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COMBINED PROSPECTUS June 1, 1997
As Revised August 25, 1997
GENERAL MONEY MARKET FUND, INC.
GENERAL GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
CLASS A SHARES
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GENERAL GOVERNMENT SECURITIES MONEY MARKET FUND, INC. AND GENERAL
MONEY MARKET FUND, INC. (EACH, A "FUND" AND COLLECTIVELY, THE "FUNDS") ARE
OPEN-END, DIVERSIFIED, MANAGEMENT INVESTMENT COMPANIES, KNOWN AS MONEY MARKET
MUTUAL FUNDS. EACH FUND'S INVESTMENT OBJECTIVE IS TO PROVIDE YOU WITH AS HIGH
A LEVEL OF CURRENT INCOME AS IS CONSISTENT WITH THE PRESERVATION OF CAPITAL
AND, IN THE CASE OF GENERAL GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
ONLY, THE MAINTENANCE OF LIQUIDITY.
YOU CAN INVEST, REINVEST OR REDEEM SHARES AT ANY TIME WITHOUT CHARGE
OR PENALTY IMPOSED BY A FUND.
THE DREYFUS CORPORATION PROFESSIONALLY MANAGES EACH FUND'S PORTFOLIO.
EACH FUND'S SHARES MAY BE PURCHASED ONLY BY CLIENTS OF SERVICE AGENTS
AS DESCRIBED HEREIN. BY THIS PROSPECTUS, EACH FUND IS OFFERING CLASS A
SHARES. CLASS B SHARES ARE OFFERED BY THE FUNDS PURSUANT TO A SEPARATE
PROSPECTUS AND ARE NOT OFFERED HEREBY. THE CLASSES ARE IDENTICAL, EXCEPT AS
TO THE SERVICES OFFERED TO AND THE EXPENSES BORNE BY EACH CLASS WHICH MAY
AFFECT PERFORMANCE. IF YOU WOULD LIKE TO OBTAIN INFORMATION ABOUT CLASS B
SHARES, PLEASE WRITE TO THE ADDRESS OR CALL THE NUMBER SET FORTH BELOW.
AN INVESTMENT IN THE FUNDS IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT. THERE CAN BE NO ASSURANCE THAT THE FUNDS WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
GENERAL GOVERNMENT SECURITIES MONEY MARKET FUND, INC. (the "Government Money
Fund") invests in U.S. Government securities and repurchase agreements in
respect of U.S. Government securities.
GENERAL MONEY MARKET FUND, INC. (the "Money Fund") invests in short-term
money market obligations including U.S. Government securities, certificates
of deposit and other domestic and foreign bank obligations, repurchase
agreements, commercial paper, and other short-term corporate obligations, as
more fully described herein.
Each Fund is a separate entity with a separate portfolio. The
operations and results of one Fund are unrelated to those of the other Fund.
This combined Prospectus has been prepared for your convenience to provide
you the opportunity to consider two investment choices in one document.
THIS PROSPECTUS SETS FORTH CONCISELY INFORMATION ABOUT EACH FUND THAT
YOU SHOULD KNOW BEFORE INVESTING. IT SHOULD BE READ AND RETAINED FOR FUTURE
REFERENCE.
A STATEMENT OF ADDITIONAL INFORMATION, DATED JUNE 1, 1997, WHICH MAY
BE REVISED FROM TIME TO TIME, PROVIDES A FURTHER DISCUSSION OF CERTAIN AREAS
IN THIS PROSPECTUS AND OTHER MATTERS WHICH MAY BE OF INTEREST TO SOME
INVESTORS. IT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AND
IS INCORPORATED HEREIN BY REFERENCE. THE SECURITIES AND EXCHANGE COMMISSION
MAINTAINS A WEB SITE (HTTP://WWW.SEC.GOV) THAT CONTAINS THE STATEMENT OF
ADDITIONAL INFORMATION, MATERIAL INCORPORATED BY REFERENCE, AND OTHER
INFORMATION REGARDING THE FUNDS. FOR A FREE COPY OF THE STATEMENT OF
ADDITIONAL INFORMATION, WRITE TO A FUND AT 144 GLENN CURTISS BOULEVARD,
UNIONDALE, NEW YORK 11556-0144, OR CALL 1-800-645-6561. WHEN TELEPHONING, ASK
FOR OPERATOR 144.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
AGENCY. MONEY MARKET MUTUAL FUND SHARES INVOLVE CERTAIN INVESTMENT RISKS,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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TABLE OF CONTENTS
Page
Annual Fund Operating Expenses........................... 3
Condensed Financial Information.......................... 4
Yield Information........................................ 5
Description of the Funds................................. 5
Management of the Funds.................................. 7
How to Buy Shares........................................ 8
Shareholder Services..................................... 10
How to Redeem Shares..................................... 14
Service Plan............................................. 16
Shareholder Services Plan................................ 16
Dividends, Distributions and Taxes....................... 17
General Information...................................... 18
Appendix................................................. 20
Page 2
<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)
GOVERNMENT
MONEY MONEY
FUND FUND
----------- -------
<S> <C> <C>
Management Fees...... ............................................ .50% .50%
12b-1 Fees.... ................................................... .20% .20%
Other Expenses.... ............................................... .12% .14%
Total Fund Operating Expenses..... ............................... .82% .84%
</TABLE>
EXAMPLE:
You would pay the following expenses on
a $1,000 investment, assuming (1) 5% annual
return and (2) redemption at the end of
each time period:
1 YEAR $ 8 $ 9
3 YEARS $ 26 $ 27
5 YEARS $ 46 $ 47
10 YEARS $ 101 $ 104
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THE AMOUNTS LISTED IN THE EXAMPLE SHOULD NOT BE CONSIDERED AS
REPRESENTATIVE OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER
OR LESS THAN THOSE INDICATED. MOREOVER, WHILE THE EXAMPLE ASSUMES A 5% ANNUAL
RETURN, EACH FUND'S ACTUAL PERFORMANCE WILL VARY AND MAY RESULT IN AN ACTUAL
RETURN GREATER OR LESS THAN 5%.
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The purpose of the foregoing table is to assist you in understanding
the costs and expenses borne by each Fund, the payment of which will reduce
investors' annual return. The information in the foregoing table does not
reflect any fee waivers or expense reimbursement arrangements that may be in
effect. Certain Service Agents (as defined below) may charge their clients
direct fees for effecting transactions in Fund shares; such fees are not
reflected in the foregoing table. See "Management of the Funds," "How to Buy
Shares," "Service Plan" and "Shareholder Services Plan."
Page 3
CONDENSED FINANCIAL INFORMATION
The information in the following tables has been audited by Ernst &
Young LLP, each Fund's independent auditors. Further financial data, related
notes and report of independent auditors accompany the Statement of
Additional Information, available upon request.
FINANCIAL HIGHLIGHTS
GOVERNMENT MONEY FUND _ Contained below is per share operating performance
data for a Class A share of Common Stock outstanding, total investment
return, ratios to average net assets and other supplemental data for each
year indicated. This information has been derived from the Government Money
Fund's financial statements.
<TABLE>
<CAPTION>
Government Money Fund
Year Ended January 31,
_________________________________________________________________________________________________
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA: 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
Net asset value, ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
beginning of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
INVESTMENT OPERATIONS:
Investment income-net.. .058 .068 .082 .072 .053 .033 .027 .038 .052 .047
DISTRIBUTIONS: ------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Dividends from investment
income-net (.058) (.068) (.082) (.072) (.053) (.033) (.027) (.038) (.052) (.047)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net asset value, end of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN.. 5.96% 6.99% 8.56% 7.42% 5.46% 3.36% 2.69% 3.90% 5.35% 4.75%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average
net assets............. .83% .87% .87% .86% .82% .82% .81% .83% .84% .82%
Ratio of net investment
income to average net assets 5.80% 6.74% 8.23% 7.14% 5.27% 3.28% 2.66% 3.82% 5.22% 4.65%
Net Assets, end of year
(000's omitted) $292,204 $263,130 $306,610 $408,817 $609,015 $725,419 $536,884 $513,345 $530,054 $519,861
MONEY FUND _ Contained below is per share operating performance data for a Class A share of Common Stock outstanding, total
investment return, ratios to average net assets and other supplemental data
for each year indicated. This information has been derived from the Money
Fund's financial statements.
</TABLE>
<TABLE>
<CAPTION>
MONEY FUND
YEAR ENDED JANUARY 31,
------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
PER SHARE DATA: 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997
Net asset value, ----- ----- ----- ----- ----- ----- ----- ----- ----- -----
beginning of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
Investment Operations: ----- ------ ------ ------ ------ ------ ------ ------ ------ ------
Investment income_net. .060 .069 .085 .074 .055 .032 .025 .037 .053 .047
Distributions: ----- ------ ------ ------ ------ ------ ------ ------ ------ ------
Dividends from investment
income_net............. (.060) (.069) (.085) (.074) (.055) (.032) (.025) (.037) (.053) (.047)
------ ------ ------ ------ ------ ------ ------ ------ ------ ------
Net asset value, end of year $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00 $1.00
====== ====== ====== ====== ====== ====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN.... 6.15% 7.10% 8.80% 7.64% 5.61% 3.26% 2.56% 3.75% 5.42% 4.81%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to
average net assets....... .95% .97% .93% .91% .92% .95% .94% .94% .86% .84%
Ratio of net investment
income to average net assets.. 6.00% 6.84% 8.43% 7.39% 5.44% 3.22% 2.53% 3.68% 5.28% 4.71%
Decrease reflected in above
expense ratios due to
undertakings by
The Dreyfus Corporation ._ ._ ._ ._ ._ ._ .02% .04% .01% ._
Net Assets, end of year
(000's omitted) $763,441 $710,810 $915,548 $677,257 $845,690 $688,785 $616,072 $572,116 $654,581 $764,119
</TABLE>
Page 4
YIELD INFORMATION
From time to time, each Fund advertises its yield and effective
yield. Both yield figures are based on historical earnings and are not
intended to indicate future performance. It can be expected that these yields
will fluctuate substantially. The yield of a Fund refers to the income
generated by an investment in the Fund over a seven-day period (which period
will be stated in the advertisement). This income is then "annualized." That
is, the amount of income generated by the investment during that week is
assumed to be generated each week over a 52-week period and is shown as a
percentage of the investment. The effective yield is calculated similarly,
but, when annualized, the income earned by an investment in the Fund is
assumed to be reinvested. The effective yield will be slightly higher than
the yield because of the compounding effect of this assumed reinvestment. A
Fund's yield and effective yield may reflect absorbed expenses pursuant to
any undertaking that may be in effect. See "Management of the Funds."
Yield information is useful in reviewing a Fund's performance, but
because yields will fluctuate, under certain conditions such information may
not provide a basis for comparison with domestic bank deposits, other
investments which pay a fixed yield for a stated period of time, or other
investment companies which may use a different method of computing yield.
Comparative performance information may be used from time to time in
advertising or marketing Fund shares, including data from Lipper Analytical
Services, Inc., Bank Rate Monitortrademark, N. Palm Beach, Fla. 33408, IBC's
Money Fund ReportTM, Morningstar, Inc. and other industry publications.
DESCRIPTION OF THE FUNDS
INVESTMENT OBJECTIVE
The investment objective of each Fund is to provide you with as high
a level of current income as is consistent with the preservation of capital
and, in the case of the Government Money Fund only, the maintenance of
liquidity. Each Fund's investment objective cannot be changed without
approval by the holders of a majority (as defined in the Investment Company
Act of 1940, as amended (the "1940 Act")) of such Fund's outstanding voting
shares. There can be no assurance that a Fund's investment objective will be
achieved. Each Fund pursues its investment objective in the manner described
below. Securities in which a Fund invests may not earn as high a level of
current income as long-term or lower quality securities which generally have
less liquidity, greater market risk and more fluctuation in market value.
MANAGEMENT POLICIES
Each Fund seeks to maintain a net asset value of $1.00 per share for
purchases and redemptions. To do so, each Fund uses the amortized cost method
of valuing its securities pursuant to Rule 2a-7 under the 1940 Act, which
Rule includes various maturity, quality and diversification requirements,
certain of which are summarized as follows. In accordance with Rule 2a-7,
each Fund is required to maintain a dollar-weighted average portfolio
maturity of 90 days or less, purchase only instruments having remaining
maturities of 13 months or less and invest only in U.S. dollar denominated
securities determined in accordance with procedures established by the Fund's
Board to present minimal credit risks and, in the case of the Money Fund,
which are rated in one of the two highest rating categories for debt
obligations by at least two nationally recognized statistical rating
organizations (or one rating organization if the instrument was rated by only
one such organization) or, if unrated, are of comparable quality as
determined in accordance with procedures established by the Money Fund's
Board. The nationally recognized statistical rating organizations currently
rating instruments of the type the Money Fund may
Page 5
purchase are Moody's Investors Service, Inc., Standard & Poor's Ratings Group,
Duff & Phelps Credit Rating Co., Fitch Investors Service, L.P., IBCA Limited
and IBCA Inc. and Thomson BankWatch, Inc. and their rating criteria are
described in the "Appendix" to the Statement of Additional Information. This
discussion concerning investment ratings does not apply to the Government
Money Fund because it invests exclusively in U.S. Government securities and
repurchase agreements in respect thereof. For further information regarding
the amortized cost method of valuing securities, see "Determination of Net
Asset Value" in the Statement of Additional Information. There can be no
assurance that either Fund will be able to maintain a stable net asset value
of $1.00 per share.
GOVERNMENT FUND _ The Fund invests in securities issued or guaranteed as to
principal and interest by the U.S. Government or its agencies or
instrumentalities, and repurchase agreements in respect of such securities.
See "Appendix _ Certain Portfolio Securities."
MONEY FUND _ The Fund invests in short-term money market obligations,
including securities issued or guaranteed by the U.S. Government or its
agencies or instrumentalities, time deposits, certificates of deposit,
bankers' acceptances and other short-term obligations issued by domestic
banks, foreign subsidiaries or foreign branches of domestic banks, domestic
and foreign branches of foreign banks and thrift institutions, repurchase
agreements, asset-backed securities, and high quality domestic and foreign
commercial paper and other short-term corporate obligations, including those
with floating or variable rates of interest. The Fund may invest in U.S.
dollar denominated obligations issued or guaranteed by one or more foreign
governments or any of their political subdivisions, agencies or
instrumentalities, including obligations of supranational entities. See
"Appendix _ Certain Portfolio Securities." During normal market conditions,
at least 25% of the value of the Fund's total assets will be invested in bank
obligations. See "Investment Considerations and Risks" below.
INVESTMENT CONSIDERATIONS AND RISKS
GENERAL _ Each Fund attempts to increase yields by trading to take advantage
of short-term market variations. This policy is expected to result in high
portfolio turnover but should not adversely affect a Fund since each Fund
usually does not pay brokerage commissions when it purchases short-term debt
obligations, including U.S. Government securities. The value of the portfolio
securities held by each Fund will vary inversely to changes in prevailing
interest rates. Thus, if interest rates have increased from the time a
security was purchased, such security, if sold, might be sold at a price less
than its cost. Similarly, if interest rates have declined from the time a
security was purchased, such security, if sold, might be sold at a price
greater than its purchase cost. In either instance, if the security was
purchased at face value and held to maturity, no gain or loss would be
realized.
FOREIGN SECURITIES (MONEY FUND ONLY) _ Since the Fund's portfolio may
contain securities issued by foreign governments, or any of their political
subdivisions, agencies or instrumentalities, and by foreign subsidiaries and
foreign branches of domestic banks, domestic and foreign branches of foreign
banks, and commercial paper issued by foreign issuers, the Fund may be
subject to additional investment risks with respect to those securities that
are different in some respects from those incurred by a fund which invests
only in debt obligations of U.S. domestic issuers, although such obligations
may be higher yielding when compared to the securities of U.S. domestic
issuers. Such risks include possible future political and economic
developments, seizure or nationalization of foreign deposits, imposition of
foreign withholding taxes on interest income payable on the securities,
establishment of exchange controls or adoption of other foreign governmental
restrictions which might adversely affect the payment of principal and
interest on these securities.
Page 6
BANK SECURITIES (MONEY FUND ONLY) _ To the extent the Fund's investments are
concentrated in the banking industry, the Fund will have correspondingly
greater exposure to the risk factors which are characteristic of such
investments. Sustained increases in interest rates can adversely affect the
availability or liquidity and cost of capital funds for a bank's lending
activities, and a deterioration in general economic conditions could increase
the exposure to credit losses. In addition, the value of and the investment
return on the Fund's shares could be affected by economic or regulatory
developments in or related to the banking industry, which industry also is
subject to the effects of competition within the banking industry as well as
with other types of financial institutions. The Fund, however, will seek to
minimize its exposure to such risks by investing only in debt securities
which are determined to be of high quality.
SIMULTANEOUS INVESTMENTS _ Investment decisions for each Fund are made
independently from those of other investment companies advised by The Dreyfus
Corporation. If, however, such other investment companies desire to invest
in, or dispose of, the same securities as a Fund, available investments or
opportunities for sales will be allocated equitably to each investment
company. In some cases, this procedure may adversely affect the size of the
position obtained for or disposed of by the Fund or the price paid or
received by the Fund.
MANAGEMENT OF THE FUNDS
INVESTMENT ADVISER _ The Dreyfus Corporation, located at 200 Park Avenue,
New York, New York 10166, was formed in 1947 and serves as each Fund's
investment adviser. The Dreyfus Corporation is a wholly-owned subsidiary of
Mellon Bank, N.A., which is a wholly-owned subsidiary of Mellon Bank
Corporation ("Mellon"). As of April 30, 1997, The Dreyfus Corporation managed
or administered approximately $83 billion in assets for approximately 1.7
million investor accounts nationwide.
The Dreyfus Corporation supervises and assists in the overall
management of each Fund's affairs under a separate Management Agreement with
the Fund, subject to the authority of the Fund's Board in accordance with
Maryland law.
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. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCO Credit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries, including The Dreyfus Corporation, Mellon managed more than
$259 billion in assets as of March 31, 1997, including approximately $88
billion in proprietary mutual fund assets. As of March 31, 1997, Mellon,
through various subsidiaries, provided non-investment services, such as
custodial or administration services, for more than $1.061 trillion in
assets, including approximately $58 billion in mutual fund assets.
For each Fund's fiscal year ended January 31, 1997, each Fund paid
The Dreyfus Corporation a monthly management fee at the annual rate of .50 of
1% of the value of such Fund's average daily net assets. From time to time,
The Dreyfus Corporation may waive receipt of its fees and/or voluntarily
assume certain expenses of a Fund, which would have the effect of lowering
the expense ratio of such Fund and increasing yield to investors. Neither
Fund will pay The Dreyfus Corporation at a later time for any amounts it may
waive, nor will either Fund reimburse The Dreyfus Corporation for any amounts
it may assume.
Page 7
In allocating brokerage transactions, The Dreyfus Corporation seeks
to obtain the best execution of orders at the most favorable net price.
Subject to this determination, The Dreyfus Corporation may consider, among
other things, the receipt of research services and/or the sale of shares of a
Fund or other funds managed, advised or administered by The Dreyfus
Corporation as factors in the selection of broker-dealers to execute
portfolio transactions for the Fund. See "Portfolio Transactions" in the
Statement of Additional Information.
The Dreyfus Corporation may pay the Funds' distributor for
shareholder services from The Dreyfus Corporation's own assets, including
past profits but not including the management fee paid by the Fund. The
Funds' distributor may use part or all of such payments to pay Service Agents
in respect of these services.
DISTRIBUTOR _ The Funds' distributor is Premier Mutual Fund Services, Inc.
(the "Distributor"), located at 60 State Street, Boston, Massachusetts 02109.
The Distributor's ultimate parent is Boston Institutional Group, Inc.
TRANSFER AND DIVIDEND DISBURSING AGENT AND CUSTODIAN _ Dreyfus Transfer,
Inc., a wholly-owned subsidiary of The Dreyfus Corporation, P.O. Box 9671,
Providence, Rhode Island 02940-9671, is each Fund's Transfer and Dividend
Disbursing Agent (the "Transfer Agent"). The Bank of New York, 90 Washington
Street, New York, New York 10286, is each Fund's Custodian.
HOW TO BUY SHARES
Each Fund's shares may be purchased only by clients of certain
financial institutions (which may include banks), securities dealers
("Selected Dealers"), and other industry professionals such as investment
advisers, accountants and estate planning firms (collectively, "Service
Agents") that have entered into service agreements with the Distributor. For
shareholders who purchase Fund shares from the Distributor, the Distributor
will act as Service Agent. Stock certificates are issued only upon your
written request. No certificates are issued for fractional shares. Each Fund
reserves the right to reject any purchase order.
The minimum initial investment in each Fund is $2,500, or $1,000 if
you are a client of a Service Agent which maintains an omnibus account in the
relevant Fund and has made an aggregate minimum initial purchase in the Fund
for its customers of $2,500. Subsequent investments must be at least $100.
The initial investment must be accompanied by the Account Application. For
full-time or part-time employees of The Dreyfus Corporation or any of its
affiliates or subsidiaries, directors of The Dreyfus Corporation, Board
members of a fund advised by The Dreyfus Corporation, including members of
each Fund's Board, or the spouse or minor child of any of the foregoing, the
minimum initial investment is $1,000. For full-time or part-time employees of
The Dreyfus Corporation or any of its affiliates or subsidiaries who elect to
have a portion of their pay directly deposited into their Fund accounts, the
minimum initial investment is $50. Each Fund reserves the right to offer Fund
shares without regard to minimum purchase requirements to employees
participating in certain qualified and non-qualified employee benefit plans
or other programs where contributions or account information can be
transmitted in a manner and form acceptable to such Fund. Each Fund reserves
the right to vary further the initial and subsequent investment minimum
requirements at any time.
You may purchase Fund shares by check or wire. Checks should be made
payable to "The Dreyfus Family of Funds" or, if for Dreyfus retirement plan
accounts, to "The Dreyfus Trust Company, Custodian." Payments to open new
accounts which are mailed should be sent to The Dreyfus Family of Funds, P.O.
Box 9387, Providence, Rhode Island 02940-9387, together with your Account
Application indicating that Class A shares are being purchased. For
subsequent investments, your Fund
Page 8
account number should appear on the check and an investment slip should be
enclosed and sent to The Dreyfus Family of Funds, P.O. Box 105, Newark, New
Jersey 07101-0105. For Dreyfus retirement plan accounts, both initial and
subsequent investments should be sent to The Dreyfus Trust Company, Custodian,
P.O. Box 6427, Providence, Rhode Island 02940-6427. Neither initial nor
subsequent investments should be made by third party check. Purchase orders
may be delivered in person only to a Dreyfus Financial Center. THESE ORDERS
WILL BE FORWARDED TO THE RELEVANT FUND AND WILL BE PROCESSED ONLY UPON RECEIPT
THEREBY. For the location of the nearest Dreyfus Financial Center, please call
one of the telephone numbers listed under "General Information." Other
purchase procedures may be in effect for clients of certain Service Agents.
Wire payments may be made to The Bank of New York if your bank
account 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 #8900052414/General Government Securities Money Market Fund, Inc.,
or DDA #8900052414/General Money Market Fund, Inc., for purchase of Fund
shares in your name. The wire must include your Fund account number (for new
accounts, your Taxpayer Identification Number ("TIN") should be included
instead), account registration and dealer number, if applicable, and must
indicate the Class of shares being purchased. If your initial purchase of
Fund shares is by wire, please call 1-800-645-6561 after completing your wire
payment to obtain your Fund account number. Please include your Fund account
number on the Account Application and promptly mail the Account Application
to the Fund, as no redemptions will be permitted until the Account
Application is received. You may obtain further information about remitting
funds in this manner from your bank. All payments should be made in U.S.
dollars and, to avoid fees and delays, should be drawn only on U.S. banks. A
charge will be imposed if any check used for investment in your account does
not clear. Each Fund makes available to certain large institutions the
ability to issue purchase instructions through compatible computer
facilities.
Fund shares also may be purchased through Dreyfus-AUTOMATIC Asset
BuilderRegistration Mark, the Government Direct Deposit Privilege or the
Payroll Savings Plan described under "Shareholder Services." These services
enable you to make regularly scheduled investments and may provide you with
a convenient way to invest for long-term financial goals. You should be
aware, however, that periodic investment plans do not guarantee a profit and
will not protect an investor against loss in a declining market.
Subsequent investments also may be made by electronic transfer of
funds from an account maintained in a bank or other domestic financial
institution that is an Automated Clearing House member. You must direct the
institution to transmit immediately available funds through the Automated
Clearing House to The Bank of New York with instructions to credit your Fund
account. The instructions must specify your Fund account registration and
your Fund account number preceded by the digits "1111."
Management understands that some Service Agents may impose certain
conditions on their clients which are different from those described in this
Prospectus and, to the extent permitted by applicable regulatory authority,
may charge their clients direct fees for Servicing (as defined under "Service
Plan"). Service Agents may receive different levels of compensation for
selling different classes of shares. You should consult your Service Agent in
this regard.
Fund shares are sold on a continuous basis at the net asset value per
share next determined after an order in proper form and Federal Funds (monies
of member banks within the Federal Reserve System which are held on deposit
at a Federal Reserve Bank) are received by the Transfer Agent or other agent
or entity subject to the direction of such agents in written or telegraphic
form. If you do not remit Federal
Page 9
Funds, your payment must be converted into Federal Funds. This usually occurs
within one business day of receipt of a bank wire and within two business days
of receipt of a check drawn on a member bank of the Federal Reserve System.
Checks drawn on banks which are not members of the Federal Reserve System may
take considerably longer to convert into Federal Funds. Prior to receipt of
Federal Funds, your money will not be invested.
Each Fund's net asset value per share is determined twice each day:
as of 5:00 p.m., New York time and as of 8:00 p.m., New York time. Net asset
value per share of each class is computed by dividing the value of the Fund's
net assets represented by such class (i.e., the value of its assets less
liabilities) by the total number of shares of such class outstanding. See
"Determination of Net Asset Value" in the Statement of Additional
Information.
If your payments are received in or converted into Federal Funds by
12:00 Noon, New York time, by the Transfer Agent, on a business day, you will
receive the dividend declared that day. If your payments are received in or
converted into Federal Funds after 12:00 Noon, New York time, by the Transfer
Agent you will begin to accrue dividends on the following business day.
Qualified institutions may telephone orders for purchase of Fund
shares. A telephone order placed to the Distributor or its designee in New
York will become effective at the price determined at 5:00 p.m., New York
time, and the shares purchased will receive the dividend on Fund shares
declared on that day, if such order is placed to the Distributor or its
designee in New York by 5:00 p.m., New York time, and Federal Funds are
received by 6:00 p.m., New York time, on that day. A telephone order placed to
the Distributor or its designee in New York after 5:00 p.m., New York time,
but by 8:00 p.m., New York time, on a given day will become effective at the
price determined at 8:00 p.m., New York time, on that day if Federal Funds
are received by 11:00 a.m., New York time, on the next business day. The
shares so purchased will begin to accrue dividends on the business day
following the date the order became effective.
The Distributor may pay dealers a fee of up to .5% of the amount
invested through such dealers in each Fund's shares by employees
participating in qualified or non-qualified employee benefit plans or other
programs where (i) the employers or affiliated employers maintaining such
plans or programs have a minimum of 250 employees eligible for participation
in such plans or programs, or (ii) such plan's or program's aggregate
investment in the Dreyfus Family of Funds or certain other products made
available by the Distributor to such plans or programs exceeds $1,000,000
("Eligible Benefit Plans"). Shares of funds in the Dreyfus Family of Funds
then held by Eligible Benefit Plans will be aggregated to determine the fee
payable. The Distributor reserves the right to cease paying these fees at any
time. The Distributor will pay such fees from its own funds, other than
amounts received from the Fund, including past profits or any other source
available to it.
Federal regulations require that you provide a certified TIN upon
opening or reopening an account. See "Dividends, Distributions and Taxes" and
the Account Application for further information concerning this requirement.
Failure to furnish a certified TIN to a Fund could subject you to a $50
penalty imposed by the Internal Revenue Service (the "IRS").
SHAREHOLDER SERVICES
The services and privileges described under this heading may not be
available to clients of certain Service Agents and some Service Agents may
impose certain conditions on their clients which are different from those
described in this Prospectus. You should consult your Service Agent in this
regard. In addition, use of the privileges noted below may require that the
proper forms and information be filed with and processed by the Transfer
Agent.
Page 10
FUND EXCHANGES _ Clients of certain Service Agents may purchase, in exchange
for shares of a Fund, shares of certain other funds managed or administered
by The Dreyfus Corporation, to the extent such shares are offered for sale in
your state of residence. These funds have different investment objectives
which may be of interest to you. If you desire to use this service, you
should consult your Service Agent or call 1-800-645-6561 to determine if it
is available and whether any conditions are imposed on its use.
To request an exchange, you or your Service Agent acting on your
behalf must give exchange instructions to the Transfer Agent in writing or by
telephone. Before any exchange, you must obtain and should review a copy of
the current prospectus of the fund into which the exchange is being made.
Prospectuses may be obtained by calling 1-800-645-6561. Except in the case of
personal retirement plans, the shares being exchanged must have a current
value of at least $500; furthermore, when establishing a new account by
exchange, the shares being exchanged must have a value of at least the
minimum initial investment required for the fund into which the exchange is
being made. The ability to issue exchange instructions by telephone is given
to shareholders of each Fund automatically, unless you check the applicable
"No" box on the Account Application, indicating that you specifically refuse
this Privilege. The Telephone Exchange Privilege may be established for an
existing account by written request signed by all shareholders on the
account, by a separate signed Shareholder Services Form, available by calling
1-800-645-6561, or by oral request from any of the authorized signatories on
the account by calling 1-800-645-6561. If you have established the Telephone
Exchange Privilege, you may telephone exchange instructions (including over
The Dreyfus TouchRegistration Mark automated telephone system) by calling
1-800-645-6561. If you are calling from overseas, call 516-794-5452. See "How
to Redeem Shares _ Procedures." Upon an exchange into a new account, the
following shareholder services and privileges, as applicable and where
available, will be automatically carried over to the fund into which the
exchange is made: Telephone Exchange Privilege, Check Redemption Privilege, Wi
re Redemption Privilege, Telephone Redemption Privilege and the
dividend/capital gain distribution option (except for Dividend Sweep)
selected by the investor.
Shares will be exchanged at the next determined net asset value;
however, a sales load may be charged with respect to exchanges into funds
sold with a sales load. If you are exchanging into a fund that charges a
sales load, you may qualify for share prices which do not include the sales
load or which reflect a reduced sales load, if the shares you are exchanging
were: (a) purchased with a sales load, (b) acquired by a previous exchange
from shares purchased with a sales load, or (c) acquired through reinvestment
of dividends or distributions paid with respect to the foregoing categories
of shares. To qualify, at the time of the exchange you must notify the
Transfer Agent or your Service Agent must notify the Distributor. Any such
qualification is subject to confirmation of your holdings through a check of
appropriate records. See "Shareholder Services" in the Statement of
Additional Information. No fees currently are charged shareholders directly
in connection with exchanges, although each Fund reserves the right, upon not
less than 60 days' written notice, to charge shareholders a nominal
administrative fee in accordance with rules promulgated by the Securities and
Exchange Commission. Each Fund reserves the right to reject any exchange
request in whole or in part. The availability of Fund Exchanges may be
modified or terminated at any time upon notice to shareholders. See
"Dividends, Distributions and Taxes."
AUTO-EXCHANGE PRIVILEGE _ The Auto-Exchange Privilege enables you to invest
regularly (on a semi-monthly, monthly, quarterly or annual basis), in
exchange for shares of a Fund, in shares of certain other funds in the
Dreyfus Family of Funds of which you are a shareholder. The amount you
designate, which can be expressed either in terms of a specific dollar or
share amount ($100 minimum), will be
Page 11
exchanged automatically on the first and/or fifteenth of the month according
to the schedule you have selected. Shares will be exchanged at the
then-current net asset value; however, a sales load may be charged with
respect to exchanges into funds sold with a sales load. See "Shareholder
Services" in the Statement of Additional Information. The right to exercise
this Privilege may be modified or canceled by the Fund or the Transfer Agent.
You may modify or cancel your exercise of this Privilege at any time by
mailing written notification to The Dreyfus Family of Funds, P.O. Box 9671,
Providence, Rhode Island 02940-9671. Each Fund may charge a service fee for
the use of this Privilege. No such fee currently is contemplated. For more
information concerning this Privilege and the funds in the Dreyfus Family of
Funds eligible to participate in this Privilege, or to obtain an Auto-Exchange
Authorization Form, please call toll free 1-800-645-6561. See "Dividends,
Distributions and Taxes."
DREYFUS-AUTOMATIC ASSET BUILDERRegistration Mark _ Dreyfus-AUTOMATIC Asset
Builder permits you to purchase Fund shares (minimum of $100 and maximum of
$150,000 per transaction) at regular intervals selected by you. Fund shares
are purchased by transferring funds from the bank account designated by you.
At your option, the bank account designated by you will be debited in the
specified amount, and Fund shares will be purchased, once a month, on either
the first or fifteenth day, or twice a month, on both days. Only an account
maintained at a domestic financial institution which is an Automated Clearing
House member may be so designated. To establish a Dreyfus-AUTOMATIC Asset
Builder account, you must file an authorization form with the Transfer Agent.
You may obtain the necessary authorization form from your Service Agent or by
calling 1-800-645-6561. You may cancel your participation in this Privilege
or change the amount of your purchase at any time by mailing written
notification to The Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode
Island 02940-9671, or, if for Dreyfus retirement plan accounts, to The
Dreyfus Trust Company, Custodian, P.O. Box 6427, Providence, Rhode Island
02940-6427, and the notification will be effective three business days
following receipt. Each Fund may modify or terminate this Privilege at any
time or charge a service fee. No such fee currently is contemplated.
GOVERNMENT DIRECT DEPOSIT PRIVILEGE _ The Government Direct Deposit
Privilege enables you to purchase Fund shares (minimum of $100 and maximum of
$50,000 per transaction) by having Federal salary, Social Security, or
certain veterans', military or other payments from the Federal government,
automatically deposited into your Fund account. You may deposit as much of
such payments as you elect. To enroll in Government Direct Deposit, you must
file with the Transfer Agent a completed Direct Deposit Sign-Up Form for each
type of payment that you desire to include in this Privilege. The appropriate
form may be obtained from your Service Agent or by calling 1-800-645-6561.
Death or legal incapacity will terminate your participation in this
Privilege. You may elect at any time to terminate your participation by
notifying in writing the appropriate Federal agency. Further, a Fund may
terminate your participation upon 30 days' notice to you.
PAYROLL SAVINGS PLAN _ The Payroll Savings Plan permits you to purchase Fund
shares (minimum of $100 per transaction) automatically on a regular basis.
Depending upon your employer's direct deposit program, you may have part or
all of your paycheck transferred to your existing Dreyfus account
electronically through the Automated Clearing House system at each pay
period. To establish a Payroll Savings Plan account, you must file an
authorization form with your employer's payroll department. Your employer
must complete the reverse side of the form and return it to The Dreyfus
Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. You may
obtain the necessary authorization form by calling 1-800-645-6561. You may
change the amount of purchase or cancel the autho-
Page 12
rization only by written notification to your employer. It is the sole
responsibility of your employer, not the Distributor, The Dreyfus Corporation,
the Fund, the Transfer Agent or any other person, to arrange for transactions
under the Payroll Savings Plan. Each Fund may modify or terminate this
Privilege at any time or charge a service fee. No such fee currently is
contemplated.
DIVIDEND OPTIONS _ Dividend Sweep enables you to invest automatically
dividends or dividends and capital gain distributions, if any, paid by a Fund
in shares of another fund in the Dreyfus Family of Funds of which you are a
shareholder. Shares of the other fund will be purchased at the then-current
net asset value; however, a sales load may be charged with respect to
investments in shares of a fund sold with a sales load. If you are investing
in a fund that charges a sales load, you may qualify for share prices which do
not include the sales load or which reflect a reduced sales load. If you are
investing in a fund that charges a contingent deferred sales charge, the
shares purchased will be subject on redemption to the contingent deferred
sales charge, if any, applicable to the purchased shares. See "Shareholder
Services" in the Statement of Additional Information. Dividend ACH permits
you to transfer electronically dividends or dividends and capital gain
distributions, if any, from a Fund to a designated bank account. Only an
account maintained at a domestic financial institution which is an Automated
Clearing House member may be so designated. Banks may charge a fee for this
service.
For more information concerning these privileges or to request a
Dividend Options Form, please call toll free 1-800-645-6561. You may cancel
these privileges by mailing written notification to The Dreyfus Family of
Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. Enrollment in or
cancellation of these privileges is effective three business days following
receipt. These privileges are available only for existing accounts and may
not be used to open new accounts. Minimum subsequent investments do not apply
for Dividend Sweep. Each Fund may modify or terminate these privileges at any
time or charge a service fee. No such fee currently is contemplated. Shares
held under Keogh Plans or IRAs are not eligible for Dividend Sweep.
QUARTERLY DISTRIBUTION PLAN _ The Quarterly Distribution Plan permits you to
receive quarterly payments from a Fund consisting of proceeds from the
redemption of shares purchased for your account through the automatic
reinvestment of dividends declared on your account during the preceding
calendar quarter. You may open a Quarterly Distribution Plan by submitting a
request to the Transfer Agent. The Quarterly Distribution Plan may be ended
at any time by you, the Fund or the Transfer Agent. Shares for which
certificates have been issued must be presented before redemption under the
Quarterly Distribution Plan.
AUTOMATIC WITHDRAWAL PLAN _ The Automatic Withdrawal Plan permits you to
request withdrawal of a specified dollar amount (minimum of $50) on either a
monthly or quarterly basis if you have a $5,000 minimum account. An
application for the Automatic Withdrawal Plan can be obtained by calling
1-800-645-6561. The Automatic Withdrawal Plan may be ended at any time by
you, the Fund or the Transfer Agent. Shares for which certificates have been
issued may not be redeemed through the Automatic Withdrawal Plan.
RETIREMENT PLANS _ Each Fund offers a variety of pension and profit-sharing
plans, including Keogh Plans, IRAs, SEP-IRAs and IRA "Rollover Accounts,"
401(k) Salary Reduction Plans and 403(b)(7) Plans. Plan support services also
are available. You can obtain details on the various plans by calling the
following numbers toll free: for Keogh Plans, please call 1-800-358-5566; for
IRAs and IRA "Rollover Accounts," please call 1-800-645-6561; or for SEP-IRAs,
401(k) Salary Reduction Plans and 403(b)(7) Plans, please call 1-800-322-7880.
Page 13
HOW TO REDEEM SHARES
GENERAL
You may request redemption of your shares at any time. Redemption
requests should be transmitted to the Transfer Agent as described below. When
a request is received in proper form, the Fund will redeem the shares at the
next determined net asset value.
Neither Fund imposes any charges when shares are redeemed. Service
Agents may charge their clients a fee for effecting redemptions of Fund
shares. Any certificates representing Fund shares being redeemed must be
submitted with the redemption request. The value of the shares redeemed may
be more or less than their original cost, depending upon the respective
Fund's then-current net asset value.
Each Fund ordinarily will make payment for all shares redeemed within
seven days after receipt by the Transfer Agent of a redemption request in
proper form, except as provided by the rules of the Securities and Exchange
Commission. HOWEVER, IF YOU HAVE PURCHASED FUND SHARES BY CHECK OR THROUGH
DREYFUS-AUTOMATIC ASSET BUILDERRegistration Mark AND SUBSEQUENTLY SUBMIT A
WRITTEN REDEMPTION REQUEST TO THE TRANSFER AGENT, YOUR REDEMPTION WILL BE
EFFECTIVE AND THE REDEMPTION PROCEEDS WILL BE TRANSMITTED TO YOU PROMPTLY
UPON BANK CLEARANCE OF YOUR PURCHASE CHECK OR DREYFUS-AUTOMATIC ASSET BUILDER
ORDER, WHICH MAY TAKE UP TO EIGHT BUSINESS DAYS OR MORE. IN ADDITION, EACH
FUND WILL NOT HONOR REDEMPTION CHECKS UNDER THE CHECK REDEMPTION PRIVILEGE,
AND WILL REJECT REQUESTS TO REDEEM SHARES BY WIRE OR TELEPHONE, FOR A PERIOD
OF EIGHT BUSINESS DAYS AFTER RECEIPT BY THE TRANSFER AGENT OF THE PURCHASE
CHECK OR THE DREYFUS-AUTOMATIC ASSET BUILDER ORDER AGAINST WHICH SUCH
REDEMPTION IS REQUESTED. THESE PROCEDURES WILL NOT APPLY IF YOUR SHARES WERE
PURCHASED BY WIRE PAYMENT, OR IF YOU OTHERWISE HAVE A SUFFICIENT COLLECTED
BALANCE IN YOUR ACCOUNT TO COVER THE REDEMPTION REQUEST. PRIOR TO THE TIME
ANY REDEMPTION IS EFFECTIVE, DIVIDENDS ON SUCH SHARES WILL ACCRUE AND BE
PAYABLE, AND YOU WILL BE ENTITLED TO EXERCISE ALL OTHER RIGHTS OF BENEFICIAL
OWNERSHIP. Fund shares will not be redeemed until the Transfer Agent has
received your Account Application.
The Fund reserves the right to redeem your account at its option upon
not less than 45 days' written notice if your account's net asset value is
$500 or less and remains so during the notice period.
PROCEDURES
You may redeem shares by using the regular redemption procedure
through the Transfer Agent, or through the Telephone Redemption Privilege
which is granted automatically unless you specifically refuse it by checking
the applicable "No" box on the Account Application. The Telephone Redemption
Privilege may be established for an existing account by a separate signed
Shareholder Services Form or by oral request from any of the authorized
signatories on the account by calling 1-800-645-6561. You also may redeem
shares through the Check Redemption Privilege, the Wire Redemption Privilege,
or the Dreyfus TELETRANSFER Privilege, if you have checked the appropriate
box and supplied the necessary information on the Account Application or have
filed a Shareholder Services Form with the Transfer Agent. If you are a
client of a Selected Dealer, you may redeem Fund shares through the Selected
Dealer. Other redemption procedures may be in effect for clients of certain
Service Agents. Each Fund makes available to certain large institutions the
ability to issue redemption instructions through compatible computer
facilities. Each Fund reserves the right to refuse any request made by wire
or telephone, including requests made shortly after a change of address, and
may limit the amount involved or the number of such requests. Each Fund may
modify or terminate any redemption Privilege at any time or
Page 14
charge a service fee upon notice to shareholders. No such fee currently is
contemplated. Shares held under Keogh Plans, IRAs or other retirement plans,
and shares for which certificates have been issued, are not eligible for the
Check Redemption, Wire Redemption or Telephone Redemption Privilege.
The Telephone Redemption Privilege and Telephone Exchange Privilege
authorizes the Transfer Agent to act on telephone instructions (including
over The Dreyfus TouchRegistration Mark automated telephone system) from any
person representing himself or herself to be you, or a representative of your
Service Agent, and reasonably believed by the Transfer Agent to be genuine.
Each Fund will require the Transfer Agent to employ reasonable procedures,
such as requiring a form of personal identification, to confirm that
instructions are genuine and, if it does not follow such procedures, the Fund
or the Transfer Agent may be liable for any losses due to unauthorized or
fraudulent instructions. Neither the Funds nor the Transfer Agent will be
liable for following telephone instructions reasonably believed to be
genuine.
During times of drastic economic or market conditions, you may
experience difficulty in contacting the Transfer Agent by telephone to
request a redemption or exchange of Fund shares. In such cases, you should
consider using the other redemption procedures described herein. Use of these
other redemption procedures may result in your redemption request being
processed at a later time than it would have been if telephone redemption had
been used.
REGULAR REDEMPTION _ Under the regular redemption procedure, you may redeem
shares by written request mailed to The Dreyfus Family of Funds, P.O. Box
9671, Providence, Rhode Island 02940-9671, or, if for Dreyfus retirement plan
accounts, to The Dreyfus Trust Company, Custodian, P.O. Box 6427, Providence,
Rhode Island 02940-6427. Redemption requests may be delivered in person only
to a Dreyfus Financial Center. For the location of the nearest Dreyfus
Financial Center, please call one of the telephone numbers listed under
"General Information." THESE REQUESTS WILL BE FORWARDED TO THE FUND AND WILL
BE PROCESSED ONLY UPON RECEIPT THEREBY. Redemption requests must be signed by
each shareholder, including each owner of a joint account, and each signature
must be guaranteed. The Transfer Agent has adopted standards and procedures
pursuant to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations, as well as from participants in the New York Stock
Exchange Medallion Signature Program, the Securities Transfer Agents
Medallion Program ("STAMP"), and the Stock Exchanges Medallion Program. If
you have questions with respect to signature-guarantees, please call one of
the telephone numbers listed under "General Information."
Redemption proceeds of at least $1,000 will be wired to any member
bank of the Federal Reserve System in accordance with a written
signature-guaranteed request.
CHECK REDEMPTION PRIVILEGE _ You may write Redemption Checks drawn on your
Fund account. Redemption Checks may be made payable to the order of any
person in the amount of $500 or more. Redemption Checks should not be used to
close your account. Redemption Checks are free, but the Transfer Agent will
impose a fee for stopping payment of a Redemption Check upon your request or
if the Transfer Agent cannot honor a Redemption Check due to insufficient
funds or other valid reason. You should date your Redemption Checks with the
current date when you write them. Please do not postdate your Redemption
Checks. If you do, the Transfer Agent will honor, upon presentment, even if
presented before the date of the check, all postdated Redemption Checks which
are dated within six months of presentment for payment, if they are otherwise
in good order. If you hold shares in a Dreyfus sponsored IRA account, you may
be permitted to make withdrawals from your IRA account using checks furnished
to you by The Dreyfus Trust Company.
Page 15
WIRE REDEMPTION PRIVILEGE _ You may request by wire or telephone that
redemption proceeds (minimum $1,000) be wired to your account at a bank which
is a member of the Federal Reserve System, or a correspondent bank if your
bank is not a member. Holders of jointly registered Fund or bank accounts may
have redemption proceeds of not more than $250,000 wired within any 30-day
period. You may telephone redemption requests by calling 1-800-645-6561 or,
if you are calling from overseas, call 516-794-5452. The Statement of
Additional Information sets forth instructions for transmitting redemption
requests by wire.
TELEPHONE REDEMPTION PRIVILEGE _ You may request by telephone that
redemption proceeds (maximum $150,000 per day) be paid by check and mailed to
your address. You may telephone redemption instructions by calling
1-800-645-6561 or, if you are calling from overseas, call 516-794-5452. The
Telephone Redemption Privilege is granted automatically unless you refuse it.
REDEMPTION THROUGH A SELECTED DEALER _ If you are a customer of a Selected
Dealer, you may make redemption requests to your Selected Dealer. If the
Selected Dealer transmits the redemption request so that it is received by
the Transfer Agent by 5:00 p.m., New York time, on a business day, the
proceeds of the redemption ordinarily will be transmitted in Federal Funds on
the same day and the shares will not receive the dividend declared on that
day. If a redemption request is received by the Transfer Agent after 5:00
p.m., New York time, but by 8:00 p.m., New York time, the redemption request
will be effective on that day, the shares will receive the dividend declared
on that day and the proceeds of redemption ordinarily will be transmitted in
Federal Funds on the next business day. It is the responsibility of the
Selected Dealer to transmit a request so that it is received in a timely
manner. The proceeds of the redemption are credited to your account with the
Selected Dealer.
SERVICE PLAN
Class A shares of each Fund are subject to a separate Service Plan
adopted pursuant to Rule 12b-1 under the 1940 Act. Under each Service Plan,
the Fund directly bears the costs of preparing, printing and distributing
prospectuses and statements of additional information and of implementing and
operating the Service Plan. In addition, each Fund reimburses (a) the
Distributor for payments made for distributing Class A shares and servicing
shareholder accounts ("Servicing") and (b) The Dreyfus Corporation, Dreyfus
Service Corporation, a wholly-owned subsidiary of The Dreyfus Corporation,
and any affiliate of either of them (collectively, "Dreyfus") for payments
made for Servicing, at an aggregate annual rate of up to .20 of 1% of the
value of the Fund's average daily net assets attributable to Class A. Each of
the Distributor and Dreyfus may pay one or more Service Agents a fee in
respect of the respective Fund's Class A shares owned by shareholders with
whom the Service Agent has a Servicing relationship or for whom the Service
Agent is the dealer or holder of record. The schedule of such fees and the
basis upon which such fees will be paid shall be determined from time to time
by the Fund's Board as to each Fund. If a holder of Class A shares ceases to
be a client of a Service Agent, but continues to hold Class A shares, Dreyfus
will act as a Service Agent in respect of such Fund shareholders and receive
payments under the Service Plan for Servicing. The fees payable for Servicing
are payable without regard to actual expenses incurred.
SHAREHOLDER SERVICES PLAN
Each Fund has adopted a separate Shareholder Services Plan with
respect to Class A pursuant to which the Fund reimburses Dreyfus Service
Corporation an amount not to exceed an annual rate of .25 of 1% of the value
of the Fund's average daily net assets attributable to Class A for certain
allocated
Page 16
expenses of providing personal services and/or maintaining shareholder
accounts. At no time, however, will the amount paid under this Plan, together
with amounts otherwise paid with respect to Class A under such Fund's Service
Plan as a "service fee" as defined in the NASD Conduct Rules, exceed the
maximum amount permitted to be paid under the NASD Conduct Rules
as a service fee. The services provided may include personal services
relating to shareholder accounts, such as answering shareholder inquiries
regarding the Fund and providing reports and other information, and services
related to the maintenance of shareholder accounts.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Each Fund ordinarily declares dividends from its net investment
income on each day the New York Stock Exchange or, for the Money Fund only,
the Transfer Agent is open for business. The Fund's earnings for Saturdays,
Sundays and holidays are declared as dividends on the preceding business day.
Dividends usually are paid on the last calendar day of each month and
automatically are reinvested in additional shares at net asset value or, at
your option, paid in cash. If you redeem all shares in your account at any
time during the month, all dividends to which you are entitled will be paid
to you along with the proceeds of the redemption. If you are an omnibus
accountholder and indicate in a partial redemption request that a portion of
any accrued dividends to which such account is entitled belongs to an
underlying accountholder who has redeemed all shares in his or her account,
such portion of the accrued dividends will be paid to you along with the
proceeds of the redemption. Distributions from net realized securities gains,
if any, generally are declared and paid once a year, but each Fund may make
distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code of 1986, as amended (the "Code"),
in all events in a manner consistent with the provisions of the 1940 Act. No
Fund will make distributions from net realized securities gains unless
capital loss carryovers, if any, have been utilized or have expired. You may
choose whether to receive distributions in cash or to reinvest in additional
shares at net asset value. All expenses are accrued daily and deducted before
declaration of dividends to investors. Dividends paid by each class will be
calculated at the same time and in the same manner and will be in the same
amount, except that the expenses attributable solely to a class will be borne
exclusively by such class.
Dividends paid by each Fund derived from interest, together with
distributions from any net realized short-term securities gains and all or a
portion of any gains realized from the sale or other disposition of certain
market discount bonds, are subject to Federal income tax as ordinary income,
whether received in cash or reinvested in additional Fund shares.
Distributions from net realized long-term securities gains, if any, will be
taxable as long-term capital gains for Federal income tax purposes if you are
a citizen or resident of the United States. The Code provides that the net
capital gain of an individual generally will not be subject to Federal income
tax at a rate in excess of 28%. Dividends and distributions may be subject to
state and local taxes.
Dividends and distributions attributable to interest from direct
obligations of the United States and paid by each Fund to individuals
currently are not subject to tax in most states. Dividends and distributions
attributable to interest from other securities in which each Fund may invest
may be subject to state tax. Each Fund intends to provide shareholders with a
statement which sets forth the percentage of dividends and distributions paid
by the Fund that is attributable to interest income from direct obligations
of the United States.
Dividends derived from net investment income, together with
distributions from net realized short-term securities gains and all or a
portion of any gains realized from the sale or other disposition of certain
market
Page 17
discount bonds, paid by each Fund to a foreign investor generally are
subject to U.S. nonresident withholding taxes at the rate of 30%, unless the
foreign investor claims the benefit of a lower rate specified in a tax
treaty. Distributions from net realized long-term securities gains paid by a
Fund to a foreign investor generally will not be subject to U.S. nonresident
withholding tax. However, such distributions may be subject to backup
withholding, as described below, unless the foreign investor certifies his
non-U.S. residency status.
Notice as to the tax status of your dividends and distributions will
be mailed to you annually. You also will receive periodic summaries of your
account which will include information as to dividends and distributions from
securities gains, if any, paid during the year. No dividends will qualify for
the dividend received deduction allowable to certain U.S. corporations.
The exchange of shares of one fund for shares of another is treated
for Federal income tax purposes as a sale of the shares given in exchange by
the shareholder and, therefore, an exchanging shareholder may realize a
taxable gain or loss.
Federal regulations generally require each Fund to withhold ("backup
withholding") and remit to the U.S. Treasury 31% of dividends and
distributions from net realized securities gains of the Fund paid to a
shareholder if such shareholder fails to certify either that the TIN
furnished in connection with opening an account is correct, or that such
shareholder has not received notice from the IRS of being subject to backup
withholding as a result of a failure to properly report taxable dividend or
interest income on a Federal income tax return. Furthermore, the IRS may
notify a Fund to institute backup withholding if the IRS determines a
shareholder's TIN is incorrect or if a shareholder has failed to properly
report taxable dividend and interest income on a Federal income tax return.
A TIN is either the Social Security number or employer identification
number of the record owner of the account. Any tax withheld as a result of
backup withholding does not constitute an additional tax imposed on the
record owner of the account, and may be claimed as a credit on the record
owner's Federal income tax return.
Management believes that each Fund has qualified for the fiscal year
ended January 31, 1997 as a "regulated investment company" under the Code.
Each Fund intends to continue to so qualify if such qualification is in the
best interests of its shareholders. Such qualification relieves the Fund of
any liability for Federal income tax to the extent its earnings are
distributed in accordance with applicable provisions of the Code. Each Fund
is subject to a non-deductible 4% excise tax, measured with respect to
certain undistributed amounts of taxable investment income and capital gains.
You should consult your tax adviser regarding specific questions as
to Federal, state and local taxes.
GENERAL INFORMATION
The Government Fund and the Money Fund were incorporated under
Maryland law on April 8, 1982, and May 15, 1981, respectively, and commenced
operations on February 7, 1983 and February 8, 1982, respectively. Each Fund
is authorized to issue 15 billion shares of Class A Common Stock and one
billion shares of Class B Common Stock, par value $.01 per share. Each Fund's
shares are classified into two classes_Class A and Class B. Each share has
one vote and shareholders will vote in the aggregate and not by class except
as otherwise required by law.
Unless otherwise required by the 1940 Act, ordinarily it will not be
necessary for either Fund to hold annual meetings of shareholders. As a
result, Fund shareholders may not consider each year the election of Board
members or the appointment of auditors. However, pursuant to each Fund's
By-Laws, the holders of at least 10% of the shares outstanding and entitled
to vote may require such Fund to hold a special meeting of shareholders for
purposes of removing a Board member from office and the
Page 18
holders of at least 25% of such shares may require such Fund to hold a special
meeting of shareholders for any other purpose. Fund shareholders may remove a
Board member by the affirmative vote of a majority of the relevant Fund's
outstanding voting shares. In addition, a Fund's Board will call a special
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 Transfer Agent maintains a record of your ownership and sends
confirmations and statements of account.
Shareholder inquiries may be made to your Service Agent or by writing
to a Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144, or
by calling toll free 1-800-242-8671. In New York City, call 1-718-895-1396;
outside the U.S., call 516-794-5452.
Although each Fund is offering only its own shares, it is possible
that a Fund might become liable for any misstatement in this Prospectus about
the other Fund. Each Fund's Board has considered this factor in approving the
use of this combined Prospectus.
Page 19
APPENDIX
INVESTMENT TECHNIQUES
BORROWING _ Each Fund may borrow money from banks for temporary or emergency
(not leveraging) purposes in an amount up to 15% of the value of its total
assets (including the amount borrowed) valued at the lesser of cost or
market, less liabilities (not including the amount borrowed) at the time the
borrowing is made. While borrowings exceed 5% of the value of a Fund's total
assets, such Fund will not make any additional investments.
CERTAIN PORTFOLIO SECURITIES
U.S. GOVERNMENT SECURITIES _ Securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities include U.S. Treasury
securities, which differ in their interest rates, maturities and times of
issuance. Some obligations issued or guaranteed by U.S. Government agencies
and instrumentalities are supported by the full faith and credit of the U.S.
Treasury; others by the right of the issuer to borrow from the Treasury;
others by discretionary authority of the U.S. Government to purchase certain
obligations of the agency or instrumentality; and others only by the credit
of the agency or instrumentality. These securities bear fixed, floating or
variable rates of interest. Interest may fluctuate based on generally
reorganized reference rates or the relationship of rates. While the U.S.
Government currently provides financial support to such U.S.
Government-sponsored agencies or instrumentalities, no assurance can be given
that it will always do so, since it is not so obligated by law.
REPURCHASE AGREEMENTS _ In a repurchase agreement, a Fund buys, and the
seller agrees to repurchase, a security at a mutually agreed upon time and
price (usually within seven days). The repurchase agreement thereby
determines the yield during the purchaser's holding period, while the
seller's obligation to repurchase is secured by the value of the underlying
security. Repurchase agreements could involve risks in the event of a default
or insolvency of the other party to the agreement, including possible delays
or restrictions upon the Fund's ability to dispose of the underlying
securities. Each Fund may enter into repurchase agreements with certain banks
or non-bank dealers.
ILLIQUID SECURITIES _ Each Fund may invest up to 10% 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 Fund's investment
objective. Such securities may include securities that are not readily
marketable, such as certain securities that are subject to legal or
contractual restrictions on resale, and repurchase agreements providing for
settlement in more than seven days after notice. As to these securities, the
Fund is subject to a risk that should the Fund desire to sell them when a
ready buyer is not available at a price the Fund deems representative of
their value, the value of the Fund's net assets could be adversely affected.
BANK OBLIGATIONS (MONEY FUND ONLY) _ The Fund may purchase certificates of
deposit, time deposits, bankers' acceptances and other short-term obligations
issued by domestic banks, foreign subsidiaries or foreign branches of
domestic banks, domestic and foreign branches of foreign banks, and thrift
institutions, savings and loan associations and other banking institutions.
With respect to such securities issued by foreign subsidiaries or foreign
branches of domestic banks, and domestic and foreign branches of foreign
banks, the Fund may be subject to additional investment risks that are
different in some respects from those incurred by a fund which invests only
in debt obligations of U.S. domestic issuers. See "Description of the Funds
_ Investment Considerations and Risks _ Foreign Securities."
Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified period
of time.
Page 20
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time (in no event longer than seven
days) at a stated interest rate.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments reflect
the obligation both of the bank and the drawer to pay the face amount of the
instrument upon maturity. The other short-term obligations may include
uninsured, direct obligations bearing fixed, floating or variable interest
rates.
COMMERCIAL PAPER (MONEY FUND ONLY) _ Commercial paper consists of
short-term, unsecured promissory notes issued to finance short-term credit
needs. The commercial paper purchased by the Fund will consist only of direct
obligations issued by domestic and foreign entities. The other corporate
obligations in which the Fund may invest consist of high quality, U.S. dollar
denominated short-term bonds and notes (including variable amount master
demand notes) issued by domestic and foreign corporations, including banks.
FLOATING AND VARIABLE RATE OBLIGATIONS (MONEY FUND ONLY) _ The Fund may
purchase floating and variable rate demand notes and bonds, which are
obligations ordinarily having stated maturities in excess of 13 months, but
which permit the holder to demand payment of principal at any time, or at
specified intervals not exceeding 13 months, in each case upon not more than
30 days' notice. Variable rate demand notes include master demand notes which
are obligations that permit the Fund to invest fluctuating amounts, at
varying rates of interest, pursuant to direct arrangements between the Fund,
as lender, and the borrower. These obligations permit daily changes in the
amounts borrowed. Because these obligations are direct lending arrangements
between the lender and borrower, it is not contemplated that such instruments
generally will be traded, and there generally is no established secondary
market for these obligations, although they are redeemable at face value,
plus accrued interest. Accordingly, where these obligations are not secured
by letters of credit or other credit support arrangements, the Fund's right
to redeem is dependent on the ability of the borrower to pay principal and
interest on demand.
PARTICIPATION INTERESTS (MONEY FUND ONLY) _ The Fund may purchase from
financial institutions participation interests in securities in which the
Fund may invest. A participation interest gives the Fund an undivided
interest in the security in the proportion that the Fund's participation
interest bears to the total principal amount of the security. These
instruments may have fixed, floating or variable rates of interest, with
remaining maturities of 13 months or less. If the participation interest is
unrated, or has been given a rating below that which is permissible for
purchase by the Fund, the participation interest will be backed by an
irrevocable letter of credit or guarantee of a bank, or the payment
obligation otherwise will be collateralized by U.S. Government securities,
or, in the case of unrated participation interests, The Dreyfus Corporation
must have determined that the instrument is of comparable quality to those
instruments in which the Fund may invest.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND IN THE
FUND'S OFFICIAL SALES LITERATURE IN CONNECTION WITH THE OFFER OF THE FUND'S
SHARES, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH, OR TO ANY PERSON TO WHOM,
SUCH OFFERING MAY NOT LAWFULLY BE MADE.
Page 21
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Page 22
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Page 23
General
Government Securities
Money Market Fund, Inc.
General
Money Market Fund, Inc.
Combined Prospectus
CLASS A SHARES
- ------------------------------------------------------------------------------
COMBINED PROSPECTUS June 1, 1997
As Revised August 25, 1997
GENERAL MONEY MARKET FUND, INC.
GENERAL GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
CLASS B SHARES
- ------------------------------------------------------------------------------
GENERAL GOVERNMENT SECURITIES MONEY MARKET FUND, INC. AND GENERAL
MONEY MARKET FUND, INC. (EACH, A "FUND" AND COLLECTIVELY, THE "FUNDS") ARE
OPEN-END, DIVERSIFIED, MANAGEMENT INVESTMENT COMPANIES, KNOWN AS MONEY MARKET
MUTUAL FUNDS. EACH FUND'S INVESTMENT OBJECTIVE IS TO PROVIDE YOU WITH AS HIGH
A LEVEL OF CURRENT INCOME AS IS CONSISTENT WITH THE PRESERVATION OF CAPITAL
AND, IN THE CASE OF GENERAL GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
ONLY, THE MAINTENANCE OF LIQUIDITY.
YOU CAN INVEST, REINVEST OR REDEEM SHARES AT ANY TIME WITHOUT CHARGE
OR PENALTY IMPOSED BY A FUND.
THE DREYFUS CORPORATION PROFESSIONALLY MANAGES EACH FUND'S PORTFOLIO.
EACH FUND'S SHARES MAY BE PURCHASED ONLY BY CLIENTS OF SERVICE AGENTS
AS DESCRIBED HEREIN. BY THIS PROSPECTUS, EACH FUND IS OFFERING CLASS B
SHARES. CLASS A SHARES ARE OFFERED BY THE FUNDS PURSUANT TO A SEPARATE
PROSPECTUS AND ARE NOT OFFERED HEREBY. THE CLASSES ARE IDENTICAL, EXCEPT AS
TO THE SERVICES OFFERED TO AND THE EXPENSES BORNE BY EACH CLASS WHICH MAY
AFFECT PERFORMANCE. IF YOU WOULD LIKE TO OBTAIN INFORMATION ABOUT CLASS A
SHARES, PLEASE WRITE TO THE ADDRESS OR CALL THE NUMBER SET FORTH BELOW.
AN INVESTMENT IN THE FUNDS IS NEITHER INSURED NOR GUARANTEED BY THE
U.S. GOVERNMENT. THERE CAN BE NO ASSURANCE THAT THE FUNDS WILL BE ABLE TO
MAINTAIN A STABLE NET ASSET VALUE OF $1.00 PER SHARE.
GENERAL GOVERNMENT SECURITIES MONEY MARKET FUND, INC. (the "Government Money
Fund") invests in U.S. Government securities and repurchase agreements in
respect of U.S. Government securities.
GENERAL MONEY MARKET FUND, INC. (the "Money Fund") invests in short-term
money market obligations including U.S. Government securities, certificates
of deposit and other domestic and foreign bank obligations, repurchase
agreements, commercial paper, and other short-term corporate obligations, as
more fully described herein.
Each Fund is a separate entity with a separate portfolio. The
operations and results of one Fund are unrelated to those of the other Fund.
This combined Prospectus has been prepared for your convenience to provide
you the opportunity to consider two investment choices in one document.
THIS PROSPECTUS SETS FORTH CONCISELY INFORMATION ABOUT EACH FUND THAT
YOU SHOULD KNOW BEFORE INVESTING. IT SHOULD BE READ AND RETAINED FOR FUTURE
REFERENCE.
A STATEMENT OF ADDITIONAL INFORMATION, DATED JUNE 1, 1997, WHICH MAY
BE REVISED FROM TIME TO TIME, PROVIDES A FURTHER DISCUSSION OF CERTAIN AREAS
IN THIS PROSPECTUS AND OTHER MATTERS WHICH MAY BE OF INTEREST TO SOME
INVESTORS. IT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AND
IS INCORPORATED HEREIN BY REFERENCE. THE SECURITIES AND EXCHANGE COMMISSION
MAINTAINS A WEB SITE (HTTP://WWW.SEC.GOV) THAT CONTAINS THE STATEMENT OF
ADDITIONAL INFORMATION, MATERIAL INCORPORATED BY REFERENCE, AND OTHER
INFORMATION REGARDING THE FUNDS. FOR A FREE COPY OF THE STATEMENT OF
ADDITIONAL INFORMATION, WRITE TO A FUND AT 144 GLENN CURTISS BOULEVARD,
UNIONDALE, NEW YORK 11556-0144, OR CALL 1-800-645-6561. WHEN TELEPHONING, ASK
FOR OPERATOR 144.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
AGENCY. MONEY MARKET MUTUAL FUND SHARES INVOLVE CERTAIN INVESTMENT RISKS,
INCLUDING THE POSSIBLE LOSS OF PRINCIPAL.
- ------------------------------------------------------------------------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
- ------------------------------------------------------------------------------
TABLE OF CONTENTS
Page
Annual Fund Operating Expenses........................... 3
Condensed Financial Information.......................... 4
Yield Information........................................ 5
Description of the Funds................................. 5
Management of the Funds.................................. 7
How to Buy Shares........................................ 8
Shareholder Services..................................... 10
How to Redeem Shares..................................... 14
Distribution Plan........................................ 16
Shareholder Services Plan................................ 16
Dividends, Distributions and Taxes....................... 16
General Information...................................... 18
Appendix................................................. 20
2
<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)
GOVERNMENT
MONEY MONEY
FUND FUND
--------- ----
<S> <C> <C>
Management Fees...... ............................................ .50% .50%
12b-1 Fees.... ................................................... .20% .20%
Other Expenses.... ............................................... .38% .37%
Total Fund Operating Expenses..... ............................... 1.08% 1.07%
</TABLE>
EXAMPLE:
You would pay the following expenses on
a $1,000 investment, assuming (1) 5% annual
return and (2) redemption at the end of
each time period:
1 YEAR $ 11 $ 11
3 YEARS $ 34 $ 34
5 YEARS $ 60 $ 59
10 YEARS $132 $131
- ------------------------------------------------------------------------------
THE AMOUNTS LISTED IN THE EXAMPLE SHOULD NOT BE CONSIDERED AS
REPRESENTATIVE OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER
OR LESS THAN THOSE INDICATED. MOREOVER, WHILE THE EXAMPLE ASSUMES A 5% ANNUAL
RETURN, EACH FUND'S ACTUAL PERFORMANCE WILL VARY AND MAY RESULT IN AN ACTUAL
RETURN GREATER OR LESS THAN 5%.
- ------------------------------------------------------------------------------
The purpose of the foregoing table is to assist you in understanding
the costs and expenses borne by each Fund, the payment of which will reduce
investors' annual return. The information in the foregoing table does not
reflect any fee waivers or expense reimbursement arrangements that may be in
effect. Each Fund's Class B shares are charged directly for sub-accounting
services provided by Service Agents (as defined below) at the annual rate of
.05% of the value of the Fund's average daily net assets attributable to
Class B, which is reflected under "Other Expenses" in the foregoing table.
Certain Service Agents may charge their clients direct fees for effecting
transactions in Fund shares; such fees are not reflected in the foregoing
table. See "Management of the Funds," "How to Buy Shares," Distribution Plan"
and "Shareholder Services Plan."
3
CONDENSED FINANCIAL INFORMATION
The information in the following tables has been audited by Ernst &
Young LLP, each Fund's independent auditors. Further financial data, related
notes and report of independent auditors accompany the Statement of
Additional Information, available upon request.
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
GOVERNMENT MONEY FUND _ Contained below is per share operating performance
data for a Class B share of Common Stock outstanding, total investment
return, ratios to average net assets and other supplemental data for each
year indicated. This information has been derived from the Government Money
Fund's financial statements.
Government Money Fund
YEAR ENDED JANUARY 31,
---------------------
1996(1) 1997
------ ----
PER SHARE DATA:
<S> <C> <C>
Net asset value, beginning of year........................................ $1.00 $1.00
----- -----
INVESTMENT OPERATIONS:
Investment income-net..................................................... .042 .045
----- -----
DISTRIBUTIONS:
Dividends from investment income-net...................................... (.042) (.045)
------ ------
Net asset value, end of year.............................................. $1.00 $1.00
====== ======
TOTAL INVESTMENT RETURN................................................... 5.04%(2) 4.58%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets................................... 1.00%(2) 1.00%
Ratio of net investment income to average net assets...................... 5.01%(2) 4.48%
Decrease reflected in above expense ratios
due to undertakings by The Dreyfus Corporation .10%(2) .08%
Net Assets, end of period (000's omitted)................................. $58 $90,175
</TABLE>
(1) From March 31, 1995 (commencement of initial offering) to January 31, 1996.
(2) Annualized.
<TABLE>
<CAPTION>
MONEY FUND _ Contained below is per share operating performance data for a
Class B share of Common Stock outstanding, total investment return, ratios
to average net assets and other supplemental data for each year indicated.
This information has been derived from the Money Fund's financial statements.
MONEY FUND
YEAR ENDED JANUARY 31,
-----------------------
1996(1) 1997
------ ------
PER SHARE DATA:
<S> <C> <C>
Net asset value, beginning of year........................................ $1.00 $1.00
----- -----
INVESTMENT OPERATIONS:
Investment income-net .................................................... .043 .046
----- -----
DISTRIBUTIONS:
Dividends from investment income-net...................................... (.043) (.046)
------ ------
Net asset value, end of year.............................................. $1.00 $1.00
====== ======
TOTAL INVESTMENT RETURN..................................................... 5.18%(2) 4.65%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets .................................. 1.00%(2) 1.00%
Ratio of net investment income to average net assets ..................... 5.00%(2) 4.56%
Decrease reflected in above expense ratio due to
undertaking by The Dreyfus Corporation.................................... .07%(2) .07%
Net Assets, end of year(000's omitted).................................... $50,446 $369,205
</TABLE>
(1) From March 31, 1995 (commencement of initial offering) to January 31, 1996.
(2) Annualized.
4
YIELD INFORMATION
From time to time, each Fund advertises its yield and effective
yield. Both yield figures are based on historical earnings and are not
intended to indicate future performance. It can be expected that these yields
will fluctuate substantially. The yield of a Fund refers to the income
generated by an investment in the Fund over a seven-day period (which period
will be stated in the advertisement). This income is then "annualized." That
is, the amount of income generated by the investment during that week is
assumed to be generated each week over a 52-week period and is shown as a
percentage of the investment. The effective yield is calculated similarly,
but, when annualized, the income earned by an investment in the Fund is
assumed to be reinvested. The effective yield will be slightly higher than
the yield because of the compounding effect of this assumed reinvestment. A
Fund's yield and effective yield may reflect absorbed expenses pursuant to
any undertaking that may be in effect. See "Management of the Funds."
Yield information is useful in reviewing a Fund's performance, but
because yields will fluctuate, under certain conditions such information may
not provide a basis for comparison with domestic bank deposits, other
investments which pay a fixed yield for a stated period of time, or other
investment companies which may use a different method of computing yield.
Comparative performance information may be used from time to time in
advertising or marketing Fund shares, including data from Lipper Analytical
Services, Inc., Bank Rate Monitortrademark, N. Palm Beach, Fla. 33408, IBC's
Money Fund ReportTM, Morningstar, Inc. and other industry publications.
DESCRIPTION OF THE FUNDS
INVESTMENT OBJECTIVE
The investment objective of each Fund is to provide you with as high
a level of current income as is consistent with the preservation of capital
and, in the case of the Government Money Fund only, the maintenance of
liquidity. Each Fund's investment objective cannot be changed without
approval by the holders of a majority (as defined in the Investment Company
Act of 1940, as amended (the "1940 Act")) of such Fund's outstanding voting
shares. There can be no assurance that a Fund's investment objective will be
achieved. Each Fund pursues its investment objective in the manner described
below. Securities in which a Fund invests may not earn as high a level of
current income as long-term or lower quality securities which generally have
less liquidity, greater market risk and more fluctuation in market value.
MANAGEMENT POLICIES
Each Fund seeks to maintain a net asset value of $1.00 per share for
purchases and redemptions. To do so, each Fund uses the amortized cost method
of valuing its securities pursuant to Rule 2a-7 under the 1940 Act, which
Rule includes various maturity, quality and diversification requirements,
certain of which are summarized as follows. In accordance with Rule 2a-7,
each Fund is required to maintain a dollar-weighted average portfolio
maturity of 90 days or less, purchase only instruments having remaining
maturities of 13 months or less and invest only in U.S. dollar denominated
securities determined in accordance with procedures established by the Fund's
Board to present minimal credit risks and, in the case of the Money Fund,
which are rated in one of the two highest rating categories for debt
obligations by at least two nationally recognized statistical rating
organizations (or one rating organization if the instrument was rated by only
one such organization) or, if unrated, are of comparable quality as
determined in accordance with procedures established by the Money Fund's
Board. The nationally recognized statistical rating organizations currently
rating instruments of the type the Money Fund may
5
purchase are Moody's Investors Service, Inc., Standard & Poor's Ratings
Group, Duff & Phelps Credit Rating Co., Fitch Investors Service, L.P., IBCA
Limited and IBCA Inc. and Thomson BankWatch, Inc. and their rating criteria
are described in the "Appendix" to the Statement of Additional Information.
This discussion concerning investment ratings does not apply to the Government
Money Fund because it invests exclusively in U.S. Government securities and
repurchase agreements in respect thereof. For further information regarding
the amortized cost method of valuing securities, see "Determination of Net
Asset Value" in the Statement of Additional Information. There can be no
assurance that either Fund will be able to maintain a stable net asset value
of $1.00 per share.
GOVERNMENT FUND _ The Fund invests in securities issued or guaranteed as to
principal and interest by the U.S. Government or its agencies or
instrumentalities, and repurchase agreements in respect of such securities.
See "Appendix _ Certain Portfolio Securities."
MONEY FUND _ The Fund invests in short-term money market obligations,
including securities issued or guaranteed by the U.S. Government or its
agencies or instrumentalities, time deposits, certificates of deposit,
bankers' acceptances and other short-term obligations issued by domestic
banks, foreign subsidiaries or foreign branches of domestic banks, domestic
and foreign branches of foreign banks and thrift institutions, repurchase
agreements, asset-backed securities, and high quality domestic and foreign
commercial paper and other short-term corporate obligations, including those
with floating or variable rates of interest. The Fund may invest in U.S.
dollar denominated obligations issued or guaranteed by one or more foreign
governments or any of their political subdivisions, agencies or
instrumentalities, including obligations of supranational entities. See
"Appendix _ Certain Portfolio Securities." During normal market conditions,
at least 25% of the value of the Fund's total assets will be invested in bank
obligations. See "Investment Considerations and Risks" below.
INVESTMENT CONSIDERATIONS AND RISKS
GENERAL _ Each Fund attempts to increase yields by trading to take advantage
of short-term market variations. This policy is expected to result in high
portfolio turnover but should not adversely affect a Fund since each Fund
usually does not pay brokerage commissions when it purchases short-term debt
obligations, including U.S. Government securities. The value of the portfolio
securities held by each Fund will vary inversely to changes in prevailing
interest rates. Thus, if interest rates have increased from the time a
security was purchased, such security, if sold, might be sold at a price less
than its cost. Similarly, if interest rates have declined from the time a
security was purchased, such security, if sold, might be sold at a price
greater than its purchase cost. In either instance, if the security was
purchased at face value and held to maturity, no gain or loss would be
realized.
FOREIGN SECURITIES (MONEY FUND ONLY) _ Since the Fund's portfolio may
contain securities issued by foreign governments, or any of their political
subdivisions, agencies or instrumentalities, and by foreign subsidiaries and
foreign branches of domestic banks, domestic and foreign branches of foreign
banks, and commercial paper issued by foreign issuers, the Fund may be
subject to additional investment risks with respect to those securities that
are different in some respects from those incurred by a fund which invests
only in debt obligations of U.S. domestic issuers, although such obligations
may be higher yielding when compared to the securities of U.S. domestic
issuers. Such risks include possible future political and economic
developments, seizure or nationalization of foreign deposits, imposition of
foreign withholding taxes on interest income payable on the securities,
establishment of exchange controls or adoption of other foreign governmental
restrictions which might adversely affect the payment of principal and
interest on these securities.
6
BANK SECURITIES (MONEY FUND ONLY) _ To the extent the Fund's investments are
concentrated in the banking industry, the Fund will have correspondingly
greater exposure to the risk factors which are characteristic of such
investments. Sustained increases in interest rates can adversely affect the
availability or liquidity and cost of capital funds for a bank's lending
activities, and a deterioration in general economic conditions could increase
the exposure to credit losses. In addition, the value of and the investment
return on the Fund's shares could be affected by economic or regulatory
developments in or related to the banking industry, which industry also is
subject to the effects of competition within the banking industry as well as
with other types of financial institutions. The Fund, however, will seek to
minimize its exposure to such risks by investing only in debt securities
which are determined to be of high quality.
SIMULTANEOUS INVESTMENTS _ Investment decisions for each Fund are made
independently from those of other investment companies advised by The Dreyfus
Corporation. If, however, such other investment companies desire to invest
in, or dispose of, the same securities as a Fund, available investments or
opportunities for sales will be allocated equitably to each investment
company. In some cases, this procedure may adversely affect the size of the
position obtained for or disposed of by the Fund or the price paid or
received by the Fund.
MANAGEMENT OF THE FUNDS
INVESTMENT ADVISER _ The Dreyfus Corporation, located at 200 Park Avenue,
New York, New York 10166, was formed in 1947 and serves as each Fund's
investment adviser. The Dreyfus Corporation is a wholly-owned subsidiary of
Mellon Bank, N.A., which is a wholly-owned subsidiary of Mellon Bank
Corporation ("Mellon"). As of April 30, 1997, The Dreyfus Corporation managed
or administered approximately $83 billion in assets for approximately 1.7
million investor accounts nationwide.
The Dreyfus Corporation supervises and assists in the overall
management of each Fund's affairs under a separate Management Agreement with
the Fund, subject to the authority of the Fund's Board in accordance with
Maryland law.
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. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCO Credit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries, including The Dreyfus Corporation, Mellon managed more than
$259 billion in assets as of March 31, 1997, including approximately $88
billion in proprietary mutual fund assets. As of March 31, 1997, Mellon,
through various subsidiaries, provided non-investment services, such as
custodial or administration services, for more than $1.061 trillion in
assets, including approximately $58 billion in mutual fund assets.
For each Fund's fiscal year ended January 31, 1997, each Fund paid
The Dreyfus Corporation a monthly management fee at the annual rate of .50 of
1% of the value of such Fund's average daily net assets. From time to time,
The Dreyfus Corporation may waive receipt of its fees and/or voluntarily
assume certain expenses of a Fund, which would have the effect of lowering
the expense ratio of such Fund and increasing yield to investors. Neither
Fund will pay The Dreyfus Corporation at a later time for any amounts it may
waive, nor will either Fund reimburse The Dreyfus Corporation for any amounts
it may assume.
7
In allocating brokerage transactions, The Dreyfus Corporation seeks
to obtain the best execution of orders at the most favorable net price.
Subject to this determination, The Dreyfus Corporation may consider, among
other things, the receipt of research services and/or the sale of shares of a
Fund or other funds managed, advised or administered by The Dreyfus
Corporation as factors in the selection of broker-dealers to execute
portfolio transactions for the Fund. See "Portfolio Transactions" in the State
ment of Additional Information.
The Dreyfus Corporation may pay the Funds' distributor for
shareholder services from The Dreyfus Corporation's own assets, including
past profits but not including the management fee paid by the Fund. The
Funds' distributor may use part or all of such payments to pay Service Agents
in respect of these services.
DISTRIBUTOR _ The Funds' distributor is Premier Mutual Fund Services, Inc.
(the "Distributor"), located at 60 State Street, Boston, Massachusetts 02109.
The Distributor's ultimate parent is Boston Institutional Group, Inc.
TRANSFER AND DIVIDEND DISBURSING AGENT AND CUSTODIAN _ Dreyfus Transfer,
Inc., a wholly-owned subsidiary of The Dreyfus Corporation, P.O. Box 9671,
Providence, Rhode Island 02940-9671, is each Fund's Transfer and Dividend
Disbursing Agent (the "Transfer Agent"). The Bank of New York, 90 Washington
Street, New York, New York 10286, is each Fund's Custodian.
HOW TO BUY SHARES
Each Fund's shares may be purchased only by clients of certain
financial institutions (which may include banks), securities dealers
("Selected Dealers"), and other industry professionals such as investment
advisers, accountants and estate planning firms (collectively, "Service
Agents") that have entered into service agreements with the Distributor. For
shareholders who purchase Fund shares from the Distributor, the Distributor
will act as Service Agent. Stock certificates are issued only upon your
written request. No certificates are issued for fractional shares. Each Fund
reserves the right to reject any purchase order.
The minimum initial investment in each Fund is $2,500, or $1,000 if
you are a client of a Service Agent which maintains an omnibus account in the
Fund and has made an aggregate minimum initial purchase in the Fund for its
customers of $2,500. Subsequent investments must be at least $100. The
initial investment must be accompanied by the Account Application. For
full-time or part-time employees of The Dreyfus Corporation or any of its
affiliates or subsidiaries, directors of The Dreyfus Corporation, Board
members of a fund advised by The Dreyfus Corporation, including members of
each Fund's Board, or the spouse or minor child of any of the foregoing, the
minimum initial investment is $1,000. For full-time or part-time employees of
The Dreyfus Corporation or any of its affiliates or subsidiaries who elect to
have a portion of their pay directly deposited into their Fund accounts, the
minimum initial investment is $50. Each Fund reserves the right to offer Fund
shares without regard to minimum purchase requirements to employees
participating in certain qualified and non-qualified employee benefit plans
or other programs where contributions or account information can be
transmitted in a manner and form acceptable to such Fund. Each Fund reserves
the right to vary further the initial and subsequent investment minimum
requirements at any time.
You may purchase Fund shares by check or wire. Checks should be made
payable to "The Dreyfus Family of Funds" or, if for Dreyfus retirement plan
accounts, to "The Dreyfus Trust Company, Custodian." Payments to open new
accounts which are mailed should be sent to The Dreyfus Family of Funds, P.O.
Box 9387, Providence, Rhode Island 02940-9387, together with your Account
Application indicating that Class B shares are being purchased. For
subsequent investments, your Fund
8
account number should appear on the check and an investment slip should be
enclosed and sent to The Dreyfus Family of Funds, P.O. Box 105, Newark, New
Jersey 07101-0105. For Dreyfus retirement plan accounts, both initial and
subsequent investments should be sent to The Dreyfus Trust Company, Custodian,
P.O. Box 6427, Providence, Rhode Island 02940-6427. Neither initial nor
subsequent investments should be made by third party check. Purchase orders
may be delivered in person only to a Dreyfus Financial Center. THESE ORDERS
WILL BE FORWARDED TO THE RELEVANT FUND AND WILL BE PROCESSED ONLY UPON RECEIPT
THEREBY. For the location of the nearest Dreyfus Financial Center, please call
one of the telephone numbers listed under "General Information." Other
purchase procedures may be in effect for clients of certain Service Agents.
Wire payments may be made to The Bank of New York if your bank
account 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 #8900251689/General Government Securities Money Market Fund, Inc.,
or DDA #8900251662/General Money Market Fund, Inc., for purchase of Fund
shares in your name. The wire must include your Fund account number (for new
accounts, your Taxpayer Identification Number ("TIN") should be included
instead), account registration and dealer number, if applicable, and must
indicate the Class of shares being purchased. If your initial purchase of
Fund shares is by wire, please call 1-800-645-6561 after completing your wire
payment to obtain your Fund account number. Please include your Fund account
number on the Account Application and promptly mail the Account Application
to the Fund, as no redemptions will be permitted until the Account
Application is received. You may obtain further information about remitting
funds in this manner from your bank. All payments should be made in U.S.
dollars and, to avoid fees and delays, should be drawn only on U.S. banks. A
charge will be imposed if any check used for investment in your account does
not clear. Each Fund makes available to certain large institutions the
ability to issue purchase instructions through compatible computer
facilities.
Fund shares also may be purchased through Dreyfus-AUTOMATIC Asset
BuilderRegistration Mark, the Government Direct Deposit Privilege or the
Payroll Savings Plan described under "Shareholder Services." These services
enable you to make regularly scheduled investments and may provide you with
a convenient way to invest for long-term financial goals. You should be
aware, however, that periodic investment plans do not guarantee a profit and
will not protect an investor against loss in a declining market.
Subsequent investments also may be made by electronic transfer of
funds from an account maintained in a bank or other domestic financial
institution that is an Automated Clearing House member. You must direct the
institution to transmit immediately available funds through the Automated
Clearing House to The Bank of New York with instructions to credit your Fund
account. The instructions must specify your Fund account registration and
your Fund account number preceded by the digits "1111."
Management understands that some Service Agents may impose certain
conditions on their clients which are different from those described in this
Prospectus and, to the extent permitted by applicable regulatory authority,
may charge their clients direct fees for Servicing (as defined under "Service
Plan"). Service Agents may receive different levels of compensation for
selling different classes of shares. You should consult your Service Agent in
this regard.
Fund shares are sold on a continuous basis at the net asset value per
share next determined after an order in proper form and Federal Funds (monies
of member banks within the Federal Reserve System which are held on deposit
at a Federal Reserve Bank) are received by the Transfer Agent or other agent
or entity subject to the direction of such agents in written or telegraphic
form. If you do not remit Federal
9
Funds, your payment must be converted into Federal Funds. This usually occurs
within one business day of receipt of a bank wire and within two business days
of receipt of a check drawn on a member bank of the Federal Reserve System.
Checks drawn on banks which are not members of the Federal Reserve System may
take considerably longer to convert into Federal Funds. Prior to receipt of
Federal Funds, your money will not be invested.
Each Fund's net asset value per share is determined twice each day:
as of 5:00 p.m., New York time and as of 8:00 p.m., New York time. Net asset
value per share of each class is computed by dividing the value of the Fund's
net assets represented by such class (i.e., the value of its assets less
liabilities) by the total number of shares of such class outstanding. See
"Determination of Net Asset Value" in the Statement of Additional
Information.
If your payments are received in or converted into Federal Funds by
12:00 Noon, New York time, by the Transfer Agent, on a business day, you will
receive the dividend declared that day. If your payments are received in or
converted into Federal Funds after 12:00 Noon, New York time, by the Transfer
Agent, you will begin to accrue dividends on the following business day.
Qualified institutions may telephone orders for purchase of Fund
shares. A telephone order placed to the Distributor or its designee in New
York will become effective at the price determined at 5:00 p.m., New York
time, and the shares purchased will receive the dividend on Fund shares
declared on that day, if such order is placed to the Distributor or its
designee in New York by 5:00 p.m., New York time, and Federal Funds are
received by 6:00 p.m., New York time, on that day. A telephone order placed to
the Distributor or its designee in New York after 5:00 p.m., New York time,
but by 8:00 p.m., New York time, on a given day will become effective at the
price determined at 8:00 p.m., New York time, on that day if Federal Funds
are received by 11:00 a.m., New York time, on the next business day. The
shares so purchased will begin to accrue dividends on the business day
following the date the order became effective.
The Distributor may pay dealers a fee of up to .5% of the amount
invested through such dealers in each Fund's shares by employees
participating in qualified or non-qualified employee benefit plans or other
programs where (i) the employers or affiliated employers maintaining such
plans or programs have a minimum of 250 employees eligible for participation
in such plans or programs, or (ii) such plan's or program's aggregate
investment in the Dreyfus Family of Funds or certain other products made
available by the Distributor to such plans or programs exceeds $1,000,000
("Eligible Benefit Plans"). Shares of funds in the Dreyfus Family of Funds
then held by Eligible Benefit Plans will be aggregated to determine the fee
payable. The Distributor reserves the right to cease paying these fees at any
time. The Distributor will pay such fees from its own funds, other than
amounts received from the Fund, including past profits or any other source
available to it.
Federal regulations require that you provide a certified TIN upon
opening or reopening an account. See "Dividends, Distributions and Taxes" and
the Account Application for further information concerning this requirement.
Failure to furnish a certified TIN to a Fund could subject you to a $50
penalty imposed by the Internal Revenue Service (the "IRS").
SHAREHOLDER SERVICES
The services and privileges described under this heading may not be
available to clients of certain Service Agents and some Service Agents may
impose certain conditions on their clients which are different from those
described in this Prospectus. You should consult your Service Agent in this
regard. In addition, use of the privileges noted below may require that the
proper forms and information be filed with and processed by the Transfer
Agent.
10
FUND EXCHANGES _ Clients of certain Service Agents may purchase, in exchange
for shares of a Fund, shares of certain other funds managed or administered
by The Dreyfus Corporation, to the extent such shares are offered for sale in
your state of residence. These funds have different investment objectives
which may be of interest to you. If you desire to use this service, you
should consult your Service Agent or call 1-800-645-6561 to determine if it
is available and whether any conditions are imposed on its use.
To request an exchange, you or your Service Agent acting on your
behalf must give exchange instructions to the Transfer Agent in writing or by
telephone. Before any exchange, you must obtain and should review a copy of
the current prospectus of the fund into which the exchange is being made.
Prospectuses may be obtained by calling 1-800-645-6561. Except in the case of
personal retirement plans, the shares being exchanged must have a current
value of at least $500; furthermore, when establishing a new account by
exchange, the shares being exchanged must have a value of at least the
minimum initial investment required for the fund into which the exchange is
being made. The ability to issue exchange instructions by telephone is given
to shareholders of each Fund automatically, unless you check the applicable
"No" box on the Account Application, indicating that you specifically refuse
this Privilege. The Telephone Exchange Privilege may be established for an
existing account by written request signed by all shareholders on the
account, by a separate signed Shareholder Services Form, available by calling
1-800-645-6561, or by oral request from any of the authorized signatories on
the account by calling 1-800-645-6561. If you have established the Telephone
Exchange Privilege, you may telephone exchange instructions (including over
The Dreyfus TouchRegistration Mark automated telephone system) by calling
1-800-645-6561. If you are calling from overseas, call 516-794-5452. See "How
to Redeem Shares _ Procedures." Upon an exchange into a new account, the
following shareholder services and privileges, as applicable and where
available, will be automatically carried over to the fund into which the
exchange is made: Telephone Exchange Privilege, Check Redemption Privilege, Wi
re Redemption Privilege, Telephone Redemption Privilege and the
dividend/capital gain distribution option (except for Dividend Sweep)
selected by the investor.
Shares will be exchanged at the next determined net asset value;
however, a sales load may be charged with respect to exchanges into funds
sold with a sales load. If you are exchanging into a fund that charges a
sales load, you may qualify for share prices which do not include the sales
load or which reflect a reduced sales load, if the shares you are exchanging
were: (a) purchased with a sales load, (b) acquired by a previous exchange
from shares purchased with a sales load, or (c) acquired through reinvestment
of dividends or distributions paid with respect to the foregoing categories
of shares. To qualify, at the time of the exchange you must notify the
Transfer Agent or your Service Agent must notify the Distributor. Any such
qualification is subject to confirmation of your holdings through a check of
appropriate records. See "Shareholder Services" in the Statement of
Additional Information. No fees currently are charged shareholders directly
in connection with exchanges, although each Fund reserves the right, upon not
less than 60 days' written notice, to charge shareholders a nominal
administrative fee in accordance with rules promulgated by the Securities and
Exchange Commission. Each Fund reserves the right to reject any exchange
request in whole or in part. The availability of Fund Exchanges may be
modified or terminated at any time upon notice to shareholders. See
"Dividends, Distributions and Taxes."
AUTO-EXCHANGE PRIVILEGE _ The Auto-Exchange Privilege enables you to invest
regularly (on a semi-monthly, monthly, quarterly or annual basis), in
exchange for shares of a Fund, in shares of certain other funds in the
Dreyfus Family of Funds of which you are a shareholder. The amount you
designate, which can be expressed either in terms of a specific dollar or
share amount ($100 minimum), will be
11
exchanged automatically on the first and/or fifteenth of the month according
to the schedule you have selected. Shares will be exchanged at the
then-current net asset value; however, a sales load may be charged with
respect to exchanges into funds sold with a sales load. See "Shareholder
Services" in the Statement of Additional Information. The right to exercise
this Privilege may be modified or canceled by the Fund or the Transfer Agent.
You may modify or cancel your exercise of this Privilege at any time by
mailing written notification to The Dreyfus Family of Funds, P.O. Box 9671,
Providence, Rhode Island 02940-9671. Each Fund may charge a service fee for
the use of this Privilege. No such fee currently is contemplated. For more
information concerning this Privilege and the funds in the Dreyfus Family of
Funds eligible to participate in this Privilege, or to obtain an Auto-Exchange
Authorization Form, please call toll free 1-800-645-6561. See "Dividends,
Distributions and Taxes."
DREYFUS-AUTOMATIC ASSET BUILDERRegistration Mark _ Dreyfus-AUTOMATIC Asset
Builder permits you to purchase Fund shares (minimum of $100 and maximum of
$150,000 per transaction) at regular intervals selected by you. Fund shares
are purchased by transferring funds from the bank account designated by you.
At your option, the bank account designated by you will be debited in the
specified amount, and Fund shares will be purchased, once a month, on either
the first or fifteenth day, or twice a month, on both days. Only an account
maintained at a domestic financial institution which is an Automated Clearing
House member may be so designated. To establish a Dreyfus-AUTOMATIC Asset
Builder account, you must file an authorization form with the Transfer Agent.
You may obtain the necessary authorization form from your Service Agent or by
calling 1-800-645-6561. You may cancel your participation in this Privilege
or change the amount of your purchase at any time by mailing written
notification to The Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode
Island 02940-9671, or, if for Dreyfus retirement plan accounts, to The
Dreyfus Trust Company, Custodian, P.O. Box 6427, Providence, Rhode Island
02940-6427, and the notification will be effective three business days
following receipt. Each Fund may modify or terminate this Privilege at any
time or charge a service fee. No such fee currently is contemplated.
GOVERNMENT DIRECT DEPOSIT PRIVILEGE _ The Government Direct Deposit
Privilege enables you to purchase Fund shares (minimum of $100 and maximum of
$50,000 per transaction) by having Federal salary, Social Security, or
certain veterans', military or other payments from the Federal government,
automatically deposited into your Fund account. You may deposit as much of
such payments as you elect. To enroll in Government Direct Deposit, you must
file with the Transfer Agent a completed Direct Deposit Sign-Up Form for each
type of payment that you desire to include in this Privilege. The appropriate
form may be obtained from your Service Agent or by calling 1-800-645-6561.
Death or legal incapacity will terminate your participation in this
Privilege. You may elect at any time to terminate your participation by
notifying in writing the appropriate Federal agency. Further, a Fund may
terminate your participation upon 30 days' notice to you.
PAYROLL SAVINGS PLAN _ The Payroll Savings Plan permits you to purchase Fund
shares (minimum of $100 per transaction) automatically on a regular basis.
Depending upon your employer's direct deposit program, you may have part or
all of your paycheck transferred to your existing Dreyfus account
electronically through the Automated Clearing House system at each pay
period. To establish a Payroll Savings Plan account, you must file an
authorization form with your employer's payroll department. Your employer
must complete the reverse side of the form and return it to The Dreyfus
Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. You may
obtain the necessary authorization form by calling 1-800-645-6561. You may
change the amount of purchase or cancel the autho-
12
rization only by written notification to your employer. It is the sole
responsibility of your employer, not the Distributor, The Dreyfus Corporation,
the Fund, the Transfer Agent or any other person, to arrange for transactions
under the Payroll Savings Plan. Each Fund may modify or terminate this
Privilege at any time or charge a service fee. No such fee currently is
contemplated.
DIVIDEND OPTIONS _ Dividend Sweep enables you to invest automatically
dividends or dividends and capital gain distributions, if any, paid by a Fund
in shares of another fund in the Dreyfus Family of Funds of which you are a
shareholder. Shares of the other fund will be purchased at the then-current
net asset value; however, a sales load may be charged with respect to
investments in shares of a fund sold with a sales load. If you are investing
in a fund that charges a sales load, you may qualify for share prices which do
not include the sales load or which reflect a reduced sales load. If you are
investing in a fund that charges a contingent deferred sales charge, the
shares purchased will be subject on redemption to the contingent deferred
sales charge, if any, applicable to the purchased shares. See "Shareholder
Services" in the Statement of Additional Information. Dividend ACH permits
you to transfer electronically dividends or dividends and capital gain
distributions, if any, from a Fund to a designated bank account. Only an
account maintained at a domestic financial institution which is an Automated
Clearing House member may be so designated. Banks may charge a fee for this
service.
For more information concerning these privileges or to request a
Dividend Options Form, please call toll free 1-800-645-6561. You may cancel
these privileges by mailing written notification to The Dreyfus Family of
Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. Enrollment in or
cancellation of these privileges is effective three business days following
receipt. These privileges are available only for existing accounts and may
not be used to open new accounts. Minimum subsequent investments do not apply
for Dividend Sweep. Each Fund may modify or terminate these privileges at any
time or charge a service fee. No such fee currently is contemplated. Shares
held under Keogh Plans or IRAs are not eligible for Dividend Sweep.
QUARTERLY DISTRIBUTION PLAN _ The Quarterly Distribution Plan permits you to
receive quarterly payments from a Fund consisting of proceeds from the
redemption of shares purchased for your account through the automatic
reinvestment of dividends declared on your account during the preceding
calendar quarter. You may open a Quarterly Distribution Plan by submitting a
request to the Transfer Agent. The Quarterly Distribution Plan may be ended
at any time by you, the Fund or the Transfer Agent. Shares for which
certificates have been issued must be presented before redemption under the
Quarterly Distribution Plan.
AUTOMATIC WITHDRAWAL PLAN _ The Automatic Withdrawal Plan permits you to
request withdrawal of a specified dollar amount (minimum of $50) on either a
monthly or quarterly basis if you have a $5,000 minimum account. An
application for the Automatic Withdrawal Plan can be obtained by calling
1-800-645-6561. The Automatic Withdrawal Plan may be ended at any time by
you, the Fund or the Transfer Agent. Shares for which certificates have been
issued may not be redeemed through the Automatic Withdrawal Plan.
RETIREMENT PLANS _ Each Fund offers a variety of pension and profit-sharing
plans, including Keogh Plans, IRAs, SEP-IRAs and IRA "Rollover Accounts,"
401(k) Salary Reduction Plans and 403(b)(7) Plans. Plan support services also
are available. You can obtain details on the various plans by calling the
following numbers toll free: for Keogh Plans, please call 1-800-358-5566; for
IRAs and IRA "Rollover Accounts," please call 1-800-645-6561; or for SEP-IRAs,
401(k) Salary Reduction Plans and 403(b)(7) Plans, please call 1-800-322-7880.
13
HOW TO REDEEM SHARES
GENERAL
You may request redemption of your shares at any time. Redemption
requests should be transmitted to the Transfer Agent as described below. When
a request is received in proper form, the Fund will redeem the shares at the
next determined net asset value.
Neither Fund imposes any charges when shares are redeemed. Service
Agents may charge their clients a fee for effecting redemptions of Fund
shares. Any certificates representing Fund shares being redeemed must be
submitted with the redemption request. The value of the shares redeemed may
be more or less than their original cost, depending upon the respective
Fund's then-current net asset value.
Each Fund ordinarily will make payment for all shares redeemed within
seven days after receipt by the Transfer Agent of a redemption request in
proper form, except as provided by the rules of the Securities and Exchange
Commission. HOWEVER, IF YOU HAVE PURCHASED FUND SHARES BY CHECK OR THROUGH
DREYFUS-AUTOMATIC ASSET BUILDERRegistration Mark AND SUBSEQUENTLY SUBMIT A
WRITTEN REDEMPTION REQUEST TO THE TRANSFER AGENT, YOUR REDEMPTION WILL BE
EFFECTIVE AND THE REDEMPTION PROCEEDS WILL BE TRANSMITTED TO YOU PROMPTLY
UPON BANK CLEARANCE OF YOUR PURCHASE CHECK OR DREYFUS-AUTOMATIC ASSET BUILDER
ORDER, WHICH MAY TAKE UP TO EIGHT BUSINESS DAYS OR MORE. IN ADDITION, EACH
FUND WILL NOT HONOR REDEMPTION CHECKS UNDER THE CHECK REDEMPTION PRIVILEGE,
AND WILL REJECT REQUESTS TO REDEEM SHARES BY WIRE OR TELEPHONE, FOR A PERIOD
OF EIGHT BUSINESS DAYS AFTER RECEIPT BY THE TRANSFER AGENT OF THE PURCHASE
CHECK OR THE DREYFUS-AUTOMATIC ASSET BUILDER ORDER AGAINST WHICH SUCH
REDEMPTION IS REQUESTED. THESE PROCEDURES WILL NOT APPLY IF YOUR SHARES WERE
PURCHASED BY WIRE PAYMENT, OR IF YOU OTHERWISE HAVE A SUFFICIENT COLLECTED
BALANCE IN YOUR ACCOUNT TO COVER THE REDEMPTION REQUEST. PRIOR TO THE TIME
ANY REDEMPTION IS EFFECTIVE, DIVIDENDS ON SUCH SHARES WILL ACCRUE AND BE
PAYABLE, AND YOU WILL BE ENTITLED TO EXERCISE ALL OTHER RIGHTS OF BENEFICIAL
OWNERSHIP. Fund shares will not be redeemed until the Transfer Agent has
received your Account Application.
The Fund reserves the right to redeem your account at its option upon
not less than 45 days' written notice if your account's net asset value is
$500 or less and remains so during the notice period.
PROCEDURES
You may redeem shares by using the regular redemption procedure
through the Transfer Agent, or through the Telephone Redemption Privilege
which is granted automatically unless you specifically refuse it by checking
the applicable "No" box on the Account Application. The Telephone Redemption
Privilege may be established for an existing account by a separate signed
Shareholder Services Form or by oral request from any of the authorized
signatories on the account by calling 1-800-645-6561. You also may redeem
shares through the Check Redemption Privilege, the Wire Redemption Privilege,
or the Dreyfus TELETRANSFER Privilege, if you have checked the appropriate
box and supplied the necessary information on the Account Application or have
filed a Shareholder Services Form with the Transfer Agent. If you are a
client of a Selected Dealer, you may redeem Fund shares through the Selected
Dealer. Other redemption procedures may be in effect for clients of certain
Service Agents. Each Fund makes available to certain large institutions the
ability to issue redemption instructions through compatible computer
facilities. Each Fund reserves the right to refuse any request made by wire
or telephone, including requests made shortly after a change of address, and
may limit the amount involved or the number of such requests. Each Fund may
modify or terminate any redemption Privilege at any time or charge a service
fee upon notice to shareholders.
14
No such fee currently is contemplated. Shares held under Keogh Plans, IRAs or
other retirement plans, and shares for which certificates have been issued,
are not eligible for the Check Redemption, Wire Redemption or Telephone
Redemption Privilege.
The Telephone Redemption Privilege and Telephone Exchange Privilege
authorizes the Transfer Agent to act on telephone instructions (including
over The Dreyfus TouchRegistration Mark automated telephone system) from any
person representing himself or herself to be you, or a representative of your
Service Agent, and reasonably believed by the Transfer Agent to be genuine.
Each Fund will require the Transfer Agent to employ reasonable procedures,
such as requiring a form of personal identification, to confirm that
instructions are genuine and, if it does not follow such procedures, the Fund
or the Transfer Agent may be liable for any losses due to unauthorized or
fraudulent instructions. Neither the Funds nor the Transfer Agent will be
liable for following telephone instructions reasonably believed to be
genuine.
During times of drastic economic or market conditions, you may
experience difficulty in contacting the Transfer Agent by telephone to
request a redemption or exchange of Fund shares. In such cases, you should
consider using the other redemption procedures described herein. Use of these
other redemption procedures may result in your redemption request being
processed at a later time than it would have been if telephone redemption had
been used.
REGULAR REDEMPTION _ Under the regular redemption procedure, you may redeem
shares by written request mailed to The Dreyfus Family of Funds, P.O. Box
9671, Providence, Rhode Island 02940-9671, or, if for Dreyfus retirement plan
accounts, to The Dreyfus Trust Company, Custodian, P.O. Box 6427, Providence,
Rhode Island 02940-6427. Redemption requests may be delivered in person only
to a Dreyfus Financial Center. For the location of the nearest Dreyfus
Financial Center, please call one of the telephone numbers listed under
"General Information." THESE REQUESTS WILL BE FORWARDED TO THE FUND AND WILL
BE PROCESSED ONLY UPON RECEIPT THEREBY. Redemption requests must be signed by
each shareholder, including each owner of a joint account, and each signature
must be guaranteed. The Transfer Agent has adopted standards and procedures
pursuant to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations, as well as from participants in the New York Stock
Exchange Medallion Signature Program, the Securities Transfer Agents
Medallion Program ("STAMP"), and the Stock Exchanges Medallion Program. If
you have questions with respect to signature-guarantees, please call one of
the telephone numbers listed under "General Information."
Redemption proceeds of at least $1,000 will be wired to any member
bank of the Federal Reserve System in accordance with a written
signature-guaranteed request.
CHECK REDEMPTION PRIVILEGE _ You may write Redemption Checks drawn on your
Fund account. Redemption Checks may be made payable to the order of any
person in the amount of $500 or more. Redemption Checks should not be used to
close your account. Redemption Checks are free, but the Transfer Agent will
impose a fee for stopping payment of a Redemption Check upon your request or
if the Transfer Agent cannot honor a Redemption Check due to insufficient
funds or other valid reason. You should date your Redemption Checks with the
current date when you write them. Please do not postdate your Redemption
Checks. If you do, the Transfer Agent will honor, upon presentment, even if
presented before the date of the check, all postdated Redemption Checks which
are dated within six months of presentment for payment, if they are otherwise
in good order. If you hold shares in a Dreyfus
15
sponsored IRA account, you may be permitted to make withdrawals from your IRA
account using checks furnished to you by The Dreyfus Trust Company.
WIRE REDEMPTION PRIVILEGE _ You may request by wire or telephone that
redemption proceeds (minimum $1,000) be wired to your account at a bank which
is a member of the Federal Reserve System, or a correspondent bank if your
bank is not a member. Holders of jointly registered Fund or bank accounts may
have redemption proceeds of not more than $250,000 wired within any 30-day
period. You may telephone redemption requests by calling 1-800-645-6561 or,
if you are calling from overseas, call 516-794-5452. The Statement of
Additional Information sets forth instructions for transmitting redemption
requests by wire.
TELEPHONE REDEMPTION PRIVILEGE _ You may request by telephone that
redemption proceeds (maximum $150,000 per day) be paid by check and mailed to
your address. You may telephone redemption instructions by calling
1-800-645-6561 or, if you are calling from overseas, call 516-794-5452. The
Telephone Redemption Privilege is granted automatically unless you refuse it.
REDEMPTION THROUGH A SELECTED DEALER _ If you are a customer of a Selected
Dealer, you may make redemption requests to your Selected Dealer. If the
Selected Dealer transmits the redemption request so that it is received by
the Transfer Agent by 5:00 p.m., New York time, on a business day, the
proceeds of the redemption ordinarily will be transmitted in Federal Funds on
the same day and the shares will not receive the dividend declared on that
day. If a redemption request is received by the Transfer Agent after 5:00
p.m., New York time, but by 8:00 p.m., New York time, the redemption request
will be effective on that day, the shares will receive the dividend declared
on that day and the proceeds of redemption ordinarily will be transmitted in
Federal Funds on the next business day. It is the responsibility of the
Selected Dealer to transmit a request so that it is received in a timely
manner. The proceeds of the redemption are credited to your account with the
Selected Dealer.
DISTRIBUTION PLAN
Class B shares of each Fund are subject to a separate Distribution
Plan adopted pursuant to Rule 12b-1 under the 1940 Act. Under each
Distribution Plan, the Fund directly bears the costs of preparing, printing
and distributing prospectuses and statements of additional information and of
implementing and operating the Distribution Plan. In addition, each Fund
reimburses the Distributor for payments made to third parties for
distributing (within the meaning of Rule 12b-1) Class B shares at an
aggregate annual rate of up to .20 of 1% of the value of the Fund's average
daily net assets attributable to Class B.
SHAREHOLDER SERVICES PLAN
Each Fund has adopted a separate Shareholder Services Plan pursuant
to which the Fund pays the Distributor for the provision of certain services
to the holders of Class B shares a fee at the annual rate of .25 of 1% of the
value of the Fund's average daily net assets attributable to Class B. The
services provided may include personal services relating to shareholder
accounts, such as answering shareholder inquiries regarding the Fund and
providing reports and other information, and services related to the
maintenance of such shareholder accounts. Under each Fund's Shareholder
Services Plan, the Distributor may make payments to Service Agents in respect
of these services. The Distributor determines the amounts to be paid to
Service Agents.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Each Fund ordinarily declares dividends from its net investment
income on each day the New York Stock Exchange or, for the Money Fund only,
the Transfer Agent is open for business. The Fund's
16
earnings for Saturdays, Sundays and holidays are declared as dividends on the
preceding business day. Dividends usually are paid on the last calendar day of
each month and automatically are reinvested in additional shares at net asset
value or, at your option, paid in cash. If you redeem all shares in your
account at any time during the month, all dividends to which you are entitled
will be paid to you along with the proceeds of the redemption. If you are an
omnibus accountholder and indicate in a partial redemption request that a
portion of any accrued dividends to which such account is entitled belongs to
an underlying accountholder who has redeemed all shares in his or her account,
such portion of the accrued dividends will be paid to you along with the
proceeds of the redemption. Distributions from net realized securities gains,
if any, generally are declared and paid once a year, but each Fund may make
distributions on a more frequent basis to comply with the distribution
requirements of the Internal Revenue Code of 1986, as amended (the "Code"),
in all events in a manner consistent with the provisions of the 1940 Act. No
Fund will make distributions from net realized securities gains unless
capital loss carryovers, if any, have been utilized or have expired. You may
choose whether to receive distributions in cash or to reinvest in additional
shares at net asset value. All expenses are accrued daily and deducted before
declaration of dividends to investors. Dividends paid by each class will be
calculated at the same time and in the same manner and will be in the same
amount, except that the expenses attributable solely to a class will be borne
exclusively by such class.
Dividends paid by each Fund derived from interest, together with
distributions from any net realized short-term securities gains and all or a
portion of any gains realized from the sale or other disposition of certain
market discount bonds, are subject to Federal income tax as ordinary income,
whether received in cash or reinvested in additional Fund shares.
Distributions from net realized long-term securities gains, if any, will be
taxable as long-term capital gains for Federal income tax purposes if you are
a citizen or resident of the United States. The Code provides that the net
capital gain of an individual generally will not be subject to Federal income
tax at a rate in excess of 28%. Dividends and distributions may be subject to
state and local taxes.
Dividends and distributions attributable to interest from direct
obligations of the United States and paid by each Fund to individuals
currently are not subject to tax in most states. Dividends and distributions
attributable to interest from other securities in which each Fund may invest
may be subject to state tax. Each Fund intends to provide shareholders with a
statement which sets forth the percentage of dividends and distributions paid
by the Fund that is attributable to interest income from direct obligations
of the United States.
Dividends derived from net investment income, together with
distributions from net realized short-term securities gains and all or a
portion of any gains realized from the sale or other disposition of certain
market discount bonds, paid by each Fund to a foreign investor generally are
subject to U.S. nonresident withholding taxes at the rate of 30%, unless the
foreign investor claims the benefit of a lower rate specified in a tax
treaty. Distributions from net realized long-term securities gains paid by a
Fund to a foreign investor generally will not be subject to U.S. nonresident
withholding tax. However, such distributions may be subject to backup
withholding, as described below, unless the foreign investor certifies his
non-U.S. residency status.
Notice as to the tax status of your dividends and distributions will
be mailed to you annually. You also will receive periodic summaries of your
account which will include information as to dividends and distributions from
securities gains, if any, paid during the year. No dividends will qualify for
the dividend received deduction allowable to certain U.S. corporations.
17
The exchange of shares of one fund for shares of another is treated
for Federal income tax purposes as a sale of the shares given in exchange by
the shareholder and, therefore, an exchanging shareholder may realize a
taxable gain or loss.
Federal regulations generally require each Fund to withhold ("backup
withholding") and remit to the U.S. Treasury 31% of dividends and
distributions from net realized securities gains of the Fund paid to a
shareholder if such shareholder fails to certify either that the TIN
furnished in connection with opening an account is correct, or that such
shareholder has not received notice from the IRS of being subject to backup
withholding as a result of a failure to properly report taxable dividend or
interest income on a Federal income tax return. Furthermore, the IRS may
notify a Fund to institute backup withholding if the IRS determines a
shareholder's TIN is incorrect or if a shareholder has failed to properly
report taxable dividend and interest income on a Federal income tax return.
A TIN is either the Social Security number or employer identification
number of the record owner of the account. Any tax withheld as a result of
backup withholding does not constitute an additional tax imposed on the
record owner of the account, and may be claimed as a credit on the record
owner's Federal income tax return.
Management believes that each Fund has qualified for the fiscal year
ended January 31, 1997 as a "regulated investment company" under the Code.
Each Fund intends to continue to so qualify if such qualification is in the
best interests of its shareholders. Such qualification relieves the Fund of
any liability for Federal income tax to the extent its earnings are
distributed in accordance with applicable provisions of the Code. Each Fund
is subject to a non-deductible 4% excise tax, measured with respect to
certain undistributed amounts of taxable investment income and capital gains.
You should consult your tax adviser regarding specific questions as
to Federal, state and local taxes.
GENERAL INFORMATION
The Government Money Fund and the Money Fund were incorporated under
Maryland law on April 8, 1982, and May 15, 1981, respectively, and commenced
operations on February 7, 1983 and February 8, 1982, respectively. Each Fund
is authorized to issue 15 billion shares of Class A Common Stock and one
billion shares of Class B Common Stock, par value $.01 per share. Each Fund's
shares are classified into two classes_Class A and Class B. Each share has
one vote and shareholders will vote in the aggregate and not by class except
as otherwise required by law.
Unless otherwise required by the 1940 Act, ordinarily it will not be
necessary for either Fund to hold annual meetings of shareholders. As a
result, Fund shareholders may not consider each year the election of Board
members or the appointment of auditors. However, pursuant to each Fund's
By-Laws, the holders of at least 10% of the shares outstanding and entitled
to vote may require such Fund to hold a special meeting of shareholders for
purposes of removing a Board member from office and the holders of at least
25% of such shares may require such Fund to hold a special meeting of
shareholders for any other purpose. Fund shareholders may remove a Board
member by the affirmative vote of a majority of the relevant Fund's
outstanding voting shares. In addition, a Fund's Board will call a special
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 Transfer Agent maintains a record of your ownership and sends
confirmations and statements of account.
18
Shareholder inquiries may be made to your Service Agent or by writing
to a Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144, or
by calling toll free 1-800-242-8671. In New York City, call 1-718-895-1396;
outside the U.S., call 516-794-5452.
Although each Fund is offering only its own shares, it is possible
that a Fund might become liable for any misstatement in this Prospectus about
the other Fund. Each Fund's Board has considered this factor in approving the
use of this combined Prospectus.
19
APPENDIX
INVESTMENT TECHNIQUES
BORROWING _ Each Fund may borrow money from banks for temporary or emergency
(not leveraging) purposes in an amount up to 15% of the value of its total
assets (including the amount borrowed) valued at the lesser of cost or
market, less liabilities (not including the amount borrowed) at the time the
borrowing is made. While borrowings exceed 5% of the value of a Fund's total
assets, such Fund will not make any additional investments.
CERTAIN PORTFOLIO SECURITIES
U.S. GOVERNMENT SECURITIES _ Securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities include U.S. Treasury
securities, which differ in their interest rates, maturities and times of
issuance. Some obligations issued or guaranteed by U.S. Government agencies
and instrumentalities are supported by the full faith and credit of the U.S.
Treasury; others by the right of the issuer to borrow from the Treasury;
others by discretionary authority of the U.S. Government to purchase certain
obligations of the agency or instrumentality; and others only by the credit
of the agency or instrumentality. These securities bear fixed, floating or
variable rates of interest. Interest may fluctuate based on generally
recognized reference rates or the relationship of rates. While the U.S.
Government currently provides financial support to such U.S.
Government-sponsored agencies or instrumentalities, no assurance can be given
that it will always do so, since it is not so obligated by law.
REPURCHASE AGREEMENTS _ In a repurchase agreement, a Fund buys, and the
seller agrees to repurchase, a security at a mutually agreed upon time and
price (usually within seven days). The repurchase agreement thereby
determines the yield during the purchaser's holding period, while the
seller's obligation to repurchase is secured by the value of the underlying
security. Repurchase agreements could involve risks in the event of a default
or insolvency of the other party to the agreement, including possible delays
or restrictions upon the Fund's ability to dispose of the underlying
securities. Each Fund may enter into repurchase agreements with certain banks
or non-bank dealers.
ILLIQUID SECURITIES _ Each Fund may invest up to 10% 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 Fund's investment
objective. Such securities may include securities that are not readily
marketable, such as certain securities that are subject to legal or
contractual restrictions on resale, and repurchase agreements providing for
settlement in more than seven days after notice. As to these securities, the
Fund is subject to a risk that should the Fund desire to sell them when a
ready buyer is not available at a price the Fund deems representative of
their value, the value of the Fund's net assets could be adversely affected.
BANK OBLIGATIONS (MONEY FUND ONLY) _ The Fund may purchase certificates of
deposit, time deposits, bankers' acceptances and other short-term obligations
issued by domestic banks, foreign subsidiaries or foreign branches of
domestic banks, domestic and foreign branches of foreign banks, and thrift
institutions, savings and loan associations and other banking institutions.
With respect to such securities issued by foreign subsidiaries or foreign
branches of domestic banks, and domestic and foreign branches of foreign
banks, the Fund may be subject to additional investment risks that are
different in some respects from those incurred by a fund which invests only
in debt obligations of U.S. domestic issuers. See "Description of the Funds
_ Investment Considerations and Risks _ Foreign Securities."
Certificates of deposit are negotiable certificates evidencing the
obligation of a bank to repay funds deposited with it for a specified period
of time.
20
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time (in no event longer than seven
days) at a stated interest rate.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments reflect
the obligation both of the bank and the drawer to pay the face amount of the
instrument upon maturity. The other short-term obligations may include
uninsured, direct obligations bearing fixed, floating or variable interest
rates.
COMMERCIAL PAPER (MONEY FUND ONLY) _ Commercial paper consists of
short-term, unsecured promissory notes issued to finance short-term credit
needs. The commercial paper purchased by the Fund will consist only of direct
obligations issued by domestic and foreign entities. The other corporate
obligations in which the Fund may invest consist of high quality, U.S. dollar
denominated short-term bonds and notes (including variable amount master
demand notes) issued by domestic and foreign corporations, including banks.
FLOATING AND VARIABLE RATE OBLIGATIONS (MONEY FUND ONLY) _ The Fund may
purchase floating and variable rate demand notes and bonds, which are
obligations ordinarily having stated maturities in excess of 13 months, but
which permit the holder to demand payment of principal at any time, or at
specified intervals not exceeding 13 months, in each case upon not more than
30 days' notice. Variable rate demand notes include master demand notes which
are obligations that permit the Fund to invest fluctuating amounts, at
varying rates of interest, pursuant to direct arrangements between the Fund,
as lender, and the borrower. These obligations permit daily changes in the
amounts borrowed. Because these obligations are direct lending arrangements
between the lender and borrower, it is not contemplated that such instruments
generally will be traded, and there generally is no established secondary
market for these obligations, although they are redeemable at face value,
plus accrued interest. Accordingly, where these obligations are not secured
by letters of credit or other credit support arrangements, the Fund's right
to redeem is dependent on the ability of the borrower to pay principal and
interest on demand.
PARTICIPATION INTERESTS (MONEY FUND ONLY) _ The Fund may purchase from
financial institutions participation interests in securities in which the
Fund may invest. A participation interest gives the Fund an undivided
interest in the security in the proportion that the Fund's participation
interest bears to the total principal amount of the security. These
instruments may have fixed, floating or variable rates of interest, with
remaining maturities of 13 months or less. If the participation interest is
unrated, or has been given a rating below that which is permissible for
purchase by the Fund, the participation interest will be backed by an
irrevocable letter of credit or guarantee of a bank, or the payment
obligation otherwise will be collateralized by U.S. Government securities,
or, in the case of unrated participation interests, The Dreyfus Corporation
must have determined that the instrument is of comparable quality to those
instruments in which the Fund may invest.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND IN THE
FUND'S OFFICIAL SALES LITERATURE IN CONNECTION WITH THE OFFER OF THE FUND'S
SHARES, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH, OR TO ANY PERSON TO WHOM,
SUCH OFFERING MAY NOT LAWFULLY BE MADE.
21
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22
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23
General
Government Securities
Money Market Fund, Inc.
General
Money Market Fund, Inc.
Combined Prospectus
CLASS B SHARES
GENERAL MONEY MARKET FUND, INC.
GENERAL GOVERNMENT SECURITIES MONEY MARKET FUND, INC.
CLASS A AND CLASS B
COMBINED PART B
(STATEMENT OF ADDITIONAL INFORMATION)
JUNE 1, 1997
AS REVISED AUGUST 25, 1997
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current combined
Prospectus for each class of shares of General Government Securities Money
Market Fund, Inc. (the "Government Money Fund") and General Money Market
Fund, Inc. (the "Money Fund" and together with the Government Money Fund,
the "Funds"), dated June 1, 1997, as they may be revised from time to time.
To obtain a copy of the Prospectus for a class of shares of a Fund, please
write to a Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-
0144, or call the following numbers:
Call Toll Free 1-800-645-6561
In New York City -- Call 1-718-895-1396
Outside the U.S. -- Call 516-794-5452
The Dreyfus Corporation (the "Manager") serves as each Fund's
investment adviser.
Premier Mutual Fund Services, Inc. (the "Distributor") is the
distributor of each Fund's shares.
Each Fund is a separate entity with a separate portfolio. The
operations and investment results of one Fund are unrelated to those of the
other Fund. This combined Statement of Additional Information has been
provided for your convenience to provide you with the opportunity to
consider two investment choices in one document.
TABLE OF CONTENTS
Page
Investment Objective and Management Policies B-2
Management of the Funds B-6
Management Agreements B-10
Purchase of Shares B-12
Service Plan and Distribution Plan B-13
Shareholder Services Plans B-14
Redemption of Shares B-15
Shareholder Services B-17
Determination of Net Asset Value B-20
Dividends, Distributions and Taxes B-21
Yield Information B-22
Portfolio Transactions B-23
Information About the Funds B-23
Transfer and Dividend Disbursing Agent, Custodian,
Counsel and Independent Auditors B-23
Appendix B-25
Financial Statements and Reports of Independent Auditor B-28
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES
The following information supplements and should be read in conjunction
with the sections of each Fund Prospectus entitled "Description of the
Funds" and "Appendix."
Portfolio Securities
Repurchase Agreements. Each Fund's custodian or sub-custodian will
have custody of, and will hold in a segregated account, securities acquired
by the Fund under a repurchase agreement. Repurchase agreements are
considered by the staff of the Securities and Exchange Commission to be
loans by each Fund. In an attempt to reduce the risk of incurring a loss on
a repurchase agreement, each Fund will enter into repurchase agreements only
with domestic banks with total assets in excess of $1 billion, or primary
government securities dealers reporting to the Federal Reserve Bank of New
York, with respect to securities of the type in which the Fund may invest,
and will require that additional securities be deposited with it if the
value of the securities purchased should decrease below the resale price.
Illiquid Securities. Where a substantial market of qualified
institutional buyers develops for certain restricted securities purchased by
each Fund pursuant to Rule 144A under the Securities Act of 1933, as
amended, each Fund intends to treat such securities as liquid securities in
accordance with procedures approved by the Fund's Board. Because it is not
possible to predict with assurance how the market for restricted securities
pursuant to Rule 144A will develop, each Fund's Board has directed the
Manager to monitor carefully the Fund's investments in such securities with
particular regard to trading activity, availability of reliable price
information and other relevant information. To the extent that, for a
period of time, qualified institutional buyers cease purchasing restricted
securities pursuant to Rule 144A, a Fund's investing in such securities may
have the effect of increasing the level of illiquidity in the Fund's
portfolio during such period.
The following applies to the Money Fund:
Bank Obligations. As a result of Federal and state laws and
regulations, domestic banks whose certificates of deposit ("CDs") may be
purchased by the Money Fund are, among other things, generally required to
maintain specified levels of reserves, and are subject to other supervision
and regulation designed to promote financial soundness. However, not all of
such laws and regulations apply to the foreign branches of domestic banks.
Domestic commercial banks organized under Federal law are supervised and
examined by the Comptroller of the Currency and are required to be members
of the Federal Reserve System and to have their deposits insured by the
Federal Deposit Insurance Corporation (the "FDIC"). Domestic banks organized
under state law are supervised and examined by state banking authorities but
are members of the Federal Reserve System only if they elect to join. In
addition, state banks whose CDs may be purchased by the Money Fund are
insured by the Bank Insurance Fund administered by the FDIC (although such
insurance may not be of material benefit to the Money Fund, depending upon
the principal amount of the CDs of each bank held by the Money Fund) and are
subject to Federal examination and to a substantial body of Federal law and
regulation.
Obligations of foreign branches of domestic banks, foreign subsidiaries
of domestic banks and domestic and foreign branches of foreign banks, such
as CDs and time deposits ("TDs"), may be general obligations of the parent
banks in addition to the issuing branch, or may be limited by the terms of a
specific obligation and governmental regulation. Such obligations are
subject to different risks than are those of domestic banks. These risks
include foreign economic and political developments, foreign governmental
restrictions that may adversely affect payment of principal and interest on
the obligations, foreign exchange controls and foreign withholding and other
taxes on interest income. These foreign branches and subsidiaries are not
necessarily subject to the same or similar regulatory requirements as apply
to domestic banks, such as mandatory reserve requirements, loan limitations,
and accounting, auditing and financial recordkeeping requirements. In
addition, less information may be publicly available about a foreign branch
of a domestic bank or about a foreign bank than about a domestic bank.
Obligations of United States branches of foreign banks may be general
obligations of the parent bank in addition to the issuing branch, or may be
limited by the terms of a specific obligation or by Federal and state
regulation as well as governmental action in the country in which the
foreign bank has its head office. A domestic branch of a foreign bank with
assets in excess of one billion dollars may be subject to reserve
requirements imposed by the Federal Reserve System or by the state in which
the branch is located if the branch is licensed in that state.
In addition, Federal branches licensed by the Comptroller of the
Currency and branches licensed by certain states ("State Branches") may
required to: (1) pledge to the regulator, by depositing assets with a
designated bank within the state, a certain percentage of their assets as
fixed from time to time by the appropriate regulatory authority; and (2)
maintain assets within the state in an amount equal to a specified
percentage of the aggregate amount of liabilities of the foreign bank
payable at or through all of its agencies or branches within the state. The
deposits of Federal or State Branches generally must be insured by the FDIC
if such branches take deposits of less than $100,000.
In view of the foregoing factors associated with the purchase of CDs
and TDs issued by foreign branches of domestic banks, by foreign
subsidiaries of domestic banks, by foreign branches of foreign banks or by
domestic branches of foreign banks, the Manager carefully evaluates such
investments on a case-by-case basis.
The Money Fund may purchase CDs issued by banks, savings and loan
associations and similar thrift institutions with less than one billion
dollars in assets, the deposits of which are insured by the FDIC, provided
the Money Fund purchases any such CD in a principal amount of no more than
$100,000, which amount would be fully insured by the Bank Insurance Fund or
the Savings Association Insurance Fund administered by the FDIC. Interest
payments on such a CD are not insured by the FDIC. The Money Fund will not
own more than one such CD per such issuer.
Investment Restrictions
Money Fund. The Money Fund has adopted investment restrictions
numbered 1 through 12 as fundamental policies, which cannot be changed
without approval by the holders of a majority (as defined in the Investment
Company Act of 1940, as amended (the "1940 Act")) of the Fund's outstanding
voting shares. Investment restriction number 13 is not a fundamental policy
and may be changed by vote of a majority of the Money Fund's Board members
at any time. The Money Fund may not:
1. Purchase common stocks, preferred stocks, warrants or other equity
securities, or purchase corporate bonds or debentures, state bonds,
municipal bonds or industrial revenue bonds (except through the purchase of
debt obligations referred to under "Description of the Funds" in the
Prospectus and under "Investment Objective and Management Policies" in this
Statement of Additional Information).
2. Borrow money, except from banks for temporary or emergency (not
leveraging) purposes in an amount up to 15% of the value of the Fund's total
assets (including the amount borrowed) based on the lesser of cost or
market, less liabilities (not including the amount borrowed) at the time the
borrowing is made. While borrowings exceed 5% of the value of the Fund's
total assets, the Fund will not make any additional investments.
3. Pledge its assets, except in an amount up to 15% of the value of
its total assets but only to secure borrowings for temporary or emergency
purposes.
4. Sell securities short.
5. Write or purchase put or call options.
6. Underwrite the securities of other issuers.
7. Purchase or sell real estate investment trust securities,
commodities, or oil and gas interests.
8. Make loans to others (except through the purchase of debt
obligations referred to under "Description of the Funds" in the Prospectus
and under "Investment Objective and Management Policies" in this Statement
of Additional Information).
9. Invest more than 15% of its assets in the obligations of any one
bank, or invest more than 5% of its assets in the commercial paper of any
one issuer. Notwithstanding the foregoing, to the extent required by the
rules of the Securities and Exchange Commission, the Fund will not invest
more than 5% of its assets in the obligations of any one bank.
10. Invest less than 25% of its assets in securities issued by banks
or invest more than 25% of its assets in the securities of issuers in any
other 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.
11. Invest in companies for the purpose of exercising control.
12. Invest in securities of other investment companies, except as they
may be acquired as part of a merger, consolidation or acquisition of assets.
13. 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 10% of the value of the Fund's net assets would
be so invested.
* * * * *
Government Money Fund. The Government Money Fund has adopted
investment restrictions numbered 1 through 10 as fundamental policies, which
cannot be changed without approval by the holders of a majority (as defined
in the 1940 Act) of the Fund's outstanding voting shares. Investment
restrictions numbered 11 and 12 are not fundamental policies and may be
changed by vote of a majority of the Government Money Fund's Board members
at any time. The Government Money Fund may not:
1. Purchase common stocks, preferred stocks, warrants or other equity
securities, or purchase corporate bonds or debentures, state bonds,
municipal bonds or industrial revenue bonds.
2. Borrow money, except from banks for temporary or emergency (not
leveraging) purposes in an amount up to 15% of the value of the Fund's total
assets (including the amount borrowed) based on the lesser of cost or
market, less liabilities (not including the amount borrowed) at the time the
borrowing is made. While borrowings exceed 5% of the value of the Fund's
total assets, the Fund will not make any additional investments.
3. Sell securities short or purchase securities on margin.
4. Write or purchase put or call options.
5. Underwrite the securities of other issuers.
6. Purchase or sell real estate, real estate investment trust
securities, commodities, or oil and gas interests.
7. Make loans to others (except through the purchase of debt
obligations referred to under "Description of the Funds" in the Prospectus).
8. Invest in companies for the purpose of exercising control.
9. Invest in securities of other investment companies, except as they
may be acquired as part of a merger, consolidation or acquisition of assets.
10. Invest more than 25% of its assets in the securities of issuers in
any industry, provided that there shall be no limitation on investments in
obligations issued or guaranteed as to principal and interest by the U.S.
Government.
11. Pledge, mortgage, hypothecate or otherwise encumber its assets,
except to the extent necessary to secure permitted borrowings.
12. 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 10% of the value of the Fund's net assets would
be so invested.
* * * * *
Each Fund. If a percentage restriction is adhered to at the time of
investment, a later increase or decrease in percentage resulting from a
change in values or assets will not constitute a violation of such
restriction.
Each Fund may make commitments more restrictive than the restrictions
listed above so as to permit the sale of Fund shares in certain states.
Should a Fund determine that a commitment is no longer in the best interest
of the Fund and its shareholders, the Fund reserves the right to revoke the
commitment by terminating the sale of Fund shares in the state involved.
MANAGEMENT OF THE FUNDS
Board members and officers of each Fund, together with information as
to their principal business occupations during at least the last five years,
are shown below.
Board Members of the Funds
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 63 years old and
his address is 400 C Street, N.E., Washington, D.C. 20002.
PEGGY C. DAVIS, Board Member. Shad Professor of Law, New York
University School of Law. Professor Davis has been a member of
the New York University law faculty since 1983. Prior to that
time, she served for three years as a judge in the courts of New
York State; was engaged for eight years in the practice of law,
working in both corporate and non-profit sectors; and served for
two years as a criminal justice administrator in the government of
the City of New York. She writes and teaches in the fields of
evidence, constitutional theory, family law, social sciences and
the law, legal process and professional methodology and training.
She is 54 years old and her address is c/o New York University
School of Law, 249 Sullivan Street, New York, New York 10011.
JOSEPH S. DiMARTINO, Chairman of the Board. Since January 1995, Chairman of
the Board of various funds in the Dreyfus Family of Funds. He is also
Chairman of the Board of Directors of Noel Group, Inc., a venture
capital company; and a director of The Muscular Dystrophy Association,
HealthPlan Services Corporation, Carlyle Industries, Inc. (formerly
Belding Heminway Company, Inc.), a button packager and distributor,
Curtis Industries, Inc., a national distributor of security products,
chemicals, and automotive and other hardware, and Staffing Resources,
Inc. 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 and, until August
24, 1994, the Fund's distributor. From August 1994 until December 31,
1994, he was a director of Mellon Bank Corporation. He is 53 years old
and his address is 200 Park Avenue, New York, New York 10166.
ERNEST KAFKA, Board Member. A physician engaged in private practice
specializing in the psychoanalysis of adults and adolescents. Since
1981, he has served as an Instructor at the New York Psychoanalytic
Institute and, prior thereto, held other teaching positions. He is
Associate Clinical Professor of Psychiatry at Cornell Medical School.
For more than the past five years, Dr. Kafka has held numerous
administrative positions and has published many articles on subjects in
the field of psychoanalysis. He is 64 years old and his address is 23
East 92nd Street, New York, New York 10128.
SAUL B. KLAMAN, Board Member. Chairman and Chief Executive Officer of SBK
Associates, which provides research and consulting services to
financial institutions. Dr. Klaman was President of the National
Association of Mutual Savings Banks until November 1983, President of
the National Council of Savings Institutions until June 1985, Vice
Chairman of Golembe Associates and BEI Golembe, Inc. until 1989 and
Chairman Emeritus of BEI Golembe, Inc. until November 1992. He also
served as an Economist to the Board of Governors of the Federal Reserve
System and on several Presidential Commissions, and has held numerous
consulting and advisory positions in the fields of economics and
housing finance. He is 77 years old and his address is 431-B Dedham
Street, The Gables, Newton Center, Massachusetts 02159.
NATHAN LEVENTHAL, Board Member. President of Lincoln Center for the
Performing Arts, Inc. Mr. Leventhal was Deputy Mayor for Operations of
New York City from September 1979 until March 1984 and Commissioner of
the Department of Housing Preservation and Development of New York City
from February 1978 to September 1979. Mr. Leventhal was an associate
and then a member of the New York law firm of Poletti Freidin Prashker
Feldman and Gartner from 1974 to 1978. He was Commissioner of Rent and
Housing Maintenance for New York City from 1972 to 1973. Mr. Leventhal
also serves as Chairman of Citizens Union, an organization which
strives to reform and modernize city and state government. He is 54
years old and his address is 70 Lincoln Center Plaza, New York, New
York 10023-6583.
For so long as a Fund's plan described in the sections captioned
"Service Plan and Distribution Plan" and "Shareholder Services Plan" remain
in effect, the Board members of the Fund who are not "interested persons" of
the Fund, as defined in the 1940 Act, will be selected and nominated by the
Board members who are not "interested persons" of the Fund.
Each 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 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 each Fund for the fiscal year
ended January 31, 1997, 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, 1996, were as follows:
Total
Aggregate Compensation
Compensation From Funds and
Name of Board Member from the Fund* Fund Complex
Paid
to Board
Member
Clifford L. Alexander, Jr. $5,000 $ 82,436 (17)
Government Money Fund
Money Fund
Peggy C. Davis $5,500 $ 73,084 (15)
Government Money Fund
Money Fund
Joseph S. DiMartino $6,875 $517,075 (94)
Government Money Fund
Money Fund
Ernest Kafka $5,000 $ 69,584 (15)
Government Money Fund
Money Fund
Saul B. Klaman $5,500 $ 73,584 (15)
Government Money Fund
Money Fund
Nathan Leventhal $5,500 $ 71,084 (15)
Government Money Fund
Money Fund
________________________
* Amount does not include reimbursed expenses for attending Board
meetings, which amounted to $1,015 and $597 for the Government Money
Fund and the Money Fund, respectively, for all Board members as a
group.
Officers of the Funds
MARIE E. CONNOLLY, President and Treasurer. President, Chief Executive
Officer and a director of the Distributor and an officer of other
investment companies advised or administered by the Manager. From
December 1991 to July 1994, she was President and Chief Compliance
Officer of Funds Distributor, Inc., the ultimate parent of which is
Boston Institutional Group, Inc. She is 39 years old.
JOHN E. PELLETIER, Vice President and Secretary. Senior Vice President and
General Counsel of the Distributor and an officer of other investment
companies advised or administered by the Manager. From February 1992
to July 1994, he served as Counsel for The Boston Company Advisors,
Inc. He is 32 years old.
MARY A. NELSON, Vice President and Assistant Treasurer. Vice President and
Manager of Treasury Services and Administration of 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 32 years old.
MICHAEL S. PETRUCELLI, Vice President and Assistant Treasurer. Director of
Strategic Client Initiatives for 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
Investments where he held various financial, business development and
compliance positions. He also served as Treasurer of the GE Funds and
as Director of GE Investment Services. He is 35 years old.
JOSEPH F. TOWER, III, Vice President and Assistant Treasurer. Senior Vice
President, Treasurer and Chief Financial Officer of the Distributor 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 34 years old.
DOUGLAS C. CONROY, Vice President and Assistant Secretary. Supervisor of
Treasury Services and Administration 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. From December 1991 to
March 1993, he was employed as a Fund Accountant at The Boston Company,
Inc. He is 27 years old.
RICHARD W. INGRAM, Vice President and Assistant Treasurer. Senior Vice
President and Director of Client Services and Treasury Operations of
Funds Distributor, Inc. and an officer of other investment companies
advised or administered by the Manager. From March 1994 to November
1995, he was Vice President and Division Manager for First Data
Investor Services Group. From 1989 to 1994, he was Vice President,
Assistant Treasurer and Tax Director - Mutual Funds of The Boston
Company, Inc. He is 41 years old.
MARK A. KARPE, Vice President and Assistant Secretary. Senior Paralegal of
the Distributor and an officer of other investment companies advised or
administered by the Manager. Prior to August 1993, he was employed as
an Associate Examiner at the National Association of Securities
Dealers, Inc. He is 27 years old.
ELIZABETH A. KEELEY, Vice President and Assistant Secretary. Assistant Vice
President of the Distributor since September 1995, and an officer of
other investment companies advised or administered by the Manager. She
is 27 years old.
The address of each officer of the Funds is 200 Park Avenue, New York,
New York 10166.
Each Fund's Board members and officers as a group, owned less than 1%
of the Fund's shares outstanding on May 19, 1997.
The following shareholders owned of record 5% or more of the Money
Fund's Class A shares outstanding as of May 19, 1997: Montgomery Securities,
Money Market Funds Omnibus, 600 Montgomery Street STE 4, San Francisco, CA
94111-2703 (12.7685%); and First Interstate Bank CUST, A/C Consolidated CAP
Sponsored IRA, IRA Services, Attn: Mutual Funds, P.O. Box 9800, Calabasas,
CA 91372-0800 (5.3172%).
The following shareholder owned of record 5% or more of the Money
Fund's Class B shares outstanding as of May 19, 1997: Robert W. Baird &
Co., Omnibus Account for the exclusive benefit of Customers, P.O. Box 672,
Milwaukee, WI 53201-0672 (55.6781%); and First Albany Corporation, P.O. Box
22024, Albany, NY 12201-2024 (39.4360%).
The following shareholder owned of record 5% or more of the Government
Money Fund's Class A shares outstanding as of May 19, 1997: Compass Bank,
Attn: Sharon Weaver, P.O. Box 10566, Birmingham, AL 35296 (6.7181%).
The following shareholder owned of record 5% or more of the Government
Money Fund's Class B shares outstanding as of May 19, 1997: Robert W. Baird
& Co., Omnibus Account for the exclusive benefit of Customers, P.O. Box 672,
Milwaukee, WI 53201-0672 (66.0111%); and First Albany Corporation, P.O. Box
22024, Albany, NY 12201-2024 (25.9074%).
MANAGEMENT AGREEMENTS
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus entitled "Management of the Funds."
The Manager provides management services pursuant to separate
Management Agreements (respectively, the "Agreement") dated August 24, 1994
with each Fund. As to each Fund, 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 Fund's outstanding voting securities, provided that in
either event the continuance also is approved by a majority of the Fund's
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. Each Fund's Agreement was approved
by shareholders on August 3, 1994 and 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 September 17, 1996. As
to each Fund, 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
Fund's shares or, upon not less than 90 days' notice, by the Manager. Each
Agreement will terminate automatically, as to the relevant Fund, in the
event of its assignment (as defined in the 1940 Act).
The following persons are officers and/or directors of the Manager: W.
Keith Smith, Chairman of the Board; Christopher M. Condron, President, Chief
Executive Officer, Chief Operating Officer and a director; Stephen E.
Canter, Vice Chairman, Chief Investment Officer and a director; Lawrence S.
Kash, Vice Chairman-Distribution and a director; William T. Sandalls, Jr.,
Senior Vice President and Chief Financial Officer; Mark N. Jacobs, Vice
President, General Counsel and Secretary; Patrice M. Kozlowski, Vice
President-Corporate Communications; Mary Beth Leibig, Vice President-Human
Resources; Jeffrey N. Nachman, Vice President-Mutual Fund Accounting; Andrew
S. Wasser, Vice President-Information Systems; William V. Healey, Assistant
Secretary; and Mandell L. Berman, Burton C. Borgelt and Frank V. Cahouet,
directors.
The Manager manages each Fund's portfolio of investments in accordance
with the stated policies of the Fund, subject to the approval of the Fund's
Board. The Manager is responsible for investment decisions and provides
each Fund with portfolio managers who are authorized by the Board to execute
purchases and sales of securities. Each Fund's portfolio managers are
Bernard W. Kiernan, Patricia A. Larkin and Thomas Riordan. The Manager also
maintains a research department with a professional staff of portfolio
managers and securities analysts who provide research services for each Fund
as well as for other funds advised by the Manager.
The Manager maintains office facilities on behalf of each Fund, and
furnishes statistical and research data, clerical help, accounting, data
processing, bookkeeping and internal auditing and certain other required
services to the Funds. The Manager also may make such advertising and
promotional expenditures using its own resources, as it from time to time
deems appropriate.
All expenses incurred in the operation of a Fund are borne by such
Fund, except to the extent specifically assumed by the Manager. The
expenses borne by each Fund include: taxes, interest, 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, Securities and Exchange Commission fees, state Blue Sky
qualification 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,
investor services (including, without limitation, telephone and personnel
expenses), costs of shareholder 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. Each Fund bears certain expenses in accordance with
separate written plans and also bears certain costs associated with
implementing and operating such plans. See "Service Plan and Distribution
Plan."
As compensation for the Manager's services, each Fund has agreed to pay
the Manager a monthly management fee at the annual rate of .50 of 1% of the
value of such Fund's average daily net assets. All fees and expenses are
accrued daily and deducted before payment of dividends to investors. For
the fiscal years ended January 31, 1995, 1996 and 1997, the management fees
paid by the Money Fund amounted to $2,850,622, $3,172,667, and $5,285,812,
respectively. For the fiscal years ended January 31, 1995, 1996 and 1997,
the management fees paid by the Government Money Fund amounted to
$2,624,643, $2,622,700 and $3,002,777, respectively.
As to each Fund, the Manager has agreed that if in any fiscal year the
aggregate expenses of the Fund, exclusive of taxes, brokerage, interest and
(with the prior written consent of the necessary state securities
commissions) extraordinary expenses, but including the management fee,
exceed 1-1/2% of the average market value of the net assets of such Fund for
that fiscal year, the Fund may deduct from the payment to be made to the
Manager under the Agreement, or the Manager will bear, such excess expense.
Such deduction or payment, if any, will be estimated daily and reconciled
and effected or paid, as the case may be, on a monthly basis. As to each
Fund, no such deduction or payment was required for the fiscal year ended
January 31, 1997.
As to each Fund, the aggregate of the fees payable to the Manager is
not subject to reduction as the value of the Fund's net assets increases.
PURCHASE OF SHARES
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus entitled "How to Buy Shares."
The Distributor. The Distributor serves as each Fund's distributor on
a best efforts basis pursuant to an agreement which is renewable annually.
The Distributor also acts as distributor for the other funds in the General
Family of Funds, for the funds in the Dreyfus Family of Funds and for
certain other investment companies. In some states, certain financial
institutions effecting transactions in Fund shares may be required to
register as dealers pursuant to state law.
Using Federal Funds. Dreyfus Transfer, Inc., each Fund's transfer and
dividend disbursing agent (the "Transfer Agent"), or a Fund may attempt to
notify the investor upon receipt of checks drawn on banks that are not
members of the Federal Reserve System as to the possible delay in conversion
into Federal Funds and may attempt to arrange for a better means of
transmitting the money. If the investor is a customer of a securities
dealer ("Selected Dealer") and his order to purchase Fund shares is paid for
other than in Federal Funds, the Selected Dealer, acting on behalf of its
customer, will complete the conversion into, or itself advance, Federal
Funds, generally on the business day following receipt of the customer
order. The order is effective only when so converted and received by the
Transfer Agent. An order for the purchase of Fund shares placed by an
investor with sufficient Federal Funds or a cash balance in his brokerage
account with a Selected Dealer will become effective on the day that the
order, including Federal Funds, is received by the Transfer Agent.
Reopening an Account. An investor may reopen an account with a minimum
investment of $100 without filing a new Account Application during the
calendar year the account is closed or during the following calendar year,
provided the information on the old Account Application is still applicable.
SERVICE PLAN AND DISTRIBUTION PLAN
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus relating to Class A shares entitled
"Service Plan" and in conjunction with the section of each Fund Prospectus
relating to Class B shares entitled "Distribution Plan."
Rule 12b-1 (the "Rule") adopted by the Securities and Exchange
Commission under the 1940 Act provides, among other things, that an
investment company may bear expenses of distributing its shares only
pursuant to a plan adopted in accordance with the Rule. Each Fund's Board
has adopted separate plans with respect to Class A and Class B (each a
"Plan"). Under each Plan, each respective Fund bears directly the costs of
preparing, printing and distributing prospectuses and statements of
additional information and of implementing and operating the Plan. Under
each Fund's Plan adopted with respect to Class A (the "Service Plan"), the
Fund reimburses (a) the Distributor for payments made for distributing Class
A shares and servicing shareholder accounts ("Servicing") and (b) the
Manager, Dreyfus Service Corporation and any affiliate of either of them
(collectively, "Dreyfus") for payments made for Servicing. Under each
Fund's Service Plan, each of the Distributor and Dreyfus may pay one or more
financial institutions, Selected Dealers or other industry professionals
(collectively, "Service Agents"), a fee in respect of Class A shares of the
Fund owned by shareholders with whom the Service Agent has a Servicing
relationship or for whom the Service Agent is the dealer or holder of
record. Under each Fund's Plan adopted with respect to Class B (the
"Distribution Plan"), the Fund reimburses the Distributor for payments made
to third parties for distributing (within the meaning of the Rule) Class B
shares. Each Fund's Board believes that there is a reasonable likelihood
that each Plan will benefit the Fund and holders of the relevant class of
shares.
A quarterly report of the amounts expended under each Plan, and the
purposes for which such expenditures were incurred, must be made to the
Fund's Board for its review. In addition, each Plan provides that it may
not be amended to increase materially the costs which the Fund may bear for
distribution pursuant to the Plan without shareholder approval of the
affected class and that other material amendments of the Plan must be
approved by the Board, and by the Fund's Board members who are not
"interested persons" (as defined in the 1940 Act) of the Fund or the Manager
and have no direct or indirect financial interest in the operation of the
Plan or in any related agreements entered into in connection with such Plan,
by vote cast in person at a meeting called for the purpose of considering
such amendments. Each Plan is subject to annual approval by such vote of
the Board members cast in person at a meeting called for the purpose of
voting on the Plan. Each Plan was last so approved on September 17, 1996.
Each Plan is terminable at any time by vote of a majority of the Fund's
Board members who are not "interested persons" and have no direct or
indirect financial interest in the operation of the Plan or in any of the
related agreements or by vote of a majority of the relevant class of shares.
With respect to the Money Fund's Class A shares for the fiscal year
ended January 31, 1997, the Distributor and Dreyfus paid $2,614,286 to
Service Agents for Servicing, of which $1,454,173 was reimbursed by the Fund
pursuant to the Service Plan and the Manager reimbursed the remainder. In
addition, for the fiscal year ended January 31, 1997, the Money Fund paid,
with respect to Class A $13,232 under the Service Plan for preparing,
printing and distributing prospectuses and statements of additional
information and for implementing and operating the Service Plan.
With respect to the Money Fund's Class B shares for the fiscal year
ended January 31, 1997, the Fund paid the Distributor $660,152 under the
Distribution Plan. In addition, for the fiscal year ended January 31, 1997,
the Money Fund paid, with respect to Class B, $5,945 under the Distribution
Plan for preparing, printing and distributing prospectuses and statements of
additional information and for implementing and operating the Distribution
Plan.
With respect to the Government Money Fund's Class A shares, for the
fiscal year ended January 31, 1997, the Distributor and Dreyfus paid
$1,929,512 to Service Agents for Servicing, of which $1,047,607 was
reimbursed by the Fund pursuant to the Service Plan and the Manager
reimbursed the remainder. In addition, for the fiscal year ended January
31, 1997, the Government Money Fund paid, with respect to Class A, $7,658
under the Service Plan for preparing, printing and distributing prospectuses
and statements of additional information and for implementing and operating
the Service Plan.
With respect to the Government Money Fund's Class B shares for the
fiscal year ended January 31, 1997, the Fund paid the Distributor $153,504
under the Distribution Plan. In addition, for the fiscal year ended January
31, 1997, the Government Money Fund paid, with respect to Class B, $1,144
under the Distribution Plan for preparing, printing and distributing
prospectuses and statements of additional information and for implementing
and operating the Distribution Plan.
SHAREHOLDER SERVICES PLANS
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus entitled "Shareholder Services
Plan."
Each Fund has adopted a Shareholder Services Plan with respect to Class
A pursuant to which the Fund reimburses Dreyfus Service Corporation for
certain allocated expenses of providing personal services and/or maintaining
shareholder accounts. Each Fund also has adopted a Shareholder Services
Plan with respect to Class B pursuant to which the Fund pays the Distributor
for the provision of certain services to the holders of Class B shares.
Under each Shareholder Services Plan, the services provided may include
personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the Fund and providing reports and other
information, and services related to the maintenance of shareholder
accounts. As to each Fund, under the Shareholders Services Plan for Class
B, the Distributor may make payments to Service Agents in respect of their
services.
A quarterly report of the amounts expended under each Shareholder
Services Plan, and the purposes for which such expenditures were incurred,
must be made to each Fund's Board for its review. In addition, each
Shareholder Services Plan provides that material amendments to the
Shareholder Services Plan must be approved by the Fund's Board, and by the
Board members who are not "interested persons" (as defined in the 1940 Act)
of the Fund and have no direct or indirect financial interest in the
operation of the Shareholder Services Plan by vote cast in person at a
meeting called for the purpose of considering such amendments. Each
Shareholder Services Plan is subject to annual approval by such vote of its
Board members cast in person at a meeting called for the purpose of voting
on the Shareholder Services Plan. Each Shareholder Services Plan with
respect to Class A was last so approved on September 17, 1996. Each
Shareholder Services Plan with respect to Class B was last so approved on
September 17, 1996. Each Shareholder Services Plan is terminable at any
time by vote of a majority of the Board members who are not "interested
persons" and have no direct or indirect financial interest in the operation
of the Shareholder Services Plan.
With respect to the Money Fund, for the fiscal year ended January 31,
1997, the Fund was charged $363,543 pursuant to the Shareholder Services
Plan with respect to Class A. For the same time period, the Money Fund was
charged $825,189 pursuant to the Shareholder Services Plan with respect to
Class B, of which $243,136 was reimbursed by the Manager pursuant to an
undertaking.
With respect to the Government Money Fund, for the fiscal year ended
January 31, 1997, the Fund was charged $215,006 pursuant to the Shareholder
Services Plan with respect to Class A. For the same time period, the
Government Money Fund was charged $191,880 pursuant to the Shareholder
Services Plan with respect to Class B, of which $62,819 was reimbursed by
the Manager pursuant to an undertaking.
REDEMPTION OF SHARES
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus entitled "How to Redeem Shares."
Check Redemption Privilege. An investor may indicate on the Account
Application, Shareholder Services Form or by later written request that a
Fund provide Redemption Checks ("Checks") drawn on the investor's Fund
account. Checks will be sent only to the registered owner(s) of the account
and only to the address of record. The Account Application, Shareholder
Services Form or later written request must be manually signed by the
registered owner(s). Checks may be made payable to the order of any person
in an amount of $500 or more. When a Check is presented to the Transfer
Agent for payment, the Transfer Agent, as the investor's agent, will cause
the Fund to redeem a sufficient number of full or fractional shares in the
investor's account to cover the amount of the Check. Dividends are earned
until the Check clears. After clearance, a copy of the Check will be
returned to the investor. Investors generally will be subject to the same
rules and regulations that apply to checking accounts, although the election
of this Privilege creates only a shareholder-transfer agent relationship
with the Transfer Agent.
If the amount of the Check is greater than the value of the shares in
an investor's account, the Check will be returned marked insufficient funds.
Checks should not be used to close an account.
Wire Redemption Privilege. By using this Privilege, the investor
authorizes the Transfer Agent to act on wire or telephone redemption
instructions from any person representing himself or herself to be the
investor, or a representative of the investor's Service Agent, and
reasonably believed by the Transfer Agent to be genuine. Ordinarily, each
Fund will initiate payment for shares redeemed pursuant to this Privilege on
the same business day if the Transfer Agent receives the redemption request
in proper form prior to 5:00 p.m., New York time, on such day; otherwise the
Fund will initiate payment on the next business day. Redemption proceeds
($1,000 minimum) will be transferred by Federal Reserve wire only to the
commercial bank account specified by the investor on the Account Application
or the Shareholder Services Form, or to a correspondent bank if the
investor's bank is not a member of the Federal Reserve System. Fees
ordinarily are imposed by such bank and borne by the investor. Immediate
notification by the correspondent bank to the investor's bank is necessary
to avoid a delay in crediting the funds to the investor's bank account.
Investors with access to telegraphic equipment may wire redemption
requests to the Transfer Agent by employing the following transmittal code
which may be used for domestic or overseas transmissions:
Transfer Agent's
Transmittal Code Answer Back Sign
144295 144295 TSSG PREP
Investors who do not have direct access to telegraphic equipment may
have the wire transmitted by contacting a TRT Cables operator at
1-800-654-7171, toll free. Investors also should advise the operator that
the above transmittal code must be used and also inform the operator of the
Transfer Agent's answer back sign.
To change the commercial bank or account designated to receive
redemption proceeds, a written request must be sent to the Transfer Agent.
This request must be signed by each shareholder, with each signature
guaranteed as described below under "Stock Certificates; Signatures."
Stock Certificates; Signatures. Any certificates representing Fund
shares to be redeemed must be submitted with the redemption request.
Written redemption requests must be signed by each shareholder, including
each holder of a joint account, and each signature must be guaranteed.
Signatures on endorsed certificates submitted for redemption also must be
guaranteed. The Transfer Agent has adopted standards and procedures
pursuant to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations, as well as from participants in the New York Stock
Exchange Medallion Signature Program, the Securities Transfer Agents
Medallion Program ("STAMP"), and the Stock Exchanges Medallion Program.
Guarantees must be signed by an authorized signatory of the guarantor and
"Signature-Guaranteed" must appear with the signature. The Transfer Agent
may request additional documentation from corporations, executors,
administrators, trustees or guardians, and may accept other suitable
verification arrangements from foreign investors, such as consular
verification. For more information with respect to signature-guarantees,
please call one of the telephone numbers listed on the cover.
Redemption Commitment. Each Fund has committed itself 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 the
Fund's net assets at the beginning of such period. Such commitment is
irrevocable without the prior approval of the Securities and Exchange
Commission. In the case of requests for redemption in excess of such
amount, each Fund's Board reserves the right to make payments in whole or in
part in securities (which may include non-marketable securities) or other
assets of the Fund in case of an emergency or any time a cash distribution
would impair the liquidity of the Fund to the detriment of the existing
shareholders. In such event, the securities would be valued in the same
manner as the Fund's portfolio is 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 a Fund ordinarily utilizes is restricted, or
when an emergency exists as determined by the Securities and Exchange
Commission so that disposal of a 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 a
Fund's shareholders.
SHAREHOLDER SERVICES
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus entitled "Shareholder Services."
Fund Exchanges. Shares of other funds purchased by exchange will be
purchased on the basis of relative net asset value per share as follows:
A. Exchanges for shares of funds that are offered without a
sales load will be made without a sales load.
B. Shares of funds purchased without a sales load may be
exchanged for shares of other funds sold with a sales load, and
the applicable sales load will be deducted.
C. Shares of funds purchased with a sales load may be exchanged
for shares of other funds sold without a sales load.
D. Shares of funds purchased with a sales load, shares of funds
acquired by a previous exchange from shares purchased with a sales
load, and additional shares acquired through reinvestment of
dividends or distributions of any such funds (collectively
referred to herein as "Purchased Shares") may be exchanged for
shares of other funds sold with a sales load (referred to herein
as "Offered Shares"), provided that, if the sales load applicable
to the Offered Shares exceeds the maximum sales load that could
have been imposed in connection with the Purchased Shares (at the
time the Purchased Shares were acquired), without giving effect to
any reduced loads, the difference will be deducted.
To accomplish an exchange under item D above, shareholders must notify
the Transfer Agent of their prior ownership of fund shares and their account
number.
To request an exchange, an investor, or an investor's Service Agent
acting on the investor's behalf, must give exchange instructions to the
Transfer Agent in writing or by telephone. The ability to issue exchange
instructions by telephone is given to all Fund shareholders automatically,
unless the investor checks the applicable "No" box on the Account
Application, indicating that the investor specifically refuses this
Privilege. By using the Telephone Exchange Privilege, the investor
authorizes the Transfer Agent to act on telephonic instructions from any
person representing himself or herself to be the investor or a
representative of the investor's Service Agent, and reasonably believed by
the Transfer Agent to be genuine. Telephone exchanges may be subject to
limitations as to the amount involved or the number of telephone exchanges
permitted. Shares issued in certificate form are not eligible for telephone
exchanges.
To establish a personal retirement plan by exchange, shares of the fund
being exchanged must have a value of at least the minimum initial investment
required for the fund into which the exchange is being made. For
Dreyfus-sponsored Keogh Plans, IRAs and IRAs set up under a Simplified
Employee Pension Plan ("SEP-IRAs") with only one participant, the minimum
initial investment is $750. To exchange shares held in corporate plans,
403(b)(7) Plans and SEP-IRAs with more than one participant, the minimum
initial investment is $100 if the plan has at least $2,500 invested among
the funds in the Dreyfus Family of Funds. To exchange shares held in
personal retirement plans, the shares exchanged must have a current value of
at least $100.
Auto-Exchange Privilege. The Auto-Exchange Privilege permits an
investor to purchase, in exchange for shares of a Fund, shares of certain
other funds in the Dreyfus Family of Funds. This Privilege is available
only for existing accounts. Shares will be exchanged on the basis of
relative net asset value as described above under "Fund Exchanges."
Enrollment in or modification or cancellation of this Privilege is effective
three business days following notification by the investor. An investor
will be notified if his account falls below the amount designated to be
exchanged under this Privilege. In this case, an investor's account will
fall to zero unless additional investments are made in excess of the
designated amount prior to the next Auto-Exchange transaction. Shares held
under IRA and other retirement plans are eligible for this Privilege.
Exchanges of IRA shares may be made between IRA accounts and from regular
accounts to IRA accounts, but not from IRA accounts to regular accounts.
With respect to all other retirement accounts, exchanges may be made only
among those accounts.
Fund Exchanges and the Auto-Exchange Privilege are available to
shareholders resident in any state in which shares of the fund being
acquired legally may be sold. Shares may be exchanged only between accounts
having identical names and other identifying designations.
Shareholder Services Forms and prospectuses of the other funds may be
obtained by calling 1-800-645-6561. Each Fund reserves the right to reject
any exchange request in whole or in part. The Fund Exchanges service or the
Auto-Exchange Privilege may be modified or terminated at any time upon
notice to shareholders.
Automatic Withdrawal Plan. The Automatic Withdrawal Plan permits an
investor with a $5,000 minimum account to request withdrawal of a specified
dollar amount (minimum of $50) on either a monthly or quarterly basis.
Withdrawal payments are the proceeds from sales of Fund shares, not the
yield on the shares. If withdrawal payments exceed reinvested dividends and
distributions, the investor's shares will be reduced and eventually may be
depleted. Automatic Withdrawal may be terminated at any time by the
investor, the Fund or the Transfer Agent. Shares for which certificates
have been issued may not be redeemed through the Automatic Withdrawal Plan.
Dividend Sweep. Dividend Sweep allows investors to invest
automatically their dividends or dividends and capital gain distributions,
if any, from a Fund in shares of another fund in the Dreyfus Family of Funds
of which the investor is a shareholder. Shares of other funds purchased
pursuant to this privilege will be purchased on the basis of relative net
asset value per share as follows:
A. Dividends and distributions paid by a fund may be
invested without imposition of a sales load in shares of
other funds that are offered without a sales load.
B. Dividends and distributions paid by a fund which
does not charge a sales load may be invested in shares
of other funds sold with a sales load, and the
applicable sales load will be deducted.
C. Dividends and distributions paid by a fund which
charges a sales load may be invested in shares of other
funds sold with a sales load (referred to herein as
"Offered Shares"), provided that, if the sales load
applicable to the Offered Shares exceeds the maximum
sales load charged by the fund from which dividends or
distributions are being swept, without giving effect to
any reduced loads, the difference will be deducted.
D. Dividends and distributions paid by a fund may be
invested in shares of other funds that impose a
contingent deferred sales charge ("CDSC") and the
applicable CDSC, if any, will be imposed upon redemption
of such shares.
Corporate Pension/Profit-Sharing and Personal Retirement Plans. Each
Fund makes available to corporations a variety of prototype pension and
profit-sharing plans, including a 401(k) Salary Reduction Plan. In
addition, each Fund makes available Keogh Plans, IRAs, including SEP-IRAs
and IRA "Rollover Accounts," and 403(b)(7) Plans. Plan support services
also are available. Investors can obtain details on the various plans by
calling the following numbers toll free: for Keogh Plans, please call 1-800-
358-5566; for IRAs and IRA "Rollover Accounts," please call 1-800-645-6561;
or for SEP-IRAs, 401(k) Salary Reduction Plan, and 403(b)(7) Plans, please
call 1-800-322-7880.
Investors who wish to purchase Fund shares in conjunction with a Keogh
Plan, a 403(b)(7) Plan or an IRA, including a SEP-IRA, may request from the
Distributor forms for adoption of such plans.
The entity acting as custodian for Keogh Plans, 403(b)(7) Plans or IRAs
may charge a fee, payment of which could require the liquidation of shares.
All fees charged are described in the appropriate form.
Shares may be purchased in connection with these plans only by direct
remittance to the entity which acts as custodian. Such purchases will be
effective when payments received by the Transfer Agent are converted into
Federal Funds. Purchases for these plans may not be made in advance of
receipt of funds.
The minimum initial investment for corporate plans, salary reduction
plans, 403(b)(7) Plans and SEP-IRAs, with more than one participant, is
$2,500, with no minimum on subsequent purchases. The minimum initial
investment for Dreyfus-sponsored Keogh Plans, IRAs, SEP-IRAs and 403(b)(7)
Plans, with only one participant, is normally $750, with no minimum on
subsequent purchases. Individuals who open an IRA also may open a
non-working spousal IRA with a minimum investment of $250.
The investor should read the prototype retirement plans and the
applicable form of custodial agreement for further details as to
eligibility, service fees and tax implications, and should consult a tax
adviser.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus entitled "How to Buy Shares."
Amortized Cost Pricing. The valuation of each Fund's portfolio
securities is based upon their amortized cost, which does not take into
account unrealized capital gains or losses. This involves valuing an
instrument at its cost and thereafter assuming a constant amortization to
maturity of any discount or premium, regardless of the impact of fluctuating
interest rates on the market value of the instrument. While this method
provides certainty in valuation, it may result in periods during which
value, as determined by amortized cost, is higher or lower than the price
the Fund would receive if it sold the instrument.
Each Fund's Board has established, as a particular responsibility
within the overall duty of care owed to the Fund's shareholders, procedures
reasonably designed to stabilize the Fund's price per share as computed for
the purpose of purchases and redemptions at $1.00. Such procedures include
review of the Fund's portfolio holdings by the Board, at such intervals as
it may deem appropriate, to determine whether the Fund's net asset value
calculated by using available market quotations or market equivalents
deviates from $1.00 per share based on amortized cost. In such review,
investments for which market quotations are readily available will be valued
at the most recent bid price or yield equivalent for such securities or for
securities of comparable maturity, quality and type as obtained from one or
more of the major market makers for the securities to be valued. Other
investments and assets will be valued at fair value as determined in good
faith by the Board.
The extent of any deviation between a Fund's net asset value based upon
available market quotations or market equivalents and $1.00 per share based
on amortized cost will be examined by the Fund's Board. If such deviation
exceeds 1/2 of 1%, the Board promptly will consider what action, if any,
will be initiated. In the event a Fund's Board determines that a deviation
exists which may result in material dilution or other unfair results to
investors or existing shareholders, it has agreed to take such corrective
action as it regards as necessary and appropriate, including: selling
portfolio instruments prior to maturity to realize capital gains or losses
or to shorten average portfolio maturity; withholding dividends or paying
distributions from capital or capital gains; redeeming shares in kind; or
establishing a net asset value per share by using available market
quotations or market equivalents.
New York Stock Exchange and Transfer Agent Closings. The holidays (as
observed) on which both the New York Stock Exchange and the Transfer Agent
are closed currently are: New Year's Day, Presidents' Day, Memorial Day,
Independence Day, Labor Day, Thanksgiving and Christmas.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus entitled "Dividends, Distributions
and Taxes."
Ordinarily, gains and losses realized from portfolio transactions will
be treated as capital gain or loss. However, all or a portion of any gain
realized from the sale or other disposition of certain market discount bonds
will be treated as ordinary income under Section 1276 of the Internal
Revenue Code of 1986, as amended.
YIELD INFORMATION
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus entitled "Yield Information."
For the seven-day period ended January 31, 1997, the yield and
effective yield for Class A and Class B shares of each Fund were as follows:
NAME OF FUND AND CLASS YIELD EFFECTIVE YIELD
Government Money Fund
Class A 4.61% 4.72%
Class B 4.45%/4.33%* 4.55%/4.42%*
Money Fund
Class A 4.71% 4.82%
Class B 4.58%/4.50%* 4.68%/4.60%*
________________
* Net of absorbed expenses.
Yield is computed in accordance with a standardized method which involves
determining the net change in the value of a hypothetical pre-existing Fund
account having a balance of one share at the beginning of a seven calendar
day period for which yield is to be quoted, dividing the net change by the
value of the account at the beginning of the period to obtain the base
period return, and annualizing the results (i.e., multiplying the base
period return by 365/7). The net change in the value of the account
reflects the value of additional shares purchased with dividends declared on
the original share and any such additional shares and fees that may be
charged to shareholder accounts, in proportion to the length of the base
period and the Fund's average account size, but does not include realized
gains and losses or unrealized appreciation and depreciation. Effective
yield is computed by adding 1 to the base period return (calculated as
described above), raising that sum to a power equal to 365 divided by 7, and
subtracting 1 from the result.
Yields will fluctuate and are not necessarily representative of future
results. Each investor should remember that yield is a function of the type
and quality of the instruments in the portfolio, portfolio maturity and
operating expenses. An investor's principal in either Fund is not
guaranteed. See "Determination of Net Asset Value" for a discussion of the
manner in which each Fund's price per share is determined.
PORTFOLIO TRANSACTIONS
Portfolio securities ordinarily are purchased directly from the issuer
or from an underwriter or a market maker for the securities. Usually no
brokerage commissions are paid by a Fund for such purchases. Purchases from
underwriters of portfolio securities include a concession paid by the issuer
to the underwriter and the purchase price paid to market makers for the
securities may include the spread between the bid and asked price. No
brokerage commissions have been paid by either Fund to date.
Transactions are allocated to various dealers by the portfolio managers
of a Fund 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 to supplement its own research and
analysis with the views and information of other securities firms and may be
selected based upon their sales of Fund shares.
Research services furnished by brokers through which a Fund effects
securities transactions may be used by the Manager in advising other funds
it advises and, conversely, research services furnished to the Manager by
brokers in connection with other funds the Manager advises may be used by
the Manager in advising the Fund. 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 expenses of
its research department.
INFORMATION ABOUT THE FUNDS
The following information supplements and should be read in conjunction
with the section of each Fund Prospectus entitled "General Information."
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and non-assessable.
Fund shares have equal rights as to dividends and in liquidation. Shares
have no preemptive, subscription or conversion rights and are freely
transferable.
Each Fund sends annual and semi-annual financial statements to all its
share-
holders.
TRANSFER AND DIVIDEND DISBURSING AGENT, CUSTODIAN,
COUNSEL AND INDEPENDENT AUDITORS
Dreyfus Transfer, Inc., a wholly-owned subsidiary of the Manager, P.O.
Box 9671, Providence, Rhode Island 02940-9671, is each Fund's transfer and
dividend disbursing agent. Under a separate Transfer Agency Agreement with
each 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 from each Fund computed on the basis of the number of
shareholder accounts it maintains for such Fund during the month, and is
reimbursed for certain out-of-pocket expenses. For the fiscal year ended
January 31, 1997, the Money Fund paid the Transfer Agent $213,208 and the
Government Money Fund paid the Transfer Agent $58,897.
The Bank of New York, 90 Washington Street, New York, New York 10286 is
each Fund's custodian.
Neither the Transfer Agent nor The Bank of New York have any part in
determining the investment policies of a Fund or which securities are to be
purchased or sold by a Fund.
Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New York, New York
10082-4925, as counsel for each 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 Funds' Prospectus.
Ernst & Young LLP, 787 Seventh Avenue, New York, New York 10019,
independent auditors, have been selected as auditors of each Fund.
APPENDIX
(MONEY FUND ONLY)
Description of the two highest commercial paper, bond and other short-
and long-term rating categories assigned by Standard & Poor's Ratings Group
("S&P"), Moody's Investors Service, Inc. ("Moody's"), Fitch Investors
Service, L.P. ("Fitch"), Duff & Phelps Credit Rating Co. ("Duff"), IBCA
Limited and IBCA Inc. ("IBCA") and Thomson BankWatch, Inc. ("BankWatch"):
Commercial Paper and Short-Term Ratings
The designation A-1 by S&P indicates that 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. Capacity for timely payment on issues
with an A-2 designation is strong. However, the relative degree of safety
is not as high as for issues designated A-1.
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 of 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. Issues 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.
The rating Fitch-1 (Highest Grade) is the highest commercial paper
rating assigned by Fitch. Paper rated Fitch-1 is regarded as having the
strongest degree of assurance for timely payment. The rating Fitch-2 (Very
Good Grade) is the second highest commercial paper rating assigned by Fitch
which reflects an assurance of timely payment only slightly less in degree
than the strongest issues.
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. Paper rated Duff-2 is regarded
as having good certainty of timely payment, good access to capital markets
and sound liquidity factors and company fundamentals. Risk factors are
small.
The designation A1 by IBCA indicates that the obligation is supported
by a very strong capacity for timely repayment. Those obligations rated A1+
are supported by the highest capacity for timely repayment. Obligations
rated A2 are supported by a strong capacity for timely repayment, although
such capacity may be susceptible to adverse changes in business, economic,
or financial conditions.
The rating TBW-1 is the highest short-term obligation rating assigned
by BankWatch. Obligations rated TBW-1 are regarded as having the strongest
capacity for timely repayment. Obligations rated TBW-2 are supported by a
strong capacity for timely repayment, although the degree of safety is not
as high as for issues rated TBW-1.
Bond and Long-Term Ratings
Bonds rated AAA are considered by S&P to be the highest grade
obligations and possess an extremely strong capacity to pay principal and
interest. Bonds rated AA by S&P are judged by S&P to have a very strong
capacity to pay principal and interest and, in the majority of instances,
differ only in small degrees from issues rated AAA. The rating AA may be
modified by the addition of a plus or minus sign to show relative standing
within the rating category.
Bonds rated Aaa by Moody's are judged to be of the best quality. Bonds
rated Aa by Moody's are judged by Moody's to be of high quality by all
standards and, together with the Aaa group they comprise what are generally
known as high-grade bonds. Bonds rated Aa are rated lower than Aaa bonds
because margins of protection may not be as large or fluctuations of
protective elements may be of greater amplitude or there may be other
elements present which make the long-term risks appear somewhat larger.
Moody's applies numerical modifiers 1, 2 and 3 in the Aa rating category.
The modifier 1 indicates a ranking for the security in the higher end of
this rating category, the modifier 2 indicates a mid-range ranking, and the
modifier 3 indicates a ranking in the lower end of the rating category.
Bonds rated AAA by Fitch are judged by Fitch to be strictly high grade,
broadly marketable, suitable for investment by trustees and fiduciary
institutions and liable to slight market fluctuation other than through
changes in the money rate. The prime feature of an AAA bond is a showing of
earnings several times or many times interest requirements, with such
stability of applicable earnings that safety is beyond reasonable question
whatever changes occur in conditions. Bonds rated AA by Fitch are judged by
Fitch to be of safety virtually beyond question and are readily salable,
whose merits are not unlike those of the AAA class, but whose margin of
safety is less strikingly broad. The issue may be the obligation of a small
company, strongly secured but influenced as to rating by the lesser
financial power of the enterprise and more local type of market.
Bonds rated AAA by Duff are considered to be of the highest credit
quality. The risk factors are negligible, being only slightly more than
U.S. Treasury debt. Bonds rated AA are considered by Duff to be of high
credit quality with strong protection factors. Risk is modest but may vary
slightly from time to time because of economic conditions.
Obligations rated AAA by IBCA have the lowest expectation of investment
risk. Capacity for timely repayment of principal and interest is
substantial, such that adverse changes in business, economic or financial
conditions are unlikely to increase investment risk significantly.
Obligations rated AA by IBCA have a very low expectation of investment risk.
Capacity for timely repayment of principal and interest is substantial.
Adverse changes in business, economic or financial conditions may increase
investment risk albeit not very significantly.
IBCA also assigns a rating to certain international and U.S. banks. An
IBCA bank rating represents IBCA's current assessment of the strength of the
bank and whether such bank would receive support should it experience
difficulties. In its assessment of a bank, IBCA uses a dual rating system
comprised of Legal Ratings and Individual Ratings. In addition, IBCA
assigns banks Long- and Short-Term Ratings as used in the corporate ratings
discussed above. Legal Ratings, which range in gradation from 1 through 5,
address the question of whether the bank would receive support from central
banks or shareholders if it experienced difficulties, and such ratings are
considered by IBCA to be a prime factor in its assessment of credit risk.
Individual Ratings, which range in gradations from A through E, represent
IBCA's assessment of a bank's economic merits and address the question of
how the bank would be viewed if it were entirely independent and could not
rely on support from state authorities or its owners.
In addition to ratings of short-term obligations, BankWatch assigns a
rating to each issuer it rates, in gradations of A through E. BankWatch
examines all segments of the organization including, where applicable, the
holding company, member banks or associations, and other subsidiaries. In
those instances where financial disclosure is incomplete or untimely, a
qualified rating (QR) is assigned to the institution. BankWatch also
assigns, in the case of foreign banks, a country rating which represents an
assessment of the overall political and economic stability of the country in
which the bank is domiciled.
FINANCIAL STATEMENTS AND REPORTS OF INDEPENDENT AUDITOR:
The financial statements and reports of independent auditors with respect to
General Government Securities Money Market Fund, Inc. and General Money
Market Fund, Inc., each dated January 31, 1997, are incorporated by
reference into this Statement of Additional Information dated June 1, 1997.
When requesting a copy of this Statement of Additional Information, you will
receive the annual report for the Fund(s) in which you are a shareholder.
