Securities Act File No. 333-47011
Investment Company Act File No. 811-08673
==========================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 /X/
Pre-Effective Amendment No. __ / /
Post-Effective Amendment No. 3 /X/
and
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 /X/
Amendment No. 3 /X/
(Check appropriate box or boxes)
DREYFUS INVESTMENT PORTFOLIOS
(Exact Name of Registrant as Specified in Charter)
c/o The Dreyfus Corporation
200 Park Avenue, New York, New York 10166
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 922-6130
Mark N. Jacobs, Esq.
200 Park Avenue
New York, New York 10166
(Name and Address of Agent for Service)
copy to:
Lewis G. Cole, Esq.
Stroock & Stroock & Lavan LLP
180 Maiden Lane
New York, New York 10038-4982
It is proposed that this filing will become effective (check
appropriate box)
____ immediately upon filing pursuant to paragraph (b)
____ on (date) pursuant to paragraph (b)
____ 60 days after filing pursuant to paragraph (a)(i)
_X__ on May 1, 1999 pursuant to paragraph (a)(i)
____ 75 days after filing pursuant to paragraph (a)(ii)
____ on (date) pursuant to paragraph (a)(ii) 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.
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DREYFUS INVESTMENT PORTFOLIOS
CORE VALUE PORTFOLIO
MIDCAP STOCK PORTFOLIO
PROSPECTUS May 1, 1999
DREYFUS [LOGO]
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
<PAGE>
CONTENTS
DREYFUS INVESTMENT PORTFOLIOS
- -------------------------------------------------------------------------------
Core Value Portfolio
Goal/Approach
Main Risks
Past Performance
Expenses
MidCap Stock Portfolio
Goal/Approach
Main Risks
Past Performance
Expenses
Management
Financial Highlights
BUY/SELL SHARES
- -------------------------------------------------------------------------------
Account Policies
Distributions and Taxes
FOR MORE INFORMATION
- -------------------------------------------------------------------------------
Information on the portfolios' recent
strategies and holdings can be found in
the current annual/semiannual report. See
back cover.
Shares of the portfolios are offered only to separate accounts established by
insurance companies to fund variable annuity contracts ("VA contracts") and
variable life insurance policies ("VLI policies") and to qualified pension and
retirement plans and accounts permitting accumulation of assets on a
tax-deferred basis ("Eligible Plans"). Individuals may not purchase shares
directly from the fund. The VA contracts and the VLI policies are described in
the separate prospectuses issued by the participating insurance companies over
which the fund assumes no responsibility.
Each portfolio has its own investment strategy and risk/return profile. The
differences in strategy between the portfolios determine the types of securities
in which each portfolio invests and can be expected to affect the degree of risk
each portfolio is subject to and its performance.
The investment objective and policies of a portfolio may be similar to those of
other funds managed by the investment adviser. However, the investment results
of the portfolios may be higher or lower than, and may not be comparable to,
those of such other funds.
<PAGE>
CORE VALUE PORTFOLIO
- --------------------
Ticker Symbol: xxxx
[ICON] GOAL/APPROACH
The Core Value Portfolio seeks long-term growth of capital, with current income
as a secondary objective. To pursue this goal, it invests primarily in stocks of
large-cap value companies (market capitalizations of $1 billion and above). The
portfolio typically will invest mainly in the stocks of U.S. issuers, and will
limit its foreign stock holdings to 20% of the value of its assets. The
portfolio's stock investments may include common stocks, preferred stocks,
convertible securities and depositary receipts.
In choosing stocks, the portfolio management team focuses on individual stock
selection (a "bottom-up" approach) rather than forecasting stock market trends
(a "top-down" approach), and looks for value companies. A three-step value
screening process is used to seek out investments with strong growth prospects
while managing risk:
o VALUE: quantitative screens track traditional measures such as
price-to-earnings, price-to-book and price-to-sales. These ratios
are analyzed and compared against the market.
o SOUND BUSINESS FUNDAMENTALS: a company's balance sheet and income
data are examined to determine the company's financial history.
o POSITIVE BUSINESS MOMENTUM: a company's earnings and forecast
changes are analyzed and sales and earnings trends are revised to
determine the company's financial condition.
The portfolio typically sells a stock when it is no longer considered a value
company, appears less likely to benefit from the current market and economic
environment, shows deteriorating fundamentals or falls short of the management
team's expectations.
[LEFT SIDE BAR]
CONCEPTS TO UNDERSTAND
VALUE COMPANIES: companies that appear underpriced according to certain
financial measurements of their intrinsic worth or business prospects (such as
price-to-earnings or price-to-book ratios). Because a stock can remain
undervalued for years, value investors often look for factors that could trigger
a rise in price.
LARGE-CAP COMPANIES: established companies that are considered "known
quantities." Large-cap companies often have the resources to weather economic
shifts, though they can be slower to innovate than small companies.
---------------------
[ICON] MAIN RISKS
While stocks have historically been a leading choice of long-term investors,
they do fluctuate in price. The value of a shareholder's investment in the
portfolio will go up and down, which means that shareholders could lose money.
Value stocks involve the risk that they may never reach what the management team
believes is their full market value, either because the market fails to
recognize the stock's intrinsic worth or the management team misgauged that
worth. They also may decline in price, even though in theory they are already
underpriced. Because different types of stocks tend to shift in and out of favor
depending on market and economic conditions, the portfolio's performance may
sometimes be lower or higher than that of other types of funds (such as those
emphasizing growth stocks).
Any foreign securities purchased by the portfolio include special risks, such as
exposure to currency fluctuations, changing political climate, lack of adequate
company information and potentially less liquidity.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could have the effect of reducing the benefit from any upswing in the
market.
[SIDE BAR]
OTHER POTENTIAL RISKS
The portfolio may invest some assets in derivative securities, such as options
and futures, and in foreign currencies. These practices are used primarily to
hedge the portfolio but may be used to increase returns; however, such practices
sometimes may reduce returns or increase volatility. Derivatives can be
illiquid, and a small investment in certain derivatives could have a potentially
large impact on the portfolio's performance.
At times, the portfolio may engage in short-term trading, which could produce
higher brokerage costs and taxable distributions.
The portfolio can buy securities with borrowed money (a form of leverage), which
could have the effect of magnifying the portfolio's gains or losses.
<PAGE>
PAST PERFORMANCE
Since the portfolio has less than one calendar year of performance, average
annual total return information for the portfolio is not included in the
prospectus.
[SIDE BAR]
WHO ARE THE SHAREHOLDERS
The participating insurance companies and their separate accounts and the
Eligible Plans are the shareholders of the portfolio. From time to time, a
shareholder may own a substantial number of portfolio shares the sale of which
would adversely affect the portfolio's net asset value per share (NAV).
WHAT THE PORTFOLIO IS AND ISN'T
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives you the opportunity to participate in financial markets. It
strives to reach its stated goal, although as with all mutual funds, it cannot
offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
----------------------------------
<PAGE>
[ICON] EXPENSES
As an investor, you pay certain fees and expenses in connection with the
portfolio, which are described in the table below. Annual portfolio operating
expenses are paid out of portfolio assets, so their effect is included in the
portfolio's share price. The information in the table does not reflect account
fees and charges to separate accounts or related VA contracts and VLI policies
that may be imposed by participating insurance companies or any charges imposed
by Eligible Plans.
ANNUAL PORTFOLIO OPERATING EXPENSES
AS A % OF AVERAGE DAILY NET ASSETS
Management fees 0.75%
Other expenses ____%
- -------------------------------------------------------------------------------
TOTAL ____%
EXPENSE EXAMPLE
1 year................................ $___
3 years............................... $___
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only.
[LEFT SIDE BAR]
CONCEPTS TO UNDERSTAND
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<PAGE>
MIDCAP STOCK PORTFOLIO
- ----------------------
Ticker Symbol: xxxx
[ICON] GOAL/APPROACH
The MidCap Stock Portfolio seeks to provide investment results that are greater
than the total return performance of publicly-traded common stocks of
medium-size domestic companies in the aggregate, as represented by the Standard
& Poor's MidCap 400 Index(R) ("S&P 400"). To pursue its goal, the portfolio
invests primarily in a blended portfolio of growth and value stocks of
medium-size companies, those whose market values range between $200 million and
$5 billion. Stocks are chosen through a disciplined process combining computer
modeling techniques, fundamental analysis and risk management. Consistency of
returns and stability of the portfolio's share price compared to the S&P 400 are
primary goals of the process. The portfolio's stock investments may include
common stocks, preferred stocks, convertible securities and depositary receipts.
Dreyfus uses a computer model to identify and rank stocks within an industry or
sector based on:
o value, or how a stock is priced relative to its perceived
intrinsic worth
o growth, in this case the sustainability or growth of earnings
o financial profile, which measures the financial health of the
company
Next, Dreyfus uses fundamental analysis to select the most attractive of the
top-ranked securities, drawing on information technology as well as Wall Street
sources and company management.
Then, Dreyfus manages risk by diversifying across companies and industries,
limiting the potential adverse impact from any one stock or industry. The
portfolio is structured so that its sector weightings and risk characteristics,
such as growth, size, quality and yield, are similar to those of the S&P 400.
[LEFT SIDE BAR]
CONCEPTS TO UNDERSTAND
MID-CAP COMPANIES: established companies that may not be well known. Mid-cap
companies have the potential to grow faster than large-cap companies, but may
lack the resources to weather economic shifts, and are more volatile than large
companies.
COMPUTER MODEL: a proprietary computer model that evaluates and ranks a universe
of 2,000 stocks. Dreyfus reviews each of the screens on a regular basis. Dreyfus
also maintains the flexibility to adapt the screening criteria to changes in
market and economic conditions.
[ICON] MAIN RISKS
While stocks have historically been a leading choice of long-term investors,
they do fluctuate in price. The value of a shareholder's investment in the
portfolio will go up and down, which means that shareholders could lose money.
Medium-size companies carry additional risks because their earnings tend to be
less predictable, their share prices more volatile and their securities less
liquid than larger, more established companies. Some of the portfolio's
investments will rise and fall based on investor perception rather than
economics.
Although the portfolio seeks to manage risk by broadly diversifying among
industries and by maintaining a risk profile very similar to the S&P 400, the
portfolio is expected to hold fewer securities than the index. Owning fewer
securities and the ability to purchase stocks of companies not listed in the S&P
400 can cause the portfolio to underperform the index. By investing in a mix of
growth and value companies, the portfolio assumes the risks of both and may
achieve more modest gains than funds that use only one investment style. Because
the stock prices of growth companies are based in part on future expectations,
they may fall sharply if earnings expectation are not met or investors believe
the prospects for a stock, industry or the economy in general are weak. Growth
stocks also typically lack the dividend yield that could cushion stock prices in
market downturns. With value stocks, there is the risk that they may never reach
what the manager believes is their full market value, or that their intrinsic
values may fall. While investments in value stocks may limit downside risk over
time, they may produce smaller gains than riskier stocks.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could have the effect of reducing the benefit from any upswing in the
market.
---------------------
[SIDE BAR]
OTHER POTENTIAL RISKS
The portfolio may invest some assets in derivative securities, such as options
and futures. These practices are used primarily to hedge the portfolio but may
be used to increase returns; however, such practices sometimes may reduce
returns or increase volatility. Derivatives can be illiquid, and a small
investment in certain derivatives could have a potentially large impact on the
portfolio's performance.
The portfolio can buy securities with borrowed money (a form of leverage), which
could have the effect of magnifying the portfolio's gains or losses.
<PAGE>
----------------------------------
PAST PERFORMANCE
Since the portfolio has less than one calendar year of performance, average
annual total return information for the portfolio is not included in the
prospectus.
[SIDE BAR]
WHO ARE THE SHAREHOLDERS
The participating insurance companies and their separate accounts and the
Eligible Plans are the shareholders of the portfolio. From time to time, a
shareholder may own a substantial number of portfolio shares the sale of which
would adversely affect the portfolio's NAV.
WHAT THE PORTFOLIO IS AND ISN'T
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives you the opportunity to participate in financial markets. It
strives to reach its stated goal, although as with all mutual funds, it cannot
offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
----------------------------------
<PAGE>
[ICON] EXPENSES
As an investor, you pay certain fees and expenses in connection with the
portfolio, which are described in the table below. Annual portfolio operating
expenses are paid out of portfolio assets, so their effect is included in the
portfolio's share price. The information in the table does not reflect account
fees and charges to separate accounts or related VA contracts and VLI policies
that may be imposed by participating insurance companies or any charges imposed
by Eligible Plans.
ANNUAL PORTFOLIO OPERATING EXPENSES
AS A % OF AVERAGE DAILY NET ASSETS
Management fees 0.75%
Other expenses ____%
- -------------------------------------------------------------------------------
TOTAL ____%
EXPENSE EXAMPLE
1 year............................ $____
3 years........................... $____
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only.
[LEFT SIDE BAR]
CONCEPTS TO UNDERSTAND
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<PAGE>
[ICON] MANAGEMENT
The investment adviser for the fund is The Dreyfus Corporation, 200 Park Avenue,
New York, New York 10166. Founded in 1947, Dreyfus manages one of the nation's
leading mutual fund complexes, with more than $121 billion in over 160 mutual
fund portfolios. Dreyfus is the primary mutual fund business of Mellon Bank
Corporation, a broad-based financial services company with a bank at its core.
With more than $350 billion of assets under management and $1.7 trillion of
assets under administration and custody, Mellon provides a full range of
banking, investment and trust products and services to individuals, businesses
and institutions. Its mutual fund companies place Mellon as the leading bank
manager of mutual funds. Mellon is headquartered in Pittsburgh, Pennsylvania.
MANAGEMENT PHILOSOPHY
The Dreyfus asset management philosophy is based on the belief that discipline
and consistency are important to investment success. For each portfolio, Dreyfus
seeks to establish clear guidelines for portfolio management and to be
systematic in making decisions. This approach is designed to provide each
portfolio with a distinct, stable identity.
PORTFOLIO MANAGERS
The primary portfolio managers of the portfolios are as follows:
o CORE VALUE PORTFOLIO: Investment decisions for the Core Value Portfolio
are made by a committee of Dreyfus portfolio managers, and no person is
primarily responsible for making recommendations to the committee. Members
of the committee also comprise the Equity Policy Group of The Boston
Company Asset Management, Inc., which is an indirect wholly-owned
subsidiary of Mellon and, thus, an affiliate of Dreyfus.
o MIDCAP STOCK PORTFOLIO: John O'Toole is the portfolio's primary portfolio
manager, a position he has held since the portfolio's inception, and has
been employed by Dreyfus since October 1994. Mr. O'Toole also is a Senior
Vice President and a Portfolio Manager for Mellon Equity Associates, a
wholly-owned subsidiary of Mellon and, thus, an affiliate of Dreyfus, and
has been employed by Mellon Bank, N.A. since 1979.
[SIDE BAR]
CONCEPTS TO UNDERSTAND
YEAR 2000 ISSUES: the portfolios could be adversely affected if the computer
systems used by Dreyfus and the portfolios' other service providers do not
properly process and calculate date-related information from and after January
1, 2000.
Dreyfus is working to avoid year 2000-related problems in its systems and to
obtain assurances from other service providers that they are taking similar
steps. In addition, issuers of securities in which the portfolios invest may be
adversely affected by year 2000-related problems. This could have an impact on
the value of a portfolio's investments and its share price.
<PAGE>
----------------------------------
[ICON] FINANCIAL HIGHLIGHTS
The following tables describe each portfolio's performance for the fiscal
periods indicated. "Total return" shows how much your investment in the
portfolio would have increased (or decreased) during each period, assuming you
had reinvested all dividends and distributions. These figures have been
independently audited by ______________, whose report, along with the
portfolios' financial statements, is included in the annual report. The total
investment return information set forth below does not reflect certain expenses
charged the separate accounts or related VA contracts and VLI policies by the
participating insurance companies or any charges imposed by Eligible Plans, the
inclusion of which would reduce the portfolios' total investment return for each
period indicated.
[To be provided by amendment]
----------------------------------
<PAGE>
[ICON] ACCOUNT POLICIES
BUYING SHARES
Portfolio shares are offered only to separate accounts of participating
insurance companies and Eligible Plans. Individuals may not purchase shares
directly from the portfolios. VA contract holders and VLI policy holders should
consult the applicable prospectus of the separate account of the participating
insurance company and Eligible Plan participants should consult the Plan's
administrator or trustee for more information about buying portfolio shares.
The price for portfolio shares is the portfolio's NAV, which is generally
calculated as of the close of trading on the New York Stock Exchange (usually
4:00 p.m. Eastern time) every day the exchange is open. Purchase orders from
separate accounts received in proper form by the participating insurance company
or from Eligible Plans on a given business day are priced at the NAV calculated
on such day, provided that the order and Federal Funds (monies of member banks
within the Federal Reserve System which are held on deposit at a Federal Reserve
Bank) in the net amount of such order are received by the portfolio in proper
form on the next business day. The participating insurance company or Eligible
Plan administrator or trustee is responsible for properly transmitting purchase
orders and Federal Funds.
Wire payments may be made if the bank account of the participating insurance
company or Eligible Plan is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/DREYFUS INVESTMENT PORTFOLIOS: NAME OF PORTFOLIO), for purchase
of portfolio shares. The wire must include the portfolio account number (for new
accounts, a taxpayer identification number should be included instead), account
registration and dealer number if applicable of the participating insurance
company or Eligible Plan.
Each portfolio's investments are generally valued based on market value, or
where market quotations are not readily available, based on fair value as
determined in good faith by the fund's board.
SELLING SHARES
Portfolio shares may be sold (redeemed) at any time by the separate accounts of
the participating insurance companies or by Eligible Plans. Individuals may not
place sell orders directly with the portfolios. Redemption orders from separate
accounts received in proper form by the participating insurance company or from
Eligible Plans on a given business day are priced at the NAV calculated on such
day, provided that the orders are received by the portfolio in proper form on
the next business day. The participating insurance company or Eligible Plan
administrator or trustee is responsible for properly transmitting redemption
orders. VA contract holders and VLI policy holders should consult the applicable
prospectus of the separate account of the participating insurance company and
Eligible Plan participants should consult the Plan's administrator or trustee
for more information about selling portfolio shares.
<PAGE>
[ICON] DISTRIBUTIONS AND TAXES
Each portfolio generally pays dividends from net investment income and
distributes any net capital gains it has realized once a year.
Distributions will be reinvested in additional shares of the relevant portfolio
unless instructed otherwise by a participating insurance company or Eligible
Plan.
Since each portfolio's shareholders are the participating insurance companies
and their separate accounts and Eligible Plans, the tax treatment of dividends
and distributions will depend on the tax status of the participating insurance
company or Eligible Plan. Accordingly, no discussion is included as to the
federal income tax consequences to VA contract holders, VLI policy holders and
Eligible Plan participants. For this information, VA contract holders and VLI
policy holders should consult the applicable prospectus of the separate account
of the participating insurance company and Eligible Plan participants should
consult the Plan's administrator or trustee.
Participating insurance companies and Eligible Plans should consult their tax
advisers about federal, state and local tax consequences.
<PAGE>
FOR MORE INFORMATION
DREYFUS INVESTMENT PORTFOLIOS
o Core Value Portfolio
o MidCap Stock Portfolio
- --------------------------------
SEC file number: 811-08673
More information on this fund and its portfolios is available free
upon request, including the following:
ANNUAL/SEMIANNUAL REPORT
Describes each portfolio's performance, lists portfolio holdings and
contains a letter from the portfolio manager discussing recent market
conditions, economic trends and portfolio strategies that significantly affected
the portfolio's performance during the last fiscal year.
STATEMENT OF ADDITIONAL INFORMATION (SAI)
Provides more details about the portfolios and their policies. A
current SAI is on file with the Securities and Exchange Commission (SEC) and is
incorporated by reference (is legally considered part of this prospectus).
[SIDE BAR]
TO OBTAIN INFORMATION:
BY TELEPHONE
Call 1-800-___-____
BY MAIL Write to:
The Dreyfus Family of Funds
Attn: Institutional Servicing
144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144
BY E-MAIL Send your request to [email protected]
ON THE INTERNET Text-only versions of fund documents can be viewed
online or downloaded from:
SEC
http://www.sec.gov
DREYFUS
http://www.dreyfus.com
You can also obtain copies by visiting the SEC's Public Reference Room
in Washington, DC (phone 1-800-SEC-0330) or by sending your request and a
duplicating fee to the SEC's Public Reference Section, Washington, DC
20549-6009.
(C) 1999, Dreyfus Service Corporation
<PAGE>
DREYFUS INVESTMENT PORTFOLIOS
FOUNDERS GROWTH PORTFOLIO
FOUNDERS INTERNATIONAL EQUITY PORTFOLIO
FOUNDERS PASSPORT PORTFOLIO
PROSPECTUS May 1, 1999
DREYFUS [LOGO]
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
<PAGE>
CONTENTS
DREYFUS INVESTMENT PORTFOLIOS
- -------------------------------------------------------------------------------
Founders Growth Portfolio
Goal/Approach
Main Risks
Past Performance
Expenses
Founders International Equity Portfolio
Goal/Approach
Main Risks
Past Performance
Expenses
Founders Passport Portfolio
Goal/Approach
Main Risks
Past Performance
Expenses
Management
Financial Highlights
BUY/SELL SHARES
- -------------------------------------------------------------------------------
Account Policies
Distributions and Taxes
FOR MORE INFORMATION
- -------------------------------------------------------------------------------
Information on the portfolios' recent
strategies and holdings can be found in
the current annual/semiannual report. See
back cover.
Shares of the portfolios are offered only to separate accounts established by
insurance companies to fund variable annuity contracts ("VA contracts") and
variable life insurance policies ("VLI policies") and to qualified pension and
retirement plans and accounts permitting accumulation of assets on a
tax-deferred basis ("Eligible Plans"). Individuals may not purchase shares
directly from the fund. The VA contracts and the VLI policies are described in
the separate prospectuses issued by the participating insurance companies over
which the fund assumes no responsibility.
Each portfolio has its own investment strategy and risk/return profile. The
differences in strategy among the portfolios determine the types of securities
in which each portfolio invests and can be expected to affect the degree of risk
each portfolio is subject to and its performance.
The investment objective and policies of a portfolio may be similar to those of
other funds managed by the investment advisers. However, the investment results
of the portfolios may be higher or lower than, and may not be comparable to,
those of such other funds.
<PAGE>
FOUNDERS GROWTH PORTFOLIO
- -------------------------
Ticker Symbol: xxxx
[ICON] GOAL/APPROACH
The Founders Growth Portfolio seeks long-term growth of capital. To pursue this
goal, it invests primarily in equity securities of well-established, high
quality "growth" companies. These companies tend to have strong performance
records, solid market positions and reasonable financial strength, and have
continuous operating records of three years or more.
The portfolio managers will seek investment opportunities for the portfolio
generally in companies which they believe have fundamental strengths indicating
the potential for growth in earnings per share. The portfolio managers focus on
individual stock selection (a "bottom-up" approach) rather than on forecasting
stock market trends (a "top-down" approach).
The portfolio may invest up to 30% of its assets in foreign securities, and up
to 25% of its assets in any one foreign country. The portfolio also may invest
in investment grade debt securities of domestic or foreign issuers that the
portfolio managers believe, based on market conditions, the financial condition
of the issuer, general economic conditions, and other relevant factors, offer
opportunities for capital growth.
[SIDE BAR]
CONCEPTS TO UNDERSTAND
GROWTH COMPANIES: companies whose earnings are expected to grow faster than the
overall market. Often, growth stocks have relatively high price-to-earnings and
price-to-book ratios, and tend to be more volatile than value stocks.
EQUITY SECURITIES: common stocks, preferred stocks and convertible securities.
The portfolio will invest in preferred stocks and convertible securities that
are rated at the time of purchase at least B by a credit rating agency or the
unrated equivalent as determined by the portfolio's sub-adviser.
---------------------
[ICON] MAIN RISKS
While stocks have historically been a leading choice of long-term investors,
they do fluctuate in price. The value of a shareholder's investment in the
portfolio will go up and down, which means that shareholders could lose money.
While the portfolio's investments in stocks of well-established companies may
limit the overall downside risk of the portfolio over time, the portfolio may
produce more modest gains than riskier stock funds as a trade-off for this
potentially lower-risk.
Growth companies are expected to increase their earnings at a certain rate. If
these expectations are not met, investors can punish the stocks inordinately --
even if earnings showed an absolute increase. In addition, growth stocks
typically lack the dividend yield that can cushion stock prices in market
downturns.
Any foreign securities purchased by the portfolio include special risks, such as
exposure to currency fluctuations, changing political climate, lack of adequate
company information and potentially less liquidity.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could have the effect of reducing the benefit from any upswing in the
market.
[SIDE BAR]
OTHER POTENTIAL RISKS
The portfolio may invest some assets in derivative securities, such as options
and futures, and in foreign currencies. These practices are used primarily to
hedge the portfolio but may be used to increase returns; however, such practices
sometimes may reduce returns or increase volatility. Derivatives can be
illiquid, and a small investment in certain derivatives could have a potentially
large impact on the portfolio's performance. At times, the portfolio may engage
in short-term trading, which could produce higher brokerage costs and taxable
distributions.
<PAGE>
----------------------------------
PAST PERFORMANCE
Since the portfolio has less than one calendar year of performance, average
annual total return information for the portfolio is not included in this
section of the prospectus.
[SIDE BAR]
WHO ARE THE SHAREHOLDERS
The participating insurance companies and their separate accounts and the
Eligible Plans are the shareholders of the portfolio. From time to time, a
shareholder may own a substantial number of portfolio shares the sale of which
would adversely affect the portfolio's net asset value per share (NAV).
WHAT THE PORTFOLIO IS AND ISN'T
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives you the opportunity to participate in financial markets. It
strives to reach its stated goal, although as with all mutual funds, it cannot
offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
----------------------------------
<PAGE>
[ICON] EXPENSES
As an investor, you pay certain fees and expenses in connection with the
portfolio, which are described in the table below. Annual portfolio operating
expenses are paid out of portfolio assets, so their effect is included in the
portfolio's share price. The information in the table does not reflect account
fees and charges to separate accounts or related VA contracts and VLI policies
that may be imposed by participating insurance companies or any charges imposed
by Eligible Plans.
ANNUAL PORTFOLIO OPERATING EXPENSES
AS A % OF AVERAGE DAILY NET ASSETS
Management fees 0.75%
Other expenses ____%
- -------------------------------------------------------------------------------
TOTAL ____%
EXPENSE EXAMPLE
1 year.............................. $____
3 years............................. $____
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only.
[ LEFT SIDE BAR]
CONCEPTS TO UNDERSTAND
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<PAGE>
FOUNDERS INTERNATIONAL EQUITY PORTFOLIO
- ---------------------------------------
Ticker Symbol: xxxx
[ICON] GOAL/APPROACH
The Founders International Equity Portfolio seeks long-term growth of capital.
To pursue this goal, it invests primarily in equity securities of foreign
issuers which are characterized as "growth" companies.
The portfolio manager will seek investment opportunities for the portfolio
generally in companies which he believes have fundamental strengths indicating
the potential for growth in earnings per share. The portfolio manager focuses on
individual stock selection (a "bottom-up" approach) rather than on forecasting
stock market trends (a "top-down" approach).
The portfolio will invest in foreign issuers from at least three foreign
countries with established or emerging economies, but will not invest more than
50% of its assets in issuers in any one foreign country. The portfolio also may
invest in investment grade debt securities of foreign issuers that the portfolio
manager believes, based on markert conditions, the financial condition of the
issuer, general economic conditions, and other relevant factors, offer
opportunities for capital growth.
[SIDE BAR]
CONCEPTS TO UNDERSTAND
GROWTH COMPANIES: companies whose earnings are expected to grow faster than the
overall market. Often, growth stocks have relatively high price-to-earnings and
price-to-book ratios, and tend to be more volatile than value stocks.
EQUITY SECURITIES: common stocks, preferred stocks and convertible securities.
The portfolio will invest in preferred stocks and convertible securities that
are rated at the time of purchase at least B by a credit rating agency or the
unrated equivalent as determined by the portfolio's sub-adviser.
---------------------
[ICON] MAIN RISKS
The portfolio's performance will be influenced by political, social and economic
factors affecting companies in foreign countries. Like the stocks of U.S.
companies, the securities of foreign issuers fluctuate in price, often based on
factors unrelated to the issuers' value, and such fluctuations can be
pronounced. Unlike investing in U.S. companies, foreign securities include
special risks such as exposure to currency fluctuations, a lack of adequate
company information, political instability, and differing auditing and legal
standards. The value of a shareholder's investment in the portfolio will go up
and down, which means that shareholders could lose money.
Growth companies are expected to increase their earnings at a certain rate. If
these expectations are not met, investors can punish the stocks inordinately --
even if earnings showed an absolute increase. In addition, growth stocks
typically lack the dividend yield that can cushion stock prices in market
downturns.
The portfolio expects to invest primarily in the stocks of companies located in
developed countries. However, the portfolio may invest in the stocks of
companies located in emerging markets. These countries generally have economic
structures that are less diverse and mature, and political systems that are less
stable, than those of developed countries. Emerging markets may be more volatile
than the markets of more mature economies and the securities of companies
located in emerging markets are often subject to rapid and large changes in
price; however, these markets also may provide higher long-term rates of return.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could have the effect of reducing the benefit from any upswing in the
market.
[SIDE BAR]
OTHER POTENTIAL RISKS
The portfolio may invest some assets in derivative securities, such as options
and futures, and in foreign currencies. These practices are used primarily to
hedge the portfolio but may be used to increase returns; however, such practices
sometimes may reduce returns or increase volatility. Derivatives can be
illiquid, and a small investment in certain derivatives could have a potentially
large impact on the portfolio's performance. At times, the portfolio may engage
in short-term trading, which could produce higher brokerage costs and taxable
distributions.
<PAGE>
----------------------------------
PAST PERFORMANCE
Since the portfolio has less than one calendar year of performance, average
annual total return information for the portfolio is not included in this
section of the prospectus.
[SIDE BAR]
WHO ARE THE SHAREHOLDERS
The participating insurance companies and their separate accounts and the
Eligible Plans are the shareholders of the portfolio. From time to time, a
shareholder may own a substantial number of portfolio shares the sale of which
would adversely affect the portfolio's NAV.
WHAT THE PORTFOLIO IS AND ISN'T
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives you the opportunity to participate in financial markets. It
strives to reach its stated goal, although as with all mutual funds, it cannot
offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
----------------------------------
<PAGE>
[ICON] EXPENSES
As an investor, you pay certain fees and expenses in connection with the
portfolio, which are described in the table below. Annual portfolio operating
expenses are paid out of portfolio assets, so their effect is included in the
portfolio's share price. The information in the table does not reflect account
fees and charges to separate accounts or related VA contracts and VLI policies
that may be imposed by participating insurance companies or any charges imposed
by Eligible Plans.
ANNUAL PORTFOLIO OPERATING EXPENSES
AS A % OF AVERAGE DAILY NET ASSETS
Management fees 1.00%
Other expenses ____%
- -------------------------------------------------------------------------------
TOTAL ____%
EXPENSE EXAMPLE
1 year............................... $____
3 years.............................. $____
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only.
[LEFT SIDE BAR]
CONCEPTS TO UNDERSTAND
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<PAGE>
FOUNDERS PASSPORT PORTFOLIO
- ---------------------------
Ticker Symbol: xxxx
[ICON] GOAL/APPROACH
The Founders Passport Portfolio seeks capital appreciation. To pursue this goal,
it invests primarily in equity securities of foreign issuers with market
capitalizations or annual revenues of $1 billion or less and which are
characterized as "growth" companies.
The portfolio manager will seek investment opportunities for the portfolio
generally in companies which he believes have fundamental strengths indicating
the potential for growth in earnings per share. The portfolio manager focuses on
individual stock selection (a "bottom-up" approach) rather than on forecasting
stock market trends (a "top-down" approach).
The portfolio will invest in foreign issuers from at least three foreign
countries with established or emerging economies. The portfolio may invest in
securities of larger foreign issuers or in U.S. issuers if the portfolio manager
believes these securities offer attractive opportunities for capital
appreciation.
The portfolio also may invest in investment grade debt securities of domestic or
foreign issuers that the portfolio manager believes, based on market conditions,
the financial condition of the issuer, general economic conditions, and other
relevant factors, offer opportunities for capital appreciation.
[SIDE BAR]
CONCEPTS TO UNDERSTAND
GROWTH COMPANIES: companies whose earnings are expected to grow faster than the
overall market. Often, growth stocks have relatively high price-to-earnings and
price-to-book ratios, and tend to be more volatile than value stocks.
EQUITY SECURITIES: common stocks, preferred stocks and convertible securities.
The portfolio will invest in preferred stocks and convertible securities that
are rated at the time of purchase at least B by a credit rating agency or the
unrated equivalent as determined by the portfolio's sub-adviser.
---------------------
[ICON] MAIN RISKS
The portfolio's performance will be influenced by political, social and economic
factors affecting companies in foreign countries. Like the stocks of U.S.
companies, the securities of foreign issuers fluctuate in price, often based on
factors unrelated to the issuers' value, and such fluctuations can be
pronounced. Unlike investing in U.S. companies, foreign securities include
special risks such as exposure to currency fluctuations, a lack of adequate
company information, political instability, and differing auditing and legal
standards. The value of a shareholder's investment in the portfolio will go up
and down, which means that shareholders could lose money.
Growth companies are expected to increase their earnings at a certain rate. If
these expectations are not met, investors can punish the stocks inordinately --
even if earnings showed an absolute increase. In addition, growth stocks
typically lack the dividend yield that can cushion stock prices in market
downturns.
The portfolio expects to invest primarily in the stocks of companies located in
developed countries. However, the portfolio may invest in the stocks of
companies located in emerging markets. These countries generally have economic
structures that are less diverse and mature, and political systems that are less
stable, than those of developed countries. Emerging markets may be more volatile
than the markets of more mature economies and the securities of companies
located in emerging markets are often subject to rapid and large changes in
price; however, these markets also may provide higher long-term rates of return.
The portfolio may invest in securities issued by companies with relatively small
market capitalizations. Smaller companies typically carry additional risks
because their earnings tend to be less predictable, their share prices more
volatile and their securities less liquid than larger, more-established
companies.
Under adverse market conditions, the portfolio could invest some or all of its
assets in money market securities. Although the portfolio would do this to avoid
losses, it could have the effect of reducing the benefit from any upswing in the
market.
-----------------------------------
[SIDE BAR]
OTHER POTENTIAL RISKS
The portfolio may invest some assets in derivative securities, such as options
and futures, and in foreign currencies. These practices are used primarily to
hedge the portfolio but may be used to increase returns; however, such practices
sometimes may reduce returns or increase volatility. Derivatives can be
illiquid, and a small investment in certain derivatives could have a potentially
large impact on the portfolio's performance. At times, the portfolio may engage
in short-term trading, which could produce higher brokerage costs and taxable
distributions.
<PAGE>
-----------------------------------
PAST PERFORMANCE
Since the portfolio has less than one calendar year of performance, average
annual total return information for the portfolio is not included in this
section of the prospectus.
[SIDE BAR]
WHO ARE THE SHAREHOLDERS
The participating insurance companies and their separate accounts and the
Eligible Plans are the shareholders of the portfolio. From time to time, a
shareholder may own a substantial number of portfolio shares the sale of which
would adversely affect the portfolio's NAV.
WHAT THE PORTFOLIO IS AND ISN'T
The portfolio is a mutual fund: a pooled investment that is professionally
managed and gives you the opportunity to participate in financial markets. It
strives to reach its stated goal, although as with all mutual funds, it cannot
offer guaranteed results.
An investment in the portfolio is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. Shareholders could lose money in the portfolio, but
shareholders also have the potential to make money.
----------------------------------
<PAGE>
[ICON] EXPENSES
As an investor, you pay certain fees and expenses in connection with the
portfolio, which are described in the table below. Annual portfolio operating
expenses are paid out of portfolio assets, so their effect is included in the
portfolio's share price. The information in the table does not reflect account
fees and charges to separate accounts or related VA contracts and VLI policies
that may be imposed by participating insurance companies or any charges imposed
by Eligible Plans.
ANNUAL PORTFOLIO OPERATING EXPENSES
AS A % OF AVERAGE DAILY NET ASSETS
Management fees 1.00%
Other expenses ____%
- -------------------------------------------------------------------------------
TOTAL ____%
EXPENSE EXAMPLE
1 year.......................... $____
3 years......................... $____
This example shows what an investor could pay in expenses over time. It uses the
same hypothetical conditions other funds use in their prospectuses: $10,000
initial investment, 5% total return each year and no changes in expenses. The
figures shown would be the same whether investors sold their shares at the end
of a period or kept them. Because actual returns and expenses will be different,
the example is for comparison only.
[LEFT SIDE BAR]
CONCEPTS TO UNDERSTAND
MANAGEMENT FEE: the fee paid to the investment adviser for managing the
portfolio and assisting in all aspects of the portfolio's operations.
OTHER EXPENSES: estimated fees to be paid by the portfolio for the current
fiscal year for miscellaneous items such as transfer agency, custody,
professional and registration fees.
<PAGE>
[ICON] MANAGEMENT
The investment adviser for the fund is The Dreyfus Corporation, 200 Park Avenue,
New York, New York 10166. Founded in 1947, Dreyfus manages one of the nation's
leading mutual fund complexes, with more than $121 billion in over 160 mutual
fund portfolios. Dreyfus is the primary mutual fund business of Mellon Bank
Corporation, a broad-based financial services company with a bank at its core.
With more than $350 billion of assets under management and $1.7 trillion of
assets under administration and custody, Mellon provides a full range of
banking, investment and trust products and services to individuals, businesses
and institutions. Its mutual fund companies place Mellon as the leading bank
manager of mutual funds. Mellon is headquartered in Pittsburgh, Pennsylvania.
Dreyfus has engaged its affiliate, Founders Asset Management LLC, to serve as
each portfolio's sub-investment adviser. Founders, located at Founders Financial
Center, 2930 East Third Avenue, Denver, Colorado 80206, and its predecessor
companies have been offering tools to help investors pursue their financial
goals since 1938. As of December 31, 1998, Founders managed mutual funds and
other client accounts having aggregate assets of approximately $ billion.
MANAGEMENT PHILOSOPHY
The Dreyfus asset management philosophy is based on the belief that discipline
and consistency are important to investment success. For each portfolio, Dreyfus
seeks to establish clear guidelines for portfolio management and to be
systematic in making decisions. This approach is designed to provide each
portfolio with a distinct, stable identity.
PORTFOLIO MANAGERS
The primary portfolio managers of the portfolios are as follows:
FOUNDERS GROWTH PORTFOLIO C Scott A. Chapman and Thomas M. Arrington. Mr.
Chapman and Mr. Arrington have been the portfolio's primary portfolio managers
and employed by Founders, since December 1998. Prior to joining Founders, Mr.
Chapman was employed for seven years at HighMark Capital Management, Inc., a
subsidiary of Union BanCal Corporation, as a securities research analyst, and
most recently, as a vice president and director of growth strategy. Prior to
joining Founders, Mr. Arrington was employed for eight years at HighMark Capital
where he held various positions, including vice president and director of income
and growth strategy, securities research analyst, and most recently, vice
president and director of income equity strategy.
FOUNDERS INTERNATIONAL EQUITY PORTFOLIO C Douglas A. Loeffler. He has been the
portfolio's primary portfolio manager since the portfolio's inception and has
been employed by Founders since 1995. Prior to joining Founders, Mr. Loeffler
was employed for seven years at Scudder, Stevens & Clark as an international
equities and quantitative analyst.
FOUNDERS PASSPORT PORTFOLIO C Michael W. Gerding. He has been the portfolio's
primary portfolio manager since the portfolio's inception and has been employed
by Founders since 1990.
<PAGE>
PERFORMANCE INFORMATION FOR PUBLIC FUNDS
Although the portfolios are newly-organized and do not yet have their own full
year of performance, each portfolio has the same investment objective and
follows substantially the same investment policies and strategies as a
corresponding series of another open-end investment company advised by Founders
(the "Public Funds"). Set forth below is average annual total return information
for the Public Funds which correspond to the portfolios offered in this
prospectus and for an appropriate securities index. Also set forth below is the
aggregate total return for each portfolio from its commencement of operations
through December 31, 1998. Each portfolio currently has the same primary
portfolio manager as its corresponding Public Fund. Investors should not
consider this performance data as an indication of the future performance of the
portfolios offered in this prospectus. The performance figures below reflect the
deduction of the historical fees and expenses paid by the existing Public Funds,
and not those to be paid by the respective portfolio. The figures also do not
reflect the deduction of charges or expenses attributable to VA contracts or VLI
policies or Eligible Plans, which would lower the performance quoted. Policy
owners should refer to the applicable insurance company disclosure documents and
Eligible Plan participants should contact their Plan administrator or trustee
for information on any such charges and expenses. Additionally, although it is
anticipated that each portfolio and its corresponding Public Fund will hold
similar securities, their investment results are expected to differ. In
particular, differences in asset size and in cash flow resulting from purchases
and redemptions of portfolio shares may result in different security selections,
differences in the relative weightings of securities or differences in the price
paid for particular portfolio holdings.
Historical performance information for the corresponding Public Funds and for
the securities indexes for various periods ended December 31, 1998 is as
follows:
<TABLE>
<CAPTION>
Name of Public Fund Average Annual Total Return
and Index Period Ended December 31, 1998
-------------------------------------------------------------------------
One Three Five Ten Since
Year Years Years Years Inception
<S> <C> <C> <C> <C> <C>
Founders Growth Fund................ ______% ______% ______% ______% ______%
S&P 500 Index(1).................... ______% ______% ______% ______% ______%
Founders International Equity Fund.. ______% ______% N/A N/A ______%*
MSCI World (ex US) Index(2)......... ______% ______% N/A N/A ______%*
Founders Passport Fund.............. ______% ______% ______% N/A ______%**
MSCI World (ex US) Index(2)......... ______% ______% ______% N/A ______%**
-------------
1 The S&P 500 Index is an unmanaged, market value weighted index composed of
500 common stocks from a wide range of industries that are traded on the
NYSE, the AMEX and the Nasdaq market. The performance data for the S&P 500
assumes the reinvestment of all dividends, but does not deduct any fees or
expenses which are charged the Public Funds and the portfolios.
2 The MSCI World (ex US) Index is an arithmetical average of the performance
of over 1,000 securities listed on the stock exchanges of Europe, Canada,
Australia, New Zealand and the Far East. Total return figures for the Index
assume change in share price and reinvestment of dividends after deduction
of local taxes, but does not deduct any fees or expenses which are charged
the Public Funds and the portfolios.
* The performance data for the Public Fund is from December 29, 1995
(inception of the Public Fund) through December 31, 1998; the performance
data for the corresponding Index is from December 31, 1995 through December
31, 1998.
** The performance data for the Public Fund is from November 16, 1993
(inception of the Public Fund) through December 31, 1998; the performance
data for the corresponding Index is from November 30, 1993 through December
31, 1998.
</TABLE>
Aggregate total return for each portfolio and securities index for the period
ended December 31, 1998 is as follows:
AGGREGATE TOTAL RETURN PERIOD
NAME OF PORTFOLIO AND INDEX ENDED DECEMBER 31, 1998
Growth Portfolio ______%*
S&P 500 Index ______%*
International Equity Portfolio ______%**
MSCI World (ex US) Index ______%**
Passport Portfolio ______%***
MSCI World (ex US) Index ______%***
------------------------
* The performance data for the portfolio is from ______________, 1998
(commencement of operations) through December 31, 1998; the performance
data for the corresponding Index is from ____________, 1998 through
December 31, 1998.
** The performance data for the portfolio is from ______________, 1998
(commencement of operations) through December 31, 1998; the performance
data for the corresponding Index is from ____________, 1998 through
December 31, 1998.
*** The performance data for the portfolio is from ______________, 1998
(commencement of operations) through December 31, 1998; the performance
data for the corresponding Index is from ____________, 1998 through
December 31, 1998.
[SIDE BAR]
CONCEPTS TO UNDERSTAND
YEAR 2000 ISSUES: the portfolios could be adversely affected if the computer
systems used by Dreyfus and the portfolios' other service providers do not
properly process and calculate date-related information from and after January
1, 2000.
Dreyfus is working to avoid year 2000-related problems in its systems and to
obtain assurances from other service providers that they are taking similar
steps. In addition, issuers of securities in which the portfolios invest may be
adversely affected by year 2000-related problems. This could have an impact on
the value of a portfolio's investments and its share price.
<PAGE>
----------------------------------
[ICON] FINANCIAL HIGHLIGHTS
The following tables describe each portfolio's performance for the fiscal
periods indicated. "Total return" shows how much your investment in the
portfolio would have increased (or decreased) during each period, assuming you
had reinvested all dividends and distributions. These figures have been
independently audited by ______________, whose report, along with the
portfolios' financial statements, is included in the annual report. The total
investment return information set forth below does not reflect certain expenses
charged the separate accounts or related VA contracts and VLI policies by the
participating insurance companies or any charges imposed by Eligible Plans, the
inclusion of which would reduce the portfolios' total investment return for each
period indicated.
[To be provided by amendment]
----------------------------------
<PAGE>
[ICON] ACCOUNT POLICIES
BUYING SHARES
Portfolio shares are offered only to separate accounts of participating
insurance companies and Eligible Plans. Individuals may not purchase shares
directly from the portfolios. VA contract holders and VLI policy holders should
consult the applicable prospectus of the separate account of the participating
insurance company and Eligible Plan participants should consult the Plan's
administrator or trustee for more information about buying portfolio shares.
The price for portfolio shares is the portfolio's NAV, which is generally
calculated as of the close of trading on the New York Stock Exchange (usually
4:00 p.m. Eastern time) every day the exchange is open. Purchase orders from
separate accounts received in proper form by the participating insurance company
or from Eligible Plans on a given business day are priced at the NAV calculated
on such day, provided that the order and Federal Funds (monies of member banks
within the Federal Reserve System which are held on deposit at a Federal Reserve
Bank) in the net amount of such order are received by the portfolio in proper
form on the next business day. The participating insurance company or Eligible
Plan administrator or trustee is responsible for properly transmitting purchase
orders and Federal Funds.
Wire payments may be made if the bank account of the participating insurance
company or Eligible Plan is in a commercial bank that is a member of the Federal
Reserve System or any other bank having a correspondent bank in New York City.
Immediately available funds may be transmitted by wire to The Bank of New York
(DDA#8900375108/DREYFUS INVESTMENT PORTFOLIOS: NAME OF PORTFOLIO), for purchase
of portfolio shares. The wire must include the portfolio account number (for new
accounts, a taxpayer identification number should be included instead), account
registration and dealer number if applicable of the participating insurance
company or Eligible Plan.
Each portfolio's investments are generally valued based on market value, or
where market quotations are not readily available, based on fair value as
determined in good faith by the fund's board.
SELLING SHARES
Portfolio shares may be sold (redeemed) at any time by the separate accounts of
the participating insurance companies or by Eligible Plans. Individuals may not
place sell orders directly with the portfolios. Redemption orders from separate
accounts received in proper form by the participating insurance company or from
Eligible Plans on a given business day are priced at the NAV calculated on such
day, provided that the orders are received by the portfolio in proper form on
the next business day. The participating insurance company or Eligible Plan
administrator or trustee is responsible for properly transmitting redemption
orders. VA contract holders and VLI policy holders should consult the applicable
prospectus of the separate account of the participating insurance company and
Eligible Plan participants should consult the Plan's administrator or trustee
for more information about selling portfolio shares.
<PAGE>
[ICON] DISTRIBUTIONS AND TAXES
Each portfolio generally pays dividends from net investment income and
distributes any net capital gains it has realized once a year.
Distributions will be reinvested in additional shares of the relevant portfolio
unless instructed otherwise by a participating insurance company or Eligible
Plan.
Since each portfolio's shareholders are the participating insurance companies
and their separate accounts and Eligible Plans, the tax treatment of dividends
and distributions will depend on the tax status of the participating insurance
company or Eligible Plan. Accordingly, no discussion is included as to the
federal income tax consequences to VA contract holders, VLI policy holders and
Eligible Plan participants. For this information, VA contract holders and VLI
policy holders should consult the applicable prospectus of the separate account
of the participating insurance company and Eligible Plan participants should
consult the Plan's administrator or trustee.
Participating insurance companies and Eligible Plans should consult their tax
advisers about federal, state and local tax consequences.
<PAGE>
FOR MORE INFORMATION
DREYFUS INVESTMENT PORTFOLIOS
o Founders Growth Portfolio
o Founders International Equity Portfolio
o Founders Passport Portfolio
- ------------------------------------------------
SEC file number: 811-08673
More information on this fund and its portfolios is available free upon
request, including the following:
ANNUAL/SEMIANNUAL REPORT
Describes each portfolio's performance, lists portfolio holdings and
contains a letter from the portfolio manager discussing recent market
conditions, economic trends and portfolio strategies that significantly affected
the portfolio's performance during the last fiscal year.
STATEMENT OF ADDITIONAL INFORMATION (SAI)
Provides more details about the portfolios and their policies. A current
SAI is on file with the Securities and Exchange Commission (SEC) and is
incorporated by reference (is legally considered part of this prospectus).
[SIDE BAR]
TO OBTAIN INFORMATION:
BY TELEPHONE
Call 1-800-___-____
BY MAIL Write to:
The Dreyfus Family of Funds
Attn: Institutional Servicing
144 Glenn Curtiss Boulevard
Uniondale, NY 11556-0144
BY E-MAIL Send your request to [email protected]
ON THE INTERNET Text-only versions of fund documents can be viewed
online or downloaded from:
SEC
http://www.sec.gov
DREYFUS
http://www.dreyfus.com
You can also obtain copies by visiting the SEC's Public Reference Room
in Washington, DC (phone 1-800-SEC-0330) or by sending your request and
a duplicating fee to the SEC's Public Reference Section, Washington, DC
20549-6009.
(C) 1999, Dreyfus Service Corporation
<PAGE>
<PAGE>
DREYFUS INVESTMENT PORTFOLIOS
CORE VALUE PORTFOLIO
MIDCAP STOCK PORTFOLIO
FOUNDERS GROWTH PORTFOLIO
FOUNDERS INTERNATIONAL EQUITY PORTFOLIO
FOUNDERS PASSPORT PORTFOLIO
STATEMENT OF ADDITIONAL INFORMATION
MAY 1, 1999
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus of the
Core Value and MidCap Stock Portfolios, dated May 1, 1999, and the Founders
Growth, Founders International Equity and Founders Passport Portfolios, dated
May 1, 1999 (collectively, the "Portfolios"), each a separate series of Dreyfus
Investment Portfolios (the "Fund"), as each Prospectus may be revised from time
to time. To obtain a copy of the relevant Portfolio's Prospectus, please write
to the Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144, or
call (516) 338-3300.
Shares of the Portfolios are offered only to variable annuity and variable
life insurance separate accounts established by insurance companies
("Participating Insurance Companies") to fund variable annuity contracts and
variable life insurance policies (collectively, "Policies") and qualified
pension and retirement plans and accounts permitting accumulation of assets on a
tax-deferred basis (collectively, "Eligible Plans") outside the separate account
context.
The most recent Annual Report and Semi-Annual Report to Shareholders for
each Portfolio are separate documents supplied with this Statement of Additional
Information, and the financial statements, accompanying notes and report of
independent auditors appearing in the Annual Report are incorporated by
reference into this Statement of Additional Information.
TABLE OF CONTENTS
PAGE
Description of the Fund and Portfolios......................................B-2
Management of the Fund.....................................................B-15
Management Arrangements....................................................B-18
How to Buy Shares..........................................................B-23
How to Redeem Shares.......................................................B-23
Determination of Net Asset Value...........................................B-24
Dividends, Distributions and Taxes.........................................B-25
Portfolio Transactions.....................................................B-27
Performance Information....................................................B-28
Information About the Fund and Portfolios..................................B-30
Counsel and Independent Auditors...........................................B-31
Appendix...................................................................B-32
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DESCRIPTION OF THE FUND AND PORTFOLIOS
The Fund is a Massachusetts business trust that commenced operations on May
1, 1998. Each Portfolio is a separate series of the Fund, an open-end management
investment company, known as a mutual fund. Each Portfolio is a diversified
fund, which means that, with respect to 75% of the Portfolio's total assets, the
Portfolio will not invest more than 5% of its assets in the securities of any
single issuer.
The Dreyfus Corporation (the "Manager") serves as each Portfolio's
investment adviser. The Manager has engaged Founders Asset Management LLC
("Founders") to serve as sub-investment adviser to each of the Founders Growth,
Founders International Equity and Founders Passport Portfolios (collectively,
the "Founders Portfolios") and to provide day-to-day management of the Founders
Portfolios' investments, subject to the supervision of the Manager.
Premier Mutual Fund Services, Inc. (the "Distributor") is the distributor
of the Portfolios' shares.
CERTAIN PORTFOLIO SECURITIES
The following information supplements and should be read in conjunction
with the relevant Portfolio's Prospectus.
DEPOSITARY RECEIPTS. (All Portfolios) Each Portfolio may invest in the
securities of foreign issuers in the form of American Depositary Receipts and
American Depositary Shares (collectively, "ADRs") and Global Depositary Receipts
and Global Depositary Shares (collectively, "GDRs") and other forms of
depositary receipts. These securities may not necessarily be denominated in the
same currency as the securities into which they may be converted. ADRs are
receipts typically issued by a United States bank or trust company which
evidence ownership of underlying securities issued by a foreign corporation.
GDRs are receipts issued outside the United States typically by non-United
States banks and trust companies that evidence ownership of either foreign or
domestic securities. Generally, ADRs in registered form are designed for use in
the United States securities markets and GDRs in bearer form are designed for
use outside the United States.
These securities may be purchased through "sponsored" or "unsponsored"
facilities. A sponsored facility is established jointly by the issuer of the
underlying security and a depositary, whereas a depositary may establish an
unsponsored facility without participation by the issuer of the deposited
security. Holders of unsponsored depositary receipts generally bear all the
costs of such facilities and the depositary of an unsponsored facility
frequently is under no obligation to distribute shareholder communications
received from the issuer of the deposited security or to pass through voting
rights to the holders of such receipts in respect of the deposited securities.
FOREIGN GOVERNMENT OBLIGATIONS; SECURITIES OF SUPRANATIONAL ENTITIES.
(Founders Portfolios only) Each Founders Portfolio may invest in obligations
issued or guaranteed by one or more foreign governments or any of their
political subdivisions, agencies or instrumentalities that are determined by
Founders to be of comparable quality to the other obligations in which the
Portfolio may invest. Such securities also include debt obligations of
supranational entities. Supranational entities include international
organizations designated or supported by governmental entities to promote
economic reconstruction or development and international banking institutions
and related government agencies. Examples include the International Bank for
Reconstruction and Development (the World Bank), the European Coal and Steel
Community, the Asian Development Bank and the InterAmerican Development Bank.
INVESTMENT COMPANIES. (All Portfolios) Each Portfolio may invest in
securities issued by investment companies. Under the Investment Company Act of
1940, as amended (the "1940 Act"), the Portfolio's investment in such
securities, subject to certain exceptions, currently is limited to (i) 3% of the
total voting stock of any one investment company, (ii) 5% of the Portfolio's
total assets with respect to any one investment company and (iii) 10% of the
Portfolio's total assets in the aggregate. Investments in the securities of
other investment companies may involve duplication of advisory fees and certain
other expenses.
MONEY MARKET INSTRUMENTS. (All Portfolios) When the Manager (or Founders
with respect to the Founders Portfolios) determines that adverse market
conditions exist, the Portfolio may adopt a temporary defensive position and
invest some or all of its assets in money market instruments, including U.S.
Government securities, repurchase agreements, bank obligations and commercial
paper. Each Portfolio also may purchase Money Market Instruments when it has
cash reserves or in anticipation of taking a market position.
CONVERTIBLE SECURITIES. (All Portfolios) Convertible securities may be
converted at either a stated price or stated rate into underlying shares of
common stock. Convertible securities have characteristics similar to both
fixed-income and equity securities. Convertible securities generally are
subordinated to other similar but non-convertible securities of the same issuer,
although convertible bonds, as corporate debt obligations, enjoy seniority in
right of payment to all equity securities, and convertible preferred stock is
senior to common stock, of the same issuer. Because of the subordination
feature, however, convertible securities typically have lower ratings than
similar non-convertible securities.
Although to a lesser extent than with fixed-income securities generally,
the market value of convertible securities tends to decline as interest rates
increase and, conversely, tends to increase as interest rates decline. In
addition, because of the conversion feature, the market value of convertible
securities tends to vary with fluctuations in the market value of the underlying
common stock. A unique feature of convertible securities is that as the market
price of the underlying common stock declines, convertible securities tend to
trade increasingly on a yield basis, and so may not experience market value
declines to the same extent as the underlying common stock. When the market
price of the underlying common stock increases, the prices of the convertible
securities tend to rise as a reflection of the value of the underlying common
stock. While no securities investments are without risk, investments in
convertible securities generally entail less risk than investments in common
stock of the same issuer.
Convertible securities are investments that provide for a stable stream of
income with generally higher yields than common stocks. There can be no
assurance of current income because the issuers of the convertible securities
may default on their obligations. A convertible security, in addition to
providing fixed income, offers the potential for capital appreciation through
the conversion feature, which enables the holder to benefit from increases in
the market price of the underlying common stock. There can be no assurance of
capital appreciation, however, because securities prices fluctuate. Convertible
securities, however, generally offer lower interest or dividend yields than
non-convertible securities of similar quality because of the potential for
capital appreciation.
WARRANTS. (All Portfolios) A warrant is an instrument issued by a
corporation which gives the holder the right to subscribe to a specified amount
of the corporation's capital stock at a set price for a specified period of
time. Each Portfolio may invest up to 5% of its net assets in warrants, except
that this limitation does not apply to warrants purchased by the Portfolio that
are sold in units with, or attached to, other securities.
ILLIQUID SECURITIES. (All Portfolios) Each Portfolio may invest up to 15%
of the value of its net assets in securities as to which a liquid trading market
does not exist, provided such investments are consistent with the Portfolio's
investment objective. These securities may include securities that are not
readily marketable, such as certain securities that are subject to legal or
contractual restrictions on resale, repurchase agreements providing for
settlement in more than seven days after notice, and certain privately
negotiated, non-exchange traded options and securities used to cover such
options. As to these securities, the Portfolio is subject to a risk that should
the Portfolio desire to sell them when a ready buyer is not available at a price
the Portfolio deems representative of their value, the value of the Portfolio's
net assets could be adversely affected.
INVESTMENT TECHNIQUES
The following information supplements and should be read in conjunction
with the relevant Portfolio's Prospectus.
FOREIGN CURRENCY TRANSACTIONS. (Core Value and Founders Portfolios only)
Each of these Portfolios may enter into foreign currency transactions for a
variety of purposes, including: to fix in U.S. dollars, between trade and
settlement date, the value of a security the Portfolio has agreed to buy or
sell; to hedge the U.S. dollar value of securities the Portfolio already owns,
particularly if it expects a decrease in the value of the currency in which the
foreign security is denominated; or to gain exposure to the foreign currency in
an attempt to realize gains.
Foreign currency transactions may involve, for example, the Portfolio's
purchase of foreign currencies for U.S. dollars or the maintenance of short
positions in foreign currencies, which would involve the Portfolio agreeing to
exchange an amount of a currency it did not currently own for another currency
at a future date in anticipation of a decline in the value of the currency sold
relative to the currency the Portfolio contracted to receive in the exchange.
The Portfolio's success in these transactions will depend principally on the
ability of the Manager (or Founders with respect to the Founders Portfolios) to
predict accurately the future exchange rates between foreign currencies and the
U.S. dollar.
Currency exchange rates may fluctuate significantly over short periods of
time. They generally are determined by the forces of supply and demand in the
foreign exchange markets and the relative merits of investments in different
countries, actual or perceived changes in interest rates and other complex
factors, as seen from an international perspective. Currency exchange rates also
can be affected unpredictably by intervention by U.S. or foreign governments or
central banks, or the failure to intervene, or by currency controls or political
developments in the United States or abroad.
BORROWING MONEY. (All Portfolios) Each Portfolio is permitted to borrow to
the extent permitted under the 1940 Act, which permits an investment company to
borrow in an amount up to 33-1/3% of the value of its total assets. Each
Founders Portfolio currently intends to borrow money only for temporary or
emergency (not leveraging) purposes. While borrowings exceed 5% of the
Portfolio's total assets, the Portfolio will not make any additional
investments. The Core Value and MidCap Stock Portfolios may borrow money for
investment purposes as described below.
LEVERAGE. (Core Value and MidCap Stock Portfolios only) Leveraging (that
is, buying securities using borrowed money) exaggerates the effect on net asset
value of any increase or decrease in the market value of a Portfolio's
investments. These borrowings will be subject to interest costs which may or may
not be recovered by appreciation of the securities purchased; in certain cases,
interest costs may exceed the return received on the securities purchased. For
borrowings for investment purposes, the 1940 Act requires the Portfolio to
maintain continuous asset coverage (that is, total assets including borrowings,
less liabilities exclusive of borrowings) of 300% of the amount borrowed. If the
required coverage should decline as a result of market fluctuations or other
reasons, the Portfolio may be required to sell some of its portfolio securities
within three days to reduce the amount of its borrowings and restore the 300%
asset coverage, even though it may be disadvantageous from an investment
standpoint to sell securities at that time. The Portfolio also may be required
to maintain minimum average balances in connection with such borrowing or pay a
commitment or other fee to maintain a line of credit; either of these
requirements would increase the cost of borrowing over the stated interest rate.
Each of these Portfolios may enter into reverse repurchase agreements with
banks, brokers or dealers. This form of borrowing involves the transfer by the
Portfolio of an underlying debt instrument in return for cash proceeds based on
a percentage of the value of the security. The Portfolio retains the right to
receive interest and principal payments on the security. At an agreed upon
future date, the Portfolio repurchases the security at principal plus accrued
interest. To the extent a Portfolio enters into a reverse repurchase agreement,
the Portfolio will maintain in a segregated account permissible liquid assets at
least equal to the aggregate amount of its reverse repurchase obligations, plus
accrued interest, in certain cases, in accordance with releases promulgated by
the Securities and Exchange Commission. The Securities and Exchange Commission
views reverse repurchase transactions as collateralized borrowings by a
Portfolio. Except for these transactions, borrowings by the Core Value and
MidCap Stock Portfolios generally will be unsecured.
LENDING PORTFOLIO SECURITIES. (All Portfolios) Each Portfolio may lend
securities from its portfolio to brokers, dealers and other financial
institutions needing to borrow securities to complete certain transactions. The
Portfolio continues to be entitled to payments in amounts equal to the interest,
dividends or other distributions payable on the loaned securities, which affords
the Portfolio an opportunity to earn interest on the amount of the loan and on
the loaned securities' collateral. Loans of portfolio securities may not exceed
33-1/3% of the value of the Portfolio's total assets, and the Portfolio will
receive collateral consisting of cash, U.S. Government securities or irrevocable
letters of credit which will be maintained at all times in an amount equal to at
least 100% of the current market value of the loaned securities. Such loans are
terminable by the Portfolio at any time upon specified notice. The Portfolio
might experience risk of loss if the institution with which it has engaged in a
portfolio loan transaction breaches its agreement with the Portfolio. In
connection with its securities lending transactions, a Portfolio may return to
the borrower or a third party which is unaffiliated with the Portfolio, and
which is acting as a "placing broker," a part of the interest earned from the
investment of collateral received for securities loaned.
DERIVATIVES. (All Portfolios) Each Portfolio may invest in, or enter into,
derivatives, such as options and futures, for a variety of reasons, including to
hedge certain market risks, to provide a substitute for purchasing or selling
particular securities or to increase potential income gain. Derivatives may
provide a cheaper, quicker or more specifically focused way for the Portfolio to
invest than "traditional" securities would.
Derivatives can be volatile and involve various types and degrees of risk,
depending upon the characteristics of the particular derivative and the
portfolio as a whole. Derivatives permit a Portfolio to increase or decrease the
level of risk, or change the character of the risk, to which its portfolio is
exposed in much the same way as the Portfolio can increase or decrease the level
of risk, or change the character of the risk, of its portfolio by making
investments in specific securities.
Derivatives may entail investment exposures that are greater than their
cost would suggest, meaning that a small investment in derivatives could have a
large potential impact on a Portfolio's performance.
If a Portfolio invests in derivatives at inopportune times or judges market
conditions incorrectly, such investments may lower the Portfolio's return or
result in a loss. A Portfolio also could experience losses if its derivatives
were poorly correlated with its other investments, or if the Portfolio were
unable to liquidate its position because of an illiquid secondary market. The
market for many derivatives is, or suddenly can become, illiquid. Changes in
liquidity may result in significant, rapid and unpredictable changes in the
prices for derivatives.
Although neither the Fund nor any Portfolio will be a commodity pool,
certain derivatives subject the Portfolios to the rules of the Commodity Futures
Trading Commission which limit the extent to which a Portfolio can invest in
such derivatives. A Portfolio may invest in futures contracts and options with
respect thereto for hedging purposes without limit. However, no Portfolio may
invest in such contracts and options for other purposes if the sum of the amount
of initial margin deposits and premiums paid for unexpired options with respect
to such contracts, other than for bona fide hedging purposes, exceeds 5% of the
liquidation value of the Portfolio's assets, after taking into account
unrealized profits and unrealized losses on such contracts and options;
provided, however, that in the case of an option that is in-the-money at the
time of purchase, the in-the-money amount may be excluded in calculating the 5%
limitation.
Derivatives may be purchased on established exchanges or through privately
negotiated transactions referred to as over-the-counter derivatives.
Exchange-traded derivatives generally are guaranteed by the clearing agency
which is the issuer or counterparty to such derivatives. This guarantee usually
is supported by a daily payment system (i.e., variation margin requirements)
operated by the clearing agency in order to reduce overall credit risk. As a
result, unless the clearing agency defaults, there is relatively little
counterparty credit risk associated with derivatives purchased on an exchange.
By contrast, no clearing agency guarantees over-the-counter derivatives.
Therefore, each party to an over-the-counter derivative bears the risk that the
counterparty will default. Accordingly, the Manager (or Founders with respect to
the Founders Portfolios) will consider the creditworthiness of counterparties to
over-the-counter derivatives in the same manner as it would review the credit
quality of a security to be purchased by a Portfolio. Over-the-counter
derivatives are less liquid than exchange-traded derivatives since the other
party to the transaction may be the only investor with sufficient understanding
of the derivative to be interested in bidding for it.
FUTURES TRANSACTIONS--IN GENERAL. Each Portfolio may enter into futures
contracts in U.S. domestic markets, such as the Chicago Board of Trade and the
International Monetary Market of the Chicago Mercantile Exchange, or, except for
the MidCap Stock Portfolio, on exchanges located outside the United States, such
as the London International Financial Futures Exchange, the Deutsche Termine
Borse and the Sydney Futures Exchange Limited. Foreign markets may offer
advantages such as trading opportunities or arbitrage possibilities not
available in the United States. Foreign markets, however, may have greater risk
potential than domestic markets. For example, some foreign exchanges are
principal markets so that no common clearing facility exists and an investor may
look only to the broker for performance of the contract. In addition, any
profits that a Portfolio might realize in trading could be eliminated by adverse
changes in the exchange rate, or the Portfolio could incur losses as a result of
those changes. Transactions on foreign exchanges may include both commodities
which are traded on domestic exchanges and those which are not. Unlike trading
on domestic commodity exchanges, trading on foreign commodity exchanges is not
regulated by the Commodity Futures Trading Commission.
Engaging in these transactions involves risk of loss to a Portfolio which
could adversely affect the value of the Portfolio's net assets. Although each
Portfolio intends to purchase or sell futures contracts only if there is an
active market for such contracts, no assurance can be given that a liquid market
will exist for any particular contract at any particular time. Many futures
exchanges and boards of trade limit the amount of fluctuation permitted in
futures contract prices during a single trading day. Once the daily limit has
been reached in a particular contract, no trades may be made that day at a price
beyond that limit or trading may be suspended for specified periods during the
trading day. Futures contract prices could move to the limit for several
consecutive trading days with little or no trading, thereby preventing prompt
liquidation of futures positions and potentially subjecting the Portfolio to
substantial losses.
Successful use of futures by a Portfolio also is subject to the ability of
the Manager (or Founders with respect to the Founders Portfolios) to predict
correctly movements in the direction of the relevant market and, to the extent
the transaction is entered into for hedging purposes, to ascertain the
appropriate correlation between the transaction being hedged and the price
movements of the futures contract. For example, if a Portfolio uses futures to
hedge against the possibility of a decline in the market value of securities
held in its portfolio and the prices of such securities instead increase, the
Portfolio will lose part or all of the benefit of the increased value of
securities which it has hedged because it will have offsetting losses in its
futures positions. Furthermore, if in such circumstances the Portfolio has
insufficient cash, it may have to sell securities to meet daily variation margin
requirements. A Portfolio may have to sell such securities at a time when it may
be disadvantageous to do so.
Pursuant to regulations and/or published positions of the Securities and
Exchange Commission, a Portfolio may be required to set aside permissible liquid
assets in a segregated account to cover its obligations relating to its
transactions in derivatives. To maintain this required cover, the Portfolio may
have to sell portfolio securities at disadvantageous prices or times since it
may not be possible to liquidate a derivative position at a reasonable price. In
addition, the segregation of such assets will have the effect of limiting a
Portfolio's ability otherwise to invest those assets.
SPECIFIC FUTURES TRANSACTIONS. Each Portfolio may purchase and sell stock index
futures contracts. A stock index future obligates the Portfolio to pay or
receive an amount of cash equal to a fixed dollar amount specified in the
futures contract multiplied by the difference between the settlement price of
the contract on the contract's last trading day and the value of the index based
on the stock prices of the securities that comprise it at the opening of trading
in such securities on the next business day.
The Core Value Portfolio and the Founders Portfolios may purchase and sell
currency futures. A foreign currency future obligates the Portfolio to purchase
or sell an amount of a specific currency at a future date at a specific price.
Each Portfolio may purchase and sell interest rate futures contracts. An
interest rate future obligates the Portfolio to purchase or sell an amount of a
specific debt security at a future date at a specific price.
OPTIONS--IN GENERAL. Each Portfolio may invest up to 5% of its assets,
represented by the premium paid, in the purchase of call and put options. A
Portfolio may write (i.e., sell) covered call and put option contracts to the
extent of 20% of the value of its net assets at the time such option contracts
are written. A call option gives the purchaser of the option the right to buy,
and obligates the writer to sell, the underlying security or securities at the
exercise price at any time during the option period, or at a specific date.
Conversely, a put option gives the purchaser of the option the right to sell,
and obligates the writer to buy, the underlying security or securities at the
exercise price at any time during the option period, or at a specific date.
A covered call option written by a Portfolio is a call option with respect
to which the Portfolio owns the underlying security or otherwise covers the
transaction by segregating cash or other securities. A put option written by a
Portfolio is covered when, among other things, cash or liquid securities having
a value equal to or greater than the exercise price of the option are placed in
a segregated account to fulfill the obligation undertaken. The principal reason
for writing covered call and put options is to realize, through the receipt of
premiums, a greater return than would be realized on the underlying securities
alone. A Portfolio receives a premium from writing covered call or put options
which it retains whether or not the option is exercised.
There is no assurance that sufficient trading interest to create a liquid
secondary market on a securities exchange will exist for any particular option
or at any particular time, and for some options no such secondary market may
exist. A liquid secondary market in an option may cease to exist for a variety
of reasons. In the past, for example, higher than anticipated trading activity
or order flow, or other unforeseen events, at times have rendered certain of the
clearing facilities inadequate and resulted in the institution of special
procedures, such as trading rotations, restrictions on certain types of orders
or trading halts or suspensions in one or more options. There can be no
assurance that similar events, or events that may otherwise interfere with the
timely execution of customers' orders, will not recur. In such event, it might
not be possible to effect closing transactions in particular options. If, as a
covered call option writer, the Portfolio is unable to effect a closing purchase
transaction in a secondary market, it will not be able to sell the underlying
security until the option expires or it delivers the underlying security upon
exercise or it otherwise covers its position.
SPECIFIC OPTIONS TRANSACTIONS. Each Portfolio may purchase and sell call and put
options in respect of specific securities (or groups or "baskets" of specific
securities) or stock indices listed on national securities exchanges or traded
in the over-the-counter market. An option on a stock index is similar to an
option in respect of specific securities, except that settlement does not occur
by delivery of the securities comprising the index. Instead, the option holder
receives an amount of cash if the closing level of the stock index upon which
the option is based is greater than, in the case of a call, or less than, in the
case of a put, the exercise price of the option. Thus, the effectiveness of
purchasing or writing stock index options will depend upon price movements in
the level of the index rather than the price of a particular stock.
The Core Value Portfolio and Founders Portfolios may purchase and sell call
and put options on foreign currency. These options convey the right to buy or
sell the underlying currency at a price which is expected to be lower or higher
than the spot price of the currency at the time the option is exercised or
expires.
Each Portfolio may purchase cash-settled options on equity index swaps in
pursuit of its investment objective. Equity index swaps involve the exchange by
the Portfolio with another party of cash flows based upon the performance of an
index or a portion of an index of securities which usually includes dividends. A
cash-settled option on a swap gives the purchaser the right, but not the
obligation, in return for the premium paid, to receive an amount of cash equal
to the value of the underlying swap as of the exercise date. These options
typically are purchased in privately negotiated transactions from financial
institutions, including securities brokerage firms.
Successful use by a Portfolio of options will be subject to the ability of
the Manager (or Founders with respect to the Founders Portfolios) to predict
correctly movements in the prices of individual stocks, the stock market
generally, foreign currencies or interest rates. To the extent such predictions
are incorrect, a Portfolio may incur losses.
FUTURE DEVELOPMENTS. (All Portfolios) A Portfolio may take advantage of
opportunities in the area of options and futures contracts and options on
futures contracts and any other derivatives which are not presently contemplated
for use by the Portfolio or which are not currently available but which may be
developed, to the extent such opportunities are both consistent with the
Portfolio's investment objective and legally permissible for the Portfolio.
Before entering into such transactions or making any such investment on behalf
of a Portfolio, the Fund will provide appropriate disclosure in its Prospectus
or Statement of Additional Information.
FORWARD COMMITMENTS. (All Portfolios) Each Portfolio may purchase
securities on a forward commitment or when-issued basis, which means that
delivery and payment take place a number of days after the date of the
commitment to purchase. The payment obligation and the interest rate receivable
on a forward commitment or when-issued security are fixed when the Portfolio
enters into the commitment, but the Portfolio does not make a payment until it
receives delivery from the counter party. The Portfolio will commit to purchase
such securities only with the intention of actually acquiring the securities,
but the Portfolio may sell these securities before the settlement date if it is
deemed advisable. The Portfolio will set aside in a segregated account
permissible liquid assets at least equal at all times to the amount of the
Portfolio's purchase commitments.
Securities purchased on a forward commitment or when-issued basis are
subject to changes in value (generally changing in the same way, i.e.,
appreciating when interest rates decline and depreciating when interest rates
rise) based upon the public's perception of the creditworthiness of the issuer
and changes, real or anticipated, in the level of interest rates. Securities
purchased on a forward commitment or when-issued basis may expose a Portfolio to
risks because they may experience such fluctuations prior to their actual
delivery. Purchasing securities on a when-issued basis can involve the
additional risk that the yield available in the market when the delivery takes
place actually may be higher than that obtained in the transaction itself.
Purchasing securities on a forward commitment or when-issued basis when a
Portfolio is fully or almost fully invested may result in greater potential
fluctuation in the value of the Portfolio's net assets and its net asset value
per share.
INVESTMENT CONSIDERATIONS AND RISKS
FIXED INCOME SECURITIES. (All Portfolios) The Core Value Portfolio may
invest up to 5% of its total net assets in fixed-income securities, including
those of companies that are close to entering, or already in, reorganization
proceedings which are rated below investment grade by Moody's Investors Service,
Inc. ("Moody's"), Standard & Poor's Ratings Group ("S&P"), Fitch IBCA, Inc.
("Fitch") or Duff & Phelps Credit Rating Co. ("Duff" and together with S&P,
Moody's and Fitch, the "Rating Agencies"). The MidCap Stock Portfolio also may
invest in corporate obligations rated at least Baa by Moody's or BBB by S&P,
Fitch or Duff, or, if unrated, of comparable quality as determined by the
Manager. Each Founders Portfolio may invest in debt securities of domestic or
foreign issuers that management believes, based on market conditions, the
financial condition of the issuer, general economic conditions and other
relevant factors, offer opportunities for capital growth. The bonds, debentures
and corporate obligations (other than convertible securities and preferred
stock) in which each Founders Portfolio may invest must be rated not lower than
Baa by Moody's or BBB by S&P, Fitch and Duff, or, if unrated, deemed to be of
comparable quality by Founders. Even though interest-bearing securities are
investments which promise a stable stream of income, the prices of such
securities generally are inversely affected by changes in interest rates and,
therefore, are subject to the risk of market price fluctuations. Certain
securities that may be purchased by a Portfolio, such as those with interest
rates that fluctuate directly or indirectly based on multiples of a stated
index, are designed to be highly sensitive to changes in interest rates and can
subject the holders thereof to extreme reductions of yield and possibly loss of
principal.
The values of fixed-income securities also may be affected by changes in
the credit rating or financial condition of the issuer. Certain securities that
may be purchased by each Portfolio, such as those rated Baa or lower by Moody's
and BBB or lower by S&P, Fitch and Duff, may be subject to such risk with
respect to the issuing entity and to greater market fluctuations than certain
lower yielding, higher rated fixed-income securities. Once the rating of a
portfolio security has been changed, the Fund will consider all circumstances
deemed relevant in determining whether to continue to hold the security.
LOWER RATED SECURITIES. (All Portfolios, except MidCap Stock Portfolio)
Each of these Portfolios may invest a portion of its assets, in higher yielding
(and, therefore, higher risk) debt securities (convertible securities and
preferred stocks with respect to the Founders Portfolios) such as those rated Ba
by Moody's or BB by S&P, Fitch or Duff, or as low as those rated B by a Rating
Agency in the case of the Founders Portfolios, or as low as the lowest rating
assigned by a Rating Agency in the case of the Core Value Portfolio. They may be
subject to certain risks with respect to the issuing entity and to greater
market fluctuations than certain lower yielding, higher rated fixed-income
securities. The retail secondary market for these securities may be less liquid
than that of higher rated securities; adverse conditions could make it difficult
at times for the Portfolio to sell certain securities or could result in lower
prices than those used in calculating the Portfolio's net asset value.
Companies that issue certain of these securities often are highly leveraged
and may not have available to them more traditional methods of financing.
Therefore, the risk associated with acquiring the securities of such issuers
generally is greater than is the case with higher rated securities and will
fluctuate over time. For example, during an economic downturn or a sustained
period of rising interest rates, highly leveraged issuers of these securities
may experience financial stress. During such periods, such issuers may not have
sufficient revenues to meet their interest payment obligations. The issuer's
ability to service its debt obligations also may be affected adversely by
specific corporate developments, or the issuer's inability to meet specific
projected business forecasts, or the unavailability of additional financing. The
risk of loss because of default by the issuer is significantly greater for the
holders of these securities because such securities generally are unsecured and
often are subordinated to other creditors of the issuer.
Because there is no established retail secondary market for many of these
securities, the Fund anticipates that such securities could be sold only to a
limited number of dealers or institutional investors. To the extent a secondary
trading market for these securities does exist, it generally is not as liquid as
the secondary market for higher rated securities. The lack of a liquid secondary
market may have an adverse impact on market price and yield and the Portfolio's
ability to dispose of particular issues when necessary to meet such Portfolio's
liquidity needs or in response to a specific economic event such as a
deterioration in the creditworthiness of the issuer. The lack of a liquid
security market for certain securities also may make it more difficult for the
Portfolio to obtain accurate market quotations for purposes of valuing its
portfolio and calculating its net asset value. Adverse publicity and investor
perceptions, whether or not based on fundamental analysis, may decrease the
values and liquidity of these securities. In such cases, judgment may play a
greater role in valuation because less reliable, objective data may be
available.
These securities may be particularly susceptible to economic downturns. It
is likely that any economic recession could disrupt severely the market for such
securities and may have an adverse impact on the value of such securities. In
addition, it is likely that any such economic downturn could adversely affect
the ability of the issuers of such securities to repay principal and pay
interest thereon and increase the incidence of default for such securities.
The Core Value Portfolio and the Founders Portfolios may acquire these
securities during an initial offering. Such securities may involve special risks
because they are new issues. The Fund has no arrangement with any persons
concerning the acquisition of such securities, and the Manager (or Founders with
respect to the Founders Portfolios) will review carefully the credit and other
characteristics pertinent to such new issues.
The ratings of the Ratings Agencies represent their opinions as to the
quality of the obligations which they undertake to rate. Ratings are relative
and subjective and, although ratings may be useful in evaluating the safety of
interest and principal payments, they do not evaluate the market value risk of
such obligations. Although these ratings may be an initial criterion for
selection of portfolio investments, the Manager (or Founders with respect to the
Founders Portfolios) also will evaluate these securities and the ability of the
issuers of such securities to pay interest and principal.
FOREIGN SECURITIES. (All Portfolios) Foreign securities markets generally
are not as developed or efficient as those in the United States. Securities of
some foreign issuers are less liquid and more volatile than securities of
comparable U.S. issuers. Similarly, volume and liquidity in most foreign
securities markets are less than in the United States and, at times, volatility
of price can be greater than in the United States.
Because evidences of ownership of such securities usually are held outside
the United States, the Portfolio will be subject to additional risks which
include possible adverse political and economic developments, seizure or
nationalization of foreign deposits and adoption of governmental restrictions
which might adversely affect or restrict the payment of principal and interest
on the foreign securities to investors located outside the country of the
issuer, whether from currency blockage or otherwise. Moreover, foreign
securities held by the Portfolio may trade on days when the Portfolio does not
calculate its net asset value and thus affect the Portfolio's net asset value on
days when investors have no access to the Portfolio.
With respect to certain securities that may be purchased by the Founders
Portfolios only, developing countries have economic structures that are
generally less diverse and mature, and political systems that are less stable,
than those of developed countries. The markets of developing countries may be
more volatile than the markets of more mature economies; however, such markets
may provide higher rates of return to investors. Many developing countries
providing investment opportunities for the Portfolio have experienced
substantial, and in some periods extremely high, rates of inflation for many
years. Inflation and rapid fluctuations in inflation rates have had and may
continue to have adverse effects on the economies and securities markets of
certain of these countries.
Since foreign securities often are purchased with and payable in currencies
of foreign countries, the value of these assets as measured in U.S. dollars may
be affected favorably or unfavorably by changes in currency rates and exchange
control regulations.
The percentage of a Portfolio's assets which may be invested in foreign
securities as noted above is not a fundamental policy and may be changed at any
time without shareholder approval.
STATE INSURANCE REGULATION. (All Portfolios) The Fund is intended to be a
funding vehicle for VA contracts and VLI policies to be offered by Participating
Insurance Companies and will seek to be offered in as many jurisdictions as
possible. Certain states have regulations concerning concentration of
investments, purchase and sale of future contracts and short sales of
securities, among other techniques. If applied a Portfolio, the Portfolio may be
limited in its ability to engage in such techniques and to manage its portfolio
with the flexibility provided herein. It is the Fund's intention that each
Portfolio operate in material compliance with current insurance laws and
regulations, as applied, in each jurisdiction in which the Portfolio is offered.
SIMULTANEOUS INVESTMENTS. (All Portfolios) Investment decisions for each
Portfolio are made independently from those of the other Portfolios and
investment companies managed by the Manager (and, where applicable, Founders).
If, however, such other Portfolios or investment companies desire to invest in,
or dispose of, the same securities as the Portfolio, available investments or
opportunities for sales will be allocated equitably to each. In some cases, this
procedure may adversely affect the size of the position obtained for or disposed
of by a Portfolio or the price paid or received by a Portfolio.
INVESTMENT RESTRICTIONS
Each Portfolio's investment objective is a fundamental policy, which cannot
be changed without approval by the holders of a majority (as defined in the 1940
Act) of the Portfolio's outstanding voting shares. In addition, each Portfolio
has adopted investment restrictions numbered 1 through 10 as fundamental
policies. Investment restrictions numbered 11 through 15 are not fundamental
policies and may be changed, as to a Portfolio, by a vote of a majority of the
Fund's Board members at any time. No Portfolio may:
1. Invest more than 25% of the value of its total assets in the securities
of issuers in any single industry, provided that there shall be no limitation on
the purchase of obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities.
2. Invest more than 5% of its assets in the obligations of any one issuer,
except that up to 25% of the value of the Portfolio's total assets may be
invested, and securities issued or guaranteed by the U.S. Government or its
agencies or instrumentalities may be purchased, without regard to any such
limitations.
3. Purchase the securities of any issuer if such purchase would cause the
Portfolio to hold more than 10% of the voting securities of such issuer. This
restriction applies only with respect to 75% of the Portfolio's total assets.
4. Invest in commodities, except that a Portfolio may purchase and sell
options, forward contracts, futures contracts, including those relating to
indices, and options on futures contracts or indices.
5. Purchase, hold or deal in real estate, or oil, gas or other mineral
leases or exploration or development programs, but a Portfolio may purchase and
sell securities that are secured by real estate or issued by companies that
invest or deal in real estate or real estate investment trusts.
6. Borrow money, except to the extent permitted under the 1940 Act (which
currently limits borrowing to no more than 33-1/3% of the value of the
Portfolio's total assets). For purposes of this Investment Restriction, the
entry into options, forward contracts, futures contracts, including those
relating to indices, and options on futures contracts or indices shall not
constitute borrowing.
7. Make loans to others, except through the purchase of debt obligations
and the entry into repurchase agreements. However, a Portfolio may lend its
portfolio securities in an amount not to exceed 33-1/3% of the value of its
total assets. Any loans of portfolio securities will be made according to
guidelines established by the Securities and Exchange Commission and the Fund's
Board.
8. Act as an underwriter of securities of other issuers, except to the
extent a Portfolio may be deemed an underwriter under the Securities Act of
1933, as amended, by virtue of disposing of portfolio securities.
9. Issue any senior security (as such term is defined in Section 18(f) of
the 1940 Act), except to the extent the activities permitted in Investment
Restriction Nos. 4, 6, 12 and 13 may be deemed to give rise to a senior
security.
10. Purchase securities on margin, but a Portfolio may make margin deposits
in connection with transactions in options, forward contracts, futures
contracts, including those relating to indices, and options on futures contracts
or indices.
11. Invest in the securities of a company for the purpose of exercising
management or control, but the Portfolio will vote the securities it owns as a
shareholder in accordance with its views.
12. Pledge, mortgage or hypothecate its assets, except to the extent
necessary to secure permitted borrowings and to the extent related to the
purchase of securities on a when-issued or forward commitment basis and the
deposit of assets in escrow in connection with writing covered put and call
options and collateral and initial or variation margin arrangements with respect
to options, forward contracts, futures contracts, including those relating to
indices, and options on futures contracts or indices.
13. Purchase, sell or write puts, calls or combinations thereof, except as
described in the Prospectus and Statement of Additional Information.
14. Enter into repurchase agreements providing for settlement in more than
seven days after notice or purchase securities which are illiquid, if, in the
aggregate, more than 15% of the value of its net assets would be so invested.
15. Purchase securities of other investment companies, except to the extent
permitted under the 1940 Act.
* * *
If a percentage restriction is adhered to at the time of investment, a
later change in percentage resulting from a change in values or assets will not
constitute a violation of such restriction.
In addition, each Portfolio has adopted the following policies as
non-fundamental policies. Each Portfolio intends (i) to comply with the
diversification requirements prescribed in regulations under Section 817(h) of
the Internal Revenue Code of 1986, as amended (the "Code"), and (ii) to comply
in all material respects with insurance laws and regulations that the Fund has
been advised are applicable to investments of separate accounts of Participating
Insurance Companies. As non-fundamental policies, these policies may be changed
by vote of a majority of the Board members at any time.
MANAGEMENT OF THE FUND
The Fund's Board is responsible for the management and supervision of each
Portfolio. The Board approves all significant agreements with those companies
that furnish services to the Fund. These companies are as follows:
The Dreyfus Corporation................ Investment Adviser
Founders Asset Management LLC.......... Sub-Investment Adviser for the Founders
Portfolios
Premier Mutual Fund Services, Inc...... Distributor
Dreyfus Transfer, Inc.................. Transfer Agent
The Bank of New York................... Custodian for the Founders International
Equity and Founders Passport Portfolios
Mellon Bank, N.A....................... Custodian for the Core Value, Founders
Growth and MidCap Stock Portfolios
Board members and officers of the Fund, together with information as to
their principal business occupations during at least the last five years, are
shown below.
BOARD MEMBERS OF THE FUND
JOSEPH S. DiMARTINO, CHAIRMAN OF THE BOARD. Since January 1995, Chairman of
the Board of various funds in the Dreyfus Family of Funds. He also is a
director of The Muscular Dystrophy Association, The Noel Group, Inc., a
venture capital company (for which, from February 1995 until November 1997,
he was Chairman of the Board), Career Blazers, Inc. (formerly, Staffing
Resources, Inc.), a temporary placement agency, HealthPlan Services
Corporation, a provider of marketing, administrative and risk management
services to health and other benefit programs, Carlyle Industries, Inc.
(formerly, Belding Heminway Company, Inc.), a button packager and
distributor, and Century Business Services, Inc. (formerly, International
Alliance Services, Inc.), a provider of various outsourcing functions for
small and medium sized companies. For more than five years prior to January
1995, he was President, a director and, until August 1994, Chief Operating
Officer of the Manager and Executive Vice President and a director of
Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager. From
August 1994 until December 31, 1994, he was a director of Mellon Bank
Corporation. He is 55 years old and his address is 200 Park Avenue, New
York, New York 10166.
CLIFFORD L. ALEXANDER, JR., BOARD MEMBER. President of Alexander & Associates,
Inc., a management consulting firm. From 1977 to 1981, Mr. Alexander served
as Secretary of the Army and Chairman of the Board of the Panama Canal
Company, and from 1975 to 1977, he was a member of the Washington, D.C. law
firm of Verner, Liipfert, Bernhard, McPherson and Alexander. He is a
director of American Home Products Corporation, Cognizant Corporation, a
service provider of marketing information and information technology, The
Dun & Bradstreet Corporation, MCI Communications Corporation, Mutual of
America Life Insurance Company and TLC Beatrice International Holdings,
Inc. He is 64 years old and his address is 400 C Street, N.E., Washington,
D.C. 20002.
LUCY WILSON BENSON, BOARD MEMBER. President of Benson and Associates,
consultants to business and government. Mrs. Benson is a director of COMSAT
Corporation, General Re Corporation and Logistics Management Institute. She
is also a Trustee of the Alfred P. Sloan Foundation, Vice Chairman of the
Board of Trustees of Lafayette College, Vice Chairman of the Citizens
Network for Foreign Affairs, and a member of the Council on Foreign
Relations. Mrs. Benson served as a consultant to the U.S. Department of
State and to SRI International from 1980 and 1981. From 1977 to 1980, she
was Under Secretary of State for Security Assistance, Science and
Technology. She is 69 years old and her address is 46 Sunset Avenue,
Amherst, Massachusetts 01002.
The Fund typically pays its Board members an annual retainer and a per
meeting fee and reimburses them for their expenses. The Chairman of the Board
receives an additional 25% of such compensation. Emeritus Board members are
entitled to receive an annual retainer and a per meeting fee of one-half the
amount paid to them as Board members. The aggregate amount of compensation paid
to each Board member by the Fund, and by all other funds in the Dreyfus Family
of Funds for which such person is a Board member (the number of which is set
forth in parenthesis next to each Board member's total compensation) for the
year ended December 31, 1998, is as follows:
Total Compensation
From Fund and Fund
Aggregate Complex Paid
NAME OF BOARD MEMBER COMPENSATION FROM FUND* TO BOARD MEMBER
Joseph S. DiMartino $ $
Clifford L. Alexander, Jr. $ $
Lucy Wilson Benson $ $
- -------------------
* Amount does not include reimbursed expenses for attending Board meetings,
which amounted to $___________ for all board members as a group.
OFFICERS OF THE FUND
MARIE E. CONNOLLY, PRESIDENT AND TREASURER. President, Chief Executive
Officer, Chief Compliance Officer and a director of the Distributor and
Funds Distributor, Inc., the ultimate parent of which is Boston
Institutional Group, Inc., and an officer of other investment companies
advised or administered by the Manager. She is 41 years old.
MARGARET W. CHAMBERS, Vice PRESIDENT AND SECRETARY. Senior Vice President and
General Counsel of Funds Distributor, Inc., and an officer of other
investment companies advised or administered by the Manager. From August
1996 to March 1998, she was Vice President and Assistant General Counsel
for Loomis, Sayles & Company, L.P. From January 1986 to July 1996, she was
an associate with the law firm of Ropes & Gray. She is 38 years old.
MICHAEL S. PETRUCELLI, VICE PRESIDENT, ASSISTANT SECRETARY AND ASSISTANT
TREASURER. Senior Vice President of Funds Distributor, Inc., and an officer
of other investment companies advised or administered by the Manager. From
December 1989 through November 1996, he was employed by GE Investment
Services where he held various financial, business development and
compliance positions. He also served as Treasurer of the GE Funds and as a
Director of GE Investment Services. He is 36 years old.
STEPHANIE D. PIERCE, VICE PRESIDENT, ASSISTANT SECRETARY AND ASSISTANT
TREASURER. Vice President and Client Development Manager of Funds
Distributor, Inc., and an officer of other investment companies advised or
administered by the Manager. From April 1997 to March 1998, she was
employed as a Relationship Manager with Citibank, N.A. From August 1995 to
April 1997, she was an Assistant Vice President with Hudson Valley Bank,
and from September 1990 to August 1995, she was Second Vice President with
Chase Manhattan Bank. She is 30 years old.
MARY A. NELSON, VICE PRESIDENT AND ASSISTANT TREASURER. Vice President of the
Distributor and Funds Distributor, Inc., and an officer of other investment
companies advised or administered by the Manager. From September 1989 to
July 1994, she was an Assistant Vice President and Client Manager for The
Boston Company, Inc. She is 34 years old.
GEORGE A. RIO, VICE PRESIDENT AND ASSISTANT TREASURER. Executive Vice
President and Client Service Director of Funds Distributor, Inc., and an
officer of other investment companies advised or administered by the
Manager. From June 1995 to March 1998, he was Senior Vice President and
Senior Key Account Manager for Putnam Mutual Funds. From May 1994 to June
1995, he was Director of Business Development for First Data Corporation.
From September 1983 to May 1994, he was Senior Vice President and Manager
of Client Services and Director of Internal Audit at The Boston Company,
Inc. He is 43 years old.
JOSEPH F. TOWER, III, VICE PRESIDENT AND ASSISTANT TREASURER. Senior Vice
President, Treasurer, Chief Financial Officer and a director of the
Distributor and Funds Distributor, Inc., and an officer of other investment
companies advised or administered by the Manager. From July 1988 to August
1994, he was employed by The Boston Company, Inc. where he held various
management positions in the Corporate Finance and Treasury areas. He is 36
years old.
DOUGLAS C. CONROY, VICE PRESIDENT AND ASSISTANT SECRETARY. Assistant Vice
President of Funds Distributor, Inc., and an officer of other investment
companies advised or administered by the Manager. From April 1993 to
January 1995, he was a Senior Fund Accountant for Investors Bank & Trust
Company. He is 29 years old.
CHRISTOPHER J. KELLEY, VICE PRESIDENT AND ASSISTANT SECRETARY. Vice President
and Senior Associate General Counsel of Funds Distributor, Inc., and an
officer of other investment companies advised or administered by the
Manager. From April 1994 to July 1996, he was Assistant Counsel at Forum
Financial Group. He is 33 years old.
KATHLEEN K. MORRISEY, VICE PRESIDENT AND ASSISTANT SECRETARY. Manager of
Treasury Services Administration of Funds Distributor, Inc., and an officer
of other investment companies advised or administered by the Manager. From
July 1994 to November 1995, she was a Fund Accountant for Investors Bank &
Trust Company. She is 26 years old.
ELBA VASQUEZ, VICE PRESIDENT AND ASSISTANT SECRETARY. Assistant Vice
President of Funds Distributor, Inc., and an officer of other investment
companies advised or administered by the Manager. From March 1990 to May
1996, she was employed by U.S. Trust Company of New York where she held
various sales and marketing positions. She is 37 years old.
The address of each officer of the Fund is 200 Park Avenue, New York, New
York 10166.
As of _____________, 1999, none of the Fund's Board members or officers
owned shares of any Portfolio.
MANAGEMENT ARRANGEMENTS
INVESTMENT ADVISER. The Manager is a wholly-owned subsidiary of Mellon
Bank, N.A., which is a wholly-owned subsidiary of Mellon Bank Corporation
("Mellon"). Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international markets.
Mellon is among the twenty-five largest bank holding companies in the United
States based on total assets.
The Manager provides management services pursuant to the Management
Agreement (the "Agreement") with the Fund dated April 16, 1998, as amended July
16, 1998. As to each Portfolio, the Agreement is subject to annual approval by
(i) the Fund's Board or (ii) vote of a majority (as defined in the 1940 Act) of
the outstanding voting securities of such Portfolio, provided that in either
event the continuance also is approved by a majority of the Board members who
are not "interested persons" (as defined in the 1940 Act) of the Fund or the
Manager, by vote cast in person at a meeting called for the purpose of voting on
such approval. The Agreement was last approved by the Fund's Board, including a
majority of the Board members who are not "interested persons" of any party to
the Agreement, at a meeting held on July 16, 1998. As to each Portfolio, the
Agreement is terminable without penalty, on 60 days' notice, by the Fund's Board
or by vote of the holders of a majority of the shares of such Portfolio, or,
upon not less than 90 days' notice, by the Manager. The Agreement will terminate
automatically, as to the relevant Portfolio, in the event of its assignment (as
defined in the 1940 Act).
The following persons are officers and/or directors of the Manager:
Christopher M. Condron, Chairman of the Board and Chief Executive Officer;
Stephen E. Canter, President, Chief Operating Officer, Chief Investment Officer
and a director; Thomas F. Eggers, Vice Chairman-Institutional and a director;
Lawrence S. Kash, Vice Chairman and a director; J. David Officer, Vice Chairman
and a director; Ronald P. O'Hanley III, Vice Chairman; William T. Sandalls, Jr.,
Executive Vice President; Mark N. Jacobs, Vice President, General Counsel and
Secretary; Patrice M. Kozlowski, Vice President-Corporate Communications; Mary
Beth Leibig, Vice President-Human Resources; Andrew S. Wasser, Vice
President-Information Systems; Theodore A. Schachar, Vice President; Wendy
Strutt, Vice President; Richard Terres, Vice President; William H. Maresca,
Controller; James Bitetto, Assistant Secretary; Steven F. Newman, Assistant
Secretary; and Mandell L. Berman, Burton C. Borgelt, Steven G. Elliott, Martin
C. McGuinn, Richard W. Sabo and Richard F. Syron, directors.
SUB-INVESTMENT ADVISORY AGREEMENT. With respect to the Founders Portfolios,
the Manager has entered into a Sub-Investment Advisory Agreement with Founders
dated July 16, 1998 (the "Founders Sub-Advisory Agreement"). As to each Founders
Portfolio, the Founders Sub-Advisory Agreement is subject to annual approval by
(i) the Fund's Board or (ii) vote of a majority (as defined in the 1940 Act) of
the Portfolio's outstanding voting securities, provided that in either event the
continuance also is approved by a majority of the Board members who are not
"interested persons" (as defined in the 1940 Act) of the Fund or Founders, by
vote cast in person at a meeting called for the purpose of voting on such
approval. The Founders Sub-Advisory Agreement was last approved by the Fund's
Board, including a majority of the Board members who are not "interested
persons" of any party to the Founders Sub-Advisory Agreement, at a meeting held
on July 16, 1998. As to each Founders Portfolio, the Founders Sub-Advisory
Agreement is terminable without penalty, (i) by the Manager on 60 days' notice,
(ii) by the Fund's Board or by vote of the holders of a majority of the
Portfolio's outstanding voting securities on 60 days' notice, or (iii) upon not
less than 90 days' notice, by Founders. The Founders Sub-Advisory Agreement will
terminate automatically, as to the relevant Founders Portfolio, in the event of
its assignment (as defined in the 1940 Act).
The following persons are officers of Founders: Christopher M. Condron,
Chairman; Stephen E. Canter, Acting Chief Executive Officer; Gregory P.
Contillo, Senior Vice President and Chief Marketing Officer; Michael W. Gerding,
Senior Vice President; Michael K. Haines, Senior Vice President; David L. Ray,
Senior Vice President, Treasurer and Assistant Secretary; Robert T. Ammann, Vice
President; Angelo Barr, Vice President and National Sales Manager; Kenneth R.
Christoffersen, Vice President, General Counsel and Secretary; Frank Gaffney,
Vice President; Roberto Galindo, Jr., Vice President; Laurine Garrity, Vice
President; Brian F. Kelly, Vice President; Paul A. LaRocco, Vice President;
Douglas A. Loeffler, Vice President; John B. Mezger, Vice President and Director
of Private Advisory Services; and Linda M. Ripley, Vice President.
The Manager manages the investments of each Portfolio in accordance with
the stated policies of the Portfolio, subject to the approval of the Fund's
Board. With respect to each Founders Portfolio, Founders provides day-to-day
management of the Portfolio's investments, subject to the supervision of the
Manager and the Fund's Board. The Manager and Founders are responsible for
investment decisions with respect to the Core Value and MidCap Stock Portfolios
and Founders Portfolios, respectively, and provide the Fund with portfolio
managers who are authorized by the Fund's Board to execute purchases and sales
of securities for the relevant Portfolio. The portfolio managers who comprise
the committee responsible for making investment decisions for Core Value
Portfolio are Francis DeAngelis, William Goldenberg and Valerie Sill. The
primary portfolio manager of Founders Growth Portfolio is Paul A. LaRocco. The
primary portfolio manager of Founders International Equity Portfolio is Douglas
A. Loeffler. The primary portfolio manager of Founders Passport Portfolio is
Michael W. Gerding. The portfolio managers of MidCap Stock Portfolio are John
O'Toole, Ronald Gala, Steven Falci, Robert Wilke, Mark Sickorski, Harry Grosse
and Jocelyn Reed.
The Manager and Founders maintain research departments with professional
portfolio managers and securities analysts who provide research services for the
Portfolios and for other funds advised by the Manager or Founders.
All expenses incurred in the operation of the Fund are borne by the Fund,
except to the extent specifically assumed by the Manager (or, if applicable,
Founders). The expenses borne by the Fund include: organizational costs, taxes,
interest, loan commitment fees, dividends and interest on securities sold short,
brokerage fees and commissions, if any, fees of Board members who are not
officers, directors, employees or holders of 5% or more of the outstanding
voting securities of the Manager or Founders or any of their affiliates,
Securities and Exchange Commission fees, state Blue Sky qualification fees,
advisory fees, charges of custodians, transfer and dividend disbursing agents'
fees, certain insurance premiums, industry association fees, outside auditing
and legal expenses, costs of maintaining the Fund's existence, costs of
independent pricing services, costs attributable to investor services
(including, without limitation, telephone and personnel expenses), costs of
shareholders' reports and meetings, costs of preparing and printing prospectuses
and statements of additional information for regulatory purposes and for
distribution to existing shareholders, and any extraordinary expenses. Expenses
attributable to a particular Portfolio are charged against the assets of that
Portfolio; other expenses of the Fund are allocated among the Portfolios on the
basis determined by the Fund's Board, including, but not limited to,
proportionately in relation to the net assets of each Portfolio.
The Manager maintains office facilities on behalf of the Fund, and
furnishes statistical and research data, clerical help, accounting, data
processing, bookkeeping and internal auditing and certain other required
services to the Fund. The Manager, from time to time, may make payments from its
own assets to Participating Insurance Companies and Eligible Plans in connection
with the provision of certain administrative services to one or more Portfolios
and/or to purchasers of VA contracts or VLI policies or Plan Participants. The
Manager also may make such advertising and promotional expenditures, using its
own resources, as it from time to time deems appropriate.
As compensation for its services, the Fund has agreed to pay the
Manager a monthly fee at the annual rate set forth below as a percentage of the
relevant Portfolio's average daily net assets.
NAME OF PORTFOLIO MANAGEMENT FEE
Core Value Portfolio .75%
MidCap Stock Portfolio .75%
Founders Growth Portfolio .75%
Founders International Equity Portfolio 1.00%
Founders Passport Portfolio 1.00%
The fees paid by the Fund to the Manager with respect to each Portfolio for
the period from its commencement of operations through December 31, 1998 were as
follows:
NAME OF PORTFOLIO MANAGEMENT FEE PAID
Core Value Portfolio(1) $
MidCap Stock Portfolio(1) $
Founders Growth Portfolio(2) $
Founders International Equity Portfolio(2) $
Founders Passport Portfolio(2) $
- -----------------
(1) From May 1, 1998 (commencement of operations) through December 31, 1998.
(2) From _______, 1998 (commencement of operations) through December 31, 1998.
As compensation for Founders' services, the Manager has agreed to pay
Founders a monthly sub-advisory fee at the annual rate set forth below as a
percentage of the relevant Founders Portfolio's average daily net assets:
NAME OF PORTFOLIO
Sub-Investment
FOUNDERS GROWTH PORTFOLIO ADVISORY FEE
- ------------------------- ------------
0 to $100 million of average daily net assets .25%
$100 million to $1 billion of average daily net assets .20%
$1 billion to $1.5 billion of average daily net assets .16%
$1.5 billion or more of average daily net assets .10%
FOUNDERS INTERNATIONAL EQUITY PORTFOLIO AND
FOUNDERS PASSPORT PORTFOLIO
0 to $100 million of average daily net assets .35%
$100 million to $1 billion of average daily net assets .30%
$1 billion to $1.5 billion of average daily net assets .26%
$1.5 billion or more of average daily net assets .20%
The fees payable by the Manager to Founders with respect to the Founders
Growth, Founders International Equity and Founders Passport Portfolios for the
period from _________, 1998 (commencement of operations) through December 31,
1998 amounted to $________, $________ and $________, respectively.
The aggregate of the fees payable to the Manager is not subject to
reduction as the value of a Portfolio's assets increases.
DISTRIBUTOR. The Distributor, located at 60 State Street, Boston,
Massachusetts 02109, serves as the Fund's distributor on a best efforts basis
pursuant to an agreement which is renewable annually.
TRANSFER AND DIVIDEND DISBURSING AGENT AND CUSTODIAN. Dreyfus Transfer,
Inc. (the "Transfer Agent"), a wholly-owned subsidiary of the Manager, P.O. Box
9671, Providence, Rhode Island 02940-9671, is the Fund's transfer and dividend
disbursing agent. Under a transfer agency agreement with the Fund, the Transfer
Agent arranges for the maintenance of shareholder account records for the Fund,
the handling of certain communications between shareholders and the Fund and the
payment of dividends and distributions payable by the Fund. For these services,
the Transfer Agent receives a monthly fee computed on the basis of the number of
shareholder accounts it maintains for the Fund during the month, and is
reimbursed for certain out-of-pocket expenses.
Mellon Bank, N.A., the Manager's parent, One Mellon Bank Center,
Pittsburgh, Pennsylvania 15258, serves as the Fund's Custodian with respect to
the Core Value, Founders Growth, and MidCap Stock Portfolios. Under a custody
agreement with the Fund, Mellon Bank, N.A. holds each such Portfolio's
securities and keeps all necessary accounts and records. For its custody
services, Mellon Bank, N.A. receives a monthly fee based on the market value of
each such Portfolio's assets held in custody and receives certain securities
transaction charges.
The Bank of New York, 90 Washington Street, New York, New York 10286,
serves as the Fund's custodian with respect to the Founders International Equity
and Founders Passport Portfolios. The Bank of New York has no part in
determining the investment policies of the Portfolios or which securities are to
be purchased or sold by the Portfolios.
HOW TO BUY SHARES
Individuals may not place purchase orders directly with the Fund.
Individuals should consult a Participating Insurance Company, the administrator
of an Eligible Plan or a financial intermediary for information on the purchase
of Portfolio shares. Separate accounts of the Participating Insurance Companies
place orders based on, among other things, the amount of premium payments to be
invested pursuant to VA contracts and VLI policies. See the prospectus of the
separate account of the applicable Participating Insurance Company for more
information on the purchase of Fund shares.
Fund shares are sold on a continuous basis. Net asset value per share is
determined as of the close of trading on the floor of the New York Stock
Exchange (currently 4:00 p.m., New York time), on each day that the New York
Stock Exchange is open for business. For purposes of determining net asset
value, options and futures will be valued 15 minutes after the close of trading
on the floor of the New York Stock Exchange. Net asset value per share is
computed by dividing the value of the net assets of each Portfolio (i.e., the
value of its assets less liabilities) by the total number of Portfolio shares
outstanding. Each Portfolio's investments are valued based on market value, or
where market quotations are not readily available, based on fair value as
determined in good faith by the Fund's Board. For further information regarding
methods employed in valuing each Portfolio's investments, see "Determination of
Net Asset Value."
HOW TO REDEEM SHARES
GENERAL. Portfolio shares may be redeemed at any time by the separate
accounts of the Participating Insurance Companies or by Eligible Plans.
Individuals may not place redemption orders directly with the Fund. Redemption
requests received by the Participating Insurance Company or Eligible Plan on a
given business day will be effected at the net asset value of the applicable
Portfolio determined on such business day if the requests are received by the
Fund in proper form and in accordance with applicable requirements on the next
business day. It is each Participating Insurance Company's or Eligible Plan
administrator's or trustee's responsibility to properly transmit redemption
requests in accordance with applicable requirements. The value of the shares
redeemed may be more or less than their original cost, depending on the
Portfolio's then-current net asset value.
The Fund ordinarily will make payment for all shares redeemed within seven
days after receipt by the Transfer Agent or other entity authorized to accept
orders on behalf of the Fund of a redemption request in proper form, except as
provided by the rules of the Securities and Exchange Commission.
REDEMPTION COMMITMENT. The Fund has committed to pay in cash all redemption
requests by any shareholder of record, limited in amount during any 90-day
period to the lesser of $250,000 or 1% of the value of a Portfolio's net assets
at the beginning of such period. Such commitment is irrevocable without the
prior approval of the Securities and Exchange Commission and is a fundamental
policy, as to a Portfolio, which may not be changed without shareholder approval
of such Portfolio. In the case of requests for redemption in excess of such
amount, the Fund's Board reserves the right to make payments in whole or part in
securities or other assets of the Portfolio in case of an emergency or any time
a cash distribution would impair the liquidity of the Portfolio to the detriment
of the existing shareholders. In such event, the securities would be valued in
the same manner as the Portfolio's investments are valued. If the recipient sold
such securities, brokerage charges might be incurred.
SUSPENSION OF REDEMPTIONS. The right of redemption may be suspended or the
date of payment postponed (a) during any period when the New York Stock Exchange
is closed (other than customary weekend and holiday closings), (b) when trading
in the markets the Fund ordinarily utilizes is restricted, or when an emergency
exists as determined by the Securities and Exchange Commission so that disposal
of the Fund's investments or determination of its net asset value is not
reasonably practicable, or (c) for such other periods as the Securities and
Exchange Commission by order may permit to protect the Fund's shareholders.
DETERMINATION OF NET ASSET VALUE
Each Portfolio's investment securities are valued at the last sale price on
the securities exchange or national securities market on which such securities
are primarily traded. Securities not listed on an exchange or national
securities market, or securities in which there were no transactions, are valued
at the average of the most recent bid and asked prices, except in the case of
open short positions where the asked price is used for valuation purposes. Bid
price is used when no asked price is available. Market quotations for foreign
securities denominated in foreign currencies are translated into U.S. dollars at
the prevailing rates of exchange. Because of the need to obtain prices as of the
close of trading on various exchanges throughout the world, the calculation of
net asset value may not take place contemporaneously with the determination of
prices of the Core Value Portfolio's or any Founders Portfolio's foreign
investment securities. If events materially affecting the value of such
securities occur between the time when their price is determined and the time
when the Portfolio's net asset value is calculated, such securities may be
valued at fair value as determined in good faith by the Board. Short-term
investments are carried at amortized cost, which approximates value. Any
securities or other assets for which recent market quotations are not readily
available are valued at fair value as determined in good faith by the Fund's
Board. Expenses and fees, including the management fee (reduced by the expense
limitation, if any), are accrued daily and taken into account for the purpose of
determining the net asset value of shares.
Restricted securities, as well as securities or other assets for which
market quotations are not readily available, or are not valued by a pricing
service approved by the Fund's Board, are valued at fair value as determined in
good faith by the Fund's Board. The Fund's Board will review the method of
valuation on a current basis. In making their good faith valuation of restricted
securities, the Board members generally will take the following factors into
consideration: restricted securities which are, or are convertible into,
securities of the same class of securities for which a public market exists
usually will be valued at market value less the same percentage discount at
which purchased. This discount will be revised periodically by the Fund's Board
if the Board members believe that it no longer reflects the value of the
restricted securities. Restricted securities not of the same class as securities
for which a public market exists usually will be valued initially at cost. Any
subsequent adjustment from cost will be based upon considerations deemed
relevant by the Fund's Board.
NEW YORK STOCK EXCHANGE CLOSINGS. The holidays (as observed) on which the
New York Stock Exchange is closed currently are: New Year's Day, Martin Luther
King Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving and Christmas.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Management believes that each Portfolio has qualified as a regulated
investment company under the Code for the period ended December 31, 1998. Each
Portfolio intends to continue to so qualify as long as such qualification is in
the best interests of its shareholders. As a regulated investment company, each
Portfolio will pay no Federal income tax on net investment income and net
realized securities gains to the extent that such income and gains are
distributed to shareholders in accordance with applicable provisions of the
Code. To qualify as a regulated investment company, the Portfolio must meet
several requirements. These requirements include the following: (1) at least 90%
of the Portfolio's gross income must be derived from dividends, interest,
payments with respect to securities loans, gains from the sale or disposition of
stock, securities or foreign currencies or other income (including gain from
options, futures or forward contracts) derived in connection with the
Portfolio's investment business, (2) at the close of each quarter of the
Portfolio's taxable year, (a) at least 50% of the value of the Portfolio's
assets must consist of cash, United States Government securities, securities of
other regulated investment companies and other securities (limited generally
with respect to any one issuer to not more than 5% of the total assets of the
Portfolio and not more than 10% of the outstanding voting securities of such
issuer) and (b) not more than 25% of the value of the Portfolio's assets may be
invested in the securities of any one issuer (other than United States
Government securities or securities of other regulated investment companies) or
of two or more issuers which the Portfolio controls and which are determined to
be engaged in similar or related trades or businesses and (3) at least 90% of
the Portfolio's net income (consisting of net investment income and net
short-term capital gain) must be distributed to its shareholders. The Portfolios
may be subject to a non-deductible 4% excise tax, measured with respect to
certain undistributed amount of investment income and capital gains. The term
"regulated investment company" does not imply the supervision of management or
investment practices or policies by any government agency.
Investment by a Portfolio in securities issued or acquired at a discount or
providing for deferred interest or for payment of interest in the form of
additional obligations could, under special tax rules, affect the amount, timing
and character of distributions to shareholders by causing the Portfolio to
recognize income prior to the receipt of cash payments. For example, the
Portfolio could be required to accrue a portion of the discount (or deemed
discount) at which the securities were issued each year and to distribute such
income in order to maintain its qualification as a regulated investment company.
In such case, the Portfolio may have to dispose of securities which it might
otherwise have continued to hold in order to generate cash to satisfy these
distribution requirements. In addition, if a Portfolio invests in an entity that
is classified as a "passive foreign investment company" ("PFIC") for Federal
income tax purposes, the operation of certain provisions of the Code applying to
PFICs could result in the imposition of certain Federal income taxes on the
Portfolio.
Shareholders of the Portfolios will be variable annuity and variable life
insurance separate accounts established by insurance companies to fund Policies
and Eligible Plans. Section 817(h) of the Code and the regulations thereunder
set standards for diversification of the investments underlying Policies in
order for the Policies to be treated as life insurance. These requirements,
which are in addition to diversification requirements applicable to the
Portfolios under Subchapter M of the Code, may affect the composition of a
Portfolio's investments.
The Secretary of the Treasury may in the future issue additional
regulations or revenue rulings that will prescribe the circumstances in which a
Policy owner's control of the investments of a separate account may cause the
Policy owner, rather than the insurance company, to be treated as the owner of
assets of the separate account. Failure to comply with Section 817(h) of the
Code or any regulation thereunder, or with any regulations or revenue rulings on
Policy owner control, if promulgated, would cause earnings regarding a Policy
owner's interest in the separate account to be includable in the Policy owner's
gross income in the year earned.
If a Portfolio fails to qualify as a regulated investment company, the
Portfolio will be subject to federal, and possibly state, corporate taxes on its
taxable income and gains, distributions to its shareholders will be taxed as
ordinary dividend income to the extent of such Portfolio's available earnings
and profits, and Policy owners could be subject to current tax on distributions
received with respect to Portfolio shares.
The Fund will not report dividends paid to Eligible Plans to the Internal
Revenue Service ("IRS"). Generally, distributions from Eligible Plans, except
those representing returns of non-deductible contributions thereto, will be
taxable as ordinary income and, if made prior to the time the participant
reaches age 59-1/2, generally will be subject to an additional tax equal to 10%
of the taxable portion of the distribution. If the distribution from an Eligible
Plan (other than certain governmental or church plans) for any taxable year
following the year in which the participant reaches age 70-1/2 is less than the
"minimum required distribution" for that taxable year, an excise tax equal to
50% of the deficiency may be imposed by the IRS. (In some cases, minimum
required distributions need not commence until the participant retires, if
later.) The administrator, trustee or custodian of such a Plan will be
responsible for reporting distributions from the Plan to the IRS. Participants
in Eligible Plans will receive a disclosure statement describing the
consequences of a distribution from the Plan from the administrator, trustee or
custodian of the Plan prior to receiving the distribution. Moreover, certain
contributions to an Eligible Plan in excess of the amounts permitted by law may
be subject to an excise tax. For more information concerning the Federal income
tax consequences, Policy owners should refer to the prospectus for their
contracts or policies and Eligible Plan participants should consult the Plan's
administrator or trustee.
PORTFOLIO TRANSACTIONS
Purchases and sales of portfolio securities on a securities exchange are
effected by the Manager (or Founders with respect to the Founders Portfolios)
through brokers who charge a negotiated commission for their services based on
the quality and quantity of execution services provided by the broker in the
light of generally prevailing rates. In the over-the-counter market, securities
are generally traded on a "net" basis with dealers acting as principal for their
own accounts without a stated commission, although the price of the security
usually includes a profit to the dealer. In underwritten offerings, securities
are purchased at a fixed price that includes an amount of compensation to the
underwriter, generally referred to as the underwriter's concession or discount.
Transactions are allocated to various dealers by the Fund's portfolio managers
in their best judgment. The primary consideration is prompt and effective
execution of orders at the most favorable price.
Subject to that primary consideration, dealers may be selected for
research, statistical or other services to enable the Manager and Founders to
supplement their own research and analysis with the views and information of
other securities firms and may be selected based upon their sales of shares of
funds advised by the Manager or its affiliates. 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;
and effect securities transactions, and perform functions incidental thereto
(such as clearance and settlement).
Research services furnished by brokers through which the Fund effects
securities transactions may be used by the Manager and Founders in advising
other funds or accounts and, conversely, research services furnished to the
Manager and Founders by brokers in connection with other funds or accounts may
be used in advising a Portfolio. Although it is not possible to place a dollar
value on these services, it is the opinion of the Manager that the receipt and
study of such services should not reduce the overall research department
expenses.
Brokers also will be selected based on their sales of shares of other funds
advised by the Manager or its affiliates, as well as their ability to handle
special executions such as are involved in large block trades or broad
distributions, provided the primary consideration is met. Large block trades
may, in certain cases, result from two or more funds in the Dreyfus Family of
Funds being engaged simultaneously in the purchase or sale of the same security.
Certain of the Portfolios' transactions in securities of foreign issuers may not
benefit from the negotiated commission rates available for transactions in
securities of domestic issuers. Higher portfolio turnover rates are likely to
result in comparatively greater brokerage expenses. The overall reasonableness
of brokerage commissions paid is evaluated based upon knowledge of available
information as to the general level of commissions paid by other institutional
investors for comparable services.
The Fund contemplates that, consistent with the policy of obtaining the
most favorable net price, brokerage transactions may be conducted through the
Manager or Founders or their affiliates, including Dreyfus Investment Services
Corporation. The Fund's Board has adopted procedures in conformity with Rule
17e-1 under the 1940 Act to ensure that all brokerage commissions paid to the
Manager or Founders or their affiliates are reasonable and fair.
In connection with its portfolio securities transactions for the period
ended December 31, 1998, each Portfolio indicated below paid brokerage
commissions and, where determinable, concessions on principal transactions, none
of which was paid to the Distributor, in the following amounts:
NAME OF PORTFOLIO BROKERAGE COMMISSIONS PAID Concessions on Principal
TRANSACTIONS
Core Value(1) $ $
MidCap Stock(1) $ $
Founders Growth(2) $ $
Founders International
Equity(2) $ $
Founders Passport(2) $ $
- ------------------
(1) From May 1, 1998 (commencement of operations) through December 31, 1998.
(2) From _________, 1998 (commencement of operations) through December 31, 1998.
The aggregate amount of transactions during the period ended December 31,
1998 in securities effected on an agency basis through a broker for, among other
things, research services, and the commissions and concessions related to such
transactions were as follows:
NAME OF PORTFOLIO TRANSACTION AMOUNT COMMISSIONS AND CONCESSIONS
Core Value(1) $ $
MidCap Stock(1) $ $
Founders Growth(2) $ $
Founders International
Equity(2) $ $
Founders Passport(2) $ $
- ------------------
(1) From May 1, 1998 (commencement of operations) through December 31, 1998.
(2) From _________, 1998 (commencement of operations) through December 31, 1998.
PERFORMANCE INFORMATION
Performance figures for the Portfolios will not reflect the separate
charges applicable to the Policies offered by Participating Insurance Companies
or any charges by Eligible Plans.
Current yield is computed pursuant to a formula which operates as follows:
The amount of the relevant Portfolio's expenses accrued for the 30-day period
(net of reimbursements) is subtracted from the amount of the dividends and
interest earned (computed in accordance with regulatory requirements) by such
Portfolio during the period. That result is then divided by the product of: (a)
the average daily number of such Portfolio's shares outstanding during the
period that were entitled to receive dividends, and (b) the net asset value per
share on the last day of the period less any undistributed earned income per
share reasonably expected to be declared as a dividend shortly thereafter. The
quotient is then added to 1, and that sum is raised to the 6th power, after
which 1 is subtracted. The current yield is then arrived at by multiplying the
result by 2.
Average annual total return is calculated by determining the ending
redeemable value of an investment purchased with a hypothetical $1,000 payment
made at the beginning of the period (assuming the reinvestment of dividends and
distributions), dividing by the amount of the initial investment, taking the
"n"th root of the quotient (where "n" is the number of years in the period) and
subtracting 1 from the result.
Total return for each of the following Portfolios for the period indicated was:
PORTFOLIO PERIOD ENDED DECEMBER 31, 1998
- --------- ------------------------------
Core Value(1) %
MidCap Stock(1) %
Founders Growth(2) %
Founders International Equity(2) %
Founders Passport(2) %
- ------------------
(1) From May 1, 1998 (commencement of operations) through December 31, 1998.
(2) From _________, 1998 (commencement of operations) through December 31, 1998.
Total return is calculated by subtracting the amount of the relevant
Portfolio's net asset value per share at the beginning of a stated period from
the net asset value per share at the end of the period (after giving effect to
the reinvestment of dividends and distributions during the period), and dividing
the result by the net asset value per share at the beginning of the period.
Performance will vary from time to time and past results are not
necessarily representative of future results. Investors should remember that
performance is a function of portfolio management in selecting the type and
quality of portfolio securities and is affected by operating expenses.
Performance information, such as that described above, may not provide a basis
for comparison with other investments or other investment companies using a
different method of calculating performance. Performance information for a
Portfolio should not be compared with other funds that offer their shares
directly to the public since the figures provided do not reflect charges imposed
by Participating Insurance Companies under their Policies or any charges imposed
by Eligible Plans. The effective yield and total return for a Portfolio should
be distinguished from the rate of return of a corresponding sub-account or
investment division of a separate account of a Participating Insurance Company,
which rate will reflect the deduction of additional charges, including mortality
and expense risk charges, and will therefore be lower. Policy owners should
consult the prospectus for their Policy.
Calculations of the Portfolios' performance information may reflect
absorbed expenses pursuant to any undertaking that may be in effect. Comparative
performance information may be used from time to time in advertising a
Portfolio's shares, including data from Lipper Analytical Services, Inc., IBC's
Money Fund Report(TM), Money Magazine, Bank Rate Monitor(TM), Standard & Poor's
500 Composite Stock Price Index ("S&P 500 Index"), Standard & Poor's MidCap 400
Index, Russell 2500(R) Index, Morgan Stanley Capital International World (ex US)
Index, the Dow Jones Industrial Average, Morningstar, Inc., Value Line Mutual
Fund Survey and other industry publications.
From time to time, advertising materials for the Fund may refer to or
discuss then-current or past economic or financial conditions, developments
and/or events. From time to time, advertising materials for the Fund also may
refer to Morningstar ratings and related analyses supporting the rating, and may
refer to, or include, commentary by the Fund's portfolio managers relating to
their investment strategy, asset growth of the Portfolio, current or past
business, political, economic or financial conditions and other matters of
general interest to shareholders.
INFORMATION ABOUT THE FUND AND PORTFOLIOS
Each Portfolio share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and non-assessable.
Portfolio shares are of one class and have equal rights as to dividends and in
liquidation. Shares have no preemptive, subscription or conversion rights and
are freely transferable.
Under Massachusetts law, shareholders, under certain circumstances, could
be held personally liable for the obligations of the Fund. However, the Fund's
Agreement and Declaration of Trust (the "Trust Agreement") disclaims shareholder
liability for acts or obligations of the Fund and requires that notice of such
disclaimer be given in each agreement, obligation or instrument entered into or
executed by the Fund or a Trustee. The Trust Agreement provides for
indemnification from the Fund's property for all losses and expenses of any
shareholder held personally liable for the obligations of the Fund. Thus, the
risk of a shareholder's incurring financial loss on account of shareholder
liability is limited to circumstances in which the Fund itself would be unable
to meet its obligations, a possibility which management believes is remote. Upon
payment of any liability incurred by the Fund, the shareholder paying such
liability will be entitled to reimbursement from the general assets of the Fund.
The Fund intends to conduct its operations in such a way so as to avoid, as far
as possible, ultimate liability of the shareholders for liabilities of the Fund.
Unless otherwise required by the 1940 Act, ordinarily it will not be
necessary for the Fund to hold annual meetings of shareholders. As a result,
shareholders may not consider each year the election of Board members or the
appointment of auditors. However, the holders of at least 10% of the shares
outstanding and entitled to vote may require the Fund to hold a special meeting
of shareholders for purposes of removing a Board member from office.
Shareholders may remove a Board member by the affirmative vote of two-thirds of
the Fund's outstanding voting shares. In addition, the Board will call a meeting
of shareholders for the purpose of electing Board members if, at any time, less
than a majority of the Board members then holding office have been elected by
shareholders.
The Fund is a "series fund," which is a mutual fund divided into separate
portfolios, each of which is treated as a separate entity for certain matters
under the 1940 Act and for other purposes. A shareholder of one portfolio is not
deemed to be a shareholder of any other portfolio. For certain matters
shareholders vote together as a group; as to others they vote separately by
portfolio.
To date, the Board has authorized the creation of five Portfolios of
shares. All consideration received by the Fund for shares of one of the
Portfolios, and all assets in which such consideration is invested, will belong
to that Portfolio (subject only to the rights of creditors of the Fund) and will
be subject to the liabilities related thereto. The income attributable to, and
the expenses of, one Portfolio would be treated separately from those of the
other Portfolios. The Fund has the ability to create, from time to time, new
series without shareholder approval.
Rule 18f-2 under the 1940 Act provides that any matter required to be
submitted under the provisions of the 1940 Act or applicable state law or
otherwise to the holders of the outstanding voting securities of any investment
company, such as the Fund, will not be deemed to have been effectively acted
upon unless approved by the holders of a majority of the outstanding shares of
each portfolio affected by such matter. Rule 18f-2 further provides that a
portfolio shall be deemed to be affected by a matter unless it is clear that the
interests of each portfolio in the matter are identical or that the matter does
not affect any interest of such portfolio. However, the Rule exempts the
selection of independent accountants and the election of Board members from the
separate voting requirements of the rule.
The Fund sends annual and semi-annual financial statements to all its
shareholders.
COUNSEL AND INDEPENDENT AUDITORS
Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New York, New York
10038-4982, as counsel for the Fund, has rendered its opinion as to certain
legal matters regarding the due authorization and valid issuance of the shares
being sold pursuant to the Fund's Prospectuses.
Ernst & Young LLP, 787 Seventh Avenue, New York, New York 10019,
independent auditors, have been selected as independent auditors of the Fund.
The auditors examine the Fund's financial statements and provide other audit,
tax and related services.
<PAGE>
APPENDIX
Description of certain ratings:
S&P
Bond Ratings
AAA
Bonds rated AAA have the highest rating assigned to a debt obligation.
Capacity to pay interest and repay principal is extremely strong.
AA
Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the highest rated issues only in small degree.
A
Bonds rated A have a strong capacity to pay interest and repay principal
although they are somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than bonds in higher rated categories.
BBB
Bonds rated BBB are regarded as having an adequate capacity to pay interest
and repay principal. Whereas they normally exhibit 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
bonds in this category than for bonds in higher rated categories.
BB
Bonds rated BB have less near-term vulnerability to default than other
speculative grade bonds. However, they face 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.
B
Bonds rated B have a greater vulnerability to default but presently have
the capacity to meet interest payments and principal repayments. Adverse
business, financial or economic conditions would likely impair capacity or
willingness to pay interest and repay principal.
CCC
Bonds rated CCC have a current identifiable vulnerability to default, and
are dependent upon favorable business, financial and economic conditions to meet
timely payments of interest and repayment of principal. In the event of adverse
business, financial or economic conditions, they are not likely to have the
capacity to pay interest and repay principal.
CC
The rating CC is typically applied to bonds subordinated to senior debt
which is assigned an actual or implied CCC rating.
C
The rating C is typically applied to bonds subordinated to senior debt
which is assigned an actual or implied CCC- rating.
D
Bonds rated D are in default, and payment of interest and/or repayment of
principal is in arrears.
S&P's letter ratings may be modified by the addition of a plus or a minus
sign, which is used to show relative standing within the major ratings
categories, except in the AAA (Prime Grade) category.
Commercial Paper Ratings
An S&P commercial paper rating is a current assessment of the likelihood of
timely payment of debt having an original maturity of no more than 365 days.
Issues assigned an A rating are regarded as having the greatest capacity for
timely payment. Issues in this category are delineated with the numbers 1, 2 and
3 to indicate the relative degree of safety.
A-1
This designation indicates the degree of safety regarding timely payment is
either overwhelming or very strong. Those issues determined to possess
overwhelming safety characteristics are denoted with a plus sign (+)
designation.
A-2
Capacity for timely payment on issues with this designation is strong.
However, the relative degree of safety is not as high as for issues designated
A-1.
Moody's
Bond Ratings
Aaa
Bonds which 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
edge." 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 which 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 in Aaa securities.
A
Bonds which 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 which 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 which 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 which 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 which 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 which are rated Ca present obligations which are speculative in a
high degree. Such issues are often in default or have other marked shortcomings.
C
Bonds which 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.
Moody's applies the numerical modifiers 1, 2 and 3 to show relative
standing within the major rating categories, except in the Aaa category and in
the categories below B. The modifier 1 indicates a rating for the security in
the higher end of a rating category; the modifier 2 indicates a mid-range
ranking; and the modifier 3 indicates a ranking in the lower end of a rating
category.
Commercial Paper Ratings
The rating Prime-1 (P-1) is the highest commercial paper rating assigned by
Moody's. Issuers of P-1 paper must have a superior capacity for repayment of
short-term promissory obligations, and ordinarily will be evidenced by leading
market positions in well established industries, high rates of return on funds
employed, conservative capitalization structures with moderate reliance on debt
and ample asset protection, broad margins in earnings coverage of fixed
financial charges and high internal cash generation, and well established access
to a range of financial markets and assured sources of alternate liquidity.
Issuers (or related supporting institutions) rated Prime-2 (P-2) have a
strong capacity for repayment of short-term promissory obligations. This
ordinarily will be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be more
subject to variation. Capitalization characteristics, while still appropriate,
may be more affected by external conditions. Ample alternate liquidity is
maintained.
Fitch
Bond Ratings
The ratings represent Fitch's assessment of the issuer's ability to meet
the obligations of a specific debt issue or class of debt. The ratings take into
consideration special features of the issue, its relationship to other
obligations of the issuer, the current financial condition and operative
performance of the issuer and of any guarantor, as well as the political and
economic environment that might affect the issuer's future financial strength
and credit quality.
AAA
Bonds rated AAA are considered to be investment grade and of the highest
credit quality. The obligor has an exceptionally strong ability to pay interest
and repay principal, which is unlikely to be affected by reasonably foreseeable
events.
AA
Bonds rated AA are considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and repay principal is
very strong, although not quite as strong as bonds rated AAA. Because bonds
rated in the AAA and AA categories are not significantly vulnerable to
foreseeable future developments, short-term debt of these issuers is generally
rated F-1+.
A
Bonds rated A are considered to be investment grade and of high credit
quality. The obligor's ability to pay interest and repay principal is considered
to be strong, but may be more vulnerable to adverse changes in economic
conditions and circumstances than bonds with higher ratings.
BBB
Bonds rated BBB are considered to be investment grade and of satisfactory
credit quality. The obligor's ability to pay interest and repay principal is
considered to be adequate. Adverse changes in economic conditions and
circumstances, however, are more likely to have an adverse impact on these bonds
and, therefore, impair timely payment. The likelihood that the ratings of these
bonds will fall below investment grade is higher than for bonds with higher
ratings.
BB
Bonds rated BB are considered speculative. The obligor's ability to pay
interest and repay principal may be affected over time by adverse economic
changes. However, business and financial alternatives can be identified which
could assist the obligor in satisfying its debt service requirements.
B
Bonds rated B are considered highly speculative. While bonds in this class
are currently meeting debt service requirements, the probability of continued
timely payment of principal and interest reflects the obligor's limited margin
of safety and the need for reasonable business and economic activity throughout
the life of the issue.
CCC
Bonds rated CCC have certain identifiable characteristics, which, if not
remedied, may lead to default. The ability to meet obligations requires an
advantageous business and economic environment.
CC
Bonds rated CC are minimally protected. Default in payment of interest
and/or principal seems probable over time.
C
Bonds rated C are in imminent default in payment of interest or principal.
DDD, DD and D
Bonds rated DDD, DD and D are in actual default of interest and/or
principal payments. Such bonds are extremely speculative and should be valued on
the basis of their ultimate recovery value in liquidation or reorganization of
the obligor. DDD represents the highest potential for recovery on these bonds
and D represents the lowest potential for recovery.
Plus (+) and minus (-) signs are used with a rating symbol to indicate the
relative position of a credit within the rating category.
Short-Term Ratings
Fitch's short-term ratings apply to debt obligations that are payable on
demand or have original maturities of up to three years, including commercial
paper, certificates of deposit, medium-term notes, and municipal and investment
notes.
Although the credit analysis is similar to Fitch's bond rating analysis,
the short-term rating places greater emphasis than bond ratings on the existence
of liquidity necessary to meet the issuer's obligations in a timely manner.
F-1+
Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.
F-1
Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated F-1+.
Duff
Bond Ratings
AAA
Bonds rated AAA are considered highest credit quality. The risk factors are
negligible, being only slightly more than for risk-free U.S. Treasury debt.
AA
Bonds rated AA are considered high credit quality. Protection factors are
strong. Risk is modest but may vary slightly from time to time because of
economic conditions.
A
Bonds rated A have protection factors which are average but adequate.
However, risk factors are more variable and greater in periods of economic
stress.
BBB
Bonds rated BBB are considered to have below average protection factors but
still considered sufficient for prudent investment. Considerable variability in
risk exists during economic cycles.
BB
Bonds rated BB are below investment grade but are deemed by Duff as likely
to meet obligations when due. Present or prospective financial protection
factors fluctuate according to industry conditions or company fortunes. Overall
quality may move up or down frequently within the category.
B
Bonds rated B are below investment grade and possess the risk that
obligations will not be met when due. Financial protection factors will
fluctuate widely according to economic cycles, industry conditions and/or
company fortunes. Potential exists for frequent changes in quality rating within
this category or into a higher or lower quality rating grade.
CCC
Bonds rated CCC are well below investment grade securities. Such bonds may
be in default or have considerable uncertainty as to timely payment of interest,
preferred dividends and/or principal. Protection factors are narrow and risk can
be substantial with unfavorable economic or industry conditions and/or with
unfavorable company developments.
DD
Defaulted debt obligations. Issuer has failed to meet scheduled principal
and/or interest payments.
Plus (+) and minus (-) signs are used with a rating symbol (except AAA) to
indicate the relative position of a credit within the rating category.
Commercial Paper Rating
The rating Duff-1 is the highest commercial paper rating assigned by Duff.
Paper rated Duff-1 is regarded as having very high certainty of timely payment
with excellent liquidity factors which are supported by ample asset protection.
Risk factors are minor.
<PAGE>
DREYFUS INVESTMENT PORTFOLIOS
PART C. OTHER INFORMATION
-------------------------
Item 23. Exhibits
- ------- ----------
(a) Registrant's Agreement and Declaration of Trust is incorporated by
reference to the Registration Statement on Form N-1A, filed on
February 28, 1998.
(b) Registrant's By-Laws are incorporated by reference to the Registration
Statement on Form N-1A, filed on February 28, 1998.
(d)(1) Management Agreement is incorporated by reference to Exhibit (5)(a) of
Post-Effective Amendment No. 2 to the Registration Statement on Form
N-1A, filed on September 15, 1998.
(d)(2) Sub-investment Advisory Agreement is incorporated by reference to
Post-Effective Amendment No. 1 to the Registration Statement on Form
N-1A, filed on July 17, 1998.
(e) Distribution Agreement is incorporated by reference to Exhibit (6) of
Post-Effective Amendment No. 2 to the Registration Statement on Form
N-1A, filed on September 15, 1998.
(g) Custody Agreement is incorporated by reference to Exhibit 8 of
Pre-Effective Amendment No. 1 to the Registration Statement on Form
N-1A, filed on April 24, 1998.
(i) Opinion and consent of Registrant's counsel is incorporated by
reference to Exhibit (10) of Pre-Effective Amendment No. 1 to the
Registration Statement on Form N-1A, filed on April 24, 1998.
(j) Consent of Independent Auditors.*
(n) Financial Data Schedule.*
- --------------------
* To be filed by amendment.
Other Exhibits
--------------
(a) Certificate of Secretary is incorporated by reference to
Other Exhibits (a) of Pre-Effective Amendment No. 1 to
the Registration Statement on Form N-1A, filed on
April 24, 1998.
(b) Rule 18f-1 Election Assistant is incorporated by reference
to Other Exhibits (b) of Pre-Effective Amendment No. 1 to
the Registration Statement on Form N-1A, filed on April 24,
1998.
Item 24. Persons Controlled by or under Common Control with Registrant.
- ------- --------------------------------------------------------------
Not Applicable
Item 25. Indemnification
- ------- ---------------
The Statement as to the general effect of any contract, arrangements
or statute under which a director, officer, underwriter or affiliated
person of the Registrant is insured or indemnified in any manner
against any liability which may be incurred in such capacity, other
than insurance provided by any director, officer, affiliated person or
underwriter for their own protection, is incorporated by reference to
Item 27 of Part C of Post-Effective Amendment No. 2 to the
Registration Statement on Form N-1A, filed on September 15, 1998.
Reference is also made to the Distribution Agreement attached as
Exhibit (6) of Post-Effective Amendment No. 2 to the Registration
Statement on Form N-1A, filed on September 15, 1998.
Item 26. Business and Other Connections of Investment Adviser.
- ------- ----------------------------------------------------
The Dreyfus Corporation ("Dreyfus") and subsidiary companies comprise
a financial service organization whose business consists primarily of
providing investment management services as the investment adviser and
manager for sponsored investment companies registered under the
Investment Company Act of 1940 and as an investment adviser to
institutional and individual accounts. Dreyfus also serves as sub-
investment adviser to and/or administrator of other investment
companies. Dreyfus Service Corporation, a wholly-owned subsidiary of
Dreyfus, serves primarily as a registered broker-dealer. Dreyfus
Investment Advisors, Inc., another wholly-owned subsidiary, provides
investment management services to various pension plans, institutions
and individuals.
<TABLE>
<CAPTION>
Officers and Directors of Investment Adviser
<S> <C> <C> <C>
Name and Position
With Dreyfus Other Businesses Position Held Dates
Christopher M. Condron Mellon Preferred Director 3/96 - 11/96
Chairman of the Board and Capital Corporation*
Chief Executive Officer
TBCAM Holdings, Inc.* President 10/97 - 6/98
Chairman 10/97 - 6/98
The Boston Company Chairman 1/98 - 6/98
Asset Management, LLC* President 1/98 - 6/98
The Boston Company President 9/95 - 1/98
Asset Management, Inc.* Chairman 4/95 - 1/98
Chief Executive Officer 4/95 - 4/97
Pareto Partners Partner Representative 11/95 - 5/97
271 Regent Street
London, England W1R 8PP
Franklin Portfolio Holdings, Inc.* Director 1/97 - Present
Franklin Portfolio
Associates Trust* Trustee 9/95 - 1/97
Certus Asset Advisors Corp.**
Director 6/95 - Present
The Boston Company of Director 6/95 - 4/96
Southern California Chief Executive Officer 6/95 - 4/96
Los Angeles, CA
Mellon Capital Management Director 5/95 - Present
Corporation***
Mellon Bond Associates, LLP+ Executive Committee 1/98 - Present
Member
Mellon Bond Associates+ Trustee 5/95 -1/98
Mellon Equity Associates, LLP+ Executive Committee 1/98 - Present
Member
Mellon Equity Associates+ Trustee 5/95 - 1/98
Boston Safe Advisors, Inc.* Director 5/95 - Present
President 5/95 - Present
Access Capital Strategies Corp. Director 5/95 - 1/97
124 Mount Auburn Street
Suite 200 North
Cambridge, MA 02138
Mellon Bank, N.A. + Chief Operating Officer 3/98 - Present
President 3/98 - Present
Vice Chairman 11/94 - Present
Mellon Bank Corporation+ Chief Operating Officer 1/99 - Present
President 1/99 - Present
Director 1/98 - Present
Vice Chairman 11/94 - 1/99
The Boston Company Financial Director 4/94- 8/96
Services, Inc.* President 4/94 - 8/96
The Boston Company, Inc.* Vice Chairman 1/94 - Present
Director 5/93 - Present
Laurel Capital Advisors, LLP+ Exec. Committee 1/98 - Present
Member
Laurel Capital Advisors+ Trustee 10/93 - 1/98
Boston Safe Deposit and Trust Chairman 3/93 - 2/96
Company of CA Chief Executive Officer 6/93 - 2/96
Los Angeles, CA Director 6/89 - 2/96
MY, Inc.* President 9/91 - 3/96
Director 9/91 - 3/96
Reco, Inc.* President 8/91 - 11/96
Director 8/91 - 11/96
Boston Safe Deposit and Trust Director 6/89 - 2/96
Company of NY
New York, NY
Boston Safe Deposit and Trust President 9/89 - 6/96
Company* Director 5/93 -Present
The Boston Company Financial President 6/89 - Present
Strategies, Inc. * Director 6/89 - Present
The Boston Company Financial President 6/89 - 1/97
Strategies Group, Inc. * Director 6/89- 1/97
Mandell L. Berman Self-Employed Real Estate Consultant, 11/74 - Present
Director 29100 Northwestern Highway Residential Builder and
Suite 370 Private Investor
Southfield, MI 48034
Burton C. Borgelt DeVlieg Bullard, Inc. Director 1/93 - Present
Director 1 Gorham Island
Westport, CT 06880
Mellon Bank Corporation+ Director 6/91 - Present
Mellon Bank, N.A. + Director 6/91 - Present
Dentsply International, Inc. Director 2/81 - Present
570 West College Avenue Chief Executive Officer 2/81 - 12/96
York, PA Chairman 3/89 - 1/96
Stephen E. Canter Dreyfus Investment Chairman of the Board 1/97 - Present
President, Chief Operating Advisors, Inc.++ Director 5/95 - Present
Officer, Chief Investment President 5/95 - Present
Officer, and Director
Founders Asset Management, LLC Acting Chief Executive 7/98 - 12/98
2930 East Third Ave. Officer
Denver, CO 80206
The Dreyfus Trust Company+++ Director 6/95 - Present
Thomas F. Eggers Dreyfus Service Corporation++ Executive Vice President 4/96 - Present
Vice Chairman - Institutional Director 9/96 - Present
and Director
Steven G. Elliott Mellon Bank Corporation+ Senior Vice Chairman 1/99 - Present
Director Chief Financial Officer 1/90 - Present
Vice Chairman 6/92 - 1/99
Treasurer 1/90 - 5/98
Mellon Bank, N.A.+ Senior Vice Chairman 3/98 - Present
Vice Chairman 6/92 - 3/98
Chief Financial Officer 1/90 - Present
Mellon EFT Services Corporation Director 10/98 - Present
Mellon Bank Center, 8th Floor
1735 Market Street
Philadelphia, PA 19103
Mellon Financial Services Director 1/96 - Present
Corporation #1 Vice President 1/96 - Present
Mellon Bank Center, 8th Floor
1735 Market Street
Philadelphia, PA 19103
Boston Group Holdings, Inc.* Vice President 5/93 - Present
APT Holdings Corporation Treasurer 12/87 - Present
Pike Creek Operations Center
4500 New Linden Hill Road
Wilmington, DE 19808
Allomon Corporation Director 12/87 - Present
Two Mellon Bank Center
Pittsburgh, PA 15259
Collection Services Corporation Controller 10/90 - Present
500 Grant Street Director 9/88 - Present
Pittsburgh, PA 15258 Vice President 9/88 - Present
Treasurer 9/88 - Present
Mellon Financial Company+ Principal Exec. Officer 1/88 - Present
Chief Financial Officer 8/87 - Present
Director 8/87 - Present
President 8/87 - Present
Mellon Overseas Investments Director 4/88 - Present
Corporation+ Chairman 7/89 - 11/97
President 4/88 - 11/97
Chief Executive Officer 4/88 - 11/97
Mellon International Investment Director 9/89 - 8/97
Corporation+
Mellon Financial Services Treasurer 12/87 - Present
Corporation # 5+
Lawrence S. Kash Dreyfus Investment Director 4/97 - Present
Vice Chairman Advisors, Inc.++
And Director
Dreyfus Brokerage Services, Inc. Chairman 11/97 - Present
401 North Maple Ave. Chief Executive Officer 11/97 - Present
Beverly Hills, CA
Dreyfus Service Corporation++ Director 1/95 - Present
President 9/96 - Present
Dreyfus Precious Metals, Inc.++ + Director 3/96 - 12/98
President 10/96 - 12/98
Dreyfus Service Director 12/94 - Present
Organization, Inc.++ President 1/97 - Present
Executive Vice President 12/94 - 1/97
Seven Six Seven Agency, Inc. ++ Director 1/97 - Present
Dreyfus Insurance Agency of Chairman 5/97 - Present
Massachusetts, Inc.++++ President 5/97 - Present
Director 5/97 - Present
The Dreyfus Trust Company+++ Chairman 1/97 - Present
President 2/97 - Present
Chief Executive Officer 2/97 - Present
Director 12/94 - Present
The Dreyfus Consumer Credit Chairman 5/97 - Present
Corporation++ President 5/97 - Present
Director 12/94 - Present
The Boston Company Advisors* Chairman 8/93 - 11/95
The Boston Company Advisors, Chairman 12/95 - Present
Inc. Chief Executive Officer 12/95 - Present
Wilmington, DE President 12/95 - Present
Cornice Acquisition Board of Managers 12/97 - Present
Company, LLC
Denver, CO
The Boston Company, Inc.* Director 5/93 - Present
President 5/93 - Present
Mellon Bank, N.A.+ Executive Vice President 2/92 - Present
Laurel Capital Advisors, LLP+ President 12/91 - Present
Executive Committee 12/91 - Present
Member
Boston Group Holdings, Inc.* Director 5/93 - Present
President 5/93 - Present
Martin G. McGuinn Mellon Bank Corporation+ Chairman 1/99 - Present
Director Chief Executive Officer 1/99 - Present
Director 1/98 - Present
Vice Chairman 1/90 - 1/99
Mellon Bank, N. A. + Chairman 3/98 - Present
Chief Executive Officer 3/98 - Present
Director 1/98 - Present
Vice Chairman 1/90 - 1/99
Mellon Leasing Corporation+ Vice Chairman 12/96 - Present
Mellon Bank (DE) National Director 4/89 - 12/98
Association
Wilmington, DE
Mellon Bank (MD) National Director 1/96 - 4/98
Association
Rockville, Maryland
Mellon Financial Vice President 9/86 - 10/97
Corporation (MD)
Rockville, Maryland
J. David Officer Dreyfus Service Corporation++ Executive Vice President 5/98 - Present
Vice Chairman
And Director Dreyfus Insurance Agency of Director 5/98 - Present
Massachusetts, Inc.++++
Seven Six Seven Agency, Inc.++ Director 10/98 - Present
Mellon Residential Funding Corp. + Director 4/97 - Present
Mellon Trust of Florida, N.A. Director 8/97 - Present
2875 Northeast 191st Street
North Miami Beach, FL 33180
Mellon Bank, NA+ Executive Vice President 7/96 - Present
The Boston Company, Inc.* Vice Chairman 1/97 - Present
Director 7/96 - Present
Mellon Preferred Capital Director 11/96 - Present
Corporation*
RECO, Inc.* President 11/96 - Present
Director 11/96 - Present
The Boston Company Financial President 8/96 - Present
Services, Inc.* Director 8/96 - Present
Boston Safe Deposit and Trust Director
Company* President 7/96 - Present
Executive Vice President 7/96 - 1/99
1/91 - 7/96
Mellon Trust of New York Director
1301 Avenue of the Americas 6/96 - Present
New York, NY 10019
Mellon Trust of California Director 6/96 - Present
400 South Hope Street
Suite 400
Los Angeles, CA 90071
Mellon Bank, N.A.+ Executive Vice President 2/94 - Present
Mellon United National Bank Director 3/98 - Present
1399 SW 1st Ave., Suite 400
Miami, Florida
Boston Group Holdings, Inc.* Director 12/97 - Present
Dreyfus Financial Services Corp. + Director 9/96 - Present
Dreyfus Investment Services Director 4/96 - Present
Corporation+
Richard W. Sabo Founders Asset Management LLC President 12/98 - Present
Director 2930 East Third Avenue Chief Executive Officer 12/98 - Present
Denver, CO. 80206
Prudential Securities Senior Vice President 07/91 - 11/98
New York, NY Regional Director 07/91 - 11/98
Richard F. Syron American Stock Exchange Chairman 4/94 - Present
Director 86 Trinity Place Chief Executive Officer 4/94 - Present
New York, NY 10006
Ronald P. O'Hanley Franklin Portfolio Holdings, Inc.* Director 3/97 - Present
Vice Chairman
TBCAM Holdings, Inc.* Chairman 6/98 - Present
Director 10/97 - Present
The Boston Company Asset Chairman 6/98 - Present
Management, LLC* Director 1/98 - 6/98
The Boston Company Asset Director 2/97 - 12/97
Management, Inc. *
Boston Safe Advisors, Inc. * Chairman 6/97 - Present
Director 2/97 - Present
Pareto Partners Partner Representative 5/97 - Present
271 Regent Street
London, England W1R 8PP
Mellon Capital Management Director 5/97 -Present
Corporation***
Certus Asset Advisors Corp.** Director 2/97 - Present
Mellon Bond Associates+ Trustee 2/97 - Present
Chairman 2/97 - Present
Mellon Equity Associates+ Trustee 2/97 - Present
Chairman 2/97 - Present
Mellon-France Corporation+ Director 3/97 - Present
Laurel Capital Advisors+ Trustee 3/97 - Present
McKinsey & Company, Inc. Partner 8/86 - 2/97
Boston, MA
Mark N. Jacobs Dreyfus Investment Director 4/97 -Present
General Counsel, Advisors, Inc.++ Secretary 10/77 - 7/98
Vice President, and
Secretary The Dreyfus Trust Company+++ Director 3/96 - Present
The TruePenny Corporation++ President 10/98 - Present
Director 3/96 - Present
Lion Management, Inc.++ Director 1/88 - 10/96
Vice President 1/88 - 10/96
Secretary 1/88 - 10/96
The Dreyfus Consumer Credit Secretary 4/83 - 3/96
Corporation++
Dreyfus Service Director 3/97 - Present
Organization, Inc.++ Assistant Secretary 4/83 -3/96
Major Trading Corporation++ Assistant Secretary 5/81 - 8/96
William H. Maresca The Dreyfus Trust Company+++ Director 3/97 - Present
Controller
Dreyfus Service Corporation++ Chief Financial Officer 12/98 - Present
Dreyfus Consumer Credit Corp.++ Treasurer 10/98 - Present
Dreyfus Investment Treasurer 10/98 - Present
Advisors, Inc. ++
Dreyfus-Lincoln, Inc. Vice President 10/98 - Present
4500 New Linden Hill Road
Wilmington, DE 19808
The TruePenny Corporation++ Vice President 10/98 - Present
Dreyfus Precious Metals, Inc.+++ Treasurer 10/98 - 12/98
The Trotwood Corporation++ Vice President 10/98 - Present
Trotwood Hunters Corporation++ Vice President 10/98 - Present
Trotwood Hunters Site A Corp. ++ Vice President 10/98 - Present
Dreyfus Transfer, Inc. Chief Financial Officer 5/98 - Present
One American Express Plaza,
Providence, RI 02903
Dreyfus Service Assistant Treasurer 3/93 - Present
Organization, Inc.++
Dreyfus Insurance Agency of Assistant Treasurer 5/98 - Present
Massachusetts, Inc.++++
William T. Sandalls, Jr. Dreyfus Transfer, Inc. Chairman 2/97 - Present
Executive Vice President One American Express Plaza,
Providence, RI 02903
Dreyfus Service Corporation++ Director 1/96 - Present
Treasurer 1/96 - 2/97
Executive Vice President 2/97 - Present
Chief Financial Officer 2/97 - 12/98
Dreyfus Investment Director 1/96 - Present
Advisors, Inc.++ Treasurer 1/96 - 10/98
Dreyfus-Lincoln, Inc. Director 12/96 - Present
4500 New Linden Hill Road President 1/97 - Present
Wilmington, DE 19808
Dreyfus Acquisition Corporation++ Director VP and CFO 1/96 - 8/96
Vice President 1/96 - 8/96
Chief Financial Officer 1/96 - 8/96
Lion Management, Inc.++ Director 1/96 - 10/96
President 1/96 - 10/96
Seven Six Seven Agency, Inc.++ Director 1/96 - 10/98
Treasurer 10/96 - 10/98
The Dreyfus Consumer Director 1/96 - Present
Credit Corp.++ Vice President 1/96 - Present
Treasurer 1/97 - 10/98
Dreyfus Partnership President 1/97 - 6/97
Management, Inc.++ Director 1/96 - 6/97
Dreyfus Service Organization, Director 1/96 - 6/97
Inc.++ Executive Vice President 1/96 - 6/97
Treasurer 10/96 - Present
Dreyfus Insurance Agency of Director 5/97 - Present
Massachusetts, Inc.++++ Treasurer 5/97 - Present
Executive Vice President 5/97 - Present
Major Trading Corporation++ Director 1/96 - 8/96
Treasurer 1/96 - 8/96
The Dreyfus Trust Company+++ Director 1/96 - 4/97
Treasurer 1/96 - 4/97
Chief Financial Officer 1/96 - 4/97
Dreyfus Personal Director 1/96 - 4/97
Management, Inc.++ Treasurer 1/96 - 4/97
Patrice M. Kozlowski None
Vice President - Corporate
Communications
Mary Beth Leibig None
Vice President -
Human Resources
Andrew S. Wasser Mellon Bank Corporation+ Vice President 1/95 - Present
Vice President -
Information Systems
Theodore A. Schachar Dreyfus Service Corporation++ Vice President -Tax 10/96 - Present
Vice President - Tax
Dreyfus Investment Advisors, Inc.++ Vice President - Tax 10/96 - Present
Dreyfus Precious Metals, Inc. +++ Vice President - Tax 10/96 - 12/98
Dreyfus Service Organization, Inc.++ Vice President - Tax 10/96 - Present
Wendy Strutt None
Vice President
Richard Terres None
Vice President
James Bitetto The TruePenny Corporation++ Secretary 9/98 - Present
Assistant Secretary
Dreyfus Service Corporation++ Assistant Secretary 8/98 - Present
Dreyfus Investment Assistant Secretary 7/98 - Present
Advisors, Inc.++
Dreyfus Service Assistant Secretary 7/98 - Present
Organization, Inc.++
Steven F. Newman Dreyfus Transfer, Inc. Vice President 2/97 - Present
Assistant Secretary One American Express Plaza Director 2/97 - Present
Providence, RI 02903 Secretary 2/97 - Present
Dreyfus Service Secretary 7/98 - Present
Organization, Inc.++ Assistant Secretary 5/98 - 7/98
- -------------------------------
* The address of the business so indicated is One Boston Place, Boston, Massachusetts, 02108.
** The address of the business so indicated is One Bush Street, Suite 450, San Francisco, California 94104.
*** The address of the business so indicated is 595 Market Street, Suite 3000, San Francisco, California 94105.
+ The address of the business so indicated is One Mellon Bank Center, Pittsburgh, Pennsylvania 15258.
++ The address of the business so indicated is 200 Park Avenue, New York, New York 10166.
+++ The address of the business so indicated is 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144.
++++The address of the business so indicated is 53 State Street, Boston, Massachusetts 02109
</TABLE>
<PAGE>
Item 27. Principal Underwriters
- -------- ----------------------
(a) Other investment companies for which Registrant's principal
underwriter (exclusive distributor) acts as principal underwriter or exclusive
distributor:
1) Comstock Partners Funds, Inc.
2) Dreyfus A Bonds Plus, Inc.
3) Dreyfus Appreciation Fund, Inc.
4) Dreyfus Asset Allocation Fund, Inc.
5) Dreyfus Balanced Fund, Inc.
6) Dreyfus BASIC GNMA Fund
7) Dreyfus BASIC Money Market Fund, Inc.
8) Dreyfus BASIC Municipal Fund, Inc.
9) Dreyfus BASIC U.S. Government Money Market Fund
10) Dreyfus California Intermediate Municipal Bond Fund
11) Dreyfus California Tax Exempt Bond Fund, Inc.
12) Dreyfus California Tax Exempt Money Market Fund
13) Dreyfus Cash Management
14) Dreyfus Cash Management Plus, Inc.
15) Dreyfus Connecticut Intermediate Municipal Bond Fund
16) Dreyfus Connecticut Municipal Money Market Fund, Inc.
17) Dreyfus Florida Intermediate Municipal Bond Fund
18) Dreyfus Florida Municipal Money Market Fund
19) The Dreyfus Fund Incorporated
20) Dreyfus Global Bond Fund, Inc.
21) Dreyfus Global Growth Fund
22) Dreyfus GNMA Fund, Inc.
23) Dreyfus Government Cash Management Funds
24) Dreyfus Growth and Income Fund, Inc.
25) Dreyfus Growth and Value Funds, Inc.
26) Dreyfus Growth Opportunity Fund, Inc.
27) Dreyfus Debt and Equity Funds
28) Dreyfus Index Funds, Inc.
29) Dreyfus Institutional Money Market Fund
30) Dreyfus Institutional Preferred Money Market Fund
31) Dreyfus Institutional Short Term Treasury Fund
32) Dreyfus Insured Municipal Bond Fund, Inc.
33) Dreyfus Intermediate Municipal Bond Fund, Inc.
34) Dreyfus International Funds, Inc.
35) Dreyfus Investment Grade Bond Funds, Inc.
36) Dreyfus Investment Portfolios
37) The Dreyfus/Laurel Funds, Inc.
38) The Dreyfus/Laurel Funds Trust
39) The Dreyfus/Laurel Tax-Free Municipal Funds
40) Dreyfus LifeTime Portfolios, Inc.
41) Dreyfus Liquid Assets, Inc.
42) Dreyfus Massachusetts Intermediate Municipal Bond Fund
43) Dreyfus Massachusetts Municipal Money Market Fund
44) Dreyfus Massachusetts Tax Exempt Bond Fund
45) Dreyfus MidCap Index Fund
46) Dreyfus Money Market Instruments, Inc.
47) Dreyfus Municipal Bond Fund, Inc.
48) Dreyfus Municipal Cash Management Plus
49) Dreyfus Municipal Money Market Fund, Inc.
50) Dreyfus New Jersey Intermediate Municipal Bond Fund
51) Dreyfus New Jersey Municipal Bond Fund, Inc.
52) Dreyfus New Jersey Municipal Money Market Fund, Inc.
53) Dreyfus New Leaders Fund, Inc.
54) Dreyfus New York Insured Tax Exempt Bond Fund
55) Dreyfus New York Municipal Cash Management
56) Dreyfus New York Tax Exempt Bond Fund, Inc.
57) Dreyfus New York Tax Exempt Intermediate Bond Fund
58) Dreyfus New York Tax Exempt Money Market Fund
59) Dreyfus U.S. Treasury Intermediate Term Fund
60) Dreyfus U.S. Treasury Long Term Fund
61) Dreyfus 100% U.S. Treasury Money Market Fund
62) Dreyfus U.S. Treasury Short Term Fund
63) Dreyfus Pennsylvania Intermediate Municipal Bond Fund
64) Dreyfus Pennsylvania Municipal Money Market Fund
65) Dreyfus Premier California Municipal Bond Fund
66) Dreyfus Premier Equity Funds, Inc.
67) Dreyfus Premier International Funds, Inc.
68) Dreyfus Premier GNMA Fund
69) Dreyfus Premier Worldwide Growth Fund, Inc.
70) Dreyfus Premier Municipal Bond Fund
71) Dreyfus Premier New York Municipal Bond Fund
72) Dreyfus Premier State Municipal Bond Fund
73) Dreyfus Premier Value Fund
74) Dreyfus Short-Intermediate Government Fund
75) Dreyfus Short-Intermediate Municipal Bond Fund
76) The Dreyfus Socially Responsible Growth Fund, Inc.
77) Dreyfus Stock Index Fund, Inc.
78) Dreyfus Tax Exempt Cash Management
79) The Dreyfus Third Century Fund, Inc.
80) Dreyfus Treasury Cash Management
81) Dreyfus Treasury Prime Cash Management
82) Dreyfus Variable Investment Fund
83) Dreyfus Worldwide Dollar Money Market Fund, Inc.
84) Founders Funds, Inc.
85) General California Municipal Bond Fund, Inc.
86) General California Municipal Money Market Fund
87) General Government Securities Money Market Fund, Inc.
88) General Money Market Fund, Inc.
88) General Municipal Bond Fund, Inc.
90) General Municipal Money Market Funds, Inc.
91) General New York Municipal Bond Fund, Inc.
92) General New York Municipal Money Market Fund
(b)
Positions and
Name and principal Positions and offices with offices with
business address the Distributor Registrant
- ------------------ --------------------------- -------------
Marie E. Connolly+ Director, President, Chief President and
Executive Officer and Chief Treasurer
Compliance Officer
Joseph F. Tower, III+ Director, Senior Vice President, Vice President
Treasurer and Chief Financial and Assistant
Officer Treasurer
Mary A. Nelson+ Vice President Vice President
and Assistant
Treasurer
Jean M. O'Leary+ Assistant Vice President, None
Assistant Secretary and
Assistant Clerk
William J. Nutt+ Chairman of the Board None
Michael S. Petrucelli++ Senior Vice President Vice President,
Assistant
Treasurer, and
Assistant Secretary
Patrick W. McKeon+ Vice President None
Joseph A. Vignone+ Vice President None
- --------------------------------
+ Principal business address is 60 State Street, Boston, Massachusetts 02109.
++ Principal business address is 200 Park Avenue, New York, New York 10166.
<PAGE>
Item 28. Location of Accounts and Records
- ------- --------------------------------
1. First Data Investor Services Group, Inc.,
a subsidiary of First Data Corporation
P.O. Box 9671
Providence, Rhode Island 02940-9671
2. Mellon Bank, N.A.
One Mellon Bank Center
Pittsburgh, Pennsylvania 15258
3. The Bank of New York
90 Washington Street
New York, New York 10286
4. Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, Rhode Island 02940-9671
5. The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
6. Founders Asset Management LLC
Founders Financial Center
2930 East Third Center
Denver, Colorado 80206
Item 29. Management Services
- ------- -------------------
Not Applicable
Item 30. Undertakings
- ------- ------------
None
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant has duly caused this Amendment to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, and State of New York on the
24th day of February, 1999.
DREYFUS INVESTMENT PORTFOLIOS
--------------------------------------------
(Registrant)
BY: /s/Marie E. Connolly*
----------------------------
Marie E. Connolly, PRESIDENT
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below by the following persons in
the capacities and on the date indicated.
Signature Title Date
- -------------------------- ------------------- ----------
/s/ Marie E. Connolly* President and Treasurer (Principal 2/24/99
- --------------------- Executive Officer)
Marie E. Connolly
/s/ Joseph F. Tower, III* Vice President and Assistant 2/24/99
- ------------------------ Treasurer (Principal Financial
Joseph F. Tower, III and Accounting Officer)
/s/ Joseph S. DiMartino* Chairman of the Board 2/24/99
- ------------------------
Joseph S. DiMartino
/s/ Clifford L. Alexander,Jr.* Board Member 2/24/99
- --------------------------
Clifford L. Alexander, Jr.
/s/ Lucy Wilson Benson* Board Member 2/24/99
- --------------------------
Lucy Wilson Benson
*BY: /s/ Michael S. Petrucelli
----------------------------------
Michael S. Petrucelli,
Attorney-in-Fact
