EXHIBIT 1.A.(8)(B)
FRANCHISE AGREEMENT
between
Fidelity Destiny Portfolios:
Destiny I and Destiny II
Destiny II Portfolio
and
Fidelity Distributors Corporation
THIS AGREEMENT made this 30th day of December, 1985 between FIDELITY
DESTINY PORTFOLIOS: DESTINY I AND DESTINY II, a Massachusetts business
trust having its principal office in Boston, Massachusetts which may issue
one or more series of beneficial interest (hereinafter called the
"Issuer"), on behalf of Destiny II Portfolio, (hereinafter called the
"Portfolio"), and FIDELITY DISTRIBUTORS CORPORATION, a Massachusetts
corporation, having its principal office in Boston, Massachusetts
(hereinafter called "Distributors").
WITNESSETH:
WHEREAS Distributors has been formed for the purpose, inter alia, of
sponsoring Periodic Payment Plan Certificates based upon open-end
investment company shares and other securities, and is able and desirous of
sponsoring Periodic Payment Plan Certificates based upon Issuer shares as
hereinafter provided; and
WHEREAS Distributors desires to arrange for the acquisition of Issuer
shares for deposit and use under Systematic Investment Plans (hereinafter
sometimes collectively referred to as the "Plans"), of which the STATE
STREET BANK AND TRUST COMPANY will be the Custodian; and
WHEREAS Distributors represents it is a member in good standing of the
National Association of Securities Dealers, Inc.; and
WHEREAS the Issuer is registered under the Investment Company Act of 1940,
as amended (hereinafter called the "1940 Act"), Issuer shares are
registered under the Securities Act of 1933, as amended, (hereinafter
called the "1933 Act") and the Issuer is willing to take the necessary
steps, subject to approval of its shareholders to continue to register
Issuer shares under the 1933 Act to the end that there will be available
for sale such number of Issuer shares as Distributors may reasonably be
expected to sell.
NOW, THEREFORE in consideration of the sum of one dollar and other good
and valuable considerations by each of the parties hereto to the other in
hand paid, the receipt whereof is hereby acknowledged, and the mutual
covenants herein set forth, the parties hereto agree as follows:
1. The Franchise Agreement, for Destiny II Portfolio, is hereby effective
as of the opening of business this date, and relations between the Issuer
and Distributors thereafter will be governed by the terms of this
Agreement.
2. The Issuer agrees to sell upon demand at the net asset value,
determined as provided by the then current prospectus (as determined by
Fidelity Service Co., Boston, Massachusetts, as agent for the Issuer),
which is without imposition of any sales charge, to Distributors, or any
bank or banks acting as Custodian for the Plans sponsored and issued by
Distributors, a sufficient number of Issuer shares to meet the requirements
of all such Plans as are sold, distributed and/or issued by Distributors.
3. The Issuer agrees that it will comply to the best of its ability with
the federal securities laws, and the Issuer agrees it will use its best
efforts to maintain enough shares registered under the 1933 Act to permit
the continued sale of Issuer shares. The Issuer further agrees to make
readily available to Distributors any data, information or material in its
possession that may be necessary to the registration or qualification for
the Plans for sale under the federal securities laws, or the laws of any
state.
4. The Issuer agrees to supply to Distributors or the bank or banks acting
as Custodian for the Plans issued by Distributors a sufficient number of
copies of any and all general mailings, together with the necessary
envelopes, including without limitation, proxy material, proxies, annual,
semi-annual and quarterly reports, notices and prospectuses, sent from time
to time to the holders of Issuer shares so as to provide a single copy,
together with the necessary envelope and postage, to each Distributors'
Planholder. The Issuer agrees to furnish all the above mentioned material
at no cost to Distributors. Additional copies of any current prospectus
and any printed information issued as supplemental to such prospectus of
the Portfolio will be supplied by the Issuer at Distributors' expense in
sufficient quantities to accommodate Distributors in selling, distributing
and/or issuing the Plans. It is understood that Distributors is
wholly-owned by Fidelity Management & Research Company (hereinafter called
"FMR"), investment adviser of the Issuer and that the Issuer's agreement to
supply information and printed materials described in this agreement may be
fulfilled by FMR. Distributors agrees that it will furnish the Portfolio
for its files two copies of all material supplied to Planholders by
Distributors.
5. The Issuer shall indemnify and hold harmless Distributors and each
person, if any, subjected to liability because of connection with
Distributors and their respective successors (all hereinafter in this
paragraph referred to as the "Defendants") against any liability, claims,
damage or expense (including, unless the Issuer elects to assume the
defense, the reasonable cost of investigating and defending any alleged
liability, claim, damage, or expense and reasonable counsel fees in
connection therewith), joint or several, arising by reason of any person
acquiring any Plans for Issuer shares on the ground that the registration
statement or prospectus for shares of the Issuer includes an untrue
statement of a material fact or omits to state a material fact required to
be stated therein or necessary in order to make statements therein not
misleading, unless such statement or omission occurred by reason of a
variance in the prospectus prepared by Distributors from the prospectus as
contained in the composition, etc., supplied by the Issuer or was made in
reliance upon information furnished by Distributors for use therein. In no
case is the indemnity of the Issuer in favor of Distributors or any person
indemnified to be deemed to protect Distributors or any such person against
any liability to the Issuer or its security holders to which Distributors
or any controlling person would otherwise be subject by reason of willful
misfeasance, bad faith or gross negligence in the performance of its duties
under this Agreement. Upon the commencement of any suit against any
Defendant in respect of which indemnity may be sought as aforesaid, such
Defendant shall promptly notify the Issuer, but failure so to notify the
Issuer shall not relieve the Issuer from any liability the Issuer may have
to the Defendants otherwise than on account of said indemnity agreement.
6. Distributors shall indemnify and hold harmless the Issuer and each
person, if any, subjected to liability because of connection with the
Issuer and their respective successors (all hereinafter in this paragraph
referred to as the "Defendants") against any liability, claims, damages, or
expense (including, unless Distributors elects to assume the defense, the
reasonable cost of investigating and defending any alleged liability,
claim, damages or expense and reasonable counsel fees in connection
therewith), joint or several, arising by reason of the sponsorship or
distribution by Distributors of Plans based upon the Issuer shares unless
such liability, claim, damages or expense arise by reason of an untrue
statement of a material fact or omission to state a material fact required
to be stated in the prospectus or registration statement of the Issuer, or
necessary in order to make the statements therein not misleading. In no
case is the indemnity of Distributors in favor of the Issuer or any person
indemnified to be deemed to protect the Issuer or any such person would
otherwise be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties under this Agreement. Upon the
commencement of any suit against any Defendant in respect of which
indemnity may be sought as aforesaid, such Defendant shall promptly notify
Distributors but failure to notify Distributors shall not relieve
Distributors from any liability Distributors may have to the Defendants
otherwise than on account of said indemnity agreement.
7. The Agreement on the part of the Issuer to sell Issuer shares upon
demand, at net asset value set forth in paragraph 2 hereof, is subject to
the following limitations:
(a) That the Plans are maintained in good standing as unit investment
trusts under the federal securities laws, provided, however, that
Distributors reserves the right to change the terms or conditions of, or
suspend or discontinue, any Plans at any time after notification thereof to
the Issuer by letter or prepaid telegram; and
(b) That the membership of Distributors in the National Association of
Securities Dealers, Inc. and its registration as a broker-dealer under the
Securities Exchange Act of 1934, as amended, have not been cancelled,
revoked or suspended; and
(c) That Distributors is not in violation of any of the federal or state
laws and regulations relating to the registration and sale of said Plans.
If Distributors shall, within thirty days after a default under any of the
provisions of this paragraph, cure such default to the reasonable
satisfaction of the Issuer, then the agreement of the Issuer to sell at the
net asset value Issuer shares in accordance with paragraph 2 hereof shall
remain unimpaired, anything in this paragraph 7 to the contrary
notwithstanding.
8. This Agreement shall have a term of two years from the effective date
of the registration of the Plans under the 1933 Act. Thereafter this
Agreement shall continue from year to year, unless either party shall serve
a notice upon the other by certified or registered mail, return receipt
requested, 120 days prior to the end of the year after which termination is
desired, cancelling this Agreement, provided that it shall be approved by
the directors or shareholders of the Issuer as required by Section 15 of
the 1940 Act. Notwithstanding to the termination of this Agreement, the
Issuer agrees to sell sufficient Issuer shares to Distributors or any bank
or banks acting as Custodian for the Plans to permit completion of all
Plans begun prior to such termination. Distributors represents and agrees
that it will use its best efforts to sell Plans based upon Issuer shares
throughout the term of this Agreement.
9. Distributors or any bank or banks acting as Custodian for the Plans may
from time to time substitute a new investment medium for the Issuer shares
in accordance with the provisions of the Plan certificate and prospectus in
effect at the time.
10. All communications provided for hereunder shall be in writing and
shall be deemed to have been duly given if delivered or mailed by first
class mail prepaid (unless delivery by certified or registered mail, return
receipt requested, is provided for) to the respective parties as follows:
Fidelity Destiny Portfolios: Fidelity Distributors Corporation
Destiny II ▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
or to such other address as the Issuer or Distributors designates by
written notice to that effect to the other.
11. This Agreement contains the entire understanding between the parties
and any modification, alteration, change or subsequent agreement hereafter
made shall be ineffective to change, modify or discharge this Agreement in
whole or in part unless such modification, alteration, change or subsequent
agreement is in writing and signed by the party against whom enforcement of
the change, modification, discharge or alteration is sought.
12. This Agreement shall be construed in accordance with the laws of
Massachusetts.
13. This Agreement shall be binding upon and enforceable by and shall bind
and inures to the benefit of the Issuer and Distributors and their
respective heirs, executors, administrators, successors and assigns.
14. Distributors is expressly put on notice of the limitation of
shareholder liability as set forth in Article XI Section 3 of the
"Declaration of Trust" 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 and Distributors shall not seek satisfaction of
any obligation from the shareholders or any shareholder of the Issuer. Nor
shall Distributors seek satisfaction of any obligations from the trustees
or any individual trustee of the Issuer.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed, all as of the day and year first above written.
FIDELITY DESTINY PORTFOLIOS:
DESTINY I AND DESTINY II on behalf
of Destiny II Portfolio
By /s/J. ▇▇▇▇ ▇▇▇▇▇▇▇▇
President
WITNESS:
/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ FIDELITY DISTRIBUTORS CORPORATION
Secretary
By /s/▇▇▇▇ ▇. ▇'▇▇▇▇▇
President
ATTEST:
/s/▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Clerk