED BY THE TRUSTEES
The undersigned, revoking previous proxies, hereby appoint(s) Edward C.
Johnson 3d, Arthur Loring, and ___, or any one or more of them, attorneys,
with full power of substitution, to vote all shares of FIDELITY OTC
PORTFOLIO as indicated above whiich 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 15, 1994 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 _____________, 1993
_______________________________________
_______________________________________
Signature(s) (Title(s), if applicable)
PLEASE SIGN, DATE, AND RETURN
PROMPTLY IN ENCLOSED ENVELOPE
CUSIP316389105/FUND#093
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 twelve nominees specified below as FOR all nominees WITHHOLD 1.
Trustees: J. Gary Burkhead, Ralph F. Cox, Phyllis listed (except as vote for
Burke Davis, Richard J. Flynn, Edward C. Johnson 3d, marked to the contrary allnominees.
E. Bradley Jones, Donald J. Kirk, Peter S. Lynch, below).
Gerald C. McDonough, Edward H. Malone, Marvin L.
Mann, 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 as independent FOR AGAINST ABSTAIN 2.
accountants of the trust.To ratify the selection of Coopers &
Lybrand as independent accountants of the fund.
3. To amend the Declaration of Trust to provide dollar-based voting FOR AGAINST ABSTAIN 7.
rights for shareholders of the funds.
4. To adopt Sub-Advisory Agreements with FMR Far East for Fidelity FOR AGAINST ABSTAIN 8.
Blue Chip Growth Fund, Growth & Income Portfolio, and
Fidelity OTC Portfolio.
5. To adopt Sub-Advisory Agreements with FMR U.K. for Fidelity FOR AGAINST ABSTAIN 9.
Blue Chip Growth Fund, Fidelity Growth & Income Portfolio,
and Fidelity OTC Portfolio.
6. To approve an amended management contract for each Fund. FOR AGAINST ABSTAIN 4.
7. To amend the Declaration of Trust regarding shareholder notification FOR AGAINST ABSTAIN 5.
of appointment of Trustees.
8. To amend the Declaration of Trust to provide each fund with the FOR AGAINST ABSTAIN 6.
ability to invest all of its assets in other open-end investment
companies with the same investment objectives and policies.
9. To adopt a new fundamental investment policy permitting each fund FOR AGAINST ABSTAIN 10.
to invest all of its assets in other open-end investment companies with
substantially the same objectives and policies.
10. To amend Fidelity Growth & Income Portfolio's fundamental FOR AGAINST ABSTAIN 3.
investment objective and certain fundamental policies with
non-fundamental investment policies and eliminate certain others.
11. To amend OTC Portfolio's fundamental policy regarding repurchase FOR AGAINST ABSTAIN 11.
agreements.
12. To replace Fidelity Growth & Income Portfolio's and Fidelity FOR AGAINST ABSTAIN 12.
OTC Portfolio's fundamental policy concerning currency contracts.
13. To replace certain of Fidelity OTC Portfolio's fundamental FOR AGAINST ABSTAIN 13.
investment policies with non-fundamental investment policies and
eliminate certain others.
14. To replace Fidelity Growth & Income Portfolio's and Fidelity FOR AGAINST ABSTAIN 14.
OTC Portfolio's fundamental investment limitation concerning
diversification with a fundamental diversification limitation
permitting increased investments in securities of any single issuer.
15. To amend the fundamental investment limitation concerning FOR AGAINST ABSTAIN 15.
borrowing for Fidelity Blue Chip Growth Fund, Fidelity Growth
& Income Portfolio and Fidelity OTC Portfolio.
16. To amend the fundamental investment limitation concerning real FOR AGAINST ABSTAIN 16.
estate for Fidelity Blue Chip Growth Fund, Fidelity Growth &
Income Portfolio, and Fidelity OTC Portfolio.
17. To amend the fundamental investment limitation concerning the FOR AGAINST ABSTAIN 17.
issuance of senior securities for Fidelity Blue Chip Growth Fund,
Fidelity Growth & Income Portfolio, and Fidelity OTC
Portfolio.
18. To eliminate the fundamental investment limitation concerning short FOR AGAINST ABSTAIN 18.
sales of securities for Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio.
19. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 19.
margin purchases for Fidelity Blue Chip Growth Fund, Fidelity
Growth & Income Portfolio, and Fidelity OTC Portfolio.
20. To amend the fundamental investment limitation concerning lending FOR AGAINST ABSTAIN 20.
for Fidelity Blue Chip Growth Fund, Fidelity Growth & Income
Portfolio, and Fidelity OTC Portfolio.
21. To amend Fidelity Blue Chip Growth Fund's fundamental FOR AGAINST ABSTAIN 13.
investment limitation concerning diversification.
22. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 14.
investment in other investment companies for Fidelity Growth
& Income Portfolio and Fidelity OTC Portfolio.
23. To add a fundamental investment limitation concerning commodities FOR AGAINST ABSTAIN 15.
for Fidelity Growth & Income Portfolio and Fidelity OTC
Portfolio.
24. To amend Fidelity Blue Chip Growth Fund's fundamental FOR AGAINST ABSTAIN 16.
investment limitation concerning commodities.
25. To eliminate Fidelity Growth & Income Portfolio and Fidelity FOR AGAINST ABSTAIN 17.
OTC Portfolio's fundamental investment limitation concerning
investing in oil, gas, and other mineral exploration programs.
26. To amend Fidelity Blue Chip Growth Fund, Fidelity Growth & FOR AGAINST ABSTAIN 18.
Income Portfolio, and Fidelity OTC Portfolio's fundamental
investment limitation concerning the concentration of it's
investments in a single industry.
27. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 19.
restricted and illiquid securities for Fidelity Growth & Income
Portfolio and Fidelity OTC Portfolio.
28. To amend the fundamental investment limitation concerning FOR AGAINST ABSTAIN 20.
underwriting for Blue Chip Growth Fund, Fidelity Growth &
Income Portfolio and Fidelity OTC Portfolio.
29. To eliminate the fundamental investment limitation concerning FOR AGAINST ABSTAIN 20.
purchasing securities of an issuer in which the Trustees or directors or
officers of the funds or FMR hold more than 5% of the outstanding
securities of such issuer for Fidelity Growth & Income Portfolio
and Fidelity OTC Portfolio.
</TABLE>
SEC-PXC-594
093
