-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, TMxd0HFSACa2Vr2jOFyMd570L1mLoF58KQWStanRzK8b9NMNnimlzHVX5IrmKka6 2nAYLomnB09L5zVj3OQSPg== 0000035348-98-000003.txt : 19980323 0000035348-98-000003.hdr.sgml : 19980323 ACCESSION NUMBER: 0000035348-98-000003 CONFORMED SUBMISSION TYPE: 485BPOS PUBLIC DOCUMENT COUNT: 19 FILED AS OF DATE: 19980319 EFFECTIVENESS DATE: 19980325 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: FIDELITY HASTINGS STREET TRUST CENTRAL INDEX KEY: 0000035348 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 046026953 STATE OF INCORPORATION: MA FISCAL YEAR END: 0630 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: SEC FILE NUMBER: 002-11517 FILM NUMBER: 98568861 FILING VALUES: FORM TYPE: 485BPOS SEC ACT: SEC FILE NUMBER: 811-00215 FILM NUMBER: 98568862 BUSINESS ADDRESS: STREET 1: 82 DEVONSHIRE ST CITY: BOSTON STATE: MA ZIP: 02109 BUSINESS PHONE: 6173300814 MAIL ADDRESS: STREET 1: 82 DEVONSHIRE STREET STREET 2: MAIL ZONE ZH-1 CITY: BOSTON STATE: MA ZIP: 02109 FORMER COMPANY: FORMER CONFORMED NAME: FIDELITY FUND DATE OF NAME CHANGE: 19920703 FORMER COMPANY: FORMER CONFORMED NAME: FIDELITY FUND INC DATE OF NAME CHANGE: 19851205 485BPOS 1 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-1A REGISTRATION STATEMENT (No. 2-11517) UNDER THE SECURITIES ACT OF 1933 [X] Pre-Effective Amendment No. [ ] Post-Effective Amendment No. 102 [X] and REGISTRATION STATEMENT (No. 811-215) UNDER THE INVESTMENT COMPANY ACT OF 1940 [X] Amendment No. 102 [X] Fidelity Hastings Street Trust (Exact Name of Registrant as Specified in Charter) 82 Devonshire St., Boston, Massachusetts 02109 (Address Of Principal Executive Offices) (Zip Code) Registrant's Telephone Number: 617-563-7000 Eric D. Roiter, Secretary 82 Devonshire Street Boston, Massachusetts 02109 (Name and Address of Agent for Service) It is proposed that this filing will become effective ( ) immediately upon filing pursuant to paragraph (b). (X) on March 25, 1998 pursuant to paragraph (b). ( ) 60 days after filing pursuant to paragraph (a)(1). ( ) on ( ) pursuant to paragraph (a)(1) of Rule 485. ( ) 75 days after filing pursuant to paragraph (a)(2). ( ) on ( ) pursuant to paragraph (a)(2) of Rule 485. If appropriate, check the following box: ( ) this post-effective amendment designates a new effective date for a previously filed post-effective amendment. CROSS REFERENCE SHEET FORM N-1A ITEM NUMBER PROSPECTUS SECTION
1 .............................. Cover Page 2 a .............................. Expenses b, c .............................. Contents; The Fund at a Glance; Who May Want to Invest 3 a .............................. * b .............................. * c, d .............................. * 4 a i............................. Charter ii........................... The Fund at a Glance; Investment Principles and Risks b .............................. Investment Principles and Risks c .............................. Who May Want to Invest; Investment Principles and Risks 5 a .............................. Charter b i............................. Cover Page: The Fund at a Glance; Charter; Doing Business with Fidelity ii........................... Charter iii.......................... Expenses; Breakdown of Expenses c .............................. Charter d .............................. Charter; Breakdown of Expenses e .............................. Cover Page; Charter f .............................. Expenses g i............................. Charter ii............................ * 5A .............................. * 6 a i............................. Charter ii........................... How to Buy Shares; How to Sell Shares; Transaction Details; Exchange Restrictions iii.......................... Charter b ............................. * c .............................. Transaction Details; Exchange Restrictions d .............................. * e .............................. Doing Business with Fidelity; How to Buy Shares; How to Sell Shares; Investor Services f, g .............................. Dividends, Capital Gains, and Taxes h .............................. * 7 a .............................. Cover Page; Charter b .............................. Expenses; How to Buy Shares; Transaction Details c .............................. * d .............................. How to Buy Shares e .............................. * f .............................. Breakdown of Expenses 8 .............................. How to Sell Shares; Investor Services; Transaction Details; Exchange Restrictions 9 .............................. *
* Not Applicable CROSS REFERENCE SHEET (CONTINUED) FORM N-1A ITEM NUMBER STATEMENT OF ADDITIONAL INFORMATION SECTION
10, 11 ............................ Cover Page 12 ............................ Description of the Trust 13 a - c ............................ Investment Policies and Limitations d ............................ Portfolio Transactions 14 a - c ............................ Trustees and Officers 15 a, b ............................ * c ............................ Trustees and Officers 16 a i........................... FMR, Portfolio Transactions ii.......................... Trustees and Officers iii......................... Management Contract b ............................ Management Contract c, d ............................ Contracts with FMR Affiliates e ............................ * f ............................ Distribution and Service Plan g ............................ * h ............................ Description of the Trust i ............................ Contracts with FMR Affiliates 17 a ............................ Portfolio Transactions b ............................ * c ............................ Portfolio Transactions d, e ............................ * 18 a ............................ Description of the Trust b ............................ * 19 a ............................ Additional Purchase and Redemption Information b ............................ Additional Purchase and Redemption Information Valuation c ............................ * 20 ............................ Distributions and Taxes 21 a, b ............................ Contracts with FMR Affiliates c ............................ * 22 a ............................ * b ............................ * 23 ............................ *
* Not Applicable FIDELITY INCOME & GROWTH FUND Please read this prospectus before investing, and keep it on file for future reference. It contains important information, including how the fund invests and the services available to shareholders. To learn more about the fund and its investments, you can obtain a copy of the fund's Statement of Additional Information (SAI) dated March 25, 1998. The SAI has been filed with the Securities and Exchange Commission (SEC) and is available along with other related materials on the SEC's Internet Web site (http://www.sec.gov). The SAI is incorporated herein by reference (legally forms a part of the prospectus). For a free copy, call Fidelity at 1-800-544-8888. Mutual fund shares are not deposits or obligations of, or guaranteed by, any depository institution. Shares are not insured by the FDIC, Federal Reserve Board, or any other agency, and are subject to investment risks, including possible loss of principal amount invested. (fund number ____, trading symbol ____) Income & Growth seeks high total return through a combination of current income and capital appreciation by investing mainly in equity securities. LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. IAG -PRO-0398 PROSPECTUS MARCH 25, 1998(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON, MA 02109 CONTENTS KEY FACTS THE FUND AT A GLANCE WHO MAY WANT TO INVEST EXPENSES The fund's yearly operating expenses. PERFORMANCE THE FUND IN DETAIL CHARTER How the fund is organized. INVESTMENT PRINCIPLES AND RISKS The fund's overall approach to investing. BREAKDOWN OF EXPENSES How operating costs are calculated and what they include. YOUR ACCOUNT DOING BUSINESS WITH FIDELITY TYPES OF ACCOUNTS Different ways to set up your account, including tax-ad vantaged retirement plans. HOW TO BUY SHARES Opening an account and making additional investments. HOW TO SELL SHARES Taking money out and closing your account. INVESTOR SERVICES Services to help you manage your account. SHAREHOLDER AND DIVIDENDS, CAPITAL GAINS, ACCOUNT POLICIES AND TAXES TRANSACTION DETAILS Share price calculations and the timing of purchases and redemptions. EXCHANGE RESTRICTIONS KEY FACTS THE FUND AT A GLANCE GOAL: High total return through a combination of current income and capital appreciation. As with any mutual fund, there is no assurance that the fund will achieve its goal. STRATEGY: Invests mainly in equity securities of companies that pay current dividends and offer potential growth of earnings. MANAGEMENT: Fidelity Management & Research Company (FMR) is the management arm of Fidelity Investments, which was established in 1946 and is now America's largest mutual fund manager. Foreign affiliates of FMR may help choose investments for the fund. WHO MAY WANT TO INVEST The fund may be appropriate for investors who are willing to ride out stock market fluctuations in pursuit of potentially high long-term returns. The fund is designed for those who seek a combination of growth and income from equity and some bond investments. The value of the fund's investments and the income they generate will vary from day to day, and generally reflect market conditions, interest rates, and other company, political, or economic news both here and abroad. In the short-term, stock prices can fluctuate dramatically in response to these factors. Over time, however, stocks have shown greater growth potential than other types of securities. The prices of bonds generally move in the opposite direction from interest rates. Investments in foreign securities may involve risks in addition to those of U.S. investments, including increased political and economic risk, as well as exposure to currency fluctuations. When you sell your shares, they may be worth more or less than what you paid for them. By itself, the fund does not constitute a balanced investment plan. THE SPECTRUM OF FIDELITY FUNDS BROAD CATEGORIES OF FIDELITY FUNDS ARE PRESENTED HERE IN ORDER OF ASCENDING RISK. GENERALLY, INVESTORS SEEKING TO MAXIMIZE RETURN MUST ASSUME GREATER RISK. FIDELITY INCOME & GROWTH FUND IS IN THE GROWTH AND INCOME CATEGORY. (SOLID BULLET) MONEY MARKET SEEKS INCOME AND STABILITY BY INVESTING IN HIGH-QUALITY, SHORT-TERM INVESTMENTS. (SOLID BULLET) INCOME SEEKS INCOME BY INVESTING IN BONDS. (RIGHT ARROW) GROWTH AND INCOME SEEKS LONG-TERM GROWTH AND INCOME BY INVESTING IN STOCKS AND BONDS. (SOLID BULLET) GROWTH SEEKS LONG-TERM GROWTH BY INVESTING MAINLY IN STOCKS. (CHECKMARK) EXPENSES SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy or sell shares of a fund. In addition, you may be charged an annual account maintenance fee if your account balance falls below $2,500. See "Transaction Details," page , for an explanation of how and when these charges apply. Sales charge on purchases None and reinvested distributions Deferred sales charge on redemptions None Annual account maintenance fee $12.00 (for accounts under $2,500) ANNUAL FUND OPERATING EXPENSES are paid out of the fund's assets. The fund pays a management fee to FMR. It also incurs other expenses for services such as maintaining shareholder records and furnishing shareholder statements and financial reports. The fund's expenses are factored into its share price or dividends and are not charged directly to shareholder accounts (see "Breakdown of Expenses" page ). The following figures are based on estimated expenses of the fund and are calculated as a percentage of average net assets of the fund. Management fee 0.49% 12b-1 fee None Other expenses 0.93% Total fund operating expenses 1.42% EXAMPLES: Let's say, hypothetically, that the fund's annual return is 5% and that your shareholder transaction expenses and the fund's annual operating expenses are exactly as just described. For every $1,000 you invested, here's how much you would pay in total expenses if you close your account after the number of years indicated: 1 year $14 3 years $45 These examples illustrate the effect of expenses, but are not meant to suggest actual or expected expenses or returns, all of which may vary. UNDERSTANDING EXPENSES OPERATING A MUTUAL FUND INVOLVES A VARIETY OF EXPENSES FOR PORTFOLIO MANAGEMENT, SHAREHOLDER STATEMENTS, TAX REPORTING, AND OTHER SERVICES. THESE EXPENSES ARE PAID FROM THE FUND'S ASSETS, AND THEIR EFFECT IS ALREADY FACTORED INTO ANY QUOTED SHARE PRICE OR RETURN. ALSO, AS AN INVESTOR, YOU MAY PAY CERTAIN EXPENSES DIRECTLY. (CHECKMARK) PERFORMANCE This section would normally show how the fund has performed over time. Because the fund was new when this prospectus was printed, its performance is not included. Twice a year, you will receive a report detailing the fund's recent strategies, performance, and holdings. For current performance or a free annual report, call 1-800-544-8888. TOTAL RETURN is the change in value of an investment over a given period, assuming reinvestment of any dividends and capital gains. A CUMULATIVE TOTAL RETURN reflects actual performance over a stated period of time. An AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that, if achieved annually, would have produced the same cumulative total return if performance had been constant over the entire period. Average annual total returns smooth out variations in performance; they are not the same as actual year-by-year results. Average annual total returns covering periods of less than one year assume that performance will remain constant for the rest of the year. UNDERSTANDING PERFORMANCE Because this fund invests in stocks, its performance is related to that of the overall stock market. Historically, stock market performance has been characterized by volatility in the short run and growth in the long run. (checkmark) YIELD refers to the income generated by an investment in the fund over a given period of time, expressed as an annual percentage rate. Yields are calculated according to a standard that is required for all stock and bond funds. Because this differs from other accounting methods, the quoted yield may not equal the income actually paid to shareholders. STANDARD & POOR'S 500 INDEX (S&P 500(registered trademark)) is a widely recognized, unmanaged index of common stocks. Unlike the fund's returns, the total returns of the comparative index do not include the effect of any brokerage commissions, transaction fees, or other costs of investing. Other illustrations of fund performance may show moving averages over specified periods. TOTAL RETURNS AND YIELDS ARE BASED ON PAST RESULTS AND ARE NOT AN INDICATION OF FUTURE PERFORMANCE. THE FUND IN DETAIL CHARTER INCOME & GROWTH IS A MUTUAL FUND: an investment that pools shareholders' money and invests it toward a specified goal. The fund is a diversified fund of Fidelity Hastings Street Trust, an open-end management investment company organized as a Massachusetts business trust on December 31, 1984. THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for protecting the interests of shareholders. The trustees are experienced executives who meet periodically throughout the year to oversee the fund's activities, review contractual arrangements with companies that provide services to the fund, and review the fund's performance. The trustees serve as trustees for other Fidelity funds. The majority of trustees are not otherwise affiliated with Fidelity. THE FUND MAY HOLD SPECIAL SHAREHOLDER MEETINGS AND MAIL PROXY MATERIALS. These meetings may be called to elect or remove trustees, change fundamental policies, approve a management contract, or for other purposes. Shareholders not attending these meetings are encouraged to vote by proxy. Fidelity will mail proxy materials in advance, including a voting card and information about the proposals to be voted on. The number of votes you are entitled to is based upon the dollar value of your investment. FMR AND ITS AFFILIATES The fund is managed by FMR, which chooses the fund's investments and handles its business affairs. Fidelity Management & Research (U.K.) Inc. (FMR U.K.), in London, England, and Fidelity Management & Research (Far East) Inc. (FMR Far East), in Tokyo, Japan, assist FMR with foreign investments. Fidelity investment personnel may invest in securities for their own accounts pursuant to a code of ethics that establishes procedures for personal investing and restricts certain transactions. Fidelity Distributors Corporation (FDC) distributes and markets Fidelity's funds and services. Fidelity Service Company, Inc. (FSC) performs transfer agent servicing functions for the fund. FMR Corp. is the ultimate parent company of FMR, FMR U.K., and FMR Far East. Members of the Edward C. Johnson 3d family are the predominant owners of a class of shares of common stock representing approximately 49% of the voting power of FMR Corp. Under the Investment Company Act of 1940 (the 1940 Act), control of a company is presumed where one individual or group of individuals owns more than 25% of the voting stock of that company; therefore, the Johnson family may be deemed under the 1940 Act to form a controlling group with respect to FMR Corp. FMR may use its broker-dealer affiliates and other firms that sell fund shares to carry out the fund's transactions, provided that the fund receives brokerage services and commission rates comparable to those of other broker-dealers. INVESTMENT PRINCIPLES AND RISKS The fund seeks high total return through a combination of current income and capital appreciation by investing primarily in equity securities. The fund expects to focus its investments on equity securities that pay current dividends and show potential for capital appreciation. However, the fund may buy debt securities as well as equity securities that are not currently paying dividends, but offer prospects for future income or capital appreciation. The value of the fund's domestic and foreign investments varies in response to many factors. Stock values fluctuate in response to the activities of individual companies and general market and economic conditions. Bond values fluctuate based on changes in interest rates and in the credit quality of the issuer. Investments in foreign securities may involve risks in addition to those of U.S. investments, including increased political and economic risk, as well as exposure to currency fluctuations. FMR may use various investment techniques to hedge a portion of the fund's risks, but there is no guarantee that these strategies will work as FMR intends. Also, as a mutual fund, the fund seeks to spread investment risk by diversifying its holdings among many companies and industries. Of course, when you sell your shares of the fund, they may be worth more or less than what you paid for them. FMR normally invests the fund's assets according to its investment strategy. The fund also reserves the right to invest without limitation in preferred stocks and investment-grade debt instruments for temporary, defensive purposes. SECURITIES AND INVESTMENT PRACTICES The following pages contain more detailed information about types of instruments in which the fund may invest, strategies FMR may employ in pursuit of the fund's investment objective, and a summary of related risks. Any restrictions listed supplement those discussed earlier in this section. A complete listing of the fund's limitations and more detailed information about the fund's investments are contained in the fund's SAI. Policies and limitations are considered at the time of purchase; the sale of instruments is not required in the event of a subsequent change in circumstances. FMR may not buy all of these instruments or use all of these techniques unless it believes that they are consistent with the fund's investment objective and policies and that doing so will help the fund achieve its goal. Fund holdings and recent investment strategies are detailed in the fund's financial reports, which are sent to shareholders twice a year. For a free SAI or financial report, call 1-800-544-8888. EQUITY SECURITIES may include common stocks, preferred stocks, convertible securities, and warrants. Common stocks, the most familiar type, represent an equity (ownership) interest in a corporation. Although equity securities have a history of long-term growth in value, their prices fluctuate based on changes in a company's financial condition and on overall market and economic conditions. Smaller companies are especially sensitive to these factors. RESTRICTIONS: With respect to 75% of total assets, the fund may not purchase more than 10% of the outstanding voting securities of a single issuer. This limitation does not apply to securities of other investment companies. DEBT SECURITIES. Bonds and other debt instruments are used by issuers to borrow money from investors. The issuer generally pays the investor a fixed, variable, or floating rate of interest, and must repay the amount borrowed at maturity. Some debt securities, such as zero coupon bonds, do not pay current interest, but are sold at a discount from their face values. DEBT RATINGS MOODY'S INVESTORS SERVICE STANDARD & POOR'S Rating Rating INVESTMENT GRADE Highest quality Aaa AAA High quality Aa AA Upper-medium grade A A Medium grade Baa BBB LOWER QUALITY Moderately speculative Ba BB Speculative B B Highly speculative Caa CCC Poor quality Ca CC Lowest quality, no interest C C In default, in arrears -- D REFER TO THE FUND'S SAI FOR A MORE COMPLETE DISCUSSION OF THESE RATINGS. THE FUND DOES NOT NECESSARILY RELY ON THE RATINGS OF MOODY'S OR S&P TO DETERMINE COMPLIANCE WITH ITS DEBT QUALITY POLICY. Debt securities have varying levels of sensitivity to changes in interest rates and varying degrees of credit quality. In general, bond prices rise when interest rates fall, and fall when interest rates rise. Longer-term bonds and zero coupon bonds are generally more sensitive to interest rate changes. Lower-quality debt securities (sometimes called "junk bonds") are considered to have speculative characteristics, and involve greater risk of default or price changes due to changes in the issuer's creditworthiness, or they may already be in default. The market prices of these securities may fluctuate more than higher-quality securities and may decline significantly in periods of general or regional economic difficulty. RESTRICTIONS: Purchase of a debt security is consistent with the fund's debt quality policy if it is rated at or above the stated level by Moody's Investors Service (Moody's)or rated in the equivalent categories by S&P, or is unrated but judged to be of equivalent quality by FMR. The fund currently intends to limit its investments in lower than Baa-quality debt securities to less than 35% of its assets. EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies, and securities issued by U.S. entities with substantial foreign operations may involve additional risks and consider ations. These include risks relating to political, economic, or regulatory conditions in foreign countries; fluctuations in foreign currencies; withholding or other taxes; trading, settlement, custodial, and other operational risks; and the potentially less stringent investor protection and disclosure standards of foreign markets. Additionally, governmental issuers of foreign debt securities may be unwilling to pay interest and repay principal when due and may require that the conditions for payment be renegotiated. All of these factors can make foreign investments, especially those in e merging markets, more volatile and potentially less liquid than U.S. investments. ASSET-BACKED SECURITIES include interests in pools of debt securities, commercial or consumer loans, or other receivables. The value of these securities depends on many factors, including changes in interest rates, the availability of information concerning the pool and its structure, the credit quality of the underlying assets, the market's perception of the servicer of the pool, and any credit enhancement provided. In addition, these securities may be subject to prepayment risk. MORTGAGE SECURITIES include interests in pools of commercial or residential mortgages, and may include complex instruments such as collateralized mortgage obligations and stripped mortgage-backed securities. Mortgage securities may be issued by agencies or instrumentalities of the U.S. Government or by private entities. The price of a mortgage security may be significantly affected by changes in interest rates. Some mortgage securities may have a structure that makes their reaction to interest rates and other factors difficult to predict, making their price highly volatile. Also, mortgage securities, especially stripped mortgage-backed securities, are subject to prepayment risk. Securities subject to prepayment risk generally offer less potential for gains during a declining interest rate environment, and similar or greater potential for loss in a rising interest rate environment. REPURCHASE AGREEMENTS. In a repurchase agreement, the fund buys a security at one price and simultaneously agrees to sell it back at a higher price. Delays or losses could result if the other party to the agreement defaults or becomes insolvent. ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to increase or decrease its exposure to changing security prices, interest rates, currency exchange rates, commodity prices, or other factors that affect security values. These techniques may involve derivative transactions such as buying and selling options and futures contracts, entering into currency exchange contracts or swap agreements, purchasing indexed securities, and selling securities short. FMR can use these practices to adjust the risk and return characteristics of the fund's portfolio of investments. If FMR judges market conditions incorrectly or employs a strategy that does not correlate well with the fund's investments, these techniques could result in a loss, regardless of whether the intent was to reduce risk or increase return. These techniques may increase the volatility of the fund and may involve a small investment of cash relative to the magnitude of the risk assumed. In addition, these techniques could result in a loss if the counterparty to the transaction does not perform as promised. DIRECT DEBT. Loans and other direct debt instruments are interests in amounts owed to another party by a company, government, or other borrower. They have additional risks beyond conventional debt securities because they may entail less legal protection for the fund, or there may be a requirement that the fund supply additional cash to a borrower on demand. ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined by FMR, under the supervision of the Board of Trustees, to be illiquid, which means that they may be difficult to sell promptly at an acceptable price. The sale of some illiquid securities, and some other securities, may be subject to legal restrictions. Difficulty in selling securities may result in a loss or may be costly to the fund. RESTRICTIONS: The fund may not purchase a security if, as a result, more than 10% of its assets would be invested in illiquid securities. OTHER INSTRUMENTS may include securities of closed-end investment companies and real estate-related instruments. CASH MANAGEMENT. The fund may invest in money market securities, in repurchase agreements, and in a money market fund available only to funds and accounts managed by FMR or its affiliates, whose goal is to seek a high level of current income while maintaining a stable $1.00 share price. A major change in interest rates or a default on the money market fund's investments could cause its share price to change. DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the risks of investing. This may include limiting the amount of money invested in any one issuer or, on a broader scale, in any one industry. RESTRICTIONS: With respect to 75% of its total assets, the fund may not purchase a security if, as a result, more than 5% would be invested in the securities of any issuer. This limitation does not apply to U.S. Government securities or to securities of other investment companies. The fund may not invest more than 25% of its total assets in any one industry. This limitation does not apply to U.S. Government securities. BORROWING. The fund may borrow from banks or from other funds advised by FMR, or through reverse repurchase agreements. If the fund borrows money, its share price may be subject to greater fluctuation until the borrowing is paid off. If the fund makes additional investments while borrowings are outstanding, this may be considered a form of leverage. RESTRICTIONS: The fund may borrow only for temporary or emergency purposes, but not in an amount exceeding 331/3% of its total assets. LENDING securities to broker-dealers and institutions, including Fidelity Brokerage Services, Inc. (FBSI), an affiliate of FMR, is a means of earning income. This practice could result in a loss or a delay in recovering the fund's securities. The fund may also lend money to other funds advised by FMR. RESTRICTIONS: Loans, in the aggregate, may not exceed 331/3% of the fund's total assets. FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS Some of the policies and restrictions discussed on the preceding pages are fundamental, that is, subject to change only by shareholder approval. The following paragraphs restate all those that are fundamental. All policies stated throughout this prospectus, other than those identified in the following paragraphs, can be changed without shareholder approval. The fund seeks high total return through a combination of current income and capital appreciation. With respect to 75% of its total assets, the fund may not purchase a security if, as a result, more than 5% would be invested in the securities of any issuer and may not purchase more than 10% of the outstanding voting securities of a single issuer. These limitations do not apply to U.S. Government securities or to securities of other investment companies. The fund may not invest more than 25% of its total assets in any one industry. This limitation does not apply to U.S. Government securities. The fund may borrow only for temporary or emergency purposes, but not in an amount exceeding 331/3% of its total assets. Loans, in the aggregate, may not exceed 331/3% of the fund's total assets. BREAKDOWN OF EXPENSES Like all mutual funds, the fund pays fees related to its daily operations. Expenses paid out of the fund's assets are reflected in its share price or dividends; they are neither billed directly to shareholders nor deducted from shareholder accounts. The fund pays a MANAGEMENT FEE to FMR for managing its investments and business affairs. FMR in turn pays fees to affiliates who provide assistance with these services. The fund also pays OTHER EXPENSES, which are explained on page . FMR may, from time to time, agree to reimburse the fund for management fees and other expenses above a specified limit. FMR retains the ability to be repaid by the fund if expenses fall below the specified limit prior to the end of the fiscal year. Reimbursement arrangements, which may be terminated at any time without notice, can decrease the fund's expenses and boost its performance. MANAGEMENT FEE The management fee is calculated and paid to FMR every month. The fee is calculated by adding a group fee rate to an individual fund fee rate, multiplying the result by the fund's monthly average net assets and dividing by twelve . UNDERSTANDING THE MANAGEMENT FEE The management fee FMR receives is designed to be responsive to changes in FMR's total assets under management. Building this variable into the fee calculation assures shareholders that they will pay a lower rate as FMR's assets under management increase. (checkmark) The group fee rate is based on the average net assets of all the mutual funds advised by FMR. This rate cannot rise above 0.52%, and it drops as total assets under management increase. For January 199 8 , the group fee rate was 0.2937 %. The individual fund fee rate is 0.20%. The total management fee for the fiscal year ending June 30, 1998 is estimated to be 0.49% of the fund's average net assets. FMR HAS SUB-ADVISORY AGREEMENTS with FMR U.K. and FMR Far East. These sub-advisers provide FMR with investment research and advice on issuers based outside the United States. Under the sub-advisory agreements, FMR pays FMR U.K. and FMR Far East fees equal to 110% and 105%, respectively, of the costs of providing these services. The sub-advisers may also provide investment management services. In return, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its management fee rate with respect to the fund's investments that the sub-adviser manages on a discretionary basis. OTHER EXPENSES While the management fee is a significant component of the fund's annual operating costs, the fund has other expenses as well. The fund contracts with FSC to perform transfer agency, dividend disbursing, shareholder servicing, and accounting functions. These services include processing shareholder transactions, valuing the fund's investments, handling securities loans, and calculating the fund's share price and dividends. The fund also pays other expenses, such as legal, audit, and custodian fees; in some instances, proxy solicitation costs; and the compensation of trustees who are not affiliated with Fidelity. A broker-dealer may use a portion of the commissions paid by the fund to reduce the fund's custodian or transfer agent fees. The fund has adopted a DISTRIBUTION AND SERVICE PLAN. This plan recognizes that FMR may use its management fee revenues, as well as its past profits or its resources from any other source, to pay FDC for expenses incurred in connection with the distribution of fund shares. FMR directly, or through FDC, may make payments to third parties, such as banks or broker-dealers, that engage in the sale of, or provide shareholder support services for, the fund's shares. Currently, the Board of Trustees has authorized such payments. The fund's annualized portfolio turnover rate is expected to exceed 100% in the first fiscal period. This rate varies from year to year. High turnover rates increase transaction costs and may increase taxable capital gains. FMR considers these effects when evaluating the anticipated benefits of short-term investing. YOUR ACCOUNT DOING BUSINESS WITH FIDELITY Fidelity Investments was established in 1946 to manage one of America's first mutual funds. Today, Fidelity is the largest mutual fund company in the country, and is known as an innovative provider of high-quality financial services to individuals and institutions. In addition to its mutual fund business, the company operates one of America's leading discount brokerage firms, FBSI. Fidelity is also a leader in providing tax- advantag ed retirement plans for individuals investing on their own or through their employer. Fidelity is committed to providing investors with practical information to make investment decisions. Based in Boston, Fidelity provides customers with complete service 24 hours a day, 365 days a year, through a network of telephone service centers around the country. To reach Fidelity for general information, call these numbers: (small solid bullet) For mutual funds, 1-800-544-8888 (small solid bullet) For brokerage, 1-800-544-7272 If you would prefer to speak with a representative in person, Fidelity has over 80 walk-in Investor Centers across the country. TYPES OF ACCOUNTS You may set up an account directly in the fund or, if you own or intend to purchase individual securities as part of your total investment portfolio, you may consider investing in the fund through a brokerage account. You may purchase or sell shares of the fund through an investment professional, including a broker, who may charge you a transaction fee for this service. If you invest through FBSI, another financial institution, or an investment professional, read their program materials for any special provisions, additional service features or fees that may apply to your investment in the fund. Certain features of the fund, such as the minimum initial or subsequent investment amounts, may be modified. The different ways to set up (register) your account with Fidelity are listed in the table that follows. The account guidelines that follow may not apply to certain retirement accounts. If you are investing through a retirement account or if your employer offers the fund through a retirement program, you may be subject to additional fees. For more information, please refer to your program materials, contact your employer, or call your retirement benefits number or Fidelity directly, as appropriate. FIDELITY FACTS Fidelity offers the broadest selection of mutual funds in the world. (solid bullet) Number of Fidelity mutual funds: over 223 (solid bullet) Assets in Fidelity mutual funds: over $ 537 billion (solid bullet) Number of shareholder accounts: over 35 million (solid bullet) Number of investment analysts and portfolio managers: over 265 (checkmark) WAYS TO SET UP YOUR ACCOUNT INDIVIDUAL OR JOINT TENANT FOR YOUR GENERAL INVESTMENT NEEDS Individual accounts are owned by one person. Joint accounts can have two or more owners (tenants). RETIREMENT FOR TAX-ADVANTAGED RETIREMENT SAVINGS Retirement plans provide individuals with tax-advantaged ways to save for retirement, either with tax-deductible contributions or tax-free growth. Retirement accounts require special applications and typically have lower minimums. (solid bullet) TRADITIONAL INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) allow individuals under age 70 with compensation to contribute up to $2,000 per tax year. Married couples can contribute up to $4,000 per tax year, provided no more than $2,000 is contributed on behalf of either spouse. (These limits are aggregate for Traditional and Roth IRAs.) Contributions may be tax deductible, subject to certain income limits. (solid bullet) ROTH IRAS allow individuals to make non-deductible contributions of up to $2,000 per tax year. Married couples can contribute up to $4,000 per tax year, provided no more than $2,000 is contributed on behalf of either spouse. (These limits are aggregate for Traditional and Roth IRAs.) Eligibility is subject to certain income limits. Qualified distributions are tax-free. (solid bullet) ROTH CONVERSION IRAS allow individuals with assets held in a Traditional IRA or Rollover IRA to convert those assets to a Roth Conversion IRA. Eligibility is subject to certain income limits. Qualified distributions are tax-free. (solid bullet) ROLLOVER IRAS help retain special tax advantages for certain eligible rollover distributions from employer-sponsored retirement plans. (solid bullet) PROFIT SHARING OR MONEY PURCHASE PENSION PLANS (KEOGHS) allow self-employed individuals or small business owners to make tax-deductible contributions for themselves and any eligible employees. (solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS) provide small business owners or those with self-employment (and their eligible employees) with many of the same advantages as a Keogh, but with fewer administrative requirements. (solid bullet) SALARY REDUCTION SEP-IRAS (SARSEPS) allow employees of businesses with 25 or fewer employees to contribute a percentage of their wages on a tax-deferred basis. These plans must have been established by the employer prior to January 1, 1997. (solid bullet) SIMPLE IRAS provide small business owners and those with self-employment income (and their eligible employees) with many of the advantages of a 401(k) plan, but with fewer administrative requirements. (solid bullet) 403(B) CUSTODIAL ACCOUNTS are available to employees of 501(c)(3) tax-exempt institutions, including schools, hospitals, and other charitable organizations. (solid bullet) 401(K) PROGRAMS allow employees of organizations of all sizes to contribute a percentage of their wages on a tax-deferred basis. These accounts need to be established by the trustee of the plan. (solid bullet) DEFERRED COMPENSATION PLANS (457 PLANS) are available to employees of most state and local governments and their agencies and to employees of tax-exempt institutions. GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA) TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS These custodial accounts provide a way to give money to a child and obtain tax benefits. An individual can give up to $10,000 a year per child without paying federal gift tax. Depending on state laws, you can set up a custodial account under the Uniform Gifts to Minors Act (UGMA) or the Uniform Transfers to Minors Act (UTMA). TRUST FOR MONEY BEING INVESTED BY A TRUST The trust must be established before an account can be opened. BUSINESS OR ORGANIZATION FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER GROUPS Requires a special application. HOW TO BUY SHARES THE PRICE TO BUY ONE SHARE of the fund is the fund's net asset value per share (NAV). The fund's shares are sold without a sales charge. Your shares will be purchased at the next NAV calculated after your investment is received in proper form. The fund's NAV is normally calculated each business day at 4:00 p.m. Eastern time. The fund reserves the right to reject any specific purchase order, including certain purchases by exchange. See "Exchange Restrictions" on page . Purchase orders may be refused if, in FMR's opinion, they would disrupt management of a fund. IF YOU ARE NEW TO FIDELITY, complete and sign an account application and mail it along with your check. You may also open your account in person or by wire as described on page . If there is no application accompanying this prospectus, call 1-800-544-8888. IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can: (small solid bullet) Mail in an application with a check, or (small solid bullet) Open your account by exchanging from another Fidelity fund. IF YOU ARE INVESTING THROUGH A TAX-ADVANTAGED RETIREMENT PLAN, such as an IRA, for the first time, you will need a special application. Retirement investing also involves its own investment procedures. Call 1-800-544-8888 for more information and a retirement application. If you buy shares by check or Fidelity Money Line(registered trademark), and then sell those shares by any method other than by exchange to another Fidelity fund, the payment may be delayed for up to seven business days to ensure that your previous investment has cleared. MINIMUM INVESTMENTS TO OPEN AN ACCOUNT $2,500 For certain Fidelity retirement accounts(double dagger) $500 TO ADD TO AN ACCOUNT $250 For certain Fidelity retirement accounts(double dagger) $250 Through regular investment plans* $100 MINIMUM BALANCE $2,000 For certain Fidelity retirement accounts(double dagger) $500 (double dagger) THESE LOWER MINIMUMS APPLY TO FIDELITY TRADITIONAL IRA, ROTH IRA, ROTH CONVERSION IRA, ROLLOVER IRA, SEP-IRA, AND KEOGH ACCOUNTS. *FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE REFER TO "INVESTOR SERVICES," PAGE . These minimums may vary for investments through Fidelity Portfolio Advisory Services. There is no minimum account balance or initial or subsequent investment minimum for certain retirement accounts funded through salary deduction, or accounts opened with the proceeds of distributions from Fidelity retirement accounts. Refer to the program materials for details.
TO OPEN TO ADD TO AN AN ACCOUNT ACCOUNT PHONE 1-800-544-7777 (PHONE_GRAPHIC) (SMALL SOLID BULLET) EXCHANGE FROM (SMALL SOLID BULLET) EXCHANGE ANOTHER FIDELITY FROM ANOTHER FUND ACCOUNT FIDELITY FUND WITH THE SAME ACCOUNT WITH REGISTRATION, THE SAME INCLUDING NAME, REGISTRATION, ADDRESS, AND INCLUDING TAXPAYER ID NAME, NUMBER. ADDRESS, AND TAXPAYER ID NUMBER. (SMALL SOLID BULLET) USE FIDELITY MONEY LINE TO TRANSFER FROM YOUR BANK ACCOUNT. CALL BEFORE YOUR FIRST USE TO VERIFY THAT THIS SERVICE IS IN PLACE ON YOUR ACCOUNT. MAXIMUM MONEY LINE: UP TO $100,000. MAIL (MAIL_GRAPHIC) (SMALL SOLID BULLET) COMPLETE AND (SMALL SOLID BULLET) MAKE YOUR SIGN THE CHECK PAYABLE APPLICATION. TO "FIDELITY MAKE YOUR INCOME & CHECK PAYABLE GROWTH TO "FIDELITY FUND." INCOME & INDICATE YOUR GROWTH FUND." FUND ACCOUNT MAIL TO THE NUMBER ON ADDRESS YOUR CHECK INDICATED ON AND MAIL TO THE APPLICATION. THE ADDRESS PRINTED ON YOUR ACCOUNT STATEMENT. (SMALL SOLID BULLET) EXCHANGE BY MAIL: CALL 1-800-544-66 66 FOR INSTRUCTIONS. IN PERSON (HAND_GRAPHIC) (SMALL SOLID BULLET) BRING YOUR (SMALL SOLID BULLET) BRING YOUR APPLICATION AND CHECK TO A CHECK FIDELITY TO A FIDELITY INVESTOR INVESTOR CENTER. CENTER. CALL CALL 1-800-544-9 1-800-544-97 797 FOR THE 97 FOR THE CENTER NEAREST CENTER NEAREST YOU. YOU. WIRE (WIRE_GRAPHIC) (SMALL SOLID BULLET) CALL (SMALL SOLID BULLET) NOT AVAILABLE 1-800-544-77 FOR RETIREMENT 77 TO SET UP ACCOUNTS. YOUR ACCOUNT (SMALL SOLID BULLET) WIRE TO: AND TO ARRANGE BANKERS TRUST A WIRE COMPANY, TRANSACTION. BANK ROUTING NOT AVAILABLE #02100103 FOR RETIREMENT 3, ACCOUNTS. ACCOUNT (SMALL SOLID BULLET) WIRE WITHIN 24 #00163053. HOURS TO: SPECIFY THE BANKERS TRUST COMPLETE COMPANY, NAME OF THE BANK ROUTING FUND AND #021001033, INCLUDE YOUR ACCOUNT ACCOUNT #00163053. NUMBER AND SPECIFY THE YOUR NAME. COMPLETE NAME OF THE FUND AND INCLUDE YOUR NEW ACCOUNT NUMBER AND YOUR NAME. AUTOMATICALLY (AUTOMATIC_GRAPHIC) (SMALL SOLID BULLET) NOT AVAILABLE. (SMALL SOLID BULLET) USE FIDELITY AUTOMATIC ACCOUNT BUILDER. SIGN UP FOR THIS SERVICE WHEN OPENING YOUR ACCOUNT, OR CALL 1-800-544- 6666 TO ADD IT.
(TDD_GRAPHIC) TDD - SERVICE FOR THE DEAF AND HEARING IMPAIRED: 1-800-544-0118
HOW TO SELL SHARES You can arrange to take money out of your fund account at any time by selling (redeeming) some or all of your shares. THE PRICE TO SELL ONE SHARE of the fund is the fund's NAV. Your shares will be sold at the next NAV calculated after your order is received in proper form. The fund's NAV is normally calculated each business day at 4:00 p.m. Eastern time. TO SELL SHARES IN A NON-RETIREMENT ACCOUNT, you may use any of the methods described on these two pages. TO SELL SHARES IN A FIDELITY RETIREMENT ACCOUNT, your request must be made in writing, except for exchanges to other Fidelity funds, which can be requested by phone or in writing. Call 1-800-544-6666 for a retirement distribution form. IF YOU ARE SELLING SOME BUT NOT ALL OF YOUR SHARES, leave at least $2,000 worth of shares in the account to keep it open ($500 for retirement accounts). TO SELL SHARES BY BANK WIRE OR FIDELITY MONEY LINE, you will need to sign up for these services in advance. CERTAIN REQUESTS MUST INCLUDE A SIGNATURE GUARANTEE. It is designed to protect you and Fidelity from fraud. Your request must be made in writing and include a signature guarantee if any of the following situations apply: (small solid bullet) You wish to redeem more than $100,000 worth of shares, (small solid bullet) Your account registration has changed within the last 30 days, (small solid bullet) The check is being mailed to a different address than the one on your account (record address), (small solid bullet) The check is being made payable to someone other than the account owner, or (small solid bullet) The redemption proceeds are being transferred to a Fidelity account with a different registration. You should be able to obtain a signature guarantee from a bank, broker (including Fidelity Investor Centers), dealer, credit union (if authorized under state law), securities exchange or association, clearing agency, or savings association. A notary public cannot provide a signature guarantee. SELLING SHARES IN WRITING Write a "letter of instruction" with: (small solid bullet) Your name, (small solid bullet) The fund's name, (small solid bullet) Your fund account number, (small solid bullet) The dollar amount or number of shares to be redeemed, and (small solid bullet) Any other applicable requirements listed in the table that follows. Unless otherwise instructed, Fidelity will send a check to the record address. Deliver your letter to a Fidelity Investor Center, or mail it to: Fidelity Investments P.O. Box 660602 Dallas, TX 75266-0602 ACCOUNT TYPE SPECIAL REQUIREMENTS
PHONE 1-800-544-7777 (PHONE_GRAPHIC) ALL ACCOUNT TYPES (SMALL SOLID BULLET) MAXIMUM EXCEPT RETIREMENT CHECK REQUEST: $100,000. ALL ACCOUNT TYPES (SMALL SOLID BULLET) FOR MONEY LINE TRANSFERS TO YOUR BANK ACCOUNT; MINIMUM: $10; MAXIMUM: UP TO $100,000. (SMALL SOLID BULLET) YOU MAY EXCHANGE TO OTHER FIDELITY FUNDS IF BOTH ACCOUNTS ARE REGISTERED WITH THE SAME NAME(S), ADDRESS, AND TAXPAYER ID NUMBER. MAIL OR IN PERSON (MAIL_GRAPHIC)(HAND_GRAPHIC) INDIVIDUAL, JOINT (SMALL SOLID BULLET) THE LETTER OF TENANT, INSTRUCTION SOLE PROPRIETORSHI MUST BE SIGNED P, UGMA, UTMA BY ALL PERSONS RETIREMENT REQUIRED TO ACCOUNT SIGN FOR TRANSACTIONS, EXACTLY AS THEIR TRUST NAMES APPEAR ON THE ACCOUNT. (SMALL SOLID BULLET) THE ACCOUNT BUSINESS OR OWNER SHOULD ORGANIZATION COMPLETE A RETIREMENT DISTRIBUTION FORM. CALL 1-800-544-66 EXECUTOR, 66 TO REQUEST ADMINISTRATOR, ONE. CONSERVATOR, (SMALL SOLID BULLET) THE TRUSTEE GUARDIAN MUST SIGN THE LETTER INDICATING CAPACITY AS TRUSTEE. IF THE TRUSTEE'S NAME IS NOT IN THE ACCOUNT REGISTRATION, PROVIDE A COPY OF THE TRUST DOCUMENT CERTIFIED WITHIN THE LAST 60 DAYS. (SMALL SOLID BULLET) AT LEAST ONE PERSON AUTHORIZED BY CORPORATE RESOLUTION TO ACT ON THE ACCOUNT MUST SIGN THE LETTER. (SMALL SOLID BULLET) INCLUDE A CORPORATE RESOLUTION WITH CORPORATE SEAL OR A SIGNATURE GUARANTEE. (SMALL SOLID BULLET) CALL 1-800-544-66 66 FOR INSTRUCTIONS. WIRE (WIRE_GRAPHIC) ALL ACCOUNT TYPES (SMALL SOLID BULLET) YOU MUST SIGN EXCEPT RETIREMENT UP FOR THE WIRE FEATURE BEFORE USING IT. TO VERIFY THAT IT IS IN PLACE, CALL 1-800-544-66 66. MINIMUM WIRE: $5,000. (SMALL SOLID BULLET) YOUR WIRE REDEMPTION REQUEST MUST BE RECEIVED IN PROPER FORM BY FIDELITY BEFORE 4:00 P.M. EASTERN TIME FOR MONEY TO BE WIRED ON THE NEXT BUSINESS DAY.
(TDD_GRAPHIC) TDD - SERVICE FOR THE DEAF AND HEARING IMPAIRED: 1-800-544-0118
INVESTOR SERVICES Fidelity provides a variety of services to help you manage your account. INFORMATION SERVICES FIDELITY'S TELEPHONE REPRESENTATIVES are available 24 hours a day, 365 days a year. Whenever you call, you can speak with someone equipped to provide the information or service you need. 24-HOUR SERVICE ACCOUNT ASSISTANCE 1-800-544-6666 ACCOUNT TRANSACTIONS 1-800-544-7777 PRODUCT INFORMATION 1-800-544-8888 RETIREMENT ACCOUNT ASSISTANCE 1-800-544-4774 TOUCHTONE XPRESSSM 1-800-544-5555 AUTOMATED SERVICE (checkmark) STATEMENTS AND REPORTS that Fidelity sends to you include the following: (small solid bullet) Confirmation statements (after every transaction, except reinvestments, that affects your account balance or your account registration) (small solid bullet) Account statements (quarterly) (small solid bullet) Financial reports (every six months) To reduce expenses, only one copy of most financial reports and prospectuses will be mailed to your household, even if you have more than one account in the fund. Call 1-800-544-6666 if you need copies of financial reports, prospectuses, or historical account information. TRANSACTION SERVICES EXCHANGE PRIVILEGE. You may sell your fund shares and buy shares of other Fidelity funds by telephone or in writing. Note that exchanges out of the fund are limited to four per calendar year, and that they may have tax consequences for you. For details on policies and restrictions governing exchanges, including circumstances under which a shareholder's exchange privilege may be suspended or revoked, see page . SYSTEMATIC WITHDRAWAL PLANS let you set up periodic redemptions from your account. FIDELITY MONEY LINE(registered trademark) enables you to transfer money by phone between your bank account and your fund account. Most transfers are complete within three business days of your call. REGULAR INVESTMENT PLANS One easy way to pursue your financial goals is to invest money regularly. Fidelity offers convenient services that let you transfer money into your fund account, or between fund accounts, automatically. While regular investment plans do not guarantee a profit and will not protect you against loss in a declining market, they can be an excellent way to invest for retirement, a home, educational expenses, and other long-term financial goals. Certain restrictions apply for retirement accounts. Call 1-800-544-6666 for more information. REGULAR INVESTMENT PLANS FIDELITY AUTOMATIC ACCOUNT BUILDERSM TO MOVE MONEY FROM YOUR BANK ACCOUNT TO A FIDELITY FUND
MINIMUM FREQUENCY SETTING UP OR CHANGING $100 MONTHLY OR QUARTERLY (SMALL SOLID BULLET) FOR A NEW ACCOUNT, COMPLETE THE APPROPRIATE SECTION ON THE FUND APPLICATION. (SMALL SOLID BULLET) FOR EXISTING ACCOUNTS, CALL 1-800-544-6666 FOR AN APPLICATION. (SMALL SOLID BULLET) TO CHANGE THE AMOUNT OR FREQUENCY OF YOUR INVESTMENT, CALL 1-800-544-6666 AT LEAST THREE BUSINESS DAYS PRIOR TO YOUR NEXT SCHEDULED INVESTMENT DATE.
DIRECT DEPOSIT TO SEND ALL OR A PORTION OF YOUR PAYCHECK OR GOVERNMENT CHECK TO A FIDELITY FUNDA
MINIMUM FREQUENCY SETTING UP OR CHANGING $100 EVERY PAY PERIOD (SMALL SOLID BULLET) CHECK THE APPROPRIATE BOX ON THE FUND APPLICATION, OR CALL 1-800-544-6666 FOR AN AUTHORIZATION FORM. (SMALL SOLID BULLET) CHANGES REQUIRE A NEW AUTHORIZATION FORM.
FIDELITY AUTOMATIC EXCHANGE SERVICE TO MOVE MONEY FROM A FIDELITY MONEY MARKET FUND TO ANOTHER FIDELITY FUND
MINIMUM FREQUENCY SETTING UP OR CHANGING $100 Monthly, bimonthly, quarterly, or (small solid bullet) To establish, call annually 1-800-544-6666 after both accounts are opened. (small solid bullet) To change the amount or frequency of your investment, call 1-800-544-6666.
A BECAUSE ITS SHARE PRICE FLUCTUATES, THE FUND MAY NOT BE AN APPROPRIATE CHOICE FOR DIRECT DEPOSIT OF YOUR ENTIRE CHECK. SHAREHOLDER AND ACCOUNT POLICIES DIVIDENDS, CAPITAL GAINS, AND TAXES The fund distributes substantially all of its net income and capital gains to shareholders each year. Normally dividends are distributed in March, June, September, and December. Capital gains are distributed in August and December. DISTRIBUTION OPTIONS When you open an account, specify on your application how you want to receive your distributions. If the option you prefer is not listed on the application, call 1-800-544-6666 for instructions. The fund offers four options: 1. REINVESTMENT OPTION. Your dividend and capital gain distributions will be automatically reinvested in additional shares of the fund. If you do not indicate a choice on your application, you will be assigned this option. 2. INCOME-EARNED OPTION. Your capital gain distributions will be automatically reinvested, but you will be sent a check for each dividend distribution. 3. CASH OPTION. You will be sent a check for your dividend and capital gain distributions. 4. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividend and capital gain distributions will be automatically invested in another identically registered Fidelity fund. When the fund deducts a distribution from its NAV, the reinvestment price is the fund's NAV at the close of business that day. Cash distribution checks will be mailed within seven days. TAXES As with any investment, you should consider how your investment in the fund will be taxed. If your account is not a tax-advantaged retirement account, you should be aware of these tax implications. TAXES ON DISTRIBUTIONS. Distributions are subject to federal income tax, and may also be subject to state or local taxes. If you live outside the United States, your distributions could also be taxed by the country in which you reside. Your distributions are taxable when they are paid, whether you take them in cash or reinvest them. However, distributions declared in December and paid in January are taxable as if they were paid on December 31. UNDERSTANDING DISTRIBUTIONS As a fund shareholder, you are entitled to your share of the fund's net income and gains on its investments. The fund passes its earnings along to its investors as DISTRIBUTIONS. The fund earns dividends from stocks and interest from bond, money market, and other investments. These are passed along as DIVIDEND DISTRIBUTIONS. The fund realizes capital gains whenever it sells securities for a higher price than it paid for them. These are passed along as CAPITAL GAIN DISTRIBUTIONS. (checkmark) For federal tax purposes, the fund's income and short-term capital gains are distributed as dividends and taxed as ordinary income; capital gain distributions are taxed as long-term capital gains. Every January, Fidelity will send you and the IRS a statement showing the tax characterization of distributions paid to you in the previous year. TAXES ON TRANSACTIONS. Your redemptions - including exchanges to other Fidelity funds - are subject to capital gains tax. A capital gain or loss is the difference between the cost of your shares and the price you receive when you sell them. Whenever you sell shares of the fund, Fidelity will send you a confirmation statement showing how many shares you sold and at what price. You will also receive a consolidated transaction statement every January. However, it is up to you or your tax preparer to determine whether this sale resulted in a capital gain and, if so, the amount of tax to be paid. Be sure to keep your regular account statements; the information they contain will be essential in calculating the amount of your capital gains. "BUYING A DIVIDEND." If you buy shares when the fund has realized but not yet distributed income or capital gains, you will pay the full price for the shares and then receive a portion of the price back in the form of a taxable distribution. EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on the fund and its investments, and these taxes generally will reduce the fund's distributions. However, if you meet certain holding period requirements with respect to your fund shares, an offsetting tax credit may be available to you. If you do not meet such holding period requirements, you may still be entitled to a deduction for certain foreign taxes. In either case, your tax statement will show more taxable income or capital gains than were actually distributed by the fund, but will also show the amount of the available offsetting credit or deduction. There are tax requirements that all funds must follow in order to avoid federal taxation. In its effort to adhere to these requirements, the fund may have to limit its investment activity in some types of instruments. TRANSACTION DETAILS THE FUND IS OPEN FOR BUSINESS each day the New York Stock Exchange (NYSE) is open. FSC normally calculates the fund's NAV as of the close of business of the NYSE, normally 4:00 p.m. Eastern time. THE FUND'S NAV is the value of a single share. The NAV is computed by adding the value of the fund's investments, cash, and other assets, subtracting its liabilities, and then dividing the result by the number of shares outstanding. The fund's assets are valued primarily on the basis of market quotations. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued on the basis of amortized cost. This method minimizes the effect of changes in a security's market value. Foreign securities are valued on the basis of quotations from the primary market in which they are traded, and are translated from the local currency into U.S. dollars using current exchange rates. In addition, if quotations are not readily available, or if the values have been materially affected by events occurring after the closing of a foreign market, assets may be valued by another method that the Board of Trustees believes accurately reflects fair value. WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify that your social security or taxpayer identification number is correct and that you are not subject to 31% backup withholding for failing to report income to the IRS. If you violate IRS regulations, the IRS can require the fund to withhold 31% of your taxable distributions and redemptions. YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE OR ELECTRONICALLY. Fidelity will not be responsible for any losses resulting from unauthorized transactions if it follows reasonable security procedures designed to verify the identity of the investor. Fidelity will request personalized security codes or other information, and may also record calls. For transactions conducted through the Internet, Fidelity recommends the use of an Internet browser with 128-bit encryption. You should verify the accuracy of your confirmation statements immediately after you receive them. If you do not want the ability to redeem and exchange by telephone, call Fidelity for instructions. IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during periods of unusual market activity), consider placing your order by mail or by visiting a Fidelity Investor Center. THE FUND RESERVES THE RIGHT to suspend the offering of shares for a period of time. WHEN YOU PLACE AN ORDER TO BUY SHARES, your shares will be purchased at the next NAV calculated after your investment is received in proper form. Note the following: (small solid bullet) All of your purchases must be made in U.S. dollars and checks must be drawn on U.S. banks. (small solid bullet) Fidelity does not accept cash. (small solid bullet) When making a purchase with more than one check, each check must have a value of at least $50. (small solid bullet) The fund reserves the right to limit the number of checks processed at one time. (small solid bullet) If your check does not clear, your purchase will be canceled and you could be liable for any losses or fees the fund or its transfer agent has incurred. TO AVOID THE COLLECTION PERIOD associated with check and Money Line purchases, consider buying shares by bank wire, U.S. Postal money order, U.S. Treasury check, Federal Reserve check, or direct deposit instead. CERTAIN FINANCIAL INSTITUTIONS that have entered into sales agreements with FDC may enter confirmed purchase orders on behalf of customers by phone, with payment to follow no later than the time when the fund is priced on the following business day. If payment is not received by that time, the financial institution could be held liable for resulting fees or losses. WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the next NAV calculated after your order is received in proper form. Note the following: (small solid bullet) Normally, redemption proceeds will be mailed to you on the next business day, but if making immediate payment could adversely affect the fund, it may take up to seven days to pay you. (small solid bullet) Fidelity Money Line redemptions generally will be credited to your bank account on the second or third business day after your phone call. (small solid bullet) The fund may hold payment on redemptions until it is reasonably satisfied that investments made by check or Fidelity Money Line have been collected, which can take up to seven business days. (small solid bullet) Redemptions may be suspended or payment dates postponed when the NYSE is closed (other than weekends or holidays), when trading on the NYSE is restricted, or as permitted by the SEC. FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of $12.00 from accounts with a value of less than $2,500, subject to an annual maximum charge of $24.00 per shareholder. It is expected that accounts will be valued on the second Friday in November of each year. Accounts opened after September 30 will not be subject to the fee for that year. The fee, which is payable to the transfer agent, is designed to offset in part the relatively higher costs of servicing smaller accounts. This fee will not be deducted from Fidelity brokerage accounts, retirement accounts (except non-prototype retirement accounts), accounts using regular investment plans, or if total assets with Fidelity exceed $30,000. Eligibility for the $30,000 waiver is determined by aggregating Fidelity accounts maintained by FSC or FBSI which are registered under the same social security number or which list the same social security number for the custodian of a Uniform Gifts/Transfers to Minors Act account. IF YOUR ACCOUNT BALANCE FALLS BELOW $2,000, you will be given 30 days' notice to reestablish the minimum balance. If you do not increase your balance, Fidelity reserves the right to close your account and send the proceeds to you. Your shares will be redeemed at the NAV on the day your account is closed. FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing historical account documents, that are beyond the normal scope of its services. FDC may, at its own expense, provide promotional incentives to qualified recipients who support the sale of shares of the fund without reimbursement from the fund. Qualified recipients are securities dealers who have sold fund shares or others, including banks and other financial institutions, under special arrangements in connection with FDC's sales activities. In some instances, these incentives may be offered only to certain institutions whose representatives provide services in connection with the sale or expected sale of significant amounts of shares. EXCHANGE RESTRICTIONS As a shareholder, you have the privilege of exchanging shares of the fund for shares of other Fidelity funds. However, you should note the following: (small solid bullet) The fund you are exchanging into must be available for sale in your state. (small solid bullet) You may only exchange between accounts that are registered in the same name, address, and taxpayer identification number. (small solid bullet) Before exchanging into a fund, read its prospectus. (small solid bullet) If you exchange into a fund with a sales charge, you pay the percentage-point difference between that fund's sales charge and any sales charge you have previously paid in connection with the shares you are exchanging. For example, if you had already paid a sales charge of 2% on your shares and you exchange them into a fund with a 3% sales charge, you would pay an additional 1% sales charge. (small solid bullet) Exchanges may have tax consequences for you. (small solid bullet) Because excessive trading can hurt fund performance and shareholders, the fund reserves the right to temporarily or permanently terminate the exchange privilege of any investor who makes more than four exchanges out of the fund per calendar year. Accounts under common ownership or control, including accounts with the same taxpayer identification number, will be counted together for purposes of the four exchange limit. (small solid bullet) The exchange limit may be modified for accounts in certain institutional retirement plans to conform to plan exchange limits and Department of Labor regulations. See your plan materials for further information. (small solid bullet) The fund reserves the right to refuse exchange purchases by any person or group if, in FMR's judgment, the fund would be unable to invest the money effectively in accordance with its investment objective and policies, or would otherwise potentially be adversely affected. (small solid bullet) Your exchanges may be restricted or refused if the fund receives or anticipates simultaneous orders affecting significant portions of the fund's assets. In particular, a pattern of exchanges that coincides with a "market timing" strategy may be disruptive to the fund. Although the fund will attempt to give you prior notice whenever it is reasonably able to do so, it may impose these restrictions at any time. The fund reserves the right to terminate or modify the exchange privilege in the future. OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose administrative fees of up to 1.00% and trading fees of up to 3.00 % of the amount exchanged. Check each fund's prospectus for details. This prospectus is printed on recycled paper using soy-based inks. FIDELITY INCOME & GROWTH FUND A FUND OF FIDELITY HASTINGS STREET TRUST STATEMENT OF ADDITIONAL INFORMATION MARCH 25, 1998 This Statement of Additional Information (SAI) is not a prospectus but should be read in conjunction with the fund's current Prospectus (dated March 25, 1998). Please retain this document for future reference. To obtain a free additional copy of the Prospectus, please call Fidelity at 1-800-544-8888. TABLE OF CONTENTS PAGE Investment Policies and Limitations Portfolio Transactions Valuation Performance Additional Purchase, Exchange and Redemption Information Distributions and Taxes FMR Trustees and Officers Management Contract Distribution and Service Plan Contracts with FMR Affiliates Description of the Trust Appendix INVESTMENT ADVISER Fidelity Management & Research Company (FMR) INVESTMENT SUB-ADVISERS Fidelity Management & Research (U.K.) Inc. (FMR U.K.) Fidelity Management & Research (Far East) Inc. (FMR Far East) DISTRIBUTOR Fidelity Distributors Corporation (FDC) TRANSFER AGENT Fidelity Service Company, Inc. (FSC) IAG -ptb-0398 INVESTMENT POLICIES AND LIMITATIONS The following policies and limitations supplement those set forth in the Prospectus. Unless otherwise noted, whenever an investment policy or limitation states a maximum percentage of the fund's assets that may be invested in any security or other asset, or sets forth a policy regarding quality standards, such standard or percentage limitation will be determined immediately after and as a result of the fund's acquisition of such security or other asset. Accordingly, any subsequent change in values, net assets, or other circumstances will not be considered when determining whether the investment complies with the fund's investment policies and limitations. The fund's fundamental investment policies and limitations cannot be changed without approval by a "majority of the outstanding voting securities" (as defined in the Investment Company Act of 1940 (the 1940 Act)) of the fund. However, except for the fundamental investment limitations listed below, the investment policies and limitations described in this SAI are not fundamental and may be changed without shareholder approval. THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH IN THEIR ENTIRETY. THE FUND MAY NOT: (1) with respect to 75% of the fund's total assets, purchase the securities of any issuer (other than securities issued or guaranteed by the U.S. government or any of its agencies or instrumentalities, or securities of other investment companies) if, as a result, (a) more than 5% of the fund's total assets would be invested in the securities of that issuer, or (b) the fund would hold more than 10% of the outstanding voting securities of that issuer; (2) issue senior securities, except as permitted under the Investment Company Act of 1940; (3) borrow money, except that the fund may borrow money for temporary or emergency purposes (not for leveraging or investment) in an amount not exceeding 33 1/3% of its total assets (including the amount borrowed) less liabilities (other than borrowings). Any borrowings that come to exceed this amount will be reduced within three days (not including Sundays and holidays) to the extent necessary to comply with the 33 1/3% limitation; (4) underwrite securities issued by others, except to the extent that the fund may be considered an underwriter within the meaning of the Securities Act of 1933 in the disposition of restricted securities; (5) purchase the securities of any issuer (other than securities issued or guaranteed by the U.S. government or any of its agencies or instrumentalities) if, as a result, more than 25% of the fund's total assets would be invested in the securities of companies whose principal business activities are in the same industry; (6) purchase or sell real estate unless acquired as a result of ownership of securities or other instruments (but this shall not prevent the fund from investing in securities or other instruments backed by real estate or securities of companies engaged in the real estate business); (7) purchase or sell physical commodities unless acquired as a result of ownership of securities or other instruments (but this shall not prevent the fund from purchasing or selling options and futures contracts or from investing in securities or other instruments backed by physical commodities); or (8) lend any security or make any other loan if, as a result, more than 33 1/3% of its total assets would be lent to other parties, but this limitation does not apply to purchases of debt securities or to repurchase agreements. (9) The fund may, notwithstanding any other fundamental investment policy or limitation, invest all of its assets in the securities of a single open-end management investment company managed by Fidelity Management & Research Company or an affiliate or successor with substantially the same fundamental investment objective, policies, and limitations as the fund. THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED WITHOUT SHAREHOLDER APPROVAL: (i) The fund does not currently intend to sell securities short, unless it owns or has the right to obtain securities equivalent in kind and amount to the securities sold short, and provided that transactions in futures contracts and options are not deemed to constitute selling securities short. (ii) The fund does not currently intend to purchase securities on margin, except that the fund may obtain such short-term credits as are necessary for the clearance of transactions, and provided that margin payments in connection with futures contracts and options on futures contracts shall not constitute purchasing securities on margin. (iii) The fund may borrow money only (a) from a bank or from a registered investment company or portfolio for which FMR or an affiliate serves as investment adviser or (b) by engaging in reverse repurchase agreements with any party (reverse repurchase agreements are treated as borrowings for purposes of fundamental investment limitation (3)). The fund will not borrow from other funds advised by FMR or its affiliates if total outstanding borrowings immediately after such borrowing would exceed 15% of the fund's total assets. (iv) The fund does not currently intend to purchase any security if, as a result, more than 10% of its net assets would be invested in securities that are deemed to be illiquid because they are subject to legal or contractual restrictions on resale or because they cannot be sold or disposed of in the ordinary course of business at approximately the prices at which they are valued. (v) The fund does not currently intend to lend assets other than securities to other parties, except by (a) lending money (up to 5% of the fund's net assets) to a registered investment company or portfolio for which FMR or an affiliate serves as investment adviser or (b) acquiring loans, loan participations, or other forms of direct debt instruments and, in connection therewith, assuming any associated unfunded commitments of the sellers. (This limitation does not apply to purchases of debt securities or to repurchase agreements.) (vi) The fund does not currently intend to invest all of its assets in the securities of a single open-end management investment company managed by Fidelity Management & Research Company or an affiliate or successor with substantially the same fundamental investment objective, policies, and limitations as the fund. With respect to limitation (iv), if through a change in values, net assets, or other circumstances, the fund were in a position where more than 10% of its net assets was invested in illiquid securities, it would consider appropriate steps to protect liquidity. For the fund's limitations on futures and options transactions, see the section entitled "Limitations on Futures and Options Transactions" on page . The following pages contain more detailed information about types of instruments in which the fund may invest, strategies FMR may employ in pursuit of the fund's investment objective, and a summary of related risks. FMR may not buy all of these instruments or use all of these techniques unless it believes that doing so will help the fund achieve its goal. AFFILIATED BANK TRANSACTIONS. A fund may engage in transactions with financial institutions that are, or may be considered to be, "affiliated persons" of the fund under the 1940 Act. These transactions may involve repurchase agreements with custodian banks; short-term obligations of, and repurchase agreements with, the 50 largest U.S. banks (measured by deposits); municipal securities; U.S. Government securities with affiliated financial institutions that are primary dealers in these securities; short-term currency transactions; and short-term borrowings. In accordance with exemptive orders issued by the Securities and Exchange Commission (SEC), the Board of Trustees has established and periodically reviews procedures applicable to transactions involving affiliated financial institutions. ASSET-BACKED SECURITIES represent interests in pools of mortgages, loans, receivables or other assets. Payment of interest and repayment of principal may be largely dependent upon the cash flows generated by the assets backing the securities and, in certain cases, supported by letters of credit, surety bonds, or other credit enhancements. Asset-backed security values may also be affected by the creditworthiness of the servicing agent for the pool, the originator of the loans or receivables, or the entities providing the credit enhancement. In addition, these securities may be subject to prepayment risk. CLOSED-END INVESTMENT COMPANIES are investment companies that issue a fixed number of shares which trade on a stock exchange or over-the-counter. Closed-end investment companies are professionally managed and may invest in any type of secu rity. Shares of closed-end investment companies may trade at a premium or a discount to their net asset value. A fund may purchase shares of closed-end investment companies to facilitate investment in certain foreign countries. CONVERTIBLE SECURITIES are bonds, debentures, notes, preferred stocks or other securities that may be converted or exchanged (by the holder or by the issuer) into shares of the underlying common stock (or cash or securities of equivalent value) at a stated exchange ratio. A convertible security may also be called for redemption or conversion by the issuer after a particular date and under certain circumstances (including a specified price) established upon issue. If a convertible security held by a fund is called for redemption or conversion, the fund could be required to tender it for redemption, convert it into the underlying common stock, or sell it to a third party. Convertible securities generally have less potential for gain or loss than common stocks. Convertible securities generally provide yields higher than the underlying common stocks, but generally lower than comparable non-convertible securities. Because of this higher yield, convertible securities generally sell at prices above their "conversion value," which is the current market value of the stock to be received upon conversion. The difference between this conversion value and the price of convertible securities will vary over time depending on changes in the value of the underlying common stocks and interest rates. When the underlying common stocks decline in value, convertible securities will tend not to decline to the same extent because of the interest or dividend payments and the repayment of principal at maturity for certain types of convertible securities. However, securities that are convertible other than at the option of the holder generally do not limit the potential for loss to the same extent as securities convertible at the option of the holder. When the underlying common stocks rise in value, the value of convertible securities may also be expected to increase. At the same time, however, the difference between the market value of convertible securities and their conversion value will narrow, which means that the value of convertible securities will generally not increase to the same extent as the value of the underlying common stocks. Because convertible securities may also be interest-rate sensitive, their value may increase as interest rates fall and decrease as interest rates rise. Convertible securities are also subject to credit risk, and are often lower-quality securities. EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies, and securities issued by U.S. entities with substantial foreign operations may involve significant risks in addition to the risks inherent in U.S. investments. Foreign investments involve risks relating to local political, economic, regulatory, or social instability, military action or unrest, or adverse diplomatic developments, and may be affected by actions of foreign governments adverse to the interests of U.S. investors. Such actions may include expropriation or nationalization of assets, confiscatory taxation, restrictions on U.S. investment or on the ability to repatriate assets or convert currency into U.S. dollars, or other government intervention. There is no assurance that FMR will be able to anticipate these potential events or counter their effects. In addition, the value of securities denominated in foreign currencies and of dividends and interest paid with respect to such securities will fluctuate based on the relative strength of the U.S. dollar. It is anticipated that in most cases the best available market for foreign securities will be on an exchange or in over-the-counter (OTC) markets located outside of the United States. Foreign stock markets, while growing in volume and sophistication, are generally not as developed as those in the United States, and securities of some foreign issuers may be less liquid and more volatile than securities of comparable U.S. issuers. Foreign security trading, settlement and custodial practices (including those involving securities settlement where fund assets may be released prior to receipt of payment) are often less developed than those in U.S. markets, and may result in increased risk or substantial delays in the event of a failed trade or the insolvency of, or breach of duty by, a foreign broker-dealer, securities depository or foreign subcustodian. In addition, the costs associated with foreign investments, including withholding taxes, brokerage commissions and custodial costs, are generally higher than with U.S. investments. Foreign markets may offer less protection to investors than U.S. markets. Foreign issuers are generally not bound by uniform accounting, auditing, and financial reporting requirements and standards of practice comparable to those applicable to U.S. issuers. Adequate public information on foreign issuers may not be available, and it may be difficult to secure dividends and information regarding corporate actions on a timely basis. In general, there is less overall governmental supervision and regulation of securities exchanges, brokers, and listed companies than in the United States. OTC markets tend to be less regulated than stock exchange markets and, in certain countries, may be totally unregulated. Regulatory enforcement may be influenced by economic or political concerns, and investors may have difficulty enforcing their legal rights in foreign countries. Some foreign securities impose restrictions on transfer within the United States or to U.S. persons. Although securities subject to such transfer restrictions may be marketable abroad, they may be less liquid than foreign securities of the same class that are not subject to such restrictions. American Depositary Receipts (ADRs) as well as other "hybrid" forms of ADRs, including European Depositary Receipts (EDRs) and Global Depositary Receipts (GDRs), are certificates evidencing ownership of shares of a foreign issuer. These certificates are issued by depository banks and generally trade on an established market in the United States or elsewhere. The underlying shares are held in trust by a custodian bank or similar financial institution in the issuer's home country. The depository bank may not have physical custody of the underlying securities at all times and may charge fees for various services, including forwarding dividends and interest and corporate actions. ADRs are alternatives to directly purchasing the underlying foreign securities in their national markets and currencies. However, ADRs continue to be subject to many of the risks associated with investing directly in foreign securities. These risks include foreign exchange risk as well as the political and economic risks of the underlying issuer's country. The risks of foreign investing may be magnified for investments in emerging markets. Security prices in emerging markets can be significantly more volatile than those in more developed markets, reflecting the greater uncertainties of investing in less established markets and economies. In particular, countries with emerging markets may have relatively unstable governments, may present the risks of nationalization of businesses, restrictions on foreign ownership and prohibitions on the repatriation of assets, and may have less protection of property rights than more developed countries. The economies of countries with emerging markets may be based on only a few industries, may be highly vulnerable to changes in local or global trade conditions, and may suffer from extreme and volatile debt burdens or inflation rates. Local securities markets may trade a small number of securities and may be unable to respond effectively to increases in trading volume, potentially making prompt liquidation of holdings difficult or impossible at times. FOREIGN CURRENCY TRANSACTIONS. A fund may conduct foreign currency transactions on a spot (i.e., cash) or forward basis (i.e., by entering into forward contracts to purchase or sell foreign currencies). Although foreign exchange dealers generally do not charge a fee for such conversions, they do realize a profit based on the difference between the prices at which they are buying and selling various currencies. Thus, a dealer may offer to sell a foreign currency at one rate, while offering a lesser rate of exchange should the counterparty desire to resell that currency to the dealer. Forward contracts are customized transactions that require a specific amount of a currency to be delivered at a specific exchange rate on a specific date or range of dates in the future. Forward contracts are generally traded in an interbank market directly between currency traders (usually large commercial banks) and their customers. The parties to a forward contract may agree to offset or terminate the contract before its maturity, or may hold the contract to maturity and complete the contemplated currency exchange. A fund may use currency forward contracts for any purpose consistent with its investment objective. The following discussion summarizes the principal currency management strategies involving forward contracts that could be used by a fund. A fund may also use swap agreements, indexed securities, and options and futures contracts relating to foreign currencies for the same purposes. A "settlement hedge" or "transaction hedge" is designed to protect a fund against an adverse change in foreign currency values between the date a security is purchased or sold and the date on which payment is made or received. Entering into a forward contract for the purchase or sale of the amount of foreign currency involved in an underlying security transaction for a fixed amount of U.S. dollars "locks in" the U.S. dollar price of the security. Forward contracts to purchase or sell a foreign currency may also be used by a fund in anticipation of future purchases or sales of securities denominated in foreign currency, even if the specific investments have not yet been selected by FMR. A fund may also use forward contracts to hedge against a decline in the value of existing investments denominated in foreign currency. For example, if a fund owned securities denominated in pounds sterling, it could enter into a forward contract to sell pounds sterling in return for U.S. dollars to hedge against possible declines in the pound's value. Such a hedge, sometimes referred to as a "position hedge," would tend to offset both positive and negative currency fluctuations, but would not offset changes in security values caused by other factors. A fund could also hedge the position by selling another currency expected to perform similarly to the pound sterling. This type of hedge, sometimes referred to as a "proxy hedge," could offer advantages in terms of cost, yield, or efficiency, but generally would not hedge currency exposure as effectively as a direct hedge into U.S. dollars. Proxy hedges may result in losses if the currency used to hedge does not perform similarly to the currency in which the hedged securities are denominated. A fund may enter into forward contracts to shift its investment exposure from one currency into another. This may include shifting exposure from U.S. dollars to a foreign currency, or from one foreign currency to another foreign currency. This type of strategy, sometimes known as a "cross-hedge," will tend to reduce or eliminate exposure to the currency that is sold, and increase exposure to the currency that is purchased, much as if a fund had sold a security denominated in one currency and purchased an equivalent security denominated in another. Cross-hedges protect against losses resulting from a decline in the hedged currency, but will cause a fund to assume the risk of fluctuations in the value of the currency it purchases. Under certain conditions, SEC guidelines require mutual funds to set aside appropriate liquid assets in a segregated custodial account to cover currency forward contracts. As required by SEC guidelines, a fund will segregate assets to cover currency forward contracts, if any, whose purpose is essentially speculative. A fund will not segregate assets to cover forward contracts entered into for hedging purposes, including settlement hedges, position hedges, and proxy hedges. Successful use of currency management strategies will depend on FMR's skill in analyzing currency values. Currency management strategies may substantially change a fund's investment exposure to changes in currency exchange rates and could result in losses to a fund if currencies do not perform as FMR anticipates. For example, if a currency's value rose at a time when FMR had hedged a fund by selling that currency in exchange for dollars, a fund would not participate in the currency's appreciation. If FMR hedges currency exposure through proxy hedges, a fund could realize currency losses from both the hedge and the security position if the two currencies do not move in tandem. Similarly, if FMR increases a fund's exposure to a foreign currency and that currency's value declines, a fund will realize a loss. There is no assurance that FMR's use of currency management strategies will be advantageous to a fund or that it will hedge at appropriate times. FUND'S RIGHTS AS A SHAREHOLDER. The fund does not intend to direct or administer the day-to-day operations of any company. A fund, however, may exercise its rights as a shareholder and may communicate its views on important matters of policy to management, the Board of Directors, and shareholders of a company when FMR determines that such matters could have a significant effect on the value of the fund's investment in the company. The activities in which a fund may engage, either individually or in conjunction with others, may include, among others, supporting or opposing proposed changes in a company's corporate structure or business activities; seeking changes in a company's directors or management; seeking changes in a company's direction or policies; seeking the sale or reorganization of the company or a portion of its assets; or supporting or opposing third-party takeover efforts. This area of corporate activity is increasingly prone to litigation and it is possible that a fund could be involved in lawsuits related to such activities. FMR will monitor such activities with a view to mitigating, to the extent possible, the risk of litigation against a fund and the risk of actual liability if a fund is involved in litigation. No guarantee can be made, however, that litigation against a fund will not be undertaken or liabilities incurred. FUTURES AND OPTIONS. The following paragraphs pertain to futures and options: Asset Coverage for Futures and Options Positions, Combined Positions, Correlation of Price Changes, Futures Contracts, Futures Margin Payments, Limitations on Futures and Options Transactions, Liquidity of Options and Futures Contracts, Options and Futures Relating to Foreign Currencies, OTC Options, Purchasing Put and Call Options, and Writing Put and Call Options. ASSET COVERAGE FOR FUTURES AND OPTIONS POSITIONS. The fund will comply with guidelines established by the SEC with respect to coverage of options and futures strategies by mutual funds and, if the guidelines so require, will set aside appropriate liquid assets in a segregated custodial account in the amount prescribed. Securities held in a segregated account cannot be sold while the futures or option strategy is outstanding, unless they are replaced with other suitable assets. As a result, there is a possibility that segregation of a large percentage of the fund's assets could impede portfolio management or the fund's ability to meet redemption requests or other current obligations. COMBINED POSITIONS involve purchasing and writing options in combination with each other, or in combination with futures or forward contracts, to adjust the risk and return characteristics of the overall position. For example, purchasing a put option and writing a call option on the same underlying instrument would construct a combined position whose risk and return characteristics are similar to selling a futures contract. Another possible combined position would involve writing a call option at one strike price and buying a call option at a lower price, to reduce the risk of the written call option in the event of a substantial price increase. Because combined options positions involve multiple trades, they result in higher transaction costs and may be more difficult to open and close out. CORRELATION OF PRICE CHANGES. Because there are a limited number of types of exchange-traded options and futures contracts, it is likely that the standardized contracts available will not match a fund's current or anticipated investments exactly. A fund may invest in options and futures contracts based on securities with different issuers, maturities, or other characteristics from the secu rities in which the fund typically invests, which involves a risk that the options or futures position will not track the performance of the fund's other investments. Options and futures prices can also diverge from the prices of their underlying instruments, even if the underlying instruments match a fund's investments well. Options and futures prices are affected by such factors as current and anticipated short-term interest rates, changes in volatility of the underlying instrument, and the time remaining until expiration of the contract, which may not affect security prices the same way. Imperfect correlation may also result from differing levels of demand in the options and futures markets and the securities markets, from structural differences in how options and futures and securities are traded, or from imposition of daily price fluctuation limits or trading halts. A fund may purchase or sell options and futures contracts with a greater or lesser value than the securities it wishes to hedge or intends to purchase in order to attempt to compensate for differences in volatility between the contract and the securities, although this may not be successful in all cases. If price changes in a fund's options or futures positions are poorly correlated with its other investments, the positions may fail to produce anticipated gains or result in losses that are not offset by gains in other investments. FUTURES CONTRACTS. In purchasing a futures contract, the buyer agrees to purchase a specified underlying instrument at a speci fied future date. In selling a futures contract, the seller agrees to sell a specified underlying instrument at a specified future date. The price at which the purchase and sale will take place is fixed when the buyer and seller enter into the contract. Some currently available futures contracts are based on specific securities, such as U.S. Treasury bonds or notes, and some are based on indices of securities prices, such as the Standard & Poor's 500 Index (S&P 500). Futures can be held until their delivery dates, or can be closed out before then if a liquid secondary market is available. The value of a futures contract tends to increase and decrease in tandem with the value of its underlying instrument. Therefore, purchasing futures contracts will tend to increase a fund's exposure to positive and negative price fluctuations in the underlying instrument, much as if it had purchased the underlying instrument directly. When a fund sells a futures contract, by contrast, the value of its futures position will tend to move in a direction contrary to the market. Selling futures contracts, therefore, will tend to offset both positive and negative market price changes, much as if the underlying instrument had been sold. FUTURES MARGIN PAYMENTS. The purchaser or seller of a futures contract is not required to deliver or pay for the underlying instrument unless the contract is held until the delivery date. However, both the purchaser and seller are required to deposit "initial margin" with a futures broker, known as a futures commission merchant (FCM), when the contract is entered into. Initial margin deposits are typically equal to a percentage of the contract's value. If the value of either party's position declines, that party will be required to make additional "variation margin" payments to settle the change in value on a daily basis. The party that has a gain may be entitled to receive all or a portion of this amount. Initial and variation margin payments do not constitute purchasing securities on margin for purposes of a fund's investment limitations. In the event of the bankruptcy of an FCM that holds margin on behalf of a fund, the fund may be entitled to return of margin owed to it only in proportion to the amount received by the FCM's other customers, potentially resulting in losses to the fund. LIMITATIONS ON FUTURES AND OPTIONS TRANSACTIONS. The fund intends to file a notice of eligibility for exclusion from the definition of the term "commodity pool operator" with the Commodity Futures Trading Commission (CFTC) and the National Futures Association, which regulate trading in the futures markets, before engaging in any purchases or sales of futures contracts or options on futures contracts . The fund intends to comply with Rule 4.5 under the Commodity Exchange Act, which limits the extent to which the fund can commit assets to initial margin deposits and option premiums. In addition, the fund will not: (a) sell futures contracts, purchase put options, or write call options if, as a result, more than 25% of the fund's total assets would be hedged with futures and options under normal conditions; (b) purchase futures contracts or write put options if, as a result, the fund's total obligations upon settlement or exercise of purchased futures contracts and written put options would exceed 25% of its total assets; or (c) purchase call options if, as a result, the current value of option premiums for call options purchased by the fund would exceed 5% of the fund's total assets. These limitations do not apply to options attached to or acquired or traded together with their underlying securities, and do not apply to securities that incorporate features similar to options. The above limitations on the fund's investments in futures contracts and options, and the fund's policies regarding futures contracts and options discussed elsewhere in this SAI, may be changed as regulatory agencies permit. LIQUIDITY OF OPTIONS AND FUTURES CONTRACTS. There is no assurance a liquid secondary market will exist for any particular options or futures contract at any particular time. Options may have relatively low trading volume and liquidity if their strike prices are not close to the underlying instrument's current price. In addition, exchanges may establish daily price fluctuation limits for options and futures contracts, and may halt trading if a contract's price moves upward or downward more than the limit in a given day. On volatile trading days when the price fluctuation limit is reached or a trading halt is imposed, it may be impossible to enter into new positions or close out existing positions. If the secondary market for a contract is not liquid because of price fluctuation limits or otherwise, it could prevent prompt liquidation of unfavorable positions, and potentially could require a fund to continue to hold a position until delivery or expiration regardless of changes in its value. As a result, a fund's access to other assets held to cover its options or futures positions could also be impaired. OPTIONS AND FUTURES RELATING TO FOREIGN CURRENCIES. Currency futures contracts are similar to forward currency exchange contracts, except that they are traded on exchanges (and have margin requirements) and are standardized as to contract size and delivery date. Most currency futures contracts call for payment or delivery in U.S. dollars. The underlying instrument of a currency option may be a foreign currency, which generally is purchased or delivered in exchange for U.S. dollars, or may be a futures contract. The purchaser of a currency call obtains the right to purchase the underlying currency, and the purchaser of a currency put obtains the right to sell the underlying currency. The uses and risks of currency options and futures are similar to options and futures relating to securities or indices, as discussed above. A fund may purchase and sell currency futures and may purchase and write currency options to increase or decrease its exposure to different foreign currencies. Currency options may also be purchased or written in conjunction with each other or with currency futures or forward contracts. Currency futures and options values can be expected to correlate with exchange rates, but may not reflect other factors that affect the value of a fund's investments. A currency hedge, for example, should protect a Yen-denominated security from a decline in the Yen, but will not protect a fund against a price decline resulting from deterioration in the issuer's creditworthiness. Because the value of a fund's foreign-denominated investments changes in response to many factors other than exchange rates, it may not be possible to match the amount of currency options and futures to the value of the fund's investments exactly over time. OTC OPTIONS. Unlike exchange-traded options, which are standardized with respect to the underlying instrument, expiration date, contract size, and strike price, the terms of over-the-counter (OTC) options (options not traded on exchanges) generally are established through negotiation with the other party to the option contract. While this type of arrangement allows the purchaser or writer greater flexibility to tailor an option to its needs, OTC options generally involve greater credit risk than exchange-traded options, which are guaranteed by the clearing organization of the exchanges where they are traded. PURCHASING PUT AND CALL OPTIONS. By purchasing a put option, the purchaser obtains the right (but not the obligation) to sell the option's underlying instrument at a fixed strike price. In return for this right, the purchaser pays the current market price for the option (known as the option premium). Options have various types of underlying instruments, including specific securities, in dices of securities prices, and futures contracts. The purchaser may terminate its position in a put option by allowing it to expire or by exercising the option. If the option is allowed to expire, the purchaser will lose the entire premium. If the option is exercised, the purchaser completes the sale of the underlying instrument at the strike price. A purchaser may also terminate a put option position by closing it out in the secondary market at its current price, if a liquid secondary market exists. The buyer of a typical put option can expect to realize a gain if security prices fall substantially. However, if the underlying instrument's price does not fall enough to offset the cost of purchasing the option, a put buyer can expect to suffer a loss (limited to the amount of the premium, plus related transaction costs). The features of call options are essentially the same as those of put options, except that the purchaser of a call option obtains the right to purchase, rather than sell, the underlying instrument at the option's strike price. A call buyer typically attempts to participate in potential price increases of the underlying instrument with risk limited to the cost of the option if security prices fall. At the same time, the buyer can expect to suffer a loss if security prices do not rise sufficiently to offset the cost of the option. WRITING PUT AND CALL OPTIONS. The writer of a put or call option takes the opposite side of the transaction from the option's purchaser. In return for receipt of the premium, the writer assumes the obligation to pay the strike price for the option's underlying instrument if the other party to the option chooses to exercise it. The writer may seek to terminate a position in a put option before exercise by closing out the option in the secondary market at its current price. If the secondary market is not liquid for a put option, however, the writer must continue to be prepared to pay the strike price while the option is outstanding, regardless of price changes, and must continue to set aside assets to cover its position. When writing an option on a futures contract, a fund will be required to make margin payments to an FCM as described above for futures contracts. If security prices rise, a put writer would generally expect to profit, although its gain would be limited to the amount of the premium it received. If security prices remain the same over time, it is likely that the writer will also profit, because it should be able to close out the option at a lower price. If security prices fall, the put writer would expect to suffer a loss. This loss should be less than the loss from purchasing the underlying instrument directly, however, because the premium received for writing the option should mitigate the effects of the decline. Writing a call option obligates the writer to sell or deliver the option's underlying instrument, in return for the strike price, upon exercise of the option. The characteristics of writing call options are similar to those of writing put options, except that writing calls generally is a profitable strategy if prices remain the same or fall. Through receipt of the option premium, a call writer mitigates the effects of a price decline. At the same time, because a call writer must be prepared to deliver the underlying instrument in return for the strike price, even if its current value is greater, a call writer gives up some ability to participate in security price increases. ILLIQUID INVESTMENTS are investments that cannot be sold or disposed of in the ordinary course of business at approximately the prices at which they are valued. Under the supervision of the Board of Trustees, FMR determines the liquidity of a fund's investments and, through reports from FMR, the Board monitors investments in illiquid instruments. In determining the liquidity of a fund's investments, FMR may consider various factors, including (1) the frequency of trades and quotations, (2) the number of dealers and prospective purchasers in the marketplace, (3) dealer undertakings to make a market, (4) the nature of the security (including any demand or tender features), and (5) the nature of the marketplace for trades (including the ability to assign or offset the fund's rights and obligations relating to the investment). Investments currently considered by FMR to be illiquid include repurchase agreements not entitling the holder to repayment of principal and payment of interest within seven days, over-the-counter options, and non-government stripped fixed-rate mort gage-backed securities. Also, FMR may determine some restricted securities, government-stripped fixed-rate mortgage-backed securities, loans and other direct debt instruments, emerging market securities, and swap agreements to be illiquid. However, with respect to over-the-counter options a fund writes, all or a portion of the value of the underlying instrument may be illiquid depending on the assets held to cover the option and the nature and terms of any agreement the fund may have to close out the option before expiration. In the absence of market quotations, illiquid investments are priced at fair value as determined in good faith by a committee appointed by the Board of Trustees. INDEXED SECURITIES are instruments whose prices are indexed to the prices of other securities, securities indices, currencies, precious metals or other commodities, or other financial indicators. Indexed securities typically, but not always, are debt securities or deposits whose value at maturity or coupon rate is determined by reference to a specific instrument or statistic. Mortgage-indexed securities, for example, could be structured to replicate the performance of mortgage securities and the characteristics of direct ownership. Gold-indexed securities typically provide for a maturity value that depends on the price of gold, resulting in a security whose price tends to rise and fall together with gold prices. Currency-indexed securities typically are short-term to intermediate-term debt securities whose maturity values or interest rates are determined by reference to the values of one or more specified foreign currencies, and may offer higher yields than U.S. dollar-denominated securities. Currency-indexed securities may be positively or negatively indexed; that is, their maturity value may increase when the specified currency value increases, resulting in a security that performs similarly to a foreign-denominated instrument, or their maturity value may decline when foreign currencies increase, resulting in a security whose price characteristics are similar to a put on the underlying currency. Currency-indexed securities may also have prices that depend on the values of a number of different foreign currencies relative to each other. The performance of indexed securities depends to a great extent on the performance of the security, currency, or other instrument to which they are indexed, and may also be influenced by interest rate changes in the United States and abroad. Indexed securities may be more volatile than the underlying instruments. Indexed securities are also subject to the credit risks associated with the issuer of the security, and their values may decline substantially if the issuer's creditworthiness deteriorates. Recent issuers of indexed securities have included banks, corporations, and certain U.S. Government agencies. INTERFUND BORROWING AND LENDING PROGRAM. Pursuant to an exemptive order issued by the SEC, a fund may lend money to, and borrow money from, other funds advised by FMR or its affiliates. A fund will lend through the program only when the returns are higher than those available from an investment in repurchase agreements, and will borrow through the program only when the costs are equal to or lower than the cost of bank loans. Interfund loans and borrowings normally extend overnight, but can have a maximum duration of seven days. Loans may be called on one day's notice. A fund may have to borrow from a bank at a higher interest rate if an interfund loan is called or not renewed. Any delay in repayment to a lending fund could result in a lost investment opportunity or additional borrowing costs. LOANS AND OTHER DIRECT DEBT INSTRUMENTS. Direct debt instruments are interests in amounts owed by a corporate, governmental, or other borrower to lenders or lending syndicates (loans and loan participations), to suppliers of goods or services (trade claims or other receivables), or to other parties. Direct debt instruments are subject to a fund's policies regarding the quality of debt securities. Purchasers of loans and other forms of direct indebtedness depend primarily upon the creditworthiness of the borrower for payment of interest and repayment of principal. Direct debt instruments may not be rated by any nationally recognized statistical rating service. If scheduled interest or principal payments are not made, the value of the instrument may be adversely affected. Loans that are fully secured provide more protections than an unsecured loan in the event of failure to make scheduled interest or principal payments. However, there is no assurance that the liquidation of collateral from a secured loan would satisfy the borrow er's obligation, or that the collateral could be liquidated. Indebtedness of borrowers whose creditworthiness is poor involves substantially greater risks and may be highly speculative. Borrowers that are in bankruptcy or restructuring may never pay off their indebtedness, or may pay only a small fraction of the amount owed. Direct indebtedness of developing countries also involves a risk that the governmental entities responsible for the repayment of the debt may be unable, or unwilling, to pay interest and repay principal when due. Investments in loans through direct assignment of a financial institution's interests with respect to a loan may involve addition al risks. For example, if a loan is foreclosed, the purchaser could become part owner of any collateral, and would bear the costs and liabilities associated with owning and disposing of the collateral. In addition, it is conceivable that under emerging legal theories of lender liability, a purchaser could be held liable as a co-lender. Direct debt instruments may also involve a risk of insolvency of the lending bank or other intermediary. Direct debt instruments that are not in the form of securities may offer less legal protection to the purchaser in the event of fraud or misrepresentation. In the absence of definitive regulatory guidance, FMR uses its research to attempt to avoid situations where fraud or misrepresentation could adversely affect a fund. A loan is often administered by a bank or other financial institution that acts as agent for all holders. The agent administers the terms of the loan, as specified in the loan agreement. Unless, under the terms of the loan or other indebtedness, the purchaser has direct recourse against the borrower, the purchaser may have to rely on the agent to apply appropriate credit remedies against a borrower. If assets held by the agent for the benefit of a purchaser were determined to be subject to the claims of the agent's general creditors, the purchaser might incur certain costs and delays in realizing payment on the loan or loan participation and could suffer a loss of principal or interest. Direct indebtedness may include letters of credit, revolving credit facilities, or other standby financing commitments that obligate purchasers to make additional cash payments on demand. These commitments may have the effect of requiring a purchaser to increase its investment in a borrower at a time when it would not otherwise have done so, even if the borrower's condi tion makes it unlikely that the amount will ever be repaid. A fund will set aside appropriate liquid assets in a segregated custodial account to cover its potential obligations under standby financing commitments. The fund limits the amount of total assets that it will invest in any one issuer or in issuers within the same industry (see the fund's investment limitations). For purposes of these limitations, a fund generally will treat the borrower as the "issuer" of in debtedness held by the fund. In the case of loan participations where a bank or other lending institution serves as financial intermediary between a fund and the borrower, if the participation does not shift to the fund the direct debtor-creditor relationship with the borrower, SEC interpretations require a fund, in appropriate circumstances, to treat both the lending bank or other lending institution and the borrower as "issuers" for these purposes. Treating a financial intermediary as an issuer of indebtedness may restrict a fund's ability to invest in indebtedness related to a single financial intermediary, or a group of intermediaries engaged in the same industry, even if the underlying borrowers represent many different companies and industries. LOWER-QUALITY DEBT SECURITIES. Lower-quality debt securities have poor protection with respect to the payment of interest and repayment of principal. These securities are often considered to be speculative and involve greater risk of loss or price changes due to changes in the issuer's capacity to pay. The market prices of lower-quality debt securities may fluctuate more than those of higher-quality debt securities and may decline significantly in periods of general economic difficulty, which may follow periods of rising interest rates. While the market for high-yield corporate debt securities has been in existence for many years and has weathered previous economic downturns, the 1980s brought a dramatic increase in the use of such securities to fund highly leveraged corporate acquisitions and restructurings. Past experience may not provide an accurate indication of the future performance of the high-yield bond market, especially during periods of economic recession. The market for lower-quality debt securities may be thinner and less active than that for higher-quality debt securities, which can adversely affect the prices at which the former are sold. If market quotations are not available, lower-quality debt securities will be valued in accordance with procedures established by the Board of Trustees, including the use of outside pricing services. Judgment plays a greater role in valuing high-yield debt securities than is the case for securities for which more external sources for quotations and last-sale information are available. Adverse publicity and changing investor perceptions may affect the liquidity of lower-quality debt securities and the ability of outside pricing services to value lower-quality debt securities. Since the risk of default is higher for lower-quality debt securities, FMR's research and credit analysis are an especially impor tant part of managing securities of this type. FMR will attempt to identify those issuers of high-yielding securities whose financial condition is adequate to meet future obligations, has improved, or is expected to improve in the future. FMR's analysis focuses on relative values based on such factors as interest or dividend coverage, asset coverage, earnings prospects, and the experience and managerial strength of the issuer. A fund may choose, at its expense or in conjunction with others, to pursue litigation or otherwise to exercise its rights as a security holder to seek to protect the interests of security holders if it determines this to be in the best interest of the fund's shareholders. MORTGAGE-BACKED SECURITIES are issued by government and non-government entities such as banks, mortgage lenders, or other institutions. A mortgage-backed security is an obligation of the issuer backed by a mortgage or pool of mortgages or a direct interest in an underlying pool of mortgages. Some mortgage-backed securities, such as collateralized mortgage obligations (or "CMOs"), make payments of both principal and interest at a range of specified intervals; others make semiannual interest payments at a predetermined rate and repay principal at maturity (like a typical bond). Mortgage-backed securities are based on different types of mortgages, including those on commercial real estate or residential properties. Stripped mortgage-backed securities are created when the interest and principal components of a mortgage-backed security are separated and sold as individual securities. In the case of a stripped mortgage-backed security, the holder of the "principal-only" security (PO) receives the principal payments made by the underlying mortgage, while the holder of the "interest-only" security (IO) receives interest payments from the same underlying mortgage. The value of mortgage-backed securities may change due to shifts in the market's perception of issuers and changes in interest rates. In addition, regulatory or tax changes may adversely affect the mortgage-backed securities market as a whole. Non-gov ernment mortgage-backed securities may offer higher yields than those issued by government entities, but also may be subject to greater price changes than government issues. Mortgage-backed securities are subject to prepayment risk. Prepayment occurs when unscheduled or early payments are made on the underlying mortgages, usually in response to a reduction in interest rates. Mortgage-backed security values may also be adversely affected when prepayments on underlying mortgages do not occur. The prices of stripped mortgage-backed securities tend to be more volatile in response to changes in interest rates than those of non-stripped mortgage-backed securities. REAL ESTATE INVESTMENT TRUSTS. Equity real estate investment trusts own real estate properties, while mortgage real estate investment trusts make construction, development, and long-term mortgage loans. Their value may be affected by changes in the value of the underlying property of the trusts, the creditworthiness of the issuer, property taxes, interest rates, and tax and regulatory requirements, such as those relating to the environment. Both types of trusts are dependent upon management skill, are not diversified, and are subject to heavy cash flow dependency, defaults by borrowers, self-liquidation, and the possibility of failing to qualify for tax-free status of income under the Internal Revenue Code and failing to maintain exemption from the 1940 Act. REPURCHASE AGREEMENTS. In a repurchase agreement, a fund purchases a security and simultaneously commits to sell that security back to the original seller at an agreed-upon price. The resale price reflects the purchase price plus an agreed-upon incre mental amount which is unrelated to the coupon rate or maturity of the purchased security. As protection against the risk that the original seller will not fulfill its obligation, the securities are held in a separate account at a bank, marked-to-market daily, and maintained at a value at least equal to the sale price plus the accrued incremental amount. While it does not presently appear possible to eliminate all risks from these transactions (particularly the possibility that the value of the underlying security will be less than the resale price, as well as delays and costs to a fund in connection with bankruptcy proceedings), the fund will engage in repurchase agreement transactions with parties whose creditworthiness has been reviewed and found satisfactory by FMR. RESTRICTED SECURITIES generally can be sold in privately negotiated transactions, pursuant to an exemption from registration under the Securities Act of 1933, or in a registered public offering. Where registration is required, a fund may be obligated to pay all or part of the registration expense and a considerable period may elapse between the time it decides to seek registration and the time it may be permitted to sell a security under an effective registration statement. If, during such a period, adverse market conditions were to develop, a fund might obtain a less favorable price than prevailed when it decided to seek registration of the security. REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a fund sells a security to another party, such as a bank or broker-dealer, in return for cash and agrees to repurchase that security at an agreed-upon price and time. While a reverse repur chase agreement is outstanding, a fund will maintain appropriate liquid assets in a segregated custodial account to cover its obl igation under the agreement. The fund will enter into reverse repurchase agreements with parties whose creditworthiness has been reviewed and found satisfactory by FMR. Such transactions may increase fluctuations in the market value of fund assets and may be viewed as a form of leverage. SECURITIES LENDING. A fund may lend securities to parties such as broker-dealers or institutional investors, including Fidelity Brokerage Services, Inc. (FBSI). FBSI is a member of the New York Stock Exchange and a subsidiary of FMR Corp. Securities lending allows a fund to retain ownership of the securities loaned and, at the same time, to earn additional income. Since there may be delays in the recovery of loaned securities, or even a loss of rights in collateral supplied should the borrower fail financially, loans will be made only to parties deemed by FMR to be of good standing. Furthermore, they will only be made if, in FMR's judgment, the consideration to be earned from such loans would justify the risk. FMR understands that it is the current view of the SEC Staff that a fund may engage in loan transactions only under the following conditions: (1) the fund must receive 100% collateral in the form of cash or cash equivalents (e.g., U.S. Treasury bills or notes) from the borrower; (2) the borrower must increase the collateral whenever the market value of the securities loaned (determined on a daily basis) rises above the value of the collateral; (3) after giving notice, the fund must be able to terminate the loan at any time; (4) the fund must receive reasonable interest on the loan or a flat fee from the borrower, as well as amounts equivalent to any dividends, interest, or other distributions on the securities loaned and to any increase in market value; (5) the fund may pay only reasonable custodian fees in connection with the loan; and (6) the Board of Trustees must be able to vote proxies on the securities loaned, either by terminating the loan or by entering into an alternative arrangement with the borrower. Cash received through loan transactions may be invested in other eligible securities. Investing this cash subjects that invest ment, as well as the security loaned, to market forces (i.e., capital appreciation or depreciation). SHORT SALES. A fund may enter into short sales with respect to stocks underlying its convertible security holdings. For example, if FMR anticipates a decline in the price of the stock underlying a convertible security a fund holds, it may sell the stock short. If the stock price subsequently declines, the proceeds of the short sale could be expected to offset all or a portion of the effect of the stock's decline on the value of the convertible security. The fund currently intends to hedge no more than 15% of its total assets with short sales on equity securities underlying its convertible security holdings under normal circumstances. When a fund enters into a short sale, it will be required to set aside securities equivalent in kind and amount to those sold short (or securities convertible or exchangeable into such securities) and will be required to hold them aside while the short sale is outstanding. A fund will incur transaction costs, including interest expenses, in connection with opening, maintaining, and closing short sales. SWAP AGREEMENTS can be individually negotiated and structured to include exposure to a variety of different types of investments or market factors. Depending on their structure, swap agreements may increase or decrease a fund's exposure to long- or short-term interest rates (in the United States or abroad), foreign currency values, mortgage securities, corporate borrowing rates, or other factors such as security prices or inflation rates. Swap agreements can take many different forms and are known by a variety of names. In a typical cap or floor agreement, one party agrees to make payments only under specified circumstances, usually in return for payment of a fee by the other party. For example, the buyer of an interest rate cap obtains the right to receive payments to the extent that a specified interest rate exceeds an agreed-upon level, while the seller of an interest rate floor is obligated to make payments to the extent that a specified interest rate falls below an agreed-upon level. An interest rate collar combines elements of buying a cap and selling a floor. Swap agreements will tend to shift a fund's investment exposure from one type of investment to another. For example, if the fund agreed to exchange payments in dollars for payments in foreign currency, the swap agreement would tend to decrease the fund's exposure to U.S. interest rates and increase its exposure to foreign currency and interest rates. Caps and floors have an effect similar to buying or writing options. Depending on how they are used, swap agreements may increase or decrease the overall volatility of a fund's investments and its share price and yield. The most significant factor in the performance of swap agreements is the change in the specific interest rate, currency, or other factors that determine the amounts of payments due to and from a fund. If a swap agreement calls for payments by the fund, the fund must be prepared to make such payments when due. In addition, if the counterparty's creditworthiness declined, the value of a swap agreement would be likely to decline, potentially resulting in losses. A fund may be able to eliminate its exposure under a swap agreement either by assignment or other disposition, or by entering into an offsetting swap agreement with the same party or a similarly creditworthy party. A fund will maintain appropriate liquid assets in a segregated custodial account to cover its current obligations under swap agreements. If a fund enters into a swap agreement on a net basis, it will segregate assets with a daily value at least equal to the excess, if any, of the fund's accrued obligations under the swap agreement over the accrued amount the fund is entitled to receive under the agreement. If a fund enters into a swap agreement on other than a net basis, it will segregate assets with a value equal to the full amount of the fund's accrued obligations under the agreement. WARRANTS. Warrants are instruments which entitle the holder to buy an equity security at a specific price for a specific period of time. Changes in the value of a warrant do not necessarily correspond to changes in the value of its underlying security. The price of a warrant may be more volatile than the price of its underlying security, and a warrant may offer greater potential for capital appreciation as well as capital loss. Warrants do not entitle a holder to dividends or voting rights with respect to the underlying security and do not represent any rights in the assets of the issuing company. A warrant ceases to have value if it is not exercised prior to its expiration date. These factors can make warrants more speculative than other types of investments. PORTFOLIO TRANSACTIONS All orders for the purchase or sale of portfolio securities are placed on behalf of the fund by FMR pursuant to authority contained in the management contract. If FMR grants investment management authority to the sub-advisers (see the section entitled "Management Contract"), the sub-advisers are authorized to place orders for the purchase and sale of portfolio securities, and will do so in accordance with the policies described below. FMR is also responsible for the placement of transaction orders for other investment companies and accounts for which it or its affiliates act as investment adviser. In selecting broker-dealers, subject to applicable limitations of the federal securities laws, FMR considers various relevant factors, including, but not limited to: the size and type of the transaction; the nature and character of the markets for the security to be purchased or sold; the execution efficiency, settlement capability, and financial condition of the broker-dealer firm; the broker-dealer's execution services rendered on a continuing basis; the reasonableness of any commissions; and arrangements for payment of fund expenses. Generally, commissions for investments traded on foreign exchanges will be higher than for investments traded on U.S. exchanges and may not be subject to negotiation. The fund may execute portfolio transactions with broker-dealers who provide research and execution services to the fund or other accounts over which FMR or its affiliates exercise investment discretion. Such services may include advice concerning the value of securities; the advisability of investing in, purchasing, or selling securities; and the availability of securities or the purchasers or sellers of securities. In addition, such broker-dealers may furnish analyses and reports concerning issuers, industries, securities, economic factors and trends, portfolio strategy, and performance of accounts; effect securities transactions, and perform functions incidental thereto (such as clearance and settlement). The selection of such broker-dealers generally is 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 fund may be useful to FMR in rendering investment management services to the fund or its other clients, and conversely, such research provided by broker-dealers who have executed transaction orders on behalf of other FMR clients may be useful to FMR in carrying out its obligations to the fund. The receipt of such research has not reduced FMR's normal independent research activities; however, it enables FMR to avoid the additional expenses that could be incurred if FMR tried to develop comparable information through its own efforts. 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 fund 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 fund or shares of other Fidelity funds to the extent permitted by law. FMR may use research services provided by and place agency transactions with National Financial Services Corporation (NFSC) and Fidelity Brokerage Services ( Japan ), LLC (FBSJ), indirect subsidiaries of FMR Corp., if the commissions are fair, reasonable, and comparable to commissions charged by non-affiliated, qualified brokerage firms for similar services. Prior to December 9, 1997, FMR used research services provided by and placed agency transactions with Fidelity Brokerage Services (FBS), an indirect subsidiary of FMR Corp. FMR may allocate brokerage transactions to broker-dealers who have entered into arrangements with FMR under which the broker-dealer allocates a portion of the commissions paid by the fund toward payment of the fund's expenses, such as transfer agent fees or custodian fees. The transaction quality must, however, be comparable to those of other qualified broker-dealers. Section 11(a) of the Securities Exchange Act of 1934 prohibits members of national securities exchanges from executing exchange transactions for accounts which they or their affiliates manage, unless certain requirements are satisfied. Pursuant to such requirements, the Board of Trustees has authorized NFSC to execute portfolio transactions on national securities exchanges in accordance with approved procedures and applicable SEC rules. The Trustees periodically review FMR's performance of its responsibilities in connection with the placement of portfolio transactions on behalf of the fund and review the commissions paid by the fund over representative periods of time to determine if they are reasonable in relation to the benefits to the fund. The fund's annualized turnover rate for its first fiscal period is not expected to exceed 200%. Because a high turnover rate increases transaction costs and may increase taxable gains, FMR carefully weighs the anticipated benefits of short-term investing against these consequences. From time to time the Trustees will review whether the recapture for the benefit of the fund of some portion of the brokerage commissions or similar fees paid by the fund on portfolio transactions is legally permissible and advisable. The fund seeks to recapture soliciting broker-dealer fees on the tender of portfolio securities, but at present no other recapture arrangements are in effect. The Trustees intend to continue to review whether recapture opportunities are available and are legally permissible and, if so, to determine in the exercise of their business judgment whether it would be advisable for the fund to seek such recapture. Although the Trustees and officers of the fund are substantially the same as those of other funds managed by FMR, investment decisions for the fund are made independently from those of other funds managed by FMR or accounts managed by FMR affiliates. It sometimes happens that the same security is held in the portfolio of more than one of these funds or accounts. Simultaneous transactions are inevitable when several funds and accounts are managed by the same investment adviser, particularly when the same security is suitable for the investment objective of more than one fund or account. When two or more funds are simultaneously engaged in the purchase or sale of the same security, the prices and amounts are allocated in accordance with procedures believed to be appropriate and equitable for each fund. In some cases this system could have a detrimental effect on the price or value of the security as far as the fund is concerned. In other cases, however, the ability of the fund to participate in volume transactions will produce better executions and prices for the fund. It is the current opinion of the Trustees that the desirability of retaining FMR as investment adviser to the fund outweighs any disadvantages that may be said to exist from exposure to simultaneous transactions. VALUATION Fidelity Service Company, Inc. (FSC) normally determines the fund's net asset value per share (NAV) as of the close of the New York Stock Exchange (NYSE) (normally 4:00 p.m. Eastern time). The valuation of portfolio securities is determined as of this time for the purpose of computing the fund's NAV. Portfolio securities are valued by various methods depending on the primary market or exchange on which they trade. Most equity securities for which the primary market is the United States are valued at last sale price or, if no sale has occurred, at the closing bid price. Most equity securities for which the primary market is outside the United States are valued using the official closing price or the last sale price in the principal market in which they are traded. If the last sale price (on the local exchange) is unavailable, the last evaluated quote or last bid price normally is used. Securities of other open-end investment companies are valued at their respective NAVs. Fixed-income securities and other assets for which market quotations are readily available may be valued at market values determined by such securities' most recent bid prices (sales prices if the principal market is an exchange) in the principal market in which they normally are traded, as furnished by recognized dealers in such securities or assets. Or, fixed-income securities and convertible securities may be valued on the basis of information furnished by a pricing service that uses a valuation matrix which incorporates both dealer-supplied valuations and electronic data processing techniques. Use of pricing services has been approved by the Board of Trustees. A number of pricing services are available, and the fund may use various pricing services or discontinue the use of any pricing service. Futures contracts and options are valued on the basis of market quotations, if available. Foreign securities are valued based on prices furnished by independent brokers or quotation services which express the value of securities in their local currency. FSC gathers all exchange rates daily at the close of the NYSE using the last quoted price on the local currency and then translates the value of foreign securities from their local currencies into U.S. dollars. Any changes in the value of forward contracts due to exchange rate fluctuations and days to maturity are included in the calculation of NAV. If an extraordinary event that is expected to materially affect the value of a portfolio security occurs after the close of an exchange on which that security is traded, then that security will be valued as determined in good faith by a committee appointed by the Board of Trustees. Short-term securities with remaining maturities of sixty days or less for which market quotations and information furnished by a pricing service are not readily available are valued either at amortized cost or at original cost plus accrued interest, both of which approximate current value. In addition, securities and other assets for which there is no readily available market value may be valued in good faith by a committee appointed by the Board of Trustees. The procedures set forth above need not be used to determine the value of the securities owned by the fund if, in the opinion of a committee appointed by the Board of Trustees, some other method would more accurately reflect the fair market value of such securities. PERFORMANCE The fund may quote performance in various ways. All performance information supplied by the fund in advertising is historical and is not intended to indicate future returns. The fund's share price, yield, and total return fluctuate in response to market conditions and other factors, and the value of fund shares when redeemed may be more or less than their original cost. YIELD CALCULATIONS. Yields for the fund are computed by dividing the fund's interest and dividend income for a given 30-day or one-month period, net of expenses, by the average number of shares entitled to receive distributions during the period, dividing this figure by the fund's net asset value (NAV) at the end of the period, and annualizing the result (assuming compounding of income) in order to arrive at an annual percentage rate. Income is calculated for purposes of yield quotations in accordance with standardized methods applicable to all stock and bond funds. Dividends from equity investments are treated as if they were accrued on a daily basis, solely for the purposes of yield calculations. In general, interest income is reduced with respect to bonds trading at a premium over their par value by subtracting a portion of the premium from income on a daily basis, and is increased with respect to bonds trading at a discount by adding a portion of the discount to daily income. For the fund's investments denominated in foreign currencies, income and expenses are calculated first in their respective currencies, and are then converted to U.S. dollars, either when they are actually converted or at the end of the 30-day or one month period, whichever is earlier. Capital gains and losses generally are excluded from the calculation as are gains and losses from currency exchange rate fluctuations. Income calculated for the purposes of calculating the fund's yield differs from income as determined for other accounting purposes. Because of the different accounting methods used, and because of the compounding of income assumed in yield calculations, the fund's yield may not equal its distribution rate, the income paid to your account, or the income reported in the fund's financial statements. In calculating the fund's yield, a fund may from time to time use a portfolio security's coupon rate instead of its yield to maturity in order to reflect the risk premium on that security. This practice will have the effect of reducing the fund's yield. Yield information may be useful in reviewing the fund's performance and in providing a basis for comparison with other investment alternatives. However, the fund's yield fluctuates, unlike investments that pay a fixed interest rate over a stated period of time. When comparing investment alternatives, investors should also note the quality and maturity of the portfolio securities of respective investment companies they have chosen to consider. Investors should recognize that in periods of declining interest rates the fund's yield will tend to be somewhat higher than prevailing market rates, and in periods of rising interest rates the fund's yield will tend to be somewhat lower. Also, when interest rates are falling, the inflow of net new money to the fund from the continuous sale of its shares will likely be invested in instruments producing lower yields than the balance of the fund's holdings, thereby reducing the fund's current yield. In periods of rising interest rates, the opposite can be expected to occur. TOTAL RETURN CALCULATIONS. Total returns quoted in advertising reflect all aspects of the fund's return, including the effect of reinvesting dividends and capital gain distributions, and any change in the fund's NAV over a stated period. Average annual total returns are calculated by determining the growth or decline in value of a hypothetical historical investment in the fund over a stated period, and then calculating the annually compounded percentage rate that would have produced the same result if the rate of growth or decline in value had been constant over the period. For example, a cumulative total return of 100% over ten years would produce an average annual total return of 7.18%, which is the steady annual rate of return that would equal 100% growth on a compounded basis in ten years. Average annual total returns covering periods of less than one year are calculated by determining the fund's total return for the period, extending that return for a full year (assuming that return remains constant over the year), and quoting the result as an annual return. While average annual total returns are a convenient means of comparing investment alternatives, investors should realize that the fund's performance is not constant over time, but changes from year to year, and that average annual total returns represent averaged figures as opposed to the actual year-to-year performance of the fund. In addition to average annual total returns, the fund may quote unaveraged or cumulative total returns reflecting the simple change in value of an investment over a stated period. Average annual and cumulative total returns may be quoted as a percentage or as a dollar amount, and may be calculated for a single investment, a series of investments, or a series of redemptions, over any time period. Total returns may be broken down into their components of income and capital (including capital gains and changes in share price) in order to illustrate the relationship of these factors and their contributions to total return. Total returns may be quoted on a before-tax or after-tax basis. Total returns, yields, and other performance information may be quoted numerically or in a table, graph, or similar illustration. NET ASSET VALUE. Charts and graphs using the fund's net asset values, adjusted net asset values, and benchmark indices may be used to exhibit performance. An adjusted NAV includes any distributions paid by the fund and reflects all elements of its return. Unless otherwise indicated, the fund's adjusted NAVs are not adjusted for sales charges, if any. MOVING AVERAGES. The fund may illustrate performance using moving averages. A long-term moving average is the average of each week's adjusted closing NAV for a specified period. A short-term moving average is the average of each day's adjusted closing NAV for a specified period. Moving Average Activity Indicators combine adjusted closing NAVs from the last business day of each week with moving averages for a specified period to produce indicators showing when an NAV has crossed, stayed above, or stayed below its moving average. The fund may compare its total return to the record of the S&P 500, the Dow Jones Industrial Average (DJIA), and the cost of living, as measured by the Consumer Price Index (CPI), over the same period. The S&P 500 and DJIA comparisons would show how the fund's total return compared to the record of a broad unmanaged index of common stocks and a narrower set of stocks of major industrial companies, respectively. The fund has the ability to invest in securities not included in either index, and its investment portfolio may or may not be similar in composition to the indexes. The S&P 500 and DJIA returns are based on the prices of unmanaged groups of stocks and, unlike the fund's returns, do not include the effect of brokerage commissions or other costs of investing. PERFORMANCE COMPARISONS. The fund's performance may be compared to the performance of other mutual funds in general, or to the performance of particular types of mutual funds. These comparisons may be expressed as mutual fund rankings prepared by Lipper Analytical Services, Inc. (Lipper), an independent service located in Summit, New Jersey that monitors the performance of mutual funds. Generally, Lipper rankings are based on total return, assume reinvestment of distributions, do not take sales charges or trading fees into consideration, and are prepared without regard to tax consequences. In addition to the mutual fund rankings, the fund's performance may be compared to stock, bond, and money market mutual fund performance indices prepared by Lipper or other organizations. When comparing these indices, it is important to remember the risk and return characteristics of each type of investment. For example, while stock mutual funds may offer higher potential returns, they also carry the highest degree of share price volatility. Likewise, money market funds may offer greater stability of principal, but generally do not offer the higher potential returns available from stock mutual funds. From time to time, the fund's performance may also be compared to other mutual funds tracked by financial or business publications and periodicals. For example, the fund may quote Morningstar, Inc. in its advertising materials. Morningstar, Inc. is a mutual fund rating service that rates mutual funds on the basis of risk-adjusted performance. Rankings that compare the performance of Fidelity funds to one another in appropriate categories over specific periods of time may also be quoted in advertising. The fund's performance may also be compared to that of a benchmark index representing the universe of securities in which the fund may invest. The total return of a benchmark index reflects reinvestment of all dividends and capital gains paid by securities included in the index. Unlike the fund's returns, however, the index returns do not reflect brokerage commissions, transaction fees, or other costs of investing directly in the securities included in the index. The fund may compare its performance to that of the S&P 500, a widely recognized, unmanaged index of common stocks. The fund may be compared in advertising to Certificates of Deposit (CDs) or other investments issued by banks or other depository institutions. Mutual funds differ from bank investments in several respects. For example, the fund may offer greater liquidity or higher potential returns than CDs, the fund does not guarantee your principal or your return, and fund shares are not FDIC insured. Fidelity may provide information designed to help individuals understand their investment goals and explore various financial strategies. Such information may include information about current economic, market, and political conditions; materials that describe general principles of investing, such as asset allocation, diversification, risk tolerance, and goal setting; questionnaires designed to help create a personal financial profile; worksheets used to project savings needs based on assumed rates of inflation and hypothetical rates of return; and action plans offering investment alternatives. Materials may also include discussions of Fidelity's asset allocation funds and other Fidelity funds, products, and services. Ibbotson Associates of Chicago, Illinois (Ibbotson) provides historical returns of the capital markets in the United States, including common stocks, small capitalization stocks, long-term corporate bonds, intermediate-term government bonds, long-term government bonds, Treasury bills, the U.S. rate of inflation (based on the CPI), and combinations of various capital markets. The performance of these capital markets is based on the returns of different indices. Fidelity funds may use the performance of these capital markets in order to demonstrate general risk-versus-reward investment scenarios. Performance comparisons may also include the value of a hypothetical investment in any of these capital markets. The risks associated with the security types in any capital market may or may not correspond directly to those of the funds. Ibbotson calculates total returns in the same method as the funds. The funds may also compare performance to that of other compilations or indices that may be developed and made available in the future. In advertising materials, Fidelity may reference or discuss its products and services, which may include other Fidelity funds; retirement investing; brokerage products and services; model portfolios or allocations; saving for college or other goals; and charitable giving. In addition, Fidelity may quote or reprint financial or business publications and periodicals as they relate to current economic and political conditions, fund management, portfolio composition, investment philosophy, investment techniques, the desirability of owning a particular mutual fund, and Fidelity services and products. Fidelity may also reprint, and use as advertising and sales literature, articles from Fidelity Focus(Registered trademark), a quarterly magazine provided free of charge to Fidelity fund shareholders. The fund may present its fund number, Quotron(trademark) number, and CUSIP number, and discuss or quote its current portfolio manager. VOLATILITY. The fund may quote various measures of volatility and benchmark correlation in advertising. In addition, the fund may compare these measures to those of other funds. Measures of volatility seek to compare the fund's historical share price fluctuations or total returns to those of a benchmark. Measures of benchmark correlation indicate how valid a comparative benchmark may be. All measures of volatility and correlation are calculated using averages of historical data. In advertising, the fund may also discuss or illustrate examples of interest rate sensitivity. MOMENTUM INDICATORS indicate the fund's price movements over specific periods of time. Each point on the momentum indicator represents the fund's percentage change in price movements over that period. The fund may advertise examples of the effects of periodic investment plans, including the principle of dollar cost averaging. In such a program, an investor invests a fixed dollar amount in a fund at periodic intervals, thereby purchasing fewer shares when prices are high and more shares when prices are low. While such a strategy does not assure a profit or guard against loss in a declining market, the investor's average cost per share can be lower than if fixed numbers of shares are purchased at the same intervals. In evaluating such a plan, investors should consider their ability to continue purchasing shares during periods of low price levels. The fund may be available for purchase through retirement plans or other programs offering deferral of, or exemption from, income taxes, which may produce superior after-tax returns over time. For example, a $1,000 investment earning a taxable return of 10% annually would have an after-tax value of $1,949 after ten years, assuming tax was deducted from the return each year at a 31% rate. An equivalent tax-deferred investment would have an after-tax value of $2,100 after ten years, assuming tax was deducted at a 31% rate from the tax-deferred earnings at the end of the ten-year period. As of January 31,1998 , FMR advised over $ 31 billion in tax-free fund assets, $ 102 billion in money market fund assets, $ 398 billion in equity fund assets, $ 69 billion in international fund assets, and $ 27 billion in Spartan fund assets. The fund may reference the growth and variety of money market mutual funds and the adviser's innovation and participation in the industry. The equity funds under management figure represents the largest amount of equity fund assets under management by a mutual fund investment adviser in the United States, making FMR America's leading equity (stock) fund manager. FMR, its subsidiaries, and affiliates maintain a worldwide information and communications network for the purpose of researching and managing investments abroad. ADDITIONAL PURCHASE, EXCHANGE AND REDEMPTION INFORMATION The fund is open for business and its net asset value per share (NAV) is calculated each day the New York Stock Exchange (NYSE) is open for trading. The NYSE has designated the following holiday closings for 1998: New Year's Day, Martin Luther King's Birthday, Presidents' Day, Good Friday, Memorial Day, Independence Day(observed), Labor Day, Thanksgiving Day, and Christmas Day. Although FMR expects the same holiday schedule to be observed in the future, the NYSE may modify its holiday schedule at any time. In addition, on days when the Federal Reserve Wire System is closed , federal funds wires cannot be sent. FSC normally determines the fund's NAV as of the close of the NYSE (normally 4:00 p.m. Eastern time). However, NAV may be calculated earlier if trading on the NYSE is restricted or as permitted by the SEC. To the extent that portfolio securities are traded in other markets on days when the NYSE is closed, the fund's NAV may be affected on days when investors do not have access to the fund to purchase or redeem shares. In addition, trading in some of a fund's portfolio securities may not occur on days when the fund is open for business. If the Trustees determine that existing conditions make cash payments undesirable, redemption payments may be made in whole or in part in securities or other property, valued for this purpose as they are valued in computing the fund's NAV. Shareholders receiving securities or other property on redemption may realize a gain or loss for tax purposes, and will incur any costs of sale, as well as the associated inconveniences. Pursuant to Rule 11a-3 under the 1940 Act, the fund is required to give shareholders at least 60 days' notice prior to terminating or modifying its exchange privilege. Under the Rule, the 60-day notification requirement may be waived if (i) the only effect of a modification would be to reduce or eliminate an administrative fee, redemption fee, or deferred sales charge ordinarily payable at the time of an exchange, or (ii) the fund suspends the redemption of the shares to be exchanged as permitted under the 1940 Act or the rules and regulations thereunder, or the fund to be acquired suspends the sale of its shares because it is unable to invest amounts effectively in accordance with its investment objective and policies. In the Prospectus, the fund has notified shareholders that it reserves the right at any time, without prior notice, to refuse exchange purchases by any person or group if, in FMR's judgment, the fund would be unable to invest effectively in accordance with its investment objective and policies, or would otherwise potentially be adversely affected. DISTRIBUTIONS AND TAXES DISTRIBUTIONS. If you request to have distributions mailed to you and the U.S. Postal Service cannot deliver your checks, or if your checks remain uncashed for six months, Fidelity may reinvest your distributions at the then-current NAV. All subsequent distributions will then be reinvested until you provide Fidelity with alternate instructions. DIVIDENDS. A portion of the fund's income may qualify for the dividends-received deduction available to corporate shareholders to the extent that the fund's income is derived from qualifying dividends. Because the fund may earn other types of income, such as interest, income from securities loans, non-qualifying dividends, and short-term capital gains, the percentage of dividends from the fund that qualifies for the deduction generally will be less than 100%. The fund will notify corporate shareholders annually of the percentage of fund dividends that qualifies for the dividends-received deduction. A portion of the fund's dividends derived from certain U.S. Government obligations may be exempt from state and local taxation. Gains (losses) attributable to foreign currency fluctuations are generally taxable as ordinary income, and therefore will increase (decrease) dividend distributions. If the fund's distributions exceed its net investment company taxable income during a taxable year, all or a portion of the distributions made in the same taxable year would be recharacterized as a return of capital to shareholders, thereby reducing each shareholder's cost basis in the fund. Short-term capital gains are distributed as dividend income. The fund will send each shareholder a notice in January describing the tax status of dividends and capital gain distributions for the prior year. CAPITAL GAIN DISTRIBUTIONS. Long-term capital gains earned by the fund on the sale of securities and distributed to shareholders are federally taxable as long-term capital gains, regardless of the length of time shareholders have held their shares. If a shareholder receives a capital gain distribution on shares of the fund, and such shares are held six months or less and are sold at a loss, the portion of the loss equal to the amount of the capital gain distribution will be considered a long-term loss for tax purposes. Short-term capital gains distributed by the fund are taxable to shareholders as dividends, not as capital gains. FOREIGN TAXES. Foreign governments may withhold taxes on dividends and interest paid with respect to foreign securities. Foreign governments may also impose taxes on other payments or gains with respect to foreign securities. Because the fund does not currently anticipate that securities of foreign issuers will constitute more than 50% of its total assets at the end of its fiscal year, shareholders should not expect to claim a foreign tax credit or deduction on their federal income tax returns with respect to foreign taxes withheld. TAX STATUS OF THE FUND. The fund intends to qualify each year as a "regulated investment company" for tax purposes so that it will not be liable for federal tax on income and capital gains distributed to shareholders. In order to qualify as a regulated investment company and avoid being subject to federal income or excise taxes at the fund level, the fund intends to distribute substantially all of its net investment income and net realized capital gains within each calendar year as well as on a fiscal year basis, and intends to comply with other tax rules applicable to regulated investment companies. The fund is treated as a separate entity from the other funds of Fidelity Hastings Street Trust for tax purposes. OTHER TAX INFORMATION. The information above is only a summary of some of the tax consequences generally affecting the fund and its shareholders, and no attempt has been made to discuss individual tax consequences. In addition to federal income taxes, shareholders may be subject to state and local taxes on fund distributions, and shares may be subject to state and local personal property taxes. Investors should consult their tax advisers to determine whether a fund is suitable to their particular tax situation. FMR All of the stock of FMR is owned by FMR Corp., its parent organized in 1972. The voting common stock of FMR Corp. is divided into two classes. Class B is held predominantly by members of the Edward C. Johnson 3d family and is entitled to 49% of the vote on any matter acted upon by the voting common stock. Class A is held predominantly by non-Johnson family member employees of FMR Corp. and its affiliates and is entitled to 51% of the vote on any such matter. The Johnson family group and all other Class B shareholders have entered into a shareholders' voting agreement under which all Class B shares will be voted in accordance with the majority vote of Class B shares. Under the 1940 Act, control of a company is presumed where one individual or group of individuals owns more than 25% of the voting stock of that company. Therefore, through their ownership of voting common stock and the execution of the shareholders' voting agreement, members of the Johnson family may be deemed, under the 1940 Act, to form a controlling group with respect to FMR Corp. At present, the principal operating activities of FMR Corp. are those conducted by its division, Fidelity Investments Retail Marketing Company, which provides marketing services to various companies within the Fidelity organization. Fidelity investment personnel may invest in securities for their own accounts pursuant to a code of ethics that sets forth all employees' fiduciary responsibilities regarding the funds, establishes procedures for personal investing and restricts certain transactions. For example, all personal trades in most securities require pre-clearance, and participation in initial public offerings is prohibited. In addition, restrictions on the timing of personal investing in relation to trades by Fidelity funds and on short-term trading have been adopted. TRUSTEES AND OFFICERS The Trustees, Members of the Advisory Board, and executive officers of the trust are listed below. Except as indicated, each individual has held the office shown or other offices in the same company for the last five years. All persons named as Trustees and Members of the Advisory Board also serve in similar capacities for other funds advised by FMR. The business address of each Trustee, Member of the Advisory Board, and officer who is an "interested person" (as defined in the Investment Company Act of 1940) is 82 Devonshire Street, Boston, Massachusetts 02109, which is also the address of FMR. The business address of all the other Trustees is Fidelity Investments, P.O. Box 9235, Boston, Massachusetts 02205-9235. Those Trustees who are "interested persons" by virtue of their affiliation with either the trust or FMR are indicated by an asterisk (*). *EDWARD C. JOHNSON 3d (67 ), Trustee and President, is Chairman, Chief Executive Officer and a Director of FMR Corp.; a Director and Chairman of the Board and of the Executive Committee of FMR; Chairman and a Director of Fidelity Investments Money Management, Inc. (1998), Fidelity Management & Research (U.K.) Inc., and Fidelity Management & Research (Far East) Inc. J. GARY BURKHEAD ( 56 ), Member of the Advisory Board (1997), is Vice Chairman and a Member of the Board of Directors of FMR Corp. (1997) and President of Fidelity Personal Investments and Brokerage Group (1997). Previously, Mr. Burkhead served as President of Fidelity Management & Research Company. RALPH F. COX ( 65 ), Trustee, is President of RABAR Enterprises (management consulting-engineering industry, 1994). Prior to February 1994, he was President of Greenhill Petroleum Corporation (petroleum exploration and production). Until March 1990, Mr. Cox was President and Chief Operating Officer of Union Pacific Resources Company (exploration and production). He is a Director of USA Waste Services, Inc. (non-hazardous waste, 1993), CH2M Hill Companies (engineering), Rio Grande, Inc. (oil and gas production), and Daniel Industries (petroleum measurement equipment manufacturer). In addition, he is a member of advisory boards of Texas A&M University and the University of Texas at Austin. PHYLLIS BURKE DAVIS ( 66 ), Trustee. Prior to her retirement in September 1991, Mrs. Davis was the Senior Vice President of Corporate Affairs of Avon Products, Inc. She is currently a Director of BellSouth Corporation (telecommunications), Eaton Corporation (manufacturing, 1991), and the TJX Companies, Inc. (retail stores), and previously served as a Director of Hallmark Cards, Inc. (1985-1991) and Nabisco Brands, Inc. In addition, she is a member of the President's Advisory Council of The University of Vermont School of Business Administration. ROBERT M. GATES ( 54 ), Trustee (1997), is a consultant, author, and lecturer (1993). Mr. Gates was Director of the Central Intelligence Agency (CIA) from 1991-1993. From 1989 to 1991, Mr. Gates served as Assistant to the President of the United States and Deputy National Security Advisor. Mr. Gates is a Director of Lucas Varity PLC (automotive components and diesel engines), Charles Stark Draper Laboratory (non-profit), NACCO Industries, Inc. (mining and manufacturing), and TRW Inc. (original equipment and replacement products). Mr. Gates also is a Trustee of the Forum for International Policy and of the Endowment Association of the College of William and Mary. In addition, he is a member of the National Executive Board of the Boy Scouts of America. E. BRADLEY JONES ( 70 ), Trustee. Prior to his retirement in 1984, Mr. Jones was Chairman and Chief Executive Officer of LTV Steel Company. He is a Director of TRW Inc. (original equipment and replacement products), Consolidated Rail Corporation, Birmingham Steel Corporation, and RPM, Inc. (manufacturer of chemical products), and he previously served as a Director of NACCO Industries, Inc. (mining and manufacturing, 1985-1995), Hyster-Yale Materials Handling, Inc. (1985-1995), and Cleveland-Cliffs Inc (mining), and as a Trustee of First Union Real Estate Investments. In addition, he serves as a Trustee of the Cleveland Clinic Foundation, where he has also been a member of the Executive Committee as well as Chairman of the Board and President, a Trustee and member of the Executive Committee of University School (Cleveland), and a Trustee of Cleveland Clinic Florida. DONALD J. KIRK ( 65 ), Trustee, is Executive-in-Residence (1995) at Columbia University Graduate School of Business and a financial consultant. From 1987 to January 1995, Mr. Kirk was a Professor at Columbia University Graduate School of Business. Prior to 1987, he was Chairman of the Financial Accounting Standards Board. Mr. Kirk is a Director of General Re Corporation (reinsurance), and he previously served as a Director of Valuation Research Corp. (appraisals and valuations, 1993-1995). In addition, he serves as Chairman of the Board of Directors of the National Arts Stabilization Fund, Chairman of the Board of Trustees of the Greenwich Hospital Association, a Member of the Public Oversight Board of the American Institute of Certified Public Accountants' SEC Practice Section (1995), and as a Public Governor of the National Association of Securities Dealers, Inc. (1996). *PETER S. LYNCH ( 55 ), Trustee, is Vice Chairman and Director of FMR. Prior to May 31, 1990, he was a Director of FMR and Executive Vice President of FMR (a position he held until March 31, 1991); Vice President of Fidelity Magellan Fund and FMR Growth Group Leader; and Managing Director of FMR Corp. Mr. Lynch was also Vice President of Fidelity Investments Corporate Services (1991-1992). In addition, he serves as a Trustee of Boston College, Massachusetts Eye & Ear Infirmary, Historic Deerfield (1989) and Society for the Preservation of New England Antiquities, and as an Overseer of the Museum of Fine Arts of Boston. WILLIAM O. McCOY (64 ), Trustee (1997), is the Vice President of Finance for the University of North Carolina (16-school system, 1995). Prior to his retirement in December 1994, Mr. McCoy was Vice Chairman of the Board of BellSouth Corporation (telecommunications, 1984) and President of BellSouth Enterprises (1986). He is currently a Director of Liberty Corporation (holding company, 1984), Weeks Corporation of Atlanta (real estate, 1994), Carolina Power and Light Company (electric utility, 1996), and the Kenan Transport Co. (1996). Previously, he was a Director of First American Corporation (bank holding company, 1979-1996). In addition, Mr. McCoy serves as a member of the Board of Visitors for the University of North Carolina at Chapel Hill (1994) and for the Kenan-Flager Business School (University of North Carolina at Chapel Hill, 1988). GERALD C. McDONOUGH ( 68 ), Trustee and Chairman of the non-interested Trustees, is Chairman of G.M. Management Group (strategic advisory services). Mr. McDonough is a Director of York International Corp. (air conditioning and refrigeration), Commercial Intertech Corp. (hydraulic systems, building systems, and metal products, 1992), CUNO, Inc. (liquid and gas filtration products, 1996), and Associated Estates Realty Corporation (a real estate investment trust, 1993). Mr. McDonough served as a Director of ACME-Cleveland Corp. (metal working, telecommunications, and electronic products) from 1987-1996 and Brush-Wellman Inc. (metal refining) from 1983-1997. MARVIN L. MANN ( 64 ), Trustee (1993 ), is Chairman of the Board, President, and Chief Executive Officer of Lexmark International, Inc. (office machines, 1991). Prior to 1991, he held the positions of Vice President of International Business Machines Corporation ("IBM") and President and General Manager of various IBM divisions and subsidiaries. Mr. Mann is a Director of M.A. Hanna Company (chemicals, 1993), Imation Corp. (imaging and information storage, 1997), and Infomart (marketing services, 1991), a Trammell Crow Co. In addition, he serves as the Campaign Vice Chairman of the Tri-State United Way (1993) and is a member of the University of Alabama President's Cabinet. *ROBERT C. POZEN ( 51 ), Trustee (1997) and Senior Vice President, is also President and a Director of FMR (1997); and President and a Director of Fidelity Investments Money Management, Inc. (199 8) , Fidelity Management & Research (U.K.) Inc. (1997), and Fidelity Management & Research (Far East) Inc. (1997). Previously, Mr. Pozen served as General Counsel, Managing Director, and Senior Vice President of FMR Corp. THOMAS R. WILLIAMS ( 69 ), Trustee, is President of The Wales Group, Inc. (management and financial advisory services). Prior to retiring in 1987, Mr. Williams served as Chairman of the Board of First Wachovia Corporation (bank holding company), and Chairman and Chief Executive Officer of The First National Bank of Atlanta and First Atlanta Corporation (bank holding company). He is currently a Director of ConAgra, Inc. (agricultural products), Georgia Power Company (electric utility), National Life Insurance Company of Vermont, American Software, Inc., and AppleSouth, Inc. (restaurants, 1992). ROBERT A. LAWRENCE ( 45 ), is Vice President of certain Equity Funds (1997), Vice President of Fidelity Real Estate High Income Fund (1995) and Fidelity Real Estate High Income Fund II (1996), and Senior Vice President of FMR (1993). RICHARD A. SPILLANE, JR. ( 46 ), is Vice President of certain Equity Funds and Senior Vice President of FMR (1997). Since joining Fidelity, Mr. Spillane is Chief Investment Officer for Fidelity International, Limited. Prior to that position, Mr. Spillane served as Director of Research. ERIC D. ROITER ( 49 ), Secretary (1998), is Vice President (1998) and General Counsel of FMR (1998). Mr. Roiter was an Adjunct Member, Faculty of Law, at Columbia University Law School (1996-1997). Prior to joining Fidelity, Mr. Roiter was a partner at Debevoise & Plimpton (1981-1997) and served as an Assistant General Counsel of the U.S. Securities and Exchange Commission (1979-1981). RICHARD A. SILVER ( 51 ), Treasurer (1997), is Treasurer of the Fidelity funds and is an employee of FMR (1997). Before joining FMR, Mr. Silver served as Executive Vice President, Fund Accounting & Administration at First Data Investor Services Group, Inc. (1996-1997). Prior to 1996, Mr. Silver was Senior Vice President and Chief Financial Officer at The Colonial Group, Inc. Mr. Silver also served as Chairman of the Accounting/Treasurer's Committee of the Investment Company Institute (1987-1993). JOHN H. COSTELLO ( 51 ), Assistant Treasurer, is an employee of FMR. LEONARD M. RUSH ( 51 ), Assistant Treasurer (1994), is an employee of FMR (1994). Prior to becoming Assistant Treasurer of the Fidelity funds, Mr. Rush was Chief Compliance Officer of FMR Corp. (1993-1994) and Chief Financial Officer of Fidelity Brokerage Services, Inc. (1990-1993). The following table sets forth information describing the compensation of each Trustee and Member of the Advisory Board of the fund for his or her services for the fiscal year end ed June 30, 199 8 , or calendar year ended December 31, 1997, as applicable. COMPENSATION TABLE Trustees Aggregate Total and Compensation Compensation Members of the Advisory Board from from the Income & GrowthB,+ Fund Complex*A J. Gary Burkhead** $ 0 $ 0 Ralph F. Cox $ 19 $ 214,500 Phyllis Burke Davis $ 18 $ 210,000 Robert M. Gates*** $ 15 $ 176,000 Edward C. Johnson 3d** $ 0 $ 0 E. Bradley Jones $ 18 $ 211,500 Donald J. Kirk $ 18 $ 211,500 Peter S. Lynch** $ 0 $ 0 William O. McCoy**** $ 19 $ 214,500 Gerald C. McDonough $ 23 $ 264,500 Marvin L. Mann $ 19 $ 214,500 Robert C. Pozen** $ 0 $ 0 Thomas R. Williams $ 19 $ 214,500 * Information is for the calendar year ended December 31, 1997 for 230 funds in the complex. ** Interested Trustees of the fund and Mr. Burkhead are compensated by FMR. *** Mr. Gates was elected to the Board of Trustees on July 16, 1997. **** Mr. McCoy was elected to the Board of Trustees on July 16, 1997. + Figures presented are estimated for the fund's first fiscal year ending June 30, 1998 . A Compensation figures include cash, amounts required to be deferred, and may include amounts deferred at the election of Trustees. For the calendar year ended December 31, 1997, the Trustees accrued required deferred compensation from the funds as follows: Ralph F. Cox, $75,000, Phyllis Burke Davis, $75,000, Robert M. Gates, $62,500, E. Bradley Jones, $75,000, Donald J. Kirk, $75,000, William O. McCoy, $75,000, Gerald C. McDonough, $87,500, Marvin L. Mann, $75,000, and Thomas R. Williams, $75,000. Certain of the non-interested Trustees elected voluntarily to defer a portion of their compensation: Ralph F. Cox, $53,699, Marvin L. Mann, $53,699, and Thomas R. Williams, $62,462. B Compensation figures include cash. Under a deferred compensation plan adopted in September 1995 and amended in November 1996 (the Plan), non-interested Trustees must defer receipt of a portion of, and may elect to defer receipt of an additional portion of , their annual fees. Amounts deferred under the Plan are subject to vesting and are treated as though equivalent dollar amounts had been invested in shares of a cross-section of Fidelity funds including funds in each major investment discipline and representing a majority of Fidelity's assets under management (the Reference Funds). The amounts ultimately received by the Trustees under the Plan will be directly linked to the investment performance of the Reference Funds. Deferral of fees in accordance with the Plan will have a negligible effect on a fund's assets, liabilities, and net income per share, and will not obligate a fund to retain the services of any Trustee or to pay any particular level of compensation to the Trustee. A fund may invest in the Reference Funds under the Plan without shareholder approval. As of the public offering of shares of the fund , 100% of the fund's total outstanding shares was held by FMR and an FMR affiliate(s). FMR Corp. is the ultimate parent company of FMR and the FMR affiliate(s) . By virtue of his ownership interest in FMR Corp., as described in the "FMR" section on page , Mr. Edward C. Johnson 3d, President and Trustee of the fund, may be deemed to be a beneficial owner of these shares. MANAGEMENT CONTRACT FMR is the fund's manager pursuant to a management contract dated March 19, 1998 . MANAGEMENT SERVICES. The fund employs FMR to furnish investment advisory and other services. Under the terms of its management contract with the fund, FMR acts as investment adviser and, subject to the supervision of the Board of Trustees, directs the investments of the fund in accordance with its investment objective, policies, and limitations. FMR also provides the fund with all necessary office facilities and personnel for servicing the fund's investments, compensates all officers of the fund and all Trustees who are "interested persons" of the trust or of FMR, and all personnel of the fund or FMR performing services relating to research, statistical, and investment activities. In addition, FMR or its affiliates, subject to the supervision of the Board of Trustees, provide the management and administrative services necessary for the operation of the fund. These services include providing facilities for maintaining the fund's organization; supervising relations with custodians, transfer and pricing agents, accountants, underwriters, and other persons dealing with the fund; preparing all general shareholder communications and conducting shareholder relations; maintaining the fund's records and the registration of the fund's shares under federal securities laws and making necessary filings under state securities laws; developing management and shareholder services for the fund; and furnishing reports, evaluations, and analyses on a variety of subjects to the Trustees. MANAGEMENT-RELATED EXPENSES. In addition to the management fee payable to FMR and the fees payable to the transfer, dividend disbursing, and shareholder servicing agent, pricing and bookkeeping agent, and securities lending agent, the fund pays all of its expenses that are not assumed by those parties. The fund pays for the typesetting, printing, and mailing of its proxy materials to shareholders, legal expenses, and the fees of the custodian, auditor and non-interested Trustees. The fund's management contract further provides that the fund will pay for typesetting, printing, and mailing prospectuses, statements of additional information, notices, and reports to shareholders; however, under the terms of the fund's transfer agent agreement, the transfer agent bears the costs of providing these services to existing shareholders. Other expenses paid by the fund include interest, taxes, brokerage commissions, the fund's proportionate share of insurance premiums and Investment Company Institute dues, and the costs of registering shares under federal securities laws and making necessary filings under state securities laws. The fund is also liable for such non-recurring expenses as may arise, including costs of any litigation to which the fund may be a party, and any obligation it may have to indemnify its officers and Trustees with respect to litigation. MANAGEMENT FEE. For the services of FMR under the management contract, the fund pays FMR a monthly management fee which has two components: a group fee rate and an individual fund fee rate. The group fee rate is based on the monthly average net assets of all of the registered investment companies with which FMR has management contracts. GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES Average Group Annualized Group Net Effective Annual Fee Assets Rate Assets Rate 0 - $3 billion .5200% $ 0.5 billion .5200% 3 - 6 .4900 25 .4238 6 - 9 .4600 50 .3823 9 - 12 .4300 75 .3626 12 - 15 .4000 100 .3512 15 - 18 .3850 125 .3430 18 - 21 .3700 150 .3371 21 - 24 .3600 175 .3325 24 - 30 .3500 200 .3284 30 - 36 .3450 225 .3249 36 - 42 .3400 250 .3219 42 - 48 .3350 275 .3190 48 - 66 .3250 300 .3163 66 - 84 .3200 325 .3137 84 - 102 .3150 350 .3113 102 - 138 .3100 375 .3090 138 - 174 .3050 400 .3067 174 - 210 .3000 425 .3046 210 - 246 .2950 450 .3024 246 - 282 .2900 475 .3003 282 - 318 .2850 500 .2982 318 - 354 .2800 525 .2962 354 - 390 .2750 550 .2942 390 - 426 .2700 426 - 462 .2650 462 - 498 .2600 498 - 534 .2550 Over 534 .2500 The group fee rate is calculated on a cumulative basis pursuant to the graduated fee rate schedule shown above on the left. The schedule above on the right shows the effective annual group fee rate at various asset levels, which is the result of cumulatively applying the annualized rates on the left. For example, the effective annual fee rate at $ 555 billion of group net assets - the approximate level for January 1998 - was 0.2937 %, which is the weighted average of the respective fee rates for each level of group net assets up to $ 555 billion. The fund's individual fund fee rate is 0.20%. Based on the average group net assets of the funds advised by FMR for January 1998 , the fund's annual management fee rate would have been calculated as follows:
Group Fee Rate Individual Fund Fee Rate Management Fee Rate Income & Growth 0. 2937 % + 0.20% = 0. 4937 %
One-twelfth of this annual management fee rate is applied to the fund's net assets averaged for the most recent month, giving a dollar amount, which is the fee for that month. FMR may, from time to time, voluntarily reimburse all or a portion of the fund's expenses (exclusive of interest, taxes, brokerage commissions, and extraordinary expenses). FMR retains the ability to be repaid for these expense reimbursements in the amount that expenses fall below the limit prior to the end of the fiscal year. Expense reimbursements by FMR will increase the fund's total returns and yield, and repayment of the reimbursement by the fund will lower its total returns and yield. SUB-ADVISERS. On behalf of Fidelity Income & Growth Fund, FMR has entered into sub-advisory agreements with FMR U.K. and FMR Far East. Pursuant to the sub-advisory agreements, FMR may receive investment advice and research services outside the United States from the sub-advisers. On behalf of the fund, FMR may also grant FMR U.K and FMR Far East investment management authority as well as the authority to buy and sell securities if FMR believes it would be beneficial to the fund. Currently, FMR U.K. and FMR Far East each focus on issuers in countries other than the United States such as those in Europe, Asia, and the Pacific Basin. FMR U.K. and FMR Far East, which were organized in 1986, are wholly owned subsidiaries of FMR. Under the sub-advisory agreements FMR pays the fees of FMR U.K. and FMR Far East. For providing non-discretionary investment advice and research services, FMR pays FMR U.K. and FMR Far East fees equal to 110% and 105%, respectively, of FMR U.K.'s and FMR Far East's costs incurred in connection with providing investment advice and research services. On behalf of the fund, for providing discretionary investment management and executing portfolio transactions, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its monthly management fee rate with respect to the fund's average net assets managed by the sub-adviser on a discretionary basis. DISTRIBUTION AND SERVICE PLAN The Trustees have approved a Distribution and Service Plan on behalf of the fund pursuant to Rule 12b-1 under the 1940 Act (the Rule). The Rule provides in substance that a mutual fund may not engage directly or indirectly in financing any activity that is primarily intended to result in the sale of shares of the fund except pursuant to a plan approved on behalf of the fund under the Rule. The Plan, as approved by the Trustees, allows the fund and FMR to incur certain expenses that might be considered to constitute indirect payment by the fund of distribution expenses. Under the Plan, if the payment of management fees by the fund to FMR is deemed to be indirect financing by the fund of the distribution of its shares, such payment is authorized by the Plan. The Plan specifically recognizes that FMR may use its management fee revenue, as well as its past profits or its other resources, to pay FDC for expenses incurred in connection with the distribution of fund shares. In addition, the Plan provides that FMR, directly or through FDC, may make payments to third parties, such as banks or broker-dealers, that engage in the sale of fund shares, or provide shareholder support services. Currently, the Board of Trustees has authorized such payments for Fidelity Income & Growth shares. Prior to approving the Plan, the Trustees carefully considered all pertinent factors relating to the implementation of the Plan, and determined that there is a reasonable likelihood that the Plan will benefit the fund and its shareholders. In particular, the Trustees noted that the Plan does not authorize payments by the fund other than those made to FMR under its management contract with the fund. To the extent that the Plan gives FMR and FDC greater flexibility in connection with the distribution of fund shares, additional sales of fund shares may result. Furthermore, certain shareholder support services may be provided more effectively under the Plan by local entities with whom shareholders have other relationships. The Glass-Steagall Act generally prohibits federally and state chartered or supervised banks from engaging in the business of underwriting, selling, or distributing securities. Although the scope of this prohibition under the Glass-Steagall Act has not been clearly defined by the courts or appropriate regulatory agencies, FDC believes that the Glass-Steagall Act should not preclude a bank from performing shareholder support services, or servicing and recordkeeping functions. FDC intends to engage banks only to perform such functions. However, changes in federal or state statutes and regulations pertaining to the permissible activities of banks and their affiliates or subsidiaries, as well as further judicial or administrative decisions or interpretations, could prevent a bank from continuing to perform all or a part of the contemplated services. If a bank were prohibited from so acting, the Trustees would consider what actions, if any, would be necessary to continue to provide efficient and effective shareholder services. In such event, changes in the operation of the fund might occur, including possible termination of any automatic investment or redemption or other services then provided by the bank. It is not expected that shareholders would suffer any adverse financial consequences as a result of any of these occurrences. In addition, state securities laws on this issue may differ from the interpretations of federal law expressed herein, and banks and other financial institutions may be required to register as dealers pursuant to state law. The fund may execute portfolio transactions with, and purchase securities issued by, depository institutions that receive payments under the Plan. No preference for the instruments of such depository institutions will be shown in the selection of investments. CONTRACTS WITH FMR AFFILIATES The fund has entered into a transfer agent agreement with FSC, an affiliate of FMR. Under the terms of the agreement, FSC performs transfer agency, dividend disbursing, and shareholder services for the fund. For providing transfer agency services, FSC receives an account fee and an asset-based fee each paid monthly with respect to each account in a fund. For retail accounts and certain institutional accounts, these fees are based on account size and fund type. For certain institutional retirement accounts, these fees are based on fund type. For certain other institutional retirement accounts, these fees are based on account type (i.e., omnibus or non-omnibus) and, for non-omnibus accounts, fund type. The account fees are subject to increase based on posta ge rate changes. The asset-based fees are subject to adjustment if the year-to-date total return of the S&P 500 exceeds a positive or negative 15%. FSC also collects small account fees from certain accounts with balances of less than $2,500. In addition, FSC receives the pro rata portion of the transfer agency fees applicable to shareholder accounts in each Fidelity Freedom Fund, a fund of funds managed by an FMR affiliate, according to the percentage of the Freedom Fund's assets that is invested in the fund. 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 existing shareholders, with the exception of proxy statements. The fund has also entered into a service agent agreement with FSC. Under the terms of the agreement, FSC calculates the NAV and dividends for the fund, maintains the fund's portfolio and general accounting records, and administers the fund's securities lending program. For providing pricing and bookkeeping services, FSC receives a monthly fee based on the fund's average daily net assets throughout the month. The annual fee rates for pricing and bookkeeping services are 0.0600% of the first $500 million of average net assets and 0.0300% of average net assets in excess of $500 million. The fee, not including reimbursement for out-of-pocket expenses, is limited to a minimum of $60,000 and a maximum of $800,000 per year. For administering the fund's securities lending program, FSC receives fees based on the number and duration of individual securities loans. The fund has entered into a distribution agreement with FDC, an affiliate of FMR organized as a Massachusetts corporation on July 18, 1960. FDC is a broker-dealer registered under the Securities Exchange Act of 1934 and a member of the National Association of Securities Dealers, Inc. The distribution agreement calls for FDC to use all reasonable efforts, consistent with its other business, to secure purchasers for shares of the fund, which are continuously offered at NAV. Promotional and administrative expenses in connection with the offer and sale of shares are paid by FMR. DESCRIPTION OF THE TRUST TRUST ORGANIZATION. Fidelity Income & Growth Fund is a fund of Fidelity Hastings Street Trust, an open-end management investment company originally organized under the name Fidelity Fund as a Massachusetts corporation on May 1, 1930, and recognized as a Massachusetts business trust on December 31, 1984. The trust's name was changed to Fidelity Hastings Street Trust on April 30, 1993. Currently, there are four funds of the trust: Fidelity Income & Growth Fund, Fidelity Fund, Fidelity Fifty, and Fidelity Value Portfolio. The Declaration of Trust permits the Trustees to create additional funds. In the event that FMR ceases to be the investment adviser to the trust or a fund, the right of the trust or fund to use the identifying name "Fidelity" may be withdrawn. The assets of the trust received for the issue or sale of shares of each fund and all income, earnings, profits, and proceeds thereof, subject only to the rights of creditors, are especially allocated to such fund, and constitute the underlying assets of such fund. The underlying assets of each fund are segregated on the books of account, and are to be charged with the liabilities with respect to such fund and with a share of the general expenses of the trust. Expenses with respect to the trust are to be allocated in proportion to the asset value of the respective funds, except where allocations of direct expense can otherwise be fairly made. The officers of the trust, subject to the general supervision of the Board of Trustees, have the power to determine which expenses are allocable to a given fund, or which are general or allocable to all of the funds. In the event of the dissolution or liquidation of the trust, shareholders of each fund are entitled to receive as a class the underlying assets of such fund available for distribution. SHAREHOLDER AND TRUSTEE LIABILITY. The trust is an entity of the type commonly known as a "Massachusetts business trust." Under Massachusetts law, shareholders of such a trust may, under certain circumstances, be held personally liable for the obligations of the trust. The Declaration of Trust provides that the trust shall not have any claim against shareholders except for the payment of the purchase price of shares and requires that each agreement, obligation, or instrument entered into or executed by the trust or the Trustees include a provision limiting the obligations created thereby to the trust and its assets. The Declaration of Trust provides for indemnification out of each fund's property of any shareholder held personally liable for the obligations of the fund. The Declaration of Trust also provides that each fund shall, upon request, assume the defense of any claim made against any shareholder for any act or obligation of the fund and satisfy any judgment thereon. Thus, the risk of a shareholder incurring financial loss on account of shareholder liability is limited to circumstances in which a fund itself would be unable to meet its obligations. FMR believes that, in view of the above, the risk of personal liability to shareholders is remote. The Declaration of Trust further provides that the Trustees, if they have exercised reasonable care, will not be liable for any neglect or wrongdoing, but nothing in the Declaration of Trust protects Trustees against any liability to which they would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the conduct of their office. VOTING RIGHTS. Each fund's capital consists of shares of beneficial interest. As a shareholder, you receive one vote for each dollar value of net asset value you own. The shares have no preemptive or conversion rights; the voting and dividend rights, the right of redemption, and the privilege of exchange are described in the Prospectus. Shares are fully paid and nonassessable, except as set forth under the heading "Shareholder and Trustee Liability" above. Shareholders representing 10% or more of the trust or a fund may, as set forth in the Declaration of Trust, call meetings of the trust or a fund for any purpose related to the trust or fund, as the case may be, including, in the case of a meeting of the entire trust, the purpose of voting on removal of one or more Trustees. The trust or any fund may be terminated upon the sale of its assets to another open-end management investment company, or upon liquidation and distribution of its assets, if approved by vote of the holders of a majority of the trust or the fund, as determined by the current value of each shareholder's investment in the fund or trust. If not so terminated, the trust and its funds will continue indefinitely. Each fund may invest all of its assets in another investment company. CUSTODIAN. The Chase Manhattan Bank, 1 Chase Manhattan Plaza, New York, New York , is custodian of the assets of the fund. The custodian is responsible for the safekeeping of a fund's assets and the appointment of any subcustodian banks and clearing agencies. The custodian takes no part in determining the investment policies of a fund or in deciding which securities are purchased or sold by a fund. However, a fund may invest in obligations of its custodian and may purchase securities from or sell securities to the custodian. The Chase Manhattan Bank , also may serve as a special purpose custodian of certain assets in connection with repurchase agreement transactions. FMR, its officers and directors, its affiliated companies, and the Board of Trustees may, from time to time, conduct transactions with various banks, including banks serving as custodians for certain funds advised by FMR. Transactions that have occurred to date include mortgages and personal and general business loans. In the judgment of FMR, the terms and conditions of those transactions were not influenced by existing or potential custodial or other fund relationships. AUDITOR. Coopers & Lybrand L.L.P., serves as the fund's independent accountant. The auditor examines financial statements for the fund and provides other audit, tax, and related services. APPENDIX DESCRIPTION OF MOODY'S INVESTORS SERVICE RATINGS OF CORPORATE BONDS Moody's ratings for obligations with an original remaining maturity in excess of one year fall within nine categories. They range from Aaa (highest quality) to C (lowest quality). Moody applies numerical modifiers of 1, 2, or 3 to each generic rating classification from Aa through B. The modifier 1 indicates that the security ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates that the issue ranks on the lower end of its generic rating category. AAA - Bonds that are rated Aaa are judged to be of the best quality. They carry the smallest degree of investment risk and are generally referred to as "gilt edged." Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues. AA - Bonds that are rated Aa are judged to be of high quality by all standards. Together with the Aaa group they comprise what are generally known as high-grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Aaa securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risks appear somewhat larger than the Aaa securities. A - Bonds that are rated A possess many favorable investment attributes and are to be considered as upper-medium-grade obligations. Factors giving security to principal and interest are considered adequate but elements may be present which suggest a susceptibility to impairment sometime in the future. BAA - Bonds that are rated Baa are considered as medium-grade obligations, (i.e., they are neither highly protected nor poorly secured). Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well. BA - Bonds that are rated Ba are judged to have speculative elements; their future cannot be considered as well assured. Often the protection of interest and principal payments may be very moderate and thereby not well safeguarded during both good and bad times over the future. Uncertainty of position characterizes bonds in this class. B - Bonds that are rated B generally lack characteristics of the desirable investment. Assurance of interest and principal payments or of maintenance of other terms of the contract over any long period of time may be small. CAA - Bonds that are rated Caa are of poor standing. Such issues may be in default or there may be present elements of danger with respect to principal or interest. CA - Bonds that are rated Ca represent obligations which are speculative in a high degree. Such issues are often in default or have other marked short-comings. C - Bonds that are rated C are the lowest-rated class of bonds and issues so rated can be regarded as having extremely poor prospects of ever attaining any real investment standing. DESCRIPTION OF STANDARD & POOR'S RATINGS OF CORPORATE BONDS Debt issues may be designated by Standard & Poor's as either investment grade ("AAA" through "BBB") or speculative grade ("BB" through "D"). While speculative grade debt will likely have some quality and protective characteristics, these are outweighed by large uncertainties or major exposures to adverse conditions. Ratings from AA to CCC may be modified by the addition of a plus sign (+) or minus sign (-) to show relative standing within the major rating categories. AAA - Debt rated AAA has the highest rating assigned by Standard & Poor's to a debt obligation. Capacity to pay interest and repay principal is extremely strong. AA - Debt rated AA has a very strong capacity to pay interest and repay principal and differs from the higher-rated issues only in small degree. A - Debt rated A has a strong capacity to pay interest and repay principal, although it is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than debt in higher rated categories. BBB - Debt rated BBB is regarded as having an adequate capacity to pay interest and repay principal. Whereas it normally exhibits adequate protection parameters, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to pay interest and repay principal for debt in this category than in higher-rated categories. BB - Debt rated BB has less near-term vulnerability to default than other speculative issues. However, it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to inadequate capacity to meet timely interest and principal payments. The BB rating category is also used for debt subordinated to senior debt that is assigned an actual or implied BBB- rating. B - Debt rated B has a greater vulnerability to default but currently has the capacity to meet interest payments and principal repayments. Adverse business, financial, or economic conditions will likely impair capacity or willingness to pay interest and repay principal. The B rating category is also used for debt subordinated to senior debt that is assigned an actual or implied BB or BB- rating. CCC - Debt rated CCC has a currently identifiable vulnerability to default, and is dependent upon favorable business, financial, and economic conditions to meet timely payment of interest and repayment of principal. In the event of adverse business, financial, or economic conditions, it is not likely to have the capacity to pay interest and repay principal. The CCC rating category is also used for debt subordinated to senior debt that is assigned an actual or implied B or B- rating. CC - Debt rated CC is typically applied to debt subordinated to senior debt which is assigned an actual or implied CCC debt rating. C - The rating C is typically applied to debt subordinated to senior debt which is assigned an actual or implied CCC- debt rating. The C rating may be used to cover a situation where a bankruptcy petition has been filed but debt service payments are continued. CI - The rating CI is reserved for income bonds on which no interest is being paid. D - Debt rated D is in payment default. The D rating category is used when interest payments or principal payments are not made on the date due even if the applicable grace period has not expired, unless S&P believes that such payments will be made during such grace period. The D rating will also be used upon the filing of a bankruptcy petition if debt service payments are jeopardized. CROSS REFERENCE SHEET FORM N-1A ITEM NUMBER PROSPECTUS SECTION
1 .............................. Cover Page 2 a .............................. Expenses b, c .............................. Contents; The Fund at a Glance; Who May Want to Invest 3 a - c .............................. * d .............................. Performance 4 a i............................. Charter ii........................... The Fund at a Glance; Investment Principles and Risks b .............................. Investment Principles and Risks c .............................. Who May Want to Invest; Investment Principles and Risks 5 a .............................. Charter b i............................. Cover Page: The Fund at a Glance; Charter; Doing Business with Fidelity ii........................... Charter iii.......................... Expenses; Breakdown of Expenses c .............................. Charter d .............................. Charter; Breakdown of Expenses e .............................. Cover Page; Charter f .............................. Expenses g i............................. Charter ii............................ * 5A .............................. * 6 a i............................. Charter ii........................... How to Buy Shares; How to Sell Shares; Transaction Details; Exchange Restrictions iii.......................... Charter b ............................. Charter c .............................. Transaction Details; Exchange Restrictions d .............................. * e .............................. Cover Page; Doing Business with Fidelity; How to Buy Shares; How to Sell Shares; Investor Services f, g .............................. Dividends, Capital Gains, and Taxes h .............................. * 7 a .............................. Cover Page; Charter b .............................. Expenses; How to Buy Shares; Transaction Details c .............................. Sales Charge Reductions and Waivers d .............................. How to Buy Shares e .............................. * f .............................. Breakdown of Expenses 8 .............................. How to Sell Shares; Investor Services; Transaction Details; Exchange Restrictions 9 .............................. *
* Not Applicable CROSS REFERENCE SHEET (CONTINUED) FORM N-1A ITEM NUMBER STATEMENT OF ADDITIONAL INFORMATION SECTION
10, 11 ............................ Cover Page 12 ............................ Description of the Trust 13 a - c ............................ Investment Policies and Limitations d ............................ Portfolio Transactions 14 a - c ............................ Trustees and Officers 15 a - c ............................ Trustees and Officers 16 a i........................... FMR; Portfolio Transactions ii.......................... Trustees and Officers iii......................... Management Contract b ............................ Management Contract c, d ............................ Contracts with FMR Affiliates e ............................ * f ............................ Distribution and Service Plan g ............................ * h ............................ Description of the Trust i ............................ Contracts with FMR Affiliates 17 a ............................ Portfolio Transactions b ............................ * c ............................ Portfolio Transactions d, e ............................ * 18 a ............................ Description of the Trust b ............................ * 19 a ............................ Additional Purchase and Redemption Information b ............................ Additional Purchase and Redemption Information; Valuation c ............................ * 20 ............................ Distributions and Taxes 21 a, b ............................ Contracts with FMR Affiliates c ............................ * 22 a ............................ * b ............................ * 23 ............................ *
* Not Applicable FIDELITY CONTRAFUND II Please read this prospectus before investing, and keep it on file for future reference. It contains important information, including how the fund invests and the services available to shareholders. To learn more about the fund and its investments, you can obtain a copy of the fund's Statement of Additional Information (SAI) dated March 25, 1998. The SAI has been filed with the Securities and Exchange Commission (SEC) and is available along with other related materials on the SEC's Internet Web site (http://www.sec.gov). The SAI is incorporated herein by reference (legally forms a part of the prospectus). For a free copy call Fidelity at 1-800-544-8888. MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED BY, ANY DEPOSITORY INSTITUTION. SHARES ARE NOT INSURED BY THE FDIC, FEDERAL RESERVE BOARD, OR ANY OTHER AGENCY, AND ARE SUBJECT TO INVESTMENT RISKS, INCLUDING POSSIBLE LOSS OF PRINCIPAL AMOUNT INVESTED. LIKE ALL MUTUAL FUNDS, THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE. __-PRO-0398 (FUND NUMBER 33 9 , TRADING SYMBOL ___) Contrafund II is a growth fund. It seeks capital appreciation by investing mainly in securities of companies whose value FMR believes is not fully recognized by the public. PROSPECTUS MARCH 25, 1998(FIDELITY_LOGO_GRAPHIC) 82 DEVONSHIRE STREET, BOSTON, MA 02109 CONTENTS KEY FACTS THE FUND AT A GLANCE WHO MAY WANT TO INVEST EXPENSES The fund's sales charge (load) and its yearly operating expenses. PERFORMANCE THE FUND IN DETAIL CHARTER How the fund is organized. INVESTMENT PRINCIPLES AND RISKS The fund's overall approach to investing. BREAKDOWN OF EXPENSES How operating costs are calculated and what they include. YOUR ACCOUNT DOING BUSINESS WITH FIDELITY TYPES OF ACCOUNTS Different ways to set up your account, including tax- advantaged retirement plans. HOW TO BUY SHARES Opening an account and making additional investments. HOW TO SELL SHARES Taking money out and closing your account. INVESTOR SERVICES Services to help you manage your account. SHAREHOLDER AND DIVIDENDS, CAPITAL GAINS, ACCOUNT POLICIES AND TAXES TRANSACTION DETAILS Share price calculations and the timing of purchases and redemptions. EXCHANGE RESTRICTIONS SALES CHARGE REDUCTIONS AND WAIVERS KEY FACTS THE FUND AT A GLANCE GOAL: Capital appreciation (increase in the value of the fund's shares). As with any mutual fund, there is no assurance that the fund will achieve its goal. STRATEGY: Invests mainly in securities of companies whose value FMR believes is not fully recognized by the public. MANAGEMENT: Fidelity Management & Research Company (FMR) is the management arm of Fidelity Investments, which was established in 1946 and is now America's largest mutual fund manager. Foreign affiliates of FMR may help choose investments for the fund. WHO MAY WANT TO INVEST The fund may be appropriate for investors who are willing to ride out stock market fluctuations in pursuit of potentially high long-term returns. The fund is designed for those who are looking for an investment approach that follows a contrarian philosophy. Th is approach focuses on companies whose values FMR believes are not fully recognized by the public. The value of the fund's investments will vary from day to day, and generally reflect market conditions, interest rates, and other company, political, or economic news both here and abroad. In the short-term, stock prices can fluctuate dramatically in response to these factors. The securities of small, less well-know n companies may be more volatile than those of larger companies. Over time, however, stocks have shown greater growth potential than other types of securities. Investments in foreign securities may involve risks in addition to those of U.S. investments, including increased political and economic risk, as well as exposure to currency fluctuations. When you sell your shares, they may be worth more or less than what you paid for them. By itself, the fund does not constitute a balanced investment plan. THE SPECTRUM OF FIDELITY FUNDS BROAD CATEGORIES OF FIDELITY FUNDS ARE PRESENTED HERE IN ORDER OF ASCENDING RISK. GENERALLY, INVESTORS SEEKING TO MAXIMIZE RETURN MUST ASSUME GREATER RISK. CONTRAFUND II IS IN THE GROWTH CATEGORY. (SOLID BULLET) MONEY MARKET SEEKS INCOME AND STABILITY BY INVESTING IN HIGH-QUALITY, SHORT-TERM INVESTMENTS. (SOLID BULLET) INCOME SEEKS INCOME BY INVESTING IN BONDS. (SOLID BULLET) GROWTH AND INCOME SEEKS LONG-TERM GROWTH AND INCOME BY INVESTING IN STOCKS AND BONDS. (RIGHT ARROW) GROWTH SEEKS LONG-TERM GROWTH BY INVESTING MAINLY IN STOCKS. (CHECKMARK) EXPENSES SHAREHOLDER TRANSACTION EXPENSES are charges you may pay when you buy or sell shares of the fund. In addition, you may be charged an annual account maintenance fee if your account balance falls below $2,500. Lower sales charges may be available for accounts over $250,000. See "Transaction Details," page , and "Sales Charge Reductions and Waivers," page , for an explanation of how and when these charges apply. Maximum sales charge on purchases 3.00% (as a % of offering price) Sales charge on reinvested distributions None Deferred sales charge on redemptions None Annual account maintenance fee $12.00 (for accounts under $2,500) ANNUAL FUND OPERATING EXPENSES are paid out of the fund's assets. The fund pays a management fee to FMR that varies based on its performance. It also incurs other expenses for services such as maintaining shareholder records and furnishing shareholder statements and financial reports. The fund's expenses are factored into its share price or dividends and are not charged directly to shareholder accounts (see "Breakdown of Expenses" page ). The following figures are based on estimated expenses of the fund and are calculated as a percentage of average net assets of the fund. Management fee (after reimbursement) 0.57 % 12b-1 fee None Other expenses 0.93 % Total fund operating expenses 1.50 % (after reimbursement) EXAMPLES: Let's say, hypothetically, that the fund's annual return is 5% and that your shareholder transaction expenses and the fund's annual operating expenses are exactly as just described. For every $1,000 you invested, here's how much you would pay in total expenses if you close your account after the number of years indicated: UNDERSTANDING EXPENSES Operating a mutual fund involves a variety of expenses for portfolio management, shareholder statements, tax reporting, and other services. These expenses are paid from the fund's assets, and their effect is already factored into any quoted share price or return. Also, as an investor, you may pay certain expenses directly (for example, the fund's 3% sales charge). (checkmark) 1 year $ 30 3 years $ 62 These examples illustrate the effect of expenses, but are not meant to suggest actual or expected expenses or returns, all of which may vary. FMR has voluntarily agreed to reimburse the fund to the extent that total operating expenses (excluding interest, taxes, brokerage commissions and extraordinary expenses) exceed 1.50 % of its average net assets. If this agreement were not in effect, the management fee and total operating expenses , as a percentage of average net assets, are expected to be 0.59% and 1.52%, respectively. PERFORMANCE This section would normally show how the fund has performed over time. Because the fund was new when this prospectus was printed, its performance is not included. Twice a year, you will receive a report detailing the fund's recent strategies, performance, and holdings. For current performance or a free annual report, call 1-800-544-8888. TOTAL RETURN is the change in value of an investment over a given period, assuming reinvestment of any dividends and capital gains. A CUMULATIVE TOTAL RETURN reflects actual performance over a stated period of time. An AVERAGE ANNUAL TOTAL RETURN is a hypothetical rate of return that, if achieved annually, would have produced the same cumulative total return if performance had been constant over the entire period. Average annual total returns smooth out variations in performance; they are not the same as actual year-by-year results. Average annual total returns covering periods of less than one year assume that performance will remain constant for the rest of the year. STANDARD & POOR'S 500 INDEX (S&P 500(registered trademark)) is a widely recognized, unmanaged index of common stocks. Unlike the fund's returns, the total returns of the comparative index do not include the effect of any brokerage commissions, transaction fees, or other costs of investing. UNDERSTANDING PERFORMANCE Because this fund invests in stocks, its performance is related to that of the overall stock market. Historically, stock market performance has been characterized by volatility in the short run and growth in the long run. (checkmark) Other illustrations of fund performance may show moving averages over specified periods. TOTAL RETURNS ARE BASED ON PAST RESULTS AND ARE NOT AN INDICATION OF FUTURE PERFORMANCE. THE FUND IN DETAIL CHARTER CONTRAFUND II IS A MUTUAL FUND: an investment that pools shareholders' money and invests it toward a specified goal. The fund is a diversified fund of Fidelity Hastings Street Trust, an open-end management investment company organized as a Massachusetts business trust on December 31, 1984. THE FUND IS GOVERNED BY A BOARD OF TRUSTEES which is responsible for protecting the interests of shareholders. The trustees are experienced executives who meet periodically throughout the year to oversee the fund's activities, review contractual arrangements with companies that provide services to the fund, and review the fund's performance. The trustees serve as trustees for other Fidelity funds. The majority of trustees are not otherwise affiliated with Fidelity. THE FUND MAY HOLD SPECIAL SHAREHOLDER MEETINGS AND MAIL PROXY MATERIALS. These meetings may be called to elect or remove trustees, change fundamental policies, approve a management contract, or for other purposes. Shareholders not attending these meetings are encouraged to vote by proxy. Fidelity will mail proxy materials in advance, including a voting card and information about the proposals to be voted on. The number of votes you are entitled to is based upon the dollar value of your investment. FMR AND ITS AFFILIATES The fund is managed by FMR, which chooses the fund's investments and handles its business affairs. Fidelity Management & Research (U.K.) Inc. (FMR U.K.), in London, England, and Fidelity Management & Research (Far East) Inc. (FMR Far East), in Tokyo, Japan, assist FMR with foreign investments. Jason Weiner is manager of Contrafund II, which he has managed since inception. He also manages other Fidelity funds. Since joining Fidelity in 1991, Mr. Weiner has worked as an analyst and manager. . Fidelity investment personnel may invest in securities for their own accounts pursuant to a code of ethics that establishes procedures for personal investing and restricts certain transactions. Fidelity Distributors Corporation (FDC) distributes and markets Fidelity's funds and services. Fidelity Service Company, Inc. (FSC) performs transfer agent servicing functions for the fund. FMR Corp. is the ultimate parent company of FMR, FMR U.K., and FMR Far East. Members of the Edward C. Johnson 3d family are the predominant owners of a class of shares of common stock representing approximately 49% of the voting power of FMR Corp. Under the Investment Company Act of 1940 (the 1940 Act), control of a company is presumed where one individual or group of individuals owns more than 25% of the voting stock of that company; therefore, the Johnson family may be deemed under the 1940 Act to form a controlling group with respect to FMR Corp. FMR may use its broker-dealer affiliates and other firms that sell fund shares to carry out the fund's transactions, provided that the fund receives brokerage services and commission rates comparable to those of other broker-dealers. INVESTMENT PRINCIPLES AND RISKS CONTRAFUND II seeks capital appreciation by investing mainly in securities of companies whose value FMR believes is not fully recognized by the public. The fund normally invests primarily in common stocks and securities convertible into common stock , but it has the flexibility to invest in other types of securities . The types of companies the fund may invest in include: - companies experiencing positive fundamental change such as a new management team or product launch, a significant cost-cutting initiative, a merger or acquisition, or a reduction in industry capacity that should lead to improved pricing; - companies whose earnings potential has increased or is expected to increase more than generally perceived; - companies that have enjoyed recent market popularity but which appear to have temporarily fallen out of favor for reasons that are considered non-recurring or short term; or - companies that are undervalued in relation to securities of other companies in the same industry. The fund's strategy can lead to investments in small and medium-sized companies, which carry more risk than larger ones. These companies, especially small-sized ones, may rely on limited product lines and markets, financial resources, or other factors. This may make them more susceptible to setbacks or downturns. The value of the fund's domestic and foreign investments varies in response to many factors. Stock values fluctuate in response to the activities of individual companies and general market and economic conditions. Investments in foreign securities may involve risks in addition to those of U.S. investments, including increased political and economic risk, as well as exposure to currency fluctuations. FMR may use various investment techniques to hedge a portion of the fund's risks, but there is no guarantee that these strategies will work as FMR intends. Also, as a mutual fund, the fund seeks to spread investment risk by diversifying its holdings among many companies and industries. Of course, when you sell your shares of the fund, they may be worth more or less than what you paid for them. FMR normally invests the fund's assets according to its investment strategy. The fund also reserves the right to invest without limitation in preferred stocks and investment-grade debt instruments for temporary, defensive purposes. SECURITIES AND INVESTMENT PRACTICES The following pages contain more detailed information about types of instruments in which the fund may invest, strategies FMR may employ in pursuit of the fund's investment objective, and a summary of related risks. Any restrictions listed supplement those discussed earlier in this section. A complete listing of the fund's limitations and more detailed information about the fund's investments are contained in the fund's SAI. Policies and limitations are considered at the time of purchase; the sale of instruments is not required in the event of a subsequent change in circumstances. FMR may not buy all of these instruments or use all of these techniques unless it believes that they are consistent with the fund's investment objective and policies and that doing so will help the fund achieve its goal. Fund holdings and recent investment strategies are detailed in the fund's financial reports, which are sent to shareholders twice a year. For a free SAI or financial report, call 1-800-544-8888. EQUITY SECURITIES may include common stocks, preferred stocks, convertible securities, and warrants. Common stocks, the most familiar type, represent an equity (ownership) interest in a corporation. Although equity securities have a history of long-term growth in value, their prices fluctuate based on changes in a company's financial condition and on overall market and economic conditions. Smaller companies are especially sensitive to these factors. RESTRICTIONS: With respect to 75% of total assets, the fund may not purchase more than 10% of the outstanding voting securities of a single issuer. This limitation does not apply to securities of other investment companies. DEBT SECURITIES. Bonds and other debt instruments are used by issuers to borrow money from investors. The issuer generally pays the investor a fixed, variable, or floating rate of interest, and must repay the amount borrowed at maturity. Some debt securities, such as zero coupon bonds, do not pay current interest, but are sold at a discount from their face values. Debt securities have varying levels of sensitivity to changes in interest rates and varying degrees of credit quality. In general, bond prices rise when interest rates fall, and fall when interest rates rise. Longer-term bonds and zero coupon bonds are generally more sensitive to interest rate changes. In addition, bond prices are also affected by the credit quality of the issuer. Investment-grade debt securities are medium- and high-quality securities. Some, however, may possess speculative characteristics, and may be more sensitive to economic changes and to changes in the financial condition of issuers. RESTRICTIONS: Purchase of a debt security is consistent with the fund's debt quality policy if it is rated at or above the stated level by Moody's Investors Service (Moody's) or rated in the equivalent categories by S&P, or is unrated but judged to be of equivalent quality by FMR. The fund currently intends to limit its investments in lower than Baa-quality debt securities to 5% of its assets. EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies, and securities issued by U.S. entities with substantial foreign operations may involve additional risks and considerations. These include risks relating to political , economic , or regulatory conditions in foreign countries ; fluctuations in foreign currencies ; withholding or other taxes ; trading, settlement, custodial, and other operational risks ; and the potentially less stringent investor protection and disclosure standards of foreign markets. Additionally, governmental issuers of foreign debt securities may be unwilling to pay interest and repay principal when due and may require that the conditions for payment be renegotiated. All of these factors can make foreign investments, especially those in emerging markets , more volatile and potentially less liquid than U.S. investments. REPURCHASE AGREEMENTS. In a repurchase agreement, the fund buys a security at one price and simultaneously agrees to sell it back at a higher price. Delays or losses could result if the other party to the agreement defaults or becomes insolvent. ADJUSTING INVESTMENT EXPOSURE. The fund can use various techniques to increase or decrease its exposure to changing security prices, interest rates, currency exchange rates, commodity prices, or other factors that affect security values. These techniques may involve derivative transactions such as buying and selling options and futures contracts, entering into currency exchange contracts or swap agreements and purchasing indexed securities. FMR can use these practices to adjust the risk and return characteristics of the fund's portfolio of investments. If FMR judges market conditions incorrectly or employs a strategy that does not correlate well with the fund's investments, these techniques could result in a loss, regardless of whether the intent was to reduce risk or increase return. These techniques may increase the volatility of the fund and may involve a small investment of cash relative to the magnitude of the risk assumed. In addition, these techniques could result in a loss if the counterparty to the transaction does not perform as promised. ILLIQUID AND RESTRICTED SECURITIES. Some investments may be determined by FMR, under the supervision of the Board of Trustees, to be illiquid, which means that they may be difficult to sell promptly at an acceptable price. The sale of some illiquid securities, and some other securities, may be subject to legal restrictions. Difficulty in selling securities may result in a loss or may be costly to the fund. RESTRICTIONS: The fund may not purchase a security if, as a result, more than 10% of its assets would be invested in illiquid securities. OTHER INSTRUMENTS may include securities of closed-end investment companies and real estate-related instruments. CASH MANAGEMENT. The fund may invest in money market securities, in repurchase agreements, and in a money market fund available only to funds and accounts managed by FMR or its affiliates, whose goal is to seek a high level of current income while maintaining a stable $1.00 share price. A major change in interest rates or a default on the money market fund's investments could cause its share price to change. DIVERSIFICATION. Diversifying a fund's investment portfolio can reduce the risks of investing. This may include limiting the amount of money invested in any one issuer or, on a broader scale, in any one industry. RESTRICTIONS: With respect to 75% of its total assets, the fund may not purchase a security if, as a result, more than 5% would be invested in the securities of any issuer. This limitation does not apply to U.S. Government securities or to securities of other investment companies. The fund may not invest more than 25% of its total assets in any one industry. This limitation does not apply to U.S. Government securities. BORROWING. The fund may borrow from banks or from other funds advised by FMR, or through reverse repurchase agreements. If the fund borrows money, its share price may be subject to greater fluctuation until the borrowing is paid off. If the fund makes additional investments while borrowings are outstanding, this may be considered a form of leverage. RESTRICTIONS: The fund may borrow only for temporary or emergency purposes, but not in an amount exceeding 331/3% of its total assets. LENDING securities to broker-dealers and institutions, including Fidelity Brokerage Services, Inc. (FBSI), an affiliate of FMR, is a means of earning income. This practice could result in a loss or a delay in recovering the fund's securities. The fund may also lend money to other funds advised by FMR. RESTRICTIONS: Loans, in the aggregate, may not exceed 331/3% of the fund's total assets. FUNDAMENTAL INVESTMENT POLICIES AND RESTRICTIONS Some of the policies and restrictions discussed on the preceding pages are fundamental, that is, subject to change only by shareholder approval. The following paragraphs restate all those that are fundamental. All policies stated throughout this prospectus, other than those identified in the following paragraphs, can be changed without shareholder approval. The fund seeks capital appreciation. With respect to 75% of its total assets, the fund may not purchase a security if, as a result, more than 5% would be invested in the securities of any one issuer and may not purchase more than 10% of the outstanding voting securities of a single issuer. These limitations do not apply to U.S. Government securities or to securities of other investment companies. The fund may not invest more than 25% of its total assets in any one industry. This limitation does not apply to U.S. Government securities. The fund may borrow only for temporary or emergency purposes, but not in an amount exceeding 331/3% of its total assets. Loans, in the aggregate, may not exceed 331/3% of the fund's total assets. BREAKDOWN OF EXPENSES Like all mutual funds, the fund pays fees related to its daily operations. Expenses paid out of the fund's assets are reflected in its share price or dividends; they are neither billed directly to shareholders nor deducted from shareholder accounts. The fund pays a MANAGEMENT FEE to FMR for managing its investments and business affairs. FMR in turn pays fees to affiliates who provide assistance with these services. The fund also pays OTHER EXPENSES, which are explained on page . FMR may, from time to time, agree to reimburse the fund for management fees and other expenses above a specified limit. FMR retains the ability to be repaid by the fund if expenses fall below the specified limit prior to the end of the fiscal year. Reimbursement arrangements, which may be terminated at any time without notice, can decrease the fund's expenses and boost its performance. MANAGEMENT FEE The management fee is calculated and paid to FMR every month. The amount of the fee is determined by taking a BASIC FEE and then applying a PERFORMANCE ADJUSTMENT. The performance adjustment either increases or decreases the management fee, depending on how well the fund has performed relative to the S&P 500. UNDERSTANDING THE MANAGEMENT FEE The basic fee FMR receives is designed to be responsive to changes in FMR's total assets under management. Building this variable into the fee calculation assures shareholders that they will pay a lower rate as FMR's assets under management increase. Another variable, the performance adjustment, rewards FMR when the fund outperforms the S&P 500 (an established index of stock market performance) and reduces FMR's fee when the fund underperforms this index. (checkmark) MANAGEMENT = BASIC +/- PERFORMANCE FEE FEE ADJUSTMENT THE BASIC FEE (calculated monthly) is calculated by adding a group fee rate to an individual fund fee rate, and multiplying the result by the fund's average net assets. The group fee rate is based on the average net assets of all the mutual funds advised by FMR. This rate cannot rise above 0.52%, and it drops as total assets under management increase. For January 1998, the group fee rate was 0.2937 %. The individual fund fee rate is 0.30%. The basic fee rate for the fiscal period ended June 30, 1998 is estimated to be 0.59 %. THE PERFORMANCE ADJUSTMENT rate is calculated monthly by comparing the fund's performance to that of the S&P 500 over the performance period. The performance period will begin on April 1, 1998 and will eventually include 36 months. The performance adjustment will not take effect until March 1, 1999. The difference is translated into a dollar amount that is added to or subtracted from the basic fee. The maximum annualized performance adjustment rate is (plus/minus)%0.20 of the fund's average net assets over the performance period. Because of a reimbursement arrangement, the total management fee rate for the fiscal period ended June 30 , 1998 is estimated to be 0.57 %. FMR HAS SUB-ADVISORY AGREEMENTS with FMR U.K. and FMR Far East. These sub-advisers provide FMR with investment research and advice on issuers based outside the United States. Under the sub-advisory agreements, FMR pays FMR U.K. and FMR Far East fees equal to 110% and 105%, respectively, of the costs of providing these services. The sub-advisers may also provide investment management services. In return, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its management fee rate with respect to the fund's investments that the sub-adviser manages on a discretionary basis. OTHER EXPENSES While the management fee is a significant component of the fund's annual operating costs, the fund has other expenses as well. The fund contracts with FSC to perform transfer agency, dividend disbursing, shareholder servicing, and accounting functions. These services include processing shareholder transactions, valuing the fund's investments, handling securities loans, and calculating the fund's share price and dividends. The fund also pays other expenses, such as legal, audit, and custodian fees; in some instances, proxy solicitation costs; and the compensation of trustees who are not affiliated with Fidelity. A broker-dealer may use a portion of the commissions paid by the fund to reduce the fund's custodian or transfer agent fees. The fund has adopted a DISTRIBUTION AND SERVICE PLAN . This Plan recognizes that FMR may use its management fee revenues, as well as its past profits or its resources from any other source, to pay FDC for expenses incurred in connection with the distribution of fund shares. FMR directly, or through FDC, may make payments to third parties, such as banks or broker-dealers, that engage in the sale of, or provide shareholder support services for, the fund's shares. Currently, the Board of Trustees has authorized such payments. The fund's annualized portfolio turnover rate is expected to exceed 100% in the first fiscal period. This rate varies from year to year. High turnover rates increase transaction costs and may increase taxable capital gains. FMR considers these effects when evaluating the anticipated benefits of short-term investing. YOUR ACCOUNT DOING BUSINESS WITH FIDELITY Fidelity Investments was established in 1946 to manage one of America's first mutual funds. Today, Fidelity is the largest mutual fund company in the country, and is known as an innovative provider of high-quality financial services to individuals and institutions. In addition to its mutual fund business, the company operates one of America's leading discount brokerage firms, FBSI. Fidelity is also a leader in providing tax- advantaged retirement plans for individuals investing on their own or through their employer. Fidelity is committed to providing investors with practical information to make investment decisions. Based in Boston, Fidelity provides customers with complete service 24 hours a day, 365 days a year, through a network of telephone service centers around the country. To reach Fidelity for general information, call these numbers: (small solid bullet) For mutual funds, 1-800-544-8888 (small solid bullet) For brokerage, 1-800-544-7272 If you would prefer to speak with a representative in person, Fidelity has over 80 walk-in Investor Centers across the country. TYPES OF ACCOUNTS You may set up an account directly in the fund or, if you own or intend to purchase individual securities as part of your total investment portfolio, you may consider investing in the fund through a brokerage account. You may purchase or sell shares of the fund through an investment professional, including a broker, who may charge you a transaction fee for this service. If you invest through FBSI, another financial institution, or an investment professional, read their program materials for any special provisions, additional service features or fees that may apply to your investment in the fund. Certain features of the fund, such as the minimum initial or subsequent investment amounts, may be modified. FIDELITY FACTS Fidelity offers the broadest selection of mutual funds in the world. (solid bullet) Number of Fidelity mutual funds: over 223 (solid bullet) Assets in Fidelity mutual funds: over $ 537 billion (solid bullet) Number of shareholder accounts: over 35 million (solid bullet) Number of inv e stment analysts and portfolio managers: over 265 (checkmark) The different ways to set up (register) your account with Fidelity are listed in the table that follows. The account guidelines that follow may not apply to certain retirement accounts. If you are investing through a retirement account or if your employer offers the fund through a retirement program, you may be subject to additional fees. For more information, please refer to your program materials, contact your employer, or call your retirement benefits number or Fidelity directly, as appropriate. WAYS TO SET UP YOUR ACCOUNT INDIVIDUAL OR JOINT TENANT FOR YOUR GENERAL INVESTMENT NEEDS Individual accounts are owned by one person. Joint accounts can have two or more owners (tenants). RETIREMENT FOR TAX-ADVANTAGED RETIREMENT SAVINGS Retirement plans provide individuals with tax-advantaged ways to save for retirement, either with tax-deductible contributions or tax-free growth. Retirement accounts require special applications and typically have lower minimums. (solid bullet) TRADITIONAL INDIVIDUAL RETIREMENT ACCOUNTS (IRAS) allow individuals under age 70 with compensation to contribute up to $2,000 per tax year. Married couples can contribute up to $4,000 per tax year, provided no more than $2,000 is contributed on behalf of either spouse. (These limits are aggregate for Traditional and Roth IRAs.) Contributions may be tax deductible, subject to certain income limits. (solid bullet) ROTH IRAS allow individuals to make non-deductible contributions of up to $2,000 per tax year. Married couples can contribute up to $4,000 per tax year, provided no more than $2,000 is contributed on behalf of either spouse. (These limits are aggregate for Traditional and Roth IRAs.) Eligibility is subject to certain income limits. Qualified distributions are tax-free. (solid bullet) ROTH CONVERSION IRAS allow individuals with assets held in a Traditional IRA or Rollover IRA to convert those assets to a Roth Conversion IRA. Eli g ibility is subject to certain income limits. Qualified distributions are tax-free. (solid bullet) ROLLOVER IRAS help retain special tax advantages for certain eligible rollover distributions from employer-sponsored retirement plans. (solid bullet) PROFIT SHARING OR MONEY PURCHASE PENSION PLANS (KEOGHS) allow self-employed individuals or small business owners to make tax-deductible contributions for themselves and any eligible employees. (solid bullet) SIMPLIFIED EMPLOYEE PENSION PLANS (SEP-IRAS) provide small business owners or those with self-employment income (and their eligible employees) with many of the same advantages as a Keogh, but with fewer administrative requirements. (solid bullet) SALARY REDUCTION SEP-IRAS (SARSEPS) allow employees of businesses with 25 or fewer employees to contribute a percentage of their wages on a tax-defe r red basis. Th e se plans must have been established by the employer prior to January 1, 1997. (solid bullet) SIMPLE IRAS provide small business owners and those with self-employment income (and their eligible employees) with many of the advantages of a 401(k) plan, but with fewer administrative requirements. (solid bullet) 403(B) CUSTODIAL ACCOUNTS are available to employees of 501(c)(3) tax-exempt institutions, including schools, hospitals, and other charitable organizations. (solid bullet) 401(K) PLANS allow employees of organizations of all sizes to contribute a percentage of their wages on a tax-deferred basis. These accounts need to be established by the trustee of the plan. (solid bullet) DEFERRED COMPENSATION PLANS (457 PLANS) are available to employees of most state and local governments and their agencies and to employees of tax-exempt institutions. GIFTS OR TRANSFERS TO A MINOR (UGMA, UTMA) TO INVEST FOR A CHILD'S EDUCATION OR OTHER FUTURE NEEDS These custodial accounts provide a way to give money to a child and obtain tax benefits. An individual can give up to $10,000 a year per child without paying federal gift tax. Depending on state laws, you can set up a custodial account under the Uniform Gifts to Minors Act (UGMA) or the Uniform Transfers to Minors Act (UTMA). TRUST FOR MONEY BEING INVESTED BY A TRUST The trust must be established before an account can be opened. BUSINESS OR ORGANIZATION FOR INVESTMENT NEEDS OF CORPORATIONS, ASSOCIATIONS, PARTNERSHIPS, OR OTHER GROUPS Requires a special application. HOW TO BUY SHARES THE PRICE TO BUY ONE SHARE of the fund is the fund's offering price or the fund's net asset value per share (NAV), depending on whether you pay a sales charge. If you pay a sales charge, your price will be the fund's offering price. When you buy shares of the fund at the offering price, Fidelity deducts the appropriate sales charge and invests the rest in the fund. If you qualify for a sales charge waiver, your price will be the fund's NAV. See "Sales Charge Reductions and Waivers," page , for an explanation of how and when the sales charge and waivers apply. Your shares will be purchased at the next offering price or NAV, as applicable, calculated after your investment is received in proper form. The fund's offering price and NAV are normally calculated each business day at 4:00 p.m. Eastern time. The fund reserves the right to reject any specific purchase order, including certain purchases by exchange. See "Exchange Restrictions" on page . Purchase orders may be refused if, in FMR's opinion, they would disrupt management of the fund. IF YOU ARE NEW TO FIDELITY, complete and sign an account application and mail it along with your check. You may also open your account in person or by wire as described on page . If there is no application accompanying this prospectus, call 1-800-544-8888. IF YOU ALREADY HAVE MONEY INVESTED IN A FIDELITY FUND, you can: (small solid bullet) Mail in an application with a check, or (small solid bullet) Open your account by exchanging from another Fidelity fund. IF YOU ARE INVESTING THROUGH A TAX-ADVANTAGED RETIREMENT PLAN, such as an IRA, for the first time, you will need a special application. Retirement investing also involves its own investment procedures. Call 1-800-544-8888 for more information and a retirement application. If you buy shares by check or Fidelity Money Line(registered trademark), and then sell those shares by any method other than by exchange to another Fidelity fund, the payment may be delayed for up to seven business days to ensure that your previous investment has cleared. MINIMUM INVESTMENTS TO OPEN AN ACCOUNT $2,500 For certain Fidelity retirement accounts(double dagger) $500 TO ADD TO AN ACCOUNT $250 For certain Fidelity retirement accounts(double dagger) $250 Through regular investment plans* $100 MINIMUM BALANCE $2,000 For certain Fidelity retirement accounts(double dagger) $500 (double dagger) THESE LOWER MINIMUMS APPLY TO FIDELITY TRADITIONAL IRA, ROTH IRA, ROTH CONVERSION IRA, ROLLOVER IRA, SEP-IRA, AND KEOGH ACCOUNTS. * FOR MORE INFORMATION ABOUT REGULAR INVESTMENT PLANS, PLEASE REFER TO "INVESTOR SERVICES," PAGE . These minimums may vary for investments through Fidelity Portfolio Advisory Services. There is no minimum account balance or initial or subsequent investment minimum for certain retirement accounts funded through salary deduction, or accounts opened with the proceeds of distributions from Fidelity retirement accounts. Refer to the program materials for details.
TO OPEN TO ADD TO AN AN ACCOUNT ACCOUNT PHONE 1-800-544-7777 (PHONE_GRAPHIC) (SMALL SOLID BULLET) EXCHANGE FROM (SMALL SOLID BULLET) EXCHANGE ANOTHER FIDELITY FROM ANOTHER FUND ACCOUNT FIDELITY FUND WITH THE SAME ACCOUNT WITH REGISTRATION, THE SAME INCLUDING NAME, REGISTRATION, ADDRESS, AND INCLUDING TAXPAYER ID NAME, NUMBER. ADDRESS, AND TAXPAYER ID NUMBER. (SMALL SOLID BULLET) USE FIDELITY MONEY LINE TO TRANSFER FROM YOUR BANK ACCOUNT. CALL BEFORE YOUR FIRST USE TO VERIFY THAT THIS SERVICE IS IN PLACE ON YOUR ACCOUNT. MAXIMUM MONEY LINE: UP TO $100,000. MAIL (MAIL_GRAPHIC) (SMALL SOLID BULLET) COMPLETE AND (SMALL SOLID BULLET) MAKE YOUR SIGN THE CHECK PAYABLE APPLICATION. TO MAKE YOUR "CONTRAFUND CHECK PAYABLE II." INDICATE TO "CONTRAFUND YOUR FUND II." MAIL TO THE ACCOUNT ADDRESS NUMBER ON INDICATED ON THE YOUR CHECK APPLICATION. AND MAIL TO THE ADDRESS PRINTED ON YOUR ACCOUNT STATEMENT. (SMALL SOLID BULLET) EXCHANGE BY MAIL: CALL 1-800-544-66 66 FOR INSTRUCTIONS. IN PERSON (HAND_GRAPHIC) (SMALL SOLID BULLET) BRING YOUR (SMALL SOLID BULLET) BRING YOUR APPLICATION AND CHECK TO A CHECK TO A FIDELITY FIDELITY INVESTOR INVESTOR CENTER. CALL CENTER. CALL 1-800-544-97 1-800-544-9 97 FOR THE 797 FOR THE CENTER NEAREST CENTER NEAREST YOU. YOU. WIRE (WIRE_GRAPHIC) (SMALL SOLID BULLET) CALL (SMALL SOLID BULLET) NOT AVAILABLE 1-800-544-77 FOR RETIREMENT 77 TO SET UP ACCOUNTS. YOUR ACCOUNT (SMALL SOLID BULLET) WIRE TO: AND TO ARRANGE BANKERS TRUST A WIRE COMPANY, TRANSACTION. BANK ROUTING NOT AVAILABLE #02100103 FOR RETIREMENT 3, ACCOUNTS. ACCOUNT (SMALL SOLID BULLET) WIRE WITHIN 24 #00163053. HOURS TO: SPECIFY BANKERS TRUST "CONTRAFUND COMPANY, II" AND BANK ROUTING INCLUDE YOUR #021001033, ACCOUNT ACCOUNT NUMBER AND #00163053. YOUR NAME. SPECIFY "CONTRAFUND II" AND INCLUDE YOUR NEW ACCOUNT NUMBER AND YOUR NAME. AUTOMATICALLY (AUTOMATIC_GRAPHIC) (SMALL SOLID BULLET) NOT AVAILABLE. (SMALL SOLID BULLET) USE FIDELITY AUTOMATIC ACCOUNT BUILDER. SIGN UP FOR THIS SERVICE WHEN OPENING YOUR ACCOUNT, OR CALL 1-800-544- 6666 TO ADD IT.
(TDD_GRAPHIC) TDD - SERVICE FOR THE DEAF AND HEARING IMPAIRED: 1-800-544-0118
HOW TO SELL SHARES You can arrange to take money out of your fund account at any time by selling (redeeming) some or all of your shares. THE PRICE TO SELL ONE SHARE of the fund is the fund's NAV. Your shares will be sold at the next NAV calculated after your order is received in proper form. The fund's NAV is normally calculated each business day at 4:00 p.m. Eastern time. TO SELL SHARES IN A NON-RETIREMENT ACCOUNT, you may use any of the methods described on these two pages. TO SELL SHARES IN A FIDELITY RETIREMENT ACCOUNT, your request must be made in writing, except for exchanges to other Fidelity funds, which can be requested by phone or in writing. Call 1-800-544-6666 for a retirement distribution form. IF YOU ARE SELLING SOME BUT NOT ALL OF YOUR SHARES, leave at least $2,000 worth of shares in the account to keep it open ($500 for retirement accounts). TO SELL SHARES BY BANK WIRE OR FIDELITY MONEY LINE, you will need to sign up for these services in advance. CERTAIN REQUESTS MUST INCLUDE A SIGNATURE GUARANTEE. It is designed to protect you and Fidelity from fraud. Your request must be made in writing and include a signature guarantee if any of the following situations apply: (small solid bullet) You wish to redeem more than $100,000 worth of shares, (small solid bullet) Your account registration has changed within the last 30 days, (small solid bullet) The check is being mailed to a different address than the one on your account (record address), (small solid bullet) The check is being made payable to someone other than the account owner, or (small solid bullet) The redemption proceeds are being transferred to a Fidelity account with a different registration. You should be able to obtain a signature guarantee from a bank, broker (including Fidelity Investor Centers), dealer, credit union (if authorized under state law), securities exchange or association, clearing agency, or savings association. A notary public cannot provide a signature guarantee. SELLING SHARES IN WRITING Write a "letter of instruction" with: (small solid bullet) Your name, (small solid bullet) The fund's name, (small solid bullet) Your fund account number, (small solid bullet) The dollar amount or number of shares to be redeemed, and (small solid bullet) Any other applicable requirements listed in the table that follows. Unless otherwise instructed, Fidelity will send a check to the record address. Deliver your letter to a Fidelity Investor Center, or mail it to: Fidelity Investments P.O. Box 660602 Dallas, TX 75266-0602 ACCOUNT TYPE SPECIAL REQUIREMENTS
PHONE 1-800-544-7777 (PHONE_GRAPHIC) ALL ACCOUNT TYPES (SMALL SOLID BULLET) MAXIMUM EXCEPT RETIREMENT CHECK REQUEST: $100,000. ALL ACCOUNT TYPES (SMALL SOLID BULLET) FOR MONEY LINE TRANSFERS TO YOUR BANK ACCOUNT; MINIMUM: $10; MAXIMUM: UP TO $100,000. (SMALL SOLID BULLET) YOU MAY EXCHANGE TO OTHER FIDELITY FUNDS IF BOTH ACCOUNTS ARE REGISTERED WITH THE SAME NAME(S), ADDRESS, AND TAXPAYER ID NUMBER. MAIL OR IN PERSON (MAIL_GRAPHIC)(HAND_GRAPHIC) INDIVIDUAL, JOINT (SMALL SOLID BULLET) THE LETTER OF TENANT, INSTRUCTION SOLE PROPRIETORSHI MUST BE P, UGMA, UTMA SIGNED BY ALL RETIREMENT PERSONS ACCOUNT REQUIRED TO SIGN FOR TRANSACTIONS, TRUST EXACTLY AS THEIR NAMES APPEAR ON THE ACCOUNT. BUSINESS OR (SMALL SOLID BULLET) THE ACCOUNT ORGANIZATION OWNER SHOULD COMPLETE A RETIREMENT DISTRIBUTION FORM. CALL EXECUTOR, 1-800-544-66 ADMINISTRATOR, 66 TO REQUEST CONSERVATOR, ONE. GUARDIAN (SMALL SOLID BULLET) THE TRUSTEE MUST SIGN THE LETTER INDICATING CAPACITY AS TRUSTEE. IF THE TRUSTEE'S NAME IS NOT IN THE ACCOUNT REGISTRATION, PROVIDE A COPY OF THE TRUST DOCUMENT CERTIFIED WITHIN THE LAST 60 DAYS. (SMALL SOLID BULLET) AT LEAST ONE PERSON AUTHORIZED BY CORPORATE RESOLUTION TO ACT ON THE ACCOUNT MUST SIGN THE LETTER. (SMALL SOLID BULLET) INCLUDE A CORPORATE RESOLUTION WITH CORPORATE SEAL OR A SIGNATURE GUARANTEE. (SMALL SOLID BULLET) CALL 1-800-544-66 66 FOR INSTRUCTIONS. WIRE (WIRE_GRAPHIC) ALL ACCOUNT TYPES (SMALL SOLID BULLET) YOU MUST SIGN EXCEPT RETIREMENT UP FOR THE WIRE FEATURE BEFORE USING IT. TO VERIFY THAT IT IS IN PLACE, CALL 1-800-544-66 66. MINIMUM WIRE: $5,000. (SMALL SOLID BULLET) YOUR WIRE REDEMPTION REQUEST MUST BE RECEIVED IN PROPER FORM BY FIDELITY BEFORE 4:00 P.M. EASTERN TIME FOR MONEY TO BE WIRED ON THE NEXT BUSINESS DAY.
(TDD_GRAPHIC) TDD - SERVICE FOR THE DEAF AND HEARING IMPAIRED: 1-800-544-0118
INVESTOR SERVICES Fidelity provides a variety of services to help you manage your account. INFORMATION SERVICES FIDELITY'S TELEPHONE REPRESENTATIVES are available 24 hours a day, 365 days a year. Whenever you call, you can speak with someone equipped to provide the information or service you need. 24-HOUR SERVICE ACCOUNT ASSISTANCE 1-800-544-6666 ACCOUNT TRANSACTIONS 1-800-544-7777 PRODUCT INFORMATION 1-800-544-8888 RETIREMENT ACCOUNT ASSISTANCE 1-800-544-4774 TOUCHTONE XPRESSSM 1-800-544-5555 AUTOMATED SERVICE (checkmark) STATEMENTS AND REPORTS that Fidelity sends to you include the following: (small solid bullet) Confirmation statements (after every transaction, except reinvestments, that affects your account balance or your account registration) (small solid bullet) Account statements (quarterly) (small solid bullet) Financial reports (every six months) To reduce expenses, only one copy of most financial reports and prospectuses will be mailed to your household, even if you have more than one account in the fund. Call 1-800-544-6666 if you need copies of financial reports, prospectuses, or historical account information. TRANSACTION SERVICES EXCHANGE PRIVILEGE. You may sell your fund shares and buy shares of other Fidelity funds by telephone or in writing. The shares you exchange will carry credit for any sales charge you previously paid in connection with their purchase. Note that exchanges out of the fund are limited to four per calendar year, and that they may have tax consequences for you. For details on policies and restrictions governing exchanges, including circumstances under which a shareholder's exchange privilege may be suspended or revoked, see page . SYSTEMATIC WITHDRAWAL PLANS let you set up periodic redemptions from your account. Because of the fund's sales charge, you may not want to set up a systematic withdrawal plan during a period when you are buying shares on a regular basis. FIDELITY MONEY LINE(registered trademark) enables you to transfer money by phone between your bank account and your fund account. Most transfers are complete within three business days of your call. REGULAR INVESTMENT PLANS One easy way to pursue your financial goals is to invest money regularly. Fidelity offers convenient services that let you transfer money into your fund account, or between fund accounts, automatically. While regular investment plans do not guarantee a profit and will not protect you against loss in a declining market, they can be an excellent way to invest for retirement, a home, educational expenses, and other long-term financial goals. Certain restrictions apply for retirement accounts. Call 1-800-544-6666 for more information. REGULAR INVESTMENT PLANS FIDELITY AUTOMATIC ACCOUNT BUILDERSM TO MOVE MONEY FROM YOUR BANK ACCOUNT TO A FIDELITY FUND
MINIMUM FREQUENCY SETTING UP OR CHANGING $100 MONTHLY OR QUARTERLY (SMALL SOLID BULLET) FOR A NEW ACCOUNT, COMPLETE THE APPROPRIATE SECTION ON THE FUND APPLICATION. (SMALL SOLID BULLET) FOR EXISTING ACCOUNTS, CALL 1-800-544-6666 FOR AN APPLICATION. (SMALL SOLID BULLET) TO CHANGE THE AMOUNT OR FREQUENCY OF YOUR INVESTMENT, CALL 1-800-544-6666 AT LEAST THREE BUSINESS DAYS PRIOR TO YOUR NEXT SCHEDULED INVESTMENT DATE.
DIRECT DEPOSIT TO SEND ALL OR A PORTION OF YOUR PAYCHECK OR GOVERNMENT CHECK TO A FIDELITY FUNDA
MINIMUM FREQUENCY SETTING UP OR CHANGING $100 EVERY PAY PERIOD (SMALL SOLID BULLET) CHECK THE APPROPRIATE BOX ON THE FUND APPLICATION, OR CALL 1-800-544-6666 FOR AN AUTHORIZATION FORM. (SMALL SOLID BULLET) CHANGES REQUIRE A NEW AUTHORIZATION FORM.
FIDELITY AUTOMATIC EXCHANGE SERVICE TO MOVE MONEY FROM A FIDELITY MONEY MARKET FUND TO ANOTHER FIDELITY FUND
MINIMUM FREQUENCY SETTING UP OR CHANGING $100 Monthly, bimonthly, quarterly, or (small solid bullet) To establish, call annually 1-800-544-6666 after both accounts are opened. (small solid bullet) To change the amount or frequency of your investment, call 1-800-544-6666.
A BECAUSE ITS SHARE PRICE FLUCTUATES, THE FUND MAY NOT BE AN APPROPRIATE CHOICE FOR DIRECT DEPOSIT OF YOUR ENTIRE CHECK. SHAREHOLDER AND ACCOUNT POLICIES DIVIDENDS, CAPITAL GAINS, AND TAXES The fund distributes substantially all of its net income and capital gains to shareholders each year. Normally, dividends and capital gains are distributed in August and December. DISTRIBUTION OPTIONS When you open an account, specify on your application how you want to receive your distributions. If the option you prefer is not listed on the application, call 1-800-544-6666 for instructions. The fund offers four options: 1. REINVESTMENT OPTION. Your dividend and capital gain distributions will be automatically reinvested in additional shares of the fund. If you do not indicate a choice on your application, you will be assigned this option. 2. INCOME-EARNED OPTION. Your capital gain distributions will be automatically reinvested, but you will be sent a check for each dividend distribution. 3. CASH OPTION. You will be sent a check for your dividend and capital gain distributions. 4. DIRECTED DIVIDENDS(registered trademark) OPTION. Your dividend and capital gain distributions will be automatically invested in another identically registered Fidelity fund. SHARES PURCHASED THROUGH REINVESTMENT of dividend and capital gain distributions are not subject to a sales charge. If you direct distributions to a fund with a 3.00% sales charge, you will not pay a sales charge on those purchases. When the fund deducts a distribution from its NAV, the reinvestment price is the fund's NAV at the close of business that day. Cash distribution checks will be mailed within seven days. UNDERSTANDING DISTRIBUTIONS AS A FUND SHAREHOLDER, YOU ARE ENTITLED TO YOUR SHARE OF THE FUND'S NET INCOME AND GAINS ON ITS INVESTMENTS. THE FUND PASSES ITS EARNINGS ALONG TO ITS INVESTORS AS DISTRIBUTIONS. THE FUND EARNS DIVIDENDS FROM STOCKS AND INTEREST FROM BOND, MONEY MARKET, AND OTHER INVESTMENTS. THESE ARE PASSED ALONG AS DIVIDEND DISTRIBUTIONS. THE FUND REALIZES CAPITAL GAINS WHENEVER IT SELLS SECURITIES FOR A HIGHER PRICE THAN IT PAID FOR THEM. THESE ARE PASSED ALONG AS CAPITAL GAIN DISTRIBUTIONS. (CHECKMARK) TAXES As with any investment, you should consider how your investment in the fund will be taxed. If your account is not a tax-advantaged retirement account, you should be aware of these tax implications. TAXES ON DISTRIBUTIONS. Distributions are subject to federal income tax, and may also be subject to state or local taxes. If you live outside the United States, your distributions could also be taxed by the country in which you reside. Your distributions are taxable when they are paid, whether you take them in cash or reinvest them. However, distributions declared in December and paid in January are taxable as if they were paid on December 31. For federal tax purposes, the fund's income and short-term capital gains are distributed as dividends and taxed as ordinary income; capital gain distributions are taxed as long-term capital gains. Every January, Fidelity will send you and the IRS a statement showing the tax characterization of distributions paid to you in the previous year. TAXES ON TRANSACTIONS. Your redemptions - including exchanges to other Fidelity funds - are subject to capital gains tax. A capital gain or loss is the difference between the cost of your shares and the price you receive when you sell them. Whenever you sell shares of the fund, Fidelity will send you a confirmation statement showing how many shares you sold and at what price. You will also receive a consolidated transaction statement every January. However, it is up to you or your tax preparer to determine whether this sale resulted in a capital gain and, if so, the amount of tax to be paid. Be sure to keep your regular account statements; the information they contain will be essential in calculating the amount of your capital gains. "BUYING A DIVIDEND." If you buy shares when the fund has realized but not yet distributed income or capital gains, you will pay the full price for the shares and then receive a portion of the price back in the form of a taxable distribution. EFFECT OF FOREIGN TAXES. Foreign governments may impose taxes on the fund and its investments , and these taxes generally will reduce the fund's distributions. However, if you meet certain holding period requirements with respect to your fund shares, an offsetting tax credit may be available to you. If you do not meet such holding period requirements, you may still be entitled to a deduction for certain foreign taxes. In either case, your tax statement will show more taxable income or capital gains than were actually distributed by the fund, but will also show the amount of the available offsetting credit or deduction. There are tax requirements that all funds must follow in order to avoid federal taxation. In its effort to adhere to these requirements, the fund may have to limit its investment activity in some types of instruments. TRANSACTION DETAILS THE FUND IS OPEN FOR BUSINESS each day the New York Stock Exchange (NYSE) is open. FSC normally calculates the fund's NAV and offering price as of the close of business of the NYSE, normally 4:00 p.m. Eastern time. THE FUND'S NAV is the value of a single share. The NAV is computed by adding the value of the fund's investments, cash, and other assets, subtracting its liabilities, and then dividing the result by the number of shares outstanding. The fund's assets are valued primarily on the basis of market quotations. Short-term securities with remaining maturities of sixty days or less for which quotations are not readily available are valued on the basis of amortized cost. This method minimizes the effect of changes in a security's market value. Foreign securities are valued on the basis of quotations from the primary market in which they are traded, and are translated from the local currency into U.S. dollars using current exchange rates. In addition, if quotations are not readily available, or if the values have been materially affected by events occurring after the closing of a foreign market, assets may be valued by another method that the Board of Trustees believes accurately reflects fair value. THE OFFERING PRICE of the fund is its NAV divided by the difference between one and the applicable sales charge percentage. The maximum sales charge is 3.00% of the offering price. WHEN YOU SIGN YOUR ACCOUNT APPLICATION, you will be asked to certify that your social security or taxpayer identification number is correct and that you are not subject to 31% backup withholding for failing to report income to the IRS. If you violate IRS regulations, the IRS can require the fund to withhold 31% of your taxable distributions and redemptions. YOU MAY INITIATE MANY TRANSACTIONS BY TELEPHONE OR ELECTRONICALLY. Fidelity will not be responsible for any losses resulting from unauthorized transactions if it follows reasonable security procedures designed to verify the identity of the investor. Fidelity will request personalized security codes or other information, and may also record calls. For transactions conducted through the Internet, Fidelity recommends the use of an Internet browser with 128-bit encryption. You should verify the accuracy of your confirmation statements immediately after you receive them. If you do not want the ability to redeem and exchange by telephone, call Fidelity for instructions. IF YOU ARE UNABLE TO REACH FIDELITY BY PHONE (for example, during periods of unusual market activity), consider placing your order by mail or by visiting a Fidelity Investor Center. THE FUND RESERVES THE RIGHT to suspend the offering of shares for a period of time. WHEN YOU PLACE AN ORDER TO BUY SHARES, your shares will be purchased at the next offering price or NAV, as applicable, calculated after your investment is received in proper form. Note the following: (small solid bullet) All of your purchases must be made in U.S. dollars and checks must be drawn on U.S. banks. (small solid bullet) Fidelity does not accept cash. (small solid bullet) When making a purchase with more than one check, each check must have a value of at least $50. (small solid bullet) The fund reserves the right to limit the number of checks processed at one time. (small solid bullet) If your check does not clear, your purchase will be canceled and you could be liable for any losses or fees the fund or its transfer agent has incurred. TO AVOID THE COLLECTION PERIOD associated with check and Money Line purchases, consider buying shares by bank wire, U.S. Postal money order, U.S. Treasury check, Federal Reserve check, or direct deposit instead. CERTAIN FINANCIAL INSTITUTIONS that have entered into sales agreements with FDC may enter confirmed purchase orders on behalf of customers by phone, with payment to follow no later than the time when the fund is priced on the following business day. If payment is not received by that time, the financial institution could be held liable for resulting fees or losses. WHEN YOU PLACE AN ORDER TO SELL SHARES, your shares will be sold at the next NAV calculated after your order is received in proper form. Note the following: (small solid bullet) Normally, redemption proceeds will be mailed to you on the next business day, but if making immediate payment could adversely affect the fund, it may take up to seven days to pay you. (small solid bullet) Fidelity Money Line redemptions generally will be credited to your bank account on the second or third business day after your phone call. (small solid bullet) The fund may hold payment on redemptions until it is reasonably satisfied that investments made by check or Fidelity Money Line have been collected, which can take up to seven business days. (small solid bullet) Redemptions may be suspended or payment dates postponed when the NYSE is closed (other than weekends or holidays), when trading on the NYSE is restricted, or as permitted by the SEC. FIDELITY RESERVES THE RIGHT TO DEDUCT AN ANNUAL MAINTENANCE FEE of $12.00 from accounts with a value of less than $2,500 (including any amount paid as a sales charge), subject to an annual maximum charge of $24.00 per shareholder. It is expected that accounts will be valued on the second Friday in November of each year. Accounts opened after September 30 will not be subject to the fee for that year. The fee, which is payable to the transfer agent, is designed to offset in part the relatively higher costs of servicing smaller accounts. This fee will not be deducted from Fidelity brokerage accounts, retirement accounts (except non-prototype retirement accounts), accounts using regular investment plans, or if total assets with Fidelity exceed $30,000. Eligibility for the $30,000 waiver is determined by aggregating Fidelity accounts maintained by FSC or FBSI which are registered under the same social security number or which list the same social security number for the custodian of a Uniform Gifts/Transfers to Minors Act account. IF YOUR ACCOUNT BALANCE FALLS BELOW $2,000, you will be given 30 days' notice to reestablish the minimum balance. If you do not increase your balance, Fidelity reserves the right to close your account and send the proceeds to you. Your shares will be redeemed at the NAV on the day your account is closed. FIDELITY MAY CHARGE A FEE FOR SPECIAL SERVICES, such as providing historical account documents, that are beyond the normal scope of its services. FDC collects the proceeds from the fund's 3.00% sales charge and may pay a portion of them to securities dealers who have sold the fund's shares, or to others, including banks and other financial institutions (qualified recipients), under special arrangements in connection with FDC's sales activities. The sales charge paid to qualified recipients is 1.50% of the fund's offering price. FDC may, at its own expense, provide promotional incentives to qualified recipients who support the sale of shares of the fund without reimbursement from the fund. In some instances, these incentives may be offered only to certain institutions whose representatives provide services in connection with the sale or expected sale of significant amounts of shares. EXCHANGE RESTRICTIONS As a shareholder, you have the privilege of exchanging shares of the fund for shares of other Fidelity funds. However, you should note the following: (small solid bullet) The fund you are exchanging into must be available for sale in your state. (small solid bullet) You may only exchange between accounts that are registered in the same name, address, and taxpayer identification number. (small solid bullet) Before exchanging into a fund, read its prospectus. (small solid bullet) If you exchange into a fund with a sales charge, you pay the percentage-point difference between that fund's sales charge and any sales charge you have previously paid in connection with the shares you are exchanging. For example, if you had already paid a sales charge of 2% on your shares and you exchange them into a fund with a 3% sales charge, you would pay an additional 1% sales charge. (small solid bullet) Exchanges may have tax consequences for you. (small solid bullet) Because excessive trading can hurt fund performance and shareholders, the fund reserves the right to temporarily or permanently terminate the exchange privilege of any investor who makes more than four exchanges out of the fund per calendar year. Accounts under common ownership or control, including accounts with the same taxpayer identification number, will be counted together for purposes of the four exchange limit. (small solid bullet) The exchange limit may be modified for accounts in certain institutional retirement plans to conform to plan exchange limits and Department of Labor regulations. See your plan materials for further information. (small solid bullet) The fund reserves the right to refuse exchange purchases by any person or group if, in FMR's judgment, the fund would be unable to invest the money effectively in accordance with its investment objective and policies, or would otherwise potentially be adversely affected. (small solid bullet) Your exchanges may be restricted or refused if the fund receives or anticipates simultaneous orders affecting significant portions of the fund's assets. In particular, a pattern of exchanges that coincides with a "market timing" strategy may be disruptive to the fund. Although the fund will attempt to give you prior notice whenever it is reasonably able to do so, it may impose these restrictions at any time. The fund reserves the right to terminate or modify the exchange privilege in the future. OTHER FUNDS MAY HAVE DIFFERENT EXCHANGE RESTRICTIONS, and may impose administrative fees of up to 1.00% and trading fees of up to 3.00 % of the amount exchanged. Check each fund's prospectus for details. SALES CHARGE REDUCTIONS AND WAIVERS REDUCTIONS. The fund's sales charge may be reduced if you invest directly with Fidelity or through prototype or prototype-like retirement plans sponsored by FMR or FMR Corp. The amount you invest, plus the value of your account, must fall within the ranges shown below. Purchases made with assistance or intervention from a financial intermediary are not eligible for a sales charge reduction. Call Fidelity to see if your purchase qualifies. Sales Charge Ranges As a % As an approximate % of net amount of Offering Price invested $0 - 249,999 3.00% 3.09% $250,000 - 499,999 2.00% 2.04% $500,000 - 999,999 1.00% 1.01% $1,000,000 or more none none The sales charge will also be reduced by the percentage of any sales charge you previously paid on investments in other Fidelity funds or by the percentage of any sales charge you would have paid if the reductions in the table above had not existed. These sales charge credits only apply to purchases made in one of the ways listed below, and only if you continuously owned Fidelity fund shares, maintained a Fidelity brokerage core account, or participated in The CORPORATEplan for Retirement Program. 1. By exchange from another Fidelity fund. 2. With proceeds from a transaction in a Fidelity brokerage core account, including any free credit balance, core money market fund, or margin availability, to the extent such proceeds were derived from redemption proceeds from another Fidelity fund. 3. As a participant in The CORPORATEplan for Retirement Program when shares are purchased through plan-qualified loan repayments, and for exchanges into and out of the Managed Income Portfolio. WAIVERS. The fund's sales charge will not apply: 1. If you buy shares as part of an employee benefit plan having more than 200 eligible employees or a minimum of $3 million in plan assets invested in Fidelity mutual funds. 2. To shares in a Fidelity account purchased with the proceeds of a distribution from an employee benefit plan, provided that at the time of the distribution, the employer or its affiliate maintained a plan that both qualified for waiver (1) above and had at least some of its assets invested in Fidelity-managed products. (Distributions transferred to an IRA account must be transferred within 60 days from the date of the distribution. All other distributions must be transferred directly into a Fidelity account). 3. If you are a charitable organization (as defined for purposes of Section 501(c)(3) of the Internal Revenue Code) investing $100,000 or more. 4. If you purchase shares for a charitable remainder trust or life income pool established for the benefit of a charitable organization (as defined for purposes of Section 501(c)(3) of the Internal Revenue Code). 5. If you are an investor participating in the Fidelity Trust Portfolios program. 6. To shares purchased by a mutual fund for which FMR or an affiliate serves as investment manager. 7. To shares purchased through Portfolio Advisory Services or Fidelity Charitable Advisory Services. 8. If you are a current or former trustee or officer of a Fidelity fund or a current or retired officer, director, or regular employee of FMR Corp. or Fidelity International Limited or their direct or indirect subsidiaries (a Fidelity trustee or employee), the spouse of a Fidelity trustee or employee, a Fidelity trustee or employee acting as custodian for a minor child, or a person acting as trustee of a trust for the sole benefit of the minor child of a Fidelity trustee or employee. 9. If you are a bank trust officer, registered representative, or other employee of a qualified recipient, as defined on page . 10. To contributions and exchanges to a prototype or prototype-like retirement plan sponsored by FMR Corp. or FMR and which is marketed and distributed directly to plan sponsors or participants without any assistance or intervention from any intermediary distribution channel. 11. If you invest through a non-prototype pension or profit-sharing plan that maintains all of its mutual fund assets in Fidelity mutual funds, provided the plan executes a Fidelity non-prototype sales charge waiver agreement confirming its qualification. 12. If you are a registered investment adviser (RIA) purchasing for your discretionary accounts, provided you execute a Fidelity RIA load waiver agreement which specifies certain aggregate minimum and operating provisions. Except for correspondents of National Financial Services Corporation, this waiver is available only for shares purchased directly from Fidelity, and is unavailable if the RIA is part of an organization principally engaged in the brokerage business. 13. If you are a trust institution or bank trust department purchasing for your non-discretionary, non-retirement fiduciary accounts, provided you execute a Fidelity Trust load waiver agreement which specifies certain aggregate minimum and operating provisions. This waiver is available only for shares purchased either directly from Fidelity or through a bank-affiliated broker, and is unavailable if the trust department or institution is part of an organization not principally engaged in banking or trust activities. These waivers must be qualified through FDC in advance. More detailed information about waivers (1), (2), (5), (9), (10), and (12) is contained in the Statement of Additional Information. A representative of your plan or organization should call Fidelity for more information. This prospectus is printed on recycled paper using soy-based inks. FIDELITY CONTRAFUND II A FUND OF FIDELITY HASTINGS STREET TRUST STATEMENT OF ADDITIONAL INFORMATION MARCH 25, 1998 This Statement of Additional Information (SAI) is not a prospectus but should be read in conjunction with the fund's current Prospectus (dated March 25, 1998). Please retain this document for future reference. To obtain a free additional copy of the Prospectus, please call Fidelity at 1-800-544-8888. TABLE OF CONTENTS PAGE Investment Policies and Limitations Portfolio Transactions Valuation Performance Additional Purchase , Exchange and Redemption Information Distributions and Taxes FMR Trustees and Officers Management Contract Distribution and Service Plan Contracts with FMR Affiliates Description of the Trust Appendix INVESTMENT ADVISER Fidelity Management & Research Company (FMR) INVESTMENT SUB-ADVISERS Fidelity Management & Research (U.K.) Inc. (FMR U.K.) Fidelity Management & Research (Far East) Inc. (FMR Far East) DISTRIBUTOR Fidelity Distributors Corporation (FDC) TRANSFER AGENT Fidelity Service Company, Inc. (FSC) ___-ptb-0398 INVESTMENT POLICIES AND LIMITATIONS The following policies and limitations supplement those set forth in the Prospectus. Unless otherwise noted, whenever an investment policy or limitation states a maximum percentage of the fund's assets that may be invested in any security or other asset, or sets forth a policy regarding quality standards, such standard or percentage limitation will be determined immediately after and as a result of the fund's acquisition of such security or other asset. Accordingly, any subsequent change in values, net assets, or other circumstances will not be considered when determining whether the investment complies with the fund's investment policies and limitations. The fund's fundamental investment policies and limitations cannot be changed without approval by a "majority of the outstanding voting securities" (as defined in the Investment Company Act of 1940 ( the 1940 Act)) of the fund. However, except for the fundamental investment limitations listed below, the investment policies and limitations described in this SAI are not fundamental and may be changed without shareholder approval. THE FOLLOWING ARE THE FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS SET FORTH IN THEIR ENTIRETY. THE FUND MAY NOT: (1) with respect to 75% of the fund's total assets, purchase the securities of any issuer (other than securities issued or guaranteed by the U.S. Government or any of its agencies or instrumentalities, or securities of other investment companies) if, as a result, (a) more than 5% of the fund's total assets would be invested in the securities of that issuer, or (b) the fund would hold more than 10% of the outstanding voting securities of that issuer; (2) issue senior securities, except as permitted under the Investment Company Act of 1940; (3) borrow money, except that the fund may borrow money for temporary or emergency purposes (not for leveraging or investment) in an amount not exceeding 33 1/3% of its total assets (including the amount borrowed) less liabilities (other than borrowings). Any borrowings that come to exceed this amount will be reduced within three days (not including Sundays and holidays) to the extent necessary to comply with the 33 1/3% limitation; (4) underwrite securities issued by others, except to the extent that the fund may be considered an underwriter within the meaning of the Securities Act of 1933 in the disposition of restricted securities; (5) purchase the securities of any issuer (other than securities issued or guaranteed by the U.S. Government or any of its agencies or instrumentalities) if, as a result, more than 25% of the fund's total assets would be invested in the securities of companies whose principal business activities are in the same industry; (6) purchase or sell real estate unless acquired as a result of ownership of securities or other instruments (but this shall not prevent the fund from investing in securities or other instruments backed by real estate or securities of companies engaged in the real estate business); (7) purchase or sell physical commodities unless acquired as a result of ownership of securities or other instruments (but this shall not prevent the fund from purchasing or selling options and futures contracts or from investing in securities or other instruments backed by physical commodities); (8) lend any security or make any other loan if, as a result, more than 33 1/3% of its total assets would be lent to other parties, but this limitation does not apply to purchases of debt securities or to repurchase agreements; (9) The fund may, notwithstanding any other fundamental investment policy or limitation, invest all of its assets in the securities of a single open-end management investment company managed by Fidelity Management & Research Company or an affiliate or successor with substantially the same fundamental investment objective, policies, and limitations as the fund. THE FOLLOWING INVESTMENT LIMITATIONS ARE NOT FUNDAMENTAL AND MAY BE CHANGED WITHOUT SHAREHOLDER APPROVAL: (i) The fund does not currently intend to sell securities short, unless it owns or has the right to obtain securities equivalent in kind and amount to the securities sold short, and provided that transactions in futures contracts and options are not deemed to constitute selling securities short. (ii) The fund does not currently intend to purchase securities on margin, except that the fund may obtain such short-term credits as are necessary for the clearance of transactions, and provided that margin payments in connection with futures contracts and options on futures contracts shall not constitute purchasing securities on margin. (iii) The fund may borrow money only (a) from a bank or from a registered investment company or portfolio for which FMR or an affiliate serves as investment adviser or (b) by engaging in reverse repurchase agreements with any party (reverse repurchase agreements are treated as borrowings for purposes of fundamental investment limitation (3)). The fund will not borrow from other funds advised by FMR or its affiliates if total outstanding borrowings immediately after such borrowing would exceed 15% of the fund's total assets. (iv) The fund does not currently intend to purchase any security if, as a result, more than 10% of its net assets would be invested in securities that are deemed to be illiquid because they are subject to legal or contractual restrictions on resale or because they cannot be sold or disposed of in the ordinary course of business at approximately the prices at which they are valued. (v) The fund does not currently intend to lend assets other than securities to other parties, except by (a) lending money (up to 5% of the fund's net assets) to a registered investment company or portfolio for which FMR or an affiliate serves as investment adviser or (b) acquiring loans, loan participations, or other forms of direct debt instruments. (This limitation does not apply to purchases of debt securities or to repurchase agreements.) (vi) The fund does not currently intend to invest all of its assets in the securities of a single open-end management investment company managed by Fidelity Management & Research Company or an affiliate or successor with substantially the same fundamental investment objective, policies, and limitations as the fund. With respect to limitation (iv), if through a change in values, net assets, or other circumstances, the fund were in a position where more than 10% of its net assets was invested in illiquid securities, it would consider appropriate steps to protect liquidity. For the fund's limitations on futures and options transactions, see the section entitled "Limitations on Futures and Options Transactions" on page . The following pages contain more detailed information about types of instruments in which the fund may invest, strategies MFR. may employ in pursuit of the fund's investment objective, and a summary of related risks. MFR. may not buy all of these instruments or use all of these techniques unless it believes that doing so will help the fund achieve its goal. AFFILIATED BANK TRANSACTIONS. A fund may engage in transactions with financial institutions that are, or may be considered to be, "affiliated persons" of the fund under the 1940 Act. These transactions may involve repurchase agreements with custodian banks; short-term obligations of, and repurchase agreements with, the 50 largest U.S. banks (measured by deposits); municipal securities; U.S. Government securities with affiliated financial institutions that are primary dealers in these securities; short-term currency transactions; and short-term borrowings. In accordance with exemptive orders issued by the Securities and Exchange Commission (SEC), the Board of Trustees has established and periodically reviews procedures applicable to transactions involving affiliated financial institutions. CLOSED-END INVESTMENT COMPANIES are investment companies that issue a fixed number of shares which trade on a stock exchange or over-the-counter. Closed-end investment companies are professionally managed and may invest in any type of security. Shares of closed-end investment companies may trade at a premium or a discount to their net asset value. The fund may purchase shares of closed-end investment companies to facilitate investment in certain foreign countries. C O NVERTIBLE SECURITIES are bonds, debentures, notes, preferred stocks or other securities that may be converted or exchanged (by the holder or by the issuer) into shares of the underlying common stock (or cash securities of equivalent value) at a stated exchange ratio. A convertible security may also be called for redemption or conversion by the issuer after a particular date and under certain circumstances (including a specified price) established upon issue. If a convertible security held by a fund is called for redemption or conversion, the fund could required to tender it for redemption, convert it into the underlying common stock, or sell it to a third party. Convertible securities generally have less potential for gain or loss than common stocks. Convertible securities generally provide yields higher than the underlying common stocks, but generally lower than comparable non-convertible securities. Because of this higher yield, convertible securities generally sell at prices above their "conversion value," which is the current market value of the stock to be received upon conversion. The difference between this conversion value and the price of convertible securities will vary over time depending on changes in the value of the underlying common stocks and interest rates. When the underlying common stocks decline in value, convertible securities will tend not to decline to the same extent because of the interest or dividend payments and the repayment of principal at maturity for certain types of convertible securities. However, securities that are convertible other than at the option of the holder generally do not limit the potential for loss to the same extent as securities convertible at the option of the holder. When the underlying common stocks rise in value, the value of convertible securities may also be expected to increase. At the same time, however, the difference between the market value of convertible securities and their conversion value will narrow, which means that the value of convertible securities will generally not increase to the same extent as the value of the underlying common stocks. Because convertible securities may also be interest-rate sensitive, their value may increase as interest rates fall and decrease as interest rates rise. Convertible securities are also subject to credit risk, and are often lower-quality securities. EXPOSURE TO FOREIGN MARKETS. Foreign securities, foreign currencies, and securities issued by U.S. entities with substantial foreign operations may involve significant risks in addition to the risks inherent in U.S. investments. Foreign investments involve risk s relating to local political, economic, regulatory, or social instability, military action or unrest, or adverse diplomatic developments, and may be affected by actions of foreign governments adverse to the interests of U.S. investors. Such actions may include expropriation or nationalization of assets, confiscatory taxation, restrictions on U.S. investment or on the ability to repatriate assets or convert currency into U.S. dollars, or other government intervention. There is no assurance that FMR will be able to anticipate these potential events or counter their effects. In addition, the value of securities denominated in foreign currencies and of dividends and interest paid with respect to such securities will fluctuate based on the relative strength of the U.S. dollar. It is anticipated that in most cases the best available market for foreign securities will be on an exchange or in over-the-counter (OTC) markets located outside of the United States. Foreign stock markets, while growing in volume and sophistication, are generally not as developed as those in the United States, and securities of some foreign issuers may be less liquid and more volatile than securities of comparable U.S. issuers. Foreign security trading , settlement and custodial practices ( including those involving securities settlement where fund assets may be released prior to receipt of payment ) are often less developed than those in U.S. markets, and may result in increased risk or substantial delays in the event of a failed trade or the insolvency of , or breach of duty by, a foreign broker-dealer, securities depository or foreign subcustodian . In addition, the costs associated with foreign invest ments , including withholding taxes, brokerage commissions and custodial costs, are generally higher than with U.S. invest ments . Foreign markets may offer less protection to investors than U.S. markets. Foreign issuers are generally not bound by uniform accounting, auditing, and financial reporting requirements and standards of practice comparable to those applicable to U.S. issuers. Adequate public information on foreign issuers may not be available, and it may be difficult to secure dividends and information regarding corporate actions on a timely basis. In general, there is less overall governmental supervision and regulation of securities exchanges, brokers, and listed companies than in the United States. OTC markets tend to be less regulated than stock exchange markets and, in certain countries, may be totally unregulated. Regulatory enforcement may be influenced by economic or political concerns, and investors may have difficulty enforcing their legal rights in foreign countries. Some foreign securities impose restrictions on transfer within the United States or to U.S. persons. Although securities subject to such transfer restrictions may be marketable abroad, they may be less liquid than foreign securities of the same class that are not subject to such restrictions. American Depositary Receipts (ADRs) as well as other "hybrid" forms of ADRs , including European Depositary Receipts (EDRs) and Global Depositary Receipts (GDRs), are certificates evidencing ownership of shares of a foreign issuer. These certificates are issued by depository banks and generally trade on an established market in the United States or elsewhere. The underlying shares are held in trust by a custodian bank or similar financial institution in the issuer's home country. The depository bank may not have physical custody of the underlying securities at all times and may charge fees for various services, including forwarding dividends and interest and corporate actions. ADRs are alternative s to directly purchasing the underlying foreign securities in their national markets and currencies. However, ADRs continue to be subject to many of the risks associated with investing directly in foreign securities. These risks include foreign exchange risk as well as the political and economic risks of the underlying issuer's country. The risks of foreign investing may be magnified for investments in emerging markets. Security prices in emerging markets can be significantly more volatile than those in more developed markets, reflecting the greater uncertainties of investing in less established markets and economies. In particular, countries with emerging markets may have relatively unstable governments, may present the risks of nationalization of businesses, restrictions on foreign ownership and prohibitions on the repatriation of assets, and may have less protection of property rights than more developed countries. The economies of countries with emerging markets may be based on only a few industries, may be highly vulnerable to changes in local or global trade conditions, and may suffer from extreme and volatile debt burdens or inflation rates. Local securities markets may trade a small number of securities and may be unable to respond effectively to increases in trading volume, potentially making prompt liquidation of holdings difficult or impossible at times. FOREIGN CURRENCY TRANSACTION S. A fund may conduct foreign currency transactions on a spot (i.e., cash) or forward basis (i.e., by entering into forward contracts to purchase or sell foreign currencies). Although foreign exchange dealers generally do not charge a fee for such conversions, they do realize a profit based on the difference between the prices at which they are buying and selling various currencies. Thus, a dealer may offer to sell a foreign currency at one rate, while offering a lesser rate of exchange should the counterparty desire to resell that currency to the dealer. Forward contracts are customized transactions that require a specific amount of a currency to be delivered at a specific exchange rate on a specific date or range of dates in the future. Forward contracts are generally traded in an interbank market directly between currency traders (usually large commercial banks) and their customers. The parties to a forward contract may agree to offset or terminate the contract before its maturity, or may hold the contract to maturity and complete the contemplated currency exchange. A fund may use currency forward contracts for any purpose consistent with its investment objective. The following discussion summarizes the principal currency management strategies involving forward contracts that could be used by a fund. A fund may also use swap agreements, indexed securities, and options and futures contracts relating to foreign currencies for the same purposes. A "settlement hedge" or "transaction hedge" is designed to protect a fund against an adverse change in foreign currency values between the date a security is purchased or sold and the date on which payment is made or received. Entering into a forward contract for the purchase or sale of the amount of foreign currency involved in an underlying security transaction for a fixed amount of U.S. dollars "locks in" the U.S. dollar price of the security. Forward contracts to purchase or sell a foreign currency may also be used by a fund in anticipation of future purchases or sales of securities denominated in foreign currency, even if the specific investments have not yet been selected by FMR. A fund may also use forward contracts to hedge against a decline in the value of existing investments denominated in foreign currency. For example, if a fund owned securities denominated in pounds sterling, it could enter into a forward contract to sell pounds sterling in return for U.S. dollars to hedge against possible declines in the pound's value. Such a hedge, sometimes referred to as a "position hedge," would tend to offset both positive and negative currency fluctuations, but would not offset changes in security values caused by other factors. A fund could also hedge the position by selling another currency expected to perform similarly to the pound sterling. This type of hedge, sometimes referred to as a "proxy hedge," could offer advantages in terms of cost, yield, or efficiency, but generally would not hedge currency exposure as effectively as a direct hedge into U.S. dollars. Proxy hedges may result in losses if the currency used to hedge does not perform similarly to the currency in which the hedged securities are denominated. A fund may enter into forward contracts to shift its investment exposure from one currency into another. This may include shifting exposure from U.S. dollars to a foreign currency, or from one foreign currency to another foreign currency. This type of strategy, sometimes known as a "cross-hedge," will tend to reduce or eliminate exposure to the currency that is sold, and increase exposure to the currency that is purchased, much as if a fund had sold a security denominated in one currency and purchased an equivalent security denominated in another. Cross-hedges protect against losses resulting from a decline in the hedged currency, but will cause a fund to assume the risk of fluctuations in the value of the currency it purchases. Under certain conditions, SEC guidelines require mutual funds to set aside appropriate liquid assets in a segregated custodial account to cover currency forward contracts. As required by SEC guidelines, a fund will segregate assets to cover currency forward contracts, if any, whose purpose is essentially speculative. A fund will not segregate assets to cover forward contracts entered into for hedging purposes, including settlement hedges, position hedges, and proxy hedges. Successful use of currency management strategies will depend on FMR's skill in analyzing currency values. Currency management strategies may substantially change a fund's investment exposure to changes in currency exchange rates and could result in losses to a fund if currencies do not perform as FMR anticipates. For example, if a currency's value rose at a time when FMR had hedged a fund by selling that currency in exchange for dollars, a fund would not participate in the currency's appreciation. If FMR hedges currency exposure through proxy hedges, a fund could realize currency losses from both the hedge and the security position if the two currencies do not move in tandem. Similarly, if FMR increases a fund's exposure to a foreign currency and that currency's value declines, a fund will realize a loss. There is no assurance that FMR's use of currency management strategies will be advantageous to a fund or that it will hedge at appropriate times. FUND'S RIGHTS AS A SHAREHOLDER. The fund does not intend to direct or administer the day-to-day operations of any company. A fund, however, may exercise its rights as a shareholder and may communicate its views on important matters of policy to management, the Board of Directors, and shareholders of a company when FMR determines that such matters could have a significant effect on the value of the fund's investment in the company. The activities in which a fund may engage, either individually or in conjunction with others, may include, among others, supporting or opposing proposed changes in a company's corporate structure or business activities; seeking changes in a company's directors or management; seeking changes in a company's direction or policies; seeking the sale or reorganization of the company or a portion of its assets; or supporting or opposing third - party takeover efforts. This area of corporate activity is increasingly prone to litigation and it is possible that a fund could be involved in lawsuits related to such activities. FMR will monitor such activities with a view to mitigating, to the extent possible, the risk of litigation against a fund and the risk of actual liability if a fund is involved in litigation. No guarantee can be made, however, that litigation against a fund will not be undertaken or liabilities incurred. FUTURES AND OPTIONS. The following paragraphs pertain to futures and options: Asset Coverage for Futures and Options Positions, Combined Positions, Correlation of Price Changes, Futures Contracts, Futures Margin Payments, Limitations on Futures and Options Transactions, Liquidity of Options and Futures Contracts, Options and Futures Relating to Foreign Currencies, OTC Options, Purchasing Put and Call Options, and Writing Put and Call Options. ASSET COVERAGE FOR FUTURES AND OPTIONS POSITIONS. The fund will comply with guidelines established by the SEC with respect to coverage of options and futures strategies by mutual funds and , if the guidelines so require , will set aside appropriate liquid assets in a segregated custodial account in the amount prescribed. Securities held in a segregated account cannot be sold while the futures or option strategy is outstanding, unless they are replaced with other suitable assets. As a result, there is a possibility that segregation of a large percentage of the fund's assets could impede portfolio management or the fund's ability to meet redemption requests or other current obligations. COMBINED POSITIONS involve purchas ing and writ ing options in combination with each other, or in combination with futures or forward contracts, to adjust the risk and return characteristics of the overall position. For example, purchas ing a put option and writ ing a call option on the same underlying instrument would construct a combined position whose risk and return characteristics are similar to selling a futures contract. Another possible combined position would involve writing a call option at one strike price and buying a call option at a lower price, to reduce the risk of the written call option in the event of a substantial price increase. Because combined options positions involve multiple trades, they result in higher transaction costs and may be more difficult to open and close out. CORRELATION OF PRICE CHANGES. Because there are a limited number of types of exchange-traded options and futures contracts, it is likely that the standardized contracts available will not match the fund's current or anticipated investments exactly. A fund may invest in options and futures contracts based on securities with different issuers, maturities, or other characteristics from the securities in which the fund typically invests, which involves a risk that the options or futures position will not track the performance of the fund's other investments. Options and futures prices can also diverge from the prices of their underlying instruments, even if the underlying instruments match a fund's investments well. Options and futures prices are affected by such factors as current and anticipated short-term interest rates, changes in volatility of the underlying instrument, and the time remaining until expiration of the contract, which may not affect security prices the same way. Imperfect correlation may also result from differing levels of demand in the options and futures markets and the securities markets, from structural differences in how options and futures and securities are traded, or from imposition of daily price fluctuation limits or trading halts. A fund may purchase or sell options and futures contracts with a greater or lesser value than the securities it wishes to hedge or intends to purchase in order to attempt to compensate for differences in volatility between the contract and the securities, although this may not be successful in all cases. If price changes in a fund's options or futures positions are poorly correlated with its other investments, the positions may fail to produce anticipated gains or result in losses that are not offset by gains in other investments. FUTURES CONTRACTS. In purchasing a futures contract, the buyer agrees to purchase a specified underlying instrument at a specified future date. In selling a futures contract, the seller agrees to sell a specified underlying instrument at a specified future date. The price at which the purchase and sale will take place is fixed when the buyer and seller enter into the contract. Some currently available futures contracts are based on specific securities, such as U.S. Treasury bonds or notes, and some are based on indices of securities prices, such as the Standard & Poor's 500 Index (S&P 500). Futures can be held until their delivery dates, or can be closed out before then if a liquid secondary market is available. The value of a futures contract tends to increase and decrease in tandem with the value of its underlying instrument. Therefore, purchasing futures contracts will tend to increase a fund's exposure to positive and negative price fluctuations in the underlying instrument, much as if it had purchased the underlying instrument directly. When a fund sells a futures contract, by contrast, the value of its futures position will tend to move in a direction contrary to the market. Selling futures contracts, therefore, will tend to offset both positive and negative market price changes, much as if the underlying instrument had been sold. FUTURES MARGIN PAYMENTS. The purchaser or seller of a futures contract is not required to deliver or pay for the underlying instrument unless the contract is held until the delivery date. However, both the purchaser and seller are required to deposit "initial margin" with a futures broker, known as a futures commission merchant (FCM), when the contract is entered into. Initial margin deposits are typically equal to a percentage of the contract's value. If the value of either party's position declines, that party will be required to make additional "variation margin" payments to settle the change in value on a daily basis. The party that has a gain may be entitled to receive all or a portion of this amount. Initial and variation margin payments do not constitute purchasing securities on margin for purposes of a fund's investment limitations. In the event of the bankruptcy of an FCM that holds margin on behalf of a fund, the fund may be entitled to return of margin owed to it only in proportion to the amount received by the FCM's other customers, potentially resulting in losses to the fund. LIMITATIONS ON FUTURES AND OPTIONS TRANSACTIONS. The fund intends to file a notice of eligibility for exclusion from the definition of the term "commodity pool operator" with the Commodity Futures Trading Commission (CFTC) and the National Futures Association, which regulate trading in the futures markets , before engaging in any purchases or sales of futures contracts or options on futures contracts. The fund intends to comply with Rule 4.5 under the Commodity Exchange Act, which limits the extent to which the fund can commit assets to initial margin deposits and option premiums. In addition, the fund will not: (a) sell futures contracts, purchase put options, or write call options if, as a result, more than 25% of the fund's total assets would be hedged with futures and options under normal conditions; (b) purchase futures contracts or write put options if, as a result, the fund's total obligations upon settlement or exercise of purchased futures contracts and written put options would exceed 25% of its total assets; or (c) purchase call options if, as a result, the current value of option premiums for call options purchased by the fund would exceed 5% of the fund's total assets. These limitations do not apply to options attached to or acquired or traded together with their underlying securities, and do not apply to securities that incorporate features similar to options. The above limitations on the fund's investments in futures contracts and options, and the fund's policies regarding futures contracts and options discussed elsewhere in this SAI, may be changed as regulatory agencies permit. LIQUIDITY OF OPTIONS AND FUTURES CONTRACTS. There is no assurance a liquid secondary market will exist for any particular options or futures contract at any particular time. Options may have relatively low trading volume and liquidity if their strike prices are not close to the underlying instrument's current price. In addition, exchanges may establish daily price fluctuation limits for options and futures contracts, and may halt trading if a contract's price moves upward or downward more than the limit in a given day. On volatile trading days when the price fluctuation limit is reached or a trading halt is imposed, it may be impossible to enter into new positions or close out existing positions. If the secondary market for a contract is not liquid because of price fluctuation limits or otherwise, it could prevent prompt liquidation of unfavorable positions, and potentially could require a fund to continue to hold a position until delivery or expiration regardless of changes in its value. As a result, a fund's access to other assets held to cover its options or futures positions could also be impaired. OPTIONS AND FUTURES RELATING TO FOREIGN CURRENCIES. Currency futures contracts are similar to forward currency exchange contracts, except that they are traded on exchanges (and have margin requirements) and are standardized as to contract size and delivery date. Most currency futures contracts call for payment or delivery in U.S. dollars. The underlying instrument of a currency option may be a foreign currency, which generally is purchased or delivered in exchange for U.S. dollars, or may be a futures contract. The purchaser of a currency call obtains the right to purchase the underlying currency, and the purchaser of a currency put obtains the right to sell the underlying currency. The uses and risks of currency options and futures are similar to options and futures relating to securities or indices, as discussed above. A fund may purchase and sell currency futures and may purchase and write currency options to increase or decrease its exposure to different foreign currencies. Currency options may also be purchased or written in conjunction with each other or with currency futures or forward contracts. Currency futures and options values can be expected to correlate with exchange rates, but may not reflect other factors that affect the value of a fund's investments. A currency hedge, for example, should protect a Yen-denominated security from a decline in the Yen, but will not protect a fund against a price decline resulting from deterioration in the issuer's creditworthiness. Because the value of a fund's foreign-denominated investments changes in response to many factors other than exchange rates, it may not be possible to match the amount of currency options and futures to the value of the fund's investments exactly over time. OTC OPTIONS. Unlike exchange-traded options, which are standardized with respect to the underlying instrument, expiration date, contract size, and strike price, the terms of over-the-counter (OTC) options (options not traded on exchanges) generally are established through negotiation with the other party to the option contract. While this type of arrangement allows the purchaser or writer greater flexibility to tailor an option to its needs, OTC options generally involve greater credit risk than exchange-traded options, which are guaranteed by the clearing organization of the exchanges where they are traded. PURCHASING PUT AND CALL OPTIONS. By purchasing a put option, the purchaser obtains the right (but not the obligation) to sell the option's underlying instrument at a fixed strike price. In return for this right, the purchaser pays the current market price for the option (known as the option premium). Options have various types of underlying instruments, including specific securities, indices of securities prices, and futures contracts. The purchaser may terminate its position in a put option by allowing it to expire or by exercising the option. If the option is allowed to expire, the purchaser will lose the entire premium. If the option is exercise d, the purchaser completes the sale of the underlying instrument at the strike price. A purchaser may also terminate a put option position by closing it out in the secondary market at its current price, if a liquid secondary market exists. The buyer of a typical put option can expect to realize a gain if security prices fall substantially. However, if the underlying instrument's price does not fall enough to offset the cost of purchasing the option, a put buyer can expect to suffer a loss (limited to the amount of the premium, plus related transaction costs). The features of call options are essentially the same as those of put options, except that the purchaser of a call option obtains the right to purchase, rather than sell, the underlying instrument at the option's strike price. A call buyer typically attempts to participate in potential price increases of the underlying instrument with risk limited to the cost of the option if security prices fall. At the same time, the buyer can expect to suffer a loss if security prices do not rise sufficiently to offset the cost of the option. WRITING PUT AND CALL OPTIONS. T he write r of a put or call option takes the opposite side of the transaction from the option's purchaser. In return for receipt of the premium, the writer assumes the obligation to pay the strike price for the option's underlying instrument if the other party to the option chooses to exercise it. The writer may seek to terminate a position in a put option before exercise by closing out the option in the secondary market at its current price. If the secondary market is not liquid for a put option, however, the writer must continue to be prepared to pay the strike price while the option is outstanding, regardless of price changes, and must continue to set aside assets to cover its position. When writing an option on a futures contract, a fund will be required to make margin payments to an FCM as described above for futures contracts. If security prices rise, a put writer would generally expect to profit, although its gain would be limited to the amount of the premium it received. If security prices remain the same over time, it is likely that the writer will also profit, because it should be able to close out the option at a lower price. If security prices fall, the put writer would expect to suffer a loss. This loss should be less than the loss from purchasing the underlying instrument directly, however, because the premium received for writing the option should mitigate the effects of the decline. Writing a call option obligates the writer to sell or deliver the option's underlying instrument, in return for the strike price, upon exercise of the option. The characteristics of writing call options are similar to those of writing put options, except that writing calls generally is a profitable strategy if prices remain the same or fall. Through receipt of the option premium, a call writer mitigates the effects of a price decline. At the same time, because a call writer must be prepared to deliver the underlying instrument in return for the strike price, even if its current value is greater, a call writer gives up some ability to participate in security price increases. ILLIQUID INVESTMENTS are investments that cannot be sold or disposed of in the ordinary course of business at approximately the prices at which they are valued. Under the supervision of the Board of Trustees, FMR determines the liquidity of a fund's investments and, through reports from FMR, the Board monitors investments in illiquid instruments. In determining the liquidity of a fund's investments, FMR may consider various factors, including (1) the frequency of trades and quotations, (2) the number of dealers and prospective purchasers in the marketplace, (3) dealer undertakings to make a market, (4) the nature of the security (including any demand or tender features), and (5) the nature of the marketplace for trades (including the ability to assign or offset the fund's rights and obligations relating to the investment). Investments currently considered by FMR to be illiquid include repurchase agreements not entitling the holder to re payment of principal and payment of interest within seven days, over-the-counter options, and non-government stripped fixed-rate mortgage-backed securities. Also, FMR may determine some restricted securities, government-stripped fixed-rate mortgage-backed securities, loans and other direct debt instruments, emerging market securities, and swap agreements to be illiquid. However, with respect to over-the-counter options a fund writes, all or a portion of the value of the underlying instrument may be illiquid depending on the assets held to cover the option and the nature and terms of any agreement the fund may have to close out the option before expiration. In the absence of market quotations, illiquid investments are priced at fair value as determined in good faith by a committee appointed by the Board of Trustees. INDEXED SECURITIES are instruments whose prices are indexed to the prices of other securities, securities indices, currencies, or other financial indicators. Indexed securities typically, but not always, are debt securities or deposits whose value at maturity or coupon rate is determined by reference to a specific instrument or statistic. Currency-indexed securities typically are short-term to intermediate-term debt securities whose maturity values or interest rates are determined by reference to the values of one or more specified foreign currencies, and may offer higher yields than U.S. dollar-denominated securities. Currency-indexed securities may be positively or negatively indexed; that is, their maturity value may increase when the specified currency value increases, resulting in a security that performs similarly to a foreign-denominated instrument, or their maturity value may decline when foreign currencies increase, resulting in a security whose price characteristics are similar to a put on the underlying currency. Currency-indexed securities may also have prices that depend on the values of a number of different foreign currencies relative to each other. The performance of indexed securities depends to a great extent on the performance of the security, currency, or other instrument to which they are indexed, and may also be influenced by interest rate changes in the United States and abroad. Indexed securities may be more volatile than the underlying instruments. I ndexed securities are also subject to the credit risks associated with the issuer of the security, and their values may decline substantially if the issuer's creditworthiness deteriorates. Recent issuers of indexed securities have included banks, corporations, and certain U.S. Government agencies. INTERFUND BORROWING AND LENDING PROGRAM. Pursuant to an exemptive order issued by the SEC, a fund may lend money to, and borrow money from, other funds advised by FMR or its affiliates. A fund will lend through the program only when the returns are higher than those available from an investment in repurchase agreements, and will borrow through the program only when the costs are equal to or lower than the cost of bank loans. Interfund loans and borrowings normally extend overnight, but can have a maximum duration of seven days. Loans may be called on one day's notice. A fund may have to borrow from a bank at a higher interest rate if an interfund loan is called or not renewed. Any delay in repayment to a lending fund could result in a lost investment opportunity or additional borrowing costs. LOANS AND OTHER DIRECT DEBT INSTRUMENTS. Direct debt instruments are interests in amounts owed by a corporate, governmental, or other borrower to lenders or lending syndicates (loans and loan participations), to suppliers of goods or services (trade claims or other receivables), or to other parties. Direct debt instruments involve a risk of loss in case of default or insolvency of the borrower and may offer less legal protection to the purchaser in the event of fraud or misrepresentation. In addition, loan participations involve a risk of insolvency of the lending bank or other financial intermediary. Direct debt instruments may also include standby financing commitments that obligate the purchaser to supply additional cash to the borrower on demand. LOWER-QUALITY DEBT SECURITIES. Lower-quality debt securities have poor protection with respect to the payment of interest and repayment of principal, or may be in default. These securities are often considered to be speculative and involve greater risk of loss or price changes due to changes in the issuer's capacity to pay. The market prices of lower-quality debt securities may fluctuate more than those of higher-quality debt securities and may decline significantly in periods of general economic difficulty, which may follow periods of rising interest rates. While the market for high-yield corporate debt securities has been in existence for many years and has weathered previous economic downturns, the 1980s brought a dramatic increase in the use of such securities to fund highly leveraged corporate acquisitions and restructurings. Past experience may not provide an accurate indication of the future performance of the high-yield bond market, especially during periods of economic recession. The market for lower-quality debt securities may be thinner and less active than that for higher-quality debt securities, which can adversely affect the prices at which the former are sold. If market quotations are not available, lower-quality debt securities will be valued in accordance with procedures established by the Board of Trustees, including the use of outside pricing services. Judgment plays a greater role in valuing high-yield debt securities than is the case for securities for which more external sources for quotations and last-sale information are available. Adverse publicity and changing investor perceptions may affect the liquidity of lower-quality debt securities and the ability of outside pricing services to value lower-quality debt securities. Since the risk of default is higher for lower-quality debt securities, FMR's research and credit analysis are an especially important part of managing securities of this type. FMR will attempt to identify those issuers of high-yielding securities whose financial condition is adequate to meet future obligations, has improved, or is expected to improve in the future. FMR's analysis focuses on relative values based on such factors as interest or dividend coverage, asset coverage, earnings prospects, and the experience and managerial strength of the issuer. A fund may choose, at its expense or in conjunction with others, to pursue litigation or otherwise to exercise its rights as a security holder to seek to protect the interests of security holders if it determines this to be in the best interest of the fund's shareholders. REAL ESTATE INVESTMENT TRUSTS. Equity real estate investment trusts own real estate properties, while mortgage real estate investment trusts make construction, development, and long-term mortgage loans. Their value may be affected by changes in the value of the underlying property of the trusts, the creditworthiness of the issuer, property taxes, interest rates, and tax and regulatory requirements, such as those relating to the environment. Both types of trusts are dependent upon management skill, are not diversified, and are subject to heavy cash flow dependency, defaults by borrowers, self-liquidation, and the possibility of failing to qualify for tax-free status of income under the Internal Revenue Code and failing to maintain exemption from the 1940 Act. REPURCHASE AGREEMENTS. In a repurchase agreement, a fund purchases a security and simultaneously commits to sell that security back to the original seller at an agreed-upon price. The resale price reflects the purchase price plus an agreed-upon incremental amount which is unrelated to the coupon rate or maturity of the purchased security. As protection against the risk that the original seller will not fulfill its obligation, the securities are held in a separate account at a bank, marked-to-market daily, and maintained at a value at least equal to the sale price plus the accrued incremental amount. While it does not presently appear possible to eliminate all risks from these transactions (particularly the possibility that the value of the underlying security will be less than the resale price, as well as delays and costs to a fund in connection with bankruptcy proceedings), the fund will engage in repurchase agreement transactions with parties whose creditworthiness has been reviewed and found satisfactory by FMR. RESTRICTED SECURITIES generally can be sold in privately negotiated transactions, pursuant to an exemption from registration under the Securities Act of 1933, or in a registered public offering. Where registration is required, a fund may be obligated to pay all or part of the registration expense and a considerable period may elapse between the time it decides to seek registration and the time it may be permitted to sell a security under an effective registration statement. If, during such a period, adverse market conditions were to develop, a fund might obtain a less favorable price than prevailed when it decided to seek registration of the security. REVERSE REPURCHASE AGREEMENTS. In a reverse repurchase agreement, a fund sells a security to another party, such as a bank or broker-dealer, in return for cash and agrees to repurchase that security at a n agreed-upon price and time. While a reverse repurchase agreement is outstanding, a fund will maintain appropriate liquid assets in a segregated custodial account to cover its obligation under the agreement. The fund will enter into reverse repurchase agreements with parties whose creditworthiness has been reviewed and found satisfactory by FMR. Such transactions may increase fluctuations in the market value of fund assets and may be viewed as a form of leverage. SECURITIES LENDING. A fund may lend securities to parties such as broker-dealers or institutional investors, including Fidelity Brokerage Services, Inc. (FBSI). FBSI is a member of the New York Stock Exchange and a subsidiary of FMR Corp. Securities lending allows a fund to retain ownership of the securities loaned and, at the same time, to earn additional income. Since there may be delays in the recovery of loaned securities, or even a loss of rights in collateral supplied should the borrower fail financially, loans will be made only to parties deemed by FMR to be of good standing. Furthermore, they will only be made if, in FMR's judgment, the consideration to be earned from such loans would justify the risk. FMR understands that it is the current view of the SEC Staff that a fund may engage in loan transactions only under the following conditions: (1) the fund must receive 100% collateral in the form of cash or cash equivalents (e.g., U.S. Treasury bills or notes) from the borrower; (2) the borrower must increase the collateral whenever the market value of the securities loaned (determined on a daily basis) rises above the value of the collateral; (3) after giving notice, the fund must be able to terminate the loan at any time; (4) the fund must receive reasonable interest on the loan or a flat fee from the borrower, as well as amounts equivalent to any dividends, interest, or other distributions on the securities loaned and to any increase in market value; (5) the fund may pay only reasonable custodian fees in connection with the loan; and (6) the Board of Trustees must be able to vote proxies on the securities loaned, either by terminating the loan or by entering into an alternative arrangement with the borrower. Cash received through loan transactions may be invested in other eligible securities . Investing this cash subjects that investment, as well as the security loaned, to market forces (i.e., capital appreciation or depreciation). SHORT SALES "AGAINST THE BOX." A fund may sell securities short when it owns or has the right to obtain securities equivalent in kind or amount to the securities sold short. Such short sales are known as short sales "against the box." If a fund enters into a short sale against the box, it will be required to set aside securities equivalent in kind and amount to the securities sold short (or securities convertible or exchangeable into such securities) and will be required to hold such securities while the short sale is outstanding. The fund will incur transaction costs, including interest expenses, in connection with opening, maintaining, and closing short sales against the box. SWAP AGREEMENTS. Swap agreements can be individually negotiated and structured to include exposure to a variety of different types of investments or market factors. Depending on their structure, swap agreements may increase or decrease a fund's exposure to long- or short-term interest rates (in the United States or abroad), foreign currency values, mortgage securities, corporate borrowing rates, or other factors such as security prices or inflation rates. Swap agreements can take many different forms and are known by a variety of names. In a typical cap or floor agreement, one party agrees to make payments only under specified circumstances, usually in return for payment of a fee by the other party. For example, the buyer of an interest rate cap obtains the right to receive payments to the extent that a specified interest rate exceeds an agreed-upon level, while the seller of an interest rate floor is obligated to make payments to the extent that a specified interest rate falls below an agreed-upon level. An interest rate collar combines elements of buying a cap and selling a floor. Swap agreements will tend to shift a fund's investment exposure from one type of investment to another. For example, if the fund agreed to exchange payments in dollars for payments in foreign currency, the swap agreement would tend to decrease the fund's exposure to U.S. interest rates and increase its exposure to foreign currency and interest rates. Caps and floors have an effect similar to buying or writing options. Depending on how they are used, swap agreements may increase or decrease the overall volatility of a fund's investments and its share price. The most significant factor in the performance of swap agreements is the change in the specific interest rate, currency, or other factors that determine the amounts of payments due to and from a fund. If a swap agreement calls for payments by the fund, the fund must be prepared to make such payments when due. In addition, if the counterparty's creditworthiness declined, the value of a swap agreement would be likely to decline, potentially resulting in losses. A fund may be able to eliminate its exposure under a swap agreement either by assignment or other disposition, or by entering into an offsetting swap agreement with the same party or a similarly creditworthy party. A fund will maintain appropriate liquid assets in a segregated custodial account to cover its current obligations under swap agreements. If a fund enters into a swap agreement on a net basis, it will segregate assets with a daily value at least equal to the excess, if any, of the fund's accrued obligations under the swap agreement over the accrued amount the fund is entitled to receive under the agreement. If a fund enters into a swap agreement on other than a net basis, it will segregate assets with a value equal to the full amount of the fund's accrued obligations under the agreement. WARRANTS. Warrants are instruments which entitle the holder to buy an equity security at a specific price for a specific period of time. Changes in the value of a warrant do not necessarily correspond to changes in the value of its underlying security. The price of a warrant may be more volatile than the price of its underlying security, and a warrant may offer greater potential for capital appreciation as well as capital loss. Warrants do not entitle a holder to dividends or voting rights with respect to the underlying security and do not represent any rights in the assets of the issuing company. A warrant ceases to have value if it is not exercised prior to its expiration date. These factors can make warrants more speculative than other types of investments. PORTFOLIO TRANSACTIONS All orders for the purchase or sale of portfolio securities are placed on behalf of the fund by FMR pursuant to authority contained in the management contract. If FMR grants investment management authority to the sub-advisers (see the section entitled "Management Contract"), the sub-advisers are authorized to place orders for the purchase and sale of portfolio securities, and will do so in accordance with the policies described below. FMR is also responsible for the placement of transaction orders for other investment companies and accounts for which it or its affiliates act as investment adviser. In selecting broker-dealers, subject to applicable limitations of the federal securities laws, FMR considers various relevant factors, including, but not limited to: the size and type of the transaction; the nature and character of the markets for the security to be purchased or sold; the execution efficiency, settlement capability, and financial condition of the broker-dealer firm; the broker-dealer's execution services rendered on a continuing basis; the reasonableness of any commissions; and arrangements for payment of fund expenses. Generally, commissions for investments traded on foreign exchanges will be higher than for investments traded on U.S. exchanges and may not be subject to negotiation. The fund may execute portfolio transactions with broker-dealers who provide research and execution services to the fund or other accounts over which FMR or its affiliates exercise investment discretion. Such services may include advice concerning the value of securities; the advisability of investing in, purchasing, or selling securities; and the availability of securities or the purchasers or sellers of securities. In addition, such broker-dealers may furnish analyses and reports concerning issuers, industries, securities, economic factors and trends, portfolio strategy, and performance of accounts; effect securities transactions, and perform functions incidental thereto (such as clearance and settlement). The selection of such broker-dealers generally is 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 fund may be useful to FMR in rendering investment management services to the fund or its other clients, and conversely, such research provided by broker-dealers who have executed transaction orders on behalf of other FMR clients may be useful to FMR in carrying out its obligations to the fund. The receipt of such research has not reduced FMR's normal independent research activities; however, it enables FMR to avoid the additional expenses that could be incurred if FMR tried to develop comparable information through its own efforts. 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 fund 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 fund or shares of other Fidelity funds to the extent permitted by law. FMR may use research services provided by and place agency transactions with National Financial Services Corporation (NFSC) and Fidelity Brokerage Services (Japan), LLC (FBS J ), indirect subsidiaries of FMR Corp., if the commissions are fair, reasonable, and comparable to commissions charged by non-affiliated, qualified brokerage firms for similar services. Prior to December 9, 1997, FMR used research services provided by and placed agency transactions with Fidelity Brokerage Services (FBS), an indirect subsidiary of FMR Corp. FMR may allocate brokerage transactions to broker-dealers who have entered into arrangements with FMR under which the broker-dealer allocates a portion of the commissions paid by the fund toward payment of the fund's expenses, such as transfer agent fees or custodian fees. The transaction quality must, however, be comparable to those of other qualified broker-dealers. Section 11(a) of the Securities Exchange Act of 1934 prohibits members of national securities exchanges from executing exchange transactions for accounts which they or their affiliates manage, unless certain requirements are satisfied. Pursuant to such requirements, the Board of Trustees has authorized NFSC to execute portfolio transactions on national securities exchanges in accordance with approved procedures and applicable SEC rules. The Trustees periodically review FMR's performance of its responsibilities in connection with the placement of portfolio transactions on behalf of the fund and review the commissions paid by the fund over representative periods of time to determine if they are reasonable in relation to the benefits to the fund. The fund's annualized turnover rate for its first fiscal period is not expected to exceed 200%. Because a high turnover rate increases transaction costs and may increase taxable gains, FMR carefully weighs the anticipated benefits of short-term investing against these consequences. From time to time the Trustees will review whether the recapture for the benefit of the fund of some portion of the brokerage commissions or similar fees paid by the fund on portfolio transactions is legally permissible and advisable. The fund seeks to recapture soliciting broker-dealer fees on the tender of portfolio securities, but at present no other recapture arrangements are in effect. The Trustees intend to continue to review whether recapture opportunities are available and are legally permissible and, if so, to determine in the exercise of their business judgment whether it would be advisable for the fund to seek such recapture. Although the Trustees and officers of the fund are substantially the same as those of other funds managed by FMR, investment decisions for the fund are made independently from those of other funds managed by FMR or accounts managed by FMR affiliates. It sometimes happens that the same security is held in the portfolio of more than one of these funds or accounts. Simultaneous transactions are inevitable when several funds and accounts are managed by the same investment adviser, particularly when the same security is suitable for the investment objective of more than one fund or account. When two or more funds are simultaneously engaged in the purchase or sale of the same security, the prices and amounts are allocated in accordance with procedures believed to be appropriate and equitable for each fund. In some cases this system could have a detrimental effect on the price or value of the security as far as the fund is concerned. In other cases, however, the ability of the fund to participate in volume transactions will produce better executions and prices for the fund. It is the current opinion of the Trustees that the desirability of retaining FMR as investment adviser to the fund outweighs any disadvantages that may be said to exist from exposure to simultaneous transactions. VALUATION FSC normally determines the fund's NAV as of the close of the New York Stock Exchange (NYSE) (normally 4:00 p.m. Eastern time). The valuation of portfolio securities is determined as of this time for the purpose of computing the fund's NAV. Portfolio securities are valued by various methods depending on the primary market or exchange on which they trade. Most equity securities for which the primary market is the United States are valued at last sale price or, if no sale has occurred, at the closing bid price. Most equity securities for which the primary market is outside the United States are valued using the official closing price or the last sale price in the principal market in which they are traded. If the last sale price (on the local exchange) is unavailable, the last evaluated quote or last bid price normally is used. Securities of other open-end investment companies are valued at their respective NAVs. Fixed-income securities and other assets for which market quotations are readily available may be valued at market values determined by such securities' most recent bid prices (sales prices if the principal market is an exchange) in the principal market in which they normally are traded, as furnished by recognized dealers in such securities or assets. Or, fixed-income securities and convertible securities may be valued on the basis of information furnished by a pricing service that uses a valuation matrix which incorporates both dealer-supplied valuations and electronic data processing techniques. Use of pricing services has been approved by the Board of Trustees. A number of pricing services are available, and the fund may use various pricing services or discontinue the use of any pricing service. Futures contracts and options are valued on the basis of market quotations, if available. Foreign securities are valued based on prices furnished by independent brokers or quotation services which express the value of securities in their local currency. FSC gathers all exchange rates daily at the close of the NYSE using the last quoted price on the local currency and then translates the value of foreign securities from their local currencies into U.S. dollars. Any changes in the value of forward contracts due to exchange rate fluctuations and days to maturity are included in the calculation of NAV. If an extraordinary event that is expected to materially affect the value of a portfolio security occurs after the close of an exchange on which that security is traded, then that security will be valued as determined in good faith by a committee appointed by the Board of Trustees. Short-term securities with remaining maturities of sixty days or less for which market quotations and information furnished by a pricing service are not readily available are valued either at amortized cost or at original cost plus accrued interest, both of which approximate current value. In addition, securities and other assets for which there is no readily available market value may be valued in good faith by a committee appointed by the Board of Trustees. The procedures set forth above need not be used to determine the value of the securities owned by the fund if, in the opinion of a committee appointed by the Board of Trustees, some other method would more accurately reflect the fair market value of such securities. PERFORMANCE The fund may quote performance in various ways. All performance information supplied by the fund in advertising is historical and is not intended to indicate future returns. The fund's share price, yield, and total return fluctuate in response to market conditions and other factors, and the value of fund shares when redeemed may be more or less than their original cost. TOTAL RETURN CALCULATIONS. Total returns quoted in advertising reflect all aspects of the fund's return, including the effect of reinvesting dividends and capital gain distributions, and any change in the fund's NAV over a stated period. Average annual total returns are calculated by determining the growth or decline in value of a hypothetical historical investment in the fund over a stated period, and then calculating the annually compounded percentage rate that would have produced the same result if the rate of growth or decline in value had been constant over the period. For example, a cumulative total return of 100% over ten years would produce an average annual total return of 7.18%, which is the steady annual rate of return that would equal 100% growth on a compounded basis in ten years. Average annual total returns covering periods of less than one year are calculated by determining the fund's total return for the period, extending that return for a full year (assuming that return remains constant over the year), and quoting the result as an annual return. While average annual total returns are a convenient means of comparing investment alternatives, investors should realize that the fund's performance is not constant over time, but changes from year to year, and that average annual total returns represent averaged figures as opposed to the actual year-to-year performance of the fund. In addition to average annual total returns, the fund may quote unaveraged or cumulative total returns reflecting the simple change in value of an investment over a stated period. Average annual and cumulative total returns may be quoted as a percentage or as a dollar amount, and may be calculated for a single investment, a series of investments, or a series of redemptions, over any time period. Total returns may be broken down into their components of income and capital (including capital gains and changes in share price) in order to illustrate the relationship of these factors and their contributions to total return. Total returns may be quoted on a before-tax or after-tax basis and may be quoted with or without taking the fund's 3.00% maximum sales charge into account. Excluding the fund's sales charge from a total return calculation produces a higher total return figure. Total returns, yields, and other performance information may be quoted numerically or in a table, graph, or similar illustration. NET ASSET VALUE. Charts and graphs using the fund's net asset values, adjusted net asset values, and benchmark indices may be used to exhibit performance. An adjusted NAV includes any distributions paid by the fund and reflects all elements of its return. Unless otherwise indicated, the fund's adjusted NAVs are not adjusted for sales charges, if any. MOVING AVERAGES . The fund may illustrate performance using moving averages. A long-term moving average is the average of each week's adjusted closing NAV for a specified period. A short-term moving average is the average of each day's adjusted closing NAV for a specified period. Moving Average Activity Indicators combine adjusted closing NAVs from the last business day of each week with moving averages for a specified period to produce indicators showing when an NAV has crossed, stayed above, or stayed below its moving average. PERFORMANCE COMPARISONS. The fund's performance may be compared to the performance of other mutual funds in general, or to the performance of particular types of mutual funds. These comparisons may be expressed as mutual fund rankings prepared by Lipper Analytical Services, Inc. (Lipper), an independent service located in Summit, New Jersey that monitors the performance of mutual funds. Generally, Lipper rankings are based on total return, assume reinvestment of distributions, do not take sales charges or trading fees into consideration, and are prepared without regard to tax consequences. In addition to the mutual fund rankings, the fund's performance may be compared to stock, bond, and money market mutual fund performance indices prepared by Lipper or other organizations. When comparing these indices, it is important to remember the risk and return characteristics of each type of investment. For example, while stock mutual funds may offer higher potential returns, they also carry the highest degree of share price volatility. Likewise, money market funds may offer greater stability of principal, but generally do not offer the higher potential returns available from stock mutual funds. From time to time, the fund's performance may also be compared to other mutual funds tracked by financial or business publications and periodicals. For example, the fund may quote Morningstar, Inc. in its advertising materials. Morningstar, Inc. is a mutual fund rating service that rates mutual funds on the basis of risk-adjusted performance. Rankings that compare the performance of Fidelity funds to one another in appropriate categories over specific periods of time may also be quoted in advertising. The fund's performance may also be compared to that of a benchmark index representing the universe of securities in which the fund may invest. The total return of a benchmark index reflects reinvestment of all dividends and capital gains paid by securities included in the index. Unlike the fund's returns, however, the index returns do not reflect brokerage commissions, transaction fees, or other costs of investing directly in the securities included in the index. The fund may compare its performance to that of the Standard & Poor's 500 Index, a widely recognized, unmanaged index of common stocks. The fund may be compared in advertising to Certificates of Deposit (CDs) or other investments issued by banks or other depository institutions. Mutual funds differ from bank investments in several respects. For example, the fund may offer greater liquidity or higher potential returns than CDs, the fund does not guarantee your principal or your return, and fund shares are not FDIC insured. Fidelity may provide information designed to help individuals understand their investment goals and explore various financial strategies. Such information may include information about current economic, market, and political conditions; materials that describe general principles of investing, such as asset allocation, diversification, risk tolerance, and goal setting; questionnaires designed to help create a personal financial profile; worksheets used to project savings needs based on assumed rates of inflation and hypothetical rates of return; and action plans offering investment alternatives. Materials may also include discussions of Fidelity's asset allocation funds and other Fidelity funds, products, and services. Ibbotson Associates of Chicago, Illinois (Ibbotson) provides historical returns of the capital markets in the United States, including common stocks, small capitalization stocks, long-term corporate bonds, intermediate-term government bonds, long-term government bonds, Treasury bills, the U.S. rate of inflation (based on the Consumer Price Index), and combinations of various capital markets. The performance of these capital markets is based on the returns of different indices. Fidelity funds may use the performance of these capital markets in order to demonstrate general risk-versus-reward investment scenarios. Performance comparisons may also include the value of a hypothetical investment in any of these capital markets. The risks associated with the security types in any capital market may or may not correspond directly to those of the funds. Ibbotson calculates total returns in the same method as the funds. The funds may also compare performance to that of other compilations or indices that may be developed and made available in the future. In advertising materials, Fidelity may reference or discuss its products and services, which may include other Fidelity funds; retirement investing; brokerage products and services; model portfolios or allocations; saving for college or other goals; and charitable giving. In addition, Fidelity may quote or reprint financial or business publications and periodicals as they relate to current economic and political conditions, fund management, portfolio composition, investment philosophy, investment techniques, the desirability of owning a particular mutual fund, and Fidelity services and products. Fidelity may also reprint, and use as advertising and sales literature, articles from Fidelity Focus(Registered trademark), a quarterly magazine provided free of charge to Fidelity fund shareholders. The fund may present its fund number, Quotron(trademark) number, and CUSIP number, and discuss or quote its current portfolio manager. VOLATILITY. The fund may quote various measures of volatility and benchmark correlation in advertising. In addition, the fund may compare these measures to those of other funds. Measures of volatility seek to compare the fund's historical share price fluctuations or total returns to those of a benchmark. Measures of benchmark correlation indicate how valid a comparative benchmark may be. All measures of volatility and correlation are calculated using averages of historical data. MOMENTUM INDICATORS indicate the fund's price movements over specific periods of time. Each point on the momentum indicator represents the fund's percentage change in price movements over that period. The fund may advertise examples of the effects of periodic investment plans, including the principle of dollar cost averaging. In such a program, an investor invests a fixed dollar amount in a fund at periodic intervals, thereby purchasing fewer shares when prices are high and more shares when prices are low. While such a strategy does not assure a profit or guard against loss in a declining market, the investor's average cost per share can be lower than if fixed numbers of shares are purchased at the same intervals. In evaluating such a plan, investors should consider their ability to continue purchasing shares during periods of low price levels. The fund may be available for purchase through retirement plans or other programs offering deferral of, or exemption from, income taxes, which may produce superior after-tax returns over time. For example, a $1,000 investment earning a taxable return of 10% annually would have an after-tax value of $1,949 after ten years, assuming tax was deducted from the return each year at a 31% rate. An equivalent tax-deferred investment would have an after-tax value of $2,100 after ten years, assuming tax was deducted at a 31% rate from the tax-deferred earnings at the end of the ten-year period. As of January 31, 1998, FMR advised over $ 31 billion in tax-free fund assets, $ 102 billion in money market fund assets, $ 398 billion in equity fund assets, $ 69 billion in international fund assets, and $ 27 billion in Spartan fund assets. The fund may reference the growth and variety of money market mutual funds and the adviser's innovation and participation in the industry. The equity funds under management figure represents the largest amount of equity fund assets under management by a mutual fund investment adviser in the United States, making FMR America's leading equity (stock) fund manager. FMR, its subsidiaries, and affiliates maintain a worldwide information and communications network for the purpose of researching and managing investments abroad. ADDITIONAL PURCHASE , EXCHANGE AND REDEMPTION INFORMATION Pursuant to Rule 22d-1 under the 1940 Act, FDC exercises its right to waive the fund's front-end sales charge on shares acquired through reinvestment of dividends and capital gain distributions or in connection with a fund's merger with or acquisition of any investment company or trust. In addition, FDC has chosen to waive the fund's front-end sales charge in certain instances due to sales efficiencies and competitive considerations . The sales charge will not apply: 1. to shares purchased in connection with an employee benefit plan (including the Fidelity-sponsored 403(b) and corporate IRA programs but otherwise as defined in the Employee Retirement Income Security Act) maintained by a U.S. employer and having more than 200 eligible employees, or a minimum of $3,000,000 in plan assets invested in Fidelity mutual funds, or as part of an employee benefit plan maintained by a U.S. employer that is a member of a parent-subsidiary group of corporations (within the meaning of Section 1563(a)(1) of the Internal Revenue Code, with "50%" substituted for "80%") any member of which maintains an employee benefit plan having more than 200 eligible employees, or a minimum of $3,000,000 in plan assets invested in Fidelity mutual funds, or as part of an employee benefit plan maintained by a non-U.S. employer having 200 or more eligible employees, or a minimum of $3,000,000 in assets invested in Fidelity mutual funds, the assets of which are held in a bona fide trust for the exclusive benefit of employees participating therein; 2. to shares purchased by an insurance company separate account used to fund annuity contracts purchased by employee benefit plans (including 403(b) programs, but otherwise as defined in the Employee Retirement Income Security Act), which, in the aggregate, have either more than 200 eligible employees or a minimum of $3,000,000 in assets invested in Fidelity funds; 3. to shares in a Fidelity account purchased (including purchases by exchange) with the proceeds of a distribution from an employee benefit plan provided that: (i) at the time of the distribution, the employer, or an affiliate (as described in exemption 1 above) of such employer, maintained at least one employee benefit plan that qualified for exemption 1 and that had at least some portion of its assets invested in one or more mutual funds advised by FMR, or in one or more accounts or pools advised by Fidelity Management Trust Company; and (ii) either (a) the distribution is transferred from the plan to a Fidelity IRA account within 60 days from the date of the distribution or (b) the distribution is transferred directly from the plan into another Fidelity account; 4. to shares purchased by a charitable organization (as defined for purposes of Section 501(c)(3) of the Internal Revenue Code) investing $100,000 or more; 5. to shares purchased for a charitable remainder trust or life income pool established for the benefit of a charitable organization (as defined for purposes of Section 501(c)(3) of the Internal Revenue Code); 6. to shares purchased by an investor participating in the Fidelity Trust Portfolios program (these investors must make initial investments of $100,000 or more in the Trust Portfolios funds and must, during the initial six-month period, reach and maintain an aggregate balance of at least $500,000 in all accounts and subaccounts purchased through the Trust Portfolios program); 7. to shares purchased by a mutual fund for which FMR or an affiliate serves as investment manager; 8. to shares purchased through Portfolio Advisory Services or Fidelity Charitable Advisory Services; 9. to shares purchased by a current or former Trustee or officer of a Fidelity fund or a current or retired officer, director, or regular employee of FMR Corp. or Fidelity International Limited or their direct or indirect subsidiaries (a Fidelity Trustee or employee), the spouse of a Fidelity Trustee or employee, a Fidelity Trustee or employee acting as custodian for a minor child, or a person acting as trustee of a trust for the sole benefit of the minor child of a Fidelity Trustee or employee; 10. to shares purchased by a bank trust officer, registered representative, or other employee of a qualified recipient. Qualified recipients are securities dealers or other entities, including banks and other financial institutions, who have sold the fund's shares under special arrangements in connection with FDC's sales activities; 11. to shares purchased by contributions and exchanges to the following prototype or prototype-like retirement plans sponsored by FMR Corp. or FMR and that are marketed and distributed directly to plan sponsors or participants without any intervention or assistance from any intermediary distribution channel: The Fidelity Traditional IRA, The Fidelity Roth IRA, The Fidelity Roth Conversion IRA, The Fidelity Rollover IRA, The Fidelity SEP-IRA and SARSEP, The Fidelity SIMPLE IRA, The Fidelity Retirement Plan, Fidelity Defined Benefit Plan, The Fidelity Group IRA, The Fidelity 403(b) Program, The Fidelity Investments 401(a) Prototype Plan for Tax-Exempt Employers, and The CORPORATEplan for Retirement (Profit Sharing and Money Purchase Plan); 12. to shares purchased as part of a pension or profit-sharing plan as defined in Section 401(a) of the Internal Revenue Code that maintains all of its mutual fund assets in Fidelity mutual funds, provided the plan executes a Fidelity non-prototype sales charge waiver request form confirming its qualification; 13. to shares purchased by a registered investment adviser (RIA) for his or her discretionary accounts, provided he or she executes a Fidelity RIA load waiver agreement which specifies certain aggregate minimum and operating provisions. This waiver is available only for shares purchased directly from Fidelity, without a broker, unless purchased through a brokerage firm which is a correspondent of National Financial Services Corporation (NFSC). The waiver is unavailable, however, if the RIA is part of an organization principally engaged in the brokerage business, unless the brokerage firm in the organization is an NFSC correspondent; or 14. to shares purchased by a trust institution or bank trust department for its non-discretionary, non-retirement fiduciary accounts, provided it executes a Fidelity Trust load waiver agreement which specifies certain aggregate minimum and operating provisions. This waiver is available only for shares purchased either directly from Fidelity or through a bank-affiliated broker, and is unavailable if the trust department or institution is part of an organization not principally engaged in banking or trust activities. The fund's sales charge may be reduced to reflect sales charges previously paid, or that would have been paid absent a reduction for some purchases made directly with Fidelity as noted in the prospectus, in connection with investments in other Fidelity funds. This includes reductions for investments in prototype-like retirement plans sponsored by FMR or FMR Corp., which are listed above. The fund is open for business and its net asset value per share (NAV) is calculated each day the New York Stock Exchange (NYSE) is open for trading. The NYSE has designated the following holiday closings for 1998: New Year's Day, Martin Luther King's Birthday, Presidents ' Day, Good Friday, Memorial Day, Independence Day (observed), Labor Day, Thanksgiving Day, and Christmas Day. Although FMR expects the same holiday schedule to be observed in the future, the NYSE may modify its holiday schedule at any time. In ad dition, on days when the Federal Reserve Wire System is closed, federal funds wires cannot be sen t. FSC normally determines the fund's NAV as of the close of the NYSE (normally 4:00 p.m. Eastern time). However, NAV may be calculated earlier if trading on the NYSE is restricted or as permitted by the SEC. To the extent that portfolio securities are traded in other markets on days when the NYSE is closed, the fund's NAV may be affected on days when investors do not have access to the fund to purchase or redeem shares. In addition, trading in some of a fund's portfolio securities may not occur on days when the fund is open for business. If the Trustees determine that existing conditions make cash payments undesirable, redemption payments may be made in whole or in part in securities or other property, valued for this purpose as they are valued in computing the fund's NAV. Shareholders receiving securities or other property on redemption may realize a gain or loss for tax purposes, and will incur any costs of sale, as well as the associated inconveniences. Pursuant to Rule 11a-3 under the 1940 Act, the fund is required to give shareholders at least 60 days' notice prior to terminating or modifying its exchange privilege. Under the Rule, the 60-day notification requirement may be waived if (i) the only effect of a modification would be to reduce or eliminate an administrative fee, redemption fee, or deferred sales charge ordinarily payable at the time of an exchange, or (ii) the fund suspends the redemption of the shares to be exchanged as permitted under the 1940 Act or the rules and regulations thereunder, or the fund to be acquired suspends the sale of its shares because it is unable to invest amounts effectively in accordance with its investment objective and policies. In the Prospectus, the fund has notified shareholders that it reserves the right at any time, without prior notice, to refuse exchange purchases by any person or group if, in FMR's judgment, the fund would be unable to invest effectively in accordance with its investment objective and policies, or would otherwise potentially be adversely affected. DISTRIBUTIONS AND TAXES DISTRIBUTIONS. If you request to have distributions mailed to you and the U.S. Postal Service cannot deliver your checks, or if your checks remain uncashed for six months, Fidelity may reinvest your distributions at the then-current NAV. All subsequent distributions will then be reinvested until you provide Fidelity with alternate instructions. DIVIDENDS. A portion of the fund's income may qualify for the dividends-received deduction available to corporate shareholders to the extent that the fund's income is derived from qualifying dividends. Because the fund may earn other types of income, such as interest, income from securities loans, non-qualifying dividends, and short-term capital gains, the percentage of dividends from the fund that qualifies for the deduction generally will be less than 100%. The fund will notify corporate shareholders annually of the percentage of fund dividends that qualifies for the dividends-received deduction. A portion of the fund's dividends derived from certain U.S. Government securities may be exempt from state and local taxation. Gains (losses) attributable to foreign currency fluctuations are generally taxable as ordinary income, and therefore will increase (decrease) dividend distributions. If the fund's distributions exceed its net investment company taxable income during a taxable year, all or a portion of the distributions made in the same taxable year would be recharacterized as a return of capital to shareholders, thereby reducing each shareholder's cost basis in the fund. Short-term capital gains are distributed as dividend income. The fund will send each shareholder a notice in January describing the tax status of dividends and capital gain distributions for the prior year. CAPITAL GAIN DISTRIBUTIONS. Long-term capital gains earned by the fund on the sale of securities and distributed to shareholders are federally taxable as long-term capital gains, regardless of the length of time shareholders have held their shares. If a shareholder receives a capital gain distribution on shares of the fund, and such shares are held six months or less and are sold at a loss, the portion of the loss equal to the amount of the capital gain distribution will be considered a long-term loss for tax purposes. Short-term capital gains distributed by the fund are taxable to shareholders as dividends, not as capital gains. FOREIGN TAXES. Foreign governments may withhold taxes on dividends and interest paid with respect to foreign securities. Foreign governments may also impose taxes on other payments or gains with respect to foreign securities. Because the fund does not currently anticipate that securities of foreign issuers will constitute more than 50% of its total assets at the end of its fiscal year, shareholders should not expect to claim a foreign tax credit or deduction on their federal income tax returns with respect to foreign taxes withheld. TAX STATUS OF THE FUND. The fund intends to qualify each year as a "regulated investment company" for tax purposes so that it will not be liable for federal tax on income and capital gains distributed to shareholders. In order to qualify as a regulated investment company and avoid being subject to federal income or excise taxes at the fund level, the fund intends to distribute substantially all of its net investment income and net realized capital gains within each calendar year as well as on a fiscal year basis , and intends to comply with other tax rules applicable to regulated investment companies. The fund is treated as a separate entity from the other funds of Fidelity Hastings Street Trust for tax purposes. If a fund purchases shares in certain foreign investment entities, defined as passive foreign investment companies (PFICs) in the Internal Revenue Code, it may be subject to U.S. federal income tax on a portion of any excess distribution or gain from the disposition of such shares. Interest charges may also be imposed on a fund with respect to deferred taxes arising from such distributions or gains. Generally, the fund will elect to mark-to-market any PFIC shares. Unrealized gains will be recognized as income for tax purposes and must be distributed to shareholders as dividends. OTHER TAX INFORMATION. The information above is only a summary of some of the tax consequences generally affecting the fund and its shareholders, and no attempt has been made to discuss individual tax consequences. In addition to federal income taxes, shareholders may be subject to state and local taxes on fund distributions, and shares may be subject to state and local personal property taxes. Investors should consult their tax advisers to determine whether a fund is suitable to their particular tax situation. FMR All of the stock of FMR is owned by FMR Corp., its parent organized in 1972. The voting common stock of FMR Corp. is divided into two classes. Class B is held predominantly by members of the Edward C. Johnson 3d family and is entitled to 49% of the vote on any matter acted upon by the voting common stock. Class A is held predominantly by non-Johnson family member employees of FMR Corp. and its affiliates and is entitled to 51% of the vote on any such matter. The Johnson family group and all other Class B shareholders have entered into a shareholders' voting agreement under which all Class B shares will be voted in accordance with the majority vote of Class B shares. Under the 1940 Act, control of a company is presumed where one individual or group of individuals owns more than 25% of the voting stock of that company. Therefore, through their ownership of voting common stock and the execution of the shareholders' voting agreement, members of the Johnson family may be deemed, under the 1940 Act, to form a controlling group with respect to FMR Corp. At present, the principal operating activities of FMR Corp. are those conducted by its division, Fidelity Investments Retail Marketing Company, which provides marketing services to various companies within the Fidelity organization. Fidelity investment personnel may invest in securities for their own accounts pursuant to a code of ethics that sets forth all employees' fiduciary responsibilities regarding the funds, establishes procedures for personal investing and restricts certain transactions. For example, all personal trades in most securities require pre-clearance, and participation in initial public offerings is prohibited. In addition, restrictions on the timing of personal investing in relation to trades by Fidelity funds and on short-term trading have been adopted. TRUSTEES AND OFFICERS The Trustees, Members of the Advisory Board, and executive officers of the trust are listed below. Except as indicated, each individual has held the office shown or other offices in the same company for the last five years. All persons named as Trustees and Members of the Advisory Board also serve in similar capacities for other funds advised by FMR. The business address of each Trustee, Member of the Advisory Board, and officer who is an "interested person" (as defined in the 1940 Act) is 82 Devonshire Street, Boston, Massachusetts 02109, which is also the address of FMR. The business address of all the other Trustees is Fidelity Investments, P.O. Box 9235, Boston, Massachusetts 02205-9235. Those Trustees who are "interested persons" by virtue of their affiliation with either the trust or FMR are indicated by an asterisk (*). *EDWARD C. JOHNSON 3d ( 67 ), Trustee and President, is Chairman, Chief Executive Officer and a Director of FMR Corp.; a Director and Chairman of the Board and of the Executive Committee of FMR; Chairman and a Director of Fidelity Investments Money Management , Inc. (1998) , Fidelity Management & Research (U.K.) Inc., and Fidelity Management & Research (Far East) Inc. Abigail Johnson, Vice President of certain Equity Funds, is Mr. Johnson's daughter. J. GARY BURKHEAD ( 56 ), Member of the Advisory Board (1997), is Vice Chairman and a Member of the Board of Directors of FMR Corp. (1997) and President of Fidelity Personal Investments and Brokerage Group (1997). Previously, Mr. Burkhead served as President of Fidelity Management & Research Company. RALPH F. COX ( 65 ), Trustee, is President of RABAR Enterprises (management consulting-engineering industry, 1994). Prior to February 1994, he was President of Greenhill Petroleum Corporation (petroleum exploration and production). Until March 1990, Mr. Cox was President and Chief Operating Officer of Union Pacific Resources Company (exploration and production). He is a Director of USA Waste Services, Inc. (non-hazardous waste, 1993), CH2M Hill Companies (engineering), Rio Grande, Inc. (oil and gas production), and Daniel Industries (petroleum measurement equipment manufacturer). In addition, he is a member of advisory boards of Texas A&M University and the University of Texas at Austin. PHYLLIS BURKE DAVIS ( 66 ), Trustee. Prior to her retirement in September 1991, Mrs. Davis was the Senior Vice President of Corporate Affairs of Avon Products, Inc. She is currently a Director of BellSouth Corporation (telecommunications), Eaton Corporation (manufacturing, 1991), and the TJX Companies, Inc. (retail stores), and previously served as a Director of Hallmark Cards, Inc. (1985-1991) and Nabisco Brands, Inc. In addition, she is a member of the President's Advisory Council of The University of Vermont School of Business Administration. ROBERT M. GATES (54), Trustee (1997), is a consultant, author, and lecturer (1993). Mr. Gates was Director of the Central Intelligence Agency (CIA) from 1991-1993. From 1989 to 1991, Mr. Gates served as Assistant to the President of the United States and Deputy National Security Advisor. Mr. Gates is a Director of LucasVarity PLC (automotive components and diesel engines), Charles Stark Draper Laboratory (non-profit), NACCO Industries, Inc. (mining and manufacturing), and TRW Inc. (original equipment and replacement products). Mr. Gates also is a Trustee of the Forum for International Policy and of the Endowment Association of the College of William and Mary. In addition, he is a member of the National Executive Board of the Boy Scouts of America. E. BRADLEY JONES ( 70 ), Trustee. Prior to his retirement in 1984, Mr. Jones was Chairman and Chief Executive Officer of LTV Steel Company. He is a Director of TRW Inc. (original equipment and replacement products), Consolidated Rail Corporation, Birmingham Steel Corporation, and RPM, Inc. (manufacturer of chemical products), and he previously served as a Director of NACCO Industries, Inc. (mining and manufacturing, 1985-1995), Hyster-Yale Materials Handling, Inc. (1985-1995), and Cleveland-Cliffs Inc (mining), and as a Trustee of First Union Real Estate Investments. In addition, he serves as a Trustee of the Cleveland Clinic Foundation, where he has also been a member of the Executive Committee as well as Chairman of the Board and President, a Trustee and member of the Executive Committee of University School (Cleveland), and a Trustee of Cleveland Clinic Florida. DONALD J. KIRK ( 65 ), Trustee, is Executive-in-Residence (1995) at Columbia University Graduate School of Business and a financial consultant. From 1987 to January 1995, Mr. Kirk was a Professor at Columbia University Graduate School of Business. Prior to 1987, he was Chairman of the Financial Accounting Standards Board. Mr. Kirk is a Director of General Re Corporation (reinsurance), and he previously served as a Director of Valuation Research Corp. (appraisals and valuations, 1993-1995). In addition, he serves as Chairman of the Board of Directors of the National Arts Stabilization Fund, Chairman of the Board of Trustees of the Greenwich Hospital Association, a Member of the Public Oversight Board of the American Institute of Certified Public Accountants' SEC Practice Section (1995), and as a Public Governor of the National Association of Securities Dealers, Inc. (1996). *PETER S. LYNCH ( 55 ), Trustee, is Vice Chairman and Director of FMR. Prior to May 31, 1990, he was a Director of FMR and Executive Vice President of FMR (a position he held until March 31, 1991); Vice President of Fidelity Magellan Fund and FMR Growth Group Leader; and Managing Director of FMR Corp. Mr. Lynch was also Vice President of Fidelity Investments Corporate Services (1991-1992). In addition, he serves as a Trustee of Boston College, Massachusetts Eye & Ear Infirmary, Historic Deerfield (1989) and Society for the Preservation of New England Antiquities, and as an Overseer of the Museum of Fine Arts of Boston. WILLIAM O. McCOY ( 64 ), Trustee (1997), is the Vice President of Finance for the University of North Carolina (16-school system, 1995). Prior to his retirement in December 1994, Mr. McCoy was Vice Chairman of the Board of BellSouth Corporation (telecommunications, 1984) and President of BellSouth Enterprises (1986). He is currently a Director of Liberty Corporation (holding company, 1984), Weeks Corporation of Atlanta (real estate, 1994), Carolina Power and Light Company (electric utility, 1996), and the Kenan Transport Co. (1996). Previously, he was a Director of First American Corporation (bank holding company, 1979-1996). In addition, Mr. McCoy serves as a member of the Board of Visitors for the University of North Carolina at Chapel Hill (1994) and for the Kenan-Flager Business School (University of North Carolina at Chapel Hill, 1988). GERALD C. McDONOUGH ( 69 ), Trustee and Chairman of the non-interested Trustees, is Chairman of G.M. Management Group (strategic advisory services). Mr. McDonough is a Director of York International Corp. (air conditioning and refrigeration), Commercial Intertech Corp. (hydraulic systems, building systems, and metal products, 1992), CUNO, Inc. (liquid and gas filtration products, 1996), and Associated Estates Realty Corporation (a real estate investment trust, 1993). Mr. McDonough served as a Director of ACME-Cleveland Corp. (metal working, telecommunications, and electronic products) from 1987 - 1996 and Brush-Wellman Inc. (metal refining) from 1983 - 1997. MARVIN L. MANN (64), Trustee (1993) , is Chairman of the Board, President, and Chief Executive Officer of Lexmark International, Inc. (office machines, 1991). Prior to 1991, he held the positions of Vice President of International Business Machines Corporation ("IBM") and President and General Manager of various IBM divisions and subsidiaries. Mr. Mann is a Director of M.A. Hanna Company (chemicals, 1993), Imation Corp. (imaging and information storage, 1997), and Infomart (marketing services, 1991), a Trammell Crow Co. In addition, he serves as the Campaign Vice Chairman of the Tri-State United Way (1993) and is a member of the University of Alabama President's Cabinet. *ROBERT C. POZEN (51), Trustee (1997) and Senior Vice President, is also President and a Director of FMR (1997); and President and a Director of Fidelity Investments Money Management Inc. , (199 8 ), Fidelity Management & Research (U.K.) Inc. (1997), and Fidelity Management & Research (Far East) Inc. (1997). Previously, Mr. Pozen served as General Counsel, Managing Director, and Senior Vice President of FMR Corp. THOMAS R. WILLIAMS ( 69 ), Trustee, is President of The Wales Group, Inc. (management and financial advisory services). Prior to retiring in 1987, Mr. Williams served as Chairman of the Board of First Wachovia Corporation (bank holding company), and Chairman and Chief Executive Officer of The First National Bank of Atlanta and First Atlanta Corporation (bank holding company). He is currently a Director of ConAgra, Inc. (agricultural products), Georgia Power Company (electric utility), National Life Insurance Company of Vermont, American Software, Inc., and AppleSouth, Inc. (restaurants, 1992). ABIGAIL P. JOHNSON ( 36 ), is Vice President of certain Equity Funds (1997), and is a Director of FMR Corp. (1994). Before assuming her current responsibilities, Ms. Johnson managed a number of Fidelity funds. Edward C. Johnson 3d, Trustee and President of the Funds, is Ms. Johnson's father. ERIC D. ROITER ( 49 ), Secretary (1998), is Vice President (1998) and General Counsel of FMR (1998). Mr. Roiter was an Adjunct Member, Faculty of Law, at Columbia University Law School (1996-1997). Prior to joining Fidelity, Mr. Roiter was a partner at Debevoise & Plimpton (1981-1997) and served as an Assistant General Counsel of the U.S. Securities and Exchange Commission (1979-1981). RICHARD A. SILVER ( 51 ), Treasurer (1997), is Treasurer of the Fidelity funds and is an employee of FMR (1997). Before joining FMR, Mr. Silver served as Executive Vice President, Fund Accounting & Administration at First Data Investor Services Group, Inc. (1996 - 1997). Prior to 1996, Mr. Silver was Senior Vice President and Chief Financial Officer at The Colonial Group, Inc. Mr. Silver also served as Chairman of the Accounting/Treasurer's Committee of the Investment Company Institute (1987 - 1993). JOHN H. COSTELLO ( 51 ), Assistant Treasurer, is an employee of FMR. LEONARD M. RUSH ( 52 ), Assistant Treasurer (1994), is an employee of FMR (1994). Prior to becoming Assistant Treasurer of the Fidelity funds, Mr. Rush was Chief Compliance Officer of FMR Corp. (1993-1994) and Chief Financial Officer of Fidelity Brokerage Services, Inc. (1990-1993). The following table sets forth information describing the compensation of each Trustee and Member of the Advisory Board of the fund for his or her services for the fiscal year ended June 30 , 199 8 or calendar year ended December 31, 1997, as applicable. COMPENSATION TABLE
Trustees Aggregate Total and Compensation Compensation Members of the Advisory Board from from the Contrafund II B,+ Fund Complex*A J. Gary Burkhead** $ 0 $ 0 Ralph F. Cox $ 19 214,500 Phyllis Burke Davis $ 18 210,000 Robert M. Gates*** $ 15 176,000 Edward C. Johnson 3d** $ 0 0 E. Bradley Jones $ 18 211,500 Donald J. Kirk $ 18 211,500 Peter S. Lynch** $ 0 0 William O. McCoy**** $ 19 214,500 Gerald C. McDonough $ 23 264,500 Marvin L. Mann $ 19 214,500 Robert C. Pozen** $ 0 0 Thomas R. Williams $ 19 214,500
* Information is for the calendar year ended December 31, 1997 for 230 funds in the complex. ** Interested Trustees of the fund and Mr. Burkhead are compensated by FMR. *** Mr. Gates was elected to the Board of Trustees of Fidelity Hastings Street Trust on July 16, 1997. **** Mr. McCoy was appointed to the Board of Trustees of Fidelity Hastings Street Trust effective January 1, 1997. Mr. McCoy was elected to the Board of Trustees of Fidelity Hasting Street Trust on July 16, 1997. + Figures presented are estimated for the fund's first fiscal year ending June 30, 1998. A Compensation figures include cash, amounts required to be deferred, and may include amounts deferred at the election of Trustees. For the calendar year ended December 31, 1997, the Trustees accrued required deferred compensation from the funds as follows: Ralph F. Cox, $75,000, Phyllis Burke Davis, $75,000, Robert M. Gates, $62,500, E. Bradley Jones, $75,000, Donald J. Kirk, $75,000, William O. McCoy, $75,000, Gerald C. McDonough, $87,500, Marvin L. Mann, $75,000, and Thomas R. Williams, $75,000. Certain of the non-interested Trustees elected voluntarily to defer a portion of their compensation: Ralph F. Cox, $53,699, Marvin L. Mann, $53,699, and Thomas R. Williams, $62,462. B Compensation figures include cash . Under a deferred compensation plan adopted in September 1995 and amended in November 1996 (the Plan), non-interested Trustees must defer receipt of a portion of, and may elect to defer receipt of an additional portion of, their annual fees. Amounts deferred under the Plan are subjec t to vesting and are treated as though equivalent dollar amounts had been invested in shares of a cross-section of Fidelity funds including funds in each major investment discipline and representing a majority of Fidelity's assets under management (the Reference Funds). The amounts ultimately received by the Trustees under the Plan will be directly linked to the investment performance of the Reference Funds. Deferral of fees in accordance with the Plan will have a negligible effect on a fund's assets, liabilities, and net income per share, and will not obligate a fund to retain the services of any Trustee or to pay any particular level of compensation to the Trustee. A fund may invest in the Reference Funds under the Plan without shareholder approval. As of the public offering of shares of the fund, 100 % of the fund's total outstanding shares was held by FMR and an FMR affiliate(s). FMR Corp. is the ultimate parent company of FMR and the FMR affiliate(s). By virtue of his ownership interest in FMR Corp., as described in the "FMR" section on page , Mr. Edward C. Johnson 3d, President and Trustee of the fund, may be deemed to be a beneficial owner of these shares. MANAGEMENT CONTRACT FMR is the fund's manager pursuant to a management contract dated March 19, 1998 , which was approved by FMR, as the then sole shareholder, on March 26, 1998 . MANAGEMENT SERVICES. The fund employs FMR to furnish investment advisory and other services. Under the terms of its management contract with the fund, FMR acts as investment adviser and, subject to the supervision of the Board of Trustees, directs the investments of the fund in accordance with its investment objective, policies, and limitations. FMR also provides the fund with all necessary office facilities and personnel for servicing the fund's investments, compensates all officers of the fund and all Trustees who are "interested persons" of the trust or of FMR, and all personnel of the fund or FMR performing services relating to research, statistical, and investment activities. In addition, FMR or its affiliates, subject to the supervision of the Board of Trustees, provide the management and administrative services necessary for the operation of the fund. These services include providing facilities for maintaining the fund's organization; supervising relations with custodians, transfer and pricing agents, accountants, underwriters, and other persons dealing with the fund; preparing all general shareholder communications and conducting shareholder relations; maintaining the fund's records and the registration of the fund's shares under federal securities laws and making necessary filings under state securities laws; developing management and shareholder services for the fund; and furnishing reports, evaluations, and analyses on a variety of subjects to the Trustees. MANAGEMENT-RELATED EXPENSES. In addition to the management fee payable to FMR and the fees payable to the transfer, dividend disbursing, and shareholder servicing agent, pricing and bookkeeping agent, and securities lending agent, the fund pays all of its expenses that are not assumed by those parties. The fund pays for the typesetting, printing, and mailing of its proxy materials to shareholders, legal expenses, and the fees of the custodian, auditor and non-interested Trustees. The fund's management contract further provides that the fund will pay for typesetting, printing, and mailing prospectuses, statements of additional information, notices, and reports to shareholders; however, under the terms of the fund's transfer agent agreement, the transfer agent bears the costs of providing these services to existing shareholders. Other expenses paid by the fund include interest, taxes, brokerage commissions, the fund's proportionate share of insurance premiums and Investment Company Institute dues, and the costs of registering shares under federal securities laws and making necessary filings under state securities laws. The fund is also liable for such non-recurring expenses as may arise, including costs of any litigation to which the fund may be a party, and any obligation it may have to indemnify its officers and Trustees with respect to litigation. MANAGEMENT FEE. For the services of FMR under the management contract, the fund pays FMR a monthly management fee which has two components: a basic fee, which is the sum of a group fee rate and an individual fund fee rate, and a performance adjustment based on a comparison of the fund's performance to that of S&P 500. The group fee rate is based on the monthly average net assets of all of the registered investment companies with which FMR has management contracts. GROUP FEE RATE SCHEDULE EFFECTIVE ANNUAL FEE RATES Average Group Annualized Group Net Effective Annual Fee Assets Rate Assets Rate 0 - $3 billion .5200% $ 0.5 billion .5200% 3 - 6 .4900 25 .4238 6 - 9 .4600 50 .3823 9 - 12 .4300 75 .3626 12 - 15 .4000 100 .3512 15 - 18 .3850 125 .3430 18 - 21 .3700 150 .3371 21 - 24 .3600 175 .3325 24 - 30 .3500 200 .3284 30 - 36 .3450 225 .3249 36 - 42 .3400 250 .3219 42 - 48 .3350 275 .3190 48 - 66 .3250 300 .3163 66 - 84 .3200 325 .3137 84 - 102 .3150 350 .3113 102 - 138 .3100 375 .3090 138 - 174 .3050 400 .3067 174 - 210 .3000 425 .3046 210 - 246 .2950 450 .3024 246 - 282 .2900 475 .3003 282 - 318 .2850 500 .2982 318 - 354 .2800 525 .2962 354 - 390 .2750 550 .2942 390 - 426 .2700 426 - 462 .2650 462 - 498 .2600 498 - 534 .2550 Over 534 .2500 The group fee rate is calculated on a cumulative basis pursuant to the graduated fee rate schedule shown above on the left. The schedule above on the right shows the effective annual group fee rate at various asset levels, which is the result of cumulatively applying the annualized rates on the left. For example, the effective annual fee rate at $ 555 billion of group net assets - the approximate level for January 1998 - was 0.2937 %, which is the weighted average of the respective fee rates for each level of group net assets up to $ 555 billion. The fund's individual fund fee rate is 0.30%. Based on the average group net assets of the funds advised by FMR for January 1998, the fund's annual basic fee rate would be calculated as follows:
Group Fee Rate Individual Fund Fee Rate Basic Fee Rate Contrafund II 0. 2937 % + 0.30% = 0. 5937 %
One-twelfth of this annual basic fee rate is applied to the fund's net assets averaged for the most recent month, giving a dollar amount, which is the fee for that month. COMPUTING THE PERFORMANCE ADJUSTMENT. The basic fee for the fund is subject to upward or downward adjustment, depending upon whether, and to what extent, the fund's investment performance for the performance period exceeds, or is exceeded by, the record of the S&P 500 (the Index) over the same period. The performance period for the fund will commence on April 1, 1998 . Starting with the twelfth month, the performance adjustment takes effect. Each month subsequent to the twelfth month, a new month is added to the performance period until the performance period includes 36 months. Thereafter, the performance period consists of the most recent month plus the previous 35 months. Each percentage point of difference, calculated to the nearest 0.01 % (up to a maximum difference of (plus/minus)10.00) is multiplied by a performance adjustment rate of 0.02%. The performance comparison is made at the end of each month. One twelfth (1/12) of this rate is then applied to the fund's average net assets for the entire performance period, giving a dollar amount which will be added to (or subtracted from) the basic fee. The maximum annualized adjustment rate is (plus/minus)0.20% of the fund's average net assets over the performance period. The 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 Index is based on change in value and is adjusted for any cash distributions from the companies whose securities compose the Index. Because the adjustment to the basic fee is based on the fund's performance compared to the investment record of the Index, the controlling factor is not whether the fund's performance is up or down per se, but whether it is up or down more or less than the record of the Index. Moreover, the comparative investment performance of the fund is based solely on the relevant performance period without regard to the cumulative performance over a longer or shorter period of time. FMR may, from time to time, voluntarily reimburse all or a portion of the fund's expenses (exclusive of interest, taxes, brokerage commissions, and extraordinary expenses). FMR retains the ability to be repaid for these expense reimbursements in the amount that expenses fall below the limit prior to the end of the fiscal year. Expense reimbursements by FMR will increase the fund's total returns, and repayment of the reimbursement by the fund will lower its total returns. SUB-ADVISERS. On behalf of the fund, FMR has entered into sub-advisory agreements with FMR U.K. and FMR Far East. Pursuant to the sub-advisory agreements, FMR may receive investment advice and research services outside the United States from the sub-advisers. On behalf of the fund, FMR may also grant FMR U.K. and FMR Far East investment management authority as well as the authority to buy and sell securities if FMR believes it would be beneficial to the funds. Currently, FMR U.K. and FMR Far East each focus on issuers in countries other than the United States such as those in Europe, Asia, and the Pacific Basin. FMR U.K. and FMR Far East, which were organized in 1986, are wholly owned subsidiaries of FMR. Under the sub-advisory agreements FMR pays the fees of FMR U.K. and FMR Far East. For providing non-discretionary investment advice and research services, FMR pays FMR U.K. and FMR Far East fees equal to 110% and 105%, respectively, of FMR U.K.'s and FMR Far East's costs incurred in connection with providing investment advice and research services. On behalf of the fund, for providing discretionary investment management and executing portfolio transactions, FMR pays FMR U.K. and FMR Far East a fee equal to 50% of its monthly management fee rate (including any performance adjustment) with respect to the fund's average net assets managed by the sub-adviser on a discretionary basis. DISTRIBUTION AND SERVICE PLAN The Trustees have approved a Distribution and Service Plan on behalf of the fund (the Plan) pursuant to Rule 12b-1 under the 1940 Act (the Rule). The Rule provides in substance that a mutual fund may not engage directly or indirectly in financing any activity that is primarily intended to result in the sale of shares of the fund except pursuant to a plan approved on behalf of the fund under the Rule. The Plan, as approved by the Trustees, allows the fund and FMR to incur certain expenses that might be considered to constitute indirect payment by the fund of distribution expenses. Under the Plan, if the payment of management fees by the fund to FMR is deemed to be indirect financing by the fund of the distribution of its shares, such payment is authorized by the Plan. The Plan specifically recognizes that FMR may use its management fee revenue, as well as its past profits or its other resources, to pay FDC for expenses incurred in connection with the distribution of fund shares. In addition, the Plan provides that FMR, directly or through FDC, may make payments to third parties, such as banks or broker-dealers, that engage in the sale of fund shares, or provide shareholder support services. Currently, the Board of Trustees has authorized such payments for shares of the fund. Prior to approving the Plan, the Trustees carefully considered all pertinent factors relating to the implementation of the Plan, and determined that there is a reasonable likelihood that the Plan will benefit the fund and its shareholders. In particular, the Trustees noted that the Plan does not authorize payments by the fund other than those made to FMR under its management contract with the fund. To the extent that the Plan gives FMR and FDC greater flexibility in connection with the distribution of fund shares, additional sales of fund shares may result. Furthermore, certain shareholder support services may be provided more effectively under the Plan by local entities with whom shareholders have other relationships. The Glass-Steagall Act generally prohibits federally and state chartered or supervised banks from engaging in the business of underwriting, selling, or distributing securities. Although the scope of this prohibition under the Glass-Steagall Act has not been clearly defined by the courts or appropriate regulatory agencies, FDC believes that the Glass-Steagall Act should not preclude a bank from performing shareholder support services, or servicing and recordkeeping functions. FDC intends to engage banks only to perform such functions. However, changes in federal or state statutes and regulations pertaining to the permissible activities of banks and their affiliates or subsidiaries, as well as further judicial or administrative decisions or interpretations, could prevent a bank from continuing to perform all or a part of the contemplated services. If a bank were prohibited from so acting, the Trustees would consider what actions, if any, would be necessary to continue to provide efficient and effective shareholder services. In such event, changes in the operation of the fund might occur, including possible termination of any automatic investment or redemption or other services then provided by the bank. It is not expected that shareholders would suffer any adverse financial consequences as a result of any of these occurrences. In addition, state securities laws on this issue may differ from the interpretations of federal law expressed herein, and banks and other financial institutions may be required to register as dealers pursuant to state law. The fund may execute portfolio transactions with, and purchase securities issued by, depository institutions that receive payments under the Plan. No preference for the instruments of such depository institutions will be shown in the selection of investments. CONTRACTS WITH FMR AFFILIATES The fund has entered into a transfer agent agreement with FSC, an affiliate of FMR. Under the terms of the agreement, FSC performs transfer agency, dividend disbursing, and shareholder services for the fund. For providing transfer agency services, FSC receives an account fee and an asset-based fee each paid monthly with respect to each account in the fund. For retail accounts and certain institutional accounts, these fees are based on account size and fund type . For certain institutional retirement accounts, these fee s are based on fund type. For certain other institutional retirement accounts, these fees are based on account type (i.e., omnibus or non-omnibus) and, for non-omnibus accounts, fund type. The account fees are subject to increase based on posta ge rate changes. The asset-based fees are subject to adjustment if the year-to-date total return of the S&P 500 exceeds a positive or negative 15%. FSC also collects small account fees from certain accounts with balances of less than $2,500. In addition, FSC receives the pro rata portion of the transfer agency fees applicable to shareholder accounts in each Fidelity Freedom Fund, a fund of funds managed by an FMR affiliate, according to the percentage of the Freedom Fund's assets that is invested in the fund. 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 existing shareholders, with the exception of proxy statements. The fund has also entered into a service agent agreement with FSC. Under the terms of the agreement, FSC calculates the NAV and dividends for the fund, maintains the fund's portfolio and general accounting records, and administers the fund's securities lending program. For providing pricing and bookkeeping services, FSC receives a monthly fee based on the fund's average daily net assets throughout the month. The annual fee rates for pricing and bookkeeping services are 0.0600% of the first $500 million of average net assets and 0.0300% of average net assets in excess of $500 million. The fee, not including reimbursement for out-of-pocket expenses, is limited to a minimum of $60,000 and a maximum of $800,000 per year. For administering the fund's securities lending program, FSC receives fees based on the number and duration of individual securities loans. The fund has entered into a distribution agreement with FDC, an affiliate of FMR organized as a Massachusetts corporation on July 18, 1960. FDC is a broker-dealer registered under the Securities Exchange Act of 1934 and a member of the National Association of Securities Dealers, Inc. The distribution agreement calls for FDC to use all reasonable efforts, consistent with its other business, to secure purchasers for shares of the fund, which are continuously offered. Promotional and administrative expenses in connection with the offer and sale of shares are paid by FMR. DESCRIPTION OF THE TRUST TRUST ORGANIZATION. Fidelity Contrafund II is a fund of Fidelity Hastings Street Trust, an open-end management investment company originally organized under the name Fidelity Fund as a Massachusetts corporation on May 1, 1930, and reorganized as a Massachusetts business trust on December 31, 1984. The trust's name was changed to Fidelity Hastings Street Trust on April 30, 1993. Currently, there are four funds of the trust: Fidelity Fund, Fidelity Fifty, Fidelity Income & Growth Fund and Fidelity Contrafund I I. The Declaration of Trust permits the Trustee to create additional funds. In the event that FMR ceases to be the investment adviser to the trust or a fund, the right of the trust or fund to use the identifying name "Fidelity" may be withdrawn. The assets of the trust received for the issue or sale of shares of each fund and all income, earnings, profits, and proceeds thereof, subject only to the rights of creditors, are especially allocated to such fund, and constitute the underlying assets of such fund. The underlying assets of each fund are segregated on the books of account, and are to be charged with the liabilities with respect to such fund and with a share of the general expenses of the trust. Expenses with respect to the trust are to be allocated in proportion to the asset value of the respective funds, except where allocations of direct expense can otherwise be fairly made. The officers of the trust, subject to the general supervision of the Board of Trustees, have the power to determine which expenses are allocable to a given fund, or which are general or allocable to all of the funds. In the event of the dissolution or liquidation of the trust, shareholders of each fund are entitled to receive as a class the underlying assets of such fund available for distribution. SHAREHOLDER AND TRUSTEE LIABILITY. The trust is an entity of the type commonly known as a "Massachusetts business trust." Under Massachusetts law, shareholders of such a trust may, under certain circumstances, be held personally liable for the obligations of the trust. The Declaration of Trust provides that the trust shall not have any claim against shareholders except for the payment of the purchase price of shares and requires that each agreement, obligation, or instrument entered into or executed by the trust or the Trustees include a provision limiting the obligations created thereby to the trust and its assets. The Declaration of Trust provides for indemnification out of each fund's property of any shareholder held personally liable for the obligations of the fund. The Declaration of Trust also provides that each fund shall, upon request, assume the defense of any claim made against any shareholder for any act or obligation of the fund and satisfy any judgment thereon. Thus, the risk of a shareholder incurring financial loss on account of shareholder liability is limited to circumstances in which a fund itself would be unable to meet its obligations. FMR believes that, in view of the above, the risk of personal liability to shareholders is remote. The Declaration of Trust further provides that the Trustees, if they have exercised reasonable care, will not be liable for any neglect or wrongdoing, but nothing in the Declaration of Trust protects Trustees against any liability to which they would otherwise be subject by reason of willful misfeasance, bad faith, gross negligence, or reckless disregard of the duties involved in the conduct of their office. VOTING RIGHTS. Each fund's capital consists of shares of beneficial interest. As a shareholder, you receive one vote for each dollar value of net asset value you own. The shares have no preemptive or conversion rights; the voting and dividend rights, the right of redemption, and the privilege of exchange are described in the Prospectus. Shares are fully paid and nonassessable, except as set forth under the heading "Shareholder and Trustee Liability" above. Shareholders representing 10% or more of the trust or a fund may, as set forth in the Declaration of Trust, call meetings of the trust or a fund for any purpose related to the trust or fund, as the case may be, including, in the case of a meeting of the entire trust, the purpose of voting on removal of one or more Trustees. The trust or any fund may be terminated upon the sale of its assets to another open-end management investment company, or upon liquidation and distribution of its assets, if approved by vote of the holders of a majority of the trust or the fund, as determined by the current value of each shareholder's investment in the fund or trust. If not so terminated, the trust and its funds will continue indefinitely. Each fund may invest all of its assets in another investment company. CUSTODIAN. Brown Brothers Harriman & Co., 40 Water Street, Boston, Massachusetts, is custodian of the assets of the fund. The custodian is responsible for the safekeeping of a fund's assets and the appointment of any subcustodian banks and clearing agencies. The custodian takes no part in determining the investment policies of a fund or in deciding which securities are purchased or sold by a fund. However, a fund may invest in obligations of the custodian and may purchase securities from or sell securities to the custodian. The Bank of New York and The Chase Manhattan Bank , each headquartered in New York , also may serve as special purpose custodians of certain assets in connection with repurchase agreement transactions. FMR, its officers and directors, its affiliated companies, and the Board of Trustees may, from time to time, conduct transactions with various banks, including banks serving as custodians for certain funds advised by FMR. The Boston branch of the fund's custodian leases its office space from an affiliate of FMR at a lease payment which, when entered into, was consistent with prevailing market rates. Transactions that have occurred to date include mortgages and personal and general business loans. In the judgment of FMR, the terms and conditions of those transactions were not influenced by existing or potential custodial or other fund relationships. AUDITOR. C oopers & Lybrand L.L.P., One Post Office Square, Boston, Massachusetts serves as the fund's independent accountant. The auditor examines financial statements for the fund and provides other audit, tax, and related services. APPENDIX DESCRIPTION OF MOODY'S INVESTORS SERVICE RATINGS OF CORPORATE BONDS Moody's ratings for obligations with an original remaining maturity in excess of one year fall within nine categories. They range from Aaa (highest quality) to C (lowest quality). Moody applies numerical modifiers of 1, 2, or 3 to each generic rating classification from Aa through B. The modifier 1 indicates that the security ranks in the higher end of its generic rating category; the modifier 2 indicates a mid-range ranking; and the modifier 3 indicates that the issue ranks on the lower end of its generic rating category. AAA - Bonds that are rated Aaa are judged to be of the best quality. They carry the smallest degree of investment risk and are generally referred to as "gilt edged." Interest payments are protected by a large or by an exceptionally stable margin and principal is secure. While the various protective elements are likely to change, such changes as can be visualized are most unlikely to impair the fundamentally strong position of such issues. AA - Bonds that are rated Aa are judged to be of high quality by all standards. Together with the Aaa group they comprise what are generally known as high-grade bonds. They are rated lower than the best bonds because margins of protection may not be as large as in Aaa securities or fluctuation of protective elements may be of greater amplitude or there may be other elements present which make the long-term risks appear somewhat larger than the Aaa securities. A - Bonds that are rated A possess many favorable investment attributes and are to be considered as upper-medium-grade obligations. Factors giving security to principal and interest are considered adequate but elements may be present which suggest a susceptibility to impairment sometime in the future. BAA - Bonds that are rated Baa are considered as medium-grade obligations, (i.e., they are neither highly protected nor poorly secured). Interest payments and principal security appear adequate for the present but certain protective elements may be lacking or may be characteristically unreliable over any great length of time. Such bonds lack outstanding investment characteristics and in fact have speculative characteristics as well. BA - Bonds that are rated Ba are judged to have speculative elements; their future cannot be considered as well assured. Often the protection of interest and principal payments may be very moderate and thereby not well safeguarded during both good and bad times over the future. Uncertainty of position characterizes bonds in this class. B - Bonds that are rated B generally lack characteristics of the desirable investment. Assurance of interest and principal payments or of maintenance of other terms of the contract over any long period of time may be small. CAA - Bonds that are rated Caa are of poor standing. Such issues may be in default or there may be present elements of danger with respect to principal or interest. CA - Bonds that are rated Ca represent obligations which are speculative in a high degree. Such issues are often in default or have other marked short-comings. C - Bonds that are rated C are the lowest-rated class of bonds and issues so rated can be regarded as having extremely poor prospects of ever attaining any real investment standing. DESCRIPTION OF STANDARD & POOR'S RATINGS OF CORPORATE BONDS Debt issues may be designated by Standard & Poor's as either investment grade ("AAA" through "BBB") or speculative grade ("BB" through "D"). While speculative grade debt will likely have some quality and protective characteristics, these are outweighed by large uncertainties or major exposures to adverse conditions. Ratings from AA to CCC may be modified by the addition of a plus sign (+) or minus sign (-) to show relative standing within the major rating categories. AAA - Debt rated AAA has the highest rating assigned by Standard & Poor's to a debt obligation. Capacity to pay interest and repay principal is extremely strong. AA - Debt rated AA has a very strong capacity to pay interest and repay principal and differs from the higher-rated issues only in small degree. A - Debt rated A has a strong capacity to pay interest and repay principal, although it is somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than debt in higher rated categories. BBB - Debt rated BBB is regarded as having an adequate capacity to pay interest and repay principal. Whereas it normally exhibits adequate protection parameters, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to pay interest and repay principal for debt in this category than in higher-rated categories. BB - Debt rated BB has less near-term vulnerability to default than other speculative issues. However, it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to inadequate capacity to meet timely interest and principal payments. The BB rating category is also used for debt subordinated to senior debt that is assigned an actual or implied BBB- rating. B - Debt rated B has a greater vulnerability to default but currently has the capacity to meet interest payments and principal repayments. Adverse business, financial, or economic conditions will likely impair capacity or willingness to pay interest and repay principal. The B rating category is also used for debt subordinated to senior debt that is assigned an actual or implied BB or BB- rating. CCC - Debt rated CCC has a currently identifiable vulnerability to default, and is dependent upon favorable business, financial, and economic conditions to meet timely payment of interest and repayment of principal. In the event of adverse business, financial, or economic conditions, it is not likely to have the capacity to pay interest and repay principal. The CCC rating category is also used for debt subordinated to senior debt that is assigned an actual or implied B or B- rating. CC - Debt rated CC is typically applied to debt subordinated to senior debt which is assigned an actual or implied CCC debt rating. C - The rating C is typically applied to debt subordinated to senior debt which is assigned an actual or implied CCC- debt rating. The C rating may be used to cover a situation where a bankruptcy petition has been filed but debt service payments are continued. CI - The rating CI is reserved for income bonds on which no interest is being paid. D - Debt rated D is in payment default. The D rating category is used when interest payments or principal payments are not made on the date due even if the applicable grace period has not expired, unless S&P believes that such payments will be made during such grace period. The D rating will also be used upon the filing of a bankruptcy petition if debt service payments are jeopardized. PART C - OTHER INFORMATION Item 24. Financial Statements and Exhibits (a) Not applicable (b) Exhibits: 1. (a) Restated Declaration of Trust, dated June 16, 1994, is incorporated herein by reference to Exhibit 1(a) of Post-Effective Amendment No. 96. (b) Supplement to the Declaration of Trust, dated August 1, 1997, is incorporated herein by reference to Exhibit 1(b) of Post-Effective Amendment No. 100. 2. (a) Bylaws of the Trust, as amended, are incorporated herein by reference to Exhibit 2(a) to Fidelity Union Street Trust's Post-Effective Amendment No. 87 (File No. 2-50318). 3. Not applicable. 4. Not applicable. 5. (a) Management Contract, dated August 1, 1997, between Fidelity Hastings Street Trust, on behalf of Fidelity Fund, and Fidelity Management & Research Company is incorporated herein by reference to Exhibit 5(a) of Post-Effective Amendment No. 100. (b) Management Contract, dated August 1, 1997, between Fidelity Hastings Street Trust, on behalf of Fidelity Fifty, and Fidelity Management & Research Company, is incorporated herein by reference to Exhibit 5(d) of Post-Effective Amendment No. 100. (c) Form of Management Contract between Fidelity Hastings Street Trust and Fidelity Management & Research Company, is filed herein as Exhibit 5(c). (d) Form of Management Contract between Fidelity Hastings Street Trust, on behalf of Fidelity Income & Growth Fund, and Fidelity Management & Research Company is filed herein as Exhibit 5(d). (e) Sub-Advisory Agreement, dated August 1, 1997, between Fidelity Management & Research Company and Fidelity Management & Research (U.K.) Inc., and Fidelity Hastings Street Trust, on behalf of Fidelity Fund, is incorporated herein by reference to Exhibit 5(b) of Post-Effective Amendment No. 100. (f) Sub-Advisory Agreement, dated August 1, 1997, between Fidelity Management & Research Company and Fidelity Management & Research (Far East) Inc., and Fidelity Hastings Street Trust, on behalf of Fidelity Fund, is incorporated herein by reference to Exhibit 5(c) of Post-Effective Amendment No. 100. (g) Sub-Advisory Agreement, dated July 15, 1993, between Fidelity Management & Research Company and Fidelity Management & Research (U.K.) Inc., and Fidelity Hastings Street Trust, on behalf of Fidelity Fifty, is incorporated herein by reference to Exhibit 5(e) of Post-Effective Amendment No. 95. (h) Sub-Advisory Agreement, dated July 15, 1993, between Fidelity Management & Research Company and Fidelity Management & Research (Far East) Inc., and Fidelity Hastings Street Trust, on behalf of Fidelity Fifty, is incorporated herein by reference to Exhibit 5(f) of Post-Effective Amendment No. 95. (i) Form of Sub-Advisory Agreement between Fidelity Management & Research Company and Fidelity Management & Research (U.K.) Inc., and Fidelity Hastings Street Trust is filed herein as Exhibit 5(i). (j) Form of Sub-Advisory Agreement between Fidelity Management & Research Company and Fidelity Management & Research (Far East) Inc., and Fidelity Hastings Street Trust is filed herein as Exhibit 5(j). (k) Form of Sub-Advisory Agreement between Fidelity Management & Research Company and Fidelity Management & Research (U.K.) Inc., and Fidelity Hastings Street Trust, on behalf of Fidelity Income & Growth Fund, is filed herein as Exhibit 5(k). (l) Form of Sub-Advisory Agreement between Fidelity Management & Research Company and Fidelity Management & Research (Far East) Inc., and Fidelity Hastings Street Trust, on behalf of Fidelity Income & Growth Fund, is filed herein as Exhibit 5(l). 6. (a) General Distribution Agreement, dated April 1, 1987, between Fidelity Hastings Street Trust, on behalf of Fidelity Fund, and Fidelity Distributors Corporation, is incorporated herein by reference to Exhibit 6(a) of Post-Effective Amendment No. 97. (b) Amendment to General Distribution Agreement, dated January 1, 1988, between Fidelity Hastings Street Trust, on behalf of Fidelity Fund, and Fidelity Distributors Corporation, is incorporated herein by reference to Exhibit 6(b) of Post-Effective Amendment No. 97. (c) General Distribution Agreement, dated July 15, 1994, between Fidelity Hastings Street Trust, on behalf of Fidelity Fifty, and Fidelity Distributors Corporation, is incorporated herein by reference to Exhibit 6(c) of Post-Effective Amendment No. 96. (d) Amendments to the General Distribution Agreement between Fidelity Hastings Street Trust on behalf of Fidelity Fifty and Fidelity Distributors Corporation, dated March 14, 1996 and July 15, 1996, are incorporated herein by reference to Exhibit 6(l) of Fidelity Select Portfolios' Post-Effective Amendment No. 57 (File No. 2-69972). (e) Amendments to the General Distribution Agreement between Fidelity Hastings Street Trust on behalf of Fidelity Fund and Fidelity Distributors Corporation, dated March 14, 1996 and July 15, 1996, are incorporated herein by reference to Exhibit 6(a) of Fidelity Court Street Trust's Post-Effective Amendment No. 61 (File No. 2-58774). (f) Form of General Distribution Agreement between Fidelity Hastings Street Trust and Fidelity Distributors Corporation, is filed herein as Exhibit 6(f). (g) Form of General Distribution Agreement between Fidelity Hastings Street Trust on behalf of Fidelity Income & Growth Fund and Fidelity Distributors Corporation, is filed herein as Exhibit 6(g). (h) Form of Bank Agency Agreement is filed herein as Exhibit 6(h). (i) Form of Selling Dealer Agreement for Bank-Related Transactions is filed herein as Exhibit 6(i). 7. (a) Retirement Plan for Non-Interested Person Trustees, Directors or General Partners, as amended on November 16, 1995, is incorporated herein by reference to Exhibit 7(a) of Fidelity Select Portfolio's (File No. 2-69972) Post-Effective Amendment No. 54. (b) The Fee Deferral Plan for Non-Interested Person Directors and Trustees of the Fidelity Funds, effective as of September 14, 1995 and amended through November 14, 1996, is incorporated herein by reference to Exhibit 7(b) of Fidelity Aberdeen Street Trust's (File No. 33-43529) Post-Effective Amendment No. 19. 8. (a) Custodian Agreement and Appendix C, dated August 1, 1994, between The Chase Manhattan Bank, N.A. and Fidelity Hastings Street Trust on behalf of Fidelity Fund, is incorporated herein by reference to Exhibit 8(a) of Fidelity Investment Trust's Post-Effective Amendment No. 59 (File No. 2-90649). (b) Appendix A, dated October 17, 1996, to the Custodian Agreement, dated August 1, 1994, between The Chase Manhattan Bank, N.A. and Fidelity Hastings Street Trust on behalf of Fidelity Fund, is incorporated herein by reference to Exhibit 8(c) of Fidelity Charles Street Trust's Post-Effective Amendment No. 57 (File No. 2-73133). (c) Appendix B, dated September 18, 1997, to the Custodian Agreement, dated August 1, 1994, between The Chase Manhattan Bank, N.A. and Fidelity Hastings Street Trust on behalf of Fidelity Fund is incorporated herein by reference to Exhibit 8(b) of Fidelity Charles Street Trust's Post-Effective Amendment No. 62 (File No. 2-73133). (d) Custodian Agreement and Appendix C, dated September 1, 1994, between Brown Brothers Harriman & Company and Fidelity Hastings Street Trust on behalf of Fidelity Fifty is incorporated herein by reference to Exhibit 8(a) of Fidelity Commonwealth Trust's Post-Effective Amendment No. 56 (File No. 2-52322). (e) Appendix A, dated October 16, 1997, to the Custodian Agreement, dated September 1, 1994, between Brown Brothers Harriman & Company and Fidelity Hastings Street Trust on behalf of Fidelity Fifty is incorporated herein by reference to Exhibit 8(b) of Fidelity Contrafund's Post-Effective Amendment No. 50 (File No. 2-25235). (f) Appendix B, dated September 18, 1997 to the Custodian Agreement, dated September 1, 1994, between Brown Brothers Harriman & Company and Fidelity Hastings Street Trust on behalf of Fidelity Fifty is incorporated herein by reference to Exhibit 8(c) of Fidelity Contrafund's Post-Effective Amendment No. 50 (File No. 2-25235). (g) Fidelity Group Repo Custodian Agreement among The Bank of New York, J. P. Morgan Securities, Inc., and the Registrant, dated February 12, 1996, is incorporated herein by reference to Exhibit 8(d) of Fidelity Institutional Cash Portfolios' (File No. 2-74808) Post-Effective Amendment No. 31. (h) Schedule 1 to the Fidelity Group Repo Custodian Agreement between The Bank of New York and the Registrant, dated February 12, 1996, is incorporated herein by reference to Exhibit 8(e) of Fidelity Institutional Cash Portfolios' (File No. 2-74808) Post-Effective Amendment No. 31. (i) Fidelity Group Repo Custodian Agreement among Chemical Bank, Greenwich Capital Markets, Inc., and the Registrant, dated November 13, 1995, is incorporated herein by reference to Exhibit 8(f) of Fidelity Institutional Cash Portfolios' (File No. 2-74808) Post-Effective Amendment No. 31. (j) Schedule 1 to the Fidelity Group Repo Custodian Agreement between Chemical Bank and the Registrant, dated November 13, 1995, is incorporated herein by reference to Exhibit 8(g) of Fidelity Institutional Cash Portfolios' (File No. 2-74808) Post-Effective Amendment No. 31. (k) Joint Trading Account Custody Agreement between The Bank of New York and the Registrant, dated May 11, 1995, is incorporated herein by reference to Exhibit 8(h) of Fidelity Institutional Cash Portfolios' (File No. 2-74808) Post-Effective Amendment No. 31. (l) First Amendment to Joint Trading Account Custody Agreement between The Bank of New York and the Registrant, dated July 14, 1995, is incorporated herein by reference to Exhibit 8(i) of Fidelity Institutional Cash Portfolios' (File No. 2-74808) Post-Effective Amendment No. 31. (m) Forms of Fidelity Group Repo Custodian Agreement and Schedule 1 among The Bank of New York, J. P. Morgan Securities, Inc., and Fidelity Hastings Street Trust are filed herein as Exhibit 8(m). (n) Forms of Fidelity Group Repo Custodian Agreement and Schedule 1 among Chemical Bank, Greenwich Capital Markets, Inc., and Fidelity Hastings Street Trust are filed herein as Exhibit 8(n). (o) Forms of Joint Trading Account Custody Agreement and First Amendment to Joint Trading Account Custody Agreement between The Bank of New York and Fidelity Hastings Street Trust are filed herein as Exhibit 8(o). (p) Form of Custodian Agreement and Appendix B and C, between Brown Brothers Harriman & Company and Fidelity Hastings Street Trust is filed herein as Exhibit 8(p). (q) Form of Custodian Agreement and Appendix B and C, between The Chase Manhattan Bank, N.A. and Fidelity Hastings Street Trust on behalf of Fidelity Income & Growth Fund, is filed herein as Exhibit 8(q). 9. Not applicable. 10. Not applicable. 11. Consent of Coopers & Lybrand L.L.P. is filed herein as Exhibit 11. 12. Not applicable. 13. Not applicable. 14. (a) Fidelity Individual Retirement Account Custodial Agreement and Disclosure Statement, as currently in effect, is incorporated herein by reference to Exhibit 14(a) of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87. (b) Fidelity Institutional Individual Retirement Account Custodial Agreement and Disclosure Statement, as currently in effect, is incorporated herein by reference to Exhibit 14(d) of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87. (c) National Financial Services Corporation Individual Retirement Account Custodial Agreement and Disclosure Statement, as currently in effect, is incorporated herein by reference to Exhibit 14(h) of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87. (d) Fidelity Portfolio Advisory Services Individual Retirement Account Custodial Agreement and Disclosure Statement, as currently in effect, is incorporated herein by reference to Exhibit 14(i) of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87. (e) Fidelity 403(b)(7) Custodial Account Agreement, as currently in effect, is incorporated herein by reference to Exhibit 14(e) of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87. (f) National Financial Services Corporation Defined Contribution Retirement Plan and Trust Agreement, as currently in effect, is incorporated herein by reference to Exhibit 14(k) of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87. (g) The CORPORATEplan for Retirement Profit Sharing/401K Plan, as currently in effect, is incorporated herein by reference to Exhibit 14(l) of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87. (h) The CORPORATEplan for Retirement Money Purchase Pension Plan, as currently in effect, is incorporated herein by reference to Exhibit 14(m) of Fidelity Union Street Trust's (File No. 2-50318) Post-Effective Amendment No. 87. (i) Fidelity Investments Section 403(b)(7) Individual Custodial Account Agreement and Disclosure Statement, as currently in effect, is incorporated herein by reference to Exhibit 14(f) of Fidelity Commonwealth Trust's (File No. 2-52322) Post Effective Amendment No. 57. (j) Plymouth Investments Defined Contribution Retirement Plan and Trust Agreement, as currently in effect, is incorporated herein by reference to Exhibit 14(o) of Fidelity Commonwealth Trust's (File No. 2-52322) Post Effective Amendment No. 57. (k) The Fidelity Prototype Defined Benefit Pension Plan and Trust Basic Plan Document and Adoption Agreement, as currently in effect, is incorporated herein by reference to Exhibit 14(d) of Fidelity Securities Fund's (File No. 2-93601) Post Effective Amendment No. 33. (l) The Institutional Prototype Plan Basic Plan Document, Standardized Adoption Agreement, and Non-Standardized Adoption Agreement, as currently in effect, is incorporated herein by reference to Exhibit 14(o) of Fidelity Securities Fund's (File No. 2-93601) Post Effective Amendment No. 33. (m) The CORPORATEplan for Retirement 100SM Profit Sharing/401(k) Basic Plan Document, Standardized Adoption Agreement, and Non-Standardized Adoption Agreement, as currently in effect, is incorporated herein by reference to Exhibit 14(f) of Fidelity Securities Fund's (File No. 2-93601) Post Effective Amendment No. 33. (n) The Fidelity Investments 401(a) Prototype Plan for Tax-Exempt Employers Basic Plan Document, Standardized Profit Sharing Plan Adoption Agreement, Non-Standardized Discretionary Contribution Plan No. 002 Adoption Agreement, and Non-Standardized Discretionary Contribution Plan No. 003 Adoption Agreement, as currently in effect, is incorporated herein by reference to Exhibit 14(g) of Fidelity Securities Fund's (File No. 2-93601) Post Effective Amendment No. 33. (o) Fidelity Investments 403(b) Sample Plan Basic Plan Document and Adoption Agreement, as currently in effect, is incorporated herein by reference to Exhibit 14(p) of Fidelity Securities Fund's (File No. 2-93601) Post Effective Amendment No. 33. (p) Fidelity Defined Contribution Retirement Plan and Trust Agreement, as currently in effect, is incorporated herein by reference to Exhibit 14(c) of Fidelity Securities Fund's (File No. 2-93601) Post Effective Amendment No. 33. (q) Fidelity SIMPLE-IRAPlan Adoption Agreement, Company Profile Form, and Plan Document, as currently in effect, is incorporated herein by reference to Exhibit 14(q) of Fidelity Aberdeen Street Trust's (File No. 33-43529) Post-Effective Amendment No. 19. 15. (a) Distribution and Service Plan pursuant to Rule 12b-1 for Fidelity Fund is incorporated herein by reference as Exhibit 15(a) of Post-Effective Amendment No. 100. (b) Form of Distribution and Service Plan pursuant to Rule 12b-1 for Fidelity Income & Growth Fund is filed herein as Exhibit 15(b). (c) Form of Distribution and Service Plan pursuant to Rule 12b-1 is filed herein as Exhibit 15(c). 16. (a) Not applicable. (b) A schedule for computation of long-term moving averages is incorporated herein by reference to Exhibit 16(c) of Post-Effective Amendment No. 92. 17. Not applicable. 18. Not applicable. Item 25. Persons Controlled by or under Common Control with Registrant The Board of Trustees of Registrant is the same as the board of other funds advised by FMR, each of which has Fidelity Management & Research Company as its investment adviser. In addition, the officers of these funds are substantially identical. Nonetheless, Registrant takes the position that it is not under common control with these other funds since the power residing in the respective boards and officers arises as the result of an official position with the respective funds. Item 26. Number of Holders of Securities January 31, 1998 Title of Class: Shares of Beneficial Interest Number of Record Holders Name of Series Fidelity Fifty 18,126 Fidelity Fund 362,046 Fidelity Income & Growth Fund 0 New Equity Fund 0 Item 28. Business and Other Connections of Investment Adviser (1) FIDELITY MANAGEMENT & RESEARCH COMPANY (FMR) FMR serves as investment adviser to a number of other investment companies. The directors and officers of the Adviser have held, during the past two fiscal years, the following positions of a substantial nature.
Edward C. Johnson 3d Chairman of the Board of FMR; President and Chief Executive Officer of FMR Corp.; Chairman of the Board and Director of FMR, FMR Corp., FIMM, FMR (U.K.) Inc., and FMR (Far East) Inc.; Chairman of the Board and Representative Director of Fidelity Investments Japan Limited; President and Trustee of funds advised by FMR. Robert C. Pozen President and Director of FMR; Senior Vice President and Trustee of funds advised by FMR; President and Director of FIMM, FMR (U.K.) Inc., and FMR (Far East) Inc.; Previously, General Counsel, Managing Director, and Senior Vice President of FMR Corp. Peter S. Lynch Vice Chairman of the Board and Director of FMR. Marta Amieva Vice President of FMR. John H. Carlson Vice President of FMR and of funds advised by FMR. Dwight D. Churchill Senior Vice President of FMR and Vice President of Bond Funds advised by FMR. Barry Coffman Vice President of FMR. Arieh Coll Vice President of FMR. Stephen G. Manning Assistant Treasurer of FMR. William Danoff Senior Vice President of FMR and Vice President of a fund advised by FMR. Scott E. DeSano Vice President of FMR. Penelope Dobkin Vice President of FMR and of a fund advised by FMR. George C. Domolky Vice President of FMR. Walter C. Donovan Vice President of FMR. Bettina Doulton Vice President of FMR and of funds advised by FMR. Margaret L. Eagle Vice President of FMR and of funds advised by FMR. William R. Ebsworth Vice President of FMR. Richard B. Fentin Senior Vice President of FMR and Vice President of a fund advised by FMR. Gregory Fraser Vice President of FMR and of a fund advised by FMR. Jay Freedman Assistant Clerk of FMR; Clerk of FMR Corp., FMR (U.K.) Inc., and FMR (Far East) Inc.; Secretary of FIMM. Robert Gervis Vice President of FMR. David L. Glancy Vice President of FMR and of a fund advised by FMR. Kevin E. Grant Vice President of FMR and of funds advised by FMR. Barry A. Greenfield Vice President of FMR and of a fund advised by FMR. Boyce I. Greer Senior Vice President of FMR and Vice President of Money Market Funds advised by FMR. Bart A. Grenier Vice President of High-Income Funds advised by FMR;Vice President of FMR. Robert Haber Vice President of FMR. Richard C. Habermann Senior Vice President of FMR; Vice President of funds advised by FMR. Richard Hazelwood Vice President of FMR. Fred L. Henning Jr. Senior Vice President of FMR and Vice President of Fixed-Income funds advised by FMR. Bruce T. Herring Vice President of FMR. John R. Hickling Vice President of FMR and of a fund advised by FMR. Robert F. Hill Vice President of FMR; Director of Technical Research. Curt Hollingsworth Vice President of FMR and of funds advised by FMR. Abigail P. Johnson Senior Vice President of FMR and Vice President of funds advised by FMR; Associate Director and Senior Vice President of Equity funds advised by FMR. David B. Jones Vice President of FMR. Steven Kaye Vice President of FMR and of a fund advised by FMR. Francis V. Knox Vice President of FMR; Compliance Officer of FMR (U.K.) Inc. Robert A. Lawrence Senior Vice President of FMR and Vice President of Fidelity Real Estate High Income and Fidelity Real Estate High income II funds advised by FMR; Associate Director and Senior Vice President of Equity funds advised by FMR; Previously, Vice President of High Income funds advised by FMR. Harris Leviton Vice President of FMR and of a fund advised by FMR. Bradford E. Lewis Vice President of FMR and of funds advised by FMR. Mark G. Lohr Vice President of FMR; Treasurer of FMR, FMR (U.K.) Inc., FMR (Far East) Inc., and FIMM. Richard R. Mace Jr. Vice President of FMR and of funds advised by FMR. Charles A. Mangum Vice President of FMR and of a fund advised by FMR. Kevin McCarey Vice President of FMR and of a fund advised by FMR. Diane M. McLaughlin Vice President of FMR. Neal P. Miller Vice President of FMR. David L. Murphy Vice President of FMR and of funds advised by FMR. Scott A. Orr Vice President of FMR and of funds advised by FMR. Jacques Perold Vice President of FMR. Anne Punzak Vice President of FMR. Kennedy P. Richardson Vice President of FMR. Eric D. Roiter Senior Vice President and General Counsel of FMR and Secretary of funds advised by FMR. Mark S. Rzepczynski Vice President of FMR. Lee H. Sandwen Vice President of FMR. Patricia A. Satterthwaite Vice President of FMR and of a fund advised by FMR. Fergus Shiel Vice President of FMR. Richard A. Silver Vice President of FMR. Carol A. Smith-Fachetti Vice President of FMR. Steven J. Snider Vice President of FMR. Thomas T. Soviero Vice President of FMR and of a fund advised by FMR. Richard Spillane Senior Vice President of FMR; Associate Director and Senior Vice President of Equity funds advised by FMR; Previously, Senior Vice President and Director of Operations and Compliance of FMR (U.K.) Inc. Thomas M. Sprague Vice President of FMR and of funds advised by FMR. Robert E. Stansky Senior Vice President of FMR and Vice President of a fund advised by FMR. Scott D. Stewart Vice President of FMR. Cynthia L. Strauss Vice President of FMR. Thomas Sweeney Vice President of FMR and of a fund advised by FMR. Beth F. Terrana Senior Vice President of FMR and Vice President of a fund advised by FMR. Yoko Tilley Vice President of FMR. Joel C. Tillinghast Vice President of FMR and of a fund advised by FMR. Robert Tuckett Vice President of FMR. Jennifer Uhrig Vice President of FMR and of funds advised by FMR. George A. Vanderheiden Senior Vice President of FMR and Vice President of funds advised by FMR. Steven S. Wymer Vice President of FMR and of a fund advised by FMR.
(2) FIDELITY MANAGEMENT & RESEARCH (U.K.) INC. (FMR U.K.) 25 Lovat Lane, London, EC3R 8LL, England FMR U.K. provides investment advisory services to Fidelity Management & Research Company and Fidelity Management Trust Company. The directors and officers of the Sub-Adviser have held the following positions of a substantial nature during the past two fiscal years. Edward C. Johnson 3d Chairman of the Board and Director of FMR U.K., FMR, FMR Corp., FIMM, and FMR (Far East) Inc.; Chairman of the Executive Committee of FMR; President and Chief Executive Officer of FMR Corp.; Chairman of the Board and Representative Director of Fidelity Investments Japan Limited; President and Trustee of funds advised by FMR. Robert C. Pozen President and Director of FMR; Senior Vice President and Trustee of funds advised by FMR; President and Director of FIMM, FMR (U.K.) Inc., and FMR (Far East) Inc.; Previously, General Counsel, Managing Director, and Senior Vice President of FMR Corp. Mark G. Lohr Treasurer of FMR U.K., FMR, FMR (Far East) Inc., and FIMM; Previously, Vice President of FMR. Stephen G. Manning Assistant Treasurer of FMR U.K., FMR, FMR (Far East) Inc., and FIMM; Previously, Treasurer of FMR Corp. Francis V. Knox Compliance Officer of FMR U.K. Jay Freedman Clerk of FMR U.K., FMR (Far East) Inc., and FMR Corp.; Assistant Clerk of FMR; Secretary of FIMM. Sarah H. Zenoble Senior Vice President and Director of Operations andCompliance. (3) FIDELITY MANAGEMENT & RESEARCH COMPANY (FAR EAST) INC. (FMR FAR EAST) Shiroyama JT Mori Bldg., 4-3-1 Toranomon Minato-ku, Tokyo 105, Japan FMR Far East provides investment advisory services to Fidelity Management & Research Company and Fidelity Management Trust Company. The directors and officers of the Sub-Adviser have held the following positions of a substantial nature during the past two fiscal years. Edward C. Johnson 3d Chairman of the Board and Director of FMR Far East, FMR, FMR Corp., FIMM, and FMR (U.K.) Inc.; Chairman of the Executive Committee of FMR; President and Chief Executive Officer of FMR Corp.; Chairman of the Board and Representative Director of Fidelity Investments Japan Limited; President and Trustee of funds advised by FMR. Robert C. Pozen President and Director of FMR; Senior Vice President and Trustee of funds advised by FMR; President and Director of FIMM, FMR (U.K.) Inc., and FMR (Far East) Inc.; Previously, General Counsel, Managing Director, and Senior Vice President of FMR Corp. Billy Wilder Vice President of FMR Far East; President and Representative Director of Fidelity Investments Japan Limited. Mark G. Lohr Treasurer of FMR Far East, FMR, FMR (U.K.) Inc., and FIMM; Previously, Vice President of FMR. Stephen G. Manning Assistant Treasurer of FMR Far East, FMR, FMR (U.K.) Inc., and FIMM; Vice President and Treasurer of FMR Corp. Jay Freedman Clerk of FMR Far East, FMR (U.K.) Inc., and FMR Corp.; Assistant Clerk of FMR; Secretary of FIMM. Robert H. Auld Senior Vice President of FMR Far East. Item 29. Principal Underwriters (a) Fidelity Distributors Corporation (FDC) acts as distributor for most funds advised by FMR. (b) Name and Principal Positions and Offices Positions and Offices Business Address* With Underwriter With Registrant Edward C. Johnson 3d Director Trustee and President Michael Mlinac Director None James Curvey Director None Martha B. Willis President None Eric D. Roiter Senior Vice President Secretary Caron Ketchum Treasurer and Controller None Gary Greenstein Assistant Treasurer None Jay Freedman Assistant Clerk None Linda Holland Compliance Officer None * 82 Devonshire Street, Boston, MA (c) Not applicable. Item 30. Location of Accounts and Records All accounts, books, and other documents required to be maintained by Section 31a of the 1940 Act and the Rules promulgated thereunder are maintained by Fidelity Management & Research Company or Fidelity Service Company, Inc., 82 Devonshire Street, Boston, MA 02109, or the funds' respective custodians, The Chase Manhattan Bank (Fidelity Income & Growth Fund and Fidelity Fund), 1 Chase Manhattan Plaza, New York, N.Y. and Brown Brothers Harriman & Co. (Fidelity Fifty and new equity fund), 40 Water Street, Boston, MA. Item 31. Management Services Not applicable. Item 32. Undertakings (a) The Registrant undertakes for Fidelity Fifty and Fidelity Fund: 1) to call a meeting of shareholders for the purpose of voting upon the questions of removal of a trustee or trustees, when requested to do so by record holders of not less than 10% of its outstanding shares; and 2) to assist in communications with other shareholders pursuant to Section 16(c)(1) and (2), whenever shareholders meeting the qualifications set forth in Section 16(c) seek the opportunity to communicate with other shareholders with a view toward requesting a meeting. (b) The Registrant on behalf of Fidelity Fund and Fidelity Fifty, provided the information required by Item 5A is contained in the annual report, undertakes to furnish each person to whom a prospectus has been delivered, upon their request and without charge, a copy of the Registrant's latest annual report to shareholders. (c) The Registrant undertakes to file a Post-Effective Amendment, using financial statements for the funds filed pursuant to Rule 485(b) under the Securities Act of 1933 as amended, in Post-Effective Amendment No. 102 to Fidelity Hastings Street Trust, which need not be certified, within six months of the effectiveness of the funds' initial registration statement, provided such filing is then required by regulations of the Securities and Exchange Commission. SIGNATURES Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant certifies that it meets all of the requirements for the effectiveness of this Registration Statement pursuant to Rule 485(b) under the Securities Act of 1933 and has duly caused this Post-Effective Amendment No. 102 to the Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Boston, and Commonwealth of Massachusetts, on the 17th day of March 1998. FIDELITY HASTINGS STREET TRUST By /s/Edward C. Johnson 3d (dagger) Edward C. Johnson 3d, President Pursuant to the requirements of the Securities Act of 1933, this Registration Statement has been signed below by the following persons in the capacities and on the dates indicated. (Signature) (Title) (Date)
/s/Edward C. Johnson 3d (dagger) President and Trustee March 17, 1998 Edward C. Johnson 3d (Principal Executive Officer) /s/Richard A. Silver Treasurer March 17, 1998 Richard A. Silver /s/Robert C. Pozen Trustee March 17, 1998 Robert C. Pozen /s/Ralph F. Cox * Trustee March 17, 1998 Ralph F. Cox /s/Phyllis Burke Davis * Trustee March 17, 1998 Phyllis Burke Davis /s/Robert M. Gates ** Trustee March 17, 1998 Robert M. Gates /s/E. Bradley Jones * Trustee March 17, 1998 E. Bradley Jones /s/Donald J. Kirk * Trustee March 17, 1998 Donald J. Kirk /s/Peter S. Lynch * Trustee March 17, 1998 Peter S. Lynch /s/Marvin L. Mann * Trustee March 17, 1998 Marvin L. Mann /s/William O. McCoy * Trustee March 17, 1998 William O. McCoy /s/Gerald C. McDonough * Trustee March 17, 1998 Gerald C. McDonough /s/Thomas R. Williams * Trustee March 17, 1998 Thomas R. Williams
(dagger) Signatures affixed by Robert C. Pozen pursuant to a power of attorney dated July 17, 1997 and filed herewith. * Signature affixed by Robert C. Hacker pursuant to a power of attorney dated December 19, 1996 and filed herewith. ** Signature affixed by Robert C. Hacker pursuant to a power of attorney dated March 6, 1997 and filed herewith. POWER OF ATTORNEY I, the undersigned President and Director, Trustee, or General Partner, as the case may be, of the following investment companies:
Fidelity Aberdeen Street Trust Fidelity Hereford Street Trust Fidelity Advisor Series I Fidelity Income Fund Fidelity Advisor Series II Fidelity Institutional Cash Portfolios Fidelity Advisor Series III Fidelity Institutional Tax-Exempt Cash Portfolios Fidelity Advisor Series IV Fidelity Investment Trust Fidelity Advisor Series V Fidelity Magellan Fund Fidelity Advisor Series VI Fidelity Massachusetts Municipal Trust Fidelity Advisor Series VII Fidelity Money Market Trust Fidelity Advisor Series VIII Fidelity Mt. Vernon Street Trust Fidelity Beacon Street Trust Fidelity Municipal Trust Fidelity Boston Street Trust Fidelity Municipal Trust II Fidelity California Municipal Trust Fidelity New York Municipal Trust Fidelity California Municipal Trust II Fidelity New York Municipal Trust II Fidelity Capital Trust Fidelity Phillips Street Trust Fidelity Charles Street Trust Fidelity Puritan Trust Fidelity Commonwealth Trust Fidelity Revere Street Trust Fidelity Concord Street Trust Fidelity School Street Trust Fidelity Congress Street Fund Fidelity Securities Fund Fidelity Contrafund Fidelity Select Portfolios Fidelity Corporate Trust Fidelity Sterling Performance Portfolio, L.P. Fidelity Court Street Trust Fidelity Summer Street Trust Fidelity Court Street Trust II Fidelity Trend Fund Fidelity Covington Trust Fidelity U.S. Investments-Bond Fund, L.P. Fidelity Daily Money Fund Fidelity U.S. Investments-Government Securities Fidelity Destiny Portfolios Fund, L.P. Fidelity Deutsche Mark Performance Fidelity Union Street Trust Portfolio, L.P. Fidelity Union Street Trust II Fidelity Devonshire Trust Fidelity Yen Performance Portfolio, L.P. Fidelity Exchange Fund Newbury Street Trust Fidelity Financial Trust Variable Insurance Products Fund Fidelity Fixed-Income Trust Variable Insurance Products Fund II Fidelity Government Securities Fund Variable Insurance Products Fund III Fidelity Hastings Street Trust
in addition to any other investment company for which Fidelity Management & Research Company or an affiliate acts as investment adviser and for which the undersigned individual serves as President and Director, Trustee, or General Partner (collectively, the "Funds"), hereby constitute and appoint Robert C. Pozen my true and lawful attorney-in-fact, with full power of substitution, and with full power to him to sign for me and in my name in the appropriate capacity, all Registration Statements of the Funds on Form N-1A, Form N-8A, or any successor thereto, any and all subsequent Amendments, Pre-Effective Amendments, or Post-Effective Amendments to said Registration Statements on Form N-1A, Form N-8A, or any successor thereto, any Registration Statements on Form N-14, and any supplements or other instruments in connection therewith, and generally to do all such things in my name and on my behalf in connection therewith as said attorney-in-fact deems necessary or appropriate, to comply with the provisions of the Securities Act of 1933 and the Investment Company Act of 1940, and all related requirements of the Securities and Exchange Commission. I hereby ratify and confirm all that said attorney-in-fact or his substitutes may do or cause to be done by virtue hereof. This power of attorney is effective for all documents filed on or after August 1, 1997. WITNESS my hand on the date set forth below. /s/Edward C. Johnson 3d_ July 17, 1997 Edward C. Johnson 3d POWER OF ATTORNEY We, the undersigned Directors, Trustees, or General Partners, as the case may be, of the following investment companies:
Fidelity Aberdeen Street Trust Fidelity Government Securities Fund Fidelity Advisor Annuity Fund Fidelity Hastings Street Trust Fidelity Advisor Series I Fidelity Hereford Street Trust Fidelity Advisor Series II Fidelity Income Fund Fidelity Advisor Series III Fidelity Institutional Cash Portfolios Fidelity Advisor Series IV Fidelity Institutional Tax-Exempt Cash Portfolios Fidelity Advisor Series V Fidelity Institutional Trust Fidelity Advisor Series VI Fidelity Investment Trust Fidelity Advisor Series VII Fidelity Magellan Fund Fidelity Advisor Series VIII Fidelity Massachusetts Municipal Trust Fidelity Beacon Street Trust Fidelity Money Market Trust Fidelity Boston Street Trust Fidelity Mt. Vernon Street Trust Fidelity California Municipal Trust Fidelity Municipal Trust Fidelity California Municipal Trust II Fidelity Municipal Trust II Fidelity Capital Trust Fidelity New York Municipal Trust Fidelity Charles Street Trust Fidelity New York Municipal Trust II Fidelity Commonwealth Trust Fidelity Phillips Street Trust Fidelity Congress Street Fund Fidelity Puritan Trust Fidelity Contrafund Fidelity Revere Street Trust Fidelity Corporate Trust Fidelity School Street Trust Fidelity Court Street Trust Fidelity Securities Fund Fidelity Court Street Trust II Fidelity Select Portfolios Fidelity Covington Trust Fidelity Sterling Performance Portfolio, L.P. Fidelity Daily Money Fund Fidelity Summer Street Trust Fidelity Daily Tax-Exempt Fund Fidelity Trend Fund Fidelity Destiny Portfolios Fidelity U.S. Investments-Bond Fund, L.P. Fidelity Deutsche Mark Performance Fidelity U.S. Investments-Government Securities Portfolio, L.P. Fund, L.P. Fidelity Devonshire Trust Fidelity Union Street Trust Fidelity Exchange Fund Fidelity Union Street Trust II Fidelity Financial Trust Fidelity Yen Performance Portfolio, L.P. Fidelity Fixed-Income Trust Variable Insurance Products Fund Variable Insurance Products Fund II
plus any other investment company for which Fidelity Management & Research Company or an affiliate acts as investment adviser and for which the undersigned individual serves as Directors, Trustees, or General Partners (collectively, the "Funds"), hereby constitute and appoint Arthur J. Brown, Arthur C. Delibert, Stephanie A. Djinis, Robert C. Hacker, Thomas M. Leahey, Richard M. Phillips, and Dana L. Platt, each of them singly, our true and lawful attorneys-in-fact, with full power of substitution, and with full power to each of them, to sign for us and in our names in the appropriate capacities, all Registration Statements of the Funds on Form N-1A, Form N-8A or any successor thereto, any and all subsequent Amendments, Pre-Effective Amendments, or Post-Effective Amendments to said Registration Statements on Form N-1A or any successor thereto, any Registration Statements on Form N-14, and any supplements or other instruments in connection therewith, and generally to do all such things in our names and behalf in connection therewith as said attorneys-in-fact deems necessary or appropriate, to comply with the provisions of the Securities Act of 1933 and the Investment Company Act of 1940, and all related requirements of the Securities and Exchange Commission. I hereby ratify and confirm all that said attorneys-in-fact or their substitutes may do or cause to be done by virtue hereof. This power of attorney is effective for all documents filed on or after January 1, 1997. WITNESS our hands on this nineteenth day of December, 1996. /s/Edward C. Johnson 3d___________ /s/Peter S. Lynch________________ Edward C. Johnson 3d Peter S. Lynch /s/J. Gary Burkhead_______________ /s/William O. McCoy______________ J. Gary Burkhead William O. McCoy /s/Ralph F. Cox __________________ /s/Gerald C. McDonough___________ Ralph F. Cox Gerald C. McDonough /s/Phyllis Burke Davis_____________ /s/Marvin L. Mann________________ Phyllis Burke Davis Marvin L. Mann /s/E. Bradley Jones________________ /s/Thomas R. Williams ____________ E. Bradley Jones Thomas R. Williams /s/Donald J. Kirk __________________ Donald J. Kirk POWER OF ATTORNEY I, the undersigned Director, Trustee, or General Partner, as the case may be, of the following investment companies:
Fidelity Aberdeen Street Trust Fidelity Government Securities Fund Fidelity Advisor Annuity Fund Fidelity Hastings Street Trust Fidelity Advisor Series I Fidelity Hereford Street Trust Fidelity Advisor Series II Fidelity Income Fund Fidelity Advisor Series III Fidelity Institutional Cash Portfolios Fidelity Advisor Series IV Fidelity Institutional Tax-Exempt Cash Portfolios Fidelity Advisor Series V Fidelity Institutional Trust Fidelity Advisor Series VI Fidelity Investment Trust Fidelity Advisor Series VII Fidelity Magellan Fund Fidelity Advisor Series VIII Fidelity Massachusetts Municipal Trust Fidelity Beacon Street Trust Fidelity Money Market Trust Fidelity Boston Street Trust Fidelity Mt. Vernon Street Trust Fidelity California Municipal Trust Fidelity Municipal Trust Fidelity California Municipal Trust II Fidelity Municipal Trust II Fidelity Capital Trust Fidelity New York Municipal Trust Fidelity Charles Street Trust Fidelity New York Municipal Trust II Fidelity Commonwealth Trust Fidelity Phillips Street Trust Fidelity Congress Street Fund Fidelity Puritan Trust Fidelity Contrafund Fidelity Revere Street Trust Fidelity Corporate Trust Fidelity School Street Trust Fidelity Court Street Trust Fidelity Securities Fund Fidelity Court Street Trust II Fidelity Select Portfolios Fidelity Covington Trust Fidelity Sterling Performance Portfolio, L.P. Fidelity Daily Money Fund Fidelity Summer Street Trust Fidelity Daily Tax-Exempt Fund Fidelity Trend Fund Fidelity Destiny Portfolios Fidelity U.S. Investments-Bond Fund, L.P. Fidelity Deutsche Mark Performance Fidelity U.S. Investments-Government Securities Portfolio, L.P. Fund, L.P. Fidelity Devonshire Trust Fidelity Union Street Trust Fidelity Exchange Fund Fidelity Union Street Trust II Fidelity Financial Trust Fidelity Yen Performance Portfolio, L.P. Fidelity Fixed-Income Trust Variable Insurance Products Fund Variable Insurance Products Fund II
plus any other investment company for which Fidelity Management & Research Company or an affiliate acts as investment adviser and for which the undersigned individual serves as Director, Trustee, or General Partner (collectively, the "Funds"), hereby constitute and appoint Arthur J. Brown, Arthur C. Delibert, Stephanie A. Djinis, Robert C. Hacker, Thomas M. Leahey, Richard M. Phillips, and Dana L. Platt, each of them singly, my true and lawful attorneys-in-fact, with full power of substitution, and with full power to each of them, to sign for me and in my name in the appropriate capacities, all Registration Statements of the Funds on Form N-1A, Form N-8A or any successor thereto, any and all subsequent Amendments, Pre-Effective Amendments, or Post-Effective Amendments to said Registration Statements on Form N-1A or any successor thereto, any Registration Statements on Form N-14, and any supplements or other instruments in connection therewith, and generally to do all such things in my name and behalf in connection therewith as said attorneys-in-fact deem necessary or appropriate, to comply with the provisions of the Securities Act of 1933 and the Investment Company Act of 1940, and all related requirements of the Securities and Exchange Commission. I hereby ratify and confirm all that said attorneys-in-fact or their substitutes may do or cause to be done by virtue hereof. This power of attorney is effective for all documents filed on or after March 1, 1997. WITNESS my hand on the date set forth below. /s/Robert M. Gates March 6, 1997 Robert M. Gates EX-99.B5 2 Exhibit 5(c) FORM OF MANAGEMENT CONTRACT between FIDELITY HASTINGS STREET TRUST: and FIDELITY MANAGEMENT & RESEARCH COMPANY AGREEMENT made this __ day of ___ 199_, by and between Fidelity Hastings Street Trust, a Massachusetts business trust which may issue one or more series of shares of beneficial interest (hereinafter called the "Fund"), on behalf of ___________ (hereinafter called the "Portfolio"), and Fidelity Management & Research Company, a Massachusetts corporation (hereinafter called the "Adviser") as set forth in its entirety below. 1. (a) Investment Advisory Services. The Adviser undertakes to act as investment adviser of the Portfolio and shall, subject to the supervision of the Fund's Board of Trustees, direct the investments of the Portfolio in accordance with the investment objective, policies and limitations as provided in the Portfolio's Prospectus or other governing instruments, as amended from time to time, the Investment Company Act of 1940 and rules thereunder, as amended from time to time (the "1940 Act"), and such other limitations as the Portfolio may impose by notice in writing to the Adviser. The Adviser shall also furnish for the use of the Portfolio office space and all necessary office facilities, equipment and personnel for servicing the investments of the Portfolio; and shall pay the salaries and fees of all officers of the Fund, of all Trustees of the Fund who are "interested persons" of the Fund or of the Adviser and of all personnel of the Fund or the Adviser performing services relating to research, statistical and investment activities. The Adviser is authorized, in its discretion and without prior consultation with the Portfolio, to buy, sell, lend and otherwise trade in any stocks, bonds and other securities and investment instruments on behalf of the Portfolio. The investment policies and all other actions of the Portfolio are and shall at all times be subject to the control and direction of the Fund's Board of Trustees. (b) Management Services. The Adviser shall perform (or arrange for the performance by its affiliates of) the management and administrative services necessary for the operation of the Fund. The Adviser shall, subject to the supervision of the Board of Trustees, perform various services for the Portfolio, including but not limited to: (i) providing the Portfolio with office space, equipment and facilities (which may be its own) for maintaining its organization; (ii) on behalf of the Portfolio, supervising relations with, and monitoring the performance of, custodians, depositories, transfer and pricing agents, accountants, attorneys, underwriters, brokers and dealers, insurers and other persons in any capacity deemed to be necessary or desirable; (iii) preparing all general shareholder communications, including shareholder reports; (iv) conducting shareholder relations; (v) maintaining the Fund's existence and its records; (vi) during such times as shares are publicly offered, maintaining the registration and qualification of the Portfolio's shares under federal and state law; and (vii) investigating the development of and developing and implementing, if appropriate, management and shareholder services designed to enhance the value or convenience of the Portfolio as an investment vehicle. The Adviser shall also furnish such reports, evaluations, information or analyses to the Fund as the Fund's Board of Trustees may request from time to time or as the Adviser may deem to be desirable. The Adviser shall make recommendations to the Fund's Board of Trustees with respect to Fund policies, and shall carry out such policies as are adopted by the Trustees. The Adviser shall, subject to review by the Board of Trustees, furnish such other services as the Adviser shall from time to time determine to be necessary or useful to perform its obligations under this Contract. (c) The Adviser shall place all orders for the purchase and sale of portfolio securities for the Portfolio's account with brokers or dealers selected by the Adviser, which may include brokers or dealers affiliated with the Adviser. The Adviser shall use its best efforts to seek to execute portfolio transactions at prices which are advantageous to the Portfolio and at commission rates which are reasonable in relation to the benefits received. In selecting brokers or dealers qualified to execute a particular transaction, brokers or dealers may be selected who also provide brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of 1934) to the Portfolio and/or the other accounts over which the Adviser or its affiliates exercise investment discretion. The Adviser is authorized to pay a broker or dealer who provides such brokerage and research services a commission for executing a portfolio transaction for the Portfolio which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction if the Adviser determines in good faith that such amount of commission is reasonable in relation to the value of the brokerage and research services provided by such broker or dealer. This determination may be viewed in terms of either that particular transaction or the overall responsibilities which the Adviser and its affiliates have with respect to accounts over which they exercise investment discretion. The Trustees of the Fund shall periodically review the commissions paid by the Portfolio to determine if the commissions paid over representative periods of time were reasonable in relation to the benefits to the Portfolio. The Adviser shall, in acting hereunder, be an independent contractor. The Adviser shall not be an agent of the Portfolio. 2. It is understood that the Trustees, officers and shareholders of the Fund are or may be or become interested in the Adviser as directors, officers or otherwise and that directors, officers and stockholders of the Adviser are or may be or become similarly interested in the Fund, and that the Adviser may be or become interested in the Fund as a shareholder or otherwise. 3. The Adviser will be compensated on the following basis for the services and facilities to be furnished hereunder. The Adviser shall receive a monthly management fee, payable monthly as soon as practicable after the last day of each month, composed of a 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 Standard and Poor's 500 Index (the "Index"). The Performance Adjustment is not cumulative. An increased fee will result even though the performance of the Portfolio over some period of time shorter than the performance period has been behind that of the Index, and, conversely, a reduction in the fee will be made for a month even though the performance of the Portfolio over some period of time shorter than the performance period has been ahead of that of the Index. The Basic Fee and the Performance Adjustment will be computed as follows: (a) Basic Fee Rate: The annual Basic Fee Rate shall be the sum of the Group Fee Rate and the Individual Fund Fee Rate calculated to the nearest millionth decimal place as follows: (i) Group Fee Rate. The Group Fee Rate shall be based upon the monthly average of the net assets of the registered investment companies having Advisory and Service or Management Contracts with the Adviser (computed in the manner set forth in the fund's Declaration of Trust or other organizational document) determined as of the close of business on each business day throughout the month. The Group Fee Rate shall be determined on a cumulative basis pursuant to the following schedule: Average Net Assets Annualized Fee Rate (for each level) 0 - $ 3 billion .5200% 3 - 6 .4900 6 - 9 .4600 9 - 12 .4300 12 - 15 .4000 15 - 18 .3850 18 - 21 .3700 21 - 24 .3600 24 - 30 .3500 30 - 36 .3450 36 - 42 .3400 42 - 48 .3350 48 - 66 .3250 66 - 84 .3200 84 - 102 .3150 102 - 138 .3100 138 - 174 .3050 174 - 210 .3000 210 - 246 .2950 246 - 282 .2900 282 - 318 .2850 318 - 354 .2800 354 - 390 .2750 390 - 426 .2700 426 - 462 .2650 462 - 498 .2600 498 - 534 .2550 Over 534 .2500 (ii) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be 0.30%. (b) Basic Fee. One-twelfth of the Basic Fee Rate shall be applied to the average of the net assets of the Portfolio (computed in the manner set forth in the Fund's Declaration of Trust or other organizational document) determined as of the close of business on each business day throughout the month. The resulting dollar amount comprises the Basic Fee. (c) Performance Adjustment Rate: 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 .01% that the Portfolio's investment performance for the performance period was better or worse than the record of the Index as then constituted. The maximum performance adjustment rate is 0.20%. The performance period will commence with the first day of the first full month following the Portfolio's commencement of operations. During the first eleven months of the performance period for the Portfolio, there will be no performance adjustment. Starting with the twelfth month of the performance period, the performance adjustment will take effect. Following the twelfth month a new month will be added to the performance period until the performance period equals 36 months. Thereafter the performance period will consist of the current month plus the previous 35 months. The Portfolio's investment performance will be measured by comparing (i) the opening net asset value of one share of the Portfolio on the first business day of the performance period with (ii) the closing net asset value of one share of the Portfolio as of the last business day of such period. In computing the investment performance of the Portfolio and the investment record of the Index, distributions of realized capital gains, the value of capital gains taxes per share paid or payable on undistributed realized long-term capital gains accumulated to the end of such period and dividends paid out of investment income on the part of the Portfolio, and all cash distributions of the securities included in the Index, will be treated as reinvested in accordance with Rule 205-1 or any other applicable rules under the Investment Advisers Act of 1940, as the same from time to time may be amended. (d) Performance Adjustment. One-twelfth of the annual Performance Adjustment Rate will be applied to the average of the net assets of the Portfolio (computed in the manner set forth in the Fund's Declaration of Trust or other organizational document) determined as of the close of business on each business day throughout the month and the performance period. (e) In case of termination of this Contract during any month, the fee for that month shall be reduced proportionately on the basis of the number of business days during which it is in effect for that month. The Basic Fee Rate will be computed on the basis of and applied to net assets averaged over that month ending on the last business day on which this Contract is in effect. The amount of this Performance Adjustment to the Basic Fee will be computed on the basis of and applied to net assets averaged over the 36-month period ending on the last business day on which this Contract is in effect provided that if this Contract has been in effect less than 36 months, the computation will be made on the basis of the period of time during which it has been in effect. 4. It is understood that the Portfolio will pay all its expenses, which expenses payable by the Portfolio shall include, without limitation, (i) interest and taxes; (ii) brokerage commissions and other costs in connection with the purchase or sale of securities and other investment instruments; (iii) fees and expenses of the Fund's Trustees other than those who are "interested persons" of the Fund or the Adviser; (iv) legal and audit expenses; (v) custodian, registrar and transfer agent fees and expenses; (vi) fees and expenses related to the registration and qualification of the Fund and the Portfolio's shares for distribution under state and federal securities laws; (vii) expenses of printing and mailing reports and notices and proxy material to shareholders of the Portfolio; (viii) all other expenses incidental to holding meetings of the Portfolio's shareholders, including proxy solicitations therefor; (ix) a pro rata share, based on relative net assets of the Portfolio and other registered investment companies having Advisory and Service or Management Contracts with the Adviser, of 50% of insurance premiums for fidelity and other coverage; (x) its proportionate share of association membership dues; (xi) expenses of typesetting for printing Prospectuses and Statements of Additional Information and supplements thereto; (xii) expenses of printing and mailing Prospectuses and Statements of Additional Information and supplements thereto sent to existing shareholders; and (xiii) such non-recurring or extraordinary expenses as may arise, including those relating to actions, suits or proceedings to which the Portfolio is a party and the legal obligation which the Portfolio may have to indemnify the Fund's Trustees and officers with respect thereto. 5. The services of the Adviser to the Portfolio are not to be deemed exclusive, the Adviser being free to render services to others and engage in other activities, provided, however, that such other services and activities do not, during the term of this Contract, interfere, in a material manner, with the Adviser's ability to meet all of its obligations with respect to rendering services to the Portfolio hereunder. In the absence of willful misfeasance, bad faith, gross negligence or reckless disregard of obligations or duties hereunder on the part of the Adviser, the Adviser shall not be subject to liability to the Portfolio or to any shareholder of the Portfolio for any act or omission in the course of, or connected with, rendering services hereunder or for any losses that may be sustained in the purchase, holding or sale of any security or other investment instrument. 6. (a) Subject to prior termination as provided in sub-paragraph (d) of this paragraph 6, this Contract shall continue in force until July 31, 199_ and indefinitely thereafter, but only so long as the continuance after such date shall be specifically approved at least annually by vote of the Trustees of the Fund or by vote of a majority of the outstanding voting securities of the Portfolio. (b) This Contract may be modified by mutual consent subject to the provisions of Section 15 of the 1940 Act, as modified by or interpreted by any applicable order or orders of the Securities and Exchange Commission (the "Commission") or any rules or regulations adopted by, or interpretative releases of, the Commission. (c) In addition to the requirements of sub-paragraphs (a) and (b) of this paragraph 6, the terms of any continuance or modification of this Contract must have been approved by the vote of a majority of those Trustees of the Fund who are not parties to the Contract or interested persons of any such party, cast in person at a meeting called for the purpose of voting on such approval. (d) Either party hereto may, at any time on sixty (60) days' prior written notice to the other, terminate this Contract, without payment of any penalty, by action of its Trustees or Board of Directors, as the case may be, or with respect to the Portfolio by vote of a majority of the outstanding voting securities of the Portfolio. This Contract shall terminate automatically in the event of its assignment. 7. The Adviser is hereby expressly put on notice of the limitation of shareholder liability as set forth in the Fund's Declaration of Trust or other organizational document and agrees that the obligations assumed by the Fund pursuant to this Contract shall be limited in all cases to the Portfolio and its assets, and the Adviser shall not seek satisfaction of any such obligation from the shareholders or any shareholder of the Portfolio or any other Portfolios of the Fund. In addition, the Adviser shall not seek satisfaction of any such obligations from the Trustees or any individual Trustee. The Adviser understands that the rights and obligations of any Portfolio under the Declaration of Trust or other organizational document are separate and distinct from those of any and all other Portfolios. 8. This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to the choice of laws provisions thereof. The terms "vote of a majority of the outstanding voting securities," "assignment," and "interested persons," when used herein, shall have the respective meanings specified in the 1940 Act, as now in effect or as hereafter amended, and subject to such orders as may be granted by the Commission. IN WITNESS WHEREOF the parties have caused this instrument to be signed in their behalf by their respective officers thereunto duly authorized, and their respective seals to be hereunto affixed, all as of the date written above. [SIGNATURE LINES OMITTED] EX-99.B5 3 Exhibit 5(d) FORM OF MANAGEMENT CONTRACT between FIDELITY HASTINGS STREET TRUST: FIDELITY INCOME & GROWTH FUND and FIDELITY MANAGEMENT & RESEARCH COMPANY AGREEMENT made this __ day of __________, 1998, by and between Fidelity Hastings Street Trust, a Massachusetts business trust which may issue one or more series of shares of beneficial interest (hereinafter called the "Fund"), on behalf of Fidelity Hastings Street Trust: Fidelity Income & Growth Fund (hereinafter called the "Portfolio"), and Fidelity Management & Research Company, a Massachusetts corporation (hereinafter called the "Adviser") as set forth in its entirety below. 1. (a) Investment Advisory Services. The Adviser undertakes to act as investment adviser of the Portfolio and shall, subject to the supervision of the Fund's Board of Trustees, direct the investments of the Portfolio in accordance with the investment objective, policies and limitations as provided in the Portfolio's Prospectus or other governing instruments, as amended from time to time, the Investment Company Act of 1940 and rules thereunder, as amended from time to time (the "1940 Act"), and such other limitations as the Portfolio may impose by notice in writing to the Adviser. The Adviser shall also furnish for the use of the Portfolio office space and all necessary office facilities, equipment and personnel for servicing the investments of the Portfolio; and shall pay the salaries and fees of all officers of the Fund, of all Trustees of the Fund who are "interested persons" of the Fund or of the Adviser and of all personnel of the Fund or the Adviser performing services relating to research, statistical and investment activities. The Adviser is authorized, in its discretion and without prior consultation with the Portfolio, to buy, sell, lend and otherwise trade in any stocks, bonds and other securities and investment instruments on behalf of the Portfolio. The investment policies and all other actions of the Portfolio are and shall at all times be subject to the control and direction of the Fund's Board of Trustees. (b) Management Services. The Adviser shall perform (or arrange for the performance by its affiliates of) the management and administrative services necessary for the operation of the Fund. The Adviser shall, subject to the supervision of the Board of Trustees, perform various services for the Portfolio, including but not limited to: (i) providing the Portfolio with office space, equipment and facilities (which may be its own) for maintaining its organization; (ii) on behalf of the Portfolio, supervising relations with, and monitoring the performance of, custodians, depositories, transfer and pricing agents, accountants, attorneys, underwriters, brokers and dealers, insurers and other persons in any capacity deemed to be necessary or desirable; (iii) preparing all general shareholder communications, including shareholder reports; (iv) conducting shareholder relations; (v) maintaining the Fund's existence and its records; (vi) during such times as shares are publicly offered, maintaining the registration and qualification of the Portfolio's shares under federal and state law; and (vii) investigating the development of and developing and implementing, if appropriate, management and shareholder services designed to enhance the value or convenience of the Portfolio as an investment vehicle. The Adviser shall also furnish such reports, evaluations, information or analyses to the Fund as the Fund's Board of Trustees may request from time to time or as the Adviser may deem to be desirable. The Adviser shall make recommendations to the Fund's Board of Trustees with respect to Fund policies, and shall carry out such policies as are adopted by the Trustees. The Adviser shall, subject to review by the Board of Trustees, furnish such other services as the Adviser shall from time to time determine to be necessary or useful to perform its obligations under this Contract. (c) The Adviser shall place all orders for the purchase and sale of portfolio securities for the Portfolio's account with brokers or dealers selected by the Adviser, which may include brokers or dealers affiliated with the Adviser. The Adviser shall use its best efforts to seek to execute portfolio transactions at prices which are advantageous to the Portfolio and at commission rates which are reasonable in relation to the benefits received. In selecting brokers or dealers qualified to execute a particular transaction, brokers or dealers may be selected who also provide brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of 1934) to the Portfolio and/or the other accounts over which the Adviser or its affiliates exercise investment discretion. The Adviser is authorized to pay a broker or dealer who provides such brokerage and research services a commission for executing a portfolio transaction for the Portfolio which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction if the Adviser determines in good faith that such amount of commission is reasonable in relation to the value of the brokerage and research services provided by such broker or dealer. This determination may be viewed in terms of either that particular transaction or the overall responsibilities which the Adviser and its affiliates have with respect to accounts over which they exercise investment discretion. The Trustees of the Fund shall periodically review the commissions paid by the Portfolio to determine if the commissions paid over representative periods of time were reasonable in relation to the benefits to the Portfolio. The Adviser shall, in acting hereunder, be an independent contractor. The Adviser shall not be an agent of the Portfolio. 2. It is understood that the Trustees, officers and shareholders of the Fund are or may be or become interested in the Adviser as directors, officers or otherwise and that directors, officers and stockholders of the Adviser are or may be or become similarly interested in the Fund, and that the Adviser may be or become interested in the Fund as a shareholder or otherwise. 3. The Adviser will be compensated on the following basis for the services and facilities to be furnished hereunder. The Adviser shall receive a monthly management fee, payable monthly as soon as practicable after the last day of each month, composed of a Group Fee and an Individual Fund Fee. (a) Group Fee Rate. The Group Fee Rate shall be based upon the monthly average of the net assets of the registered investment companies having Advisory and Service or Management Contracts with the Adviser (computed in the manner set forth in the fund's Declaration of Trust or other organizational document) determined as of the close of business on each business day throughout the month. The Group Fee Rate shall be determined on a cumulative basis pursuant to the following schedule: Average Net Assets Annualized Fee Rate (for each level) 0 - $ 3 billion .5200% 3 - 6 .4900 6 - 9 .4600 9 - 12 .4300 12 - 15 .4000 15 - 18 .3850 18 - 21 .3700 21 - 24 .3600 24 - 30 .3500 30 - 36 .3450 36 - 42 .3400 42 - 48 .3350 48 - 66 .3250 66 - 84 .3200 84 - 102 .3150 102 - 138 .3100 138 - 174 .3050 174 - 210 .3000 210 - 246 .2950 246 - 282 .2900 282 - 318 .2850 318 - 354 .2800 354 - 390 .2750 390 - 426 .2700 426 - 462 .2650 462 - 498 .2600 498 - 534 .2550 Over 534 .2500 (b) Individual Fund Fee Rate. The Individual Fund Fee Rate shall be 0.20%. The sum of the Group Fee Rate, calculated as described above to the nearest millionth, and the Individual Fund Fee Rate shall constitute the Annual Management Fee Rate. One-twelfth of the Annual Management Fee Rate shall be applied to the average of the net assets of the Portfolio (computed in the manner set forth in the Fund's Declaration of Trust or other organizational document) determined as of the close of business on each business day throughout the month. (c) In case of termination of this Contract during any month, the fee for that month shall be reduced proportionately on the basis of the number of business days during which it is in effect, and the fee computed upon the average net assets for the business days it is so in effect for that month. 4. It is understood that the Portfolio will pay all its expenses, which expenses payable by the Portfolio shall include, without limitation, (i) interest and taxes; (ii) brokerage commissions and other costs in connection with the purchase or sale of securities and other investment instruments; (iii) fees and expenses of the Fund's Trustees other than those who are "interested persons" of the Fund or the Adviser; (iv) legal and audit expenses; (v) custodian, registrar and transfer agent fees and expenses; (vi) fees and expenses related to the registration and qualification of the Fund and the Portfolio's shares for distribution under state and federal securities laws; (vii) expenses of printing and mailing reports and notices and proxy material to shareholders of the Portfolio; (viii) all other expenses incidental to holding meetings of the Portfolio's shareholders, including proxy solicitations therefor; (ix) a pro rata share, based on relative net assets of the Portfolio and other registered investment companies having Advisory and Service or Management Contracts with the Adviser, of 50% of insurance premiums for fidelity and other coverage; (x) its proportionate share of association membership dues; (xi) expenses of typesetting for printing Prospectuses and Statements of Additional Information and supplements thereto; (xii) expenses of printing and mailing Prospectuses and Statements of Additional Information and supplements thereto sent to existing shareholders; and (xiii) such non-recurring or extraordinary expenses as may arise, including those relating to actions, suits or proceedings to which the Portfolio is a party and the legal obligation which the Portfolio may have to indemnify the Fund's Trustees and officers with respect thereto. 5. The services of the Adviser to the Portfolio are not to be deemed exclusive, the Adviser being free to render services to others and engage in other activities, provided, however, that such other services and activities do not, during the term of this Contract, interfere, in a material manner, with the Adviser's ability to meet all of its obligations with respect to rendering services to the Portfolio hereunder. In the absence of willful misfeasance, bad faith, gross negligence or reckless disregard of obligations or duties hereunder on the part of the Adviser, the Adviser shall not be subject to liability to the Portfolio or to any shareholder of the Portfolio for any act or omission in the course of, or connected with, rendering services hereunder or for any losses that may be sustained in the purchase, holding or sale of any security or other investment instrument. 6. (a) Subject to prior termination as provided in sub-paragraph (d) of this paragraph 6, this Contract shall continue in force until July 31, 19__ and indefinitely thereafter, but only so long as the continuance after such date shall be specifically approved at least annually by vote of the Trustees of the Fund or by vote of a majority of the outstanding voting securities of the Portfolio. (b) This Contract may be modified by mutual consent subject to the provisions of Section 15 of the 1940 Act, as modified by or interpreted by any applicable order or orders of the Securities and Exchange Commission (the "Commission") or any rules or regulations adopted by, or interpretative releases of, the Commission. (c) In addition to the requirements of sub-paragraphs (a) and (b) of this paragraph 6, the terms of any continuance or modification of this Contract must have been approved by the vote of a majority of those Trustees of the Fund who are not parties to the Contract or interested persons of any such party, cast in person at a meeting called for the purpose of voting on such approval. (d) Either party hereto may, at any time on sixty (60) days' prior written notice to the other, terminate this Contract, without payment of any penalty, by action of its Trustees or Board of Directors, as the case may be, or with respect to the Portfolio by vote of a majority of the outstanding voting securities of the Portfolio. This Contract shall terminate automatically in the event of its assignment. 7. The Adviser is hereby expressly put on notice of the limitation of shareholder liability as set forth in the Fund's Declaration of Trust or other organizational document and agrees that the obligations assumed by the Fund pursuant to this Contract shall be limited in all cases to the Portfolio and its assets, and the Adviser shall not seek satisfaction of any such obligation from the shareholders or any shareholder of the Portfolio or any other Portfolios of the Fund. In addition, the Adviser shall not seek satisfaction of any such obligations from the Trustees or any individual Trustee. The Adviser understands that the rights and obligations of any Portfolio under the Declaration of Trust or other organizational document are separate and distinct from those of any and all other Portfolios. 8. This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to the choice of laws provisions thereof. The terms "vote of a majority of the outstanding voting securities," "assignment," and "interested persons," when used herein, shall have the respective meanings specified in the 1940 Act, as now in effect or as hereafter amended, and subject to such orders as may be granted by the Commission. IN WITNESS WHEREOF the parties have caused this instrument to be signed in their behalf by their respective officers thereunto duly authorized, and their respective seals to be hereunto affixed, all as of the date written above. [SIGNATURE LINES OMITTED] EX-99.B5 4 Exhibit 5(i) FORM OF SUB-ADVISORY AGREEMENT BETWEEN FIDELITY MANAGEMENT & RESEARCH COMPANY AND FIDELITY MANAGEMENT & RESEARCH (U.K.) INC. AND FIDELITY HASTINGS STREET TRUST ON BEHALF OF ___________ AGREEMENT made this ___ day of ____, 199_, 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 Hastings Street Trust, a Massachusetts business trust which may issue one or more series of shares of beneficial interest (hereinafter called the "Trust") on behalf of ______________ (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, 199_ and indefinitely thereafter, but only so long as the continuance after such period shall be specifically approved at least annually by vote of the Trust's Board of Trustees or by vote of a majority of the outstanding voting securities of the Portfolio. (b) This Agreement may be modified by mutual consent of the Advisor, the Sub-Advisor and the Portfolio subject to the provisions of Section 15 of the 1940 Act, as modified by or interpreted by any applicable order or orders of the Securities and Exchange Commission (the "Commission") or any rules or regulations adopted by, or interpretative releases of, the Commission. (c) In addition to the requirements of subparagraphs (a) and (b) of this paragraph 9, the terms of any continuance or modification of this Agreement must have been approved by the vote of a majority of those Trustees of the Trust who are not parties to this Agreement or interested persons of any such party, cast in person at a meeting called for the purpose of voting on such approval. (d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any time on sixty (60) days' prior written notice to the other parties, terminate this Agreement, without payment of any penalty, by action of its Board of Trustees or Directors, or with respect to the Portfolio by vote of a majority of its outstanding voting securities. This Agreement shall terminate automatically in the event of its assignment. 10. Limitation of Liability: The Sub-Advisor is hereby expressly put on notice of the limitation of shareholder liability as set forth in the Declaration of Trust or other organizational document of the Trust and agrees that any obligations of the Trust or the Portfolio arising in connection with this Agreement shall be limited in all cases to the Portfolio and its assets, and the Sub-Advisor shall not seek satisfaction of any such obligation from the shareholders or any shareholder of the Portfolio. Nor shall the Sub-Advisor seek satisfaction of any such obligation from the Trustees or any individual Trustee. 11. Governing Law: This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to the choice of laws provisions thereof. The terms "registered investment company," "vote of a majority of the outstanding voting securities," "assignment," and "interested persons," when used herein, shall have the respective meanings specified in the 1940 Act as now in effect or as hereafter amended. IN WITNESS WHEREOF the parties hereto have caused this instrument to be signed in their behalf by their respective officers thereunto duly authorized, and their respective seals to be hereunto affixed, all as of the date written above. [SIGNATURE LINES OMITTED] EX-99.B5 5 Exhibit 5(j) FORM OF SUB-ADVISORY AGREEMENT BETWEEN FIDELITY MANAGEMENT & RESEARCH COMPANY AND FIDELITY MANAGEMENT & RESEARCH (FAR EAST) INC. AND FIDELITY HASTINGS STREET TRUST ON BEHALF OF ___________________ AGREEMENT made this ___ day of ____, 199_, 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 Hastings Street Trust, a Massachusetts business trust which may issue one or more series of shares of beneficial interest (hereinafter called the "Trust") on behalf of ____________ (hereinafter called the "Portfolio"). WHEREAS the Trust and the Advisor have entered into a Management Contract on behalf of the Portfolio, pursuant to which the Advisor is to act as investment manager of the Portfolio; and WHEREAS the Sub-Advisor and its subsidiaries and other affiliated persons have personnel in various locations throughout the world and have been formed in part for the purpose of researching and compiling information and recommendations with respect to the economies of various countries, and securities of issuers located in such countries, and providing investment advisory services in connection therewith; NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the Trust, the Advisor and the Sub-Advisor agree as follows: 1. Duties: The Advisor may, in its discretion, appoint the Sub-Advisor to perform one or more of the following services with respect to all or a portion of the investments of the Portfolio. The services and the portion of the investments of the Portfolio to be advised or managed by the Sub-Advisor shall be as agreed upon from time to time by the Advisor and the Sub-Advisor. The Sub-Advisor shall pay the salaries and fees of all personnel of the Sub-Advisor performing services for the Portfolio relating to research, statistical and investment activities. (a) INVESTMENT ADVICE: If and to the extent requested by the Advisor, the Sub-Advisor shall provide investment advice to the Portfolio and the Advisor with respect to all or a portion of the investments of the Portfolio, and in connection with such advice shall furnish the Portfolio and the Advisor such factual information, research reports and investment recommendations as the Advisor may reasonably require. Such information may include written and oral reports and analyses. (b) INVESTMENT MANAGEMENT: If and to the extent requested by the Advisor, the Sub-Advisor shall, subject to the supervision of the Advisor, manage all or a portion of the investments of the Portfolio in accordance with the investment objective, policies and limitations provided in the Portfolio's Prospectus or other governing instruments, as amended from time to time, the Investment Company Act of 1940 (the "1940 Act") and rules thereunder, as amended from time to time, and such other limitations as the Trust or Advisor may impose with respect to the Portfolio by notice to the Sub-Advisor. With respect to the portion of the investments of the Portfolio under its management, the Sub-Advisor is authorized to make investment decisions on behalf of the Portfolio with regard to any stock, bond, other security or investment instrument, and to place orders for the purchase and sale of such securities through such broker-dealers as the Sub-Advisor may select. The Sub-Advisor may also be authorized, but only to the extent such duties are delegated in writing by the Advisor, to provide additional investment management services to the Portfolio, including but not limited to services such as managing foreign currency investments, purchasing and selling or writing futures and options contracts, borrowing money, or lending securities on behalf of the Portfolio. All investment management and any other activities of the Sub-Advisor shall at all times be subject to the control and direction of the Advisor and the Trust's Board of Trustees. (c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or all of the services contemplated by this Agreement directly or through such of its subsidiaries or other affiliated persons as the Sub-Advisor shall determine; provided, however, that performance of such services through such subsidiaries or other affiliated persons shall have been approved by the Trust to the extent required pursuant to the 1940 Act and rules thereunder. 2. Information to be Provided to the Trust and the Advisor: The Sub-Advisor shall furnish such reports, evaluations, information or analyses to the Trust and the Advisor as the Trust's Board of Trustees or the Advisor may reasonably request from time to time, or as the Sub-Advisor may deem to be desirable. 3. Brokerage: In connection with the services provided under subparagraph (b) of paragraph 1 of this Agreement, the Sub-Advisor shall place all orders for the purchase and sale of portfolio securities for the Portfolio's account with brokers or dealers selected by the Sub-Advisor, which may include brokers or dealers affiliated with the Advisor or Sub-Advisor. The Sub-Advisor shall use its best efforts to seek to execute portfolio transactions at prices which are advantageous to the Portfolio and at commission rates which are reasonable in relation to the benefits received. In selecting brokers or dealers qualified to execute a particular transaction, brokers or dealers may be selected who also provide brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of l934) to the Portfolio and/or to the other accounts over which the Sub-Advisor or Advisor exercise investment discretion. The Sub-Advisor is authorized to pay a broker or dealer who provides such brokerage and research services a commission for executing a portfolio transaction for the Portfolio which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction if the Sub-Advisor determines in good faith that such amount of commission is reasonable in relation to the value of the brokerage and research services provided by such broker or dealer. This determination may be viewed in terms of either that particular transaction or the overall responsibilities which the Sub-Advisor has with respect to accounts over which it exercises investment discretion. The Trustees of the Trust shall periodically review the commissions paid by the Portfolio to determine if the commissions paid over representative periods of time were reasonable in relation to the benefits to the Portfolio. 4. Compensation: The Advisor shall compensate the Sub-Advisor on the following basis for the services to be furnished hereunder. (a) INVESTMENT ADVISORY FEE: For services provided under subparagraph (a) of paragraph 1 of this Agreement, the Advisor agrees to pay the Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory Fee shall be equal to 105% of the Sub-Advisor's costs incurred in connection with rendering the services referred to in subparagraph (a) of paragraph 1 of this Agreement. The Sub-Advisory Fee shall not be reduced to reflect expense reimbursements or fee waivers by the Advisor, if any, in effect from time to time. (b) INVESTMENT MANAGEMENT FEE: For services provided under subparagraph (b) of paragraph 1 of this Agreement, the Advisor agrees to pay the Sub-Advisor a monthly Investment Management Fee. The Investment Management Fee shall be equal to: (i) 50% of the monthly management fee rate (including performance adjustments, if any) that the Portfolio is obligated to pay the Advisor under its Management Contract with the Advisor, multiplied by: (ii) the fraction equal to the net assets of the Portfolio as to which the Sub-Advisor shall have provided investment management services divided by the net assets of the Portfolio for that month. If in any fiscal year the aggregate expenses of the Portfolio exceed any applicable expense limitation imposed by any state or federal securities laws or regulations, and the Advisor waives all or a portion of its management fee or reimburses the Portfolio for expenses to the extent required to satisfy such limitation, the Investment Management Fee paid to the Sub-Advisor will be reduced by 50% of the amount of such waivers or reimbursements multiplied by the fraction determined in (ii). If the Sub-Advisor reduces its fees to reflect such waivers or reimbursements and the Advisor subsequently recovers all or any portion of such waivers and reimbursements, then the Sub-Advisor shall be entitled to receive from the Advisor a proportionate share of the amount recovered. To the extent that waivers and reimbursements by the Advisor required by such limitations are in excess of the Advisor's management fee, the Investment Management Fee paid to the Sub-Advisor will be reduced to zero for that month, but in no event shall the Sub-Advisor be required to reimburse the Advisor for all or a portion of such excess reimbursements. (c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have provided both investment advisory services under subparagraph (a) and investment management services under subparagraph (b) of paragraph 1 for the same portion of the investments of the Portfolio for the same period, the fees paid to the Sub-Advisor with respect to such investments shall be calculated exclusively under subparagraph (b) of this paragraph 4. 5. Expenses: It is understood that the Portfolio will pay all of its expenses other than those expressly stated to be payable by the Sub-Advisor hereunder or by the Advisor under the Management Contract with the Portfolio, which expenses payable by the Portfolio shall include, without limitation, (i) interest and taxes; (ii) brokerage commissions and other costs in connection with the purchase or sale of securities and other investment instruments; (iii) fees and expenses of the Trust's Trustees other than those who are "interested persons" of the Trust, the Sub-Advisor or the Advisor; (iv) legal and audit expenses; (v) custodian, registrar and transfer agent fees and expenses; (vi) fees and expenses related to the registration and qualification of the Trust and the Portfolio's shares for distribution under state and federal securities laws; (vii) expenses of printing and mailing reports and notices and proxy material to shareholders of the Portfolio; (viii) all other expenses incidental to holding meetings of the Portfolio's shareholders, including proxy solicitations therefore; (ix) a pro rata share, based on relative net assets of the Portfolio and other registered investment companies having Advisory and Service or Management Contracts with the Advisor, of 50% of insurance premiums for fidelity and other coverage; (x) its proportionate share of association membership dues; (xi) expenses of typesetting for printing Prospectuses and Statements of Additional Information and supplements thereto; (xii) expenses of printing and mailing Prospectuses and Statements of Additional Information and supplements thereto sent to existing shareholders; and (xiii) such non-recurring or extraordinary expenses as may arise, including those relating to actions, suits or proceedings to which the Portfolio is a party and the legal obligation which the Portfolio may have to indemnify the Trust's Trustees and officers with respect thereto. 6. Interested Persons: It is understood that Trustees, officers, and shareholders of the Trust are or may be or become interested in the Advisor or the Sub-Advisor as directors, officers or otherwise and that directors, officers and stockholders of the Advisor or the Sub-Advisor are or may be or become similarly interested in the Trust, and that the Advisor or the Sub-Advisor may be or become interested in the Trust as a shareholder or otherwise. 7. Services to Other Companies or Accounts: The services of the Sub-Advisor to the Advisor are not to be deemed to be exclusive, the Sub-Advisor being free to render services to others and engage in other activities, provided, however, that such other services and activities do not, during the term of this Agreement, interfere, in a material manner, with the Sub-Advisor's ability to meet all of its obligations hereunder. The Sub-Advisor shall for all purposes be an independent contractor and not an agent or employee of the Advisor or the Trust. 8. Standard of Care: In the absence of willful misfeasance, bad faith, gross negligence or reckless disregard of obligations or duties hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be subject to liability to the Advisor, the Trust or to any shareholder of the Portfolio for any act or omission in the course of, or connected with, rendering services hereunder or for any losses that may be sustained in the purchase, holding or sale of any security. 9. Duration and Termination of Agreement; Amendments: (a) Subject to prior termination as provided in subparagraph (d) of this paragraph 9, this Agreement shall continue in force until July 31, 199_ and indefinitely thereafter, but only so long as the continuance after such period shall be specifically approved at least annually by vote of the Trust's Board of Trustees or by vote of a majority of the outstanding voting securities of the Portfolio. (b) This Agreement may be modified by mutual consent of the Advisor, the Sub-Advisor and the Portfolio subject to the provisions of Section 15 of the 1940 Act, as modified by or interpreted by any applicable order or orders of the Securities and Exchange Commission (the "Commission") or any rules or regulations adopted by, or interpretative releases of, the Commission. (c) In addition to the requirements of subparagraphs (a) and (b) of this paragraph 9, the terms of any continuance or modification of this Agreement must have been approved by the vote of a majority of those Trustees of the Trust who are not parties to this Agreement or interested persons of any such party, cast in person at a meeting called for the purpose of voting on such approval. (d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any time on sixty (60) days' prior written notice to the other parties, terminate this Agreement, without payment of any penalty, by action of its Board of Trustees or Directors, or with respect to the Portfolio by vote of a majority of its outstanding voting securities. This Agreement shall terminate automatically in the event of its assignment. 10. Limitation of Liability: The Sub-Advisor is hereby expressly put on notice of the limitation of shareholder liability as set forth in the Declaration of Trust or other organizational document of the Trust and agrees that any obligations of the Trust or the Portfolio arising in connection with this Agreement shall be limited in all cases to the Portfolio and its assets, and the Sub-Advisor shall not seek satisfaction of any such obligation from the shareholders or any shareholder of the Portfolio. Nor shall the Sub-Advisor seek satisfaction of any such obligation from the Trustees or any individual Trustee. 11. Governing Law: This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to the choice of laws provisions thereof. The terms "registered investment company," "vote of a majority of the outstanding voting securities," "assignment," and "interested persons," when used herein, shall have the respective meanings specified in the 1940 Act as now in effect or as hereafter amended. IN WITNESS WHEREOF the parties hereto have caused this instrument to be signed in their behalf by their respective officers thereunto duly authorized, and their respective seals to be hereunto affixed, all as of the date written above. [SIGNATURE LINES OMITTED] EX-99.B5 6 Exhibit 5(k) Form of SUB-ADVISORY AGREEMENT between FIDELITY MANAGEMENT & RESEARCH COMPANY and FIDELITY MANAGEMENT & RESEARCH (U.K.) INC. and FIDELITY HASTINGS STREET TRUST ON BEHALF OF FIDELITY INCOME & GROWTH FUND AGREEMENT made this ___ day of ____, 1998, by and between Fidelity Management & Research Company, a Massachusetts corporation with principal offices at 82 Devonshire Street, Boston, Massachusetts (hereinafter called the "Advisor"); Fidelity Management & Research (U.K.) Inc. (hereinafter called the "Sub-Advisor"); and Fidelity Hastings Street Trust, a Massachusetts business trust which may issue one or more series of shares of beneficial interest (hereinafter called the "Trust") on behalf of Fidelity Income & Growth Fund (hereinafter called the "Portfolio"). WHEREAS the Trust and the Advisor have entered into a Management Contract on behalf of the Portfolio, pursuant to which the Advisor is to act as investment manager of the Portfolio; and WHEREAS the Sub-Advisor and its subsidiaries and other affiliated persons have personnel in various locations throughout the world and have been formed in part for the purpose of researching and compiling information and recommendations with respect to the economies of various countries, and securities of issuers located in such countries, and providing investment advisory services in connection therewith; NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the Trust, the Advisor and the Sub-Advisor agree as follows: 1. Duties: The Advisor may, in its discretion, appoint the Sub-Advisor to perform one or more of the following services with respect to all or a portion of the investments of the Portfolio. The services and the portion of the investments of the Portfolio to be advised or managed by the Sub-Advisor shall be as agreed upon from time to time by the Advisor and the Sub-Advisor. The Sub-Advisor shall pay the salaries and fees of all personnel of the Sub-Advisor performing services for the Portfolio relating to research, statistical and investment activities. (a) INVESTMENT ADVICE: If and to the extent requested by the Advisor, the Sub-Advisor shall provide investment advice to the Portfolio and the Advisor with respect to all or a portion of the investments of the Portfolio, and in connection with such advice shall furnish the Portfolio and the Advisor such factual information, research reports and investment recommendations as the Advisor may reasonably require. Such information may include written and oral reports and analyses. (b) INVESTMENT MANAGEMENT: If and to the extent requested by the Advisor, the Sub-Advisor shall, subject to the supervision of the Advisor, manage all or a portion of the investments of the Portfolio in accordance with the investment objective, policies and limitations provided in the Portfolio's Prospectus or other governing instruments, as amended from time to time, the Investment Company Act of 1940 (the "1940 Act") and rules thereunder, as amended from time to time, and such other limitations as the Trust or Advisor may impose with respect to the Portfolio by notice to the Sub-Advisor. With respect to the portion of the investments of the Portfolio under its management, the Sub-Advisor is authorized to make investment decisions on behalf of the Portfolio with regard to any stock, bond, other security or investment instrument, and to place orders for the purchase and sale of such securities through such broker-dealers as the Sub-Advisor may select. The Sub-Advisor may also be authorized, but only to the extent such duties are delegated in writing by the Advisor, to provide additional investment management services to the Portfolio, including but not limited to services such as managing foreign currency investments, purchasing and selling or writing futures and options contracts, borrowing money or lending securities on behalf of the Portfolio. All investment management and any other activities of the Sub-Advisor shall at all times be subject to the control and direction of the Advisor and the Trust's Board of Trustees. (c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or all of the services contemplated by this Agreement directly or through such of its subsidiaries or other affiliated persons as the Sub-Advisor shall determine; provided, however, that performance of such services through such subsidiaries or other affiliated persons shall have been approved by the Trust to the extent required pursuant to the 1940 Act and rules thereunder. 2. Information to be Provided to the Trust and the Advisor: The Sub-Advisor shall furnish such reports, evaluations, information or analyses to the Trust and the Advisor as the Trust's Board of Trustees or the Advisor may reasonably request from time to time, or as the Sub-Advisor may deem to be desirable. 3. Brokerage: In connection with the services provided under subparagraph (b) of paragraph 1 of this Agreement, the Sub-Advisor shall place all orders for the purchase and sale of portfolio securities for the Portfolio's account with brokers or dealers selected by the Sub-Advisor, which may include brokers or dealers affiliated with the Advisor or Sub-Advisor. The Sub-Advisor shall use its best efforts to seek to execute portfolio transactions at prices which are advantageous to the Portfolio and at commission rates which are reasonable in relation to the benefits received. In selecting brokers or dealers qualified to execute a particular transaction, brokers or dealers may be selected who also provide brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of l934) to the Portfolio and/or to the other accounts over which the Sub-Advisor or Advisor exercise investment discretion. The Sub-Advisor is authorized to pay a broker or dealer who provides such brokerage and research services a commission for executing a portfolio transaction for the Portfolio which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction if the Sub-Advisor determines in good faith that such amount of commission is reasonable in relation to the value of the brokerage and research services provided by such broker or dealer. This determination may be viewed in terms of either that particular transaction or the overall responsibilities which the Sub-Advisor has with respect to accounts over which it exercises investment discretion. The Trustees of the Trust shall periodically review the commissions paid by the Portfolio to determine if the commissions paid over representative periods of time were reasonable in relation to the benefits to the Portfolio. 4. Compensation: The Advisor shall compensate the Sub-Advisor on the following basis for the services to be furnished hereunder. (a) INVESTMENT ADVISORY FEE: For services provided under subparagraph (a) of paragraph 1 of this Agreement, the Advisor agrees to pay the Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory Fee shall be equal to 110% of the Sub-Advisor's costs incurred in connection with rendering the services referred to in subparagraph (a) of paragraph 1 of this Agreement. The Sub-Advisory Fee shall not be reduced to reflect expense reimbursements or fee waivers by the Advisor, if any, in effect from time to time. (b) INVESTMENT MANAGEMENT FEE: For services provided under subparagraph (b) of paragraph 1 of this Agreement, the Advisor agrees to pay the Sub-Advisor a monthly Investment Management Fee. The Investment Management Fee shall be equal to: (i) 50% of the monthly management fee rate (including performance adjustments, if any) that the Portfolio is obligated to pay the Advisor under its Management Contract with the Advisor, multiplied by: (ii) the fraction equal to the net assets of the Portfolio as to which the Sub-Advisor shall have provided investment management services divided by the net assets of the Portfolio for that month. If in any fiscal year the aggregate expenses of the Portfolio exceed any applicable expense limitation imposed by any state or federal securities laws or regulations, and the Advisor waives all or a portion of its management fee or reimburses the Portfolio for expenses to the extent required to satisfy such limitation, the Investment Management Fee paid to the Sub-Advisor will be reduced by 50% of the amount of such waivers or reimbursements multiplied by the fraction determined in (ii). If the Sub-Advisor reduces its fees to reflect such waivers or reimbursements and the Advisor subsequently recovers all or any portion of such waivers or reimbursements, then the Sub-Advisor shall be entitled to receive from the Advisor a proportionate share of the amount recovered. To the extent that waivers and reimbursements by the Advisor required by such limitations are in excess of the Advisor's management fee, the Investment Management Fee paid to the Sub-Advisor will be reduced to zero for that month, but in no event shall the Sub-Advisor be required to reimburse the Advisor for all or a portion of such excess reimbursements. (c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have provided both investment advisory services under subparagraph (a) and investment management services under subparagraph (b) of paragraph (1) for the same portion of the investments of the Portfolio for the same period, the fees paid to the Sub-Advisor with respect to such investments shall be calculated exclusively under subparagraph (b) of this paragraph 4. 5. Expenses: It is understood that the Portfolio will pay all of its expenses other than those expressly stated to be payable by the Sub-Advisor hereunder or by the Advisor under the Management Contract with the Portfolio, which expenses payable by the Portfolio shall include, without limitation, (i) interest and taxes; (ii) brokerage commissions and other costs in connection with the purchase or sale of securities and other investment instruments; (iii) fees and expenses of the Trust's Trustees other than those who are "interested persons" of the Trust, the Sub-Advisor or the Advisor; (iv) legal and audit expenses; (v) custodian, registrar and transfer agent fees and expenses; (vi) fees and expenses related to the registration and qualification of the Trust and the Portfolio's shares for distribution under state and federal securities laws; (vii) expenses of printing and mailing reports and notices and proxy material to shareholders of the Portfolio; (viii) all other expenses incidental to holding meetings of the Portfolio's shareholders, including proxy solicitations therefore; (ix) a pro rata share, based on relative net assets of the Portfolio and other registered investment companies having Advisory and Service or Management Contracts with the Advisor, of 50% of insurance premiums for fidelity and other coverage; (x) its proportionate share of association membership dues; (xi) expenses of typesetting for printing Prospectuses and Statements of Additional Information and supplements thereto; (xii) expenses of printing and mailing Prospectuses and Statements of Additional Information and supplements thereto sent to existing shareholders; and (xiii) such non-recurring or extraordinary expenses as may arise, including those relating to actions, suits or proceedings to which the Portfolio is a party and the legal obligation which the Portfolio may have to indemnify the Trust's Trustees and officers with respect thereto. 6. Interested Persons: It is understood that Trustees, officers, and shareholders of the Trust are or may be or become interested in the Advisor or the Sub-Advisor as directors, officers or otherwise and that directors, officers and stockholders of the Advisor or the Sub-Advisor are or may be or become similarly interested in the Trust, and that the Advisor or the Sub-Advisor may be or become interested in the Trust as a shareholder or otherwise. 7. Services to Other Companies or Accounts: The services of the Sub-Advisor to the Advisor are not to be deemed to be exclusive, the Sub-Advisor being free to render services to others and engage in other activities, provided, however, that such other services and activities do not, during the term of this Agreement, interfere, in a material manner, with the Sub-Advisor's ability to meet all of its obligations hereunder. The Sub-Advisor shall for all purposes be an independent contractor and not an agent or employee of the Advisor or the Trust. 8. Standard of Care: In the absence of willful misfeasance, bad faith, gross negligence or reckless disregard of obligations or duties hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be subject to liability to the Advisor, the Trust or to any shareholder of the Portfolio for any act or omission in the course of, or connected with, rendering services hereunder or for any losses that may be sustained in the purchase, holding or sale of any security. 9. Duration and Termination of Agreement; Amendments: (a) Subject to prior termination as provided in subparagraph (d) of this paragraph 9, this Agreement shall continue in force until July 31 , 199_ and indefinitely thereafter, but only so long as the continuance after such period shall be specifically approved at least annually by vote of the Trust's Board of Trustees or by vote of a majority of the outstanding voting securities of the Portfolio. (b) This Agreement may be modified by mutual consent of the Advisor, the Sub-Advisor and the Portfolio subject to the provisions of Section 15 of the 1940 Act, as modified by or interpreted by any applicable order or orders of the Securities and Exchange Commission (the "Commission") or any rules or regulations adopted by, or interpretative releases of, the Commission. (c) In addition to the requirements of subparagraphs (a) and (b) of this paragraph 9, the terms of any continuance or modification of this Agreement must have been approved by the vote of a majority of those Trustees of the Trust who are not parties to this Agreement or interested persons of any such party, cast in person at a meeting called for the purpose of voting on such approval. (d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any time on sixty (60) days' prior written notice to the other parties, terminate this Agreement, without payment of any penalty, by action of its Board of Trustees or Directors, or with respect to the Portfolio by vote of a majority of its outstanding voting securities. This Agreement shall terminate automatically in the event of its assignment. 10. Limitation of Liability: The Sub-Advisor is hereby expressly put on notice of the limitation of shareholder liability as set forth in the Declaration of Trust or other organizational document of the Trust and agrees that any obligations of the Trust or the Portfolio arising in connection with this Agreement shall be limited in all cases to the Portfolio and its assets, and the Sub-Advisor shall not seek satisfaction of any such obligation from the shareholders or any shareholder of the Portfolio. Nor shall the Sub-Advisor seek satisfaction of any such obligation from the Trustees or any individual Trustee. 11. Governing Law: This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to the choice of laws provisions thereof. The terms "registered investment company," "vote of a majority of the outstanding voting securities," "assignment," and "interested persons," when used herein, shall have the respective meanings specified in the 1940 Act as now in effect or as hereafter amended. IN WITNESS WHEREOF the parties hereto have caused this instrument to be signed in their behalf by their respective officers thereunto duly authorized, and their respective seals to be hereunto affixed, all as of the date written above. [SIGNATURE LINES OMITTED] EX-99.B5 7 Exhibit 5(l) Form of SUB-ADVISORY AGREEMENT between FIDELITY MANAGEMENT & RESEARCH COMPANY and FIDELITY MANAGEMENT & RESEARCH (Far East) INC. and FIDELITY HASTINGS STREET TRUST ON BEHALF OF FIDELITY INCOME & GROWTH FUND AGREEMENT made this ___ day of ____, 199_, 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 Hastings Street Trust, a Massachusetts business trust which may issue one or more series of shares of beneficial interest (hereinafter called the "Trust") on behalf of Fidelity Income & Growth Fund (hereinafter called the "Portfolio"). WHEREAS the Trust and the Advisor have entered into a Management Contract on behalf of the Portfolio, pursuant to which the Advisor is to act as investment manager of the Portfolio; and WHEREAS the Sub-Advisor and its subsidiaries and other affiliated persons have personnel in various locations throughout the world and have been formed in part for the purpose of researching and compiling information and recommendations with respect to the economies of various countries, and securities of issuers located in such countries, and providing investment advisory services in connection therewith; NOW, THEREFORE, in consideration of the premises and the mutual promises hereinafter set forth, the Trust, the Advisor and the Sub-Advisor agree as follows: 1. Duties: The Advisor may, in its discretion, appoint the Sub-Advisor to perform one or more of the following services with respect to all or a portion of the investments of the Portfolio. The services and the portion of the investments of the Portfolio to be advised or managed by the Sub-Advisor shall be as agreed upon from time to time by the Advisor and the Sub-Advisor. The Sub-Advisor shall pay the salaries and fees of all personnel of the Sub-Advisor performing services for the Portfolio relating to research, statistical and investment activities. (a) INVESTMENT ADVICE: If and to the extent requested by the Advisor, the Sub-Advisor shall provide investment advice to the Portfolio and the Advisor with respect to all or a portion of the investments of the Portfolio, and in connection with such advice shall furnish the Portfolio and the Advisor such factual information, research reports and investment recommendations as the Advisor may reasonably require. Such information may include written and oral reports and analyses. (b) INVESTMENT MANAGEMENT: If and to the extent requested by the Advisor, the Sub-Advisor shall, subject to the supervision of the Advisor, manage all or a portion of the investments of the Portfolio in accordance with the investment objective, policies and limitations provided in the Portfolio's Prospectus or other governing instruments, as amended from time to time, the Investment Company Act of 1940 (the "1940 Act") and rules thereunder, as amended from time to time, and such other limitations as the Trust or Advisor may impose with respect to the Portfolio by notice to the Sub-Advisor. With respect to the portion of the investments of the Portfolio under its management, the Sub-Advisor is authorized to make investment decisions on behalf of the Portfolio with regard to any stock, bond, other security or investment instrument, and to place orders for the purchase and sale of such securities through such broker-dealers as the Sub-Advisor may select. The Sub-Advisor may also be authorized, but only to the extent such duties are delegated in writing by the Advisor, to provide additional investment management services to the Portfolio, including but not limited to services such as managing foreign currency investments, purchasing and selling or writing futures and options contracts, borrowing money, or lending securities on behalf of the Portfolio. All investment management and any other activities of the Sub-Advisor shall at all times be subject to the control and direction of the Advisor and the Trust's Board of Trustees. (c) SUBSIDIARIES AND AFFILIATES: The Sub-Advisor may perform any or all of the services contemplated by this Agreement directly or through such of its subsidiaries or other affiliated persons as the Sub-Advisor shall determine; provided, however, that performance of such services through such subsidiaries or other affiliated persons shall have been approved by the Trust to the extent required pursuant to the 1940 Act and rules thereunder. 2. Information to be Provided to the Trust and the Advisor: The Sub-Advisor shall furnish such reports, evaluations, information or analyses to the Trust and the Advisor as the Trust's Board of Trustees or the Advisor may reasonably request from time to time, or as the Sub-Advisor may deem to be desirable. 3. Brokerage: In connection with the services provided under subparagraph (b) of paragraph 1 of this Agreement, the Sub-Advisor shall place all orders for the purchase and sale of portfolio securities for the Portfolio's account with brokers or dealers selected by the Sub-Advisor, which may include brokers or dealers affiliated with the Advisor or Sub-Advisor. The Sub-Advisor shall use its best efforts to seek to execute portfolio transactions at prices which are advantageous to the Portfolio and at commission rates which are reasonable in relation to the benefits received. In selecting brokers or dealers qualified to execute a particular transaction, brokers or dealers may be selected who also provide brokerage and research services (as those terms are defined in Section 28(e) of the Securities Exchange Act of l934) to the Portfolio and/or to the other accounts over which the Sub-Advisor or Advisor exercise investment discretion. The Sub-Advisor is authorized to pay a broker or dealer who provides such brokerage and research services a commission for executing a portfolio transaction for the Portfolio which is in excess of the amount of commission another broker or dealer would have charged for effecting that transaction if the Sub-Advisor determines in good faith that such amount of commission is reasonable in relation to the value of the brokerage and research services provided by such broker or dealer. This determination may be viewed in terms of either that particular transaction or the overall responsibilities which the Sub-Advisor has with respect to accounts over which it exercises investment discretion. The Trustees of the Trust shall periodically review the commissions paid by the Portfolio to determine if the commissions paid over representative periods of time were reasonable in relation to the benefits to the Portfolio. 4. Compensation: The Advisor shall compensate the Sub-Advisor on the following basis for the services to be furnished hereunder. (a) INVESTMENT ADVISORY FEE: For services provided under subparagraph (a) of paragraph 1 of this Agreement, the Advisor agrees to pay the Sub-Advisor a monthly Sub-Advisory Fee. The Sub-Advisory Fee shall be equal to 105% of the Sub-Advisor's costs incurred in connection with rendering the services referred to in subparagraph (a) of paragraph 1 of this Agreement. The Sub-Advisory Fee shall not be reduced to reflect expense reimbursements or fee waivers by the Advisor, if any, in effect from time to time. (b) INVESTMENT MANAGEMENT FEE: For services provided under subparagraph (b) of paragraph 1 of this Agreement, the Advisor agrees to pay the Sub-Advisor a monthly Investment Management Fee. The Investment Management Fee shall be equal to: (i) 50% of the monthly management fee rate (including performance adjustments, if any) that the Portfolio is obligated to pay the Advisor under its Management Contract with the Advisor, multiplied by: (ii) the fraction equal to the net assets of the Portfolio as to which the Sub-Advisor shall have provided investment management services divided by the net assets of the Portfolio for that month. If in any fiscal year the aggregate expenses of the Portfolio exceed any applicable expense limitation imposed by any state or federal securities laws or regulations, and the Advisor waives all or a portion of its management fee or reimburses the Portfolio for expenses to the extent required to satisfy such limitation, the Investment Management Fee paid to the Sub-Advisor will be reduced by 50% of the amount of such waivers or reimbursements multiplied by the fraction determined in (ii). If the Sub-Advisor reduces its fees to reflect such waivers or reimbursements and the Advisor subsequently recovers all or any portion of such waivers and reimbursements, then the Sub-Advisor shall be entitled to receive from the Advisor a proportionate share of the amount recovered. To the extent that waivers and reimbursements by the Advisor required by such limitations are in excess of the Advisor's management fee, the Investment Management Fee paid to the Sub-Advisor will be reduced to zero for that month, but in no event shall the Sub-Advisor be required to reimburse the Advisor for all or a portion of such excess reimbursements. (c) PROVISION OF MULTIPLE SERVICES: If the Sub-Advisor shall have provided both investment advisory services under subparagraph (a) and investment management services under subparagraph (b) of paragraph 1 for the same portion of the investments of the Portfolio for the same period, the fees paid to the Sub-Advisor with respect to such investments shall be calculated exclusively under subparagraph (b) of this paragraph 4. 5. Expenses: It is understood that the Portfolio will pay all of its expenses other than those expressly stated to be payable by the Sub-Advisor hereunder or by the Advisor under the Management Contract with the Portfolio, which expenses payable by the Portfolio shall include, without limitation, (i) interest and taxes; (ii) brokerage commissions and other costs in connection with the purchase or sale of securities and other investment instruments; (iii) fees and expenses of the Trust's Trustees other than those who are "interested persons" of the Trust, the Sub-Advisor or the Advisor; (iv) legal and audit expenses; (v) custodian, registrar and transfer agent fees and expenses; (vi) fees and expenses related to the registration and qualification of the Trust and the Portfolio's shares for distribution under state and federal securities laws; (vii) expenses of printing and mailing reports and notices and proxy material to shareholders of the Portfolio; (viii) all other expenses incidental to holding meetings of the Portfolio's shareholders, including proxy solicitations therefore; (ix) a pro rata share, based on relative net assets of the Portfolio and other registered investment companies having Advisory and Service or Management Contracts with the Advisor, of 50% of insurance premiums for fidelity and other coverage; (x) its proportionate share of association membership dues; (xi) expenses of typesetting for printing Prospectuses and Statements of Additional Information and supplements thereto; (xii) expenses of printing and mailing Prospectuses and Statements of Additional Information and supplements thereto sent to existing shareholders; and (xiii) such non-recurring or extraordinary expenses as may arise, including those relating to actions, suits or proceedings to which the Portfolio is a party and the legal obligation which the Portfolio may have to indemnify the Trust's Trustees and officers with respect thereto. 6. Interested Persons: It is understood that Trustees, officers, and shareholders of the Trust are or may be or become interested in the Advisor or the Sub-Advisor as directors, officers or otherwise and that directors, officers and stockholders of the Advisor or the Sub-Advisor are or may be or become similarly interested in the Trust, and that the Advisor or the Sub-Advisor may be or become interested in the Trust as a shareholder or otherwise. 7. Services to Other Companies or Accounts: The services of the Sub-Advisor to the Advisor are not to be deemed to be exclusive, the Sub-Advisor being free to render services to others and engage in other activities, provided, however, that such other services and activities do not, during the term of this Agreement, interfere, in a material manner, with the Sub-Advisor's ability to meet all of its obligations hereunder. The Sub-Advisor shall for all purposes be an independent contractor and not an agent or employee of the Advisor or the Trust. 8. Standard of Care: In the absence of willful misfeasance, bad faith, gross negligence or reckless disregard of obligations or duties hereunder on the part of the Sub-Advisor, the Sub-Advisor shall not be subject to liability to the Advisor, the Trust or to any shareholder of the Portfolio for any act or omission in the course of, or connected with, rendering services hereunder or for any losses that may be sustained in the purchase, holding or sale of any security. 9. Duration and Termination of Agreement; Amendments: (a) Subject to prior termination as provided in subparagraph (d) of this paragraph 9, this Agreement shall continue in force until July 31, 199_ and indefinitely thereafter, but only so long as the continuance after such period shall be specifically approved at least annually by vote of the Trust's Board of Trustees or by vote of a majority of the outstanding voting securities of the Portfolio. (b) This Agreement may be modified by mutual consent of the Advisor, the Sub-Advisor and the Portfolio subject to the provisions of Section 15 of the 1940 Act, as modified by or interpreted by any applicable order or orders of the Securities and Exchange Commission (the "Commission") or any rules or regulations adopted by, or interpretative releases of, the Commission. (c) In addition to the requirements of subparagraphs (a) and (b) of this paragraph 9, the terms of any continuance or modification of this Agreement must have been approved by the vote of a majority of those Trustees of the Trust who are not parties to this Agreement or interested persons of any such party, cast in person at a meeting called for the purpose of voting on such approval. (d) Either the Advisor, the Sub-Advisor or the Portfolio may, at any time on sixty (60) days' prior written notice to the other parties, terminate this Agreement, without payment of any penalty, by action of its Board of Trustees or Directors, or with respect to the Portfolio by vote of a majority of its outstanding voting securities. This Agreement shall terminate automatically in the event of its assignment. 10. Limitation of Liability: The Sub-Advisor is hereby expressly put on notice of the limitation of shareholder liability as set forth in the Declaration of Trust or other organizational document of the Trust and agrees that any obligations of the Trust or the Portfolio arising in connection with this Agreement shall be limited in all cases to the Portfolio and its assets, and the Sub-Advisor shall not seek satisfaction of any such obligation from the shareholders or any shareholder of the Portfolio. Nor shall the Sub-Advisor seek satisfaction of any such obligation from the Trustees or any individual Trustee. 11. Governing Law: This Agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to the choice of laws provisions thereof. The terms "registered investment company," "vote of a majority of the outstanding voting securities," "assignment," and "interested persons," when used herein, shall have the respective meanings specified in the 1940 Act as now in effect or as hereafter amended. IN WITNESS WHEREOF the parties hereto have caused this instrument to be signed in their behalf by their respective officers thereunto duly authorized, and their respective seals to be hereunto affixed, all as of the date written above. [SIGNATURE LINES OMITTED] EX-99.B6 8 Exhibit 6(f) FORM OF GENERAL DISTRIBUTION AGREEMENT between FIDELITY HASTINGS STREET TRUST and FIDELITY DISTRIBUTORS CORPORATION Agreement made this ___ day of , 19 , between Fidelity Hastings Street Trust, a Massachusetts business trust having its principal place of business in Boston, Massachusetts and which may issue one or more series of beneficial interest ("Issuer"), with respect to shares of _______________, a series of the Issuer, and Fidelity Distributors Corporation, a Massachusetts corporation having its principal place of business in Boston, Massachusetts ("Distributors"). In consideration of the mutual promises and undertakings herein contained, the parties agree as follows: 1. Sale of Shares - The Issuer grants to Distributors the right to sell shares on behalf of the Issuer during the term of this Agreement and subject to the registration requirements of the Securities Act of 1933, as amended ("1933 Act"), and of the laws governing the sale of securities in the various states ("Blue Sky Laws") under the following terms and conditions: Distributors (i) shall have the right to sell, as agent on behalf of the Issuer, shares authorized for issue and registered under the 1933 Act, and (ii) may sell shares under offers of exchange, if available, between and among the funds advised by Fidelity Management & Research Company ("FMR") or any of its affiliates. 2. Sale of Shares by the Issuer - The rights granted to Distributors shall be nonexclusive in that the Issuer reserves the right to sell its shares to investors on applications received and accepted by the Issuer. Further, the Issuer reserves the right to issue shares in connection with the merger or consolidation, or acquisition by the Issuer through purchase or otherwise, with any other investment company, trust, or personal holding company. 3. Shares Covered by this Agreement - This Agreement shall apply to unissued shares of the Issuer, shares of the Issuer held in its treasury in the event that in the discretion of the Issuer treasury shares shall be sold, and shares of the Issuer repurchased for resale. 4. Public Offering Price - Except as otherwise noted in the Issuer's current Prospectus and/or Statement of Additional Information, all shares sold to investors by Distributors or the Issuer will be sold at the public offering price. The public offering price for all accepted subscriptions will be the net asset value per share, as determined in the manner described in the Issuer's current Prospectus and/or Statement of Additional Information, plus a sales charge (if any) described in the Issuer's current Prospectus and/or Statement of Additional Information. The Issuer shall in all cases receive the net asset value per share on all sales. If a sales charge is in effect, Distributors shall have the right subject to such rules or regulations of the Securities and Exchange Commission as may then be in effect pursuant to Section 22 of the Investment Company Act of 1940 to pay a portion of the sales charge to dealers who have sold shares of the Issuer. If a fee in connection with shareholder redemptions is in effect, the Issuer shall collect the fee on behalf of Distributors and, unless otherwise agreed upon by the Issuer and Distributors, Distributors shall be entitled to receive all of such fees. 5. Suspension of Sales - If and whenever the determination of net asset value is suspended and until such suspension is terminated, no further orders for shares shall be processed by Distributors except such unconditional orders as may have been placed with Distributors before it had knowledge of the suspension. In addition, the Issuer reserves the right to suspend sales and Distributors' authority to process orders for shares on behalf of the Issuer if, in the judgment of the Issuer, it is in the best interests of the Issuer to do so. Suspension will continue for such period as may be determined by the Issuer. 6. Solicitation of Sales - In consideration of these rights granted to Distributors, Distributors agrees to use all reasonable efforts, consistent with its other business, to secure purchasers for shares of the Issuer. This shall not prevent Distributors from entering into like arrangements (including arrangements involving the payment of underwriting commissions) with other issuers. This does not obligate Distributors to register as a broker or dealer under the Blue Sky Laws of any jurisdiction in which it is not now registered or to maintain its registration in any jurisdiction in which it is now registered. If a sales charge is in effect, Distributors shall have the right to enter into sales agreements with dealers of its choice for the sale of shares of the Issuer to the public at the public offering price only and fix in such agreements the portion of the sales charge which may be retained by dealers, provided that the Issuer shall approve the form of the dealer agreement and the dealer discounts set forth therein and shall evidence such approval by filing said form of dealer agreement and amendments thereto as an exhibit to its currently effective Registration Statement under the 1933 Act. 7. Authorized Representations - Distributors is not authorized by the Issuer to give any information or to make any representations other than those contained in the appropriate registration statements or Prospectuses and Statements of Additional Information filed with the Securities and Exchange Commission under the 1933 Act (as these registration statements, Prospectuses and Statements of Additional Information may be amended from time to time), or contained in shareholder reports or other material that may be prepared by or on behalf of the Issuer for Distributors' use. This shall not be construed to prevent Distributors from preparing and distributing sales literature or other material as it may deem appropriate. 8. Portfolio Securities - Portfolio securities of the Issuer may be bought or sold by or through Distributors, and Distributors may participate directly or indirectly in brokerage commissions or "spreads" for transactions in portfolio securities of the Issuer. 9. Registration of Shares - The Issuer agrees that it will take all action necessary to register shares under the 1933 Act (subject to the necessary approval of its shareholders) so that there will be available for sale the number of shares Distributors may reasonably be expected to sell. The Issuer shall make available to Distributors such number of copies of its currently effective Prospectus and Statement of Additional Information as Distributors may reasonably request. The Issuer shall furnish to Distributors copies of all information, financial statements and other papers which Distributors may reasonably request for use in connection with the distribution of shares of the Issuer. 10. Expenses - The Issuer shall pay all fees and expenses (a) in connection with the preparation, setting in type and filing of any registration statement, Prospectus and Statement of Additional Information under the 1933 Act and amendments for the issue of its shares, (b) in connection with the registration and qualification of shares for sale in the various states in which the Board of Trustees of the Issuer shall determine it advisable to qualify such shares for sale (including registering the Issuer as a broker or dealer or any officer of the Issuer as agent or salesman in any state), (c) of preparing, setting in type, printing and mailing any report or other communication to shareholders of the Issuer in their capacity as such, and (d) of preparing, setting in type, printing and mailing Prospectuses, Statements of Additional Information and any supplements thereto sent to existing shareholders. As provided in the Distribution and Service Plan adopted by the Issuer, it is recognized by the Issuer that FMR may make payment to Distributors with respect to any expenses incurred in the distribution of shares of the Issuer, such payments payable from the past profits or other resources of FMR including management fees paid to it by the Issuer. 11. Indemnification - The Issuer agrees to indemnify and hold harmless Distributors and each of its directors and officers and each person, if any, who controls Distributors within the meaning of Section 15 of the 1933 Act against any loss, liability, claim, damages or expense (including the reasonable cost of investigating or defending any alleged loss, liability, claim, damages, or expense and reasonable counsel fees incurred in connection therewith) arising by reason of any person acquiring any shares, based upon the ground that the registration statement, Prospectus, Statement of Additional Information, shareholder reports or other information filed or made public by the Issuer (as from time to time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated or necessary in order to make the statements not misleading under the 1933 Act, or any other statute or the common law. However, the Issuer does not agree to indemnify Distributors or hold it harmless to the extent that the statement or omission was made in reliance upon, and in conformity with, information furnished to the Issuer by or on behalf of Distributors. In no case (i) is the indemnity of the Issuer in favor of Distributors or any person indemnified to be deemed to protect Distributors or any person against any liability to the Issuer or its security holders to which Distributors or such person would otherwise be subject by reason of wilful misfeasance, bad faith or gross negligence in the performance of its duties or by reason of its reckless disregard of its obligations and duties under this Agreement, or (ii) is the Issuer to be liable under its indemnity agreement contained in this paragraph with respect to any claim made against Distributors or any person indemnified unless Distributors or person, as the case may be, shall have notified the Issuer in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon Distributors or any such person (or after Distributors or such person shall have received notice of service on any designated agent). However, failure to notify the Issuer of any claim shall not relieve the Issuer from any liability which it may have to Distributors or any person against whom such action is brought otherwise than on account of its indemnity agreement contained in this paragraph. The Issuer shall be entitled to participate at its own expense in the defense, or, if it so elects, to assume the defense of any suit brought to enforce any claims, but if the Issuer elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to Distributors or person or persons, defendant or defendants in the suit. In the event the Issuer elects to assume the defense of any suit and retain counsel, Distributors, officers or directors or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional counsel retained by them. If the Issuer does not elect to assume the defense of any suit, it will reimburse Distributors, officers or directors or controlling person or persons, defendant or defendants in the suit, for the reasonable fees and expenses of any counsel retained by them. The Issuer agrees to notify Distributors promptly of the commencement of any litigation or proceedings against it or any of its officers or trustees in connection with the issuance or sale of any of the shares. Distributors also covenants and agrees that it will indemnify and hold harmless the Issuer and each of its Board members and officers and each person, if any, who controls the Issuer within the meaning of Section 15 of the 1933 Act, against any loss, liability, damages, claim or expense (including the reasonable cost of investigating or defending any alleged loss, liability, damages, claim or expense and reasonable counsel fees incurred in connection therewith) arising by reason of any person acquiring any shares, based upon the 1933 Act or any other statute or common law, alleging any wrongful act of Distributors or any of its employees or alleging that the registration statement, Prospectus, Statement of Additional Information, shareholder reports or other information filed or made public by the Issuer (as from time to time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated or necessary in order to make the statements not misleading, insofar as the statement or omission was made in reliance upon, and in conformity with information furnished to the Issuer by or on behalf of Distributors. In no case (i) is the indemnity of Distributors in favor of the Issuer or any person indemnified to be deemed to protect the Issuer or any person against any liability to which the Issuer or such person would otherwise be subject by reason of willful misfeasance, bad faith or gross negligence in the performance of its duties or by reason of its reckless disregard of its obligations and duties under this Agreement, or (ii) is Distributors to be liable under its indemnity agreement contained in this paragraph with respect to any claim made against the Issuer or any person indemnified unless the Issuer or person, as the case may be, shall have notified Distributors in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon the Issuer or any such person (or after the Issuer or such person shall have received notice of service on any designated agent). However, failure to notify Distributors of any claim shall not relieve Distributors from any liability which it may have to the Issuer or any person against whom the action is brought otherwise than on account of its indemnity agreement contained in this paragraph. In the case of any notice to Distributors, it shall be entitled to participate, at its own expense, in the defense or, if it so elects, to assume the defense of any suit brought to enforce the claim, but if Distributors elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to the Issuer, to its officers and Board and to any controlling person or persons, defendant or defendants in the suit. In the event that Distributors elects to assume the defense of any suit and retain counsel, the Issuer or controlling persons, defendant or defendants in the suit, shall bear the fees and expense of any additional counsel retained by them. If Distributors does not elect to assume the defense of any suit, it will reimburse the Issuer, officers and Board or controlling person or persons, defendant or defendants in the suit, for the reasonable fees and expenses of any counsel retained by them. Distributors agrees to notify the Issuer promptly of the commencement of any litigation or proceedings against it in connection with the issue and sale of any of the shares. 12. Effective Date - This agreement shall be effective upon its execution, and unless terminated as provided, shall continue in force until March 31, 199 and thereafter from year to year, provided continuance is approved annually by the vote of a majority of the Board members of the Issuer, and by the vote of those Board members of the Issuer who are not "interested persons" of the Issuer and, if a plan under Rule 12b-1 under the Investment Company Act of 1940 is in effect, by the vote of those Board members of the Issuer who are not "interested persons" of the Issuer and who are not parties to the Distribution and Service Plan or this Agreement and have no financial interest in the operation of the Distribution and Service Plan or in any agreements related to the Distribution and Service Plan, cast in person at a meeting called for the purpose of voting on the approval. This Agreement shall automatically terminate in the event of its assignment. As used in this paragraph, the terms "assignment" and "interested persons" shall have the respective meanings specified in the Investment Company Act of 1940 as now in effect or as hereafter amended. In addition to termination by failure to approve continuance or by assignment, this Agreement may at any time be terminated by either party upon not less than sixty days' prior written notice to the other party. 13. Notice - Any notice required or permitted to be given by either party to the other shall be deemed sufficient if sent by registered or certified mail, postage prepaid, addressed by the party giving notice to the other party at the last address furnished by the other party to the party giving notice: if to the Issuer, at 82 Devonshire Street, Boston, Massachusetts, and if to Distributors, at 82 Devonshire Street, Boston, Massachusetts. 14. Limitation of Liability - Distributors is expressly put on notice of the limitation of shareholder liability as set forth in the Declaration of Trust or other organizational document of the Issuer and agrees that the obligations assumed by the Issuer under this contract shall be limited in all cases to the Issuer and its assets. Distributors shall not seek satisfaction of any such obligation from the shareholders or any shareholder of the Issuer. Nor shall Distributors seek satisfaction of any such obligation from the Trustees or any individual Trustee of the Issuer. Distributors understands that the rights and obligations of each series of shares of the Issuer under the Issuer's Declaration of Trust or other organizational document are separate and distinct from those of any and all other series. 15. This agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to the choice of laws provisions thereof. IN WITNESS WHEREOF, the Issuer has executed this instrument in its name and behalf, and its seal affixed, by one of its officers duly authorized, and Distributors has executed this instrument in its name and behalf by one of its officers duly authorized, as of the day and year first above written. [SIGNATURE LINES OMITTED] EX-99.B6 9 Exhibit 6(g) FORM OF GENERAL DISTRIBUTION AGREEMENT between FIDELITY HASTINGS STREET TRUST and FIDELITY DISTRIBUTORS CORPORATION Agreement made this ___ day of , 19 , between Fidelity Hastings Street Trust, a Massachusetts business trust having its principal place of business in Boston, Massachusetts and which may issue one or more series of beneficial interest ("Issuer"), with respect to shares of Fidelity Income & Growth Fund, a series of the Issuer, and Fidelity Distributors Corporation, a Massachusetts corporation having its principal place of business in Boston, Massachusetts ("Distributors"). In consideration of the mutual promises and undertakings herein contained, the parties agree as follows: 1. Sale of Shares - The Issuer grants to Distributors the right to sell shares on behalf of the Issuer during the term of this Agreement and subject to the registration requirements of the Securities Act of 1933, as amended ("1933 Act"), and of the laws governing the sale of securities in the various states ("Blue Sky Laws") under the following terms and conditions: Distributors (i) shall have the right to sell, as agent on behalf of the Issuer, shares authorized for issue and registered under the 1933 Act, and (ii) may sell shares under offers of exchange, if available, between and among the funds advised by Fidelity Management & Research Company ("FMR") or any of its affiliates. 2. Sale of Shares by the Issuer - The rights granted to Distributors shall be nonexclusive in that the Issuer reserves the right to sell its shares to investors on applications received and accepted by the Issuer. Further, the Issuer reserves the right to issue shares in connection with the merger or consolidation, or acquisition by the Issuer through purchase or otherwise, with any other investment company, trust, or personal holding company. 3. Shares Covered by this Agreement - This Agreement shall apply to unissued shares of the Issuer, shares of the Issuer held in its treasury in the event that in the discretion of the Issuer treasury shares shall be sold, and shares of the Issuer repurchased for resale. 4. Public Offering Price - Except as otherwise noted in the Issuer's current Prospectus and/or Statement of Additional Information, all shares sold to investors by Distributors or the Issuer will be sold at the public offering price. The public offering price for all accepted subscriptions will be the net asset value per share, as determined in the manner described in the Issuer's current Prospectus and/or Statement of Additional Information, plus a sales charge (if any) described in the Issuer's current Prospectus and/or Statement of Additional Information. The Issuer shall in all cases receive the net asset value per share on all sales. If a sales charge is in effect, Distributors shall have the right subject to such rules or regulations of the Securities and Exchange Commission as may then be in effect pursuant to Section 22 of the Investment Company Act of 1940 to pay a portion of the sales charge to dealers who have sold shares of the Issuer. If a fee in connection with shareholder redemptions is in effect, the Issuer shall collect the fee on behalf of Distributors and, unless otherwise agreed upon by the Issuer and Distributors, Distributors shall be entitled to receive all of such fees. 5. Suspension of Sales - If and whenever the determination of net asset value is suspended and until such suspension is terminated, no further orders for shares shall be processed by Distributors except such unconditional orders as may have been placed with Distributors before it had knowledge of the suspension. In addition, the Issuer reserves the right to suspend sales and Distributors' authority to process orders for shares on behalf of the Issuer if, in the judgment of the Issuer, it is in the best interests of the Issuer to do so. Suspension will continue for such period as may be determined by the Issuer. 6. Solicitation of Sales - In consideration of these rights granted to Distributors, Distributors agrees to use all reasonable efforts, consistent with its other business, to secure purchasers for shares of the Issuer. This shall not prevent Distributors from entering into like arrangements (including arrangements involving the payment of underwriting commissions) with other issuers. This does not obligate Distributors to register as a broker or dealer under the Blue Sky Laws of any jurisdiction in which it is not now registered or to maintain its registration in any jurisdiction in which it is now registered. If a sales charge is in effect, Distributors shall have the right to enter into sales agreements with dealers of its choice for the sale of shares of the Issuer to the public at the public offering price only and fix in such agreements the portion of the sales charge which may be retained by dealers, provided that the Issuer shall approve the form of the dealer agreement and the dealer discounts set forth therein and shall evidence such approval by filing said form of dealer agreement and amendments thereto as an exhibit to its currently effective Registration Statement under the 1933 Act. 7. Authorized Representations - Distributors is not authorized by the Issuer to give any information or to make any representations other than those contained in the appropriate registration statements or Prospectuses and Statements of Additional Information filed with the Securities and Exchange Commission under the 1933 Act (as these registration statements, Prospectuses and Statements of Additional Information may be amended from time to time), or contained in shareholder reports or other material that may be prepared by or on behalf of the Issuer for Distributors' use. This shall not be construed to prevent Distributors from preparing and distributing sales literature or other material as it may deem appropriate. 8. Portfolio Securities - Portfolio securities of the Issuer may be bought or sold by or through Distributors, and Distributors may participate directly or indirectly in brokerage commissions or "spreads" for transactions in portfolio securities of the Issuer. 9. Registration of Shares - The Issuer agrees that it will take all action necessary to register shares under the 1933 Act (subject to the necessary approval of its shareholders) so that there will be available for sale the number of shares Distributors may reasonably be expected to sell. The Issuer shall make available to Distributors such number of copies of its currently effective Prospectus and Statement of Additional Information as Distributors may reasonably request. The Issuer shall furnish to Distributors copies of all information, financial statements and other papers which Distributors may reasonably request for use in connection with the distribution of shares of the Issuer. 10. Expenses - The Issuer shall pay all fees and expenses (a) in connection with the preparation, setting in type and filing of any registration statement, Prospectus and Statement of Additional Information under the 1933 Act and amendments for the issue of its shares, (b) in connection with the registration and qualification of shares for sale in the various states in which the Board of Trustees of the Issuer shall determine it advisable to qualify such shares for sale (including registering the Issuer as a broker or dealer or any officer of the Issuer as agent or salesman in any state), (c) of preparing, setting in type, printing and mailing any report or other communication to shareholders of the Issuer in their capacity as such, and (d) of preparing, setting in type, printing and mailing Prospectuses, Statements of Additional Information and any supplements thereto sent to existing shareholders. As provided in the Distribution and Service Plan adopted by the Issuer, it is recognized by the Issuer that FMR may make payment to Distributors with respect to any expenses incurred in the distribution of shares of the Issuer, such payments payable from the past profits or other resources of FMR including management fees paid to it by the Issuer. 11. Indemnification - The Issuer agrees to indemnify and hold harmless Distributors and each of its directors and officers and each person, if any, who controls Distributors within the meaning of Section 15 of the 1933 Act against any loss, liability, claim, damages or expense (including the reasonable cost of investigating or defending any alleged loss, liability, claim, damages, or expense and reasonable counsel fees incurred in connection therewith) arising by reason of any person acquiring any shares, based upon the ground that the registration statement, Prospectus, Statement of Additional Information, shareholder reports or other information filed or made public by the Issuer (as from time to time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated or necessary in order to make the statements not misleading under the 1933 Act, or any other statute or the common law. However, the Issuer does not agree to indemnify Distributors or hold it harmless to the extent that the statement or omission was made in reliance upon, and in conformity with, information furnished to the Issuer by or on behalf of Distributors. In no case (i) is the indemnity of the Issuer in favor of Distributors or any person indemnified to be deemed to protect Distributors or any person against any liability to the Issuer or its security holders to which Distributors or such person would otherwise be subject by reason of willful misfeasance, bad faith or gross negligence in the performance of its duties or by reason of its reckless disregard of its obligations and duties under this Agreement, or (ii) is the Issuer to be liable under its indemnity agreement contained in this paragraph with respect to any claim made against Distributors or any person indemnified unless Distributors or person, as the case may be, shall have notified the Issuer in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon Distributors or any such person (or after Distributors or such person shall have received notice of service on any designated agent). However, failure to notify the Issuer of any claim shall not relieve the Issuer from any liability which it may have to Distributors or any person against whom such action is brought otherwise than on account of its indemnity agreement contained in this paragraph. The Issuer shall be entitled to participate at its own expense in the defense, or, if it so elects, to assume the defense of any suit brought to enforce any claims, but if the Issuer elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to Distributors or person or persons, defendant or defendants in the suit. In the event the Issuer elects to assume the defense of any suit and retain counsel, Distributors, officers or directors or controlling person or persons, defendant or defendants in the suit, shall bear the fees and expenses of any additional counsel retained by them. If the Issuer does not elect to assume the defense of any suit, it will reimburse Distributors, officers or directors or controlling person or persons, defendant or defendants in the suit, for the reasonable fees and expenses of any counsel retained by them. The Issuer agrees to notify Distributors promptly of the commencement of any litigation or proceedings against it or any of its officers or trustees in connection with the issuance or sale of any of the shares. Distributors also covenants and agrees that it will indemnify and hold harmless the Issuer and each of its Board members and officers and each person, if any, who controls the Issuer within the meaning of Section 15 of the 1933 Act, against any loss, liability, damages, claim or expense (including the reasonable cost of investigating or defending any alleged loss, liability, damages, claim or expense and reasonable counsel fees incurred in connection therewith) arising by reason of any person acquiring any shares, based upon the 1933 Act or any other statute or common law, alleging any wrongful act of Distributors or any of its employees or alleging that the registration statement, Prospectus, Statement of Additional Information, shareholder reports or other information filed or made public by the Issuer (as from time to time amended) included an untrue statement of a material fact or omitted to state a material fact required to be stated or necessary in order to make the statements not misleading, insofar as the statement or omission was made in reliance upon, and in conformity with information furnished to the Issuer by or on behalf of Distributors. In no case (i) is the indemnity of Distributors in favor of the Issuer or any person indemnified to be deemed to protect the Issuer or any person against any liability to which the Issuer or such person would otherwise be subject by reason of willful misfeasance, bad faith or gross negligence in the performance of its duties or by reason of its reckless disregard of its obligations and duties under this Agreement, or (ii) is Distributors to be liable under its indemnity agreement contained in this paragraph with respect to any claim made against the Issuer or any person indemnified unless the Issuer or person, as the case may be, shall have notified Distributors in writing of the claim within a reasonable time after the summons or other first written notification giving information of the nature of the claim shall have been served upon the Issuer or any such person (or after the Issuer or such person shall have received notice of service on any designated agent). However, failure to notify Distributors of any claim shall not relieve Distributors from any liability which it may have to the Issuer or any person against whom the action is brought otherwise than on account of its indemnity agreement contained in this paragraph. In the case of any notice to Distributors, it shall be entitled to participate, at its own expense, in the defense or, if it so elects, to assume the defense of any suit brought to enforce the claim, but if Distributors elects to assume the defense, the defense shall be conducted by counsel chosen by it and satisfactory to the Issuer, to its officers and Board and to any controlling person or persons, defendant or defendants in the suit. In the event that Distributors elects to assume the defense of any suit and retain counsel, the Issuer or controlling persons, defendant or defendants in the suit, shall bear the fees and expense of any additional counsel retained by them. If Distributors does not elect to assume the defense of any suit, it will reimburse the Issuer, officers and Board or controlling person or persons, defendant or defendants in the suit, for the reasonable fees and expenses of any counsel retained by them. Distributors agrees to notify the Issuer promptly of the commencement of any litigation or proceedings against it in connection with the issue and sale of any of the shares. 12. Effective Date - This agreement shall be effective upon its execution, and unless terminated as provided, shall continue in force until March 31, 199 and thereafter from year to year, provided continuance is approved annually by the vote of a majority of the Board members of the Issuer, and by the vote of those Board members of the Issuer who are not "interested persons" of the Issuer and, if a plan under Rule 12b-1 under the Investment Company Act of 1940 is in effect, by the vote of those Board members of the Issuer who are not "interested persons" of the Issuer and who are not parties to the Distribution and Service Plan or this Agreement and have no financial interest in the operation of the Distribution and Service Plan or in any agreements related to the Distribution and Service Plan, cast in person at a meeting called for the purpose of voting on the approval. This Agreement shall automatically terminate in the event of its assignment. As used in this paragraph, the terms "assignment" and "interested persons" shall have the respective meanings specified in the Investment Company Act of 1940 as now in effect or as hereafter amended. In addition to termination by failure to approve continuance or by assignment, this Agreement may at any time be terminated by either party upon not less than sixty days' prior written notice to the other party. 13. Notice - Any notice required or permitted to be given by either party to the other shall be deemed sufficient if sent by registered or certified mail, postage prepaid, addressed by the party giving notice to the other party at the last address furnished by the other party to the party giving notice: if to the Issuer, at 82 Devonshire Street, Boston, Massachusetts, and if to Distributors, at 82 Devonshire Street, Boston, Massachusetts. 14. Limitation of Liability - Distributors is expressly put on notice of the limitation of shareholder liability as set forth in the Declaration of Trust or other organizational document of the Issuer and agrees that the obligations assumed by the Issuer under this contract shall be limited in all cases to the Issuer and its assets. Distributors shall not seek satisfaction of any such obligation from the shareholders or any shareholder of the Issuer. Nor shall Distributors seek satisfaction of any such obligation from the Trustees or any individual Trustee of the Issuer. Distributors understands that the rights and obligations of each series of shares of the Issuer under the Issuer's Declaration of Trust or other organizational document are separate and distinct from those of any and all other series. 15. This agreement shall be governed by, and construed in accordance with, the laws of the Commonwealth of Massachusetts, without giving effect to the choice of laws provisions thereof. IN WITNESS WHEREOF, the Issuer has executed this instrument in its name and behalf, and its seal affixed, by one of its officers duly authorized, and Distributors has executed this instrument in its name and behalf by one of its officers duly authorized, as of the day and year first above written. [SIGNATURE LINES OMITTED] EX-99.B6 10 Exhibit 6(h) FORM OF BANK AGENCY AGREEMENT We at Fidelity Distributors Corporation offer to make available to your customers shares of the mutual funds, or the separate series or classes of the mutual funds, listed on Schedules A and B attached to this Agreement (the "Portfolios"). We may periodically change the list of Portfolios by giving you written notice of the change. We are the Portfolios' principal underwriter and act as agent for the Portfolios. You (____________________________________) are a division or affiliate of a bank (____________________________________) and desire to make Portfolio shares available to your customers on the following terms: 1. Certain Defined Terms: As used in this Agreement, the term "Prospectus" means the applicable Portfolio's prospectus and related statement of additional information, whether in paper format or electronic format, included in the Portfolio's then currently effective registration statement (or post-effective amendment thereto), and any information that we or the Portfolio may issue to you as a supplement to such prospectus or statement of additional information (a "sticker"), all as filed with the Securities and Exchange Commission (the "SEC") pursuant to the Securities Act of 1933. 2. Making Portfolio Shares Available to Your Customers: (a) In all transactions covered by this Agreement: (i) you will act as agent for your customers; in no transaction are you authorized to act as agent for us or for any Portfolio; (ii) you will initiate transactions only upon your customers' orders; (iii) we will execute transactions only upon receiving instructions from you acting as agent for your customers; and (iv) each transaction will be for your customer's account and not for your own account. Each transaction will be without recourse to you, provided that you act in accordance with the terms of this Agreement. (b) You agree to make Portfolio shares available to your customers only at the applicable public offering price in accordance with the Prospectus. If your customer qualifies for a reduced sales charge pursuant to a special purchase plan (for example, a quantity discount, letter of intent, or right of accumulation) as described in the Prospectus, you agree to make Portfolio shares available to your customer at the applicable reduced sales charge. You agree to deliver or cause to be delivered to each customer, at or prior to the time of any purchase of shares, a copy of the then current prospectus (including any stickers thereto), unless such prospectus has already been delivered to the customer, and to each customer who so requests, a copy of the then current statement of additional information (including any stickers thereto). (c) You agree to order Portfolio shares from us only to cover purchase orders that you have already received from your customers, or for your own investment. You will not withhold placing customers' orders so as to profit yourself as a result of such withholding (for example, by a change in a Portfolio's net asset value from that used in determining the offering price to your customers). (d) We will accept your purchase orders only at the public offering price applicable to each order, as determined in accordance with the Prospectus. We will not accept from you a conditional order for Portfolio shares. All orders are subject to acceptance or rejection by us in our sole discretion. We may, without notice, suspend sales or withdraw the offering of Portfolio shares, or make a limited offering of Portfolio shares. (e) The placing of orders with us will be governed by instructions that we will periodically issue to you. You must pay for Portfolio shares in New York or Boston clearing house funds or in federal funds in accordance with such instructions, and we must receive your payment on or before the settlement date established in accordance with Rule 15c6-1 under the Securities Exchange Act of 1934 (the "1934 Act"). (f) You agree to comply with all applicable state and federal laws and with the rules and regulations of authorized regulatory agencies thereunder. You agree to make Portfolio shares available to your customers only in states where you may legally make such Portfolio's shares available. You will not make available shares of any Portfolio unless such shares are registered under the applicable state and federal laws and the rules and regulations thereunder. (g) Certificates evidencing Portfolio shares are not available; any transaction in Portfolio shares will be effected and evidenced by book-entry on the records maintained by Fidelity Investments Institutional Operations Company, Inc. ("FIIOC"). A confirmation statement evidencing transactions in Portfolio shares will be transmitted to you. (h) You may designate FIIOC to execute your customers' transactions in Portfolio shares in accordance with the terms of any account, program, plan, or service established or used by your customers, and to confirm each transaction to your customers on your behalf on a fully disclosed basis. At the time of the transaction, you guarantee the legal capacity of your customers and any co-owners of such shares so transacting in such shares. 3. Your Compensation: (a) Your fee, if any, for acting as agent with respect to sales of Portfolio shares will be as provided in the Prospectus or in the applicable schedule of agency fees issued by us and in effect at the time of the sale. Upon written notice to you, we or any Portfolio may change or discontinue any schedule of agency fees, or issue a new schedule. (b) If a Portfolio has adopted a plan pursuant to Rule 12b-1 under the Investment Company Act of 1940 (a "Plan"), we may make distribution payments or service payments to you under the Plan. If a Portfolio does not have a currently effective Plan, we or Fidelity Management & Research Company may make distribution payments or service payments to you from our own funds. Any distribution payments or service payments will be made in the amount and manner set forth in the Prospectus or in the applicable schedule of distribution payments or service payments issued by us and then in effect. Upon written notice to you, we or any Portfolio may change or discontinue any schedule of distribution payments or service payments, or issue a new schedule. A schedule of distribution payments or service payments will be in effect with respect to a Portfolio that has a Plan only so long as that Portfolio's Plan remains in effect. (c) After the effective date of any change in or discontinuance of any schedule of agency fees, distribution payments, or service payments, or the termination of a Plan, any agency fees, distribution payments, or service payments will be allowable or payable to you only in accordance with such change, discontinuance, or termination. You agree that you will have no claim against us or any Portfolio by virtue of any such change, discontinuance, or termination. In the event of any overpayment by us of any agency fee, distribution payment, or service payment, you will remit such overpayment. (d) If, within seven (7) business days after our confirmation of the original purchase order for shares of a Portfolio, such shares are redeemed by the issuing Portfolio or tendered for redemption by the customer, you agree (i) to refund promptly to us the full amount of any agency fee, distribution payment, or service payment paid to you on such shares, and (ii) if not yet paid to you, to forfeit the right to receive any agency fee, distribution payment, or service payment payable to you on such shares. We will notify you of any such redemption within ten (10) days after the date of the redemption. 4. Certain Types of Accounts: (a) You may instruct FIIOC to register purchased shares in your name and account as nominee for your customers. If you hold Portfolio shares as nominee for your customers, all Prospectuses, proxy statements, periodic reports, and other printed material will be sent to you, and all confirmations and other communications to shareholders will be transmitted to you. You will be responsible for forwarding such printed material, confirmations, and communications, or the information contained therein, to all customers for whose account you hold any Portfolio shares as nominee. However, we or FIIOC on behalf of itself or the Portfolios will be responsible for the costs associated with your forwarding such printed material, confirmations, and communications. You will be responsible for complying with all reporting and tax withholding requirements with respect to the customers for whose account you hold any Portfolio shares as nominee. (b) With respect to accounts other than those accounts referred to in paragraph 4(a) above, you agree to provide us with all information (including certification of taxpayer identification numbers and back-up withholding instructions) necessary or appropriate for us to comply with legal and regulatory reporting requirements. (c) Accounts opened or maintained pursuant to the NETWORKING system of the National Securities Clearing Corporation ("NSCC") will be governed by applicable NSCC rules and procedures and any agreement or other arrangement with us relating to NETWORKING. (d) If you hold Portfolio shares in an omnibus account for two or more customers, you will be responsible for determining, in accordance with the Prospectus, whether, and the extent to which, a CDSC is applicable to a purchase of Portfolio shares from such a customer, and you agree to transmit immediately to us any CDSC to which such purchase was subject. You hereby represent that if you hold Portfolio shares subject to a CDSC, you have the capability to track and account for such charge, and we reserve the right, at our discretion, to verify that capability by inspecting your tracking and accounting system or otherwise. 5. Status as Registered Broker/Dealer or "Bank": (a) Each party to this Agreement represents to the other party that it is either (i) a registered broker/dealer under the 1934 Act, or (ii) a "bank" as defined in Section 3(a)(6) of the 1934 Act. (b) If a party is a registered broker/dealer, such party represents that it is qualified to act as a broker/dealer in the states where it transacts business, and it is a member in good standing of the National Association of Securities Dealers, Inc. ("NASD"). It agrees to maintain its broker/dealer registration and qualifications and its NASD membership in good standing throughout the term of this Agreement. It agrees to abide by all of the NASD's rules and regulations, including the NASD's Conduct Rules -- in particular, Section 2830 of such Rules, which section is deemed a part of and is incorporated by reference in this Agreement. This Agreement will terminate automatically without notice in the event that a party's NASD membership is terminated. (c) If you are a "bank", you represent that you are duly authorized to engage in the transactions to be performed under this Agreement, and you agree to comply with all applicable federal and state laws, including the rules and regulations of all applicable federal and state bank regulatory agencies and authorities. This Agreement will terminate automatically without notice in the event that you cease to be a "bank" as defined in Section 3(a)(6) of the 1934 Act. (d) Nothing in this Agreement shall cause you to be our partner, employee, or agent, or give you any authority to act for us or for any Portfolio. Neither we nor any Portfolio shall be liable for any of your acts or obligations as a dealer under this Agreement. 6. Information Relating to the Portfolios: (a) No person is authorized to make any representations concerning shares of a Portfolio other than those contained in the Portfolio's Prospectus. In ordering Portfolio shares from us under this Agreement, you will rely only on the representations contained in the Prospectus. Upon your request, we will furnish you with a reasonable number of copies of the Portfolios' current prospectuses or statements of additional information or both (including any stickers thereto). (b) Any printed or electronic information that we furnish you (other than the Portfolios' Prospectuses and periodic reports) is our sole responsibility and not the responsibility of the respective Portfolios. You agree that the Portfolios will have no liability or responsibility to you with respect to any such printed or electronic information. We or the respective Portfolio will bear the expense of qualifying its shares under the state securities laws. (c) You may not use any sales literature or advertising material (including material disseminated through radio, television, or other electronic media) concerning Portfolio shares, other than the printed or electronic information referred to in paragraph 6(b) above, in connection with making Portfolio shares available to your customers without obtaining our prior written approval. You may not distribute or make available to investors any information that we furnish you marked "FOR DEALER USE ONLY" or that otherwise indicates that it is confidential or not intended to be distributed to investors. 7. Indemnification: (a) We will indemnify and hold you harmless from any claim, demand, loss, expense, or cause of action resulting from the misconduct or negligence, as measured by industry standards, of us, our agents and employees, in carrying out our obligations under this Agreement. Such indemnification will survive the termination of this Agreement. (b) You will indemnify and hold us harmless from any claim, demand, loss, expense, or cause of action resulting from the misconduct or negligence, as measured by industry standards, of you, your agents and employees, in carrying out your obligations under this Agreement. Such indemnification will survive the termination of this Agreement. 8. Customer Lists: We hereby agree that we shall not use any list of your customers which may be obtained in connection with this Agreement for the purpose of solicitation of any product or service without your express written consent. However, nothing in this paragraph or otherwise shall be deemed to prohibit or restrict us or our affiliates in any way from solicitations of any product or service directed at, without limitation, the general public, any segment thereof, or any specific individual, provided such solicitation is not based upon such list. 9. Duration of Agreement: This Agreement, with respect to any Plan, will continue in effect for one year from its effective date, and thereafter will continue automatically for successive annual periods; provided, however, that such continuance is subject to termination at any time without penalty if a majority of a Portfolio's Trustees who are not interested persons of the Portfolio (as defined in the Investment Company Act of 1940 (the "1940 Act")), or a majority of the outstanding shares of the Portfolio, vote to terminate or not to continue the Plan. This Agreement, other than with respect to a Plan, will continue in effect from year to year after its effective date, unless terminated as provided herein. 10. Amendment and Termination of Agreement: (a) We may amend any provision of this Agreement by giving you written notice of the amendment. Either party to this Agreement may terminate the Agreement without cause by giving the other party at least thirty (30) days' written notice of its intention to terminate. This Agreement will terminate automatically in the event of its assignment (as defined in the 1940 Act). (b) In the event that (i) an application for a protective decree under the provisions of the Securities Investor Protection Act of 1970 is file against you; (ii) you file a petition in bankruptcy or a petition seeking similar relief under any bankruptcy, insolvency, or similar law, or a proceeding is commenced against you seeking such relief; or (iii) you are found by the SEC, the NASD, or any other federal or state regulatory agency or authority to have violated any applicable federal or state law, rule or regulation arising out of your activities as a broker/dealer or in connection with this Agreement, this Agreement will terminate effective immediately upon our giving notice of termination to you. You agree to notify us promptly and to immediately suspend making Portfolio shares available to your customers in the event of any such filing or violation, or in the event that you cease to be a member in good standing of the NASD or you cease to be a "bank" as defined in Section 3(a)(6) of the 1934 Act. (c) Your or our failure to terminate this Agreement for a particular cause will not constitute a waiver of the right to terminate this Agreement at a later date for the same or another cause. The termination of this Agreement with respect to any one Portfolio will not cause its termination with respect to any other Portfolio. 11. Arbitration: In the event of a dispute, such dispute will be settled by arbitration before arbitrators sitting in Boston, Massachusetts in accordance with the NASD's Code of Arbitration Procedure in effect at the time of the dispute. The arbitrators will act by majority decision and their award may allocate attorneys' fees and arbitration costs between us. Their award will be final and binding between us, and such award may be entered as a judgment in any court of competent jurisdiction. 12. Notices: All notices required or permitted to be given under this Agreement shall be given in writing and delivered by personal delivery, by postage prepaid mail, or by facsimile machine or a similar means of same day delivery (with a confirming copy by mail). All notices to us shall be given or sent to us at our offices located at 82 Devonshire Street, Mail Zone L12A, Boston, Massachusetts 02109, Attn: Bank Wholesale Market. All notices to you shall be given or sent to you at the address specified by you below. Each of us may change the address to which notices shall be sent by giving notice to the other party in accordance with this paragraph 12. 13. Miscellaneous: This Agreement, as it may be amended from time to time, shall become effective as of the date when it is accepted and dated below by us. This Agreement is to be construed in accordance with the laws of the Commonwealth of Massachusetts. This Agreement supersedes and cancels any prior agreement between us, whether oral or written, relating to the sale of shares of the Portfolios or any other subject covered by this Agreement. The captions in this Agreement are included for convenience of reference only and in no way define or limit any of the provisions of this Agreement or otherwise affect their construction or effect. Very truly yours, FIDELITY DISTRIBUTORS CORPORATION Please return two signed copies of this Agreement to Fidelity Distributors Corporation. Upon acceptance, one countersigned copy will be returned to you for your files. _____________________________________ Name of Firm Address: _____________________________ _____________________________________ _____________________________________ By __________________________________ Authorized Representative _____________________________________ Name and Title (please print or type) ACCEPTED AND AGREED: FIDELITY DISTRIBUTORS CORPORATION By __________________________________ Dated: ________________ EX-99.B6 11 Exhibit 6(i) FORM OF SELLING DEALER AGREEMENT We at Fidelity Distributors Corporation invite you (______________________________) to distribute shares of the mutual funds, or the separate series or classes of the mutual funds, listed on Schedule A attached to this Agreement (the "Portfolios"). We may periodically change the list of Portfolios by giving you written notice of the change. We are the Portfolios' principal underwriter and, as agent for the Portfolios, we offer to sell Portfolio shares to you on the following terms: 1. Certain Defined Terms: As used in this Agreement, the term "Prospectus" means the applicable Portfolio's prospectus and related statement of additional information, whether in paper format or electronic format, included in the Portfolio's then currently effective registration statement (or post-effective amendment thereto), and any information that we or the Portfolio may issue to you as a supplement to such prospectus or statement of additional information (a "sticker"), all as filed with the Securities and Exchange Commission (the "SEC") pursuant to the Securities Act of 1933. 2. Purchases of Portfolio Shares for Sale to Customers: (a) In offering and selling Portfolio shares to your customers, you agree to act as dealer for your own account; you are not authorized to act as agent for us or for any Portfolio. (b) You agree to offer and sell Portfolio shares to your customers only at the applicable public offering price in accordance with the Prospectus. If your customer qualifies for a reduced sales charge pursuant to a special purchase plan (for example, a quantity discount, letter of intent, or right of accumulation) as described in the Prospectus, you agree to offer and sell Portfolio shares to your customer at the applicable reduced sales charge. You agree to deliver or cause to be delivered to each customer, at or prior to the time of any purchase of shares, a copy of the then current prospectus (including any stickers thereto), unless such prospectus has already been delivered to the customer, and to each customer who so requests, a copy of the then current statement of additional information (including any stickers thereto). (c) You agree to purchase Portfolio shares from us only to cover purchase orders that you have already received from your customers, or for your own investment. You also agree not to purchase any Portfolio shares from your customers at a price lower than the applicable redemption price, determined in the manner described in the Prospectus. You will not withhold placing customers' orders so as to profit yourself as a result of such withholding (for example, by a change in a Portfolio's net asset value from that used in determining the offering price to your customers). (d) We will accept your purchase orders only at the public offering price applicable to each order, as determined in accordance with the Prospectus. We will not accept from you a conditional order for Portfolio shares. All orders are subject to acceptance or rejection by us in our sole discretion. We may, without notice, suspend sales or withdraw the offering of Portfolio shares, or make a limited offering of Portfolio shares. (e) The placing of orders with us will be governed by instructions that we will periodically issue to you. You must pay for Portfolio shares in New York or Boston clearing house funds or in federal funds in accordance with such instructions, and we must receive your payment on or before the settlement date established in accordance with Rule 15c6-1 under the Securities Exchange Act of 1934 (the "1934 Act"). If we do not receive your payment on or before such settlement date, we may, without notice, cancel the sale, or, at our option, sell the shares that you ordered back to the issuing Portfolio, and we may hold you responsible for any loss suffered by us or the issuing Portfolio as a result of your failure to make payment as required. (f) You agree to comply with all applicable state and federal laws and with the rules and regulations of authorized regulatory agencies thereunder. You agree to offer and sell Portfolio shares only in states where you may legally offer and sell such Portfolio's shares. You will not offer shares of any Portfolio for sale unless such shares are registered for sale under the applicable state and federal laws and the rules and regulations thereunder. (g) Certificates evidencing Portfolio shares are not available; any transaction in Portfolio shares will be effected and evidenced by book-entry on the records maintained by Fidelity Investments Institutional Operations Company, Inc. ("FIIOC"). A confirmation statement evidencing transactions in Portfolio shares will be transmitted to you. (h) You may designate FIIOC to execute your customers' transactions in Portfolio shares in accordance with the terms of any account, program, plan, or service established or used by your customers, and to confirm each transaction to your customers on your behalf. At the time of the transaction, you guarantee the legal capacity of your customers and any co-owners of such shares so transacting in such shares. 3. Your Compensation: (a) Your concession, if any, on your sales of Portfolio shares will be as provided in the Prospectus or in the applicable schedule of concessions issued by us and in effect at the time of our sale to you. Upon written notice to you, we or any Portfolio may change or discontinue any schedule of concessions, or issue a new schedule. (b) If a Portfolio has adopted a plan pursuant to Rule 12b-1 under the Investment Company Act of 1940 (a "Plan"), we may make distribution payments or service payments to you under the Plan. If a Portfolio does not have a currently effective Plan, we or Fidelity Management & Research Company may make distribution payments or service payments to you from our own funds. Any distribution payments or service payments will be made in the amount and manner set forth in the Prospectus or in the applicable schedule of distribution payments or service payments issued by us and then in effect. Upon written notice to you, we or any Portfolio may change or discontinue any schedule of distribution payments or service payments, or issue a new schedule. A schedule of distribution payments or service payments will be in effect with respect to a Portfolio that has a Plan only so long as that Portfolio's Plan remains in effect. (c) After the effective date of any change in or discontinuance of any schedule of concessions, distribution payments, or service payments, or the termination of a Plan, any concessions, distribution payments, or service payments will be allowable or payable to you only in accordance with such change, discontinuance, or termination. You agree that you will have no claim against us or any Portfolio by virtue of any such change, discontinuance, or termination. In the event of any overpayment by us of any concession, distribution payment, or service payment, you will remit such overpayment. (d) If any Portfolio shares sold to you by us under the terms of this Agreement are redeemed by the issuing Portfolio or tendered for redemption by the customer within seven (7) business days after the date of our confirmation of your original purchase order for such shares, you agree (i) to refund promptly to us the full amount of any concession, distribution payment, or service payment allowed or paid to you on such shares, and (ii) if not yet allowed or paid to you, to forfeit the right to receive any concession, distribution payment, or service payment allowable or payable to you on such shares. We will notify you of any such redemption within ten (10) days after the date of the redemption. 4. Certain Types of Accounts: (a) You may instruct FIIOC to register purchased shares in your name and account as nominee for your customers. If you hold Portfolio shares as nominee for your customers, all Prospectuses, proxy statements, periodic reports, and other printed material will be sent to you, and all confirmations and other communications to shareholders will be transmitted to you. You will be responsible for forwarding such printed material, confirmations, and communications, or the information contained therein, to all customers for whose account you hold any Portfolio shares as nominee. However, we or FIIOC on behalf of itself or the Portfolios will be responsible for the costs associated with your forwarding such printed material, confirmations, and communications. You will be responsible for complying with all reporting and tax withholding requirements with respect to the customers for whose account you hold any Portfolio shares as nominee. (b) With respect to accounts other than those accounts referred to in paragraph 4(a) above, you agree to provide us with all information (including certification of taxpayer identification numbers and back-up withholding instructions) necessary or appropriate for us to comply with legal and regulatory reporting requirements. (c) Accounts opened or maintained pursuant to the NETWORKING system of the National Securities Clearing Corporation ("NSCC") will be governed by applicable NSCC rules and procedures and any agreement or other arrangement with us relating to NETWORKING. (d) If you hold Portfolio shares in an omnibus account for two or more customers, you will be responsible for determining, in accordance with the Prospectus, whether, and the extent to which, a CDSC is applicable to a purchase of Portfolio shares from such a customer, and you agree to transmit immediately to us any CDSC to which such purchase was subject. You hereby represent that if you hold Portfolio shares subject to a CDSC, you have the capability to track and account for such charge, and we reserve the right, at our discretion, to verify that capability by inspecting your tracking and accounting system or otherwise. 5. Status as Registered Broker/Dealer: (a) Each party to this Agreement represents to the other party that (i) it is registered as a broker/dealer under the 1934 Act, (ii) it is qualified to act as a broker/dealer in the states where it transacts business, and (iii) it is a member in good standing of the National Association of Securities Dealers, Inc. ("NASD"). Each party agrees to maintain its broker/dealer registration and qualifications and its NASD membership in good standing throughout the term of this Agreement. Each party agrees to abide by all of the NASD's rules and regulations, including the NASD's Conduct Rules -- in particular, Section 2830 of such Rules, which section is deemed a part of and is incorporated by reference in this Agreement. This Agreement will terminate automatically without notice in the event that either party's NASD membership is terminated. (b) Nothing in this Agreement shall cause you to be our partner, employee, or agent, or give you any authority to act for us or for any Portfolio. Neither we nor any Portfolio shall be liable for any of your acts or obligations as a dealer under this Agreement. 6. Information Relating to the Portfolios: (a) No person is authorized to make any representations concerning shares of a Portfolio other than those contained in the Portfolio's Prospectus. In buying Portfolio shares from us under this Agreement, you will rely only on the representations contained in the Prospectus. Upon your request, we will furnish you with a reasonable number of copies of the Portfolios' current prospectuses or statements of additional information or both (including any stickers thereto). (b) Any printed or electronic information that we furnish you (other than the Portfolios' Prospectuses and periodic reports) is our sole responsibility and not the responsibility of the respective Portfolios. You agree that the Portfolios will have no liability or responsibility to you with respect to any such printed or electronic information. We or the respective Portfolio will bear the expense of qualifying its shares under the state securities laws. (c) You may not use any sales literature or advertising material (including material disseminated through radio, television, or other electronic media) concerning Portfolio shares, other than the printed or electronic information referred to in paragraph 6(b) above, in connection with the offer or sale of Portfolio shares without obtaining our prior written approval. You may not distribute or make available to investors any information that we furnish you marked "FOR DEALER USE ONLY" or that otherwise indicates that it is confidential or not intended to be distributed to investors. 7. Indemnification: (a) We will indemnify and hold you harmless from any claim, demand, loss, expense, or cause of action resulting from the misconduct or negligence, as measured by industry standards, of us, our agents and employees, in carrying out our obligations under this Agreement. Such indemnification will survive the termination of this Agreement. (b) You will indemnify and hold us harmless from any claim, demand, loss, expense, or cause of action resulting from the misconduct or negligence, as measured by industry standards, of you, your agents and employees, in carrying out your obligations under this Agreement. Such indemnification will survive the termination of this Agreement. 8. Customer Lists: We hereby agree that we shall not use any list of your customers which may be obtained in connection with this Agreement for the purpose of solicitation of any product or service without your express written consent. However, nothing in this paragraph or otherwise shall be deemed to prohibit or restrict us or our affiliates in any way from solicitations of any product or service directed at, without limitation, the general public, any segment thereof, or any specific individual, provided such solicitation is not based upon such list. 9. Duration of Agreement: This Agreement, with respect to any Plan, will continue in effect for one year from its effective date, and thereafter will continue automatically for successive annual periods; provided, however, that such continuance is subject to termination at any time without penalty if a majority of a Portfolio's Trustees who are not interested persons of the Portfolio (as defined in the Investment Company Act of 1940 (the "1940 Act")), or a majority of the outstanding shares of the Portfolio, vote to terminate or not to continue the Plan. This Agreement, other than with respect to a Plan, will continue in effect from year to year after its effective date, unless terminated as provided herein. 10. Amendment and Termination of Agreement: (a) We may amend any provision of this Agreement by giving you written notice of the amendment. Either party to this Agreement may terminate the Agreement without cause by giving the other party at least thirty (30) days' written notice of its intention to terminate. This Agreement will terminate automatically in the event of its assignment (as defined in the 1940 Act). (b) In the event that (i) an application for a protective decree under the provisions of the Securities Investor Protection Act of 1970 is filed against you; (ii) you file a petition in bankruptcy or a petition seeking similar relief under any bankruptcy, insolvency, or similar law, or a proceeding is commenced against you seeking such relief; or (iii) you are found by the SEC, the NASD, or any other federal or state regulatory agency or authority to have violated any applicable federal or state law, rule or regulation arising out of your activities as a broker/dealer or in connection with this Agreement, this Agreement will terminate effective immediately upon our giving notice of termination to you. You agree to notify us promptly and to immediately suspend sales of Portfolio shares in the event of any such filing or violation, or in the event that you cease to be a member in good standing of the NASD. (c) Your or our failure to terminate this Agreement for a particular cause will not constitute a waiver of the right to terminate this Agreement at a later date for the same or another cause. The termination of this Agreement with respect to any one Portfolio will not cause its termination with respect to any other Portfolio. 11. Arbitration: In the event of a dispute, such dispute will be settled by arbitration before arbitrators sitting in Boston, Massachusetts in accordance with the NASD's Code of Arbitration Procedure in effect at the time of the dispute. The arbitrators will act by majority decision and their award may allocate attorneys' fees and arbitration costs between us. Their award will be final and binding between us, and such award may be entered as a judgment in any court of competent jurisdiction. 12. Notices: All notices required or permitted to be given under this Agreement shall be given in writing and delivered by personal delivery, by postage prepaid mail, or by facsimile machine or a similar means of same day delivery (with a confirming copy by mail). All notices to us shall be given or sent to us at our offices located at 82 Devonshire Street, Mail Zone L10A, Boston, Massachusetts 02109, Attn: Broker Dealer Services Group. All notices to you shall be given or sent to you at the address specified by you below. Each of us may change the address to which notices shall be sent by giving notice to the other party in accordance with this paragraph 12. 13. Miscellaneous: This Agreement, as it may be amended from time to time, shall become effective as of the date when it is accepted and dated below by us. This Agreement is to be construed in accordance with the laws of the Commonwealth of Massachusetts. This Agreement supersedes and cancels any prior agreement between us, whether oral or written, relating to the sale of shares of the Portfolios or any other subject covered by this Agreement. The captions in this Agreement are included for convenience of reference only and in no way define or limit any of the provisions of this Agreement or otherwise affect their construction or effect. Very truly yours, FIDELITY DISTRIBUTORS CORPORATION Please return two signed copies of this Agreement to Fidelity Distributors Corporation. Upon acceptance, one countersigned copy will be returned to you for your files. _____________________________________ Name of Firm Address: _____________________________ _____________________________________ _____________________________________ By __________________________________ Authorized Representative _____________________________________ Name and Title (please print or type) CRD # _______________________________ ACCEPTED AND AGREED: FIDELITY DISTRIBUTORS CORPORATION By __________________________________ Dated: _________________ EX-99.B8 12 Exhibit 8(m) Form of FIDELITY GROUP REPO CUSTODIAN AGREEMENT FOR JOINT TRADING ACCOUNT AGREEMENT dated as of ______, among THE BANK OF NEW YORK, a banking corporation organized under the laws of the State of New York ("Repo Custodian"), J.P. MORGAN SECURITIES INC. ("Seller") and each of the entities listed on Schedule A-1, A-2, A-3 and A-4 (collectively, the "Funds" and each a "Fund") hereto, acting on behalf of itself or (i) in the case of the Funds listed on Schedule A-1 or A-2 hereto which are portfolios or series, acting through the series company listed on Schedule A-1 or A-2 hereto, (ii) in the case of the accounts listed on Schedule A-3 hereto, acting through Fidelity Management & Research Company, and (iii) in the case of the commingled or individual accounts listed on Schedule A-4 hereto, acting through Fidelity Management Trust Company (collectively, the "Funds" and each, a "Fund"). WITNESSETH WHEREAS, each of the Funds has entered into a master repurchase agreement dated as of ___________, (the "Master Agreement") with Seller pursuant to which from time to time one or more of the Funds, as buyers, and Seller, as seller, may enter into repurchase transactions effected through one or more joint trading accounts (collectively, the "Joint Trading Account") established and administered by one or more custodians of the Funds identified on Schedule C hereto (each a "Custodian"); and, WHEREAS, in each such repurchase transaction Seller will sell to such Funds certain Securities (as hereinafter defined) selected from Eligible Securities (as hereinafter defined) held by Repo Custodian, subject to an agreement by Seller to repurchase such Securities; and WHEREAS, Repo Custodian currently maintains a cash and securities account (the "Seller Account") for Seller for the purpose of, among other things, effecting repurchase transactions hereunder; and WHEREAS, the Funds desire that the Repo Custodian serve as the custodian for the Funds in connection with the repurchase transactions effected hereunder, and that the Repo Custodian hold cash, Cash Collateral (as hereinafter defined) and Securities for the Funds for the purpose of effecting repurchase transactions hereunder. NOW THEREFORE, the parties hereto hereby agree as follows: 1. Definitions. Whenever used in this Agreement, the following terms shall have the meanings set forth below: (a) "Banking Day" shall mean any day on which the Funds, Seller Custodian, Repo Custodian, and the Federal Reserve Banks where the Custodian and the Repo Custodian are located, are each open for business. (b) "Cash Collateral" shall mean all cash, denominated in U.S. Dollars, credited by Repo Custodian to a Transaction Account pursuant to Paragraphs 3, 6, 8 or 9 of the Master Agreement. (c) "Custodian" shall have the meaning set forth in the preamble of this Agreement. (d) "Eligible Securities" shall mean those securities which are identified as permissible securities for a particular Transaction Category. (e) "FICASH I Transaction" and "FICASH III Transaction " shall mean a repurchase transaction in which the Repurchase Date is the Banking Day next following the Sale Date and for which securities issued by the government of the United States of America that are direct obligations of the government of the United States of America shall constitute Eligible Securities. (f) "FICASH II Transaction" shall mean a repurchase transaction in which the Repurchase Date is the Banking Day next following the Sale Date and for which one or more of the following two categories of securities, as specified by the Funds, shall constitute Eligible Securities: (x) securities issued by the government of the United States of America that are direct obligations of the government of the United States of America, or (y) securities issued by or guaranteed as to principal and interest by the government of the United States of America, or by its agencies and/or instrumentalities, including, but not limited to, the Federal Home Loan Bank, Federal Home Loan Mortgage Corp., Government National Mortgage Association, Federal National Mortgage Association, Federal Farm Credit Bank, Federal Intermediate Credit Bank, Banks for Cooperatives, and Federal Land Banks. (g) "FITERM I Transaction" and "FITERM III Transaction" shall mean a repurchase transaction in which the Repurchase Date is a date fixed by agreement between Seller and the Participating Funds which is not the Banking Day next following the Sale Date and for which securities issued by the government of the United States of America that are direct obligations of the government of the United States of America shall constitute Eligible Securities. (h) "FITERM II Transaction" shall mean a repurchase transaction in which the Repurchase Date is a date fixed by agreement between Seller and the Participating Funds which is not the Banking Day next following the Sale Date and for which one or more of the following two categories of securities, as specified by the Funds, shall constitute Eligible Securities: (x) securities issued by the government of the United States of America that are direct obligations of the government of the United States of America, or (y) securities issued by or guaranteed as to principal and interest by the government of the United States of America, or by its agencies and/or instrumentalities, including, but not limited to, the Federal Home Loan Bank, Federal Home Loan Mortgage Corp., Government National Mortgage Association, Federal National Mortgage Association, Federal Farm Credit Bank, Federal Intermediate Credit Bank, Banks for Cooperatives, and Federal Land Banks. (i) "Fund" shall have the meaning set forth in the preamble of this Agreement. (j) "Fund Agent" shall mean the agent for the Participating Funds designated in Paragraph 18 of the Master Agreement. (k) "Joint Trading Account" shall have the meaning set forth in the preamble of this Agreement. (l) "Margin Percentage" with respect to any repurchase transaction shall be 102% or such other percentage as is agreed to by Seller and the Participating Funds (except that in no event shall the Margin Percentage be less than 100%). (m) "Market Value" shall have the meaning set forth in Paragraph 4 of the Master Agreement. (n) "Master Agreement" shall have the meaning set forth in the preamble of this Agreement. (o) "1940 Act" shall mean have the meaning set forth in Paragraph 3(c) of this Agreement. (p) "Partial Payment" shall have the meaning set forth in Section 4(g) of this Agreement. (q) "Participating Funds" shall mean those Funds that are parties to a particular repurchase transaction effected through the Joint Trading Account. (r) "Pricing Rate" shall mean the per annum percentage rate agreed to by Seller and the Participating Funds for a repurchase transaction. (s) "Pricing Services" shall have the meaning set forth in Paragraph 7 of this Agreement. (t) "Repo Custodian" shall have the meaning set forth in the preamble of this Agreement. (u) "Repurchase Date" shall mean the date fixed by agreement between Seller and the Participating Funds on which the Seller is to repurchase Securities and Cash Collateral, if any, from the Participating Funds and the Participating Funds are to resell the Securities and Cash Collateral, if any, including any date determined by application of the provisions of Paragraphs 7 and 15 of the Master Agreement. (v) "Repurchase Price" for each repurchase transaction shall mean the Sale Price, plus an incremental amount determined by applying the Pricing Rate to the Sale Price, calculated on the basis of a 360-day year and the number of actual days elapsed from (and including) the Sale Date to (but excluding) the Repurchase Date. (w) "Sale Date" shall mean the Banking Day on which Securities and Cash Collateral, if any, are to be sold to the Participating Funds by Seller pursuant to a repurchase transaction hereunder. (x) "Sale Price" shall mean the price agreed upon by the Participating Funds and Seller at which the Securities and Cash Collateral, if any, are to be sold to the Participating Funds by Seller. (y) "Securities" shall mean all Eligible Securities delivered by Seller or to be delivered by Seller to the Participating Funds pursuant to a particular repurchase transaction and not yet repurchased hereunder, together with all rights related thereto and all proceeds thereof. (z) "Securities System" shall have the meaning set forth in Paragraph 3(c) of this Agreement. (aa) "Seller" shall have the meaning set forth in the preamble to this Agreement. (bb) "Seller Account" shall have the meaning set forth in the preamble of this Agreement. (cc) "Transaction Account" shall mean a cash account established and maintained by Repo Custodian for the Funds to effect repurchase transactions pursuant to the Master Agreement. (dd) "Transaction Category" shall mean the particular type of repurchase transaction effected hereunder, as determined with reference to the term of the transaction and the categories of Securities that constitute Eligible Securities therefor, which term shall include FICASH I Transactions, FICASH II Transactions, FICASH III Transactions, FITERM I Transactions, FITERM II Transactions, FITERM III Transactions, and such other transaction categories as may from time to time be designated by the Funds by notice to Seller, Custodian and Repo Custodian. 2. Appointment of Repo Custodian. Upon the terms and conditions set forth in this Agreement, Repo Custodian is hereby appointed by the Funds to act as the custodian for the Participating Funds to hold cash, Cash Collateral and Securities for the purpose of effecting repurchase transactions for the Participating Funds through the Joint Trading Account pursuant to the Master Agreement. Repo Custodian hereby acknowledges the terms of the Master Agreement between the Funds and Seller (attached as an Exhibit hereto), as amended from time to time, and agrees to abide by the provisions thereof to the extent such provisions relate to the responsibilities and operations of Repo Custodian hereunder. 3. Maintenance of Transaction Accounts. (a) Repo Custodian shall establish and maintain one or more Transaction Accounts for the purpose of effecting repurchase transactions hereunder for the Funds, in each case pursuant to the Master Agreement. From time to time the Funds may cause Custodian, on behalf of the Funds, to deposit Securities and cash with Repo Custodian in the designated Transaction Account, in each case in accordance with Paragraph 3 of the Master Agreement. (b) Repo Custodian shall keep all Securities, cash and Cash Collateral received for the Participating Funds segregated at all times from those of any other person, firm or corporation in its possession and shall identify all such Securities, cash and Cash Collateral as subject to this Agreement and the Master Agreement. Segregation may be accomplished by physical segregation with respect to certificated securities held by the Repo Custodian and, in addition, by appropriate identification on the books and records of Repo Custodian in the case of all other Securities, cash and Cash Collateral. Title to all Securities and Cash Collateral under a repurchase transaction shall pass to the Participating Funds that are parties to such repurchase transaction. All such Securities and Cash Collateral shall be held by Repo Custodian for the Participating Funds, and shall be subject at all times to the proper instructions of the Participating Funds, or the Custodian on behalf of the Participating Funds, with respect to the holding, transfer or disposition of such Securities and Cash Collateral. Repo Custodian shall include in its records for each Transaction Account all instructions received by it which evidence an interest of the Participating Funds in the Securities and Cash Collateral and shall hold physically segregated any written agreement, receipt or other writing received by it which evidences an interest of the Participating Funds in the Securities and Cash Collateral. (c) Any requirement to "deliver" or "transfer" cash or Cash Collateral to the Participating Funds or to "credit" a Transaction Account under this or any other paragraph of this Agreement shall be made in immediately available funds. If Repo Custodian is required to "deliver" or "transfer" Securities to the Participating Funds under this or any other paragraph of this Agreement, Repo Custodian shall take, or cause to be taken, the following actions to perfect the Participating Funds' interest in such Securities as an outright purchaser: (i) in the case of certificated securities and instruments held by Seller, by physical delivery of the share certificates or other instruments representing the Securities and by physical segregation of such certificates or instruments from the Repo Custodian's other assets in a manner indicating that the Securities are being held for the Participating Funds (such securities and instruments to be delivered in form suitable for transfer or accompanied by duly executed instruments of transfer or assignment in blank and accompanied by such other documentation as the Participating Funds may request), (ii) in the case of Securities held in a customer only account in a clearing agency or federal book-entry system authorized for use by the Funds and meeting the requirements of Rule 17f-4 under the Investment Company Act of 1940, as amended (the "1940 Act") (such authorized agency or system being referred to herein as a "Securities System"), by appropriate entry on the books and records of Repo Custodian identifying the Securities as belonging to the Participating Funds, or (iii) in the case of Securities held in Repo Custodian's own account in a Securities System, by transfer to a customer only account in the Securities System and by appropriate entry on the books and records of Repo Custodian identifying such Securities as belonging to the Participating Funds; provided, further, that Repo Custodian shall confirm to the Participating Funds the identity of the Securities transferred or delivered. Acceptance of a "due bill", "trust receipt" or similar receipt or notification of segregation issued by a third party with respect to Securities held by such third party shall not constitute good delivery of Securities to Repo Custodian for purposes of this Agreement or the Master Agreement and shall expressly violate the terms of this Agreement and the Master Agreement. The Funds shall identify by notice to Repo Custodian and Seller those agencies or systems which have been approved by the Funds for use under this Agreement and the Master Agreement. The Funds hereby notify Repo Custodian and Seller that the following agencies and systems have been approved by the Funds for use under this Agreement and the Master Agreement, until such time as Repo Custodian and Seller shall have been notified by the Funds to the contrary: (i) Participants Trust Company; (ii) The Depository Trust Company; and (iii) any book-entry system as provided in (A) Subpart O of Treasury Circular No. 300, 31 CFR 306.115, (B) Subpart B of Treasury Circular Public Debt Series No. 27-76, 31 CFR 350.2, or (C) the book-entry regulations of federal agencies substantially in the form of 31 CFR 306.115. 4. Repurchase Transactions. (a) Repo Custodian shall make all credits and debits to the Transaction Account and effect the transfer of Securities to or from the Participating Funds upon proper instructions received from the Participating Funds, or the Custodian on behalf of the Participating Funds, and shall make all credits and debits to the Seller Account and effect the transfer of Securities to or from the Seller upon proper instructions received from Seller. In the event that Repo Custodian receives conflicting proper instructions from Seller and the Participating Funds, or the Custodian on behalf of the Participating Funds, Repo Custodian shall follow the Participating Funds' or the Custodian's proper instructions. The Participating Funds shall give Repo Custodian only such instructions as shall be permitted by the Master Agreement. Notwithstanding the preceding sentence, the Participating Funds, or the Custodian on behalf of the Participating Funds, may from time to time instruct Repo Custodian to transfer cash from the Transaction Account to Custodian. (b) (i) Whenever on any Banking Day one or more Funds and Seller agree to enter into a repurchase transaction, Seller and the Participating Funds, or the Custodian on behalf of the Participating Funds, will give Repo Custodian proper instructions by telephone or otherwise on the Sale Date, specifying the Transaction Category, Repurchase Date, Sale Price, Repurchase Price or the applicable Pricing Rate and the Margin Percentage for each such repurchase transaction. (ii) In the case of repurchase transactions in which the Repurchase Date is the Banking Day next following the Sale Date (x) the Participating Funds may increase or decrease the Sale Price for any such repurchase transaction by no more than 10% of the initial Sale Price by causing to be delivered further proper instructions by telephone or otherwise to Repo Custodian prior to the close of business on the Sale Date and (y) Seller and the Participating Funds may by mutual consent agree to increase or decrease the Sale Price by more than 10% of the initial Sale Price by causing to be provided further proper instructions to Repo Custodian by the close of business on the Sale Date. In any event, Repo Custodian shall not be responsible for determining whether any such increase or decrease of the Sale Price exceeds the 10% limitation. (c) Seller will take such actions as are necessary to ensure that on the Sale Date the aggregate Market Value of all Securities held by Repo Custodian for Seller and cash in the Seller Account equals or exceeds the Margin Percentage of the Sale Price. Seller shall give Repo Custodian proper instructions specifying with respect to each of the Securities which is to be the subject of a repurchase transaction (a) the name of the issuer and the title of the Securities, and (b) the Market Value of such Securities. Such instructions shall constitute Seller's instructions to Repo Custodian to transfer the Securities to the Participating Funds and/or Cash Collateral from the Seller Account to the Transaction Account. (d) Prior to the close of business on the Sale Date, the Participating Funds shall transfer to, or maintain on deposit with, Repo Custodian in the Transaction Account immediately available funds in an amount equal to the Sale Price with respect to a particular repurchase transaction. (e) Prior to the close of business on the Sale Date, Repo Custodian shall transfer Securities from Seller to the Participating Funds and/or cash held in the Seller Account to the Transaction Account and shall transfer to the Seller Account immediately available funds from the Transaction Account in accordance with the following provisions: (i) Repo Custodian shall determine that all securities to be transferred by Seller to the Participating Funds are Eligible Securities. Any securities which are not Eligible Securities for a particular repurchase transaction hereunder shall not be included in the calculations set forth below and shall not be transferred to the Participating Funds. (ii) Repo Custodian shall then calculate the aggregate Market Value of the Securities and cash, if any, to be so transferred. (iii) Repo Custodian shall notify Seller in the event that the aggregate Market Value of Securities and cash, if any, applicable to the repurchase transaction is less than the Margin Percentage of the Sale Price and Seller shall transfer, by the close of business on the Sale Date, to Repo Custodian additional Securities and/or cash in the amount of such deficiency. If Seller does not, by the close of business on the Sale Date, transfer additional Securities and/or cash, the Market Value of which equals or exceeds such deficiency, Repo Custodian may, at its option, without notice to Seller, advance the amount of such deficiency to Seller in order to effectuate the repurchase transaction. It is expressly agreed that Repo Custodian is not obligated to make an advance to Seller to enable it to complete any repurchase transaction. (iv) Subject to the provisions of Subparagraph (v) below, Repo Custodian shall cause the Securities applicable to the repurchase transaction received from Seller to be transferred to the Participating Funds and shall cause any cash received from Seller to be transferred to the Transaction Account, against transfer of the Sale Price from the Transaction Account to the Seller Account, such transfers of Securities and/or cash and funds to occur simultaneously on a delivery versus payment basis. (v) Notwithstanding anything to the contrary, if, for any repurchase transaction, the amount of immediately available funds in the Transaction Account is less than the agreed upon Sale Price in connection with the repurchase transaction immediately prior to effectuating such repurchase transaction, or if the aggregate Market Value of the Securities and cash, if any, applicable to such repurchase transaction is less than the Sale Price multiplied by the Margin Percentage immediately prior to effectuating such repurchase transaction, Repo Custodian shall effect the repurchase transaction to the best of its ability by transferring Securities from Seller to the Participating Funds and/or cash from the Seller Account to the Transaction Account with an aggregate Market Value equal to the lesser of (x) the amount of immediately available funds in the Transaction Account multiplied by the Margin Percentage and (y) the aggregate Market Value of the Securities available for transfer from Seller to the Participating Funds and cash, if any, in the Seller Account, against the transfer of immediately available funds from the Transaction Account to the Seller Account in an amount equal to the aggregate Market Value of the Securities and/or cash to be transferred divided by the Margin Percentage; provided, however, that in either such event Repo Custodian shall have the right not to transfer to the Participating Funds such Securities and not to transfer such cash, if any, to the Transaction Account and not to transfer from the designated Transaction Account such funds as Repo Custodian determines, in its sole discretion, will not be the subject of a repurchase transaction. The actions of Repo Custodian pursuant to this subparagraph (e)(v) shall not affect the obligations and liabilities of the parties to each other pursuant to the Master Agreement with regard to such repurchase transaction. (f) In the event that on a Banking Day Seller desires to substitute Securities applicable to such repurchase transaction with Eligible Securities and/or Cash Collateral (to the extent provided in the Master Agreement), Repo Custodian shall perform such substitution in accordance with the following provisions: (i) Repo Custodian shall determine that all securities to be transferred to the Participating Funds are Eligible Securities. Any securities which are not eligible for repurchase transactions hereunder shall not be included in the calculations set forth below and shall not be transferred to the Participating Funds. (ii) Repo Custodian shall then calculate the aggregate Market Value of the Eligible Securities and/or Cash Collateral to be transferred. Repo Custodian shall not make any substitution if, at the time of substitution, the aggregate Market Value of all Securities and any Cash Collateral applicable to such repurchase transaction immediately after such substitution would be less than the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were the date of substitution). (iii) Repo Custodian shall then deliver to the Seller, subject to the qualifications set forth above, the Securities to be substituted against the delivery by Repo Custodian of substitute Eligible Securities to the Participating Funds and/or the crediting of the Transaction Account with Cash Collateral. (iv) In the event Seller has caused Repo Custodian to credit the Transaction Account with Cash Collateral in lieu of substitute Eligible Securities, and has failed to deliver Eligible Securities against such Cash Collateral not later than the close of business on such Banking Day in accordance with the terms of the Master Agreement, Repo Custodian shall promptly, but in no event later than 10:00 a.m. the following Banking Day, notify the Participating Funds and Seller of such failure. (g) With respect to each repurchase transaction, at 10:00 a.m. New York time, or at such other time as specified in proper instructions of the Participating Funds (or the Custodian on behalf of the Participating Funds) on the Repurchase Date, Repo Custodian shall debit the Seller Account and credit the Transaction Account in the amount of the Repurchase Price and shall transfer Securities from the Participating Funds to the Seller and Cash Collateral, if any, from the Transaction Account to the Seller Account in accordance with the following provisions: (i) If the amount of available funds in the Seller Account equals or exceeds the Repurchase Price, Repo Custodian shall debit the Seller Account and credit the Transaction Account in the amount of the Repurchase Price and shall transfer all Securities applicable to such repurchase transaction from the Participating Funds to the Seller and debit the Transaction Account and credit the Seller Account in the amount of any Cash Collateral applicable to such repurchase transaction. (ii) If the amount of available funds in the Seller Account is less than the Repurchase Price, then Repo Custodian shall notify the Seller of the amount of the deficiency and Seller shall promptly cause such amount to be transferred to the Seller Account. If Seller fails to cause the transfer of the entire amount of the deficiency to the Seller Account, then Repo Custodian may, at its option and without notice to Seller, advance to Seller the amount of such remaining deficiency. It is expressly agreed that Repo Custodian is not obligated to make any advance to Seller. If, following such transfer and/or advance, the amount of available funds in the Seller Account equals or exceeds the Repurchase Price then Repo Custodian shall debit the Seller Account and credit the Transaction Account in the amount of the Repurchase Price and shall transfer from the Participating Funds to the Seller all Securities applicable to such repurchase transaction and debit the Transaction Account and credit the Seller Account in the amount of any Cash Collateral applicable to such repurchase transaction. (iii) If the Seller fails to cause the transfer of the entire amount of the deficiency, as required by (ii) above, and Repo Custodian fails to advance to Seller an amount sufficient to eliminate the entire deficiency, then Repo Custodian shall debit the Seller Account in the amount of all immediately available funds designated by Seller as applicable to the repurchase transaction and credit the Transaction Account in such amount (such amount being referred to as the "Partial Payment") and shall transfer Securities from the Participating Funds to the Seller such that the aggregate Market Value of all remaining Securities and Cash Collateral in the Transaction Account with respect to such repurchase transaction shall at least equal the difference between Margin Percentage of the Repurchase Price and the Partial Payment. 5. Payments on Securities. Repo Custodian shall credit to the Seller Account as soon as received, all principal, interest and other sums paid by or on behalf of the issuer in respect of the Securities and collected by Repo Custodian, except as otherwise provided in Paragraph 8 of the Master Agreement. 6. Daily Statement. On each Banking Day on which any Participating Funds have an outstanding repurchase transaction, Repo Custodian shall deliver by facsimile to Custodian and to the Participating Funds a statement identifying the Securities held by Repo Custodian with respect to such repurchase transaction and the cash and Cash Collateral, if any, held by Repo Custodian in the Transaction Account, including a statement of the then current Market Value of such Securities and the amounts, if any, credited to the Transaction Account as of the close of trading on the previous Banking Day. Repo Custodian shall also deliver to Custodian and the Participating Funds such additional statements as the Participating Funds may reasonably request. 7. Valuation. (a) Repo Custodian shall confirm the Market Value of Securities and the amount of Cash Collateral, if any (i) on the Sale Date prior to transferring the Sale Price out of the Transaction Account to the Seller Account against the receipt from Seller of the Securities and Cash Collateral, if any, and (ii) on each Banking Day on which such repurchase transaction is outstanding. If on any Banking Day the aggregate Market Value of the Securities and Cash Collateral with respect to any repurchase transaction is less than the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Banking Day) for such transaction, Repo Custodian shall promptly, but in any case no later than 10:00 a.m. the following Banking Day, notify Seller. If on any Banking Day the aggregate market value of the Securities and Cash Collateral with respect to any repurchase transaction is less than the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Banking Day) for such transaction, and Seller fails to deliver additional Eligible Securities applicable to such repurchase transaction or an additional amount of Cash Collateral by the close of business on such Banking Day such that the aggregate market value of the Securities and Cash Collateral at least equals the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Banking Day), Repo Custodian shall promptly, but in any event no later than 10:00 a.m. the following Banking Day, notify the Participating Funds of such failure. For purposes of determining Seller's margin maintenance requirements on the Sale Date for repurchase transactions in which the Repurchase Date is the Banking Day immediately following the Sale Date, such aggregate market value shall equal at least the Margin Percentage of the Sale Price. (b) Repo Custodian shall determine the bid side portion of the Market Value of the Securities by reference to the independent pricing services ("Pricing Services") set forth on Schedule B. It is understood and agreed that Repo Custodian shall use the prices made available by the Pricing Services on the Banking Day of such determination unless Seller and the Participating Funds mutually agree that some other prices shall be used and so notify Repo Custodian by proper instructions of the sum of the prices of all such Securities priced in such different manner. In the event that Repo Custodian is unable to obtain a valuation of any Securities from the Pricing Services, Repo Custodian shall request a bid quotation from a broker's broker or a broker dealer, set forth in Schedule B, other than Seller. In the event Repo Custodian is unable to obtain a bid quotation for any Securities from such a broker's broker or a broker dealer, Repo Custodian (i) shall not include any such Securities in the determination of whether the aggregate Market Value of the Securities and any Cash Collateral equals at least the Margin Percentage of the Repurchase Price and (ii) shall redeliver such Securities to Seller if the Market Value of all other Securities and any Cash Collateral with respect to such repurchase transaction equals at least the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Banking Day). The Repo Custodian may rely on prices quoted by Pricing Services, broker's brokers or broker dealers, except Seller, as set forth in Schedule B. (c) (i) If, on any Banking Day, the aggregate Market Value of the Securities and any Cash Collateral with respect to a repurchase transaction is less than the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Banking Day) applicable to such repurchase transaction, Repo Custodian shall deliver to the Participating Funds an amount of additional Eligible Securities applicable to such repurchase transaction and/or debit the Seller Account and credit the Transaction Account with an additional amount of Cash Collateral, such that the aggregate Market Value of all Securities and any Cash Collateral with respect to such repurchase transaction shall equal at least the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Banking Day) applicable to such repurchase transaction; except that, for purposes of determining Seller's margin maintenance requirements on the Sale Date for repurchase transactions in which the Repurchase Date is the Banking Day immediately following the Sale Date, such aggregate market value shall equal at least the Margin Percentage of the Sale Price. (ii) If, on any Banking Day, the aggregate Market Value of the Securities and any Cash Collateral with respect to a repurchase transaction exceeds the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Banking Day) applicable to such repurchase transaction, Repo Custodian shall return to the Seller all or a portion of such Securities or Cash Collateral, if any; provided that the Market Value of the remaining Securities and any Cash Collateral with respect to the repurchase transaction shall be at least equal to the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Banking Day) applicable to such repurchase transaction. At any time and from time to time with respect to any repurchase transaction, if authorized by the Participating Funds, or the Custodian on behalf of the Participating Funds, the Repo Custodian shall debit the Transaction Account by an amount of Cash Collateral and credit the Seller Account by the same amount of Cash Collateral against simultaneous delivery from Seller to the Participating Funds of Eligible Securities applicable to such repurchase transaction with a Market Value at least equal to the amount of Cash Collateral credited and debited. 8. Authorized Persons. Schedule C hereto sets forth those persons who are authorized to act for Repo Custodian, Custodian, Seller and the Funds, respectively, under this Agreement. 9. Proper Instructions. Proper instructions shall mean a tested telex, facsimile, a written request, direction, instruction or certification signed or initialed by or on behalf of the party giving the instructions by one or more authorized persons (as provided in Paragraph 8); provided, however, that no instructions directing the delivery of Securities or the payment of funds to any individual who is an authorized signatory of Custodian or Repo Custodian shall be signed by that individual. Telephonic, other oral or electro-mechanical or electronic instructions (including the code which may be assigned by Repo Custodian to Custodian from time to time) given by one of the above authorized persons shall also be considered proper instructions if the party receiving such instructions reasonably believes them to have been given by an authorized person with respect to the transaction involved. Oral instructions will be confirmed by tested telex, facsimile or in writing in the manner set forth above. The Funds authorize Repo Custodian to tape record any and all telephonic or other oral instructions given to Repo Custodian. Proper instructions may relate to specific transactions or to types or classes of transactions, and may be in the form of standing instructions. 10. Standard of Care. (a) Repo Custodian shall be obligated to exercise reasonable care and diligence in carrying out the provisions of this Agreement and the Master Agreement and shall be liable to each of the Funds and Seller for any expenses or damages to the Funds or Seller for breach of Repo Custodian's standard of care in this Agreement, as further provided in this Paragraph. Repo Custodian assumes responsibility for loss to any property held by it pursuant to the provisions of this Agreement which is occasioned by the negligence of, or conversion, misappropriation or theft by, Repo Custodian's officers, employees and agents. Repo Custodian, at its option, may insure itself against loss from any cause but shall be under no obligation to obtain insurance directly for the benefit of the Funds. So long as and to the extent that Repo Custodian exercises reasonable care and diligence and acts without negligence, misfeasance or misconduct, Repo Custodian shall not be liable to Seller or the Funds for (i) any action taken or omitted in good faith in reliance upon proper instructions, (ii) any action taken or omitted in good faith upon any notice, request, certificate or other instrument reasonably believed by it to be genuine and to be signed by the proper party or parties, (iii) any delay or failure to act as may be required under this Agreement or under the Master Agreement when such delay or failure is due to any act of God or war, (iv) the actions or omissions of a Securities System, (v) the title, validity or genuineness of any security received, delivered or held by it pursuant to this Agreement or the Master Agreement, (vi) the legality of the purchase or sale of any Securities by or to the Participating Funds or Seller or the propriety of the amount for which the same are purchased or sold (except to the extent of Repo Custodian's obligations hereunder to determine whether securities are Eligible Securities and to calculate the Market Value of Securities and any Cash Collateral), (vii) the due authority of any person listed on Schedule C to act on behalf of Custodian, Seller or the Funds, as the case may be, with respect to this Agreement or (viii) the errors of the Pricing Services, broker's brokers or broker dealers set forth in Schedule B. (b) Repo Custodian shall not be liable to Seller or the Funds for, or considered to be the custodian of, any Eligible Securities or any money to be used in a repurchase transaction, whether or not such money is represented by any check, draft, or other instrument for the payment of money, until the Eligible Securities have been delivered in accordance with Paragraph 3 or until Repo Custodian actually receives and collects such money on behalf of Seller or the Funds directly or by the final crediting of the Seller Account or a Transaction Account through the Securities System, except that this Paragraph 10(b) shall not be deemed to limit the liability of Repo Custodian to Seller or the Funds if the non-delivery of such Eligible Securities or the failure to receive and collect such money results from the breach by Repo Custodian of its obligations under this Agreement or the Master Agreement. (c) Repo Custodian shall not be under any duty or obligation to ascertain whether any Securities at any time delivered to or held by it are such as properly may be held by the Participating Funds; provided that notwithstanding anything to the contrary herein, Repo Custodian shall be obligated to act in accordance with the guidelines and proper instructions of the Participating Funds, or the Custodian on behalf of the Participating Funds, with respect to the types of Eligible Securities and the issuers of such Eligible Securities that may be used in specific repurchase transactions. (d) Repo Custodian promptly shall notify the Fund Agent and the Custodian if Securities held by Repo Custodian are in default or if payment on any Securities has been refused after due demand and presentation and Repo Custodian shall take action to effect collection of any such amounts upon the proper instructions of the Participating Funds, or the Custodian on behalf of the Participating Funds, and assurances satisfactory to it that it will be reimbursed for its costs and expenses in connection with any such action. (e) Repo Custodian shall have no duties, other than such duties as are necessary to effectuate repurchase transactions in accordance with this Agreement and the Master Agreement within the standard of care set forth in Paragraph 10(a) above and in a commercially reasonable manner. 11. Representations and Additional Covenants of Repo Custodian. (a) Repo Custodian represents and warrants that (i) it is duly authorized to execute and deliver this Agreement and to perform its obligations hereunder and has taken all necessary action to authorize such execution, delivery and performance, (ii) the execution, delivery and performance of this Agreement do not and will not violate any ordinance, declaration of trust, partnership agreement, articles of incorporation, charter, rule or statute applicable to it or any agreement by which it is bound or by which any of its assets are affected, (iii) the person executing this Agreement on its behalf is duly and properly authorized to do so, (iv) it has (and will maintain) a copy of this Agreement and evidence of its authorization in its official books and records, and (v) this Agreement has been executed by one of its duly authorized officers at the level of Vice President or higher. (b) Repo Custodian further represents and warrants that (i) it has not pledged, encumbered, hypothecated, transferred, disposed of, or otherwise granted, any third party an interest in any Securities, (ii) it does not have any security interest, lien or right of setoff in the Securities, and (iii) it has not been notified by any third party, in its capacity as Repo Custodian, custodian bank or clearing bank, of the existence of any lien, claim, charge or encumbrance with respect to any Securities that are the subject of such repurchase transaction. Repo Custodian agrees that (i) it will not pledge, encumber, hypothecate, transfer, dispose of, or otherwise grant, any third party an interest in any Securities, (ii) it will not acquire any security interest, lien or right of setoff in the Securities, and (iii) it will promptly notify the Fund Agent, if, during the term of any outstanding repurchase transaction, it is notified by any third party, in its capacity as Repo Custodian, custodian bank or clearing bank, of the Participating Funds or Seller, of the existence of any lien, claim, charge or encumbrance with respect to any Securities that are the subject of such repurchase transaction. 12. Indemnification. (a) Notwithstanding the Participating Fund's obligation to the Repo Custodian under Paragraph 12(b) below, so long as and to the extent that Repo Custodian is in the exercise of reasonable care and diligence and acts without negligence, misfeasance or misconduct, Seller will indemnify Repo Custodian and hold it harmless against any and all losses, claims, damages, liabilities or actions to which it may become subject, and reimburse it for any expenses (including attorneys' fees and expenses) incurred by it in connection therewith, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon or in any way related to this Agreement, the Master Agreement or those arrangements. Without limiting the generality of the foregoing indemnification, Repo Custodian shall be indemnified by Seller for all costs and expenses, including attorneys' fees, for its successful defense against claims that Repo Custodian breached its standard of care and was negligent or engaged in misfeasance or misconduct. (b) So long as and to the extent that Repo Custodian is in the exercise of reasonable care and diligence and acts without negligence, misconduct or misfeasance, the Participating Funds will indemnify Repo Custodian and hold it harmless against any and all losses, claims, damages, liabilities or actions to which it may become subject, and reimburse it for any expenses (including attorneys' fees and expenses) incurred by it in connection therewith, insofar as such losses, claims, damages, liabilities or actions result from the negligence, misconduct or misfeasance of the Participating Funds under this Agreement. 13. Rights and Remedies. The rights and remedies conferred upon the parties hereto shall be cumulative, and the exercise or waiver of any thereof shall not preclude or inhibit the exercise of any additional rights and remedies. 14. Modification or Amendment. Except as otherwise provided in this Paragraph 14, no modification, waiver or amendment of this Agreement shall be binding unless in writing and executed by the parties hereto. Schedule A, listing the Funds, may be amended from time to time to add or delete Funds by the Funds (i) delivering an executed copy of an addendum to Schedule A to Seller and Repo Custodian, and (ii) amending Schedule A to the Master Agreement in accordance with the provisions therein. The amendment of Schedule A as provided above shall constitute appointment of Repo Custodian as a custodian for such Fund. Schedule B may be amended from time to time by an instrument in writing, or counterpart thereof, executed by Repo Custodian, Seller and the Funds. Schedule C may be amended from time to time to change an authorized person of: (i) the Funds, by written notice to Repo Custodian and Seller by Ms. Sarah Zenoble or the Treasurer of the Funds (or such persons who may be authorized from time to time in writing by Ms. Zenoble or the President or Treasurer of Fidelity Management and Research Company to trade on behalf of Fidelity's taxable money market funds); (ii) Seller, by written notice to Repo Custodian and the Funds by any Vice President of Seller; (iii) Repo Custodian, by written notice to Seller, Custodian and the Funds by any Vice President of Repo Custodian; and (iv) Custodian, by written notice to Repo Custodian by any Vice President of Custodian. Schedule D may be amended from time to time by any party hereto by delivery of written notice to the other parties hereto. Repo Custodian shall receive notice of any amendment to the Master Agreement at the address set forth in Schedule D hereto; and, if such amendment would have a material adverse effect on the rights of, or would materially increase the obligations of Repo Custodian under this Agreement, any such amendment shall also require the consent of Repo Custodian. Any such amendment shall be deemed not to be material if Repo Custodian fails to object in writing within 21 days after receipt of notice thereof. No amendment to this Agreement shall affect the rights or obligations of any Fund with respect to any outstanding repurchase transaction entered into under this Agreement and the Master Agreement prior to such amendment or with respect to any actions or omissions by any party hereto prior to such amendment. In the event of conflict between this Agreement and the Master Agreement, the Master Agreement shall control. 15. Termination. This Agreement shall terminate forthwith upon termination of the Master Agreement or may be terminated by any party hereto on ten Banking Days' written notice to the other parties; provided, however, that any such termination shall not affect any repurchase transaction then outstanding or any rights or obligations under this Agreement or the Master Agreement with respect to any actions or omissions of any party hereto prior to termination. In the event of termination, Repo Custodian will deliver any Securities, Cash Collateral or cash held by it or any agent to Custodian or to such successor custodian or custodian or subcustodian as the Participating Funds shall instruct. 16. Compensation. Seller agrees to pay Repo Custodian compensation for the services to be rendered hereunder, based upon rates which shall be agreed upon from time to time. 17. Notices. Except with respect to communications between Custodian and the Funds which shall be governed by the custodian agreement or subcustodian agreement between such parties, as the case may be, and except as otherwise provided herein or as the parties to the Agreement shall from time to time otherwise agree, all instructions, notices, reports and other communications contemplated by this Agreement shall be given to the party entitled to receive such notice at the telephone number and address listed on Schedule D hereto. 18. Severability. If any provision of this Agreement is held to be unenforceable as a matter of law, the other terms and provisions hereof shall not be affected thereby and shall remain in full force and effect. 19. Binding Nature. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their successors and assignees; provided that, no party hereto may assign this Agreement or any of the rights or obligations hereunder without the prior written consent of the other parties. 20. Headings. Section headings are for reference purposes only and shall not be construed as a part of this Agreement. 21. Counterparts. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one instrument. 22. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF. 23. Limitation of Liability. Seller is hereby expressly put on notice that the Declarations of Trust or the Certificates and Agreements of Limited Partnership, as the case may be, of each Participating Fund contain a limitation of liability provision pursuant to which the obligations assumed by such Participating Fund hereunder shall be limited in all cases to such Participating Fund and its assets or, in the case of a series Fund, to the assets of that series only, and neither Seller nor its respective agents or assigns shall seek satisfaction of any such obligation from the officers, employees, agents, directors, trustees, shareholders or partners of any such Participating Fund or series. 24. Rights and Obligations of Each Fund. The rights and obligations set forth in this Agreement with respect to each repurchase transaction shall accrue only to the Participating Funds in accordance with their respective interests therein. No other Fund shall receive any rights or have any liabilities arising from any action or inaction of any Participating Fund under this Agreement with respect to such repurchase transaction. 25. General Provisions. This Agreement supersedes any other custodian agreement by and among Seller, the Funds, and Repo Custodian concerning repurchase transactions effected through the Joint Trading Account. It is understood and agreed that time is of the essence with respect to the performance of each party's respective obligations hereunder. 26. Disclosure Relating to Certain Federal Protections The parties acknowledge that they have been advised that: (a) In the case of transactions in which one of the parties is a broker or dealer registered with the SEC under Section 15 of the Exchange Act, the Securities Investor Protection Corporation has taken the position that the provisions of the Securities Investor Protection Act of 1970 (the "SIPA") do not protect the other party with respect to any transaction hereunder; and (b) In the case of transactions in which one of the parties is a government securities broker or a government securities dealer registered with the SEC under Section 15C of the Exchange Act, SIPA will not provide protection to the other party with respect to any transaction hereunder. [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK] IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written. [Signature Lines Omitted] SCHEDULE B PRICING SOURCES PRICING SERVICES U.S. Government Securities Interactive Data Services or Mellon Data Services (or any other pricing service mutually agreed upon by Seller and the Funds) GNMA - The Bond Buyer FHLMC - The Bond Buyer All other U.S. Government and Agency Securities Interactive Data Services or Mellon Data Services (or any other pricing service mutually agreed upon by Seller and the Funds) BROKERS' BROKERS AND BROKER DEALERS U.S. Government Securities - Any Primary Dealer GNMA - Any Primary Broker-Dealer's bid rate for such security FHLMC - Any Primary Broker-Dealer's bid rate for such security All other U.S. Government and Agency Securities - Any Primary Broker-Dealer's bid rate for such security Prices shall be as of the business day of the date of determination or the last quote available. The pricing services, Brokers' Brokers and Broker Dealers may be changed from time to time by agreement of all the parties. SCHEDULE C AUTHORIZED PERSONS Repo Custodian Ken Rindos Kurt Woetzel Custodian Ken Rindos Kurt Woetzel Seller Joseph P. Blauvelt Michael B. Boyer Robert E. Curry Patrick Doyle Frank Forgione Edward J. Frederick Christopher Juliano Joseph Marrone Thomas T. McGee John S. Mehrtens John A. Michielini Allen Smith, II The Funds Barron, Leland C. Harlow, Katharyn M. Stehman, Burnell R. Carbone, John M. Henning, Frederick L. Jr. Todd, Deborah Curtis, Fritz Huyck, Timothy Todd, John J. Duby, Robert K. Jamen, Jon Torres, Joseph E. Egan, Dorothy T. Litterst, Robert Williams, Richard Glocke, David Silver, Samuel Zenoble, Sarah SCHEDULE D NOTICES If to Custodian: The Bank of New York One Wall Street, 4th Floor New York, NY 10286 Telephone: (212) 635-7947 Attention: Sherman Yu, Esq. With a copy to the Fund Agent If to Repo Custodian: The Bank of New York One Wall Street, 4th Floor New York, New York 10286 Telephone: (212) 635-4809 Attention: Ms. Kristin Smith If to Seller: J.P. Morgan Securities Inc. 60 Wall Street New York, New York 10260 Telephone: (212) 483-2323 Attention: Middle Office Traders Support If to any of the Funds: FMR Texas Inc. 400 East Las Colinas Blvd., CP9M Irving, Texas 75039 Telephone: (214) 584-7800 Attention: Ms. Deborah R. Todd or Mr. Samuel Silver If to the Fund Agent: Fidelity Investments [Name of Fund] 400 East Las Colinas Blvd., CP9E Irving, Texas 75039 Telephone: (214) 584-4071 Attention: Mr. Mark Mufler 277282.c1 Exhibit 8(m) FORM OF SCHEDULE 1 The following lists the additional counterparties to the Repo Custodian Agreement for Joint Trading Account between The Bank of New York and the Fidelity Funds: BZW Government Securities, Inc. CS First Boston Corp. Daiwa Securities America, Inc. Deutsche Bank Securities Corp. Donaldson, Lufkin & Jenerette Securities Corp. Fuji Securities, Inc. Goldman Sachs & Co Morgan Stanley & Co., Inc. NationsBanc Capital Markets Nikko Securities Co. International, Inc. Nomura Securities International, Inc. Prudential Securities, Inc. Salomon Brothers, Inc. Sanwa BJK Securities Co., LP SBC Capital Markets, Inc. Smith Barney, Inc. EX-99.B8 13 Exhibit 8(n) Form of FIDELITY GROUP REPO CUSTODIAN AGREEMENT FOR JOINT TRADING ACCOUNT AGREEMENT dated as of ________, among CHEMICAL BANK, a banking corporation organized under the laws of the State of New York ("Repo Custodian"), GREENWICH CAPITAL MARKETS, INC. ("Seller") and each of the entities listed on Schedule A-1, A-2, A-3 and A-4 hereto acting on behalf of itself or (i) in the case of a series company, on behalf of one or more of its portfolios or series listed on Schedule A-1 or A-2 hereto, (ii) in the case of the accounts listed on Schedule A-3 hereto, acting through Fidelity Management & Research Company, and (iii) in the case of the commingled or individual accounts listed on Schedule A-4 hereto, acting through Fidelity Management Trust Company (collectively, the "Funds" and each, a "Fund"). WITNESSETH WHEREAS, each of the Funds has entered into a master repurchase agreement dated as of _____________, (the "Master Agreement") with Seller pursuant to which from time to time one or more of the Funds, as buyers, and Seller, as seller, may enter into repurchase transactions effected through one or more joint trading accounts (collectively, the "Joint Trading Account") established and administered by one or more custodians of the Funds identified on Schedule C hereto (each a "Custodian"); and, WHEREAS, in each such repurchase transaction Seller will sell to such Funds certain Securities (as hereinafter defined) selected from Eligible Securities (as hereinafter defined) held by Repo Custodian , subject to an agreement by Seller to repurchase such Securities; and WHEREAS, Repo Custodian currently maintains a cash and securities account (the "Seller Account") for Seller for the purpose of, among other things, effecting repurchase transactions hereunder; and WHEREAS, the Funds desire that the Repo Custodian serve as the custodian for each of the Funds in connection with the repurchase transactions effected hereunder, and that the Repo Custodian hold cash, Cash Collateral (as hereinafter defined) and Securities for each of the Funds for the purpose of effecting repurchase transactions hereunder. NOW THEREFORE, the parties hereto hereby agree as follows: 1. Definitions. Whenever used in this Agreement, the following terms shall have the meanings set forth below: (a) "Banking Day" shall mean any day on which the Funds, Seller Custodian, Repo Custodian, and the Federal Reserve Banks where the Custodian and the Repo Custodian are located, are each open for business. (b) "Cash Collateral" shall mean all cash, denominated in U.S. Dollars, credited by Repo Custodian to a Transaction Account pursuant to Paragraphs 3, 6, 8 or 9 of the Master Agreement. (c) "Custodian" shall have the meaning set forth in the preamble of this Agreement. (d) "Eligible Securities" shall mean those securities which are identified as permissible securities for a particular Transaction Category. (e) "FICASH I Transaction" and "FICASH III Transaction" shall mean a repurchase transaction in which the Repurchase Date is the Banking Day next following the Sale Date and for which securities issued by the government of the United States of America that are direct obligations of the government of the United States of America shall constitute Eligible Securities. (f) "FICASH II Transaction" shall mean a repurchase transaction in which the Repurchase Date is the Banking Day next following the Sale Date and for which one or more of the following two categories of securities, as specified by the Funds, shall constitute Eligible Securities: (x) securities issued by the government of the United States of America that are direct obligations of the government of the United States of America, or (y) securities issued by or guaranteed as to principal and interest by the government of the United States of America, or by its agencies and/or instrumentalities, including, but not limited to, the Federal Home Loan Bank, Federal Home Loan Mortgage Corp., Government National Mortgage Association, Federal National Mortgage Association, Federal Farm Credit Bank, Federal Intermediate Credit Bank, Banks for Cooperatives, and Federal Land Banks. (g) "FITERM I Transaction" and "FITERM III Transaction" shall mean a repurchase transaction in which the Repurchase Date is a date fixed by agreement between Seller and the Participating Funds which is not the Banking Day next following the Sale Date, or if applicable, the date fixed upon exercise of an Unconditional Resale Right (as hereinafter defined) by the Participating Funds and for which securities issued by the government of the United States of America that are direct obligations of the government of the United States of America shall constitute Eligible Securities. (h) "FITERM II Transaction" shall mean a repurchase transaction in which the Repurchase Date is a date fixed by agreement between Seller and the Participating Funds which is not the Banking Day next following the Sale Date, or, if applicable, the date fixed upon exercise of an Unconditional Resale Right (as hereinafter defined) by the Participating Funds and for which one or more of the following two categories of securities, as specified by the Funds, shall constitute Eligible Securities: (x) securities issued by the government of the United States of America that are direct obligations of the government of the United States of America, or (y) securities issued by or guaranteed as to principal and interest by the government of the United States of America, or by its agencies and/or instrumentalities, including, but not limited to, the Federal Home Loan Bank, Federal Home Loan Mortgage Corp., Government National Mortgage Association, Federal National Mortgage Association, Federal Farm Credit Bank, Federal Intermediate Credit Bank, Banks for Cooperatives, and Federal Land Banks. (i) "Fund" shall have the meaning set forth in the preamble of this Agreement. (j) "Fund Agent" shall mean the agent for the Participating Funds designated in Paragraph 18 of the Master Agreement. (k) "Joint Trading Account" shall have the meaning set forth in the preamble of this Agreement. (l) "Margin Percentage" with respect to any repurchase transaction shall be 102% or such other percentage as is agreed to by Seller and the Participating Funds (except that in no event shall the Margin Percentage be less than 100%). (m) "Market Value" shall have the meaning set forth in Paragraph 4 of the Master Agreement. (n) "Master Agreement" shall have the meaning set forth in the preamble of this Agreement. (o) "1940 Act" shall mean have the meaning set forth in Paragraph 3(c) of this Agreement. (p) "Partial Payment" shall have the meaning set forth in Section 4(g) of this Agreement. (q) "Participating Funds" shall mean those Funds that are parties to a particular repurchase transaction effected through the Joint Trading Account. (r) "Pricing Rate" shall mean the per annum percentage rate agreed to by Seller and the Participating Funds for a particular repurchase transaction. (s) "Pricing Services" shall have the meaning set forth in Paragraph 7 of this Agreement. (t) "Repo Custodian" shall have the meaning set forth in the preamble of this Agreement. (u) "Repurchase Date" shall mean the date fixed by agreement between Seller and the Participating Funds on which the Seller is to repurchase Securities and Cash Collateral, if any, from the Participating Funds and the Participating Funds are to resell the Securities and Cash Collateral, if any, including any date determined by application of the provisions of Paragraphs 7(a) and 15 of the Master Agreement. (v) "Repurchase Price" for each repurchase transaction shall mean the Sale Price, plus an incremental amount determined by applying the Pricing Rate to the Sale Price, calculated on the basis of a 360-day year and the number of actual days elapsed from (and including) the Sale Date to (but excluding) the Repurchase Date. (w) "Sale Date" shall mean the Banking Day on which Securities and Cash Collateral, if any, are to be sold to the Participating Funds by Seller pursuant to a repurchase transaction hereunder. (x) "Sale Price" shall mean the price agreed upon by the Participating Funds and Seller at which the Securities and Cash Collateral, if any, are to be sold to the Participating Funds by Seller. (y) "Securities" shall mean all Eligible Securities delivered by Seller or to be delivered by Seller to the Participating Funds pursuant to a particular repurchase transaction and not yet repurchased hereunder, together with all rights related thereto and all proceeds thereof. (z) "Securities System" shall have the meaning set forth in Paragraph 3(c) of this Agreement. (aa) "Seller" shall have the meaning set forth in the preamble to this Agreement. (bb) "Seller Account" shall have the meaning set forth in the preamble of this Agreement. (cc) "Transaction Account" shall mean a cash account established and maintained by Repo Custodian for the Funds to effect repurchase transactions pursuant to the Master Agreement. (dd) "Transaction Category" shall mean the particular type of repurchase transaction effected hereunder, as determined with reference to the term of the transaction and the categories of Securities that constitute Eligible Securities therefor, which term shall include FICASH I Transactions, FICASH II Transactions, FICASH III Transactions, FITERM I Transactions, FITERM II Transactions, FITERM III Transactions, and such other transaction categories as may from time to time be designated by the Funds by notice to Seller, Custodian and Repo Custodian. (ee) "Unconditional Resale Right" shall have the meaning set forth in Paragraph 7(b) of the Master Agreement. (ff) "Valuation Day" shall mean any day on which Repo Custodian is open for business. 2. Appointment of Repo Custodian. Upon the terms and conditions set forth in this Agreement, Repo Custodian is hereby appointed by the Funds to act as the custodian for the Participating Funds to hold cash, Cash Collateral and Securities for the purpose of effecting repurchase transactions for the Participating Funds through the Joint Trading Account pursuant to the Master Agreement. Repo Custodian hereby acknowledges the terms of the Master Agreement between the Funds and Seller (attached as an Exhibit hereto), as amended from time to time, and agrees to abide by the provisions thereof to the extent such provisions relate to the responsibilities and operations of Repo Custodian hereunder. 3. Maintenance of Transaction Accounts. (a) Repo Custodian shall establish and maintain one or more Transaction Accounts for the purpose of effecting repurchase transactions hereunder for the Funds, in each case pursuant to the Master Agreement. From time to time the Funds may cause Custodian, on behalf of the Funds, to deposit Securities and cash with Repo Custodian in the designated Transaction Account, in each case in accordance with Paragraph 3 of the Master Agreement. (b) Repo Custodian shall keep all Securities, cash and Cash Collateral received for the Participating Funds segregated at all times from those of any other person, firm or corporation in its possession and shall identify all such Securities, cash and Cash Collateral as subject to this Agreement and the Master Agreement. Segregation may be accomplished by physical segregation with respect to certificated securities held by the Repo Custodian and, in addition, by appropriate identification on the books and records of Repo Custodian in the case of all other Securities, cash and Cash Collateral. Title to all Securities and Cash Collateral under a repurchase transaction shall pass to the Participating Funds that are parties to such repurchase transaction. All such Securities and Cash Collateral shall be held by Repo Custodian for the Participating Funds, and shall be subject at all times to the proper instructions of the Participating Funds, or the Custodian on behalf of the Participating Funds, with respect to the holding, transfer or disposition of such Securities and Cash Collateral. Repo Custodian shall include in its records for each Transaction Account all instructions received by it which evidence an interest of the Participating Funds in the Securities and Cash Collateral and shall hold physically segregated any written agreement, receipt or other writing received by it which evidences an interest of the Participating Funds in the Securities and Cash Collateral. (c) Any requirement to "deliver" or "transfer" cash or Cash Collateral to the Participating Funds or to "credit" a Transaction Account under this or any other paragraph of this Agreement shall be made in immediately available funds. If Repo Custodian is required to "deliver" or "transfer" Securities to the Participating Funds under this or any other paragraph of this Agreement, Repo Custodian shall take, or cause to be taken, the following actions to perfect the Participating Funds' interest in such Securities as an outright purchaser: (i) in the case of certificated securities and instruments held by Seller, by physical delivery of the share certificates or other instruments representing the Securities and by physical segregation of such certificates or instruments from the Repo Custodian's other assets in a manner indicating that the Securities are being held for the Participating Funds (such securities and instruments to be delivered in form suitable for transfer or accompanied by duly executed instruments of transfer or assignment in blank and accompanied by such other documentation as the Participating Funds may request), (ii) in the case of Securities held in a customer only account in a clearing agency or federal book-entry system authorized for use by the Funds and meeting the requirements of Rule 17f-4 under the Investment Company Act of 1940, as amended (the "1940 Act") (such authorized agency or system being referred to herein as a "Securities System"), by appropriate entry on the books and records of Repo Custodian identifying the Securities as belonging to the Participating Funds, or (iii) in the case of Securities held in Repo Custodian's own account in a Securities System, by transfer to a customer only account in the Securities System and by appropriate entry on the books and records of Repo Custodian identifying such Securities as belonging to the Participating Funds; provided, further, that Repo Custodian shall confirm to the Participating Funds the identity of the Securities transferred or delivered. Acceptance of a "due bill", "trust receipt" or similar receipt or notification of segregation issued by a third party with respect to Securities held by such third party shall not constitute good delivery of Securities to Repo Custodian for purposes of this Agreement or the Master Agreement and shall expressly violate the terms of this Agreement and the Master Agreement. The Funds shall identify by notice to Repo Custodian and Seller those agencies or systems which have been approved by the Funds for use under this Agreement and the Master Agreement. The Funds hereby notify Repo Custodian and Seller that the following agencies and systems have been approved by the Funds for use under this Agreement and the Master Agreement, until such time as Repo Custodian and Seller shall have been notified by the Funds to the contrary: (i) Participants Trust Company; (ii) The Depository Trust Company; and (iii) any book-entry system as provided in (A) Subpart O of Treasury Circular No. 300, 31 CFR 306.115, (B) Subpart B of Treasury Circular Public Debt Series No. 27-76, 31 CFR 350.2, or (C) the book-entry regulations of federal agencies substantially in the form of 31 CFR 306.115. 4. Repurchase Transactions. (a) Repo Custodian shall make all credits and debits to the Transaction Account and effect the transfer of Securities to or from the Participating Funds upon proper instructions received from the Participating Funds, or the Custodian on behalf of the Participating Funds, and shall make all credits and debits to the Seller Account and effect the transfer of Securities to or from the Seller upon proper instructions received from Seller. In the event that Repo Custodian receives conflicting proper instructions from Seller and the Participating Funds, or the Custodian on behalf of the Participating Funds, Repo Custodian shall follow the Participating Funds' or the Custodian's proper instructions. The Participating Funds shall give Repo Custodian only such instructions as shall be permitted by the Master Agreement. Notwithstanding the preceding sentence, the Participating Funds, or the Custodian on behalf of the Participating Funds, may from time to time instruct Repo Custodian to transfer cash from the Transaction Account to Custodian so long as such transfer is not in contravention of the Master Agreement. (b) (i) Whenever on any Banking Day one or more Funds and Seller agree to enter into a repurchase transaction, Seller and the Participating Funds, or the Custodian on behalf of the Participating Funds, will give Repo Custodian proper instructions by telephone or otherwise by 5:00 p.m. New York time on the Sale Date, specifying the Transaction Category, Repurchase Date, Sale Price, Repurchase Price or the applicable Pricing Rate and the Margin Percentage for each such repurchase transaction. (ii) In the case of repurchase transactions in which the Repurchase Date is the Banking Day next following the Sale Date (x) the Participating Funds may increase or decrease the Sale Price for any such repurchase transaction by no more than 10% of the initial Sale Price by causing to be delivered further proper instructions by telephone or otherwise to Repo Custodian by 5:15 p.m. New York time (or at such later time as may be agreed upon by the parties) on the Sale Date and (y) Seller and the Participating Funds may by mutual consent agree to increase or decrease the Sale Price by more than 10% of the initial Sale Price by causing to be provided further proper instructions to Repo Custodian by the close of business on the Sale Date. In any event, Repo Custodian shall not be responsible for determining whether any such increase or decrease of the Sale Price exceeds the 10% limitation. (c) Seller will take such actions as are necessary to ensure that on the Sale Date the aggregate Market Value of all Securities held by Repo Custodian for Seller and cash in the Seller Account equals or exceeds the Margin Percentage of the Sale Price. Seller shall give Repo Custodian proper instructions specifying with respect to each of the Securities which is to be the subject of a repurchase transaction (a) the name of the issuer and the title of the Securities, and (b) the Market Value of such Securities. Such instructions shall constitute Seller's instructions to Repo Custodian to transfer the Securities to the Participating Funds and/or Cash Collateral from the Seller Account to the Transaction Account. (d) By 5:00 p.m. New York Time on the Sale Date, the Participating Funds shall transfer to, or maintain on deposit with, Repo Custodian in the Transaction Account immediately available funds in an amount equal to the Sale Price with respect to a particular repurchase transaction. (e) Prior to the close of business on the Sale Date, Repo Custodian shall transfer Securities from Seller to the Participating Funds and/or cash held in the Seller Account to the Transaction Account and shall transfer to the Seller Account immediately available funds from the Transaction Account in accordance with the following provisions: (i) Repo Custodian shall determine that all securities to be transferred by Seller to the Participating Funds are Eligible Securities. Any securities which are not Eligible Securities for a particular repurchase transaction hereunder shall not be included in the calculations set forth below and shall not be transferred to the Participating Funds. (ii) Repo Custodian shall then calculate the aggregate Market Value of the Securities and cash, if any, to be so transferred. (iii) Repo Custodian shall notify Seller in the event that the aggregate Market Value of Securities and cash, if any, applicable to the repurchase transaction is less than the Margin Percentage of the Sale Price and Seller shall transfer, by the close of business on the Sale Date, to Repo Custodian additional Securities and/or cash in the amount of such deficiency. If Seller does not, by the close of business on the Sale Date, transfer additional Securities and/or cash, the Market Value of which equals or exceeds such deficiency, Repo Custodian may, at its option, without notice to Seller, advance the amount of such deficiency to Seller in order to effectuate the repurchase transaction. It is expressly agreed that Repo Custodian is not obligated to make an advance to Seller to enable it to complete any repurchase transaction. (iv) Subject to the provisions of Subparagraph (v) below, Repo Custodian shall cause the Securities applicable to the repurchase transaction received from Seller to be transferred to the Participating Funds and shall cause any cash received from Seller to be transferred to the Transaction Account, against transfer of the Sale Price from the Transaction Account to the Seller Account, such transfers of Securities and/or cash and funds to be deemed to occur simultaneously. (v) Notwithstanding anything to the contrary, if, for any repurchase transaction, the amount of immediately available funds in the Transaction Account is less than the agreed upon Sale Price in connection with the repurchase transaction immediately prior to effectuating such repurchase transaction, or if the aggregate Market Value of the Securities and cash, if any, applicable to such repurchase transaction is less than the Sale Price multiplied by the Margin Percentage immediately prior to effectuating such repurchase transaction, Repo Custodian shall effect the repurchase transaction to the best of its ability by transferring Securities from Seller to the Participating Funds and/or cash from the Seller Account to the Transaction Account with an aggregate Market Value equal to the lesser of (x) the amount of immediately available funds in the Transaction Account multiplied by the Margin Percentage and (y) the aggregate Market Value of the Securities available for transfer from Seller to the Participating Funds and cash, if any, in the Seller Account, against the transfer of immediately available funds from the Transaction Account to the Seller Account in an amount equal to the aggregate Market Value of the Securities and/or cash to be transferred divided by the Margin Percentage; provided, however, that in either such event Repo Custodian shall have the right not to transfer to the Participating Funds such Securities and not to transfer such cash, if any, to the Transaction Account and not to transfer from the designated Transaction Account such funds as Repo Custodian determines, in its sole discretion, will not be the subject of a repurchase transaction. The actions of Repo Custodian pursuant to this subparagraph (e)(v) shall not affect the obligations and liabilities of the parties to each other pursuant to the Master Agreement with regard to such repurchase transaction. (f) In the event that on a Banking Day Seller desires to substitute Securities applicable to such repurchase transaction with Eligible Securities and/or Cash Collateral (to the extent provided in the Master Agreement), Repo Custodian shall perform such substitution in accordance with the following provisions: (i) Repo Custodian shall determine that all securities to be transferred to the Participating Funds are Eligible Securities. Any securities which are not eligible for repurchase transactions hereunder shall not be included in the calculations set forth below and shall not be transferred to the Participating Funds. (ii) Repo Custodian shall then calculate the aggregate Market Value of the Eligible Securities and/or Cash Collateral to be transferred. Repo Custodian shall not make any substitution if, at the time of substitution, the aggregate Market Value of all Securities and any Cash Collateral applicable to such repurchase transaction immediately after such substitution would be less than the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were the date of substitution). (iii) Repo Custodian shall then deliver to the Seller, subject to the qualifications set forth above, the Securities to be substituted against the delivery by Repo Custodian of substitute Eligible Securities to the Participating Funds and/or the crediting of the Transaction Account with Cash Collateral. (iv) In the event Seller has caused Repo Custodian to credit the Transaction Account with Cash Collateral in lieu of substitute Eligible Securities, and has failed to deliver Eligible Securities against such Cash Collateral not later than the close of business on such Banking Day in accordance with the terms of the Master Agreement, Repo Custodian shall promptly, but in no event later than 10:00 a.m. the following Banking Day, notify the Participating Funds and Seller of such failure. (g) With respect to each repurchase transaction, at 9:00 a.m. New York time, or at such other time as specified in proper instructions of the Participating Funds (or the Custodian on behalf of the Participating Funds) on the Repurchase Date, Repo Custodian shall debit the Seller Account and credit the Transaction Account in the amount of the Repurchase Price and shall transfer Securities from the Participating Funds to the Seller and Cash Collateral, if any, from the Transaction Account to the Seller Account in accordance with the following provisions: (i) If the amount of available funds in the Seller Account equals or exceeds the Repurchase Price, Repo Custodian shall debit the Seller Account and credit the Transaction Account in the amount of the Repurchase Price and shall transfer all Securities applicable to such repurchase transaction from the Participating Funds to the Seller and debit the Transaction Account and credit the Seller Account in the amount of any Cash Collateral applicable to such repurchase transaction. (ii) If the amount of available funds in the Seller Account is less than the Repurchase Price, then Repo Custodian shall notify the Seller of the amount of the deficiency and Seller shall promptly cause such amount to be transferred to the Seller Account. If Seller fails to cause the transfer of the entire amount of the deficiency to the Seller Account, then Repo Custodian may, at its option and without notice to Seller, advance to Seller the amount of such remaining deficiency. It is expressly agreed that Repo Custodian is not obligated to make any advance to Seller. If, following such transfer and/or advance, the amount of available funds in the Seller Account equals or exceeds the Repurchase Price then Repo Custodian shall debit the Seller Account and credit the Transaction Account in the amount of the Repurchase Price and shall transfer from the Participating Funds to the Seller all Securities applicable to such repurchase transaction and debit the Transaction Account and credit the Seller Account in the amount of any Cash Collateral applicable to such repurchase transaction. (iii) If the Seller fails to cause the transfer of the entire amount of the deficiency, as required by (ii) above, and Repo Custodian fails to advance to Seller an amount sufficient to eliminate the entire deficiency, then Repo Custodian shall debit the Seller Account in the amount of all immediately available funds designated by Seller as applicable to the repurchase transaction and credit the Transaction Account in such amount (such amount being referred to as the "Partial Payment") and shall transfer Securities from the Participating Funds to the Seller such that the aggregate Market Value of all remaining Securities and Cash Collateral in the Transaction Account with respect to such repurchase transaction shall at least equal the difference between Margin Percentage of the Repurchase Price and the Partial Payment. 5. Payments on Securities. Repo Custodian shall credit to the Seller Account as soon as received, all principal, interest and other sums paid by or on behalf of the issuer in respect of the Securities and collected by Repo Custodian, except as otherwise provided in Paragraph 8 of the Master Agreement. 6. Daily Statement. On each Banking Day on which any Participating Funds have an outstanding repurchase transaction, Repo Custodian shall deliver by facsimile, or other electronic means acceptable to the Participating Funds, the Custodian and the Repo Custodian, to Custodian and to the Participating Funds a statement identifying the Securities held by Repo Custodian with respect to such repurchase transaction and the cash and Cash Collateral, if any, held by Repo Custodian in the Transaction Account, including a statement of the then current Market Value of such Securities and the amounts, if any, credited to the Transaction Account as of the close of trading on the previous Banking Day. Repo Custodian shall also deliver to Custodian and the Participating Funds such additional statements as the Repo Custodian and the Participating Funds may agree upon from time to time. 7. Valuation. (a) Repo Custodian shall confirm the Market Value of Securities and the amount of Cash Collateral, if any (i) on the Sale Date prior to transferring the Sale Price out of the Transaction Account to the Seller Account against the receipt from Seller of the Securities and Cash Collateral, if any, and (ii) on each Valuation Day on which such repurchase transaction is outstanding. If on any Valuation Day the aggregate Market Value of the Securities and Cash Collateral with respect to any repurchase transaction is less than the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Valuation Day) for such transaction, Repo Custodian shall promptly, but in any case no later than 10:00 a.m. the following Valuation Day, notify Seller. If on any Valuation Day the aggregate market value of the Securities and Cash Collateral with respect to any repurchase transaction is less than the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Valuation Day) for such transaction, and Seller fails to deliver additional Eligible Securities applicable to such repurchase transaction or an additional amount of Cash Collateral by the close of business on such Valuation Day such that the aggregate market value of the Securities and Cash Collateral at least equals the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Valuation Day), Repo Custodian shall promptly, but in any event no later than 10:00 a.m. the following Valuation Day, notify the Participating Funds of such failure. (b) Repo Custodian shall determine the bid side portion of the Market Value of the Securities by reference to the independent pricing services ("Pricing Services") set forth on Schedule B. It is understood and agreed that Repo Custodian shall use the prices made available by the Pricing Services at the close of business of the preceding Valuation Day. In the event that Repo Custodian is unable to obtain a valuation of any Securities from the Pricing Services, Repo Custodian shall request a bid quotation from a broker's broker or a broker dealer, set forth in Schedule B, other than Seller. In the event Repo Custodian is unable to obtain a bid quotation for any Securities from such a broker's broker or a broker dealer, Repo Custodian (i) shall not include any such Securities in the determination of whether the aggregate Market Value of the Securities and any Cash Collateral equals at least the Margin Percentage of the Repurchase Price and (ii) shall redeliver such Securities to Seller if the Market Value of all other Securities and any Cash Collateral with respect to such repurchase transaction equals at least the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Valuation Day). The Repo Custodian may rely on prices quoted by Pricing Services, broker's brokers or broker dealers, except Seller, as set forth in Schedule B. (c) (i) If, on any Valuation Day, the aggregate Market Value of the Securities and any Cash Collateral with respect to a repurchase transaction is less than the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Valuation Day) applicable to such repurchase transaction, Repo Custodian shall deliver to the Participating Funds an amount of additional Eligible Securities applicable to such repurchase transaction and/or debit the Seller Account and credit the Transaction Account with an additional amount of Cash Collateral, such that the aggregate Market Value of all Securities and any Cash Collateral with respect to such repurchase transaction shall equal at least the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Valuation Day) applicable to such repurchase transaction. (ii) If, on any Valuation Day, the aggregate Market Value of the Securities and any Cash Collateral with respect to a repurchase transaction exceeds the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Valuation Day) applicable to such repurchase transaction, Repo Custodian shall return to the Seller all or a portion of such Securities or Cash Collateral, if any; provided that the Market Value of the remaining Securities and any Cash Collateral with respect to the repurchase transaction shall be at least equal to the Margin Percentage of the Repurchase Price (calculated as if the Repurchase Date were such Valuation Day) applicable to such repurchase transaction. At any time and from time to time with respect to any repurchase transaction, if authorized by the Participating Funds, or the Custodian on behalf of the Participating Funds, the Repo Custodian shall debit the Transaction Account by an amount of Cash Collateral and credit the Seller Account by the same amount of Cash Collateral against simultaneous delivery from Seller to the Participating Funds of Eligible Securities applicable to such repurchase transaction with a Market Value at least equal to the amount of Cash Collateral credited and debited. 8. Authorized Persons. Schedule C hereto sets forth those persons who are authorized to act for Repo Custodian, Custodian, Seller and the Funds, respectively, under this Agreement. 9. Proper Instructions. Proper instructions shall mean a tested telex, facsimile, a written request, direction, instruction or certification signed or initialed by or on behalf of the party giving the instructions by one or more authorized persons (as provided in Paragraph 8); provided, however, that no instructions directing the delivery of Securities or the payment of funds to any individual who is an authorized signatory of Custodian or Repo Custodian shall be signed by that individual. Telephonic, other oral or electro-mechanical or electronic instructions (including the code which may be assigned by Repo Custodian to Custodian from time to time) given by one of the above authorized persons shall also be considered proper instructions if the party receiving such instructions reasonably believes them to have been given by an authorized person with respect to the transaction involved. Oral instructions will be confirmed by tested telex, facsimile or in writing in the manner set forth above. The Funds and Seller authorize Repo Custodian to tape record any and all telephonic or other oral instructions given to Repo Custodian. Proper instructions may relate to specific transactions or to types or classes of transactions, and may be in the form of standing instructions. 10. Standard of Care. (a) Repo Custodian shall be obligated to use reasonable care and diligence in carrying out the provisions of this Agreement and the Master Agreement and shall be liable to the Funds and/or Seller only for direct damages resulting from the negligence or willful misconduct of the Repo Custodian or its officers, employees or agents. The parties hereby agree that Repo Custodian shall not be liable for consequential, special or indirect damages, even if Repo Custodians has been advised as to the possibility thereof. So long as and to the extent that Repo Custodian exercises reasonable care and diligence and acts without negligence, misfeasance or misconduct, Repo Custodian shall not be liable to Seller or the Funds for (i) any action taken or omitted in good faith in reliance upon proper instructions, (ii) any action taken or omitted in good faith upon any notice, request, certificate or other instrument reasonably believed by it to be genuine and to be signed by the proper party or parties, (iii) any delay or failure to act as may be required under this Agreement or under the Master Agreement when such delay or failure is due to any act of God or war, (iv) the actions or omissions of a Securities System, (v) the title, validity or genuineness of any security received, delivered or held by it pursuant to this Agreement or the Master Agreement, (vi) the legality of the purchase or sale of any Securities by or to the Participating Funds or Seller or the propriety of the amount for which the same are purchased or sold (except to the extent of Repo Custodian's obligations hereunder to determine whether securities are Eligible Securities and to calculate the Market Value of Securities and any Cash Collateral), (vii) the due authority of any person listed on Schedule C to act on behalf of Custodian, Seller or the Funds, as the case may be, with respect to this Agreement or (viii) the errors of the Pricing Services, broker's brokers or broker dealers set forth in Schedule B. (b) Repo Custodian shall not be liable to Seller or the Funds for, or considered to be the custodian of, any Eligible Securities or any money to be used in a repurchase transaction, whether or not such money is represented by any check, draft, or other instrument for the payment of money, until the Eligible Securities have been delivered in accordance with Paragraph 3 or until Repo Custodian actually receives and collects such money on behalf of Seller or the Funds directly or by the final crediting of the Seller Account or a Transaction Account through the Securities System, except that this Paragraph 10(b) shall not be deemed to limit the liability of Repo Custodian to Seller or the Funds if the non-delivery of such Eligible Securities or the failure to receive and collect such money results from the breach by Repo Custodian of its obligations under this Agreement or the Master Agreement. (c) Repo Custodian shall not be under any duty or obligation to ascertain whether any Securities at any time delivered to or held by it are such as properly may be held by the Participating Funds; provided that notwithstanding anything to the contrary herein, Repo Custodian shall be obligated to act in accordance with the guidelines and proper instructions of the Participating Funds, or the Custodian on behalf of the Participating Funds, with respect to the types of Eligible Securities and the issuers of such Eligible Securities that may be used in specific repurchase transactions. (d) Repo Custodian promptly shall notify the Fund Agent and the Custodian if Securities held by Repo Custodian are in default or if payment on any Securities has been refused after due demand and presentation and Repo Custodian shall take action to effect collection of any such amounts upon the proper instructions of the Participating Funds, or the Custodian on behalf of the Participating Funds, and assurances satisfactory to it that it will be reimbursed for its costs and expenses in connection with any such action. (e) Repo Custodian shall have no duties, other than such duties as are necessary to effectuate repurchase transactions in accordance with this Agreement and the Master Agreement within the standard of care set forth in Paragraph 10(a) above and in a commercially reasonable manner. 11. Representations and Additional Covenants of Repo Custodian. (a) Repo Custodian represents and warrants that (i) it is duly authorized to execute and deliver this Agreement and to perform its obligations hereunder and has taken all necessary action to authorize such execution, delivery and performance, (ii) the execution, delivery and performance of this Agreement do not and will not violate any ordinance, declaration of trust, partnership agreement, articles of incorporation, charter, rule or statute applicable to it or any agreement by which it is bound or by which any of its assets are affected, (iii) the person executing this Agreement on its behalf is duly and properly authorized to do so, (iv) it has (and will maintain) a copy of this Agreement and evidence of its authorization in its official books and records, and (v) this Agreement has been executed by one of its duly authorized officers at the level of Vice President or higher. (b) Repo Custodian further represents and warrants that (i) it has not pledged, encumbered, hypothecated, transferred, disposed of, or otherwise granted, any third party an interest in any Securities, (ii) it does not have any security interest, lien or right of setoff in the Securities, and (iii) it has not received notification from any third party, in its capacity as Repo Custodian, custodian bank or clearing bank, of any lien, claim, charge or encumbrance with respect to any Securities that are the subject of such repurchase transaction. Repo Custodian agrees that (i) it will not pledge, encumber, hypothecate, transfer, dispose of, or otherwise grant, any third party an interest in any Securities, (ii) it will not acquire any security interest, lien or right of setoff in the Securities, and (iii) it will promptly notify the Fund Agent, if, during the term of any outstanding repurchase transaction, it is notified by any third party, in its capacity as Repo Custodian, custodian bank or clearing bank, of the Participating Funds or Seller, of the existence of any lien, claim, charge or encumbrance with respect to any Securities that are the subject of such repurchase transaction. 12. Indemnification. (a) Notwithstanding the Participating Fund's obligation to the Repo Custodian under Paragraph 12(b) below, so long as and to the extent that Repo Custodian is in the exercise of reasonable care and diligence and acts without negligence, misfeasance or misconduct, Seller will indemnify Repo Custodian and hold it harmless against any and all losses, claims, damages, liabilities or actions to which it may become subject, and reimburse it for any expenses (including attorneys' fees and expenses) incurred by it in connection therewith, insofar as such losses, claims, damages, liabilities or actions arise out of or are based upon or in any way related to this Agreement, the Master Agreement or any transactions contemplated hereby or thereby or effected hereunder or thereunder. Without limiting the generality of the foregoing indemnification, Repo Custodian shall be indemnified by Seller for all costs and expenses, including attorneys' fees, for its successful defense against claims that Repo Custodian breached its standard of care and was negligent or engaged in misfeasance or misconduct. (b) So long as and to the extent that Repo Custodian is in the exercise of reasonable care and diligence and acts without negligence, misconduct or misfeasance, the Participating Funds will indemnify Repo Custodian and hold it harmless against any and all losses, claims, damages, liabilities or actions to which it may become subject, and reimburse it for any expenses (including attorneys' fees and expenses) incurred by it in connection therewith, insofar as such losses, claims, damages, liabilities or actions result from the negligence, misconduct or misfeasance of the Participating Funds under this Agreement. 13. Rights and Remedies. The rights and remedies conferred upon the parties hereto shall be cumulative, and the exercise or waiver of any thereof shall not preclude or inhibit the exercise of any additional rights and remedies. 14. Modification or Amendment. Except as otherwise provided in this Paragraph 14, no modification, waiver or amendment of this Agreement shall be binding unless in writing and executed by the parties hereto. Schedule A, listing the Funds, may be amended from time to time to add or delete Funds by the Funds (i) delivering an executed copy of an addendum to Schedule A to Seller and Repo Custodian, and (ii) amending Schedule A to the Master Agreement in accordance with the provisions therein. The amendment of Schedule A as provided above shall constitute appointment of Repo Custodian as a custodian for such Fund. Schedule B may be amended from time to time by an instrument in writing, or counterpart thereof, executed by Repo Custodian, Seller and the Funds. Schedule C may be amended from time to time to change an authorized person of: (i) the Funds, by written notice to Repo Custodian and Seller by Ms. Sarah Zenoble or the Treasurer of the Funds (or such persons who may be authorized from time to time in writing by Ms. Zenoble or the President or Treasurer of Fidelity Management and Research Company to trade on behalf of Fidelity's taxable money market funds); (ii) Seller, by written notice to Repo Custodian and the Funds by any Vice President of Seller; (iii) Repo Custodian, by written notice to Seller, Custodian and the Funds by any Vice President of Repo Custodian; and (iv) Custodian, by written notice to Repo Custodian by any Vice President of Custodian. Schedule D may be amended from time to time by any party hereto by delivery of written notice to the other parties hereto. Repo Custodian shall receive notice of any amendment to the Master Agreement at the address set forth in Schedule D hereto; and, if such amendment would have a material adverse effect on the rights of, or would materially increase the obligations of Repo Custodian under this Agreement, any such amendment shall also require the consent of Repo Custodian. Any such amendment shall be deemed not to be material if Repo Custodian fails to object in writing within 21 days after receipt of notice thereof. No amendment to this Agreement shall affect the rights or obligations of any Fund with respect to any outstanding repurchase transaction entered into under this Agreement and the Master Agreement prior to such amendment or with respect to any actions or omissions by any party hereto prior to such amendment. In the event of conflict between this Agreement and the Master Agreement, the Master Agreement shall control. 15. Termination. This Agreement shall terminate forthwith upon termination of the Master Agreement or may be terminated by any party hereto on ten Valuation Days' written notice to the other parties; provided, however, that any such termination shall not affect any repurchase transaction then outstanding or any rights or obligations under this Agreement or the Master Agreement with respect to any actions or omissions of any party hereto prior to termination. In the event of termination, Repo Custodian will deliver any Securities, Cash Collateral or cash held by it or any agent to Custodian or to such successor custodian or custodian or subcustodian as the Participating Funds shall instruct. 16. Compensation. Seller agrees to pay Repo Custodian compensation for the services to be rendered hereunder, based upon rates which shall be agreed upon from time to time. 17. Notices. Except with respect to communications between Custodian and the Funds which shall be governed by the custodian agreement or subcustodian agreement between such parties, as the case may be, and except as otherwise provided herein or as the parties to the Agreement shall from time to time otherwise agree, all instructions, notices, reports and other communications contemplated by this Agreement shall be given to the party entitled to receive such notice at the telephone number and address listed on Schedule D hereto. 18. Severability. If any provision of this Agreement is held to be unenforceable as a matter of law, the other terms and provisions hereof shall not be affected thereby and shall remain in full force and effect. 19. Binding Nature. This Agreement shall be binding upon and shall inure to the benefit of the parties hereto and their successors and assignees; provided that, no party hereto may assign this Agreement or any of the rights or obligations hereunder without the prior written consent of the other parties. 20. Headings. Section headings are for reference purposes only and shall not be construed as a part of this Agreement. 21. Counterparts. This Agreement may be executed in one or more counterparts, all of which taken together shall constitute one instrument. 22. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES THEREOF. 23. Limitation of Liability. Repo Custodian and Seller are hereby expressly put on notice of the limitation of liability set forth in the Declarations of Trust and in the Certificates and Agreements of Limited Partnership of the Funds and agree that the obligations assumed by any Fund hereunder shall be limited in all cases to a Fund and its assets or, in the case of a series Fund, to the assets of that series only, and neither Seller, Repo Custodian nor their respective agents or assigns shall seek satisfaction of any such obligation from the officers, agents, employees, directors, trustees, shareholders or partners of any such Fund or series. 24. Rights and Obligations of Each Fund. The rights and obligations set forth in this Agreement with respect to each repurchase transaction shall accrue only to the Participating Funds in accordance with their respective interests therein. No other Fund shall receive any rights or have any liabilities arising from any action or inaction of any Participating Fund under this Agreement with respect to such repurchase transaction. 25. General Provisions. This Agreement supersedes any other custodian agreement by and among Seller, the Funds, and Repo Custodian concerning repurchase transactions effected through the Joint Trading Account. It is understood and agreed that time is of the essence with respect to the performance of each party's respective obligations hereunder. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the day and year first above written. [Signature Lines Omitted] SCHEDULE B PRICING SOURCES PRICING SERVICES U.S. Government Securities Interactive Data Services or Mellon Data Services (or any other pricing service mutually agreed upon by Seller and the Funds) GNMA - The Bond Buyer FHLMC - The Bond Buyer All other U.S. Government and Agency Securities Interactive Data Services or Mellon Data Services (or any other pricing service mutually agreed upon by Seller and the Funds) BROKERS' BROKERS AND BROKER DEALERS U.S. Government Securities - Any Primary Dealer GNMA - Any Primary Broker-Dealer's bid rate for such security FHLMC - Any Primary Broker-Dealer's bid rate for such security All other U.S. Government and Agency Securities - Any Primary Broker-Dealer's bid rate for such security Prices shall be as of the business day immediately preceding the date of determination or the last quote available. The pricing services, Brokers' Brokers and Broker Dealers may be changed from time to time by agreement of all the parties. SCHEDULE C AUTHORIZED PERSONS Repo Custodian Anthony Isola Raymond Stancil William Mosca Leonardo Nichols Alan Mann Allen B. Clark Custodian Ken Rindos Kurt Woetzel Seller Gary F. Holloway Konrad R. Kruger Stephen M. Peet Raymond E. Humiston P. Michael Florio Ben Carpenter Blake S. Drexler Derick B. Burgher Lyn Kratovil The Funds Leland Barron Wickliffe Curtis Dorothy Egan David Glocke Katharyn Harlow Timothy Huyck Jon Jamen Robert Litterst Sam Silver Burnell Stehman Jeffrey St. Peters Deborah Todd John Todd Joseph Torres Richard Williams SCHEDULE D NOTICES If to Custodian: Morgan Guaranty Trust Co. of New York 15 Broad Street, 16th Floor New York, New York 10015 Telephone: (212) 483-4150 Attention: Ms. Kimberly Smith or The Bank of New York One Wall Street, 4th Floor New York, NY 10286 Telephone: (312) 635-4808 Attention: Claire Meskovic With a copy to the Fund Agent If to Repo Custodian: Chemical Bank 4 New York Plaza 21st Floor New York, NY 10004-2477 Telephone: (212) 623-6446 Attention: Anthony Isola If to Seller: Greenwich Capital Markets, Inc. 600 Steamboat Road Greenwich, Connecticut 06830 Telephone: (203) 625-7909 Attention: Peter Sanchez If to any of the Funds: FMR Texas Inc. 400 East Las Colinas Blvd., CP9M Irving, Texas 75039 Telephone: (214) 584-7800 Attention: Ms. Deborah R. Todd or Mr. Samuel Silver If to the Fund Agent: Fidelity Investments [Name of Fund] 400 East Las Colinas Blvd., CP9E Irving, Texas 75039 Telephone: (214) 584-4071 Attention: Mr. Mark Mufler 277262.c1 Exhibit 8(n) FORM OF SCHEDULE 1 The following lists the additional counterparties to the Repo Custodian Agreement for Joint Trading Account between Chemical Bank and the Fidelity Funds: Chase Securities, Inc. CS First Boston Corp. Dresdner Securities (U.S.A.), Inc. HSBC Securities, Inc. Lehman Government Securities, Inc. Merrill Lynch Government Securities, Inc. Paine Webber, Inc. Salomon Brothers, Inc. UBS Securities, Inc. EX-99.B8 14 Exhibit 8(o) Form of JOINT TRADING ACCOUNT CUSTODY AGREEMENT Between THE BANK OF NEW YORK and FIDELITY FUNDS Dated as of: _________ Exhibit 8(o) TABLE OF CONTENTS Page ARTICLE I - APPOINTMENT OF CUSTODIAN 2 ARTICLE II - POWERS AND DUTIES OF CUSTODIAN 2 Section 2.01. Establishment of Accounts 2 Section 2.02. Receipt of Funds 2 Section 2.03. Repurchase Transactions 2 Section 2.04. Other Transfers 4 Section 2.05. Custodian's Books and Records 5 Section 2.06. Reports by Independent Certified Public Accountants 5 Section 2.07. Securities System 6 Section 2.08. Collections 6 Section 2.09. Notices, Consents, Etc. 6 Section 2.10. Notice of Custodian's Inability to Perform 7 ARTICLE III - PROPER INSTRUCTIONS AND RELATED MATTERS 7 Section 3.01. Proper Instructions; Special Instruction 7 Section 3.02. Authorized Persons 8 Section 3.03. Investment Limitations 8 Section 3.04. Persons Having Access to Assets of the Funds 8 Section 3.05. Actions of Custodian Based on Proper Instructions and Special Instructions 9 ARTICLE IV - STANDARD OF CARE; INDEMNIFICATION 9 Section 4.02. Liability of Custodian for Actions of Securities Systems 9 Section 4.03. Indemnification 9 Section 4.04. Funds, Right to Proceed 10 ARTICLE V - COMPENSATION 11 Section 5.01. Compensation 11 Section 5.02. Waiver of Right of Set-Off 11 ARTICLE VI - TERMINATION 11 Section 6.01. Events of Termination 11 Section 6.02. Successor Custodian; Payment of Compensation 11 ARTICLE VII - MISCELLANEOUS 12 Section 7.01. Representative Capacity and Binding Obligation 12 Section 7.02. Entire Agreement 12 Section 7.03. Amendments 12 Section 7.04. Interpretation 12 Section 7.05. Captions 13 Section 7.06. Governing Law 13 Section 7.07. Notice and Confirmations 13 Section 7.08. Assignment 14 Section 7.09. Counterparts 14 Section 7.10. Confidentiality; Survival of Obligations 14 Exhibit 8(o) Form of JOINT TRADING ACCOUNT CUSTODY AGREEMENT AGREEMENT dated as of ___________ by and between The Bank of New York (hereinafter referred to as the "Custodian") and each of the entities listed on Schedules A-1, A-2, A-3 and A-4 hereto, acting on behalf of itself or, (i) in the case of a series company, on behalf of one or more of its portfolios or series listed on Schedule A-1 or A-2 hereto, (ii) in the case of the accounts listed on Schedule A-3 hereto, acting through Fidelity Management & Research Company, and (iii) in the case of the commingled or individual accounts listed on Schedule A-4 hereto, acting through Fidelity Management Trust Company (collectively, the "Funds" and each, a "Fund"). W I T N E S S E T H WHEREAS, each of the Funds desire to appoint the Custodian as its custodian for the purpose of establishing and administering one or more joint trading accounts or subaccounts thereof (individually, an "Account" and collectively, the "Accounts") and holding cash and securities for the Funds in connection with repurchase transactions effected through the Accounts; and WHEREAS, one or more of the Funds may, from time to time, enter into one or more written repurchase agreements pursuant to which one or more of the Funds agrees to purchase and resell, and the sellers named in such agreements agree to sell and repurchase through the Accounts, certain securities (collectively, the "Securities") (such repurchase agreements being hereinafter referred to, collectively, as the "Repurchase Agreements"); and WHEREAS, each of the custodians identified in ScheduleB hereto (each, a "Fund Custodian") serves as the primary custodian for one or more of the Funds; and WHEREAS, from time to time one or more of the Funds may arrange to transfer cash or Securities from one or more Fund Custodians to the Custodian or transfer cash or Securities from the Custodian to one or more Fund Custodians, or in the case of Funds in which Custodian is also Fund Custodian, such Fund may arrange for transfer of cash or Securities between an Account and an account maintained by Custodian in its capacity as Fund Custodian for such Fund, in each event in connection with Repurchase Agreement transactions; and WHEREAS, from time to time, such Funds may arrange to transfer cash or securities from the Custodian to the seller in such Repurchase Agreement transactions, or in the case in which Custodian is also the clearing bank for such seller, such Funds may arrange for transfer of cash or securities between an Account and an account maintained by Custodian for such seller in its capacity as clearing bank, in each event in connection with two-party Repurchase Agreement transactions; and WHEREAS, each of the custodians identified in Schedule C hereto (each, a "Repo Custodian") serves as a third-party custodian of the Funds for purposes of effecting third-party Repurchase Agreement transactions; and WHEREAS, from time to time one or more of the Funds may arrange to transfer cash or Securities from the Custodian to one or more Repo Custodians or transfer cash or Securities from one or more Repo Custodians to the Custodian, or in the case in which Custodian is also Repo Custodian, such Funds may arrange for transfer of cash or securities between an Account and an account maintained for such Funds in its capacity as Repo Custodian, in each event in connection with third-party Repurchase Agreement transactions; NOW, THEREFORE, the parties hereto hereby agree as follows: ARTICLE I - APPOINTMENT OF CUSTODIAN Each of the Funds hereby employs and appoints the Custodian as its custodian, subject to the terms and provisions of this Agreement. ARTICLE II - POWERS AND DUTIES OF CUSTODIAN As custodian, the Custodian shall have and perform the powers and duties, and only such powers and duties, as are set forth in this Agreement. Section 2.01. Establishment of Accounts. The Custodian shall establish one or more Accounts as segregated joint trading accounts for the Funds through which the Funds shall, from time to time, effect Repurchase Agreement transactions. Section 2.02. Receipt of Funds. The Custodian shall, from time to time, receive funds for or on behalf of the Funds and shall hold such funds in safekeeping. Upon receipt of Proper Instructions, the Custodian shall credit funds so received to one or more Accounts designated in such Proper Instructions. Promptly after receipt of such funds from the Fund Custodian or a Repo Custodian or promptly following the transfer to an Account from any account maintained by Custodian in its capacity as Fund Custodian, or as Repo Custodian, the Custodian shall provide written confirmation of such receipt to the Fund Custodian or Repo Custodian, when and as applicable, and of such receipt or transfer to the Fund Agent designated in Section 7.07(b) hereof (the "Fund Agent"). The Custodian shall designate on its books and records the funds allocable to each Account and the identity of each Fund participating in such Account. Section 2.03. Repurchase Transactions. The Funds may, from time to time, enter into Repurchase Agreement transactions. In connection with each such Repurchase Agreement transaction, unless otherwise specifically directed by Special Instructions, the Custodian shall take the following actions: (a) Purchase of Securities. Upon receipt of Proper Instructions, the Custodian shall pay for and receive Securities and any cash denominated in U.S. Dollars which is serving as collateral ("Cash Collateral"), provided that payment therefor shall be made by the Custodian only against prior or simultaneous receipt of the Securities and any Cash Collateral in the manner prescribed in subsection 2.03(b) below. Except as provided in Section2.04 hereof, in no event shall the Custodian deliver funds from an Account for the purchase of Securities and any Cash Collateral prior to receipt of the Securities and any Cash Collateral by the Custodian or a Securities System (as hereinafter defined). The Custodian is not under any obligation to make credit available to the Funds to complete transactions hereunder. Promptly after the transfer of funds and receipt of Securities and any Cash Collateral, the Custodian shall provide a confirmation to the Fund Agent, setting forth (i) the Securities and any Cash Collateral which the Custodian has received pursuant to the Repurchase Agreement transaction, (ii) the amount of funds transferred from the applicable Account, and (iii) any security or transaction identification numbers reasonably requested by the Fund Agent. (b) Receipt and Holding of Securities. In connection with each Repurchase Agreement transaction, the Custodian shall receive and hold the Securities as follows: (i) in the case of certificated securities, by physical receipt of the certificates or other instruments representing such Securities and by physical segregation of such certificates or instruments from other assets of the Custodian in a manner indicating that such Securities belong to specified Funds; and (ii) in the case of Securities held in book-entry form by a Securities System (as hereinafter defined), by appropriate transfer and registration of such Securities to a customer only account of the Custodian on the book-entry records of the Securities System, and by appropriate entry on the books and records of the Custodian identifying such Securities as belonging to specified Funds. (c) Sale of Securities. Upon receipt of Proper Instructions, the Custodian shall make delivery of Securities and any Cash Collateral held in or credited to an Account against prior or simultaneous payment for such Securities in immediately available funds in the form of: (i) cash, bank credit, or bank wire transfer received by the Custodian; or (ii) credit to the customer only account of the Custodian with a Securities System. Notwithstanding the foregoing, the Custodian shall make delivery of Securities held in physical form in accordance with "street delivery custom" to a broker or its clearing agent, against delivery to the Custodian of a receipt for such Securities; provided that the Custodian shall have taken all actions possible to ensure prompt collection of the payment for, or the return of such Securities by the broker or its clearing agent. Promptly after the transfer of Securities and any Cash Collateral and the receipt of funds, the Custodian shall provide a confirmation to the Fund Agent, setting forth the amount of funds received by the Custodian or a Securities System for credit to the applicable Account. (d) Additional Functions. Upon receipt of Proper Instructions, the Custodian shall take all such other actions as specified in such Proper Instructions and as shall be reasonable or necessary with respect to Repurchase Agreement transactions and the Securities and funds transferred and received pursuant to such transactions, including, without limitation, all such actions as shall be prescribed in the event of a default under a Repurchase Agreement. (e) Nondiscretionary Functions. The Custodian shall attend to all non-discretionary details in connection with the purchase, sale, transfer or other dealings with Securities or other assets of the Funds held by the Custodian. (f) In the event that the Custodian is directed by Proper Instructions to make any payment or transfer of funds on behalf of a Fund for which there would be, at the close of business on the date of such payment or transfer, insufficient funds held by the Custodian on behalf of such Fund, the Custodian may, in its discretion, provide an overdraft ("Overdraft") to the Fund, in an amount sufficient to allow the completion of such payment or transfer. Any Overdraft provided hereunder: (a) shall be payable on the next Business Day, unless otherwise agreed by the Fund and the Custodian; and (b) shall accrue interest form the date of the Overdraft to the date of payment in full by the Fund at a rate agreed upon in writing, from time to time, by the Custodian and the Fund. The Custodian and the Funds acknowledge that the purpose of such Overdrafts is to temporarily finance the purchase or sale of securities for prompt delivery in accordance with the terms hereof, or to meet emergency expenses not reasonably foreseeable by a particular Fund. The Funds hereby agree that the Custodian shall have a continuing lien and security interest in and to all Securities whose purchase is financed by Custodian and which are in Custodian's possession or in the possession or control of any third party acting on Custodian's behalf and the proceeds thereof. In this regard, Custodian shall be entitled to all the rights and remedies of a pledgee under common law and a secured party under the New York Uniform Commercial Code and any other applicable laws or regulations as then in effect. Section 2.04. Other Transfers. (a) In addition to transfers of funds and Securities referred to in Section 2.03, the Custodian shall transfer funds and Securities held in an Account: (a) upon receipt of Proper Instructions, to (i)any Fund Custodian, or (ii)any other account maintained for any Fund by the Custodian in its capacity as a Fund Custodian, (iii)any Repo Custodian or (iv) any other account maintained for any Fund by the Custodian in its capacity as a Repo Custodian; or (b) upon receipt of Special Instructions, and subject to Section 3.04 hereof, to any other person or entity designated in such Special Instructions. (b) Determination of Fund Custodian Daily Net Amount. On each banking day, based upon daily transaction information provided to the Custodian by the Funds, Custodian shall determine: (i) the amount of cash due to be transferred on such day by each Fund Custodian to the Custodian in connection with all Repurchase Agreement transactions in which the date fixed for the repurchase and resale of Securities is the banking day next following the date on which the sale and purchase of such Securities takes place (each, an "Overnight Repo Transaction") to be effected through the Accounts in such day; and (ii) the amount of cash due to be transferred on such day by Custodian to such Fund Custodian in connection with all outstanding Overnight Repo Transactions previously effected through the Accounts (the difference between (i) and (ii) with respect to each Fund Custodian being referred to as the "Fund Custodian Daily Net Amount"). On each banking day, Custodian shall notify each Fund Custodian of the foregoing determination and, unless otherwise directed in accordance with Proper Instructions, Custodian shall (i) instruct such Fund Custodian to transfer cash to the Custodian equal to the Fund Custodian Daily Net Amount (if the Fund Custodian Daily Net Amount is positive) or (ii) transfer to such Fund Custodian cash equal to the Fund Custodian Daily Net Amount (if the Fund Custodian Daily Net Amount is negative). (c) Determination of Repo Custodian Daily Net Amount. On each banking day, based upon daily transaction information provided to the Custodian by the Funds and each Repo Custodian, Custodian shall determine: (i) the amount of cash due to be transferred on such day by each Repo Custodian on behalf of the Funds to all counterparties in connection with all third-party Overnight Repo Transactions to be effected through the Accounts on such day; and (ii) the amount of cash due to be transferred on such day by each Repo Custodian on behalf of all counterparties to the Funds in connection with all outstanding third-party Overnight Repo Transactions previously effected through the Accounts (the difference between (i) and (ii) with respect to each Repo Custodian being referred to as the "Repo Custodian Daily Net Amount"). On each banking day, Custodian shall notify the Funds of the foregoing determinations and, unless otherwise directed in accordance with Proper Instructions, Custodian shall (i) transfer to each Repo Custodian cash equal to the Repo Custodian Daily Net Amount (if the Repo Custodian Daily Net Amount is positive) or (ii) instruct each Repo Custodian to transfer to the Custodian cash equal to the Repo Custodian Daily Net Amount (if the Repo Custodian Daily Net Amount is negative). Section 2.05. Custodian's Books and Records. The Custodian shall provide any assistance reasonably requested by the Funds in the preparation of reports to shareholders of the Funds and others, audits of accounts, and other ministerial matters of like nature. The Custodian shall maintain complete and accurate records with respect to cash and Securities held for the benefit of the Funds as required by the rules and regulations of the Securities and Exchange Commission applicable to investment companies registered under the Investment Company Act of 1940, as amended (the "Investment Company Act"), including: (a) journals or other records of original entry containing a detailed and itemized daily record of all receipts and deliveries of securities (including certificate and transaction identification numbers, if any), and all receipts and disbursements of cash; (b) ledgers or other records reflecting Securities in transfer, and Securities in physical possession; and (c) cancelled checks and bank records related thereto. The Custodian shall keep such other books and records of the Funds relating to repurchase transactions effected through the Accounts as the Funds shall reasonably request. Such books and records maintained by the Custodian shall reflect at all times the identity of each Fund participating in each Account and the aggregate amount of the Securities and any Cash Collateral held by the Custodian on behalf of the Funds in such Account pursuant to this Agreement. All such books and records maintained by the Custodian shall be maintained in a form acceptable to the Funds and in compliance with the rules and regulations of the Securities and Exchange Commission, including, but not limited to, books and records required to be maintained by Section 31(a) of the Investment Company Act and the rules from time to time adopted thereunder. All books and records maintained by the Custodian relating to the Accounts shall at all times be the property of the Funds and shall be available during normal business hours for inspection and use by the Funds and their agents, including, without limitation, their independent certified public accountants. Notwithstanding the preceding sentence, the Funds shall not take any actions or cause Custodian to take any actions which would cause, either directly or indirectly, the Custodian to violate any applicable laws, regulations, rules or orders. Section 2.06. Reports by Independent Certified Public Accountants. At the request of the Funds, the Custodian shall deliver to the Funds such annual reports and other interim reports prepared by the independent certified public accountants of the Custodian with respect to the services provided by the Custodian under this Agreement, including, without limitation, the Custodian's accounting system, internal accounting control and procedures for safeguarding Securities, including Securities deposited and/or maintained in a Securities System. Such reports, which shall be of sufficient scope and in sufficient detail as may reasonably be required by the Funds and as may reasonably by obtained by the Custodian, shall provide reasonable assurance to the Funds that the procedures employed by the independent certified public accountants are reasonably designed to detect any material inadequacies with respect to the matters discussed in the report, shall state in detail the material inadequacies disclosed by such examination, and, if no such inadequacies exist, shall so state. Section 2.07. Securities System. As used herein the term "Securities System" shall mean each of the following: (a) the Depository Trust Company; (b) the Participants Trust Company; (c) any book-entry system as provided in (i) Subpart0 of Treasury Circular No. 300, 31CFR 306.115, (ii) SubpartB of Treasury Circular Public Debt Series No. 27-76, 31CFR 350.2, or (iii) the book-entry regulations of federal agencies substantially in the form of 31CFR 306.115; or (d) any domestic clearing agency registered with the Securities and Exchange Commission under Section17A of the Securities Exchange Act of 1934, as amended (or as may otherwise be authorized by the Securities and Exchange Commission to serve in the capacity of depository or clearing agent for the securities or other assets of investment companies) which acts as a securities depository and the use of which has been approved in Special Instructions. Use of a Securities System by the Custodian shall be in accordance with applicable Federal Reserve Board and Securities and Exchange Commission rules and regulations, if any, and subject to the following provisions: (A) The Custodian may deposit and/or maintain Securities held hereunder in a Securities System, provided that such Securities are represented in an account of the Custodian in the Securities System which account shall not contain any assets of the Custodian other than assets held as a fiduciary, custodian, or otherwise for customers. (B) The Custodian shall, if requested by the Funds, provide the Funds with all reports obtained by the Custodian with respect to the Securities System's accounting system, internal accounting control and procedures for safeguarding securities deposited in the Securities System. (C) Upon receipt of Special Instructions, the Custodian shall terminate the use hereunder of any Securities System (except for the federal book-entry system) as promptly as practicable and shall take all actions reasonably practicable to safeguard the Securities and other assets of the Funds maintained with such Securities System. Section 2.08. Collections. The Custodian shall (a) collect, receive and deposit in the applicable Account all income and other payments with respect to Securities held by the Custodian hereunder; (b) endorse and deliver any instruments required to effect such collection; and (c) execute ownership and other certificates and affidavits for all federal, state and foreign tax purposes in connection with receipt of income or other payments with respect to Securities, or in connection with the transfer of Securities. Section 2.09. Notices, Consents, Etc. The Custodian shall deliver to the Funds, in the most expeditious manner practicable, all notices, consents or announcements affecting or relating to Securities held by the Custodian on behalf of the Funds that are received by the Custodian, and, upon receipt of Proper Instructions, the Custodian shall execute and deliver such consents or other authorizations as may be required. Section 2.10. Notice of Custodian's Inability to Perform. The Custodian shall promptly notify the Funds in writing by facsimile transmission or such other manner as the Funds may designate, if, for any reason: (a) the Custodian determines that it is unable to perform any of its duties or obligations hereunder or its duties or obligations with respect to any repurchase transaction; or (b) the Custodian reasonably foresees that it will be unable to perform any such duties or obligations. ARTICLE III - PROPER INSTRUCTIONS AND RELATED MATTERS Section 3.01. Proper Instructions; Special Instruction. (a) Proper Instructions. As used herein, the term "Proper Instructions" shall mean: (i) a tested telex, a written (including, without limitation, facsimile transmission) request, direction, instruction or certification signed or initialed by one or more Authorized Persons (as hereinafter defined); (ii) a telephonic or other oral communication by one or more Authorized Persons; or (iii) a communication effected directly between electromechanical or electronic devices or systems (including, without limitation, computers) by one or more Authorized Persons; provided, however, that communications of the types described in clauses (ii) and (iii) above purporting to be given by an Authorized Person shall be considered Proper Instructions only if the Custodian reasonably believes such communications to have been given by an Authorized Person with respect to the transaction involved. Proper Instructions in the form of oral communications shall be confirmed by the Funds by tested telex or in writing in the manner set forth in clause(i) above, but the lack of such confirmation shall in no way affect any action taken by the Custodian in reliance upon such oral instructions prior to the Custodian's receipt of such confirmation. Each of the Funds and the Custodian is hereby authorized to record any and all telephonic or other oral instructions communicated to the Custodian. Proper Instructions may relate to specific transactions or to types or classes of transactions, and may be in the form of standing instructions. (b) Special Instructions. As used herein, the term "Special Instructions" shall mean Proper Instructions countersigned or confirmed in writing by, in the case of the entities listed in Schedules A-1 or A-2 hereto, the Treasurer or any Assistant Treasurer of the Funds or any other person designated in writing by the Treasurer of the Funds, and in the case of each of the entities listed on Schedules A-3 or A-4, by the officer who is a signatory to this Agreement on behalf of such entity or any other person designated in writing by such officer or an officer of such entity of higher authority, which countersignature or written confirmation shall be (i) included on the same instrument containing the Proper Instructions or on a separate instrument relating thereto, and (ii) delivered by hand, by facsimile transmission, or in such other manner as the parties hereto may agree in writing. (c) Address for Proper Instructions and Special Instructions. Proper Instructions and Special Instructions shall be delivered to the Custodian at the address and/or telephone, telecopy or telex number agreed upon from time to time by the Custodian and the Funds. Section 3.02. Authorized Persons. Concurrently with the execution of this Agreement and from time to time thereafter, as appropriate, the Funds shall deliver to the Custodian, duly certified as appropriate by the Treasurer or any Assistant Treasurer of the Funds or by a Secretary or Assistant Secretary of the Funds, and in the case of each of the entities listed on Schedules A-3 or A-4, by the officer who is a signatory to this Agreement on behalf of such entity or any other person designated in writing by such officer or an officer of higher authority, a certificate setting forth (a) the names, signatures and scope of authority of all persons authorized to give Proper Instructions or any other notice, request, direction, instruction, certificate or instrument on behalf of the Funds (collectively, the "Authorized Persons," and individually, an "Authorized Person"), and (b) the names and signatures of those persons authorized to issue Special Instructions. Such certificate may be accepted and relied upon by the Custodian as conclusive evidence of the facts set forth therein and shall be considered to be in full force and effect until delivery to the Custodian of a similar certificate to the contrary. Upon delivery of a certificate which deletes the name of a person previously authorized to give Proper Instructions or to issue Special Instructions, such person shall no longer be considered an Authorized Person or authorized to issue Special Instructions, as applicable. Section 3.03. Investment Limitations. In performing its duties hereunder the Custodian may assume, unless and until it receives special Instructions to the contrary (a "Contrary Notice"), that Proper Instructions received by it are not in conflict with or in any way contrary to any investment or other limitation applicable to any of the Funds. The Custodian shall in no event be liable to the Funds and shall be indemnified by the Funds for any loss, damage or expense to the Custodian arising out of any violation of any investment or other limitation to which any Fund is subject, except to the extent that such loss, damage or expense: (i) relates to a violation of any investment or other limitation of a Fund occurring after receipt by the Custodian of a Contrary Notice; or (ii) arises from a breach of this Agreement by the Custodian. Section 3.04. Persons Having Access to Assets of the Funds. No Authorized Person, Trustee, officer, employee or agent of the Funds (other than the Custodian) shall have physical access to the assets of the Funds held by the Custodian, or shall be authorized or permitted to withdraw any such assets for delivery to an account of such person, nor shall the Custodian deliver any such assets to any such person; provided, however, that nothing in this Section 3.04 shall prohibit: (a) any Authorized Person from giving Proper Instructions, or the persons described in Section 3.01(b) from issuing Special Instructions, so long as such action does not result in delivery of or access to assets of the Funds prohibited by this Section 3.04; or (b) the Funds' independent certified public accountants from examining or reviewing the assets of the Funds held by the Custodian. Section 3.05. Actions of Custodian Based on Proper Instructions and Special Instructions. Subject to the provisions of Section 4.01 hereof, the Custodian shall not be responsible for the title, validity or genuineness of any property, or evidence of title thereof, received by it or delivered by it pursuant to this Agreement. ARTICLE IV - STANDARD OF CARE; INDEMNIFICATION Section 4.01. Standard of Care. (a) General Standard of Care. The Custodian shall exercise reasonable care and diligence in carrying out all of its duties and obligations under this Agreement, and shall be liable to the Funds for all loss, damage and expense incurred or suffered by the Funds, resulting from the failure of the Custodian to exercise such reasonable care and diligence or from any other breach by the Custodian of the terms of this Agreement. (b) Acts of God, Etc. In no event shall the Custodian incur liability hereunder if the Custodian is prevented, forbidden or delayed from performing, or omits to perform, any act or thing which this Agreement provides shall be performed or omitted to be performed by reason of: (i) any provision of any present or future law or regulation or order of the United States of America, or any state thereof, or of any foreign country, or political subdivision thereof or of any court of competent jurisdiction; or (ii) any act of God or war; unless, in each case, such delay or nonperformance is caused by (A) the negligence, misfeasance or misconduct of the Custodian, or (B) a malfunction or failure of equipment maintained or operated by the Custodian other than a malfunction or failure caused by events beyond the Custodian's control and which could not reasonably be anticipated and/or prevented by the Custodian. (c) Mitigation by Custodian. Upon the occurrence of any event which causes or may cause any loss, damage or expense to the Funds, the Custodian shall use all commercially reasonable efforts and shall take all reasonable steps under the circumstances to mitigate the effects of such event and to avoid continuing harm to the Funds. Section 4.02. Liability of Custodian for Actions of Securities Systems. Notwithstanding the provisions of Section4.01 to the contrary, the Custodian shall not be liable to the Funds for any loss, damage or expense resulting from the use by the Custodian of a Securities System, unless such loss, damage or expense is caused by, or results from, negligence, misfeasance or misconduct of the Custodian. In the case of loss, damage or expense resulting from use of a Securities System by the Custodian, the Custodian shall take all reasonable steps to enforce such rights as it may have against the Securities System to protect the interest of the Funds. Section 4.03. Indemnification. (a) Indemnification Obligations. Subject to the limitations set forth in this Agreement, the Funds severally agree to indemnify and hold harmless the Custodian from all claims and liabilities (including reasonable attorneys' fees) incurred or assessed against the Custodian for actions taken in reliance upon Proper Instructions or Special Instructions; provided, however, that such indemnity shall not apply to claims and liabilities occasioned by or resulting from the negligence, misfeasance or misconduct of the Custodian, or any other breach of this Agreement by the Custodian. In addition, the Funds severally agree to indemnify the Custodian against any liability incurred by the Custodian by reason of taxes assessed to the Custodian, or other costs, liability or expenses incurred by the Custodian, resulting directly or indirectly solely from the fact that securities and other property of the Funds is registered in the name of the Custodian; provided, however, in no event shall such indemnification be applicable to income, franchise or similar taxes which may be imposed or applied against the Custodian or charges imposed by a Federal Reserve Bank with respect to intra-day overdrafts unless separately agreed to by the Funds. (b) Extent of Liability. Notwithstanding anything to the contrary contained herein, with respect to the indemnification obligations of the Funds provided in this Section4.03, each Fund shall be: (i) severally, and not jointly and severally, liable with each of the other Funds; and (ii) liable only for its pro rata share of such liabilities, determined with reference to such Fund's proportionate interest in the aggregate of assets held by the Custodian in the Account with respect to which such liability relates at the time such liability was incurred, as reflected on the books and records of the Funds. (c) Notice of Litigation, Right to Prosecute, Etc. The Custodian shall promptly notify the Funds in writing of the commencement of any litigation or proceeding brought against the Custodian in respect of which indemnity may be sought against the Funds pursuant to this Section4.03. The Funds shall be entitled to participate in any such litigation or proceeding and, after written notice from the Funds to the Custodian, the Funds may assume the defense of such litigation or proceeding with counsel of their choice at their own expense. The Custodian shall not consent to the entry of any judgment or enter into any settlement in any such litigation or proceeding without providing the Funds with adequate notice of any such settlement or judgment, and without the Funds' prior written consent. The Custodian shall submit written evidence to the Funds with respect to any cost or expense for which it seeks indemnification in such form and detail as the Funds may reasonably request. Section 4.04. Funds, Right to Proceed. Notwithstanding anything to the contrary contained herein, the Funds shall have, at their election upon reasonable notice to the Custodian, the right to enforce, to the extent permitted by any applicable agreement and applicable law, the Custodian's rights against any Securities System or other person for loss, damage or expense caused the Custodian or the Funds by such Securities System or other person, and shall be entitled to enforce the rights of the Custodian with respect to.any claim against such Securities System or other person which the Custodian may have as a consequence of any such loss, damage or expense if and to the extent that the Custodian or any Fund has not been made whole for any such loss, damage or expense. ARTICLE V - COMPENSATION Section 5.01. Compensation. The Custodian shall be compensated for its services hereunder in an amount, and at such times, as may be agreed upon, from time to time, by the Custodian and the Funds. Each Fund shall be severally, and not jointly, liable with the other Funds only for its pro rata share of such compensation, determined with reference to such Fund's proportionate interest in each Repurchase Agreement transaction to which such compensation relates. Section 5.02. Waiver of Right of Set-Off. The Custodian hereby waives and relinquishes all contractual and common law rights of set-off to which it may now or hereafter be or become entitled with respect to any obligations of the Funds to the Custodian arising under this Agreement. ARTICLE VI - TERMINATION Section 6.01. Events of Termination. This Agreement shall continue in full force and effect until the first to occur of: (a) termination by the Custodian or the Funds by an instrument in writing delivered to the other party, such termination to take effect not sooner than ninety (90) days after the date of such delivery; or (b) termination by the Funds by written notice delivered to the Custodian, based upon the Funds' determination that there is a reasonable basis to conclude that the Custodian is insolvent or that the financial condition of the Custodian is deteriorating in any material respect, in which case termination shall take effect upon the Custodians receipt of such notice or at such later time as the Funds shall designate; provided, however, that this Agreement may be terminated as to one or more Funds (but less than all Funds) by delivery of an amended Schedule A-1, A-2, A-3 or A-4 pursuant to Section7.03 hereof. The execution and delivery of an amended Schedule A-1, A-2, A-3 or A-4 which deletes one or more Funds shall constitute a termination of this Agreement only with respect to such deleted Fund(s). Section 6.02. Successor Custodian; Payment of Compensation. Each of the Funds may identify a successor custodian to which the cash, Securities and other assets of such Fund shall, upon termination of this Agreement, be delivered; provided that in the case of the termination of this Agreement with respect to any of the Funds, such Fund or Funds shall direct the Custodian to transfer the assets of such Fund or Funds held by the Custodian pursuant to Proper Instructions. The Custodian agrees to cooperate with the Funds in the execution of documents and performance or all other actions necessary or desirable in order to substitute the successor custodian for the Custodian under this Agreement. In the event of termination, each Fund shall make payment of such Fund's applicable share of unpaid compensation within a reasonable time following termination and delivery of a statement to the Funds setting forth such fees. The termination of this Agreement with respect to any of the Funds shall be governed by the provisions of this ArticleVI as to notice, payments and delivery of securities and other assets, and shall not affect the obligations of the parties hereunder with respect to the other Funds set forth in Schedule A-1, A-2, A-3 or A-4 as amended from time to time. ARTICLE VII - MISCELLANEOUS Section 7.01. Representative Capacity and Binding Obligation. A COPY OF THE DECLARATION OF TRUST OR OTHER ORGANIZATIONAL DOCUMENTS OF EACH FUND IS ON FILE WITH THE SECRETARY OF THE STATE OF EACH FUND'S FORMATION, AND NOTICE IS HEREBY GIVEN THAT THIS AGREEMENT IS NOT EXECUTED ON BEHALF OF THE TRUSTEES OF ANY FUND AS INDIVIDUALS, AND THE OBLIGATIONS OF THIS AGREEMENT ARE NOT BINDING UPON ANY OF THE SHAREHOLDERS, TRUSTEES, DIRECTORS, PARTNERS, OFFICERS, EMPLOYEES OR AGENTS OF ANY FUND INDIVIDUALLY, BUT ARE BINDING ONLY UPON THE ASSETS AND PROPERTY OF THE FUNDS, AND IN THE CASE OF SERIES COMPANIES, SUCH FUNDS' RESPECTIVE PORTFOLIOS OR SERIES. THE CUSTODIAN AGREES THAT NO SHAREHOLDER, TRUSTEE, DIRECTOR, PARTNER, OFFICER, EMPLOYEE OR AGENT OF ANY FUND MAY BE HELD PERSONALLY LIABLE OR RESPONSIBLE FOR ANY OBLIGATIONS OF THE FUNDS ARISING OUT OF THIS AGREEMENT. WITH RESPECT TO OBLIGATIONS OF EACH FUND ARISING OUT OF THIS AGREEMENT, THE CUSTODIAN SHALL LOOK FOR PAYMENT OR SATISFACTION OF ANY CLAIM SOLELY TO THE ASSETS AND PROPERTY OF THE FUND TO WHICH SUCH OBLIGATION RELATES AS THOUGH EACH FUND HAD SEPARATELY CONTRACTED WITH THE CUSTODIAN BY SEPARATE WRITTEN INSTRUMENT." Section 7.02. Entire Agreement. This Agreement constitutes the entire understanding and agreement of the parties hereto with respect to the subject matter hereof. Section 7.03. Amendments. No provision of this Agreement may be amended except by a statement in writing signed by the party against which enforcement of the amendment is sought; provided, however, Schedule A-1, A-2, A-3 or A-4 listing the Funds which are parties hereto, Schedule B listing the Fund Custodians and Schedule C listing the Repo Custodians may be amended from time to time to add or delete one or more Funds, Fund Custodians or Repo Custodians, as the case may be, by the Funds' delivery of an amended Schedule A-1, A-2, A-3 or A-4, Schedule B or Schedule C to the Custodian. The deletion of one or more Funds from Schedule A-1, A-2, A-3 or A-4 shall have the effect of terminating this Agreement as to such Fund(s), but shall not affect this Agreement with respect to any other Fund. Section 7.04. Interpretation. In connection with the operation of this Agreement, the Custodian, and the Funds may agree in writing from time to time on such provisions interpretative of or in addition to the provisions of this Agreement as may in their joint opinion be consistent with the general tenor of this Agreement. No interpretative or additional provisions made as provided in the preceding sentence shall be deemed to be an amendment of this Agreement. Section 7.05. Captions. Headings contained in this Agreement, which are included as convenient references only, shall have no bearing upon the interpretation of the terms of the Agreement or the obligations of the parties hereto. Section 7.06. Governing Law. THE PROVISIONS OF THIS AGREEMENT SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO CONFLICT OF LAWS PRINCIPLES THEREOF. Section 7.07. Notice and Confirmations. (a) Except as provided in Section 7.07(b) below and except in the case of Proper Instructions or Special Instructions, notices and other writings contemplated by this Agreement shall be delivered by hand or by facsimile transmission (provided that in the case of delivery by facsimile transmission, notice shall also be mailed postage prepaid) to the parties at the following addresses: (i) If to the Funds: FMR Texas Inc. 400 East Las Colinas Blvd., CP9M Irving, Texas 75039 Telephone: (214) 584-7800 Attention: Ms. Deborah Todd or Mr. Samuel Silver (ii) If to the Custodian: The Bank of New York One Wall Street Fourth Floor New York, NY 10286 Attn: Claire Meskovic Telephone: (212) 635-4808 Telefax: (212) 635-4828 (b) The Custodian may provide the confirmations required by Sections 2.02 and 2.03 of this Agreement by making the information available in the form of a communication directly between electromechanical or electrical devices or systems (including, without limitation, computers) (or in such other manner as the parties hereto may agree in writing) to the following Fund Agent: Fidelity Accounting and Custody Domestic Securities Operations 400 East Las Colinas Blvd., CP9E Irving, Texas 75039 Telephone: (214) 506-4071 Attention: Mr. Mark Mufler The address and telephone number of the Funds, the Fund Agent and the Custodian and the identity of the Fund Agent specified in this Section 7.07 may be changed by written notice of the Funds to Custodian or Custodian to the Funds, as the case may be. All written notices which are required or provided to be given hereunder shall be effective upon actual receipt by the entity to which such notice is given. Section 7.08. Assignment. This Agreement shall be binding on and shall inure to the benefit of the parties hereto and their respective successors and assigns, provided that, no party hereto may assign this Agreement or any of its rights or obligations hereunder without the prior written consent of each of the other parties. Section 7.09. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original. This Agreement shall become effective when one or more counterparts have been signed and delivered by each of the parties. Section 7.10. Confidentiality; Survival of Obligations. The parties hereto agree that they shall each shall treat confidentially the terms and conditions of this Agreement and all information provided by each party to the others regarding its business and operations. All confidential information provided by a party hereto shall be used by any other party hereto solely for the purpose of rendering services pursuant to this Agreement and, except as may be required in carrying out this Agreement, shall not be disclosed to any third party without the prior consent of such providing party. The foregoing shall not be applicable to any information that is publicly available when provided or thereafter becomes publicly available other than through a breach of this Agreement, or that is required to be disclosed by any bank examiner of the Custodian, any auditor of the parties hereto or by judicial or administrative process or otherwise by applicable law or regulation. The provisions of this Section 7.10 and Sections3.03, 4.01, 4.02, 4.03, 4.04, 4.05, 7.01 and 7.06 shall survive any termination of this Agreement, provided that in the event of termination the Custodian agrees that it shall transfer and return Securities and other assets held by the Custodian for the benefit of the Funds as the Funds direct pursuant to Proper Instructions. IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed in its name and behalf on the day and year first above written. [Signature Lines Omitted] SCHEDULES A-1, A-2, A-3 AND A-4 TO JOINT TRADING ACCOUNT CUSTODY AGREEMENT BETWEEN THE BANK OF NEW YORK AND FIDELITY FUNDS DATED AS OF __________ The following is a list of the Funds to which this Agreement applies: SCHEDULE B TO JOINT TRADING ACCOUNT CUSTODY AGREEMENT BETWEEN THE BANK OF NEW YORK AND FIDELITY FUNDS DATED AS OF MAY 11, 1995 The following is a list of the Fund Custodians of the Funds: The Bank of New York Morgan Guaranty Trust Company Brown Brothers Harriman & Co. First Union National Bank Charlotte Chase Manhattan Bank, N.A. State Street Bank and Trust Company SCHEDULE C TO JOINT TRADING ACCOUNT CUSTODY AGREEMENT BETWEEN THE BANK OF NEW YORK AND FIDELITY FUNDS DATED AS OF MAY 11, 1995 The following is a list of Repo Custodians of the Funds: The Bank of New York Chemical Bank Morgan Guaranty Trust Company Exhibit 8(o) Form of FIRST AMENDMENT TO JOINT TRADING ACCOUNT CUSTODY AGREEMENT BETWEEN THE BANK OF NEW YORK AND FIDELITY FUNDS FIRST AMENDMENT TO JOINT TRADING ACCOUNT CUSTODY AGREEMENT BETWEEN THE BANK OF NEW YORK AND FIDELITY FUNDS, dated as of _______, by and between THE BANK OF NEW YORK ("Custodian") and each of the entities listed on SchedulesA-1, A-2, A-3 and A-4 hereto on behalf of itself or, (i) in the case of a series company, on behalf of one or more of its portfolios or series listed on SchedulesA-1 or A-2 hereto, (ii) in the case of the accounts listed on Schedule A-3 hereto, acting through Fidelity Management & Research Company, and (iii)in the case of the commingled or individual accounts listed on Schedule A-4 hereto, acting through Fidelity Management Trust Company (collectively, the "Funds" and each, a "Fund"). WITNESSETH WHEREAS, Custodian and certain of the Funds have entered into that certain Joint Trading Account Custody Agreement between The Bank of New York and Fidelity Funds, dated as of ______ (the "Agreement"), pursuant to which the Funds have appointed the Custodian as its custodian for the purpose of establishing and administering one or more joint trading accounts or subaccounts thereof (individually, an "Account" and collectively, the "Accounts") and holding cash and securities for the Funds in connection with repurchase transactions effected through the Accounts; and WHEREAS, Seller and the Funds desire to amend the Agreement as set forth below. NOW, THEREFORE, in consideration of the premises and mutual promises and covenants contained herein, the parties hereto agree as follows. Unless otherwise defined herein or the context otherwise requires, terms used in this Amendment, including the preamble and recitals, have the meanings provided in the Agreement. The Agreement is hereby amended by deleting Paragraph2.03(f) in its entirety and substituting the following in lieu thereof: Exhibit 8(o) "(f) Overdraft. In the event that the Custodian is directed by Proper Instructions to make any payment or transfer of funds on behalf of a Fund for which there would be, at the close of business on the date of such payment or transfer, insufficient funds held by the Custodian on behalf of such Fund, the Custodian may, in its discretion, provide an overdraft ("Overdraft") to the Fund (such Fund being referred to herein as an "Overdraft Fund"), in an amount sufficient to allow the completion of such payment or transfer. Any Overdraft provided hereunder: (a) shall be payable on the next Business Day, unless otherwise agreed by the Overdraft Fund and the Custodian; and (b) shall accrue interest from the date of the Overdraft to the date of payment in full by the Overdraft Fund at a rate agreed upon in writing, from time to time, by the Custodian and the Overdraft Fund. The Custodian and the Funds acknowledge that the purpose of such Overdrafts is to temporarily finance the purchase or sale of securities for prompt delivery in accordance with the terms hereof. The Custodian hereby agrees to notify each Overdraft Fund by 3:00 p.m., New York time, of the amount of any Overdraft. Provided that Custodian has given the notice required by this subparagraph (f), the Funds hereby agree that, as security for the Overdraft of an Overdraft Fund, the Custodian shall have a continuing lien and security interest in and to all interest of such Overdraft Fund in Securities whose purchase is financed by Custodian and which are in Custodian's possession or in the possession or control of any third party acting on Custodian's behalf and the proceeds thereof. In this regard, Custodian shall be entitled to all the rights and remedies of a pledgee under common law and a secured party under the New York Uniform Commercial Code and any other applicable laws or regulations as then in effect." IN WITNESS WHEREOF, the undersigned have caused this Amendment to be executed and delivered under seal by their duly authorized officers. BANK OF NEW YORK By: /s/ Name: Kurt D. Woetzel Title: Senior Vice President FIDELITY INVESTMENT COMPANIES LISTED ON SCHEDULE A-1 HERETO AND ACCOUNTS LISTED ON SCHEDULE A-3 HERETO Dated: By: /s/ Name: Kenneth A. Rathgeber Title: Treasurer of the Fidelity Investment Companies listed on ScheduleA-1 and Vice President of Fidelity Management& Research Company FIDELITY INVESTMENT COMPANIES LISTED ON SCHEDULE A-2 HERETO Dated: By: /s/ Name: David J. Saul Title: Director of the Fidelity International (Bermuda) Funds Limited, on behalf of the Funds listed on Schedule A-2 ACCOUNTS LISTED ON SCHEDULE A-4 HERETO By: FIDELITY MANAGEMENT TRUST COMPANY Dated: By: /s/ Name: John P. O'Reilly, Jr. Title: Executive Vice President EX-99.B8 15 Exhibit 8(p) Form of CUSTODIAN AGREEMENT Between Each of the Investment Companies Listed on Appendix "A" Attached Hereto and Brown Brothers Harriman & Company TABLE OF CONTENTS ARTICLE Page I. APPOINTMENT OF CUSTODIAN 1 II. POWERS AND DUTIES OF CUSTODIAN 1 2.01 Safekeeping 1 2.02 Manner of Holding Securities 1 2.03 Security Purchases 2 2.04 Exchanges of Securities 2 2.05 Sales of Securities 3 2.06 Depositary Receipts 3 2.07 Exercise of Rights; Tender Offers 3 2.08 Stock Dividends, Rights, Etc. 3 2.09 Options 4 2.10 Futures Contracts 4 2.11 Borrowing 4 2.12 Interest Bearing Deposits 5 2.13 Foreign Exchange Transactions 5 2.14 Securities Loans 5 2.15 Collections 6 2.16 Dividends, Distributions and Redemptions 6 2.17 Proceeds from Shares Sold 6 2.18 Proxies, Notices, Etc. 6 2.19 Bills and Other Disbursements 7 2.20 Nondiscretionary Functions 7 2.21 Bank Accounts 7 2.22 Deposit of Fund Assets in Securities Systems 7 2.23 Other Transfers 8 2.24 Establishment of Segregated Account 9 2.25 Custodian's Books and Records . 9 2.26 Opinion of Fund's Independent Certified Public Accountants 9 2.27 Reports of Independent Certified Public Accountants 10 2.28 Overdraft Facility 10 III. PROPER INSTRUCTIONS, SPECIAL INSTRUCTIONS AND RELATED MATTERS 10 3.01 Proper Instructions and Special Instructions 10 3.02 Authorized Persons 11 3.03 Persons Having Access to Assets of the Portfolios 11 3.04 Actions of the Custodian Based on Proper Instructions and Special Instructions 11 i IV. SUBCUSTODIANS 11 4.01 Domestic Subcustodians 12 4.02 Foreign Subcustodians and Interim Subcustodians 12 4.03 Special Subcustodians 13 4.04 Termination of a Subcustodian 13 4.05 Certification Regarding Foreign Subcustodians 13 V. STANDARD OF CARE; INDEMNIFICATION 14 5.01 Standard of Care 14 5.02 Liability of Custodian for Actions of Other Persons 15 5.03 Indemnification 15 5.04 Investment Limitations 16 5.05 Fund's Right to Proceed 16 VI. COMPENSATION 17 VII. TERMINATION 17 7.01 Termination of Agreement as to One or More Funds 17 7.02 Termination as to One or More Portfolios 18 VIII. DEFINED TERMS 18 IX. MISCELLANEOUS 19 9.01 Execution of Documents, Etc 19 9.02 Representative Capacity; Nonrecourse Obligations 19 9.03 Several Obligations of the Funds and the Portfolios 19 9.04 Representations and Warranties 19 9.05 Entire Agreement 20 9.06 Waivers and Amendments 20 9.07 Interpretation 20 9.08 Captions 20 9.09 Governing Law 20 9.10 Notices 21 IX. MISCELLANEOUS 21 9.11 Assignment 21 9.12 Counterparts 21 9.13 Confidentiality; Survival of Obligations 21 ii APPENDICES Appendix "A" - List of Funds and Portfolios Appendix "B" - List of Additional Custodians, Special Subcustodians and Foreign Subcustodians Appendix "C" - Procedures Relating to Custodian's Security Interest Exhibit 8(p) FORM OF CUSTODIAN AGREEMENT AGREEMENT made as of the of between each of the Investment Companies Listed on Appendix "A" hereto, as the same may be amended from time to time (each a "Fund" and collectively the "Funds") and Brown Brothers Harriman & Company (the "Custodian"). W I T N E S S E T H WHEREAS, each Fund is or may be organized with one or more series of shares, each of which shall represent an interest in a separate portfolio of cash, securities and other assets (all such existing and additional series now or hereafter listed on Appendix "A" being hereinafter referred to individually, as a "Portfolio," and collectively, as the "Portfolios"); and WHEREAS, each Fund desires to appoint the Custodian as custodian on behalf of each of its Portfolios in accordance with the provisions of the Investment Company Act of 1940, as amended (the "1940 Act"), and the rules and regulations thereunder, under the terms and conditions set forth in this Agreement, and the Custodian has agreed so to act as custodian. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties hereto agree as follows: ARTICLE I APPOINTMENT OF CUSTODIAN On behalf of each of its Portfolios, each Fund hereby employs and appoints the Custodian as a custodian, subject to the terms and provisions of this Agreement. Each Fund shall deliver to the Custodian, or shall cause to be delivered to the Custodian, cash, securities and other assets owned by each of its Portfolios from time to time during the term of this Agreement and shall specify to which of its Portfolios such cash, securities and other assets are to be specifically allocated. ARTICLE II POWERS AND DUTIES OF CUSTODIAN As custodian, the Custodian shall have and perform the powers and duties set forth in this Article II. Pursuant to and in accordance with Article IV hereof, the Custodian may appoint one or more Subcustodians (as hereinafter defined) to exercise the powers and perform the duties of the Custodian set forth in this Article II and references to the Custodian in this Article II shall include any Subcustodian so appointed. Section 2.01. Safekeeping. The Custodian shall keep safely all cash, securities and other assets of each Fund's Portfolios delivered to the Custodian and, on behalf of such Portfolios, the Custodian shall, from time to time, accept delivery of cash, securities and other assets for safekeeping. Section 2.02. Manner of Holding Securities. (a) The Custodian shall at all times hold securities of each Fund's Portfolios either: (i) by physical possession of the share certificates or other instruments representing such securities in registered or bearer form; or (ii) in book-entry form by a Securities System (as hereinafter defined) in accordance with the provisions of Section 2.22 below. (b) The Custodian shall at all times hold registered securities of each Portfolio in the name of the Custodian, the Portfolio or a nominee of either of them, unless specifically directed by Proper Instructions to hold such registered securities in so-called street name; provided that, in any event, all such securities and other assets shall be held in an account of the Custodian containing only assets of a Portfolio, or only assets held by the Custodian as a fiduciary or custodian for customers; and provided further, that the records of the Custodian shall indicate at all times the Portfolio or other customer for which such securities and other assets are held in such account and the respective interests therein. Section 2.03. Security Purchases. Upon receipt of Proper Instructions (as hereinafter defined), the Custodian shall pay for and receive securities purchased for the account of a Portfolio, provided that payment shall be made by the Custodian only upon receipt of the securities: (a) by the Custodian; (b) by a clearing corporation of a national securities exchange of which the Custodian is a member; or (c) by a Securities System. Notwithstanding the foregoing, upon receipt of Proper Instructions: (i) in the case of a repurchase agreement, the Custodian may release funds to a Securities System prior to the receipt of advice from the Securities System that the securities underlying such repurchase agreement have been transferred by book-entry into the Account (as hereinafter defined) maintained with such Securities System by the Custodian, provided that the Custodian's instructions to the Securities System require that the Securities System may make payment of such funds to the other party to the repurchase agreement only upon transfer by book-entry of the securities underlying the repurchase agreement into the Account; (ii) in the case of time deposits, call account deposits, currency deposits, and other deposits, foreign exchange transactions, futures contracts or options, pursuant to Sections 2.09, 2.10, 2.12 and 2.13 hereof, the Custodian may make payment therefor before receipt of an advice or confirmation evidencing said deposit or entry into such transaction; (iii) in the case of the purchase of securities, the settlement of which occurs outside of the United States of America, the Custodian may make payment therefor and receive delivery of such securities in accordance with local custom and practice generally accepted by Institutional Clients (as hereinafter defined) in the country in which the settlement occurs, but in all events subject to the standard of care set forth in Article V hereof; and (iv) in the case of the purchase of securities in which, in accordance with standard industry custom and practice generally accepted by Institutional Clients with respect to such securities, the receipt of such securities and the payment therefor take place in different countries, the Custodian may receive delivery of such securities and make payment therefor in accordance with standard industry custom and practice for such securities generally accepted by Institutional Clients, but in all events subject to the standard of care set forth in Article V hereof. For purposes of this Agreement, an "Institutional Client" shall mean a major commercial bank, corporation, insurance company, or substantially similar institution, which, as a substantial part of its business operations, purchases or sells securities and makes use of custodial services. Section 2.04. Exchanges of Securities. Upon receipt of Proper Instructions, the Custodian shall exchange securities held by it for the account of a Portfolio for other securities in connection with any reorganization, recapitalization, split-up of shares, change of par value, conversion or other event relating to the securities or the issuer of such securities, and shall deposit any such securities in accordance with the terms of any reorganization or protective plan. The Custodian shall, without receiving Proper Instructions: surrender securities in temporary form for definitive securities; surrender securities for transfer into the name of the Custodian, a Portfolio or a nominee of either of them, as permitted by Section 2.02(b); and surrender securities for a different number of certificates or instruments representing the same number of shares or same principal amount of indebtedness, provided that the securities to be issued will be delivered to the Custodian or a nominee of the Custodian. Section 2.05. Sales of Securities. Upon receipt of Proper Instructions, the Custodian shall make delivery of securities which have been sold for the account of a Portfolio, but only against payment therefor in the form of: (a) cash, certified check, bank cashier's check, bank credit, or bank wire transfer; (b) credit to the account of the Custodian with a clearing corporation of a national securities exchange of which the Custodian is a member; or (c) credit to the Account of the Custodian with a Securities System, in accordance with the provisions of Section 2.22 hereof. Notwithstanding the foregoing: (i) in the case of the sale of securities, the settlement of which occurs outside of the United States of America, such securities shall be delivered and paid for in accordance with local custom and practice generally accepted by Institutional Clients in the country in which the settlement occurs, but in all events subject to the standard of care set forth in Article V hereof; (ii) in the case of the sale of securities in which, in accordance with standard industry custom and practice generally accepted by Institutional Clients with respect to such securities, the delivery of such securities and receipt of payment therefor take place in different countries, the Custodian may deliver such securities and receive payment therefor in accordance with standard industry custom and practice for such securities generally accepted by Institutional Clients, but in all events subject to the standard of care set forth in Article V hereof; and (iii) in the case of securities held in physical form, such securities shall be delivered and paid for in accordance with "street delivery custom" to a broker or its clearing agent, against delivery to the Custodian of a receipt for such securities, provided that the Custodian shall have taken reasonable steps to ensure prompt collection of the payment for, or the return of, such securities by the broker or its clearing agent, and provided further that the Custodian shall not be responsible for the selection of or the failure or inability to perform of such broker or its clearing agent. Section 2.06. Depositary Receipts. Upon receipt of Proper Instructions, the Custodian shall surrender securities to the depositary used for such securities by an issuer of American Depositary Receipts or International Depositary Receipts (hereinafter referred to, collectively, as "ADRs"), against a written receipt therefor adequately describing such securities and written evidence satisfactory to the Custodian that the depositary has acknowledged receipt of instructions to issue ADRs with respect to such securities in the name of the Custodian or a nominee of the Custodian, for delivery to the Custodian at such place as the Custodian may from time to time designate. Upon receipt of Proper Instructions, the Custodian shall surrender ADRs to the issuer thereof, against a written receipt therefor adequately describing the ADRs surrendered and written evidence satisfactory to the Custodian that the issuer of the ADRs has acknowledged receipt of instructions to cause its depository to deliver the securities underlying such ADRs to the Custodian. Section 2.07. Exercise of Rights; Tender Offers. Upon receipt of Proper Instructions, the Custodian shall: (a) deliver warrants, puts, calls, rights or similar securities to the issuer or trustee thereof, or to the agent of such issuer or trustee, for the purpose of exercise or sale, provided that the new securities, cash or other assets, if any, acquired as a result of such actions are to be delivered to the Custodian; and (b) deposit securities upon invitations for tenders thereof, provided that the consideration for such securities is to be paid or delivered to the Custodian, or the tendered securities are to be returned to the Custodian. Notwithstanding any provision of this Agreement to the contrary, the Custodian shall take all necessary action, unless otherwise directed to the contrary in Proper Instructions, to comply with the terms of all mandatory or compulsory exchanges, calls, tenders, redemptions, or similar rights of security ownership, and shall promptly notify each applicable Fund of such action in writing by facsimile transmission or in such other manner as such Fund and the Custodian may agree in writing. Section 2.08. Stock Dividends, Rights, Etc. The Custodian shall receive and collect all stock dividends, rights and other items of like nature and, upon receipt of Proper Instructions, take action with respect to the same as directed in such Proper Instructions. Section 2.09. Options. Upon receipt of Proper Instructions and in accordance with the provisions of any agreement between the Custodian, any registered broker-dealer and, if necessary, a Fund on behalf of any applicable Portfolio relating to compliance with the rules of the Options Clearing Corporation or of any registered national securities exchange or similar organization(s), the Custodian shall: (a) receive and retain confirmations or other documents, if any, evidencing the purchase or writing of an option on a security or securities index by the applicable Portfolio; (b) deposit and maintain in a segregated account, securities (either physically or by book-entry in a Securities System), cash or other assets; and (c) pay, release and/or transfer such securities, cash or other assets in accordance with notices or other communications evidencing the expiration, termination or exercise of such options furnished by the Options Clearing Corporation, the securities or options exchange on which such options are traded, or such other organization as may be responsible for handling such option transactions. Each Fund, on behalf of its applicable Portfolios, and the broker-dealer shall be responsible for the sufficiency of assets held in any segregated account established in compliance with applicable margin maintenance requirements and the performance of other terms of any option contract. Section 2.10. Futures Contracts. Upon receipt of Proper Instructions, or pursuant to the provisions of any futures margin procedural agreement among a Fund, on behalf of any applicable Portfolio, the Custodian and any futures commission merchant (a "Procedural Agreement"), the Custodian shall: (a) receive and retain confirmations, if any, evidencing the purchase or sale of a futures contract or an option on a futures contract by the applicable Portfolio; (b) deposit and maintain in a segregated account, cash, securities and other assets designated as initial, maintenance or variation "margin" deposits intended to secure the applicable Portfolio's performance of its obligations under any futures contracts purchased or sold or any options on futures contracts written by the Portfolio, in accordance with the provisions of any Procedural Agreement designed to comply with the rules of the Commodity Futures Trading Commission and/or any commodity exchange or contract market (such as the Chicago Board of Trade), or any similar organization(s), regarding such margin deposits; and (c) release assets from and/or transfer assets into such margin accounts only in accordance with any such Procedural Agreements. Each Fund, on behalf of its applicable Portfolios, and such futures commission merchant shall be responsible for the sufficiency of assets held in the segregated account in compliance with applicable margin maintenance requirements and the performance of any futures contract or option on a futures contract in accordance with its terms. Section 2.11. Borrowing. Upon receipt of Proper Instructions, the Custodian shall deliver securities of a Portfolio to lenders or their agents, or otherwise establish a segregated account as agreed to by the applicable Fund on behalf of such Portfolio and the Custodian, as collateral for borrowings effected by such Portfolio, provided that such borrowed money is payable by the lender (a) to or upon the Custodian's order, as Custodian for such Portfolio, and (b) concurrently with delivery of such securities. Section 2.12. Interest Bearing Deposits. Upon receipt of Proper Instructions directing the Custodian to purchase interest bearing fixed term and call deposits (hereinafter referred to collectively, as "Interest Bearing Deposits") for the account of a Portfolio, the Custodian shall purchase such Interest Bearing Deposits in the name of the Portfolio with such banks or trust companies (including the Custodian, any Subcustodian or any subsidiary or affiliate of the Custodian) (hereinafter referred to as "Banking Institutions") and in such amounts as the applicable Fund may direct pursuant to Proper Instructions. Such Interest Bearing Deposits may be denominated in U.S. Dollars or other currencies, as the applicable Fund on behalf of its Portfolio may determine and direct pursuant to Proper Instructions. The Custodian shall include in its records with respect to the assets of each Portfolio appropriate notation as to the amount and currency of each such Interest Bearing Bank Deposit, the accepting Banking Institution and all other appropriate details, and shall retain such forms of advice or receipt evidencing such account, if any, as may be forwarded to the Custodian by the Banking Institution. The responsibilities of the Custodian to each Fund for Interest Bearing Deposits accepted on the Custodian's books in the United States on behalf of the Fund's Portfolios shall be that of a U.S. bank for a similar deposit. With respect to Interest Bearing Deposits other than those accepted on the Custodian's books, (a) the Custodian shall be responsible for the collection of income as set forth in Section 2.15 and the transmission of cash and instructions to and from such accounts; and (b) the Custodian shall have no duty with respect to the selection of the Banking Institution or, so long as the Custodian acts in accordance with Proper Instructions, for the failure of such Banking Institution to pay upon demand. Upon receipt of Proper Instructions, the Custodian shall take such reasonable actions as the applicable Fund deems necessary or appropriate to cause each such Interest Bearing Deposit Account to be insured to the maximum extent possible by all applicable deposit insurers including, without limitation, the Federal Deposit Insurance Corporation. Section 2.13. Foreign Exchange Transactions (a) Foreign Exchange Transactions Other Than as Principal. Upon receipt of Proper Instructions, the Custodian shall settle foreign exchange contracts or options to purchase and sell foreign currencies for spot and future delivery on behalf of and for the account of a Portfolio with such currency brokers or Banking Institutions as the applicable Fund may determine and direct pursuant to Proper Instructions. The Custodian shall be responsible for the transmission of cash and instructions to and from the currency broker or Banking Institution with which the contract or option is made, the safekeeping of all certificates and other documents and agreements evidencing or relating to such foreign exchange transactions and the maintenance of proper records as set forth in Section 2.25. The Custodian shall have no duty with respect to the selection of the currency brokers or Banking Institutions with which a Fund deals on behalf of its Portfolios or, so long as the Custodian acts in accordance with Proper Instructions, for the failure of such brokers or Banking Institutions to comply with the terms of any contract or option. (b) Foreign Exchange Contracts as Principal. The Custodian shall not be obligated to enter into foreign exchange transactions as principal. However, if the Custodian has made available to a Fund its services as a principal in foreign exchange transactions, upon receipt of Proper Instructions, the Custodian shall enter into foreign exchange contracts or options to purchase and sell foreign currencies for spot and future delivery on behalf of and for the account of a Portfolio of such Fund with the Custodian as principal. The Custodian shall be responsible for the selection of the currency brokers or Banking Institutions and the failure of such currency brokers or Banking Institutions to comply with the terms of any contract or option. (c) Payments. Notwithstanding anything to the contrary contained herein, upon receipt of Proper Instructions the Custodian may, in connection with a foreign exchange contract, make free outgoing payments of cash in the form of U.S. Dollars or foreign currency prior to receipt of confirmation of such foreign exchange contract or confirmation that the countervalue currency completing such contract has been delivered or received. Section 2.14. Securities Loans. Upon receipt of Proper Instructions, the Custodian shall, in connection with loans of securities by a Portfolio, deliver securities of such Portfolio to the borrower thereof prior to receipt of the collateral, if any, for such borrowing; provided that, in cases of loans of securities secured by cash collateral, the Custodian's instructions to the Securities System shall require that the Securities System deliver the securities of the Portfolio to the borrower thereof only upon receipt of the collateral for such borrowing. Section 2.15. Collections. The Custodian shall, and shall cause any Subcustodian to: (a) collect amounts due and payable to each Fund with respect to portfolio securities and other assets of each of such Fund's Portfolios; (b) promptly credit to the account of each applicable Portfolio all income and other payments relating to portfolio securities and other assets held by the Custodian hereunder upon Custodian's receipt of such income or payments or as otherwise agreed in writing by the Custodian and the applicable Fund; (c) promptly endorse and deliver any instruments required to effect such collections; (d) promptly execute ownership and other certificates and affidavits for all federal, state and foreign tax purposes in connection with receipt of income, capital gains or other payments with respect to portfolio securities and other assets of each applicable Portfolio, or in connection with the purchase, sale or transfer of such securities or other assets; and (e) promptly file any certificates or other affidavits for the refund or reclaim of foreign taxes paid, and promptly notify each applicable Fund of any changes to law, interpretative rulings or procedures regarding such reclaims, and otherwise use all available measures customarily used to minimize the imposition of foreign taxes at source, and promptly inform each applicable Fund of alternative means of minimizing such taxes of which the Custodian shall become aware (or with the exercise of reasonable care should have become aware); provided, however, that with respect to portfolio securities registered in so-called street name, the Custodian shall use its best efforts to collect amounts due and payable to each Fund with respect to its Portfolios. The Custodian shall promptly notify each applicable Fund in writing by facsimile transmission or in such other manner as each such Fund and the Custodian may agree in writing if any amount payable with respect to portfolio securities or other assets of the Portfolios of such Fund(s) is not received by the Custodian when due. The Custodian shall not be responsible for the collection of amounts due and payable with respect to portfolio securities or other assets that are in default. Section 2.16. Dividends, Distributions and Redemptions. The Custodian shall promptly release funds or securities: (a) upon receipt of Proper Instructions, to one or more Distribution Accounts designated by the applicable Fund or Funds in such Proper Instructions; or (b) upon receipt of Special Instructions, as otherwise directed by the applicable Fund or Funds, for the purpose of the payment of dividends or other distributions to shareholders of each applicable Portfolio, and payment to shareholders who have requested repurchase or redemption of their shares of the Portfolio(s) (collectively, the "Shares"). For purposes of this Agreement, a "Distribution Account" shall mean an account established at a Banking Institution designated by the applicable Fund on behalf of one or more of its Portfolios in Special Instructions. Section 2.17. Proceeds from Shares Sold. The Custodian shall receive funds representing cash payments received for Shares issued or sold from time to time by the Funds, and shall promptly credit such funds to the account(s) of the applicable Portfolio(s). The Custodian shall promptly notify each applicable Fund of Custodian's receipt of cash in payment for Shares issued by such Fund by facsimile transmission or in such other manner as the Fund and Custodian may agree in writing. Upon receipt of Proper Instructions, the Custodian shall: (a) deliver all federal funds received by the Custodian in payment for Shares in payment for such investments as may be set forth in such Proper Instructions and at a time agreed upon between the Custodian and the applicable Fund; and (b) make federal funds available to the applicable Fund as of specified times agreed upon from time to time by the applicable Fund and the Custodian, in the amount of checks received in payment for Shares which are deposited to the accounts of each applicable Portfolio. Section 2.18. Proxies, Notices, Etc. The Custodian shall deliver to each applicable Fund, in the most expeditious manner practicable, all forms of proxies, all notices of meetings, and any other notices or announcements affecting or relating to securities owned by one or more of the applicable Fund's Portfolios that are received by the Custodian, any Subcustodian, or any nominee of either of them, and, upon receipt of Proper Instructions, the Custodian shall execute and deliver, or cause such Subcustodian or nominee to execute and deliver, such proxies or other authorizations as may be required. Except as directed pursuant to Proper Instructions, neither the Custodian nor any Subcustodian or nominee shall vote upon any such securities, or execute any proxy to vote thereon, or give any consent or take any other action with respect thereto. Section 2.19. Bills and Other Disbursements. Upon receipt of Proper Instructions, the Custodian shall pay or cause to be paid, all bills, statements, or other obligations of each Portfolio. Section 2.20. Nondiscretionary Functions. The Custodian shall attend to all nondiscretionary details in connection with the sale, exchange, substitution, purchase, transfer or other dealings with securities or other assets of each Portfolio held by the Custodian, except as otherwise directed from time to time pursuant to Proper Instructions. Section 2.21. Bank Accounts (a) Accounts with the Custodian and any Subcustodians. The Custodian shall open and operate a bank account or accounts (hereinafter referred to collectively, as "Bank Accounts") on the books of the Custodian or any Subcustodian provided that such account(s) shall be in the name of the Custodian or a nominee of the Custodian, for the account of a Portfolio, and shall be subject only to the draft or order of the Custodian; provided however, that such Bank Accounts in countries other than the United States may be held in an account of the Custodian containing only assets held by the Custodian as a fiduciary or custodian for customers, and provided further, that the records of the Custodian shall indicate at all times the Portfolio or other customer for which such securities and other assets are held in such account and the respective interests therein. Such Bank Accounts may be denominated in either U.S. Dollars or other currencies. The responsibilities of the Custodian to each applicable Fund for deposits accepted on the Custodian's books in the United States shall be that of a U.S. bank for a similar deposit. The responsibilities of the Custodian to each applicable Fund for deposits accepted on any Subcustodian's books shall be governed by the provisions of Section 5.02. (b) Accounts With Other Banking Institutions. The Custodian may open and operate Bank Accounts on behalf of a Portfolio, in the name of the Custodian or a nominee of the Custodian, at a Banking Institution other than the Custodian or any Subcustodian, provided that such account(s) shall be in the name of the Custodian or a nominee of the Custodian, for the account of a Portfolio, and shall be subject only to the draft or order of the Custodian; provided however, that such Bank Accounts may be held in an account of the Custodian containing only assets held by the Custodian as a fiduciary or custodian for customers, and provided further, that the records of the Custodian shall indicate at all times the Portfolio or other customer for which such securities and other assets are held in such account and the respective interests therein. Such Bank Accounts may be denominated in either U.S. Dollars or other currencies. Subject to the provisions of Section 5.01(a), the Custodian shall be responsible for the selection of the Banking Institution and for the failure of such Banking Institution to pay according to the terms of the deposit. (c) Deposit Insurance. Upon receipt of Proper Instructions, the Custodian shall take such reasonable actions as the applicable Fund deems necessary or appropriate to cause each deposit account established by the Custodian pursuant to this Section 2.21 to be insured to the maximum extent possible by all applicable deposit insurers including, without limitation, the Federal Deposit Insurance Corporation. Section 2.22. Deposit of Fund Assets in Securities Systems. The Custodian may deposit and/or maintain domestic securities owned by a Portfolio in: (a) The Depository Trust Company; (b) the Participants Trust Company; (c) any book-entry system as provided in (i) Subpart O of Treasury Circular No. 300, 31 CFR 306.115, (ii) Subpart B of Treasury Circular Public Debt Series No. 27-76, 31 CFR 350.2, or (iii) the book-entry regulations of federal agencies substantially in the form of 31 CFR 306.115; or (d) any other domestic clearing agency registered with the Securities and Exchange Commission ("SEC") under Section 17A of the Securities Exchange Act of 1934 (or as may otherwise be authorized by the Securities and Exchange Commission to serve in the capacity of depository or clearing agent for the securities or other assets of investment companies) which acts as a securities depository and the use of which each applicable Fund has previously approved by Special Instructions (as hereinafter defined) (each of the foregoing being referred to in this Agreement as a "Securities System"). Use of a Securities System shall be in accordance with applicable Federal Reserve Board and SEC rules and regulations, if any, and subject to the following provisions: (A) The Custodian may deposit and/or maintain securities held hereunder in a Securities System, provided that such securities are represented in an account ("Account") of the Custodian in the Securities System which Account shall not contain any assets of the Custodian other than assets held as a fiduciary, custodian, or otherwise for customers and shall be so designated on the books and records of the Securities System. (B) The Securities System shall be obligated to comply with the Custodian's directions with respect to the securities held in such Account and shall not be entitled to a lien against the assets in such Account for extensions of credit to the Custodian other than for payment of the purchase price of such assets. (C) Each Fund hereby designates the Custodian as the party in whose name any securities deposited by the Custodian in the Account are to be registered. (D) The books and records of the Custodian shall at all times identify those securities belonging to each Portfolio which are maintained in a Securities System. (E) The Custodian shall pay for securities purchased for the account of a Portfolio only upon (w) receipt of advice from the Securities System that such securities have been transferred to the Account of the Custodian, and (x) the making of an entry on the records of the Custodian to reflect such payment and transfer for the account of such Portfolio. The Custodian shall transfer securities sold for the account of a Portfolio only upon (y) receipt of advice from the Securities System that payment for such securities has been transferred to the Account of the Custodian, and (z) the making of an entry on the records of the Custodian to reflect such transfer and payment for the account of such Portfolio. Copies of all advices from the Securities System relating to transfers of securities for the account of a Portfolio shall identify such Portfolio and shall be maintained for such Portfolio by the Custodian. The Custodian shall deliver to each applicable Fund on the next succeeding business day daily transaction reports which shall include each day's transactions in the Securities System for the account of each applicable Portfolio. Such transaction reports shall be delivered to each applicable Fund or any agent designated by such Fund pursuant to Proper Instructions, by computer or in such other manner as such Fund and the Custodian may agree in writing. (F) The Custodian shall, if requested by a Fund pursuant to Proper Instructions, provide such Fund with all reports obtained by the Custodian or any Subcustodian with respect to a Securities System's accounting system, internal accounting control and procedures for safeguarding securities deposited in the Securities System. (G) Upon receipt of Special Instructions, the Custodian shall terminate the use of any Securities System (except the federal book-entry system) on behalf of any Portfolio as promptly as practicable and shall take all actions reasonably practicable to safeguard the securities of any Portfolio maintained with such Securities System. Section 2.23. Other Transfers. (a) Upon receipt of Proper Instructions, the Custodian shall transfer to or receive from a third party that has been appointed to serve as an additional custodian of one or more Portfolios (an "Additional Custodian") securities, cash and other assets of such Portfolio(s) in accordance with such Proper Instructions. Each Additional Custodian shall be identified as such on Appendix B, as the same may be amended from time to time in accordance with the provisions of Section 9.06(c). (b) Upon receipt of Special Instructions, the Custodian shall make such other dispositions of securities, funds or other property of a Portfolio in a manner or for purposes other than as expressly set forth in this Agreement, provided that the Special Instructions relating to such disposition shall include a statement of the purpose for which the delivery is to be made, the amount of funds and/or securities to be delivered, and the name of the person or persons to whom delivery is to be made, and shall otherwise comply with the provisions of Sections 3.01 and 3.03 hereof. Section 2.24. Establishment of Segregated Account. Upon receipt of Proper Instructions, the Custodian shall establish and maintain on its books a segregated account or accounts for and on behalf of a Portfolio, into which account or accounts may be transferred cash and/or securities or other assets of such Portfolio, including securities maintained by the Custodian in a Securities System pursuant to Section 2.22 hereof, said account or accounts to be maintained: (a) for the purposes set forth in Sections 2.09, 2.10 and 2.11 hereof; (b) for the purposes of compliance by the Portfolio with the procedures required by Investment Company Act Release No. 10666, or any subsequent release or releases of the SEC relating to the maintenance of segregated accounts by registered investment companies; or (c) for such other purposes as set forth, from time to time, in Special Instructions. Section 2.25. Custodian's Books and Records. The Custodian shall provide any assistance reasonably requested by a Fund in the preparation of reports to such Fund's shareholders and others, audits of accounts, and other ministerial matters of like nature. The Custodian shall maintain complete and accurate records with respect to securities and other assets held for the accounts of each Portfolio as required by the rules and regulations of the SEC applicable to investment companies registered under the 1940 Act, including: (a) journals or other records of original entry containing a detailed and itemized daily record of all receipts and deliveries of securities (including certificate and transaction identification numbers, if any), and all receipts and disbursements of cash; (b) ledgers or other records reflecting (i) securities in transfer, (ii) securities in physical possession, (iii) securities borrowed, loaned or collateralizing obligations of each Portfolio, (iv) monies borrowed and monies loaned (together with a record of the collateral therefor and substitutions of such collateral), (v) dividends and interest received, (vi) the amount of tax withheld by any person in respect of any collection made by the Custodian or any Subcustodian, and (vii) the amount of reclaims or refunds for foreign taxes paid; and (c) cancelled checks and bank records related thereto. The Custodian shall keep such other books and records of each Fund as such Fund shall reasonably request. All such books and records maintained by the Custodian shall be maintained in a form acceptable to the applicable Fund and in compliance with the rules and regulations of the SEC, including, but not limited to, books and records required to be maintained by Section 31(a) of the 1940 Act and the rules and regulations from time to time adopted thereunder. All books and records maintained by the Custodian pursuant to this Agreement shall at all times be the property of each applicable Fund and shall be available during normal business hours for inspection and use by such Fund and its agents, including, without limitation, its independent certified public accountants. Notwithstanding the preceding sentence, no Fund shall take any actions or cause the Custodian to take any actions which would cause, either directly or indirectly, the Custodian to violate any applicable laws, regulations or orders. Section 2.26. Opinion of Fund's Independent Certified Public Accountants. The Custodian shall take all reasonable action as a Fund may request to obtain from year to year favorable opinions from such Fund's independent certified public accountants with respect to the Custodian's activities hereunder in connection with the preparation of the Fund's Form N-1A and the Fund's Form N-SAR or other periodic reports to the SEC and with respect to any other requirements of the SEC. Section 2.27. Reports by Independent Certified Public Accountants. At the request of a Fund, the Custodian shall deliver to such Fund a written report prepared by the Custodian's independent certified public accountants with respect to the services provided by the Custodian under this Agreement, including, without limitation, the Custodian's accounting system, internal accounting control and procedures for safeguarding cash, securities and other assets, including cash, securities and other assets deposited and/or maintained in a Securities System or with a Subcustodian. Such report shall be of sufficient scope and in sufficient detail as may reasonably be required by any Fund and as may reasonably be obtained by the Custodian. Section 2.28. Overdraft Facility. In the event that the Custodian is directed by Proper Instructions to make any payment or transfer of funds on behalf of a Portfolio for which there would be, at the close of business on the date of such payment or transfer, insufficient funds held by the Custodian on behalf of such Portfolio, the Custodian may, in its discretion, provide an overdraft (an "Overdraft") to the applicable Fund on behalf of such Portfolio, in an amount sufficient to allow the completion of such payment. Any Overdraft provided hereunder: (a) shall be payable on the next Business Day, unless otherwise agreed by the applicable Fund and the Custodian; and (b) shall accrue interest from the date of the Overdraft to the date of payment in full by the applicable Fund on behalf of the applicable Portfolio at a rate agreed upon in writing, from time to time, by the Custodian and the applicable Fund. The Custodian and each Fund acknowledge that the purpose of such Overdrafts is to temporarily finance the purchase or sale of securities for prompt delivery in accordance with the terms hereof, or to meet emergency expenses not reasonably foreseeable by such Fund. The Custodian shall promptly notify each applicable Fund in writing (an "Overdraft Notice") of any Overdraft by facsimile transmission or in such other manner as such Fund and the Custodian may agree in writing. At the request of the Custodian, each applicable Fund, on behalf of one or more of its Portfolios, shall pledge, assign and grant to the Custodian a security interest in certain specified securities of the applicable Portfolio, as security for Overdrafts provided to such Portfolio, under the terms and conditions set forth in Appendix "C" attached hereto. ARTICLE III PROPER INSTRUCTIONS, SPECIAL INSTRUCTIONS AND RELATED MATTERS Section 3.01. Proper Instructions and Special Instructions. (a) Proper Instructions. As used herein, the term "Proper Instructions" shall mean: (i) a tested telex, a written (including, without limitation, facsimile transmission) request, direction, instruction or certification signed or initialed by or on behalf of the applicable Fund by one or more Authorized Persons (as hereinafter defined); (ii) a telephonic or other oral communication by one or more Authorized Persons; or (iii) a communication effected directly between an electro-mechanical or electronic device or system (including, without limitation, computers) by or on behalf of the applicable Fund by one or more Authorized Persons; provided, however, that communications of the types described in clauses (ii) and (iii) above purporting to be given by an Authorized Person shall be considered Proper Instructions only if the Custodian reasonably believes such communications to have been given by an Authorized Person with respect to the transaction involved. Proper Instructions in the form of oral communications shall be confirmed by the applicable Fund by tested telex or in writing in the manner set forth in clause (i) above, but the lack of such confirmation shall in no way affect any action taken by the Custodian in reliance upon such oral instructions prior to the Custodian's receipt of such confirmation. Each Fund and the Custodian are hereby authorized to record any and all telephonic or other oral instructions communicated to the Custodian. Proper Instructions may relate to specific transactions or to types or classes of transactions, and may be in the form of standing instructions. (b) Special Instructions. As used herein, the term "Special Instructions" shall mean Proper Instructions countersigned or confirmed in writing by the Treasurer or any Assistant Treasurer of the applicable Fund or any other person designated by the Treasurer of such Fund in writing, which countersignature or confirmation shall be (i) included on the same instrument containing the Proper Instructions or on a separate instrument relating thereto, and (ii) delivered by hand, by facsimile transmission, or in such other manner as the applicable Fund and the Custodian agree in writing. (c) Address for Proper Instructions and Special Instructions. Proper Instructions and Special Instructions shall be delivered to the Custodian at the address and/or telephone, telecopy or telex number agreed upon from time to time by the Custodian and the applicable Fund. Section 3.02. Authorized Persons. Concurrently with the execution of this Agreement and from time to time thereafter, as appropriate, each Fund shall deliver to the Custodian, duly certified as appropriate by a Treasurer or Assistant Treasurer of such Fund, a certificate setting forth: (a) the names, titles, signatures and scope of authority of all persons authorized to give Proper Instructions or any other notice, request, direction, instruction, certificate or instrument on behalf of such Fund (collectively, the "Authorized Persons" and individually, an "Authorized Person"); and (b) the names, titles and signatures of those persons authorized to issue Special Instructions. Such certificate may be accepted and relied upon by the Custodian as conclusive evidence of the facts set forth therein and shall be considered to be in full force and effect until delivery to the Custodian of a similar certificate to the contrary. Upon delivery of a certificate which deletes the name(s) of a person previously authorized by a Fund to give Proper Instructions or to issue Special Instructions, such persons shall no longer be considered an Authorized Person or authorized to issue Special Instructions for that Fund. Section 3.03. Persons Having Access to Assets of the Portfolios. Notwithstanding anything to the contrary contained in this Agreement, no Authorized Person, Trustee, officer, employee or agent of any Fund shall have physical access to the assets of any Portfolio of that Fund held by the Custodian nor shall the Custodian deliver any assets of a Portfolio for delivery to an account of such person; provided, however, that nothing in this Section 3.03 shall prohibit (a) any Authorized Person from giving Proper Instructions, or any person authorized to issue Special Instructions from issuing Special Instructions, so long as such action does not result in delivery of or access to assets of any Portfolio prohibited by this Section 3.03; or (b) each Fund's independent certified public accountants from examining or reviewing the assets of the Portfolios of the Fund held by the Custodian. Each Fund shall deliver to the Custodian a written certificate identifying such Authorized Persons, Trustees, officers, employees and agents of such Fund. Section 3.04. Actions of Custodian Based on Proper Instructions and Special Instructions. So long as and to the extent that the Custodian acts in accordance with (a) Proper Instructions or Special Instructions, as the case may be, and (b) the terms of this Agreement, the Custodian shall not be responsible for the title, validity or genuineness of any property, or evidence of title thereof, received by it or delivered by it pursuant to this Agreement. ARTICLE IV SUBCUSTODIANS The Custodian may, from time to time, in accordance with the relevant provisions of this Article IV, appoint one or more Domestic Subcustodians, Foreign Subcustodians, Interim Subcustodians and Special Subcustodians to act on behalf of a Portfolio. (For purposes of this Agreement, all duly appointed Domestic Subcustodians, Foreign Subcustodians, Interim Subcustodians, and Special Subcustodians are hereinafter referred to collectively, as "Subcustodians.") Section 4.01. Domestic Subcustodians. The Custodian may, at any time and from time to time, appoint any bank as defined in Section 2(a)(5) of the 1940 Act meeting the requirements of a custodian under Section 17(f) of the 1940 Act and the rules and regulations thereunder, to act on behalf of one or more Portfolios as a subcustodian for purposes of holding cash, securities and other assets of such Portfolios and performing other functions of the Custodian within the United States (a "Domestic Subcustodian"); provided, that, the Custodian shall notify each applicable Fund in writing of the identity and qualifications of any proposed Domestic Subcustodian at least thirty (30) days prior to appointment of such Domestic Subcustodian, and such Fund may, in its sole discretion, by written notice to the Custodian executed by an Authorized Person disapprove of the appointment of such Domestic Subcustodian. If, following notice by the Custodian to each applicable Fund regarding appointment of a Domestic Subcustodian and the expiration of thirty (30) days after the date of such notice, such Fund shall have failed to notify the Custodian of its disapproval thereof, the Custodian may, in its discretion, appoint such proposed Domestic Subcustodian as its subcustodian. Section 4.02. Foreign Subcustodians and Interim Subcustodians. (a) Foreign Subcustodians. The Custodian may, at any time and from time to time, appoint: (i) any bank, trust company or other entity meeting the requirements of an "eligible foreign custodian" under Section 17(f) of the 1940 Act and the rules and regulations thereunder or by order of the Securities and Exchange Commission exempted therefrom, or (ii) any bank as defined in Section 2(a)(5) of the 1940 Act meeting the requirements of a custodian under Section 17(f) of the 1940 Act and the rules and regulations thereunder to act on behalf of one or more Portfolios as a subcustodian for purposes of holding cash, securities and other assets of such Portfolios and performing other functions of the Custodian in countries other than the United States of America (a "Foreign Subcustodian"); provided, that, prior to the appointment of any Foreign Subcustodian, the Custodian shall have obtained written confirmation of the approval of the Board of Trustees or other governing body or entity of each applicable Fund on behalf of its applicable Portfolio(s) (which approval may be withheld in the sole discretion of such Board of Trustees or other governing body or entity) with respect to (i) the identity and qualifications of any proposed Foreign Subcustodian, (ii) the country or countries in which, and the securities depositories or clearing agencies, if any, through which, any proposed Foreign Subcustodian is authorized to hold securities and other assets of the applicable Portfolio(s), and (iii) the form and terms of the subcustodian agreement to be entered into between such proposed Foreign Subcustodian and the Custodian. Each such duly approved Foreign Subcustodian and the countries where and the securities depositories and clearing agencies through which they may hold securities and other assets of the applicable Portfolios shall be listed on Appendix "B" attached hereto, as it may be amended, from time to time, in accordance with the provisions of Section 9.05(c) hereof. Each Fund shall be responsible for informing the Custodian sufficiently in advance of a proposed investment by one of its Portfolios which is to be held in a country in which no Foreign Subcustodian is authorized to act, in order that there shall be sufficient time for the Custodian to effect the appropriate arrangements with a proposed foreign subcustodian, including obtaining approval as provided in this Section 4.02(a). The Custodian shall not amend any subcustodian agreement entered into with a Foreign Subcustodian, or agree to change or permit any changes thereunder, or waive any rights under such agreement, which materially affect a Fund's rights or the Foreign Subcustodian's obligations or duties to a Fund under such agreement, except upon prior approval pursuant to Special Instructions. (b) Interim Subcustodians. Notwithstanding the foregoing, in the event that a Portfolio shall invest in a security or other asset to be held in a country in which no Foreign Subcustodian is authorized to act, the Custodian shall promptly notify the applicable Fund in writing by facsimile transmission or in such other manner as such Fund and Custodian shall agree in writing of the unavailability of an approved Foreign Subcustodian in such country; and the Custodian shall, upon receipt of Special Instructions, appoint any Person designated by the applicable Fund in such Special Instructions to hold such security or other asset. (Any Person appointed as a subcustodian pursuant to this Section 4.02(b) is hereinafter referred to as an "Interim Subcustodian.") Section 4.03. Special Subcustodians. Upon receipt of Special Instructions, the Custodian shall, on behalf of one or more Portfolios, appoint one or more banks, trust companies or other entities designated in such Special Instructions to act as a subcustodian for purposes of: (i) effecting third-party repurchase transactions with banks, brokers, dealers or other entities through the use of a common custodian or subcustodian; (ii) establishing a joint trading account for the applicable Portfolio(s) and other registered open-end management investment companies for which Fidelity Management & Research Company serves as investment adviser, through which such Portfolios and such other investment companies shall collectively participate in certain repurchase transactions; (iii) providing depository and clearing agency services with respect to certain variable rate demand note securities; and (iv) effecting any other transactions designated by each applicable Fund in Special Instructions. (Each such designated subcustodian is hereinafter referred to as a "Special Subcustodian.") Each such duly appointed Special Subcustodian shall be listed on Appendix "B" attached hereto, as it may be amended from time to time in accordance with the provisions of Section 9.05(c) hereof. In connection with the appointment of any Special Subcustodian, the Custodian shall enter into a subcustodian agreement with the Special Subcustodian in form and substance approved by each applicable Fund, provided that such agreement shall in all events comply with the provisions of the 1940 Act and the rules and regulations thereunder and the terms and provisions of this Agreement. The Custodian shall not amend any subcustodian agreement entered into with a Special Subcustodian, or agree to change or permit any changes thereunder, or waive any rights under such agreement, except upon prior approval pursuant to Special Instructions. Section 4.04. Termination of a Subcustodian. The Custodian shall (i) cause each Domestic Subcustodian and Foreign Subcustodian to, and (ii) use its best efforts to cause each Interim Subcustodian and Special Subcustodian to, perform all of its obligations in accordance with the terms and conditions of the subcustodian agreement between the Custodian and such Subcustodian. In the event that the Custodian is unable to cause such Subcustodian to fully perform its obligations thereunder, the Custodian shall forthwith, upon the receipt of Special Instructions, terminate such Subcustodian with respect to each applicable Fund and, if necessary or desirable, appoint a replacement Subcustodian in accordance with the provisions of Section 4.01 or Section 4.02, as the case may be. In addition to the foregoing, the Custodian (A) may, at any time in its discretion, upon written notification to each applicable Fund, terminate any Domestic Subcustodian, Foreign Subcustodian or Interim Subcustodian, and (B) shall, upon receipt of Special Instructions, terminate any Subcustodian with respect to each applicable Fund, in accordance with the termination provisions under the applicable subcustodian agreement. Section 4.05. Certification Regarding Foreign Subcustodians. Upon request of a Fund, the Custodian shall deliver to such Fund a certificate stating: (i) the identity of each Foreign Subcustodian then acting on behalf of the Custodian for such Fund and its Portfolios; (ii) the countries in which and the securities depositories and clearing agents through which each such Foreign Subcustodian is then holding cash, securities and other assets of any Portfolio of such Fund; and (iii) such other information as may be requested by such Fund to ensure compliance with Rule 17(f)-5 under the 1940 Act. ARTICLE V STANDARD OF CARE; INDEMNIFICATION Section 5.01. Standard of Care. (a) General Standard of Care. The Custodian shall exercise reasonable care and diligence in carrying out all of its duties and obligations under this Agreement, and shall be liable to each Fund for all loss, damage and expense suffered or incurred by such Fund or its Portfolios resulting from the failure of the Custodian to exercise such reasonable care and diligence. (b) Actions Prohibited by Applicable Law, Etc. In no event shall the Custodian incur liability hereunder if the Custodian or any Subcustodian or Securities System, or any subcustodian, securities depository or securities system utilized by any such Subcustodian, or any nominee of the Custodian or any Subcustodian (individually, a "Person") is prevented, forbidden or delayed from performing, or omits to perform, any act or thing which this Agreement provides shall be performed or omitted to be performed, by reason of: (i) any provision of any present or future law or regulation or order of the United States of America, or any state thereof, or of any foreign country, or political subdivision thereof or of any court of competent jurisdiction; or (ii) any act of God or war or other similar circumstance beyond the control of the Custodian, unless, in each case, such delay or nonperformance is caused by (A) the negligence, misfeasance or misconduct of the applicable Person, or (B) a malfunction or failure of equipment operated or utilized by the applicable Person other than a malfunction or failure beyond such Person's control and which could not reasonably be anticipated and/or prevented by such Person. (c) Mitigation by Custodian. Upon the occurrence of any event which causes or may cause any loss, damage or expense to any Fund or Portfolio, (i) the Custodian shall, (ii) the Custodian shall cause any applicable Domestic Subcustodian or Foreign Subcustodian to, and (iii) the Custodian shall use its best efforts to cause any applicable Interim Subcustodian or Special Subcustodian to, use all commercially reasonable efforts and take all reasonable steps under the circumstances to mitigate the effects of such event and to avoid continuing harm to the Funds and the Portfolios. (d) Advice of Counsel. The Custodian shall be entitled to receive and act upon advice of counsel on all matters. The Custodian shall be without liability for any action reasonably taken or omitted in good faith pursuant to the advice of (i) counsel for the applicable Fund or Funds, or (ii) at the expense of the Custodian, such other counsel as the applicable Fund(s) and the Custodian may agree upon; provided, however, with respect to the performance of any action or omission of any action upon such advice, the Custodian shall be required to conform to the standard of care set forth in Section 5.01(a). (e) Expenses of the Funds. In addition to the liability of the Custodian under this Article V, the Custodian shall be liable to each applicable Fund for all reasonable costs and expenses incurred by such Fund in connection with any claim by such Fund against the Custodian arising from the obligations of the Custodian hereunder, including, without limitation, all reasonable attorneys' fees and expenses incurred by such Fund in asserting any such claim, and all expenses incurred by such Fund in connection with any investigations, lawsuits or proceedings relating to such claim; provided, that such Fund has recovered from the Custodian for such claim. (f) Liability for Past Records. The Custodian shall have no liability in respect of any loss, damage or expense suffered by a Fund, insofar as such loss, damage or expense arises from the performance of the Custodian's duties hereunder by reason of the Custodian's reliance upon records that were maintained for such Fund by entities other than the Custodian prior to the Custodian's appointment as custodian for such Fund. Section 5.02. Liability of Custodian for Actions of Other Persons. (a) Domestic Subcustodians and Foreign Subcustodians. The Custodian shall be liable for the actions or omissions of any Domestic Subcustodian or any Foreign Subcustodian to the same extent as if such action or omission were performed by the Custodian itself. In the event of any loss, damage or expense suffered or incurred by a Fund caused by or resulting from the actions or omissions of any Domestic Subcustodian or Foreign Subcustodian for which the Custodian would otherwise be liable, the Custodian shall promptly reimburse such Fund in the amount of any such loss, damage or expense. (b) Interim Subcustodians. Notwithstanding the provisions of Section 5.01 to the contrary, the Custodian shall not be liable to a Fund for any loss, damage or expense suffered or incurred by such Fund or any of its Portfolios resulting from the actions or omissions of an Interim Subcustodian unless such loss, damage or expense is caused by, or results from, the negligence, misfeasance or misconduct of the Custodian; provided, however, in the event of any such loss, damage or expense, the Custodian shall take all reasonable steps to enforce such rights as it may have against such Interim Subcustodian to protect the interests of the Funds and the Portfolios. (c) Special Subcustodians and Additional Custodians. Notwithstanding the provisions of Section 5.01 to the contrary and except as otherwise provided in any subcustodian agreement to which the Custodian, a Fund and any Special Subcustodian or Additional Custodian are parties, the Custodian shall not be liable to a Fund for any loss, damage or expense suffered or incurred by such Fund or any of its Portfolios resulting from the actions or omissions of a Special Subcustodian or Additional Subcustodian, unless such loss, damage or expense is caused by, or results from, the negligence, misfeasance or misconduct of the Custodian; provided, however, that in the event of any such loss, damage or expense, the Custodian shall take all reasonable steps to enforce such rights as it may have against any Special Subcustodian or Additional Custodian to protect the interests of the Funds and the Portfolios. (d) Securities Systems. Notwithstanding the provisions of Section 5.01 to the contrary, the Custodian shall not be liable to a Fund for any loss, damage or expense suffered or incurred by such Fund or any of its Portfolios resulting from the use by the Custodian of a Securities System, unless such loss, damage or expense is caused by, or results from, the negligence, misfeasance or misconduct of the Custodian; provided, however, that in the event of any such loss, damage or expense, the Custodian shall take all reasonable steps to enforce such rights as it may have against the Securities System to protect the interests of the Funds and the Portfolios. (e) Reimbursement of Expenses. Each Fund agrees to reimburse the Custodian for all reasonable out-of-pocket expenses incurred by the Custodian on behalf of such Fund in connection with the fulfillment of its obligations under this Section 5.02; provided, however, that such reimbursement shall not apply to expenses occasioned by or resulting from the negligence, misfeasance or misconduct of the Custodian. Section 5.03. Indemnification. (a) Indemnification Obligations. Subject to the limitations set forth in this Agreement, each Fund severally and not jointly agrees to indemnify and hold harmless the Custodian and its nominees from all loss, damage and expense (including reasonable attorneys' fees) suffered or incurred by the Custodian or its nominee caused by or arising from actions taken by the Custodian on behalf of such Fund in the performance of its duties and obligations under this Agreement; provided, however, that such indemnity shall not apply to loss, damage and expense occasioned by or resulting from the negligence, misfeasance or misconduct of the Custodian or its nominee. In addition, each Fund agrees severally and not jointly to indemnify any Person against any liability incurred by reason of taxes assessed to such Person, or other loss, damage or expenses incurred by such Person, resulting from the fact that securities and other property of such Fund's Portfolios are registered in the name of such Person; provided, however, that in no event shall such indemnification be applicable to income, franchise or similar taxes which may be imposed or assessed against any Person. (b) Notice of Litigation, Right to Prosecute, Etc. No Fund shall be liable for indemnification under this Section 5.03 unless a Person shall have promptly notified such Fund in writing of the commencement of any litigation or proceeding brought against such Person in respect of which indemnity may be sought under this Section 5.03. With respect to claims in such litigation or proceedings for which indemnity by a Fund may be sought and subject to applicable law and the ruling of any court of competent jurisdiction, such Fund shall be entitled to participate in any such litigation or proceeding and, after written notice from such Fund to any Person, such Fund may assume the defense of such litigation or proceeding with counsel of its choice at its own expense in respect of that portion of the litigation for which such Fund may be subject to an indemnification obligation; provided, however, a Person shall be entitled to participate in (but not control) at its own cost and expense, the defense of any such litigation or proceeding if such Fund has not acknowledged in writing its obligation to indemnify the Person with respect to such litigation or proceeding. If such Fund is not permitted to participate or control such litigation or proceeding under applicable law or by a ruling of a court of competent jurisdiction, such Person shall reasonably prosecute such litigation or proceeding. A Person shall not consent to the entry of any judgment or enter into any settlement in any such litigation or proceeding without providing each applicable Fund with adequate notice of any such settlement or judgment, and without each such Fund's prior written consent. All Persons shall submit written evidence to each applicable Fund with respect to any cost or expense for which they are seeking indemnification in such form and detail as such Fund may reasonably request. Section 5.04. Investment Limitations. If the Custodian has otherwise complied with the terms and conditions of this Agreement in performing its duties generally, and more particularly in connection with the purchase, sale or exchange of securities made by or for a Portfolio, the Custodian shall not be liable to the applicable Fund and such Fund agrees to indemnify the Custodian and its nominees, for any loss, damage or expense suffered or incurred by the Custodian and its nominees arising out of any violation of any investment or other limitation to which such Fund is subject. Section 5.05. Fund's Right to Proceed. Notwithstanding anything to the contrary contained herein, each Fund shall have, at its election upon reasonable notice to the Custodian, the right to enforce, to the extent permitted by any applicable agreement and applicable law, the Custodian's rights against any Subcustodian, Securities System, or other Person for loss, damage or expense caused such Fund by such Subcustodian, Securities System, or other Person, and shall be entitled to enforce the rights of the Custodian with respect to any claim against such Subcustodian, Securities System or other Person, which the Custodian may have as a consequence of any such loss, damage or expense, if and to the extent that such Fund has not been made whole for any such loss or damage. If the Custodian makes such Fund whole for any such loss or damage, the Custodian shall retain the ability to enforce its rights directly against such Subcustodian, Securities System or other Person. Upon such Fund's election to enforce any rights of the Custodian under this Section 5.05, such Fund shall reasonably prosecute all actions and proceedings directly relating to the rights of the Custodian in respect of the loss, damage or expense incurred by such Fund; provided that, so long as such Fund has acknowledged in writing its obligation to indemnify the Custodian under Section 5.03 hereof with respect to such claim, such Fund shall retain the right to settle, compromise and/or terminate any action or proceeding in respect of the loss, damage or expense incurred by such Fund without the Custodian's consent and provided further, that if such Fund has not made an acknowledgement of its obligation to indemnify, such Fund shall not settle, compromise or terminate any such action or proceeding without the written consent of the Custodian, which consent shall not be unreasonably withheld or delayed. The Custodian agrees to cooperate with each Fund and take all actions reasonably requested by such Fund in connection with such Fund's enforcement of any rights of the Custodian. Each Fund agrees to reimburse the Custodian for all reasonable out-of-pocket expenses incurred by the Custodian on behalf of such Fund in connection with the fulfillment of its obligations under this Section 5.05; provided, however, that such reimbursement shall not apply to expenses occasioned by or resulting from the negligence, misfeasance or misconduct of the Custodian. ARTICLE VI COMPENSATION On behalf of each of its Portfolios, each Fund shall compensate the Custodian in an amount, and at such times, as may be agreed upon in writing, from time to time, by the Custodian and such Fund. ARTICLE VII TERMINATION Section 7.01. Termination of Agreement as to One or More Funds. With respect to each Fund, this Agreement shall continue in full force and effect until the first to occur of: (a) termination by the Custodian by an instrument in writing delivered or mailed to such Fund, such termination to take effect not sooner than ninety (90) days after the date of such delivery; (b) termination by such Fund by an instrument in writing delivered or mailed to the Custodian, such termination to take effect not sooner than thirty (30) days after the date of such delivery; or (c) termination by such Fund by written notice delivered to the Custodian, based upon such Fund's determination that there is a reasonable basis to conclude that the Custodian is insolvent or that the financial condition of the Custodian is deteriorating in any material respect, in which case termination shall take effect upon the Custodian's receipt of such notice or at such later time as such Fund shall designate. In the event of termination pursuant to this Section 7.01 by any Fund (a "Terminating Fund"), each Terminating Fund shall make payment of all accrued fees and unreimbursed expenses with respect to such Terminating Fund within a reasonable time following termination and delivery of a statement to the Terminating Fund setting forth such fees and expenses. Each Terminating Fund shall identify in any notice of termination a successor custodian or custodians to which the cash, securities and other assets of its Portfolios shall, upon termination of this Agreement with respect to such Terminating Fund, be delivered. In the event that no written notice designating a successor custodian shall have been delivered to the Custodian on or before the date when termination of this Agreement as to a Terminating Fund shall become effective, the Custodian may deliver to a bank or trust company doing business in Boston, Massachusetts, of its own selection, having an aggregate capital, surplus, and undivided profits, as shown by its last published report, of not less than $25,000,000, all securities and other assets of such Terminating Fund's Portfolios held by the Custodian and all instruments held by the Custodian relative thereto and all other property of the Terminating Fund's Portfolios held by the Custodian under this Agreement. Thereafter, such bank or trust company shall be the successor of the Custodian with respect to such Terminating Fund under this Agreement. In the event that securities and other assets of such Terminating Fund's Portfolios remain in the possession of the Custodian after the date of termination hereof with respect to such Terminating Fund owing to failure of the Terminating Fund to appoint a successor custodian, the Custodian shall be entitled to compensation for its services in accordance with the fee schedule most recently in effect, for such period as the Custodian retains possession of such securities and other assets, and the provisions of this Agreement relating to the duties and obligations of the Custodian and the Terminating Fund shall remain in full force and effect. In the event of the appointment of a successor custodian, it is agreed that the cash, securities and other property owned by a Terminating Fund and held by the Custodian, any Subcustodian or nominee shall be delivered to the successor custodian; and the Custodian agrees to cooperate with such Terminating Fund in the execution of documents and performance of other actions necessary or desirable in order to substitute the successor custodian for the Custodian under this Agreement. Section 7.02. Termination as to One or More Portfolios. This Agreement may be terminated as to one or more of a Fund's Portfolios (but less than all of its Portfolios) by delivery of an amended Appendix "A" deleting such Portfolios pursuant to Section 9.05(b) hereof, in which case termination as to such deleted Portfolios shall take effect thirty (30) days after the date of such delivery. The execution and delivery of an amended Appendix "A" which deletes one or more Portfolios shall constitute a termination of this Agreement only with respect to such deleted Portfolio(s), shall be governed by the preceding provisions of Section 7.01 as to the identification of a successor custodian and the delivery of cash, securities and other assets of the Portfolio(s) so deleted, and shall not affect the obligations of the Custodian and any Fund hereunder with respect to the other Portfolios set forth in Appendix "A," as amended from time to time. ARTICLE VIII DEFINED TERMS The following terms are defined in the following sections: Term Section Account 2.22 ADRs 2.06 Additional Custodian 2.23(a) Authorized Person(s) 3.02 Banking Institution 2.12(a) Business Day Appendix "C" Bank Accounts 2.21 Distribution Account 2.16 Domestic Subcustodian 4.01 Foreign Subcustodian 4.02(a) Fund Preamble Institutional Client 2.03 Interim Subcustodian 4.02(b) Overdraft 2.28 Overdraft Notice 2.28 Person 5.01(b) Portfolio Preamble Procedural Agreement 2.10 Proper Instructions 3.01(a) SEC 2.22 Securities System 2.22 Shares 2.16 Special Instructions 3.01(b) Special Subcustodian 4.03 Subcustodian Article IV Terminating Fund 7.01 1940 Act Preamble ARTICLE IX MISCELLANEOUS Section 9.01. Execution of Documents, Etc. (a) Actions by each Fund. Upon request, each Fund shall execute and deliver to the Custodian such proxies, powers of attorney or other instruments as may be reasonable and necessary or desirable in connection with the performance by the Custodian or any Subcustodian of their respective obligations to such Fund under this Agreement or any applicable subcustodian agreement with respect to such Fund, provided that the exercise by the Custodian or any Subcustodian of any such rights shall in all events be in compliance with the terms of this Agreement. (b) Actions by Custodian. Upon receipt of Proper Instructions, the Custodian shall execute and deliver to each applicable Fund or to such other parties as such Fund(s) may designate in such Proper Instructions, all such documents, instruments or agreements as may be reasonable and necessary or desirable in order to effectuate any of the transactions contemplated hereby. Section 9.02. Representative Capacity; Nonrecourse Obligations. A COPY OF THE DECLARATION OF TRUST OR OTHER ORGANIZATIONAL DOCUMENT OF EACH FUND IS ON FILE WITH THE SECRETARY OF THE STATE OF THE FUND'S FORMATION, AND NOTICE IS HEREBY GIVEN THAT THIS AGREEMENT IS NOT EXECUTED ON BEHALF OF THE TRUSTEES OF ANY FUND AS INDIVIDUALS, AND THE OBLIGATIONS OF THIS AGREEMENT ARE NOT BINDING UPON ANY OF THE TRUSTEES, OFFICERS, SHAREHOLDERS OR PARTNERS OF ANY FUND INDIVIDUALLY, BUT ARE BINDING ONLY UPON THE ASSETS AND PROPERTY OF EACH FUND'S RESPECTIVE PORTFOLIOS. THE CUSTODIAN AGREES THAT NO SHAREHOLDER, TRUSTEE, OFFICER OR PARTNER OF ANY FUND MAY BE HELD PERSONALLY LIABLE OR RESPONSIBLE FOR ANY OBLIGATIONS OF ANY FUND ARISING OUT OF THIS AGREEMENT. Section 9.03. Several Obligations of the Funds and the Portfolios. WITH RESPECT TO ANY OBLIGATIONS OF A FUND ON BEHALF OF ANY OF ITS PORTFOLIOS ARISING OUT OF THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, THE OBLIGATIONS ARISING UNDER SECTIONS 2.28, 5.03, 5.05 and ARTICLE VI HEREOF, THE CUSTODIAN SHALL LOOK FOR PAYMENT OR SATISFACTION OF ANY OBLIGATION SOLELY TO THE ASSETS AND PROPERTY OF THE PORTFOLIO TO WHICH SUCH OBLIGATION RELATES AS THOUGH EACH FUND HAD SEPARATELY CONTRACTED WITH THE CUSTODIAN BY SEPARATE WRITTEN INSTRUMENT WITH RESPECT TO EACH OF ITS PORTFOLIOS. Section 9.04. Representations and Warranties. (a) Representations and Warranties of Each Fund. Each Fund hereby severally and not jointly represents and warrants that each of the following shall be true, correct and complete with respect to each Fund at all times during the term of this Agreement: (i) the Fund is duly organized under the laws of its jurisdiction of organization and is registered as an open-end management investment company under the 1940 Act; and (ii) the execution, delivery and performance by the Fund of this Agreement are (w) within its power, (x) have been duly authorized by all necessary action, and (y) will not (A) contribute to or result in a breach of or default under or conflict with any existing law, order, regulation or ruling of any governmental or regulatory agency or authority, or (B) violate any provision of the Fund's corporate charter, Declaration of Trust or other organizational document, or bylaws, or any amendment thereof or any provision of its most recent Prospectus or Statement of Additional Information. (b) Representations and Warranties of the Custodian. The Custodian hereby represents and warrants to each Fund that each of the following shall be true, correct and complete at all times during the term of this Agreement: (i) the Custodian is duly organized under the laws of its jurisdiction of organization and qualifies to act as a custodian to open-end management investment companies under the provisions of the 1940 Act; and (ii) the execution, delivery and performance by the Custodian of this Agreement are (w) within its power, (x) have been duly authorized by all necessary action, and (y) will not (A) contribute to or result in a breach of or default under or conflict with any existing law, order, regulation or ruling of any governmental or regulatory agency or authority, or (B) violate any provision of the Custodian's corporate charter, or other organizational document, or bylaws, or any amendment thereof. Section 9.05. Entire Agreement. This Agreement constitutes the entire understanding and agreement of the Fund, on the one hand, and the Custodian, on the other, with respect to the subject matter hereof and accordingly, supersedes as of the effective date of this Agreement any custodian agreement heretofore in effect between each Fund and the Custodian. Section 9.06. Waivers and Amendments. No provision of this Agreement may be waived, amended or terminated except by a statement in writing signed by the party against which enforcement of such waiver, amendment or termination is sought; provided, however: (a) Appendix "A" listing the Portfolios of each Fund for which the Custodian serves as custodian may be amended from time to time to add one or more Portfolios for one or more Funds, by each applicable Fund's execution and delivery to the Custodian of an amended Appendix "A", and the execution of such amended Appendix by the Custodian, in which case such amendment shall take effect immediately upon execution by the Custodian; (b) Appendix "A" may be amended from time to time to delete one or more Portfolios (but less than all of the Portfolios) of one or more of the Funds, by each applicable Fund's execution and delivery to the Custodian of an amended Appendix "A", in which case such amendment shall take effect thirty (30) days after such delivery, unless otherwise agreed by the Custodian and each applicable Fund in writing; (c) Appendix "B" listing Foreign Subcustodians, Special Subcustodians and Additional Custodians approved by any Fund may be amended from time to time to add or delete one or more Foreign Subcustodians, Special Subcustodians or Additional Custodians for a Fund or Funds by each applicable Fund's execution and delivery to the Custodian of an amended Appendix "B", in which case such amendment shall take effect immediately upon execution by the Custodian; and (d) Appendix "C" setting forth the procedures relating to the Custodian's security interest with respect to each Fund may be amended only by an instrument in writing executed by each applicable Fund and the Custodian. Section 9.07. Interpretation. In connection with the operation of this Agreement, the Custodian and any Fund may agree in writing from time to time on such provisions interpretative of or in addition to the provisions of this Agreement with respect to such Fund as may in their joint opinion be consistent with the general tenor of this Agreement. No interpretative or additional provisions made as provided in the preceding sentence shall be deemed to be an amendment of this Agreement or affect any other Fund. Section 9.08. Captions. Headings contained in this Agreement, which are included as convenient references only, shall have no bearing upon the interpretation of the terms of the Agreement or the obligations of the parties hereto. Section 9.09. Governing Law. Insofar as any question or dispute may arise in connection with the custodianship of foreign securities pursuant to an agreement with a Foreign Subcustodian that is governed by the laws of the State of New York, the provisions of this Agreement shall be construed in accordance with and governed by the laws of the State of New York, provided that in all other instances this Agreement shall be construed in accordance with and governed by the laws of the Commonwealth of Massachusetts, in each case without giving effect to principles of conflicts of law. Section 9.10. Notices. Except in the case of Proper Instructions or Special Instructions, notices and other writings contemplated by this Agreement shall be delivered by hand or by facsimile transmission (provided that in the case of delivery by facsimile transmission, notice shall also be mailed postage prepaid to the parties at the following addresses: (a) If to any Fund: c/o Fidelity Management & Research Company 82 Devonshire Street Boston, Massachusetts 02109 Attn: Treasurer of the Fidelity Funds Telephone: (617) 563-7000 Telefax: (617) 476-4195 (b) If to the Custodian: Brown Brothers Harriman & Company 40 Water Street Boston, Massachusetts 02109 Attn: W. Casey Gildea, Assistant Manager Telephone: (617) 772-1330 Telefax: (617) 772-2263 or to such other address as a Fund or the Custodian may have designated in writing to the other. Section 9.11. Assignment. This Agreement shall be binding on and shall inure to the benefit of each Fund severally and the Custodian and their respective successors and assigns, provided that, subject to the provisions of Section 7.01 hereof, neither the Custodian nor any Fund may assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the other party. Section 9.12. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original. With respect to each Fund, this Agreement shall become effective when one or more counterparts have been signed and delivered by such Fund and the Custodian. Section 9.13. Confidentiality; Survival of Obligations. The parties hereto agree that each shall treat confidentially the terms and conditions of this Agreement and all information provided by each party to the other regarding its business and operations. All confidential information provided by a party hereto shall be used by any other party hereto solely for the purpose of rendering services pursuant to this Agreement and, except as may be required in carrying out this Agreement, shall not be disclosed to any third party without the prior consent of such providing party. The foregoing shall not be applicable to any information that is publicly available when provided or thereafter becomes publicly available other than through a breach of this Agreement, or that is required to be disclosed by any bank examiner of the Custodian or any Subcustodian, any auditor of the parties hereto, by judicial or administrative process or otherwise by applicable law or regulation. The provisions of this Section 9.13 and Sections 9.01, 9.02, 9.03, 9.09, Section 2.28, Section 3.04, Section 7.01, Article V and Article VI hereof and any other rights or obligations incurred or accrued by any party hereto prior to termination of this Agreement shall survive any termination of this Agreement. IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed in its name and behalf on the day and year first above written. Each of the Investment Companies Listed on Brown Brothers Harriman & Company Appendix "A" Attached Hereto, on Behalf of each of Their Respective Portfolios [Signature Lines Omitted] Exhibit 8(p) Form of Appendix "B" To Custodian Agreement Between Brown Brothers Harriman & Co. and Each of the Investment Companies Listed on Appendix "A" thereto Dated as of The following is a list of Additional Custodians, Special Subcustodians and Foreign Subcustodians under the Custodian Agreement dated as of ____________ (the "Custodian Agreement"): A. Additional Custodians CUSTODIAN PURPOSE Bank of New York FICASH FITERM B. Special Subcustodians: SUBCUSTODIAN PURPOSE Bank of New York FICASH C. Foreign Subcustodians: COUNTRY FOREIGN SUBCUSTODIAN DEPOSITORY Argentina Citibank, N.A., Buenos Aires Caja de Valores, S.A.; (Citibank, N.A., New York Agt. 7/16/81 Central de Registracion y New York Agreement Amendment 8/31/90) Liquidacion de Instrumentos de Endeudamiento Publico (CRYL) First National Bank of Boston, Buenos Aires (First Nat. Bank of Boston Agreement 1/15/88 Omnibus Amendment 2/22/94) Australia National Australia Bank Ltd., Melbourne Austraclear Limited; (National Australia Bank Agt. 5/1/85 Reserve Bank Information and Agreement Amendment 2/13/92 Transfer System (RITS) Omnibus Amendment 11/22/93) Austria Creditanstalt-Bankverein, Vienna Oesterreichische Kontrollbank (Creditanstalt Bankverein Agreement 12/18/89 Aktiengesellschaft (OEKB) Omnibus Amendment 1/17/94) Bahrain British Bank of the Middle East, Manama None Bangladesh Standard Chartered Bank, Dhaka None (Standard Chartered Bank Agreement 2/18/92) Belgium Banque Bruxelles Lambert, Brussels Caisse Interprofessionnelle de Depot (Banque Bruxelles Lambert Agreement 11/15/90 et Virements de Titres (CIK) Omnibus Amendment 3/1/94) Banque Nationale de Belgique (BNB) Bostwana Barclays Bank of Bostwana Ltd., Gaborone None (Barclays Bank Agreement 10/5/94) Brazil First National Bank of Boston, Sao Paulo Sao Paulo Stock Exchange (First National Bank of Boston Agreement 1/5/88 (BOVESPA), Sistema Especial de Omnibus Amendment 2/22/94) Liquidacao e Custodia (SELIC); Rio de Janeiro Exchange (BVRJ) Canada Canadian Imperial Bank of Commerce, Toronto Canadian Depository for Securities, (Canadian Imperial Bank of Commerce Ltd., (CDS) Agreement 9/9/88 Omnibus Amendment 12/1/93) Royal Bank of Canada, Toronto Bank of Canada Proposed Agreement Chile Citibank, N.A., Santiago None (Citibank N.A., New York Agreement 7/16/81 New York Agreement Amendment 8/31/90) China-Shanghai Standard Chartered Bank, Shanghai Shanghai Securities Central Clearing (Standard Chartered Bank Agreement 2/18/92) & Registration Corporation (SSCCRC) China-Shenzhen Standard Chartered Bank, Shenzhen Shenzhen Securities Registration (Standard Chartered Bank Agreement 2/18/92) Corp. Ltd., (SSRC) Colombia Cititrust Colombia , S.A., Sociedad Fiduciaria, Bogota None (Citibank N.A., New York Agreement 7/16/81 New York Agreement Amendment 8/31/90 Citibank N.A. Subsidiary Amendment 10/19/95 Citibank N.A./Cititrust Colombia Agreement 12/2/91) Czech Republic Ceskoslovenska Obchodni Banka, S.A., Prague Stredisko Cennych Papiru (SCP) (Ceskoslovenska Obchodni Banka Agreement 2/28/94) Czech National Bank Denmark Den Danske Bank, Copenhagen Vaerdipapircentralen - VP Center (Den Danske Bank Agreement 1/1/89 Omnibus Amendment 12/1/93) Ecuador Citibank, N.A., Quito None (Citibank, N.A. New York Agreement 7/16/81 New York Agreement Amendment 8/31/90 Citibank, Quito Side Letter 7/3/95) Egypt Citibank, N.A., Cairo Misr for Clearing, Settlement (Citibank, N.A. New York Agreement 7/16/81 and Depository New York Agreement Amendment 8/31/90) Finland Merita Bank Ltd., Helsinki Central Share Register of Finland Cooperative (CSR) Helsinki Money Market Center, Ltd. (HMMC) Finnish Central Securities Depository Ltd. France Banque Paribas, Paris SICOVAM Agreement 4/2/93) Banque de France Germany Dresdner Bank AG, Frankfurt Deutscher Kassenverein AG (DKV) (Dresdner Bank Agreement 10/6/95) Ghana Barclays Bank of Ghana Ltd., Accra None (Barclays Bank Agreement 10/5/94) Greece Citibank, N.A., Athens Apothetirion Titlon A.E. (Citibank N.A., New York Agreement 7/16/81 New York Agreement Amendment 8/31/90) Hong Kong The Hongkong & Shanghai Banking Hong Kong Securities Clearing Co. Corp., Ltd., Hong Kong Ltd. (HKSCC); (Hongkong & Shanghai Banking Corp. Agt. 4/19/91 Central Clearing and Omnibus Supplement 12/29/93) Settlement System (CCASS) Hungary Citibank Budapest, Rt. Central Depository and Clearing (Citibank N.A., New York Agreement 7/16/81 House (Budapest) Ltd., New York Agreement Amendment 8/31/90 (KELER Ltd.) Citibank N.A. Subsidiary Amendment 10/19/95 Citibank N.A./Citibank Budapest Agmt. 1/24/92 (amended 6/23/92 and 9/29/92)) India Citibank, N.A., Mumbai National Securities Depository Limted (Citibank N.A., New York Agreement 7/16/81 New York Agreement Amendment 8/31/90 Citibank, Mumbai Amendment 11/17/93) Standard Chartered Bank, Mumbai (Standard Chartered Bank Agreement 2/18/92 SCB, Mumbai Annexure and Side Letter 7/18/94) Indonesia Citibank, N.A., Jakarta None (Citibank N.A., New York Agreement 7/16/81 New York Agreement Amendment 8/31/90) Ireland Allied Irish Banks, plc., Dublin Gilt Settlement Office (GSO) (Allied Irish Banks Agreement 1/10/89 Omnibus Amendment 4/8/94) CREST Israel Bank Hapoalim, B.M. Tel-Aviv Stock Exchange (Bank Hapoalim Agreement 8/27/92) (TASE) Clearinghouse Ltd. Italy Banca Commerciale Italiana, Milan Monte Titoli S.p.A. (Banca Commerciale Italiana Agreement 5/8/89 Agreement Amendment 10/8/93 Banca D'Italia Omnibus Amendment 12/14/93) Japan Sumitomo Trust & Banking Co., Tokyo Japan Securities Depository Center (Sumitomo Trust & Banking Agreement 7/17/92 (JASDEC) Omnibus Amendment 1/13/94); Bank of Japan Jordan Arab Bank, plc, Amman None (Arab Bank Agreement 4/5/95 Kenya Barclays Bank of Kenya Ltd., Nairobi None (Barclays Bank Agreement 10/5/94) Lebanon British Bank of the Middle East, Beirut Midclear Malaysia Hongkong Bank Malaysia Berhad Malaysian Central Depository Sdn. (Hongkong & Shanghai Banking Corp. Agt. 4/19/91 Bhd. (MCD) Omnibus Supplement 12/29/93 Malaysia Subsidiary Supplement 5/23/94) Bank Negara Malaysia Mauritius Hongkong & Shanghai Banking Corp., Ltd., Central Depository & Settlement Co., Port Louis Ltd. Mexico Citibank Mexico, S.A., Mexico City Institucion para el Deposito de (Citibank N.A., New York Agreement 7/16/81 Valores- S.D. INDEVAL, S.A. de New York Agreement Amendment 8/31/90 C.V. Citibank, Mexico, S.A. Amendment 2/7/95) Banco de Mexico Morocco Banque Marocaine du Commerce Exterieur, None Casablanca (BMCE Agreement 7/6/94) Namibia Standard Bank Namibia Ltd., Windhoek None Netherlands ABN-AMRO, Bank N. V., Amsterdam Nederlands Centraal Instituut voor Giraal Effektenverkeer BV (NECIGEF)/KAS Associatie N.V. (ABN-AMRO Agreement 12/19/88) (KAS) De Nederlandsche Bank (DNB)New New Zealand National Australia Bank Ltd., Melbourne Reserve Bank of New Zealand (RBNZ) (National Australia Bank Agreement 5/1/85 Agreement Amendment 2/13/92 New Zealand Securities Omnibus Amendment 11/22/93 Depository Limited (NZCDS) New Zealand Addendum 3/7/89) Norway Den norske Bank ASA, Oslo Verdipapirsentralen (VPS) (Den norske Bank Agreement 11/16/94) Oman British Bank of the Middle East, Muscat Muscat Securities Market Pakistan Standard Chartered Bank, Karachi None (Standard Chartered Bank Agreement 2/18/92) Peru Citibank, N.A., Lima Caja de Valores (CAVAL) (Citibank N.A., New York Agreement 7/16/81 New York Agreement Amendment 8/31/90) Philippines Citibank, N.A., Manila The Philippines Central Depository, (Citibank N.A., New York Agreement 7/16/81 Inc. New York Agreement Amendment 8/31/90) Poland Citibank Poland, S.A. National Depository of Securities (Citibank N.A., New York Agreement 7/16/81 New York Agreement Amendment 8/31/90 National Bank of Poland Citibank Subsidiary Amendment 10/19/95 Citibank, N.A./Citibank Poland S.A. Agt. 11/6/92) Bank Polska Kasa Opieki S.A., Warsaw Portugal Banco Espirito Santo e Comercial Central de Valores Mobiliaros de Lisboa, S.A., Lisbon (Interbolsa) (BESCL Agreement 4/26/89 Omnibus Amendment 2/23/94) Singapore Hongkong & Shanghai Banking Central Depository Pte Ltd. (CDP) Corp., Ltd., Singapore (Hongkong & Shanghai Banking Corp. Agt. 4/19/91 Omnibus Supplement 12/29/93) Slovak Republic Ceskoslovenska Obchodna Banka, S.A., Bratislava Stredisko Cennych Papeirov (SCP) (Ceskoslovenska Obchodna Banka Agmt. 10/12/94) National Bank of Slovakia South Africa First National Bank of Southern Africa Ltd., The Central Depository (Pty) Ltd. Johannesburg (CD) (First National Bank of Southern Africa Agmt. 8/7/91) South Korea Citibank, N.A., Seoul Korean Securities Depository (KSD) (Citibank N.A., New York Agreement 7/16/81 New York Agreement Amendment 8/31/90 Citibank, Seoul Agreement Supplement 10/28/94) Spain Banco Santander S.A., Madrid Servicio de Compensacion y (Banco Santander Agreement 12/14/88) Liquidacion de Valores (SCLV) Banco de Espana Sri Lanka Hongkong & Shanghai Banking Corp. Ltd., Central Depository System (Pvt) Colombo Limited (CDS) (Hongkong & Shanghai Banking Corp. Agt. 4/19/91 Omnibus Supplement 12/29/93) Swaziland Barclays Bank of Swaziland Ltd., Mbabne None (Barclays Bank Agreement 10/5/94) Sweden Skandinaviska Enskilda Banken, Stockholm Vardepappercentralen VPC AB (Skandinaviska Enskilda Banken Agreement 2/20/89 Omnibus Amendment 12/3/93) Switzerland Swiss Bank Corporation, Basel Schweizerische Effekten - Giro A.G. (Swiss Bank Corporation Agreement 3/1/94) (SEGA) Taiwan Standard Chartered Bank, Taipei Taiwan Securities Central Depository (Standard Chartered Bank Agmt. 2/18/92) Co. Ltd. (TSCD) Thailand Hongkong & Shanghai Banking Corp. Ltd., Thailand Securities Depository Bangkok Company (TSD) (Hongkong & Shanghai Banking Corp. Agmt. 4/19/91 Omnibus Amendment 12/29/93) Transnational Cedel Bank Societe Anonyme, Luxembourg Euroclear Clearance System Societe Cooperative, Belgium Turkey Citibank, N.A., Istanbul Takas ve Saklama Bankasi A.S. (TvS) (Citibank N.A., New York Agmt. 7/16/81 New York Agmt. Amendment 8/31/90) Central Bank of Turkey (CBT) United Kingdom Lloyds Bank PLC, London Central Gilts Office (CGO); CREST; Central Money Markets Office (CMO) Uruguay First National Bank of Boston, Montevideo None Venezuela Citibank, N.A., Caracas None (Citibank N.A., New York Agreement 7/16/81 New York Agreement Amendment 8/31/90) Zambia Stanbic Bank Zambia Ltd., Lusaka Lusaka Central Depository Zimbabwe Stanbic Bank Zimbabwe Ltd., Harare None Each of the Investment Companies Listed on Appendix "A" to the Custodian Agreement, on Behalf of Each of Their Respective Portfolios [Signature Lines Omitted] Exhibit 8(p) Form of Appendix "C" to the Custodian Agreement Between Each of the Investment Companies Listed on Appendix "A" Thereto And BROWN BROTHERS HARRIMAN & COMPANY Dated as of _______ PROCEDURES RELATING TO CUSTODIAN'S SECURITY INTEREST As security for any Overdrafts (as defined in the Custodian Agreement) of any Portfolio, the applicable Fund, on behalf of such Portfolio, shall pledge, assign and grant to the Custodian a security interest in Collateral (as hereinafter defined), under the terms, circumstances and conditions set forth in this Appendix "C". Section 1. Defined Terms. As used in this Appendix "C" the following terms shall have the following respective meanings: (a) "Business Day" shall mean any day that is not a Saturday, a Sunday or a day on which the Custodian is closed for business. (b) "Collateral" shall mean, with respect to any Portfolio, securities held by the Custodian on behalf of the Portfolio having a fair market value (as determined in accordance with the procedures set forth in the prospectus for the Portfolio) equal to the aggregate of all Overdraft Obligations of such Portfolio: (i) identified in any Pledge Certificate executed on behalf of such Portfolio; or (ii) designated by the Custodian for such Portfolio pursuant to Section 3 of this Appendix C. Such securities shall consist of marketable securities held by the Custodian on behalf of such Portfolio or, if no such marketable securities are held by the Custodian on behalf of such Portfolio, such other securities designated by the applicable Fund in the applicable Pledge Certificate or by the Custodian pursuant to Section 3 of this Appendix C. (c) "Overdraft Obligations" shall mean, with respect to any Portfolio, the amount of any outstanding Overdraft(s) provided by the Custodian to such Portfolio together with all accrued interest thereon. (d) "Pledge Certificate" shall mean a Pledge Certificate in the form attached to this Appendix "C" as Schedule 1 executed by a duly authorized officer of the applicable Fund and delivered by such Fund to the Custodian by facsimile transmission or in such other manner as the applicable Fund and the Custodian may agree in writing. (e) "Release Certificate" shall mean a Release Certificate in the form attached to this Appendix "C" as Schedule 2 executed by a duly authorized officer of the Custodian and delivered by the Custodian to the applicable Fund by facsimile transmission or in such other manner as such Fund and the Custodian may agree in writing. (f) "Written Notice" shall mean a written notice executed by a duly authorized officer of the party delivering the notice and delivered by facsimile transmission or in such other manner as the applicable Fund and the Custodian shall agree in writing. Section 2. Pledge of Collateral. To the extent that any Overdraft Obligations of a Portfolio are not satisfied by the close of business on the first Business Day following the Business Day on which the applicable Fund receives Written Notice requesting security for such Overdraft Obligation and stating the amount of such Overdraft Obligation, the applicable Fund, on behalf of such Portfolio, shall pledge, assign and grant to the Custodian a first priority security interest, by delivering to the Custodian, a Pledge Certificate executed by such Fund on behalf of such Portfolio describing the applicable Collateral. Such Written Notice may, in the discretion of the Custodian, be included within or accompany the Overdraft Notice relating to the applicable Overdraft Obligations. Section 3. Failure to Pledge Collateral. In the event that the applicable Fund shall fail: (a) to pay, on behalf of the applicable Portfolio, the Overdraft Obligation described in such Written Notice; (b) to deliver to the Custodian a Pledge Certificate pursuant to Section 2; or (c) to identify substitute securities pursuant to Section 6 upon the sale or maturity of any securities identified as Collateral, the Custodian may, by Written Notice to the applicable Fund specify Collateral which shall secure the applicable Overdraft Obligation. Such Fund, on behalf of any applicable Portfolio, hereby pledges, assigns and grants to the Custodian a first priority security interest in any and all Collateral specified in such Written Notice; provided that such pledge, assignment and grant of security shall be deemed to be effective only upon receipt by the applicable Fund of such Written Notice. Section 4. Delivery of Additional Collateral. If at any time the Custodian shall notify a Fund by Written Notice that the fair market value of the Collateral securing any Overdraft Obligation of one of such Fund's Portfolios is less than the amount of such Overdraft Obligation, such Fund, on behalf of the applicable Portfolio, shall deliver to the Custodian, within one (1) Business Day following the Fund's receipt of such Written Notice, an additional Pledge Certificate describing additional Collateral. If such Fund shall fail to deliver such additional Pledge Certificate, the Custodian may specify Collateral which shall secure the unsecured amount of the applicable Overdraft Obligation in accordance with Section 3 of this Appendix C. Section 5. Release of Collateral. Upon payment by a Fund, on behalf of one of its Portfolios, of any Overdraft Obligation secured by the pledge of Collateral, the Custodian shall promptly deliver to such Fund a Release Certificate pursuant to which the Custodian shall release Collateral from the lien under the applicable Pledge Certificate or Written Notice pursuant to Section 3 having a fair market value equal to the amount paid by such Fund on account of such Overdraft Obligation. In addition, if at any time a Fund shall notify the Custodian by Written Notice that such Fund desires that specified Collateral be released and: (a) that the fair market value of the Collateral securing any Overdraft Obligation shall exceed the amount of such Overdraft Obligation; or (b) that the Fund has delivered a Pledge Certificate substituting Collateral for such Overdraft Obligation, the Custodian shall deliver to such Fund, within one (1) Business Day following the Custodian's receipt of such Written Notice, a Release Certificate relating to the Collateral specified in such Written Notice. Section 6. Substitution of Collateral. A Fund may substitute securities for any securities identified as Collateral by delivery to the Custodian of a Pledge Certificate executed by such Fund on behalf of the applicable Portfolio, indicating the securities pledged as Collateral. Section 7. Security for Individual Portfolios' Overdraft Obligations. The pledge of Collateral by a Fund on behalf of any of its individual Portfolios shall secure only the Overdraft Obligations of such Portfolio. In no event shall the pledge of Collateral by one of a Fund's Portfolios be deemed or considered to be security for the Overdraft Obligations of any other Portfolio of such Fund or of any other Fund. Section 8. Custodian's Remedies. Upon (a) a Fund's failure to pay any Overdraft Obligation of an applicable Portfolio within thirty (30) days after receipt by such Fund of a Written Notice demanding security therefore, and (b) one (1) Business Day's prior Written Notice to such Fund, the Custodian may elect to enforce its security interest in the Collateral securing such Overdraft Obligation, by taking title to (at the then prevailing fair market value), or selling in a commercially reasonable manner, so much of the Collateral as shall be required to pay such Overdraft Obligation in full. Notwithstanding the provisions of any applicable law, including, without limitation, the Uniform Commercial Code, the remedy set forth in the preceding sentence shall be the only right or remedy to which the Custodian is entitled with respect to the pledge and security interest granted pursuant to any Pledge Certificate or Section 3. Without limiting the foregoing, the Custodian hereby waives and relinquishes all contractual and common law rights of set off to which it may now or hereafter be or become entitled with respect to any obligations of any Fund to the Custodian arising under this Appendix "C" to the Agreement. IN WITNESS WHEREOF, each of the parties has caused this Appendix to be executed in its name and behalf on the day and year first above written. Each of the Investment Companies Listed on BROWN BROTHERS HARRIMAN & Schedule "A" to the Custodian Agreement, on COMPANY Behalf of Each of Their Respective Portfolios [Signature lines omitted] SCHEDULE 1 TO APPENDIX "C" PLEDGE CERTIFICATE This Pledge Certificate is delivered pursuant to the Custodian Agreement dated as of [ ] (the "Agreement"), between [ ] (the "Fund") and [ ] (the "Custodian"). Capitalized terms used herein without definition shall have the respective meanings ascribed to them in the Agreement. Pursuant to [Section 2 or Section 4] of Appendix "C" attached to the Agreement, the Fund, on behalf of [ ] (the "Portfolio"), hereby pledges, assigns and grants to the Custodian a first priority security interest in the securities listed on Exhibit "A" attached to this Pledge Certificate (collectively, the "Pledged Securities"). Upon delivery of this Pledge Certificate, the Pledged Securities shall constitute Collateral, and shall secure all Overdraft Obligations of the Portfolio described in that certain Written Notice dated , 19 , delivered by the Custodian to the Fund. The pledge, assignment and grant of security in the Pledged Securities hereunder shall be subject in all respect to the terms and conditions of the Agreement, including, without limitation, Sections 7 and 8 of Appendix "C" attached thereto. IN WITNESS WHEREOF, the Fund has caused this Pledge Certificate to be executed in its name, on behalf of the Portfolio this day of 19 . [FUND], on Behalf of [Portfolio] By: ___________________ Name: ___________________ Title: ___________________ EXHIBIT "A" TO PLEDGE CERTIFICATE Type of Certificate/CUSIP Number of Issuer Security Numbers Shares SCHEDULE 2 TO APPENDIX "C" RELEASE CERTIFICATE This Release Certificate is delivered pursuant to the Custodian Agreement dated as of [ ] (the "Agreement"), between [ ] (the "Fund") and [ ] (the "Custodian"). Capitalized terms used herein without definition shall have the respective meanings ascribed to them in the Agreement. Pursuant to Section 5 of Appendix "C" attached to the Agreement, the Custodian hereby releases the securities listed on Exhibit "A" attached to this Release Certificate from the lien under the [Pledge Certificate dated ___________, 19 or the Written Notice delivered pursuant to Section 3 of Appendix "C" dated _________, 19 ]. IN WITNESS WHEREOF, the Custodian has caused this Release Certificate to be executed in its name and on its behalf this day of 19 . BROWN BROTHERS HARRIMAN & COMPANY By: _____________________ Name: _____________________ Title: _____________________ EXHIBIT "A" TO RELEASE CERTIFICATE Type of Certificate/CUSIP Number of Issuer Security Numbers Shares EX-99.B8 16 Exhibit 8(q) CUSTODIAN AGREEMENT Dated as of: ___________ Between Each of the Investment Companies Listed on Appendix "A" Attached Hereto and The Chase Manhattan Bank, N.A. TABLE OF CONTENTS ARTICLE Page I. APPOINTMENT OF CUSTODIAN 1 II. POWERS AND DUTIES OF CUSTODIAN 1 2.01 Safekeeping 1 2.02 Manner of Holding Securities 1 2.03 Security Purchases 2 2.04 Exchanges of Securities 2 2.05 Sales of Securities 2 2.06 Depositary Receipts 3 2.07 Exercise of Rights; Tender Offers 3 2.08 Stock Dividends, Rights, Etc. 3 2.09 Options 3 2.10 Futures Contracts 4 2.11 Borrowing 4 2.12 Interest Bearing Deposits 4 2.13 Foreign Exchange Transactions 5 2.14 Securities Loans 5 2.15 Collections 5 2.16 Dividends, Distributions and Redemptions 6 2.17 Proceeds from Shares Sold 6 2.18 Proxies, Notices, Etc. 6 2.19 Bills and Other Disbursements 6 2.20 Nondiscretionary Functions 6 2.21 Bank Accounts 7 2.22 Deposit of Fund Assets in Securities Systems 7 2.23 Other Transfers 8 2.24 Establishment of Segregated Account 8 2.25 Custodian's Books and Records . 8 2.26 Opinion of Fund's Independent Certified Public Accountants 9 2.27 Reports of Independent Certified Public Accountants 9 2.28 Overdraft Facility 9 III. PROPER INSTRUCTIONS, SPECIAL INSTRUCTIONS AND RELATED MATTERS 10 3.01 Proper Instructions and Special Instructions 10 3.02 Authorized Persons 10 3.03 Persons Having Access to Assets of the Portfolios 11 3.04 Actions of the Custodian Based on Proper Instructions and Special Instructions 11 IV. SUBCUSTODIANS 11 4.01 Domestic Subcustodians 11 4.02 Foreign Subcustodians and Interim Subcustodians 11 4.03 Special Subcustodians 12 4.04 Termination of a Subcustodian 13 4.05 Certification Regarding Foreign Subcustodians 13 V. STANDARD OF CARE; INDEMNIFICATION 13 5.01 Standard of Care 13 5.02 Liability of Custodian for Actions of Other Persons 14 5.03 Indemnification 15 5.04 Investment Limitations 15 5.05 Fund's Right to Proceed 16 VI. COMPENSATION 16 VII. TERMINATION 16 7.01 Termination of Agreement in Full 16 7.02 Termination as to One or More Portfolios 17 VIII. DEFINED TERMS 17 IX. MISCELLANEOUS 18 9.01 Execution of Documents, Etc 18 9.02 Representative Capacity; Nonrecourse Obligations 18 9.03 Several Obligations of the Portfolios 18 9.04 Representations and Warranties 18 9.05 Entire Agreement 19 9.06 Waivers and Amendments 19 9.07 Interpretation 19 9.08 Captions 20 9.09 Governing Law 20 9.10 Notices 20 9.11 Assignment 20 9.12 Counterparts 20 9.13 Confidentiality; Survival of Obligations 20 APPENDICES Appendix "A" - List of Portfolios Appendix "B" - List of Foreign Subcustodians and Special Subcustodians Appendix "C" - Procedures Relating to Custodian's Security Interest Exhibit 8(q) FORM OF CUSTODIAN AGREEMENT AGREEMENT made as of the_________of___________between each of the Investment Companies Listed on Appendix "A" hereto, as the same may be amended from time to time (each a "Fund" and collectively the "Funds") and The Chase Manhattan Bank, N.A. (the "Custodian"). W I T N E S S E T H WHEREAS, each Fund is or may be organized with one or more series of shares, each of which shall represent an interest in a separate portfolio of cash, securities and other assets (all such existing and additional series now or hereafter listed on Appendix "A" being hereinafter referred to individually, as a "Portfolio," and collectively, as the "Portfolios"); and WHEREAS, each Fund desires to appoint the Custodian as custodian on behalf of each of its Portfolios in accordance with the provisions of the Investment Company Act of 1940, as amended (the "1940 Act"), and the rules and regulations thereunder, under the terms and conditions set forth in this Agreement, and the Custodian has agreed so to act as custodian. NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained, the parties hereto agree as follows: ARTICLE I APPOINTMENT OF CUSTODIAN On behalf of each of its Portfolios, each Fund hereby employs and appoints the Custodian as a custodian, subject to the terms and provisions of this Agreement. Each Fund shall deliver to the Custodian, or shall cause to be delivered to the Custodian, cash, securities and other assets owned by each of its Portfolios from time to time during the term of this Agreement and shall specify to which of its Portfolios such cash, securities and other assets are to be specifically allocated. ARTICLE II POWERS AND DUTIES OF CUSTODIAN As custodian, the Custodian shall have and perform the powers and duties set forth in this Article II. Pursuant to and in accordance with Article IV hereof, the Custodian may appoint one or more Subcustodians (as hereinafter defined) to exercise the powers and perform the duties of the Custodian set forth in this Article II and references to the Custodian in this Article II shall include any Subcustodian so appointed. Section 2.01. Safekeeping. The Custodian shall keep safely all cash, securities and other assets of each Fund's Portfolios delivered to the Custodian and, on behalf of such Portfolios, the Custodian shall, from time to time, accept delivery of cash, securities and other assets for safekeeping. Section 2.02. Manner of Holding Securities. (a) The Custodian shall at all times hold securities of each Fund's Portfolios either: (i) by physical possession of the share certificates or other instruments representing such securities in registered or bearer form; or (ii) in book-entry form by a Securities System (as hereinafter defined) in accordance with the provisions of Section 2.22 below. (b) The Custodian shall at all times hold registered securities of each Portfolio in the name of the Custodian, the Portfolio or a nominee of either of them, unless specifically directed by Proper Instructions to hold such registered securities in so-called street name; provided that, in any event, all such securities and other assets shall be held in an account of the Custodian containing only assets of a Portfolio, or only assets held by the Custodian as a fiduciary or custodian for customers; and provided further, that the records of the Custodian shall indicate at all times the Portfolio or other customer for which such securities and other assets are held in such account and the respective interests therein. Section 2.03. Security Purchases. Upon receipt of Proper Instructions (as hereinafter defined), the Custodian shall pay for and receive securities purchased for the account of a Portfolio, provided that payment shall be made by the Custodian only upon receipt of the securities: (a) by the Custodian; (b) by a clearing corporation of a national securities exchange of which the Custodian is a member; or (c) by a Securities System. Notwithstanding the foregoing, upon receipt of Proper Instructions: (i) in the case of a repurchase agreement, the Custodian may release funds to a Securities System prior to the receipt of advice from the Securities System that the securities underlying such repurchase agreement have been transferred by book-entry into the Account (as hereinafter defined) maintained with such Securities System by the Custodian, provided that the Custodian's instructions to the Securities System require that the Securities System may make payment of such funds to the other party to the repurchase agreement only upon transfer by book-entry of the securities underlying the repurchase agreement into the Account; (ii) in the case of time deposits, call account deposits, currency deposits, and other deposits, foreign exchange transactions, futures contracts or options, pursuant to Sections 2.09, 2.10, 2.12 and 2.13 hereof, the Custodian may make payment therefor before receipt of an advice or confirmation evidencing said deposit or entry into such transaction; (iii) in the case of the purchase of securities, the settlement of which occurs outside of the United States of America, the Custodian may make payment therefor and receive delivery of such securities in accordance with local custom and practice generally accepted by Institutional Clients (as hereinafter defined) in the country in which the settlement occurs, but in all events subject to the standard of care set forth in Article V hereof; and (iv) in the case of the purchase of securities in which, in accordance with standard industry custom and practice generally accepted by Institutional Clients with respect to such securities, the receipt of such securities and the payment therefor take place in different countries, the Custodian may receive delivery of such securities and make payment therefor in accordance with standard industry custom and practice for such securities generally accepted by Institutional Clients, but in all events subject to the standard of care set forth in Article V hereof. For purposes of this Agreement, an "Institutional Client" shall mean a major commercial bank, corporation, insurance company, or substantially similar institution, which, as a substantial part of its business operations, purchases or sells securities and makes use of custodial services. Section 2.04. Exchanges of Securities. Upon receipt of Proper Instructions, the Custodian shall exchange securities held by it for the account of a Portfolio for other securities in connection with any reorganization, recapitalization, split-up of shares, change of par value, conversion or other event relating to the securities or the issuer of such securities, and shall deposit any such securities in accordance with the terms of any reorganization or protective plan. The Custodian shall, without receiving Proper Instructions: surrender securities in temporary form for definitive securities; surrender securities for transfer into the name of the Custodian, a Portfolio or a nominee of either of them, as permitted by Section 2.02(b); and surrender securities for a different number of certificates or instruments representing the same number of shares or same principal amount of indebtedness, provided that the securities to be issued will be delivered to the Custodian or a nominee of the Custodian. Section 2.05. Sales of Securities. Upon receipt of Proper Instructions, the Custodian shall make delivery of securities which have been sold for the account of a Portfolio, but only against payment therefor in the form of: (a) cash, certified check, bank cashier's check, bank credit, or bank wire transfer; (b) credit to the account of the Custodian with a clearing corporation of a national securities exchange of which the Custodian is a member; or (c) credit to the Account of the Custodian with a Securities System, in accordance with the provisions of Section 2.22 hereof. Notwithstanding the foregoing: (i) in the case of the sale of securities, the settlement of which occurs outside of the United States of America, such securities shall be delivered and paid for in accordance with local custom and practice generally accepted by Institutional Clients in the country in which the settlement occurs, but in all events subject to the standard of care set forth in Article V hereof; (ii) in the case of the sale of securities in which, in accordance with standard industry custom and practice generally accepted by Institutional Clients with respect to such securities, the delivery of such securities and receipt of payment therefor take place in different countries, the Custodian may deliver such securities and receive payment therefor in accordance with standard industry custom and practice for such securities generally accepted by Institutional Clients, but in all events subject to the standard of care set forth in Article V hereof; and (iii) in the case of securities held in physical form, such securities shall be delivered and paid for in accordance with "street delivery custom" to a broker or its clearing agent, against delivery to the Custodian of a receipt for such securities, provided that the Custodian shall have taken reasonable steps to ensure prompt collection of the payment for, or the return of, such securities by the broker or its clearing agent, and provided further that the Custodian shall not be responsible for the selection of or the failure or inability to perform of such broker or its clearing agent. Section 2.06. Depositary Receipts. Upon receipt of Proper Instructions, the Custodian shall surrender securities to the depositary used for such securities by an issuer of American Depositary Receipts or International Depositary Receipts (hereinafter referred to, collectively, as "ADRs"), against a written receipt therefor adequately describing such securities and written evidence satisfactory to the Custodian that the depositary has acknowledged receipt of instructions to issue ADRs with respect to such securities in the name of the Custodian or a nominee of the Custodian, for delivery to the Custodian at such place as the Custodian may from time to time designate. Upon receipt of Proper Instructions, the Custodian shall surrender ADRs to the issuer thereof, against a written receipt therefor adequately describing the ADRs surrendered and written evidence satisfactory to the Custodian that the issuer of the ADRs has acknowledged receipt of instructions to cause its depository to deliver the securities underlying such ADRs to the Custodian. Section 2.07. Exercise of Rights; Tender Offers. Upon receipt of Proper Instructions, the Custodian shall: (a) deliver warrants, puts, calls, rights or similar securities to the issuer or trustee thereof, or to the agent of such issuer or trustee, for the purpose of exercise or sale, provided that the new securities, cash or other assets, if any, acquired as a result of such actions are to be delivered to the Custodian; and (b) deposit securities upon invitations for tenders thereof, provided that the consideration for such securities is to be paid or delivered to the Custodian, or the tendered securities are to be returned to the Custodian. Notwithstanding any provision of this Agreement to the contrary, the Custodian shall take all necessary action, unless otherwise directed to the contrary in Proper Instructions, to comply with the terms of all mandatory or compulsory exchanges, calls, tenders, redemptions, or similar rights of security ownership, and shall promptly notify each applicable Fund of such action in writing by facsimile transmission or in such other manner as such Fund and the Custodian may agree in writing. Section 2.08. Stock Dividends, Rights, Etc. The Custodian shall receive and collect all stock dividends, rights and other items of like nature and, upon receipt of Proper Instructions, take action with respect to the same as directed in such Proper Instructions. Section 2.09. Options. Upon receipt of Proper Instructions and in accordance with the provisions of any agreement between the Custodian, any registered broker-dealer and, if necessary, a Fund on behalf of any applicable Portfolio relating to compliance with the rules of the Options Clearing Corporation or of any registered national securities exchange or similar organization(s), the Custodian shall: (a) receive and retain confirmations or other documents, if any, evidencing the purchase or writing of an option on a security or securities index by the applicable Portfolio; (b) deposit and maintain in a segregated account, securities (either physically or by book-entry in a Securities System), cash or other assets; and (c) pay, release and/or transfer such securities, cash or other assets in accordance with notices or other communications evidencing the expiration, termination or exercise of such options furnished by the Options Clearing Corporation, the securities or options exchange on which such options are traded, or such other organization as may be responsible for handling such option transactions. Each Fund, on behalf of its applicable Portfolios, and the broker-dealer shall be responsible for the sufficiency of assets held in any segregated account established in compliance with applicable margin maintenance requirements and the performance of other terms of any option contract. Section 2.10. Futures Contracts. Upon receipt of Proper Instructions, or pursuant to the provisions of any futures margin procedural agreement among a Fund, on behalf of any applicable Portfolio, the Custodian and any futures commission merchant (a "Procedural Agreement"), the Custodian shall: (a) receive and retain confirmations, if any, evidencing the purchase or sale of a futures contract or an option on a futures contract by the applicable Portfolio; (b) deposit and maintain in a segregated account, cash, securities and other assets designated as initial, maintenance or variation "margin" deposits intended to secure the applicable Portfolio's performance of its obligations under any futures contracts purchased or sold or any options on futures contracts written by the Portfolio, in accordance with the provisions of any Procedural Agreement designed to comply with the rules of the Commodity Futures Trading Commission and/or any commodity exchange or contract market (such as the Chicago Board of Trade), or any similar organization(s), regarding such margin deposits; and (c) release assets from and/or transfer assets into such margin accounts only in accordance with any such Procedural Agreements. Each Fund, on behalf of its applicable Portfolios, and such futures commission merchant shall be responsible for the sufficiency of assets held in the segregated account in compliance with applicable margin maintenance requirements and the performance of any futures contract or option on a futures contract in accordance with its terms. Section 2.11. Borrowing. Upon receipt of Proper Instructions, the Custodian shall deliver securities of a Portfolio to lenders or their agents, or otherwise establish a segregated account as agreed to by the applicable Fund on behalf of such Portfolio and the Custodian, as collateral for borrowings effected by such Portfolio, provided that such borrowed money is payable by the lender (a) to or upon the Custodian's order, as Custodian for such Portfolio, and (b) concurrently with delivery of such securities. Section 2.12. Interest Bearing Deposits. Upon receipt of Proper Instructions directing the Custodian to purchase interest bearing fixed term and call deposits (hereinafter referred to collectively, as "Interest Bearing Deposits") for the account of a Portfolio, the Custodian shall purchase such Interest Bearing Deposits in the name of the Portfolio with such banks or trust companies (including the Custodian, any Subcustodian or any subsidiary or affiliate of the Custodian) (hereinafter referred to as "Banking Institutions") and in such amounts as the applicable Fund may direct pursuant to Proper Instructions. Such Interest Bearing Deposits may be denominated in U.S. Dollars or other currencies, as the applicable Fund on behalf of its Portfolio may determine and direct pursuant to Proper Instructions. The Custodian shall include in its records with respect to the assets of each Portfolio appropriate notation as to the amount and currency of each such Interest Bearing Bank Deposit, the accepting Banking Institution and all other appropriate details, and shall retain such forms of advice or receipt evidencing such account, if any, as may be forwarded to the Custodian by the Banking Institution. The responsibilities of the Custodian to each Fund for Interest Bearing Deposits accepted on the Custodian's books in the United States on behalf of the Fund's Portfolios shall be that of a U.S. bank for a similar deposit. With respect to Interest Bearing Deposits other than those accepted on the Custodian's books, (a) the Custodian shall be responsible for the collection of income as set forth in Section 2.15 and the transmission of cash and instructions to and from such accounts; and (b) the Custodian shall have no duty with respect to the selection of the Banking Institution or, so long as the Custodian acts in accordance with Proper Instructions, for the failure of such Banking Institution to pay upon demand. Upon receipt of Proper Instructions, the Custodian shall take such reasonable actions as the applicable Fund deems necessary or appropriate to cause each such Interest Bearing Deposit Account to be insured to the maximum extent possible by all applicable deposit insurers including, without limitation, the Federal Deposit Insurance Corporation. Section 2.13. Foreign Exchange Transactions (a) Foreign Exchange Transactions Other Than as Principal. Upon receipt of Proper Instructions, the Custodian shall settle foreign exchange contracts or options to purchase and sell foreign currencies for spot and future delivery on behalf of and for the account of a Portfolio with such currency brokers or Banking Institutions as the applicable Fund may determine and direct pursuant to Proper Instructions. The Custodian shall be responsible for the transmission of cash and instructions to and from the currency broker or Banking Institution with which the contract or option is made, the safekeeping of all certificates and other documents and agreements evidencing or relating to such foreign exchange transactions and the maintenance of proper records as set forth in Section 2.25. The Custodian shall have no duty with respect to the selection of the currency brokers or Banking Institutions with which a Fund deals on behalf of its Portfolios or, so long as the Custodian acts in accordance with Proper Instructions, for the failure of such brokers or Banking Institutions to comply with the terms of any contract or option. (b) Foreign Exchange Contracts as Principal. The Custodian shall not be obligated to enter into foreign exchange transactions as principal. However, if the Custodian has made available to a Fund its services as a principal in foreign exchange transactions, upon receipt of Proper Instructions, the Custodian shall enter into foreign exchange contracts or options to purchase and sell foreign currencies for spot and future delivery on behalf of and for the account of a Portfolio of such Fund with the Custodian as principal. The Custodian shall be responsible for the selection of the currency brokers or Banking Institutions and the failure of such currency brokers or Banking Institutions to comply with the terms of any contract or option. (c) Payments. Notwithstanding anything to the contrary contained herein, upon receipt of Proper Instructions the Custodian may, in connection with a foreign exchange contract, make free outgoing payments of cash in the form of U.S. Dollars or foreign currency prior to receipt of confirmation of such foreign exchange contract or confirmation that the countervalue currency completing such contract has been delivered or received. Section 2.14. Securities Loans. Upon receipt of Proper Instructions, the Custodian shall, in connection with loans of securities by a Portfolio, deliver securities of such Portfolio to the borrower thereof prior to receipt of the collateral, if any, for such borrowing; provided that, in cases of loans of securities secured by cash collateral, the Custodian's instructions to the Securities System shall require that the Securities System deliver the securities of the Portfolio to the borrower thereof only upon receipt of the collateral for such borrowing. Section 2.15. Collections. The Custodian shall, and shall cause any Subcustodian to: (a) collect amounts due and payable to each Fund with respect to portfolio securities and other assets of each of such Fund's Portfolios; (b) promptly credit to the account of each applicable Portfolio all income and other payments relating to portfolio securities and other assets held by the Custodian hereunder upon Custodian's receipt of such income or payments or as otherwise agreed in writing by the Custodian and the applicable Fund; (c) promptly endorse and deliver any instruments required to effect such collections; (d) promptly execute ownership and other certificates and affidavits for all federal, state and foreign tax purposes in connection with receipt of income, capital gains or other payments with respect to portfolio securities and other assets of each applicable Portfolio, or in connection with the purchase, sale or transfer of such securities or other assets; and (e) promptly file any certificates or other affidavits for the refund or reclaim of foreign taxes paid, and promptly notify each applicable Fund of any changes to law, interpretative rulings or procedures regarding such reclaims, and otherwise use all available measures customarily used to minimize the imposition of foreign taxes at source, and promptly inform each applicable Fund of alternative means of minimizing such taxes of which the Custodian shall become aware (or with the exercise of reasonable care should have become aware); provided, however, that with respect to portfolio securities registered in so-called street name, the Custodian shall use its best efforts to collect amounts due and payable to each Fund with respect to its Portfolios. The Custodian shall promptly notify each applicable Fund in writing by facsimile transmission or in such other manner as each such Fund and the Custodian may agree in writing if any amount payable with respect to portfolio securities or other assets of the Portfolios of such Fund(s) is not received by the Custodian when due. The Custodian shall not be responsible for the collection of amounts due and payable with respect to portfolio securities or other assets that are in default. Section 2.16. Dividends, Distributions and Redemptions. The Custodian shall promptly release funds or securities: (a) upon receipt of Proper Instructions, to one or more Distribution Accounts designated by the applicable Fund or Funds in such Proper Instructions; or (b) upon receipt of Special Instructions, as otherwise directed by the applicable Fund or Funds, for the purpose of the payment of dividends or other distributions to shareholders of each applicable Portfolio, and payment to shareholders who have requested repurchase or redemption of their shares of the Portfolio(s) (collectively, the "Shares"). For purposes of this Agreement, a "Distribution Account" shall mean an account established at a Banking Institution designated by the applicable Fund on behalf of one or more of its Portfolios in Special Instructions. Section 2.17. Proceeds from Shares Sold. The Custodian shall receive funds representing cash payments received for Shares issued or sold from time to time by the Funds, and shall promptly credit such funds to the account(s) of the applicable Portfolio(s). The Custodian shall promptly notify each applicable Fund of Custodian's receipt of cash in payment for Shares issued by such Fund by facsimile transmission or in such other manner as the Fund and Custodian may agree in writing. Upon receipt of Proper Instructions, the Custodian shall: (a) deliver all federal funds received by the Custodian in payment for Shares in payment for such investments as may be set forth in such Proper Instructions and at a time agreed upon between the Custodian and the applicable Fund; and (b) make federal funds available to the applicable Fund as of specified times agreed upon from time to time by the applicable Fund and the Custodian, in the amount of checks received in payment for Shares which are deposited to the accounts of each applicable Portfolio. Section 2.18. Proxies, Notices, Etc. The Custodian shall deliver to each applicable Fund, in the most expeditious manner practicable, all forms of proxies, all notices of meetings, and any other notices or announcements affecting or relating to securities owned by one or more of the applicable Fund's Portfolios that are received by the Custodian, any Subcustodian, or any nominee of either of them, and, upon receipt of Proper Instructions, the Custodian shall execute and deliver, or cause such Subcustodian or nominee to execute and deliver, such proxies or other authorizations as may be required. Except as directed pursuant to Proper Instructions, neither the Custodian nor any Subcustodian or nominee shall vote upon any such securities, or execute any proxy to vote thereon, or give any consent or take any other action with respect thereto. Section 2.19. Bills and Other Disbursements. Upon receipt of Proper Instructions, the Custodian shall pay or cause to be paid, all bills, statements, or other obligations of each Portfolio. Section 2.20. Nondiscretionary Functions. The Custodian shall attend to all nondiscretionary details in connection with the sale, exchange, substitution, purchase, transfer or other dealings with securities or other assets of each Portfolio held by the Custodian, except as otherwise directed from time to time pursuant to Proper Instructions. Section 2.21. Bank Accounts (a) Accounts with the Custodian and any Subcustodians. The Custodian shall open and operate a bank account or accounts (hereinafter referred to collectively, as "Bank Accounts") on the books of the Custodian or any Subcustodian provided that such account(s) shall be in the name of the Custodian or a nominee of the Custodian, for the account of a Portfolio, and shall be subject only to the draft or order of the Custodian; provided however, that such Bank Accounts in countries other than the United States may be held in an account of the Custodian containing only assets held by the Custodian as a fiduciary or custodian for customers, and provided further, that the records of the Custodian shall indicate at all times the Portfolio or other customer for which such securities and other assets are held in such account and the respective interests therein. Such Bank Accounts may be denominated in either U.S. Dollars or other currencies. The responsibilities of the Custodian to each applicable Fund for deposits accepted on the Custodian's books in the United States shall be that of a U.S. bank for a similar deposit. The responsibilities of the Custodian to each applicable Fund for deposits accepted on any Subcustodian's books shall be governed by the provisions of Section 5.02. (b) Accounts With Other Banking Institutions. The Custodian may open and operate Bank Accounts on behalf of a Portfolio, in the name of the Custodian or a nominee of the Custodian, at a Banking Institution other than the Custodian or any Subcustodian, provided that such account(s) shall be in the name of the Custodian or a nominee of the Custodian, for the account of a Portfolio, and shall be subject only to the draft or order of the Custodian; provided however, that such Bank Accounts may be held in an account of the Custodian containing only assets held by the Custodian as a fiduciary or custodian for customers, and provided further, that the records of the Custodian shall indicate at all times the Portfolio or other customer for which such securities and other assets are held in such account and the respective interests therein. Such Bank Accounts may be denominated in either U.S. Dollars or other currencies. Subject to the provisions of Section 5.01(a), the Custodian shall be responsible for the selection of the Banking Institution and for the failure of such Banking Institution to pay according to the terms of the deposit. (c) Deposit Insurance. Upon receipt of Proper Instructions, the Custodian shall take such reasonable actions as the applicable Fund deems necessary or appropriate to cause each deposit account established by the Custodian pursuant to this Section 2.21 to be insured to the maximum extent possible by all applicable deposit insurers including, without limitation, the Federal Deposit Insurance Corporation. Section 2.22. Deposit of Fund Assets in Securities Systems. The Custodian may deposit and/or maintain domestic securities owned by a Portfolio in: (a) The Depository Trust Company; (b) the Participants Trust Company; (c) any book-entry system as provided in (i) Subpart O of Treasury Circular No. 300, 31 CFR 306.115, (ii) Subpart B of Treasury Circular Public Debt Series No. 27-76, 31 CFR 350.2, or (iii) the book-entry regulations of federal agencies substantially in the form of 31 CFR 306.115; or (d) any other domestic clearing agency registered with the Securities and Exchange Commission ("SEC") under Section 17A of the Securities Exchange Act of 1934 (or as may otherwise be authorized by the Securities and Exchange Commission to serve in the capacity of depository or clearing agent for the securities or other assets of investment companies) which acts as a securities depository and the use of which each applicable Fund has previously approved by Special Instructions (as hereinafter defined) (each of the foregoing being referred to in this Agreement as a "Securities System"). Use of a Securities System shall be in accordance with applicable Federal Reserve Board and SEC rules and regulations, if any, and subject to the following provisions: (A) The Custodian may deposit and/or maintain securities held hereunder in a Securities System, provided that such securities are represented in an account ("Account") of the Custodian in the Securities System which Account shall not contain any assets of the Custodian other than assets held as a fiduciary, custodian, or otherwise for customers and shall be so designated on the books and records of the Securities System. (B) The Securities System shall be obligated to comply with the Custodian's directions with respect to the securities held in such Account and shall not be entitled to a lien against the assets in such Account for extensions of credit to the Custodian other than for payment of the purchase price of such assets. (C) Each Fund hereby designates the Custodian as the party in whose name any securities deposited by the Custodian in the Account are to be registered. (D) The books and records of the Custodian shall at all times identify those securities belonging to each Portfolio which are maintained in a Securities System. (E) The Custodian shall pay for securities purchased for the account of a Portfolio only upon (w) receipt of advice from the Securities System that such securities have been transferred to the Account of the Custodian, and (x) the making of an entry on the records of the Custodian to reflect such payment and transfer for the account of such Portfolio. The Custodian shall transfer securities sold for the account of a Portfolio only upon (y) receipt of advice from the Securities System that payment for such securities has been transferred to the Account of the Custodian, and (z) the making of an entry on the records of the Custodian to reflect such transfer and payment for the account of such Portfolio. Copies of all advices from the Securities System relating to transfers of securities for the account of a Portfolio shall identify such Portfolio and shall be maintained for such Portfolio by the Custodian. The Custodian shall deliver to each applicable Fund on the next succeeding business day daily transaction reports which shall include each day's transactions in the Securities System for the account of each applicable Portfolio. Such transaction reports shall be delivered to each applicable Fund or any agent designated by such Fund pursuant to Proper Instructions, by computer or in such other manner as such Fund and the Custodian may agree in writing. (F) The Custodian shall, if requested by a Fund pursuant to Proper Instructions, provide such Fund with all reports obtained by the Custodian or any Subcustodian with respect to a Securities System's accounting system, internal accounting control and procedures for safeguarding securities deposited in the Securities System. (G) Upon receipt of Special Instructions, the Custodian shall terminate the use of any Securities System (except the federal book-entry system) on behalf of any Portfolio as promptly as practicable and shall take all actions reasonably practicable to safeguard the securities of any Portfolio maintained with such Securities System. Section 2.23. Other Transfers. (a) Upon receipt of Proper Instructions, the Custodian shall transfer to or receive from a third party that has been appointed to serve as an additional custodian of one or more Portfolios (an "Additional Custodian") securities, cash and other assets of such Portfolio(s) in accordance with such Proper Instructions. Each Additional Custodian shall be identified as such on Appendix B, as the same may be amended from time to time in accordance with the provisions of Section 9.06(c). (b) Upon receipt of Special Instructions, the Custodian shall make such other dispositions of securities, funds or other property of a Portfolio in a manner or for purposes other than as expressly set forth in this Agreement, provided that the Special Instructions relating to such disposition shall include a statement of the purpose for which the delivery is to be made, the amount of funds and/or securities to be delivered, and the name of the person or persons to whom delivery is to be made, and shall otherwise comply with the provisions of Sections 3.01 and 3.03 hereof. Section 2.24. Establishment of Segregated Account. Upon receipt of Proper Instructions, the Custodian shall establish and maintain on its books a segregated account or accounts for and on behalf of a Portfolio, into which account or accounts may be transferred cash and/or securities or other assets of such Portfolio, including securities maintained by the Custodian in a Securities System pursuant to Section 2.22 hereof, said account or accounts to be maintained: (a) for the purposes set forth in Sections 2.09, 2.10 and 2.11 hereof; (b) for the purposes of compliance by the Portfolio with the procedures required by Investment Company Act Release No. 10666, or any subsequent release or releases of the SEC relating to the maintenance of segregated accounts by registered investment companies; or (c) for such other purposes as set forth, from time to time, in Special Instructions. Section 2.25. Custodian's Books and Records. The Custodian shall provide any assistance reasonably requested by a Fund in the preparation of reports to such Fund's shareholders and others, audits of accounts, and other ministerial matters of like nature. The Custodian shall maintain complete and accurate records with respect to securities and other assets held for the accounts of each Portfolio as required by the rules and regulations of the SEC applicable to investment companies registered under the 1940 Act, including: (a) journals or other records of original entry containing a detailed and itemized daily record of all receipts and deliveries of securities (including certificate and transaction identification numbers, if any), and all receipts and disbursements of cash; (b) ledgers or other records reflecting (i) securities in transfer, (ii) securities in physical possession, (iii) securities borrowed, loaned or collateralizing obligations of each Portfolio, (iv) monies borrowed and monies loaned (together with a record of the collateral therefor and substitutions of such collateral), (v) dividends and interest received, (vi) the amount of tax withheld by any person in respect of any collection made by the Custodian or any Subcustodian, and (vii) the amount of reclaims or refunds for foreign taxes paid; and (c) cancelled checks and bank records related thereto. The Custodian shall keep such other books and records of each Fund as such Fund shall reasonably request. All such books and records maintained by the Custodian shall be maintained in a form acceptable to the applicable Fund and in compliance with the rules and regulations of the SEC, including, but not limited to, books and records required to be maintained by Section 31(a) of the 1940 Act and the rules and regulations from time to time adopted thereunder. All books and records maintained by the Custodian pursuant to this Agreement shall at all times be the property of each applicable Fund and shall be available during normal business hours for inspection and use by such Fund and its agents, including, without limitation, its independent certified public accountants. Notwithstanding the preceding sentence, no Fund shall take any actions or cause the Custodian to take any actions which would cause, either directly or indirectly, the Custodian to violate any applicable laws, regulations or orders. Section 2.26. Opinion of Fund's Independent Certified Public Accountants. The Custodian shall take all reasonable action as a Fund may request to obtain from year to year favorable opinions from such Fund's independent certified public accountants with respect to the Custodian's activities hereunder in connection with the preparation of the Fund's Form N-1A and the Fund's Form N-SAR or other periodic reports to the SEC and with respect to any other requirements of the SEC. Section 2.27. Reports by Independent Certified Public Accountants. At the request of a Fund, the Custodian shall deliver to such Fund a written report prepared by the Custodian's independent certified public accountants with respect to the services provided by the Custodian under this Agreement, including, without limitation, the Custodian's accounting system, internal accounting control and procedures for safeguarding cash, securities and other assets, including cash, securities and other assets deposited and/or maintained in a Securities System or with a Subcustodian. Such report shall be of sufficient scope and in sufficient detail as may reasonably be required by any Fund and as may reasonably be obtained by the Custodian. Section 2.28. Overdraft Facility. In the event that the Custodian is directed by Proper Instructions to make any payment or transfer of funds on behalf of a Portfolio for which there would be, at the close of business on the date of such payment or transfer, insufficient funds held by the Custodian on behalf of such Portfolio, the Custodian may, in its discretion, provide an overdraft (an "Overdraft") to the applicable Fund on behalf of such Portfolio, in an amount sufficient to allow the completion of such payment. Any Overdraft provided hereunder: (a) shall be payable on the next Business Day, unless otherwise agreed by the applicable Fund and the Custodian; and (b) shall accrue interest from the date of the Overdraft to the date of payment in full by the applicable Fund on behalf of the applicable Portfolio at a rate agreed upon in writing, from time to time, by the Custodian and the applicable Fund. The Custodian and each Fund acknowledge that the purpose of such Overdrafts is to temporarily finance the purchase or sale of securities for prompt delivery in accordance with the terms hereof, or to meet emergency expenses not reasonably foreseeable by such Fund. The Custodian shall promptly notify each applicable Fund in writing (an "Overdraft Notice") of any Overdraft by facsimile transmission or in such other manner as such Fund and the Custodian may agree in writing. At the request of the Custodian, each applicable Fund, on behalf of one or more of its Portfolios, shall pledge, assign and grant to the Custodian a security interest in certain specified securities of the applicable Portfolio, as security for Overdrafts provided to such Portfolio, under the terms and conditions set forth in Appendix "C" attached hereto. ARTICLE III PROPER INSTRUCTIONS, SPECIAL INSTRUCTIONS AND RELATED MATTERS Section 3.01. Proper Instructions and Special Instructions. (a) Proper Instructions. As used herein, the term "Proper Instructions" shall mean: (i) a tested telex, a written (including, without limitation, facsimile transmission) request, direction, instruction or certification signed or initialed by or on behalf of the applicable Fund by one or more Authorized Persons (as hereinafter defined); (ii) a telephonic or other oral communication by one or more Authorized Persons; or (iii) a communication effected directly between an electro-mechanical or electronic device or system (including, without limitation, computers) by or on behalf of the applicable Fund by one or more Authorized Persons; provided, however, that communications of the types described in clauses (ii) and (iii) above purporting to be given by an Authorized Person shall be considered Proper Instructions only if the Custodian reasonably believes such communications to have been given by an Authorized Person with respect to the transaction involved. Proper Instructions in the form of oral communications shall be confirmed by the applicable Fund by tested telex or in writing in the manner set forth in clause (i) above, but the lack of such confirmation shall in no way affect any action taken by the Custodian in reliance upon such oral instructions prior to the Custodian's receipt of such confirmation. Each Fund and the Custodian are hereby authorized to record any and all telephonic or other oral instructions communicated to the Custodian. Proper Instructions may relate to specific transactions or to types or classes of transactions, and may be in the form of standing instructions. (b) Special Instructions. As used herein, the term "Special Instructions" shall mean Proper Instructions countersigned or confirmed in writing by the Treasurer or any Assistant Treasurer of the applicable Fund or any other person designated by the Treasurer of such Fund in writing, which countersignature or confirmation shall be (i) included on the same instrument containing the Proper Instructions or on a separate instrument relating thereto, and (ii) delivered by hand, by facsimile transmission, or in such other manner as the applicable Fund and the Custodian agree in writing. (c) Address for Proper Instructions and Special Instructions. Proper Instructions and Special Instructions shall be delivered to the Custodian at the address and/or telephone, telecopy or telex number agreed upon from time to time by the Custodian and the applicable Fund. Section 3.02. Authorized Persons. Concurrently with the execution of this Agreement and from time to time thereafter, as appropriate, each Fund shall deliver to the Custodian, duly certified as appropriate by a Treasurer or Assistant Treasurer of such Fund, a certificate setting forth: (a) the names, titles, signatures and scope of authority of all persons authorized to give Proper Instructions or any other notice, request, direction, instruction, certificate or instrument on behalf of such Fund (collectively, the "Authorized Persons" and individually, an "Authorized Person"); and (b) the names, titles and signatures of those persons authorized to issue Special Instructions. Such certificate may be accepted and relied upon by the Custodian as conclusive evidence of the facts set forth therein and shall be considered to be in full force and effect until delivery to the Custodian of a similar certificate to the contrary. Upon delivery of a certificate which deletes the name(s) of a person previously authorized by a Fund to give Proper Instructions or to issue Special Instructions, such persons shall no longer be considered an Authorized Person or authorized to issue Special Instructions for that Fund. Section 3.03. Persons Having Access to Assets of the Portfolios. Notwithstanding anything to the contrary contained in this Agreement, no Authorized Person, Trustee, officer, employee or agent of any Fund shall have physical access to the assets of any Portfolio of that Fund held by the Custodian nor shall the Custodian deliver any assets of a Portfolio for delivery to an account of such person; provided, however, that nothing in this Section 3.03 shall prohibit (a) any Authorized Person from giving Proper Instructions, or any person authorized to issue Special Instructions from issuing Special Instructions, so long as such action does not result in delivery of or access to assets of any Portfolio prohibited by this Section 3.03; or (b) each Fund's independent certified public accountants from examining or reviewing the assets of the Portfolios of the Fund held by the Custodian. Each Fund shall deliver to the Custodian a written certificate identifying such Authorized Persons, Trustees, officers, employees and agents of such Fund. Section 3.04. Actions of Custodian Based on Proper Instructions and Special Instructions. So long as and to the extent that the Custodian acts in accordance with (a) Proper Instructions or Special Instructions, as the case may be, and (b) the terms of this Agreement, the Custodian shall not be responsible for the title, validity or genuineness of any property, or evidence of title thereof, received by it or delivered by it pursuant to this Agreement. ARTICLE IV SUBCUSTODIANS The Custodian may, from time to time, in accordance with the relevant provisions of this Article IV, appoint one or more Domestic Subcustodians, Foreign Subcustodians, Interim Subcustodians and Special Subcustodians to act on behalf of a Portfolio. (For purposes of this Agreement, all duly appointed Domestic Subcustodians, Foreign Subcustodians, Interim Subcustodians, and Special Subcustodians are hereinafter referred to collectively, as "Subcustodians.") Section 4.01. Domestic Subcustodians. The Custodian may, at any time and from time to time, appoint any bank as defined in Section 2(a)(5) of the 1940 Act meeting the requirements of a custodian under Section 17(f) of the 1940 Act and the rules and regulations thereunder, to act on behalf of one or more Portfolios as a subcustodian for purposes of holding cash, securities and other assets of such Portfolios and performing other functions of the Custodian within the United States (a "Domestic Subcustodian"); provided, that, the Custodian shall notify each applicable Fund in writing of the identity and qualifications of any proposed Domestic Subcustodian at least thirty (30) days prior to appointment of such Domestic Subcustodian, and such Fund may, in its sole discretion, by written notice to the Custodian executed by an Authorized Person disapprove of the appointment of such Domestic Subcustodian. If, following notice by the Custodian to each applicable Fund regarding appointment of a Domestic Subcustodian and the expiration of thirty (30) days after the date of such notice, such Fund shall have failed to notify the Custodian of its disapproval thereof, the Custodian may, in its discretion, appoint such proposed Domestic Subcustodian as its subcustodian. Section 4.02. Foreign Subcustodians and Interim Subcustodians. (a) Foreign Subcustodians. The Custodian may, at any time and from time to time, appoint: (i) any bank, trust company or other entity meeting the requirements of an "eligible foreign custodian" under Section 17(f) of the 1940 Act and the rules and regulations thereunder or by order of the Securities and Exchange Commission exempted therefrom, or (ii) any bank as defined in Section 2(a)(5) of the 1940 Act meeting the requirements of a custodian under Section 17(f) of the 1940 Act and the rules and regulations thereunder to act on behalf of one or more Portfolios as a subcustodian for purposes of holding cash, securities and other assets of such Portfolios and performing other functions of the Custodian in countries other than the United States of America (a "Foreign Subcustodian"); provided, that, prior to the appointment of any Foreign Subcustodian, the Custodian shall have obtained written confirmation of the approval of the Board of Trustees or other governing body or entity of each applicable Fund on behalf of its applicable Portfolio(s) (which approval may be withheld in the sole discretion of such Board of Trustees or other governing body or entity) with respect to (i) the identity and qualifications of any proposed Foreign Subcustodian, (ii) the country or countries in which, and the securities depositories or clearing agencies, if any, through which, any proposed Foreign Subcustodian is authorized to hold securities and other assets of the applicable Portfolio(s), and (iii) the form and terms of the subcustodian agreement to be entered into between such proposed Foreign Subcustodian and the Custodian. Each such duly approved Foreign Subcustodian and the countries where and the securities depositories and clearing agencies through which they may hold securities and other assets of the applicable Portfolios shall be listed on Appendix "B" attached hereto, as it may be amended, from time to time, in accordance with the provisions of Section 9.05(c) hereof. Each Fund shall be responsible for informing the Custodian sufficiently in advance of a proposed investment by one of its Portfolios which is to be held in a country in which no Foreign Subcustodian is authorized to act, in order that there shall be sufficient time for the Custodian to effect the appropriate arrangements with a proposed foreign subcustodian, including obtaining approval as provided in this Section 4.02(a). The Custodian shall not amend any subcustodian agreement entered into with a Foreign Subcustodian, or agree to change or permit any changes thereunder, or waive any rights under such agreement, which materially affect a Fund's rights or the Foreign Subcustodian's obligations or duties to a Fund under such agreement, except upon prior approval pursuant to Special Instructions. (b) Interim Subcustodians. Notwithstanding the foregoing, in the event that a Portfolio shall invest in a security or other asset to be held in a country in which no Foreign Subcustodian is authorized to act, the Custodian shall promptly notify the applicable Fund in writing by facsimile transmission or in such other manner as such Fund and Custodian shall agree in writing of the unavailability of an approved Foreign Subcustodian in such country; and the Custodian shall, upon receipt of Special Instructions, appoint any Person designated by the applicable Fund in such Special Instructions to hold such security or other asset. (Any Person appointed as a subcustodian pursuant to this Section 4.02(b) is hereinafter referred to as an "Interim Subcustodian.") Section 4.03. Special Subcustodians. Upon receipt of Special Instructions, the Custodian shall, on behalf of one or more Portfolios, appoint one or more banks, trust companies or other entities designated in such Special Instructions to act as a subcustodian for purposes of: (i) effecting third-party repurchase transactions with banks, brokers, dealers or other entities through the use of a common custodian or subcustodian; (ii) establishing a joint trading account for the applicable Portfolio(s) and other registered open-end management investment companies for which Fidelity Management & Research Company serves as investment adviser, through which such Portfolios and such other investment companies shall collectively participate in certain repurchase transactions; (iii) providing depository and clearing agency services with respect to certain variable rate demand note securities; and (iv) effecting any other transactions designated by each applicable Fund in Special Instructions. (Each such designated subcustodian is hereinafter referred to as a "Special Subcustodian.") Each such duly appointed Special Subcustodian shall be listed on Appendix "B" attached hereto, as it may be amended from time to time in accordance with the provisions of Section 9.05(c) hereof. In connection with the appointment of any Special Subcustodian, the Custodian shall enter into a subcustodian agreement with the Special Subcustodian in form and substance approved by each applicable Fund, provided that such agreement shall in all events comply with the provisions of the 1940 Act and the rules and regulations thereunder and the terms and provisions of this Agreement. The Custodian shall not amend any subcustodian agreement entered into with a Special Subcustodian, or agree to change or permit any changes thereunder, or waive any rights under such agreement, except upon prior approval pursuant to Special Instructions. Section 4.04. Termination of a Subcustodian. The Custodian shall (i) cause each Domestic Subcustodian and Foreign Subcustodian to, and (ii) use its best efforts to cause each Interim Subcustodian and Special Subcustodian to, perform all of its obligations in accordance with the terms and conditions of the subcustodian agreement between the Custodian and such Subcustodian. In the event that the Custodian is unable to cause such Subcustodian to fully perform its obligations thereunder, the Custodian shall forthwith, upon the receipt of Special Instructions, terminate such Subcustodian with respect to each applicable Fund and, if necessary or desirable, appoint a replacement Subcustodian in accordance with the provisions of Section 4.01 or Section 4.02, as the case may be. In addition to the foregoing, the Custodian (A) may, at any time in its discretion, upon written notification to each applicable Fund, terminate any Domestic Subcustodian, Foreign Subcustodian or Interim Subcustodian, and (B) shall, upon receipt of Special Instructions, terminate any Subcustodian with respect to each applicable Fund, in accordance with the termination provisions under the applicable subcustodian agreement. Section 4.05. Certification Regarding Foreign Subcustodians. Upon request of a Fund, the Custodian shall deliver to such Fund a certificate stating: (i) the identity of each Foreign Subcustodian then acting on behalf of the Custodian for such Fund and its Portfolios; (ii) the countries in which and the securities depositories and clearing agents through which each such Foreign Subcustodian is then holding cash, securities and other assets of any Portfolio of such Fund; and (iii) such other information as may be requested by such Fund to ensure compliance with Rule 17(f)-5 under the 1940 Act. ARTICLE V STANDARD OF CARE; INDEMNIFICATION Section 5.01. Standard of Care. (a) General Standard of Care. The Custodian shall exercise reasonable care and diligence in carrying out all of its duties and obligations under this Agreement, and shall be liable to each Fund for all loss, damage and expense suffered or incurred by such Fund or its Portfolios resulting from the failure of the Custodian to exercise such reasonable care and diligence. (b) Actions Prohibited by Applicable Law, Etc. In no event shall the Custodian incur liability hereunder if the Custodian or any Subcustodian or Securities System, or any subcustodian, securities depository or securities system utilized by any such Subcustodian, or any nominee of the Custodian or any Subcustodian (individually, a "Person") is prevented, forbidden or delayed from performing, or omits to perform, any act or thing which this Agreement provides shall be performed or omitted to be performed, by reason of: (i) any provision of any present or future law or regulation or order of the United States of America, or any state thereof, or of any foreign country, or political subdivision thereof or of any court of competent jurisdiction; or (ii) any act of God or war or other similar circumstance beyond the control of the Custodian, unless, in each case, such delay or nonperformance is caused by (A) the negligence, misfeasance or misconduct of the applicable Person, or (B) a malfunction or failure of equipment operated or utilized by the applicable Person other than a malfunction or failure beyond such Person's control and which could not reasonably be anticipated and/or prevented by such Person. (c) Mitigation by Custodian. Upon the occurrence of any event which causes or may cause any loss, damage or expense to any Fund or Portfolio, (i) the Custodian shall, (ii) the Custodian shall cause any applicable Domestic Subcustodian or Foreign Subcustodian to, and (iii) the Custodian shall use its best efforts to cause any applicable Interim Subcustodian or Special Subcustodian to, use all commercially reasonable efforts and take all reasonable steps under the circumstances to mitigate the effects of such event and to avoid continuing harm to the Funds and the Portfolios. (d) Advice of Counsel. The Custodian shall be entitled to receive and act upon advice of counsel on all matters. The Custodian shall be without liability for any action reasonably taken or omitted in good faith pursuant to the advice of (i) counsel for the applicable Fund or Funds, or (ii) at the expense of the Custodian, such other counsel as the applicable Fund(s) and the Custodian may agree upon; provided, however, with respect to the performance of any action or omission of any action upon such advice, the Custodian shall be required to conform to the standard of care set forth in Section 5.01(a). (e) Expenses of the Funds. In addition to the liability of the Custodian under this Article V, the Custodian shall be liable to each applicable Fund for all reasonable costs and expenses incurred by such Fund in connection with any claim by such Fund against the Custodian arising from the obligations of the Custodian hereunder, including, without limitation, all reasonable attorneys' fees and expenses incurred by such Fund in asserting any such claim, and all expenses incurred by such Fund in connection with any investigations, lawsuits or proceedings relating to such claim; provided, that such Fund has recovered from the Custodian for such claim. (f) Liability for Past Records. The Custodian shall have no liability in respect of any loss, damage or expense suffered by a Fund, insofar as such loss, damage or expense arises from the performance of the Custodian's duties hereunder by reason of the Custodian's reliance upon records that were maintained for such Fund by entities other than the Custodian prior to the Custodian's appointment as custodian for such Fund. Section 5.02. Liability of Custodian for Actions of Other Persons. (a) Domestic Subcustodians and Foreign Subcustodians. The Custodian shall be liable for the actions or omissions of any Domestic Subcustodian or any Foreign Subcustodian to the same extent as if such action or omission were performed by the Custodian itself. In the event of any loss, damage or expense suffered or incurred by a Fund caused by or resulting from the actions or omissions of any Domestic Subcustodian or Foreign Subcustodian for which the Custodian would otherwise be liable, the Custodian shall promptly reimburse such Fund in the amount of any such loss, damage or expense. (b) Interim Subcustodians. Notwithstanding the provisions of Section 5.01 to the contrary, the Custodian shall not be liable to a Fund for any loss, damage or expense suffered or incurred by such Fund or any of its Portfolios resulting from the actions or omissions of an Interim Subcustodian unless such loss, damage or expense is caused by, or results from, the negligence, misfeasance or misconduct of the Custodian; provided, however, in the event of any such loss, damage or expense, the Custodian shall take all reasonable steps to enforce such rights as it may have against such Interim Subcustodian to protect the interests of the Funds and the Portfolios. (c) Special Subcustodians and Additional Custodians. Notwithstanding the provisions of Section 5.01 to the contrary and except as otherwise provided in any subcustodian agreement to which the Custodian, a Fund and any Special Subcustodian or Additional Custodian are parties, the Custodian shall not be liable to a Fund for any loss, damage or expense suffered or incurred by such Fund or any of its Portfolios resulting from the actions or omissions of a Special Subcustodian or Additional Subcustodian, unless such loss, damage or expense is caused by, or results from, the negligence, misfeasance or misconduct of the Custodian; provided, however, that in the event of any such loss, damage or expense, the Custodian shall take all reasonable steps to enforce such rights as it may have against any Special Subcustodian or Additional Custodian to protect the interests of the Funds and the Portfolios. (d) Securities Systems. Notwithstanding the provisions of Section 5.01 to the contrary, the Custodian shall not be liable to a Fund for any loss, damage or expense suffered or incurred by such Fund or any of its Portfolios resulting from the use by the Custodian of a Securities System, unless such loss, damage or expense is caused by, or results from, the negligence, misfeasance or misconduct of the Custodian; provided, however, that in the event of any such loss, damage or expense, the Custodian shall take all reasonable steps to enforce such rights as it may have against the Securities System to protect the interests of the Funds and the Portfolios. (e) Reimbursement of Expenses. Each Fund agrees to reimburse the Custodian for all reasonable out-of-pocket expenses incurred by the Custodian on behalf of such Fund in connection with the fulfillment of its obligations under this Section 5.02; provided, however, that such reimbursement shall not apply to expenses occasioned by or resulting from the negligence, misfeasance or misconduct of the Custodian. Section 5.03. Indemnification. (a) Indemnification Obligations. Subject to the limitations set forth in this Agreement, each Fund severally and not jointly agrees to indemnify and hold harmless the Custodian and its nominees from all loss, damage and expense (including reasonable attorneys' fees) suffered or incurred by the Custodian or its nominee caused by or arising from actions taken by the Custodian on behalf of such Fund in the performance of its duties and obligations under this Agreement; provided, however, that such indemnity shall not apply to loss, damage and expense occasioned by or resulting from the negligence, misfeasance or misconduct of the Custodian or its nominee. In addition, each Fund agrees severally and not jointly to indemnify any Person against any liability incurred by reason of taxes assessed to such Person, or other loss, damage or expenses incurred by such Person, resulting from the fact that securities and other property of such Fund's Portfolios are registered in the name of such Person; provided, however, that in no event shall such indemnification be applicable to income, franchise or similar taxes which may be imposed or assessed against any Person. (b) Notice of Litigation, Right to Prosecute, Etc. No Fund shall be liable for indemnification under this Section 5.03 unless a Person shall have promptly notified such Fund in writing of the commencement of any litigation or proceeding brought against such Person in respect of which indemnity may be sought under this Section 5.03. With respect to claims in such litigation or proceedings for which indemnity by a Fund may be sought and subject to applicable law and the ruling of any court of competent jurisdiction, such Fund shall be entitled to participate in any such litigation or proceeding and, after written notice from such Fund to any Person, such Fund may assume the defense of such litigation or proceeding with counsel of its choice at its own expense in respect of that portion of the litigation for which such Fund may be subject to an indemnification obligation; provided, however, a Person shall be entitled to participate in (but not control) at its own cost and expense, the defense of any such litigation or proceeding if such Fund has not acknowledged in writing its obligation to indemnify the Person with respect to such litigation or proceeding. If such Fund is not permitted to participate or control such litigation or proceeding under applicable law or by a ruling of a court of competent jurisdiction, such Person shall reasonably prosecute such litigation or proceeding. A Person shall not consent to the entry of any judgment or enter into any settlement in any such litigation or proceeding without providing each applicable Fund with adequate notice of any such settlement or judgment, and without each such Fund's prior written consent. All Persons shall submit written evidence to each applicable Fund with respect to any cost or expense for which they are seeking indemnification in such form and detail as such Fund may reasonably request. Section 5.04. Investment Limitations. If the Custodian has otherwise complied with the terms and conditions of this Agreement in performing its duties generally, and more particularly in connection with the purchase, sale or exchange of securities made by or for a Portfolio, the Custodian shall not be liable to the applicable Fund and such Fund agrees to indemnify the Custodian and its nominees, for any loss, damage or expense suffered or incurred by the Custodian and its nominees arising out of any violation of any investment or other limitation to which such Fund is subject. Section 5.05. Fund's Right to Proceed. Notwithstanding anything to the contrary contained herein, each Fund shall have, at its election upon reasonable notice to the Custodian, the right to enforce, to the extent permitted by any applicable agreement and applicable law, the Custodian's rights against any Subcustodian, Securities System, or other Person for loss, damage or expense caused such Fund by such Subcustodian, Securities System, or other Person, and shall be entitled to enforce the rights of the Custodian with respect to any claim against such Subcustodian, Securities System or other Person, which the Custodian may have as a consequence of any such loss, damage or expense, if and to the extent that such Fund has not been made whole for any such loss or damage. If the Custodian makes such Fund whole for any such loss or damage, the Custodian shall retain the ability to enforce its rights directly against such Subcustodian, Securities System or other Person. Upon such Fund's election to enforce any rights of the Custodian under this Section 5.05, such Fund shall reasonably prosecute all actions and proceedings directly relating to the rights of the Custodian in respect of the loss, damage or expense incurred by such Fund; provided that, so long as such Fund has acknowledged in writing its obligation to indemnify the Custodian under Section 5.03 hereof with respect to such claim, such Fund shall retain the right to settle, compromise and/or terminate any action or proceeding in respect of the loss, damage or expense incurred by such Fund without the Custodian's consent and provided further, that if such Fund has not made an acknowledgement of its obligation to indemnify, such Fund shall not settle, compromise or terminate any such action or proceeding without the written consent of the Custodian, which consent shall not be unreasonably withheld or delayed. The Custodian agrees to cooperate with each Fund and take all actions reasonably requested by such Fund in connection with such Fund's enforcement of any rights of the Custodian. Each Fund agrees to reimburse the Custodian for all reasonable out-of-pocket expenses incurred by the Custodian on behalf of such Fund in connection with the fulfillment of its obligations under this Section 5.05; provided, however, that such reimbursement shall not apply to expenses occasioned by or resulting from the negligence, misfeasance or misconduct of the Custodian. ARTICLE VI COMPENSATION On behalf of each of its Portfolios, each Fund shall compensate the Custodian in an amount, and at such times, as may be agreed upon in writing, from time to time, by the Custodian and such Fund. ARTICLE VII TERMINATION Section 7.01. Termination of Agreement as to One or More Funds. With respect to each Fund, this Agreement shall continue in full force and effect until the first to occur of: (a) termination by the Custodian by an instrument in writing delivered or mailed to such Fund, such termination to take effect not sooner than ninety (90) days after the date of such delivery; (b) termination by such Fund by an instrument in writing delivered or mailed to the Custodian, such termination to take effect not sooner than thirty (30) days after the date of such delivery; or (c) termination by such Fund by written notice delivered to the Custodian, based upon such Fund's determination that there is a reasonable basis to conclude that the Custodian is insolvent or that the financial condition of the Custodian is deteriorating in any material respect, in which case termination shall take effect upon the Custodian's receipt of such notice or at such later time as such Fund shall designate. In the event of termination pursuant to this Section 7.01 by any Fund (a "Terminating Fund"), each Terminating Fund shall make payment of all accrued fees and unreimbursed expenses with respect to such Terminating Fund within a reasonable time following termination and delivery of a statement to the Terminating Fund setting forth such fees and expenses. Each Terminating Fund shall identify in any notice of termination a successor custodian or custodians to which the cash, securities and other assets of its Portfolios shall, upon termination of this Agreement with respect to such Terminating Fund, be delivered. In the event that no written notice designating a successor custodian shall have been delivered to the Custodian on or before the date when termination of this Agreement as to a Terminating Fund shall become effective, the Custodian may deliver to a bank or trust company doing business in Boston, Massachusetts, of its own selection, having an aggregate capital, surplus, and undivided profits, as shown by its last published report, of not less than $25,000,000, all securities and other assets of such Terminating Fund's Portfolios held by the Custodian and all instruments held by the Custodian relative thereto and all other property of the Terminating Fund's Portfolios held by the Custodian under this Agreement. Thereafter, such bank or trust company shall be the successor of the Custodian with respect to such Terminating Fund under this Agreement. In the event that securities and other assets of such Terminating Fund's Portfolios remain in the possession of the Custodian after the date of termination hereof with respect to such Terminating Fund owing to failure of the Terminating Fund to appoint a successor custodian, the Custodian shall be entitled to compensation for its services in accordance with the fee schedule most recently in effect, for such period as the Custodian retains possession of such securities and other assets, and the provisions of this Agreement relating to the duties and obligations of the Custodian and the Terminating Fund shall remain in full force and effect. In the event of the appointment of a successor custodian, it is agreed that the cash, securities and other property owned by a Terminating Fund and held by the Custodian, any Subcustodian or nominee shall be delivered to the successor custodian; and the Custodian agrees to cooperate with such Terminating Fund in the execution of documents and performance of other actions necessary or desirable in order to substitute the successor custodian for the Custodian under this Agreement. Section 7.02. Termination as to One or More Portfolios. This Agreement may be terminated as to one or more of a Fund's Portfolios (but less than all of its Portfolios) by delivery of an amended Appendix "A" deleting such Portfolios pursuant to Section 9.05(b) hereof, in which case termination as to such deleted Portfolios shall take effect thirty (30) days after the date of such delivery. The execution and delivery of an amended Appendix "A" which deletes one or more Portfolios shall constitute a termination of this Agreement only with respect to such deleted Portfolio(s), shall be governed by the preceding provisions of Section 7.01 as to the identification of a successor custodian and the delivery of cash, securities and other assets of the Portfolio(s) so deleted, and shall not affect the obligations of the Custodian and any Fund hereunder with respect to the other Portfolios set forth in Appendix "A," as amended from time to time. ARTICLE VIII DEFINED TERMS The following terms are defined in the following sections: Term Section Account 2.22 ADRs 2.06 Additional Custodian 2.23(a) Authorized Person(s) 3.02 Banking Institution 2.12(a) Business Day Appendix "C" Bank Accounts 2.21 Distribution Account 2.16 Domestic Subcustodian 4.01 Foreign Subcustodian 4.02(a) Fund Preamble Institutional Client 2.03 Interim Subcustodian 4.02(b) Overdraft 2.28 Overdraft Notice 2.28 Person 5.01(b) Portfolio Preamble Procedural Agreement 2.10 Proper Instructions 3.01(a) SEC 2.22 Securities System 2.22 Shares 2.16 Special Instructions 3.01(b) Special Subcustodian 4.03 Subcustodian Article IV Terminating Fund 7.01 1940 Act Preamble ARTICLE IX MISCELLANEOUS Section 9.01. Execution of Documents, Etc. (a) Actions by each Fund. Upon request, each Fund shall execute and deliver to the Custodian such proxies, powers of attorney or other instruments as may be reasonable and necessary or desirable in connection with the performance by the Custodian or any Subcustodian of their respective obligations to such Fund under this Agreement or any applicable subcustodian agreement with respect to such Fund, provided that the exercise by the Custodian or any Subcustodian of any such rights shall in all events be in compliance with the terms of this Agreement. (b) Actions by Custodian. Upon receipt of Proper Instructions, the Custodian shall execute and deliver to each applicable Fund or to such other parties as such Fund(s) may designate in such Proper Instructions, all such documents, instruments or agreements as may be reasonable and necessary or desirable in order to effectuate any of the transactions contemplated hereby. Section 9.02. Representative Capacity; Nonrecourse Obligations. A COPY OF THE DECLARATION OF TRUST OR OTHER ORGANIZATIONAL DOCUMENT OF EACH FUND IS ON FILE WITH THE SECRETARY OF THE STATE OF THE FUND'S FORMATION, AND NOTICE IS HEREBY GIVEN THAT THIS AGREEMENT IS NOT EXECUTED ON BEHALF OF THE TRUSTEES OF ANY FUND AS INDIVIDUALS, AND THE OBLIGATIONS OF THIS AGREEMENT ARE NOT BINDING UPON ANY OF THE TRUSTEES, OFFICERS, SHAREHOLDERS OR PARTNERS OF ANY FUND INDIVIDUALLY, BUT ARE BINDING ONLY UPON THE ASSETS AND PROPERTY OF EACH FUND'S RESPECTIVE PORTFOLIOS. THE CUSTODIAN AGREES THAT NO SHAREHOLDER, TRUSTEE, OFFICER OR PARTNER OF ANY FUND MAY BE HELD PERSONALLY LIABLE OR RESPONSIBLE FOR ANY OBLIGATIONS OF ANY FUND ARISING OUT OF THIS AGREEMENT. Section 9.03. Several Obligations of the Funds and the Portfolios. WITH RESPECT TO ANY OBLIGATIONS OF A FUND ON BEHALF OF ANY OF ITS PORTFOLIOS ARISING OUT OF THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, THE OBLIGATIONS ARISING UNDER SECTIONS 2.28, 5.03, 5.05 and ARTICLE VI HEREOF, THE CUSTODIAN SHALL LOOK FOR PAYMENT OR SATISFACTION OF ANY OBLIGATION SOLELY TO THE ASSETS AND PROPERTY OF THE PORTFOLIO TO WHICH SUCH OBLIGATION RELATES AS THOUGH EACH FUND HAD SEPARATELY CONTRACTED WITH THE CUSTODIAN BY SEPARATE WRITTEN INSTRUMENT WITH RESPECT TO EACH OF ITS PORTFOLIOS. Section 9.04. Representations and Warranties. (a) Representations and Warranties of Each Fund. Each Fund hereby severally and not jointly represents and warrants that each of the following shall be true, correct and complete with respect to each Fund at all times during the term of this Agreement: (i) the Fund is duly organized under the laws of its jurisdiction of organization and is registered as an open-end management investment company under the 1940 Act; and (ii) the execution, delivery and performance by the Fund of this Agreement are (w) within its power, (x) have been duly authorized by all necessary action, and (y) will not (A) contribute to or result in a breach of or default under or conflict with any existing law, order, regulation or ruling of any governmental or regulatory agency or authority, or (B) violate any provision of the Fund's corporate charter, Declaration of Trust or other organizational document, or bylaws, or any amendment thereof or any provision of its most recent Prospectus or Statement of Additional Information. (b) Representations and Warranties of the Custodian. The Custodian hereby represents and warrants to each Fund that each of the following shall be true, correct and complete at all times during the term of this Agreement: (i) the Custodian is duly organized under the laws of its jurisdiction of organization and qualifies to act as a custodian to open-end management investment companies under the provisions of the 1940 Act; and (ii) the execution, delivery and performance by the Custodian of this Agreement are (w) within its power, (x) have been duly authorized by all necessary action, and (y) will not (A) contribute to or result in a breach of or default under or conflict with any existing law, order, regulation or ruling of any governmental or regulatory agency or authority, or (B) violate any provision of the Custodian's corporate charter, or other organizational document, or bylaws, or any amendment thereof. Section 9.05. Entire Agreement. This Agreement constitutes the entire understanding and agreement of the Fund, on the one hand, and the Custodian, on the other, with respect to the subject matter hereof and accordingly, supersedes as of the effective date of this Agreement any custodian agreement heretofore in effect between each Fund and the Custodian. Section 9.06. Waivers and Amendments. No provision of this Agreement may be waived, amended or terminated except by a statement in writing signed by the party against which enforcement of such waiver, amendment or termination is sought; provided, however: (a) Appendix "A" listing the Portfolios of each Fund for which the Custodian serves as custodian may be amended from time to time to add one or more Portfolios for one or more Funds, by each applicable Fund's execution and delivery to the Custodian of an amended Appendix "A", and the execution of such amended Appendix by the Custodian, in which case such amendment shall take effect immediately upon execution by the Custodian; (b) Appendix "A" may be amended from time to time to delete one or more Portfolios (but less than all of the Portfolios) of one or more of the Funds, by each applicable Fund's execution and delivery to the Custodian of an amended Appendix "A", in which case such amendment shall take effect thirty (30) days after such delivery, unless otherwise agreed by the Custodian and each applicable Fund in writing; (c) Appendix "B" listing Foreign Subcustodians, Special Subcustodians and Additional Custodians approved by any Fund may be amended from time to time to add or delete one or more Foreign Subcustodians, Special Subcustodians or Additional Custodians for a Fund or Funds by each applicable Fund's execution and delivery to the Custodian of an amended Appendix "B", in which case such amendment shall take effect immediately upon execution by the Custodian; and (d) Appendix "C" setting forth the procedures relating to the Custodian's security interest with respect to each Fund may be amended only by an instrument in writing executed by each applicable Fund and the Custodian. Section 9.07. Interpretation. In connection with the operation of this Agreement, the Custodian and any Fund may agree in writing from time to time on such provisions interpretative of or in addition to the provisions of this Agreement with respect to such Fund as may in their joint opinion be consistent with the general tenor of this Agreement. No interpretative or additional provisions made as provided in the preceding sentence shall be deemed to be an amendment of this Agreement or affect any other Fund. Section 9.08. Captions. Headings contained in this Agreement, which are included as convenient references only, shall have no bearing upon the interpretation of the terms of the Agreement or the obligations of the parties hereto. Section 9.09. Governing Law. Insofar as any question or dispute may arise in connection with the custodianship of foreign securities pursuant to an agreement with a Foreign Subcustodian that is governed by the laws of the State of New York, the provisions of this Agreement shall be construed in accordance with and governed by the laws of the State of New York, provided that in all other instances this Agreement shall be construed in accordance with and governed by the laws of the Commonwealth of Massachusetts, in each case without giving effect to principles of conflicts of law. Section 9.10. Notices. Except in the case of Proper Instructions or Special Instructions, notices and other writings contemplated by this Agreement shall be delivered by hand or by facsimile transmission (provided that in the case of delivery by facsimile transmission, notice shall also be mailed postage prepaid to the parties at the following addresses: (a) If to any Fund: c/o Fidelity Management & Research Company 82 Devonshire Street Boston, Massachusetts 02109 Attn: Treasurer of the Fidelity Funds Telephone: (617) 563-7000 Telefax: (617) 476-4195 (b) If to the Custodian: The Chase Manhattan Bank, N.A. Four Chase Metrotech Center, 8th Floor Brooklyn, New York 11245 Attn: Don Gandy, Vice President Telephone: (718) 242-3439 Telefax: (718) 242-1374 or to such other address as a Fund or the Custodian may have designated in writing to the other. Section 9.11. Assignment. This Agreement shall be binding on and shall inure to the benefit of each Fund severally and the Custodian and their respective successors and assigns, provided that, subject to the provisions of Section 7.01 hereof, neither the Custodian nor any Fund may assign this Agreement or any of its rights or obligations hereunder without the prior written consent of the other party. Section 9.12. Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be deemed an original. With respect to each Fund, this Agreement shall become effective when one or more counterparts have been signed and delivered by such Fund and the Custodian. Section 9.13. Confidentiality; Survival of Obligations. The parties hereto agree that each shall treat confidentially the terms and conditions of this Agreement and all information provided by each party to the other regarding its business and operations. All confidential information provided by a party hereto shall be used by any other party hereto solely for the purpose of rendering services pursuant to this Agreement and, except as may be required in carrying out this Agreement, shall not be disclosed to any third party without the prior consent of such providing party. The foregoing shall not be applicable to any information that is publicly available when provided or thereafter becomes publicly available other than through a breach of this Agreement, or that is required to be disclosed by any bank examiner of the Custodian or any Subcustodian, any auditor of the parties hereto, by judicial or administrative process or otherwise by applicable law or regulation. The provisions of this Section 9.13 and Sections 9.01, 9.02, 9.03, 9.09, Section 2.28, Section 3.04, Section 7.01, Article V and Article VI hereof and any other rights or obligations incurred or accrued by any party hereto prior to termination of this Agreement shall survive any termination of this Agreement. IN WITNESS WHEREOF, each of the parties has caused this Agreement to be executed in its name and behalf on the day and year first above written. Each of the Investment Companies Listed on The Chase Manahattan Bank, N.A. Appendix "A" Attached Hereto, on Behalf of each of Their Respective Portfolios [Signature Lines Omitted] Exhibit 8(q) Form of Appendix "B" To Custodian Agreement Between The Chase Manhattan Bank, N.A. and Each of the Investment Companies Listed on Appendix "A" thereto Dated as of _____________________ The following is a list of Additional Custodians, Special Subcustodians and Foreign Subcustodians under the Custodian Agreement dated as of _________________ (the "Custodian Agreement"): A. Additional Custodians: CUSTODIAN PURPOSE Bank of New York FICASH FITERM B. Special Subcustodians: SUBCUSTODIAN PURPOSE Bank of New York FICASH Citibank, N.A. Global Bond Certificates* C. Foreign Subcustodians: COUNTRY FOREIGN SUBCUSTODIAN DEPOSITORY Argentina Chase Manhattan Bank, N.A., Buenos Aires Caja de Valores, S.A. Australia The Chase Manhattan Bank Australia Ltd., Austraclear Limited Sydney RITS Austria Creditanstalt-Bankverein, Osterreichsche Kontrollbank Vienna Aktiengesellschaft (OEKB) Bangladesh Standard Chartered Bank, Dhaka None Belgium Generale Bank, Caisse Interprofessionnelle Brussels de Depot et de Virement de Titres (CIK) ____________________ * Citibank, N.A. will act as Special Subcustodian with respect to global bond certificates for the following portfolios only: Fidelity Advisor Series VIII: Fidelity Advisor Emerging Markets Income Fund; Fidelity Investment Trust: Fidelity New Markets Income Fund. Bostawana Barclays Bank of Bostawana Ltd., None Gaborone Brazil Banco Chase Manhattan, S.A. Sao Paolo Stock Exchange Sao Paolo (BOVESPA); Sistema Especial de Liquidacao e Custodia (SELIC) Canada Canada Trust Company, Toronto Canadian Depository for Securities Ltd. (CDS) Royal Bank of Canada Chile Chase Manhattan Bank, N.A., Santiago None China-Shanghai Hongkong & Shanghai Banking Shanghai Securities Central Corp., Ltd. Clearing & Registration Corp. (SSCCRC) China-Shenzhen Hongkong & Shanghai Banking Shenzhen Securities Corp., Ltd. Registrations Corp., Ltd. (SSRC) Colombia Cititrust Colombia S.A., Sociedad Fiduciaria, None Bogota Czeck Republic Ceskoslovenska Obchodni Banka, A.S., Prague Securities Center (SCP) Ecuador Citibank, N.A., Quito Denmark Den Danske Bank, Copenhagen Vaerdipapircentralen-VP Center Egypt National Bank of Egypt, Cairo None Finland Merita Bnak, Ltd., Pankkitarkastus Virasto Helsinki ("Securities Association") France Banque Paribas, Paris SICOVAM Germany Chase Bank A.G., Frankfurt Deutscher Kassenverein AG (DKV) Ghana Barclays Bank of Ghana Ltd., Accra None Greece Barclays Bank Plc, Athens Apothetirio Titlon, A.E. Hong Kong Chase Manhattan Bank, N.A., Hong Kong Securities Hong Kong Clearing Co., (HKSCC), Central Clearing & Settlement System (CCASS) Hungary Citibank Budapest Rt. Central Depository & Clearing House (Budapest) Ltd. (KELLER Ltd.) India Hongkong & Shanghai Banking Corp. Ltd., None Bombay Indonesia Hongkong & Shanghai Banking Corp. Ltd., None Jakarta Ireland Bank of Ireland, Dublin None Israel Bank Leumi Le-Israel, B. M., Tel Aviv Tel Aviv Stock Exchange (TASE) Clearinghouse Ltd. Italy Chase Manhattan Bank, N.A., Milan Monte Titoli S.p.A. Japan The Fuji Bank, Limited, Tokyo Japan Securities Depository Center (JASDEC) Jordan Arab Bank, PLC, Amman None Kenya Barclays Bank of Kenya Ltd., Nairobi None Malaysia The Chase Manhattan Bank Malaysian Central Depository (M) Berhad Sdn. Bhd. (MCD) Mauritius Hongkong & Shanghai Banking Corp. Ltd., None Port Louis Mexico Chase Manhattan Bank, Mexico, S.A. Institucion para el Deposito de Institucion de Banca Multiple Valores-S.D. INDEVAL, S.A. de C.V. Morocco Banque Commerciale du Maroc, None Casablanca Netherlands ABN-AMRO, Bank N.V., Nedelands Centraal Instituut Amsterdam voor Giraal Effectenverkeer BV (NECIGEF)/KAS Associatie, N.V. New Zealand National Nominees Ltd., Auckland Austraclear Limited through the Reserve Bank of New Zealand (RBNZ) Norway Den norske Bank, Oslo Verdipapirsentralen (VPS) Pakistan Citibank, N. A., Karachi None Deutsche Bank AG, Karachi Peru Citibank, N.A., Lima None Philippines Hongkong & Shanghai Banking None Corp., Ltd., Manila Poland Bank Handlowy W. Warszawie, S.A., Warsaw National Depository of Securities Portugal Banco Espirito Santo E Commercial Central de Valores Mobiliaros de Lisboa, S.A., Lisbon (Interbolsa) Singapore Chase Manhattan Bank, N.A., Singapore Central Depository Pte Ltd. (CDP) Slovak Republic Ceskoslovenska Obchodni, Banka, S.A. Stredisko Cennyah Papierov (SCP) Bratislava South Africa Standard Bank of South Africa, Ltd., The Central Depository Limited Johannesburg South Korea Hongkong & Shanghai Banking Corp., Ltd., Korean Securities Depository Seoul (KSD) Spain Banque Bruxelles Lambert, Servicio de Compensacion y Madrid Liquidacion de Valores (SCLV) Chase Manhattan Bank, N.A., Madrid Sri Lanka Hongkong & Shanghai Banking Corp., Ltd., Central Depository System Colombo (Pvt) Limited (CDS) Sweden Skandinaviska Enskilda Banken, Stokholm Vardepappercentralen VPC AB Switzerland Union Bank of Switzerland, Schweizerische Effekten- Zurich Giro A.G. (SEGA) Taiwan Chase Manhattan Bank, N.A., Taiwan Securities Central Taipei Depository Co., Ltd. (TSCD) Thailand Chase Manhattan Bank, N.A., Bangkok Share Depository Center (SDC) Transnational CEDEL, S.A. Luxembourg Euroclear Clearance System Societe Cooperative, Belgium Turkey Chase Manhattan Bank, N.A., Istanbul Takas ve Saklama A.S. (TvS) United Kingdom Chase Manhattan Bank, N.A., London CREST First National Bank of Chicago, London Uruguay The First National Bank of Boston, Montevideo None Venezuela Citibank, N.A., Caracas None Zambia Barclays Bank of Zambia Ltd., Lusaka Lusaka Stock Exchange Zimbabwe Barclays Bank of Zimbabwe Ltd., Harare None Each of the Investment Companies Listed on Appendix "A" to the Custodian Agreement, on Behalf of Each of Their Respective Portfolios By: Name: Title: Exhibit 8(q) Form Of Appendix "C" to the Custodian Agreement Between Each of the Investment Companies Listed on Appendix "A" Thereto And THE CHASE MANHATTAN BANK, N.A. Dated as of ____________________ PROCEDURES RELATING TO CUSTODIAN'S SECURITY INTEREST As security for any Overdrafts (as defined in the Custodian Agreement) of any Portfolio, the applicable Fund, on behalf of such Portfolio, shall pledge, assign and grant to the Custodian a security interest in Collateral (as hereinafter defined), under the terms, circumstances and conditions set forth in this Appendix "C". Section 1. Defined Terms. As used in this Appendix "C" the following terms shall have the following respective meanings: (a) "Business Day" shall mean any day that is not a Saturday, a Sunday or a day on which the Custodian is closed for business. (b) "Collateral" shall mean, with respect to any Portfolio, securities held by the Custodian on behalf of the Portfolio having a fair market value (as determined in accordance with the procedures set forth in the prospectus for the Portfolio) equal to the aggregate of all Overdraft Obligations of such Portfolio: (i) identified in any Pledge Certificate executed on behalf of such Portfolio; or (ii) designated by the Custodian for such Portfolio pursuant to Section 3 of this Appendix C. Such securities shall consist of marketable securities held by the Custodian on behalf of such Portfolio or, if no such marketable securities are held by the Custodian on behalf of such Portfolio, such other securities designated by the applicable Fund in the applicable Pledge Certificate or by the Custodian pursuant to Section 3 of this Appendix C. (c) "Overdraft Obligations" shall mean, with respect to any Portfolio, the amount of any outstanding Overdraft(s) provided by the Custodian to such Portfolio together with all accrued interest thereon. (d) "Pledge Certificate" shall mean a Pledge Certificate in the form attached to this Appendix "C" as Schedule 1 executed by a duly authorized officer of the applicable Fund and delivered by such Fund to the Custodian by facsimile transmission or in such other manner as the applicable Fund and the Custodian may agree in writing. (e) "Release Certificate" shall mean a Release Certificate in the form attached to this Appendix "C" as Schedule 2 executed by a duly authorized officer of the Custodian and delivered by the Custodian to the applicable Fund by facsimile transmission or in such other manner as such Fund and the Custodian may agree in writing. (f) "Written Notice" shall mean a written notice executed by a duly authorized officer of the party delivering the notice and delivered by facsimile transmission or in such other manner as the applicable Fund and the Custodian shall agree in writing. Section 2. Pledge of Collateral. To the extent that any Overdraft Obligations of a Portfolio are not satisfied by the close of business on the first Business Day following the Business Day on which the applicable Fund receives Written Notice requesting security for such Overdraft Obligation and stating the amount of such Overdraft Obligation, the applicable Fund, on behalf of such Portfolio, shall pledge, assign and grant to the Custodian a first priority security interest, by delivering to the Custodian, a Pledge Certificate executed by such Fund on behalf of such Portfolio describing the applicable Collateral. Such Written Notice may, in the discretion of the Custodian, be included within or accompany the Overdraft Notice relating to the applicable Overdraft Obligations. Section 3. Failure to Pledge Collateral. In the event that the applicable Fund shall fail: (a) to pay, on behalf of the applicable Portfolio, the Overdraft Obligation described in such Written Notice; (b) to deliver to the Custodian a Pledge Certificate pursuant to Section 2; or (c) to identify substitute securities pursuant to Section 6 upon the sale or maturity of any securities identified as Collateral, the Custodian may, by Written Notice to the applicable Fund specify Collateral which shall secure the applicable Overdraft Obligation. Such Fund, on behalf of any applicable Portfolio, hereby pledges, assigns and grants to the Custodian a first priority security interest in any and all Collateral specified in such Written Notice; provided that such pledge, assignment and grant of security shall be deemed to be effective only upon receipt by the applicable Fund of such Written Notice. Section 4. Delivery of Additional Collateral. If at any time the Custodian shall notify a Fund by Written Notice that the fair market value of the Collateral securing any Overdraft Obligation of one of such Fund's Portfolios is less than the amount of such Overdraft Obligation, such Fund, on behalf of the applicable Portfolio, shall deliver to the Custodian, within one (1) Business Day following the Fund's receipt of such Written Notice, an additional Pledge Certificate describing additional Collateral. If such Fund shall fail to deliver such additional Pledge Certificate, the Custodian may specify Collateral which shall secure the unsecured amount of the applicable Overdraft Obligation in accordance with Section 3 of this Appendix C. Section 5. Release of Collateral. Upon payment by a Fund, on behalf of one of its Portfolios, of any Overdraft Obligation secured by the pledge of Collateral, the Custodian shall promptly deliver to such Fund a Release Certificate pursuant to which the Custodian shall release Collateral from the lien under the applicable Pledge Certificate or Written Notice pursuant to Section 3 having a fair market value equal to the amount paid by such Fund on account of such Overdraft Obligation. In addition, if at any time a Fund shall notify the Custodian by Written Notice that such Fund desires that specified Collateral be released and: (a) that the fair market value of the Collateral securing any Overdraft Obligation shall exceed the amount of such Overdraft Obligation; or (b) that the Fund has delivered a Pledge Certificate substituting Collateral for such Overdraft Obligation, the Custodian shall deliver to such Fund, within one (1) Business Day following the Custodian's receipt of such Written Notice, a Release Certificate relating to the Collateral specified in such Written Notice. Section 6. Substitution of Collateral. A Fund may substitute securities for any securities identified as Collateral by delivery to the Custodian of a Pledge Certificate executed by such Fund on behalf of the applicable Portfolio, indicating the securities pledged as Collateral. Section 7. Security for Individual Portfolios' Overdraft Obligations. The pledge of Collateral by a Fund on behalf of any of its individual Portfolios shall secure only the Overdraft Obligations of such Portfolio. In no event shall the pledge of Collateral by one of a Fund's Portfolios be deemed or considered to be security for the Overdraft Obligations of any other Portfolio of such Fund or of any other Fund. Section 8. Custodian's Remedies. Upon (a) a Fund's failure to pay any Overdraft Obligation of an applicable Portfolio within thirty (30) days after receipt by such Fund of a Written Notice demanding security therefore, and (b) one (1) Business Day's prior Written Notice to such Fund, the Custodian may elect to enforce its security interest in the Collateral securing such Overdraft Obligation, by taking title to (at the then prevailing fair market value), or selling in a commercially reasonable manner, so much of the Collateral as shall be required to pay such Overdraft Obligation in full. Notwithstanding the provisions of any applicable law, including, without limitation, the Uniform Commercial Code, the remedy set forth in the preceding sentence shall be the only right or remedy to which the Custodian is entitled with respect to the pledge and security interest granted pursuant to any Pledge Certificate or Section 3. Without limiting the foregoing, the Custodian hereby waives and relinquishes all contractual and common law rights of set off to which it may now or hereafter be or become entitled with respect to any obligations of any Fund to the Custodian arising under this Appendix "C" to the Agreement. IN WITNESS WHEREOF, each of the parties has caused this Appendix to be executed in its name and behalf on the day and year first above written. Each of the Investment Companies Listed on The Chase Manhattan Bank, N.A. Schedule "A" to the Custodian Agreement, on Behalf of Each of Their Respective Portfolios By: By: Name: Name: Title: Title: SCHEDULE 1 TO APPENDIX "C" PLEDGE CERTIFICATE This Pledge Certificate is delivered pursuant to the Custodian Agreement dated as of [ ] (the "Agreement"), between [ ] (the "Fund") and [ ] (the "Custodian"). Capitalized terms used herein without definition shall have the respective meanings ascribed to them in the Agreement. Pursuant to [Section 2 or Section 4] of Appendix "C" attached to the Agreement, the Fund, on behalf of [ ] (the "Portfolio"), hereby pledges, assigns and grants to the Custodian a first priority security interest in the securities listed on Exhibit "A" attached to this Pledge Certificate (collectively, the "Pledged Securities"). Upon delivery of this Pledge Certificate, the Pledged Securities shall constitute Collateral, and shall secure all Overdraft Obligations of the Portfolio described in that certain Written Notice dated , 19 , delivered by the Custodian to the Fund. The pledge, assignment and grant of security in the Pledged Securities hereunder shall be subject in all respect to the terms and conditions of the Agreement, including, without limitation, Sections 7 and 8 of Appendix "C" attached thereto. IN WITNESS WHEREOF, the Fund has caused this Pledge Certificate to be executed in its name, on behalf of the Portfolio this day of 19 . [FUND], on Behalf of [Portfolio] By: ___________________ Name: ___________________ Title: ___________________ EXHIBIT "A" TO PLEDGE CERTIFICATE Type of Certificate/CUSIP Number of Issuer Security Numbers Shares SCHEDULE 2 TO APPENDIX "C" RELEASE CERTIFICATE This Release Certificate is delivered pursuant to the Custodian Agreement dated as of [ ] (the "Agreement"), between [ ] (the "Fund") and [ ] (the "Custodian"). Capitalized terms used herein without definition shall have the respective meanings ascribed to them in the Agreement. Pursuant to Section 5 of Appendix "C" attached to the Agreement, the Custodian hereby releases the securities listed on Exhibit "A" attached to this Release Certificate from the lien under the [Pledge Certificate dated ___________, 19 or the Written Notice delivered pursuant to Section 3 of Appendix "C" dated _________, 19 ]. IN WITNESS WHEREOF, the Custodian has caused this Release Certificate to be executed in its name and on its behalf this day of 19 . THE CHASE MANHATTAN BANK, N.A. By: _____________________ Name: _____________________ Title: _____________________ EXHIBIT "A" TO RELEASE CERTIFICATE Type of Certificate/CUSIP Number of Issuer Security Numbers Shares EX-99.B11 17 CONSENT OF INDEPENDENT ACCOUNTANTS We hereby consent to the reference to our Firm under the headings "Auditor" in the Statements of Additional Information of Fidelity Hastings Street Trust: Fidelity Income & Growth Fund and Fidelity Contrafund II which is included in Post-Effective Amendment No. 102 to the Registration Statement on Form N-1A. /s/COOPERS & LYBRAND L.L.P. COOPERS & LYBRAND L.L.P. Boston, Massachusetts March 19, 1998 EX-99.B15 18 Exhibit 15(b) FORM OF DISTRIBUTION AND SERVICE PLAN FIDELITY HASTINGS STREET TRUST: FIDELITY INCOME & GROWTH FUND 1. This Distribution and Service Plan (the "Plan"), when effective in accordance with its terms, shall be the written plan contemplated by Rule 12b-1 under the Investment Company Act of 1940 (the "Act") of Fidelity Income & Growth Fund (the "Portfolio"), a series of shares of Fidelity Hastings Street Trust (the "Fund"). 2. The Fund has entered into a General Distribution Agreement with respect to the Portfolio with Fidelity Distributors Corporation (the "Distributor"), a wholly-owned subsidiary of Fidelity Management & Research Company (the "Adviser"), under which the Distributor uses all reasonable efforts, consistent with its other business, to secure purchasers for the Portfolio's shares of beneficial interest ("shares"). Under the agreement, the Distributor pays the expenses of printing and distributing any prospectuses, reports and other literature used by the Distributor, advertising, and other promotional activities in connection with the offering of shares of the Portfolio for sale to the public. It is recognized that the Adviser may use its management fee revenues as well as past profits or its resources from any other source, to make payment to the Distributor with respect to any expenses incurred in connection with the distribution of Portfolio shares, including the activities referred to above. 3. The Adviser directly, or through the Distributor, may, subject to the approval of the Trustees, make payments to securities dealers and other third parties who engage in the sale of shares or who render shareholder support services, including but not limited to providing office space, equipment and telephone facilities, answering routine inquiries regarding the Portfolio, processing shareholder transactions and providing such other shareholder services as the Fund may reasonably request. 4. The Portfolio will not make separate payments as a result of this Plan to the Adviser, Distributor or any other party, it being recognized that the Portfolio presently pays, and will continue to pay, a management fee to the Adviser. To the extent that any payments made by the Portfolio to the Adviser, including payment of management fees, should be deemed to be indirect financing of any activity primarily intended to result in the sale of shares of the Portfolio within the context of Rule 12b-1 under the Act, then such payments shall be deemed to be authorized by this Plan. 5. This Plan shall become effective upon the approval by a vote of a majority of the Trustees of the Fund, including a majority of Trustees who are not "interested persons" of the Fund (as defined in the Act) and who have no direct or indirect financial interest in the operation of this Plan or in any agreements related to this Plan (the "Independent Trustees"), cast in person at a meeting called for the purpose of voting on this Plan. 6. This Plan shall, unless terminated as hereinafter provided, remain in effect from the date specified above until April 30, 199_ and from year to year thereafter, provided, however, that such continuance is subject to approval annually by a vote of a majority of the Trustees of the Fund, including a majority of the Independent Trustees, cast in person at a meeting called for the purpose of voting on this Plan. This Plan may be amended at any time by the Board of Trustees, provided that (a) any amendment to authorize direct payments by the Portfolio to finance any activity primarily intended to result in the sale of shares of the Portfolio, to increase materially the amount spent by the Portfolio for distribution, or any amendment of the Management Contract to increase the amount to be paid by the Portfolio thereunder shall be effective only upon approval by a vote of a majority of the outstanding voting securities of the Portfolio, and (b) any material amendments of this Plan shall be effective only upon approval in the manner provided in the first sentence in this paragraph. 7. This Plan may be terminated at any time, without the payment of any penalty, by vote of a majority of the Independent Trustees or by a vote of a majority of the outstanding voting securities of the Portfolio. 8. During the existence of this Plan, the Fund shall require the Adviser and/or Distributor to provide the Fund, for review by the Fund's Board of Trustees, and the Trustees shall review, at least quarterly, a written report of the amounts expended in connection with financing any activity primarily intended to result in the sale of shares of the Portfolio (making estimates of such costs where necessary or desirable) and the purposes for which such expenditures were made. 9. This Plan does not require the Adviser or Distributor to perform any specific type or level of distribution activities or to incur any specific level of expenses for activities primarily intended to result in the sale of shares of the Portfolio. 10. Consistent with the limitation of shareholder liability as set forth in the Fund's Declaration of Trust or other organizational document, any obligations assumed by the Portfolio pursuant to this Plan and any agreements related to this Plan shall be limited in all cases to the Portfolio and its assets, and shall not constitute obligations of any other series of shares of the Fund. 11. If any provision of this Plan shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of the Plan shall not be affected thereby. EX-99.B15 19 Exhibit 15(c) FORM OF DISTRIBUTION AND SERVICE PLAN FIDELITY HASTINGS STREET TRUST: ___________________ 1. This Distribution and Service Plan (the "Plan"), when effective in accordance with its terms, shall be the written plan contemplated by Rule 12b-1 under the Investment Company Act of 1940 (the "Act") of ______________ (the "Portfolio"), a series of shares of Fidelity Hastings Street Trust (the "Fund"). 2. The Fund has entered into a General Distribution Agreement with respect to the Portfolio with Fidelity Distributors Corporation (the "Distributor"), a wholly-owned subsidiary of Fidelity Management & Research Company (the "Adviser"), under which the Distributor uses all reasonable efforts, consistent with its other business, to secure purchasers for the Portfolio's shares of beneficial interest ("shares"). Under the agreement, the Distributor pays the expenses of printing and distributing any prospectuses, reports and other literature used by the Distributor, advertising, and other promotional activities in connection with the offering of shares of the Portfolio for sale to the public. It is recognized that the Adviser may use its management fee revenues as well as past profits or its resources from any other source, to make payment to the Distributor with respect to any expenses incurred in connection with the distribution of Portfolio shares, including the activities referred to above. 3. The Adviser directly, or through the Distributor, may, subject to the approval of the Trustees, make payments to securities dealers and other third parties who engage in the sale of shares or who render shareholder support services, including but not limited to providing office space, equipment and telephone facilities, answering routine inquiries regarding the Portfolio, processing shareholder transactions and providing such other shareholder services as the Fund may reasonably request. 4. The Portfolio will not make separate payments as a result of this Plan to the Adviser, Distributor or any other party, it being recognized that the Portfolio presently pays, and will continue to pay, a management fee to the Adviser. To the extent that any payments made by the Portfolio to the Adviser, including payment of management fees, should be deemed to be indirect financing of any activity primarily intended to result in the sale of shares of the Portfolio within the context of Rule 12b-1 under the Act, then such payments shall be deemed to be authorized by this Plan. 5. This Plan shall become effective upon the approval by a vote of a majority of the Trustees of the Fund, including a majority of Trustees who are not "interested persons" of the Fund (as defined in the Act) and who have no direct or indirect financial interest in the operation of this Plan or in any agreements related to this Plan (the "Independent Trustees"), cast in person at a meeting called for the purpose of voting on this Plan. 6. This Plan shall, unless terminated as hereinafter provided, remain in effect from the date specified above until April 30, 199_ and from year to year thereafter, provided, however, that such continuance is subject to approval annually by a vote of a majority of the Trustees of the Fund, including a majority of the Independent Trustees, cast in person at a meeting called for the purpose of voting on this Plan. This Plan may be amended at any time by the Board of Trustees, provided that (a) any amendment to authorize direct payments by the Portfolio to finance any activity primarily intended to result in the sale of shares of the Portfolio, to increase materially the amount spent by the Portfolio for distribution, or any amendment of the Management Contract to increase the amount to be paid by the Portfolio thereunder shall be effective only upon approval by a vote of a majority of the outstanding voting securities of the Portfolio, and (b) any material amendments of this Plan shall be effective only upon approval in the manner provided in the first sentence in this paragraph. 7. This Plan may be terminated at any time, without the payment of any penalty, by vote of a majority of the Independent Trustees or by a vote of a majority of the outstanding voting securities of the Portfolio. 8. During the existence of this Plan, the Fund shall require the Adviser and/or Distributor to provide the Fund, for review by the Fund's Board of Trustees, and the Trustees shall review, at least quarterly, a written report of the amounts expended in connection with financing any activity primarily intended to result in the sale of shares of the Portfolio (making estimates of such costs where necessary or desirable) and the purposes for which such expenditures were made. 9. This Plan does not require the Adviser or Distributor to perform any specific type or level of distribution activities or to incur any specific level of expenses for activities primarily intended to result in the sale of shares of the Portfolio. 10. Consistent with the limitation of shareholder liability as set forth in the Fund's Declaration of Trust or other organizational document, any obligations assumed by the Portfolio pursuant to this Plan and any agreements related to this Plan shall be limited in all cases to the Portfolio and its assets, and shall not constitute obligations of any other series of shares of the Fund. 11. If any provision of this Plan shall be held or made invalid by a court decision, statute, rule or otherwise, the remainder of the Plan shall not be affected thereby. -----END PRIVACY-ENHANCED MESSAGE-----