IMPORTANT PROXY MATERIALS ARE ON THE WAY RIGHT NOW!
Dear Investment Professional:
On July 16, 1997, there will be a special meeting of shareholders of the
following Fidelity Advisor Funds:
(solid bullet) Equity Growth Fund (Class A, Class T, Class B, and
Institutional Class)
(solid bullet) Mid Cap Fund (Class A, Class T, Class B, and Institutional
Class)
(solid bullet) Large Cap Fund (Class A, Class T, Class B, and
Institutional Class)
(solid bullet) TechnoQuant Growth Fund (Class A, Class T, Class B, and
Institutional Class)
(solid bullet) Growth & Income Fund (Class A, Class T, Class B, and
Institutional Class)
The enclosed Proxy Statement details the proposals pertaining to these
funds. A copy of each shareholder letter being mailed to clients who hold
shares in these funds is also included.
We have also enclosed a Q&A to assist you in understanding most of the
proposals that will require voting. If you have any questions about this
proxy after reading the letter, Proxy Statement, and Q&A, please call
Fidelity at 800-522-7297 if you are a broker-dealer representative, or at
800-843-3001 if you are a bank representative.
We appreciate your support, and look forward to serving you in any way we
can.
Sincerely,
Edward C. Johnson 3d
Chairman and Chief Executive Officer
This letter is intended for investment professional use only, and may not
be reproduced or shown to
the public in oral or written form as sales material.
Q&A IMPORTANT INFORMATION TO HELP
YOU UNDERSTAND THE PROPOSALS
THAT YOU ARE BEING ASKED TO
VOTE ON.
PLEASE READ THE FULL TEXT OF THE ENCLOSED PROXY STATEMENT. BELOW IS A
BRIEF OVERVIEW OF THE MATTERS TO BE VOTED UPON. YOUR VOTE IS IMPORTANT.
IF YOU HAVE ANY QUESTIONS REGARDING THE PROPOSALS PLEASE CALL CLIENT
SERVICES AT 800-522-7297. WE APPRECIATE YOU PLACING YOUR TRUST IN THE
FIDELITY ADVISOR FUNDS AND LOOK FORWARD TO HELPING YOU ACHIEVE YOUR
FINANCIAL GOALS.
Q. WHAT ARE THE BENEFITS OF THE DOLLAR-BASED VOTING RIGHTS PROPOSAL TO
SHAREHOLDERS?
A. The proposed amendment would provide a more equitable distribution of
voting rights for certain votes than the one-share, one-vote system
currently in effect. The voting power of each shareholder would be
measured by the value of the shareholder's dollar investment rather than by
the number of shares held.
Q. WHY IS EQUITY GROWTH FUND ADOPTING AN INVESTMENT POLICY TO PERMIT THE
FUND TO INVEST ALL OF ITS ASSETS IN ANOTHER OPEN-END INVESTMENT COMPANY
WITH SIMILAR INVESTMENT OBJECTIVES AND POLICIES?
A. This proposal will allow Equity Growth Fund to implement a
"master-feeder" fund structure that allows "feeder" funds to invest all of
their assets in a single "master" fund. The purpose of this structure is
to achieve operational efficiencies by consolidating portfolio management
while maintaining different distribution and servicing structures. While
neither FMR nor the Board of Trustees has determined that the fund should
invest in a "master fund", the Board of Trustees believe it could be in the
best interest of the fund to adopt such a structure at a future date.
Q. WHY IS EQUITY GROWTH FUND PROPOSING TO ADOPT AN AMENDED MANAGEMENT
CONTRACT?
A. The amended contract would modify the management fee that FMR receives
by reducing the
individual fund fee rate and by providing for lower fees when FMR's
assets under manage-
ment exceed certain levels (Group Fee Rate). The amended contract will
result in a manage-
ment fee that is lower than the fee payable under the Present Management
Contract. The
Board of Trustees believes that the existing management fee structure is
fair and reasonable
and that the proposed modifications to the management fee are in the best
interests of the
fund's shareholders.
Q. WHY IS EQUITY GROWTH FUND PROPOSING TO AMEND THE SUB-ADVISORY AGREEMENTS
WITH FMR FAR EAST AND FMR U.K.?
A. The proposal will permit FMR not only to receive investment advice and
research services
but also to grant FMR Far East and FMR U.K. investment management
authority. The Board
of Trustees believes that FMR will have increased flexibility in portfolio
manager assign-
ments and will give the fund access to managers located abroad who may
have more special-
ized expertise with respect to local companies and markets. The Proposed
Agreement will
not affect fees paid by the fund to FMR.
Q. WHY IS EQUITY GROWTH FUND PROPOSING TO AMEND ITS DISTRIBUTION AND
SERVICE PLAN ON CLASS T SHARES?
A. The amended Class T Distribution and Service Plan would be identical to
the current plan, with the exception of calculating the daily net assets of
the fund. Under the current plan, for purposes of calculating the
distribution fee, net assets exclude assets attributable to shares
purchased more than 144 months prior to the date on which the daily net
assets are calculated. The new plan will no longer exclude shares held
more than 144 months when calculating the distribution fee. When the
144-month limitation was introduced in the 1980s, expense limitations were
limited to front-end sales charges only. The 144-month limitation was
intended by FMR to result in a limit on total distribution charges
(front-end sales charges plus 12b-1 fees) comparable to the front-end sales
charge limit then imposed by the NASD. During 1993, however, the NASD
established a combined limit on mutual fund sales charges AND distribution
expenses. The NASD rule has become the industry standard for restricting
distribution charges.
Q. WILL THE AMENDMENTS TO CHANGE EACH OF EQUITY GROWTH FUND, MID CAP FUND,
AND LARGE CAP FUND'S FUNDAMENTAL INVESTMENT LIMITATIONS CONCERNING
DIVERSIFICATION AFFECT MY FUND'S INVESTMENT OBJECTIVE?
A. No. The Board of Trustees believes that these proposals are in the best
interest of each fund's shareholders, and will not affect each fund's
investment philosophy. Proposal #12 will give
Equity Growth Fund greater flexibility by permitting it to acquire larger
positions in the
securities of individual issuers. Proposal #13 will allow Equity Growth
Fund, Mid Cap Fund, and Large Cap Fund to invest without limit in the
securities of other investment companies.
Q. WILL THE AMENDMENT TO REPLACE EQUITY GROWTH FUND'S FUNDAMENTAL NAME TEST
POLICY WITH A NON-FUNDAMENTAL POLICY BASED ON TOTAL ASSETS AFFECT MY FUND'S
INVESTMENT OBJECTIVE?
A. The primary purpose of the proposal is to adopt a non-fundamental policy
based on total assets rather than "assets" under the current policy which
is construed to mean net assets. Because the fund's total assets are equal
to or greater than its net assets, the proposed change to a "total assets"
name policy will generally result in an increase in the minimum portion of
the fund's assets required to be invested in common and preferred stock in
order to satisfy the name test. Because under normal circumstances the fund
invests more of its assets in common and preferred stock than is required
under either the existing or proposed name test, this change is not
anticipated to have a material impact on the way the fund is managed.
Q. WHY IS EQUITY GROWTH FUND PROPOSING TO ELIMINATE THE FUND'S
FUNDAMENTAL INVESTMENT POLICY RELATING TO PERMISSIBLE
REPURCHASE AGREEMENT COUNTERPARTIES?
A. The purpose of the proposal is to eliminate Equity Growth's fundamental
policy limiting
those parties with whom it will enter into repurchase agreements.
Elimination of the funda-
mental policy will allow the fund greater flexibility when engaging in
repurchase agreements.
The Board of Trustees believes that this proposal will benefit the fund.
Q. WHY IS EQUITY GROWTH FUND PROPOSING TO AMEND THE FUND'S
FUNDAMENTAL INVESTMENT LIMITATION CONCERNING REAL ESTATE?
A. The purpose of this proposal is to clarify the types of securities in
which the fund is autho-
rized to invest and to conform the fund's fundamental real estate
limitation to a limitation that
is expected to become standard for all funds managed by FMR. Although the
fund does not
expect to acquire real estate, the proposed limitation would clarify the
circumstances by
which the fund can acquire real estate. Adoption of the proposed
limitation concerning real
estate is not expected to significantly affect the way in which the fund
is managed, the invest-
ment performance of the fund, or the securities in which the fund invests.
Q. WHAT DO THE PROPOSALS REGARDING ADOPTION OF STANDARD INVESTMENT
LIMITATIONS IMPLY FOR EQUITY GROWTH FUND?
A. The purpose of proposals 17 through 24 is to revise several of Equity
Growth Fund's investment limitations to conform to limitations which are
standard for similar types of funds managed by FMR. It is not anticipated
that these proposals will substantially affect the way the fund is
currently managed.
Q. THE PROXY SAYS THAT THE FUNDS' BOARD OF TRUSTEES HAS APPROVED THESE
CHANGES. WHAT ROLE DOES THE BOARD PLAY?
A. The trustees continue to oversee the investment policies of the funds.
Members of the Board are fiduciaries and have an obligation to serve the
best interests of the funds' shareholders, including policy changes such as
those proposed for these funds.
Q. HOW DO I VOTE MY SHARES?
A. You can vote your shares by completing and signing the enclosed proxy
card(s), and mailing them in the enclosed postage paid envelope. If you
need any assistance, or have any questions regarding the proposals or how
to vote your shares, please call Fidelity Client Services at 800-522-7297.
ADVI-PXL-0597