DREYFUS 100% U.S. TREASURY SHORT TERM FUND
DREYFUS 100% U.S. TREASURY INTERMEDIATE TERM FUND
DREYFUS 100% U.S. TREASURY LONG TERM FUND
----------------------------------------------------
NOTICE OF SPECIAL MEETINGS OF STOCKHOLDERS
----------------------------------------------------
To the Stockholders:
A Special Meeting of Stockholders of each of Dreyfus 100% U.S. Treasury
Short Term Fund, Dreyfus 100% U.S. Treasury Intermediate Term Fund and Dreyfus
100% U.S. Treasury Long Term Fund (each, a "Fund" and, collectively, the
"Funds") will be held at the offices of The Dreyfus Corporation, 200 Park
Avenue, 7th Floor West, Room 7G, New York, New York, on Wednesday, April 15,
1998 at 3:00 p.m., for the following purposes:
1. To approve changes to certain of each Fund's investment
restrictions.
2. To transact such other business as may properly come before the
meeting, or any adjournment or adjournments thereof.
Stockholders of record at the close of business on February 19, 1998 will
be entitled to receive notice of and to vote at their Fund's meeting.
By Order of the Board
Marie E. Connolly
President
New York, New York
February 20, 1998
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WE NEED YOUR PROXY VOTE IMMEDIATELY
A STOCKHOLDER MAY THINK HIS OR HER VOTE IS NOT IMPORTANT, BUT IT IS
VITAL. BY LAW, THE MEETING OF STOCKHOLDERS OF EACH FUND WILL HAVE TO BE
ADJOURNED WITHOUT CONDUCTING ANY BUSINESS IF LESS THAN A QUORUM IS
REPRESENTED. IN THAT EVENT, THE FUND WOULD CONTINUE TO SOLICIT VOTES IN
AN ATTEMPT TO ACHIEVE A QUORUM. CLEARLY, YOUR VOTE COULD BE CRITICAL TO
ENABLE YOUR FUND TO HOLD THE MEETING AS SCHEDULED, SO PLEASE RETURN YOUR
PROXY CARD(S) IMMEDIATELY. YOU AND ALL OTHER STOCKHOLDERS WILL BENEFIT
FROM YOUR COOPERATION.
- ----------------------------------------------------------------------------
DREYFUS 100% U.S. TREASURY SHORT TERM FUND
DREYFUS 100% U.S. TREASURY INTERMEDIATE TERM FUND
DREYFUS 100% U.S. TREASURY LONG TERM FUND
COMBINED PROXY STATEMENT
-------------------------------------------------
SPECIAL MEETINGS OF STOCKHOLDERS
TO BE HELD ON WEDNESDAY, APRIL 15, 1998
This proxy statement is furnished in connection with a solicitation of
proxies by the Board of each of Dreyfus 100% U.S. Treasury Short Term Fund,
Dreyfus 100% U.S. Treasury Intermediate Term Fund and Dreyfus 100% U.S. Treasury
Long Term Fund (each, a "Fund" and, collectively, the "Funds") to be used at the
Special Meeting of Stockholders (the "Meeting") of each Fund to be held on
Wednesday, April 15, 1998 at 3:00 p.m., at the offices of The Dreyfus
Corporation, 200 Park Avenue, 7th Floor West, New York, New York, for the
purposes set forth in the accompanying Notice of Special Meetings of
Stockholders. Stockholders of record at the close of business on February 19,
1998 are entitled to receive notice of and to vote at the Meeting. Stockholders
are entitled to one vote for each Fund share held and fractional votes for each
fractional Fund share held. Stockholders can vote only on matters affecting the
Fund(s) of which they are stockholders. Shares represented by executed and
unrevoked proxies will be voted in accordance with the specifications made
thereon. If the enclosed form of proxy is executed and returned, it nevertheless
may be revoked by another proxy or by letter or telegram directed to the
relevant Fund, which must indicate the stockholder's name and account number. To
be effective, such revocation must be received before the Meeting. In addition,
any stockholder who attends the Meeting in person may vote by ballot at the
Meeting, thereby canceling any proxy previously given. As of January 30, 1998,
the Funds had the following number of shares of common stock issued and
outstanding:
NUMBER OF SHARES
FUND OUTSTANDING
- --- ------------------
Dreyfus 100% U.S. Treasury Short Term Fund 12,992,121
Dreyfus 100% U.S. Treasury Intermediate Term Fund 14,881,177
Dreyfus 100% U.S. Treasury Long Term Fund 8,837,458
It is estimated that proxy materials will be mailed to stockholders of
record on or about February 23, 1998. The principal executive offices of each
Fund are located at 200 Park Avenue, New York, New York 10166. COPIES OF EACH
FUND'S MOST RECENT ANNUAL AND SEMI-ANNUAL REPORTS ARE AVAILABLE UPON REQUEST,
WITHOUT CHARGE, BY WRITING TO THE FUND AT 144 GLENN CURTISS BOULEVARD,
UNIONDALE, NEW YORK 11556-0144, OR BY CALLING TOLL FREE 1-800-645-6561.
<PAGE>
Stockholders of each Fund will vote as a single class and will vote
separately on each proposal on which stockholders of that Fund are entitled to
vote. If a proposal is approved by stockholders of one Fund and disapproved by
stockholders of any other Fund, the proposal will be implemented only for the
Fund that approved the proposal. Therefore, it is essential that stockholders
who own shares in more than one Fund complete, date, sign and return EACH proxy
card they receive.
PROPOSAL TO CHANGE CERTAIN OF EACH FUND'S
INVESTMENT RESTRICTIONS
INTRODUCTION
Each Fund's investment objective is to provide investors with as high a
level of current income as is consistent with the preservation of capital. Each
Fund currently seeks to achieve its investment objective by investing only in
U.S. Treasury securities the interest from which would not subject stockholders
to state or local income tax.
This Proposal does not involve any change to a Fund's investment objective.
Management believes, however, that each Fund's assets may be invested more
effectively if the Fund were permitted to invest a portion of its assets in
other securities issued or guaranteed by the U.S. Government or its agencies or
instrumentalities, enter into repurchase agreements, engage in options and
futures transactions and lend portfolio securities, as described below.
Dividends paid by a Fund attributable to income or gain derived from certain of
these securities transactions may be subject to Federal income tax and to state
and local taxes in certain states. The Funds' principal competitors have the
power to enter into some or all of such transactions.
Management believes that in a rapidly changing market it is important for
the Funds to have the flexibility to purchase U.S. Government or agency
securities other than U.S. Treasury securities and engage in these transactions
because while under certain market conditions U.S. Treasury securities may be
deemed most appropriate for purchase by the Fund, under other market conditions
such other types of instruments and investment techniques may be deemed
preferable. By expanding the universe of securities the Fund may purchase and
the investment techniques in which a Fund may engage as noted above, the Fund's
management will be given the opportunity to adjust the Fund's portfolio from
time to time in such manner as it then deems appropriate. These securities and
investment techniques are described below and in the Appendix to this proxy
statement.
This Proposal involves changing each Fund's management policies and certain
investment restrictions which are fundamental policies that 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
shares. In addition, management believes it is appropriate to change the
investment restriction prohibiting short selling from a fundamental policy to a
non-fundamental policy, as described below, which may be changed by vote of the
Fund's Board members at any time. None of the Funds has any current intention to
sell securities short.
The 1940 Act requires that a relatively limited number of investment
policies and restrictions be designated as fundamental policies which may not be
changed without stockholder approval. These policies relate to (a) the
classification and subclassification under the 1940 Act within which the Fund
may operate, (b) borrowing money, (c) issuing senior securities, (d) engaging in
the business of underwriting securities issued by other persons,
(e) concentrating investments in a particular industry or group of industries,
(f) purchasing and selling real estate or commodities, (g) making loans to other
persons, and (h) changing the nature of the business so as to cease to be an
investment company. When each Fund was formed, its Board designated a number of
other policies as fundamental, in large part in response to certain regulatory
requirements or business or industry conditions that no longer exist, and
adopted certain restrictions which now are believed to be unduly restrictive.
To enable each Fund to purchase other securities issued or guaranteed by
the U.S. Government or its agencies or instrumentalities and engage in such
transactions, the Fund's Board, at a meeting held on January 12, 1998,
unanimously approved changes in the Fund's investment restrictions and directed
that this Proposal be submitted to stockholders for their approval. In addition,
Dreyfus 100% U.S. Treasury Intermediate Term Fund's Board approved an increase
in the Fund's maximum dollar-weighted average portfolio maturity from 7 years to
10 years; stockholder approval is not required for such change. Stockholder
approval also is not required to permit the Funds to purchase other securities
issued or guaranteed by the U.S. Government or its agencies or
instrumentalities, and each Fund intends to invest a portion of its assets in
such securities whether or not the Proposal is approved by stockholders. These
securities bear fixed, floating or variable rates of interest. 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. Pursuant to the
requirements of the 1940 Act, these changes also require deleting the term
"100%" from each Fund's name.
CHANGES TO MANAGEMENT POLICIES
If this Proposal is approved, each Fund will invest at least 65% of its net
assets in U.S. Treasury securities. Each Fund reserves the right to increase
such percentage without stockholder approval to the extent required by rule or
regulation of the Securities and Exchange Commission. In addition to purchasing
other securities issued or guaranteed by the U.S. Government and its agencies or
instrumentalities, each Fund also would be permitted to enter into repurchase
agreements, engage in options and futures transactions and lend portfolio
securities, as described below. Stockholder approval for such changes to the
Fund's management policies will be sought by a separate vote as set forth in the
proxy card accompanying this proxy statement. FOR A MORE DETAILED DISCUSSION OF
REPURCHASE AGREEMENTS, OPTIONS AND FUTURES TRANSACTIONS AND LENDING PORTFOLIO
SECURITIES, AND THEIR RELATED RISKS, SEE THE APPENDIX TO THIS PROXY STATEMENT.
* REPURCHASE AGREEMENTS. Each Fund would be permitted to enter into
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. The staff of the
Securities and Exchange Commission considers repurchase agreements to be loans
by the Fund. 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.
The Fund would be permitted to enter into repurchase agreements with certain
banks or non-bank dealers.
* OPTIONS AND FUTURES TRANSACTIONS. Each Fund would be permitted to
purchase and write (i.e., sell) call or put options. Each such Fund also would
be permitted to enter into futures contracts and options on futures contracts.
The principal reason for writing options is to realize income in the form of
premiums. A Fund would purchase options and enter into futures transactions
principally for hedging purposes, including to establish a temporary substitute
for purchasing or selling particular securities, to manage the effective
maturity or duration of the Fund and to maintain liquidity while simulating full
investment by the Fund.
* LENDING PORTFOLIO SECURITIES. To increase its income, each Fund would be
permitted to lend securities from its portfolio to brokers, dealers and other
financial institutions needing to borrow securities to complete certain
transactions.
CORRESPONDING CHANGES IN INVESTMENT RESTRICTIONS
If this Proposal is approved by stockholders, each Fund's current
Investment Restrictions will be revised to the extent necessary to reflect the
Fund's proposed management policies described in this proxy statement, and
generally to clarify the extent to which the Fund may invest in certain types of
securities or engage in various investment techniques. For example, with respect
to each Fund, Investment Restrictions numbered 1, 4, 5, 9 (to be renumbered 6)
and 10 (to be renumbered 7) would be revised to permit the Fund to engage in
options and futures transactions. Investment Restriction number 3 would be
revised to permit each Fund to enter into repurchase agreements and lend
portfolio securities. In addition, each Fund's Board intends to delete current
Investment Restriction number 6, which is a non-fundamental policy that
prohibits the Fund from purchasing securities other than those believed at the
time of purchase to provide the holders thereof with interest income exempt from
state and local income taxes.
Other proposed changes include designating the prohibition on short sales
set forth in Investment Restriction number 1, as a non-fundamental policy, and
revising Investment Restriction number 2 to provide an exception to the extent
the Fund may be deemed an underwriter by virtue of disposing of portfolio
securities. Without the revision to Investment Restriction number 2, the Fund
could be unnecessarily restricted in its ability to dispose of certain portfolio
securities. In addition, Investment Restriction number 5 would be revised to
clarify that the Fund may invest in securities secured by real estate or issued
by companies that invest or deal in real estate or acquire real estate as a
result of such investment.
If approved by stockholders, each Fund's Investment Restrictions would
read as follows (new language is underscored and language to be deleted is in
brackets):
The Fund may not:
1. [Sell securities short or] Purchase securities on margin, BUT THE FUND
MAY MAKE MARGIN DEPOSITS IN CONNECTION WITH TRANSACTIONS IN OPTIONS, FORWARD
CONTRACTS, FUTURES CONTRACTS, INCLUDING THOSE RELATED TO INDEXES, AND OPTIONS ON
FUTURES CONTRACTS OR INDEXES [or write or purchase put or call options or
combinations thereof].
2. Underwrite the securities of other issuers, EXCEPT TO THE EXTENT THE
FUND MAY BE DEEMED AN UNDERWRITER UNDER THE SECURITIES ACT OF 1933, AS AMENDED,
BY VIRTUE OF DISPOSING OF PORTFOLIO SECURITIES, or purchase securities subject
to restrictions on disposition under the Securities Act of 1933, AS AMENDED (so-
called "restricted securities").
3. Make loans to others, except through the purchase of debt obligations
referred to in the Prospectus OR THE ENTRY INTO REPURCHASE AGREEMENTS. HOWEVER,
THE FUND MAY LEND ITS PORTFOLIO SECURITIES TO THE EXTENT PERMITTED UNDER THE
1940 ACT (WHICH CURRENTLY PERMITS LENDING PORTFOLIO SECURITIES IN AN AMOUNT NOT
TO EXCEED 33-1/3% OF THE VALUE OF THE FUND'S TOTAL ASSETS). ANY LOANS OF
PORTFOLIO SECURITIES WILL BE MADE ACCORDING TO GUIDELINES ESTABLISHED BY THE
SECURITIES AND EXCHANGE COMMISSION AND THE FUND'S BOARD.
4. Issue any senior security (as such term is defined in Section 18(f) of
the 1940 Act), except to the extent THAT THE ACTIVITIES PERMITTED IN INVESTMENT
RESTRICTION NOS. 5, 9 AND 10 MAY BE DEEMED TO GIVE RISE TO A SENIOR SECURITY
[permitted under the 1940 Act].
5. Purchase or sell real estate, real estate investment trust securities,
commodities, or oil and gas interests, PROVIDED THAT THE FUND MAY PURCHASE AND
SELL SECURITIES THAT ARE SECURED BY REAL ESTATE OR ISSUED BY COMPANIES THAT
INVEST OR DEAL IN REAL ESTATE OR ACQUIRE REAL ESTATE AS A RESULT OF OWNERSHIP OF
SUCH SECURITIES OR INSTRUMENTS, AND PROVIDED FURTHER THAT THE FUND MAY PURCHASE
AND SELL OPTIONS, FORWARD CONTRACTS, FUTURES CONTRACTS, INCLUDING THOSE RELATING
TO INDEXES, AND OPTIONS ON FUTURES CONTRACTS OR INDEXES.
[6.Purchase securities other than those believed at the time of purchase to
provide the holder thereof with interest income exempt from state and local
income taxes.]
6[9]. Borrow money, except to the extent permitted under the 1940 Act
(which currently limits borrowing to no more than 33-1/3% of the value of the
Fund's assets). FOR PURPOSES OF THIS INVESTMENT RESTRICTION, THE ENTRY INTO
OPTIONS, FORWARD CONTRACTS, FUTURES CONTRACTS, INCLUDING THOSE RELATING TO
INDEXES, AND OPTIONS ON FUTURES CONTRACTS OR INDEXES SHALL NOT CONSTITUTE
BORROWING.
7[10]. Pledge, hypothecate, mortgage or otherwise encumber its assets,
except to the extent necessary to secure permitted borrowings AND TO THE EXTENT
RELATED TO THE DEPOSIT OF ASSETS IN ESCROW IN CONNECTION WITH THE PURCHASE OF
SECURITIES ON A WHEN-ISSUED OR DELAYED-DELIVERY BASIS AND COLLATERAL AND INITIAL
OR VARIATION MARGIN ARRANGEMENTS WITH RESPECT TO OPTIONS, FORWARD CONTRACTS,
FUTURES CONTRACTS, INCLUDING THOSE RELATED TO INDEXES, AND OPTIONS ON FUTURES
CONTRACTS OR INDEXES.
8. SELL SECURITIES SHORT.
Investment Restrictions numbered 1 through 6 would be fundamental policies
of the Fund 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 7 and 8 would not be fundamental policies and
may be changed by vote of a majority of the Fund's Board members at any time.
Current Investment Restriction number 7, which prohibits the Funds from
investing in securites of other investment companies, except as they may be
acquired as part of a merger, consolidation or acquisition of assets, would be
numbered as Investment Restriction No. 9 and would remain a non-fundamental
policy.
VOTE REQUIRED AND BOARD MEMBERS' RECOMMENDATION
As to each Fund, approval of these proposals requires the affirmative vote
of (a) 67% of the Fund's voting securities present at the Meeting, if the
holders of more than 50% of the Fund's outstanding voting securities are present
or represented by proxy, or (b) more than 50% of the Fund's outstanding voting
securities, whichever is less.
EACH FUND'S BOARD RECOMMENDS THAT STOCKHOLDERS VOTE "FOR" APPROVAL OF THE
CHANGES TO CERTAIN OF THE FUND'S FUNDAMENTAL POLICIES AND INVESTMENT
RESTRICTIONS.
ADDITIONAL INFORMATION
The Dreyfus Corporation, located at 200 Park Avenue, New York, New York
10166, serves as each Fund's investment adviser.
Premier Mutual Fund Services, Inc., with principal offices at 60 State
Street, Boston, Massachusetts 02109, serves as each Fund's distributor.
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.
Mellon Bank, N.A., The Dreyfus Corporation's parent, One Mellon Bank
Center, Pittsburgh, Pennsylvania 15258, acts as custodian of each Fund's
investments.
VOTING INFORMATION
Each Fund will bear its pro rata share of the cost of soliciting proxies.
In addition to the use of the mails, proxies may be solicited personally, by
telephone or by telegraph, and each Fund may pay persons holding Fund shares in
their names or those of their nominees for their expenses in sending soliciting
materials to their principals. Each Fund may retain an outside firm to assist in
the solicitation of proxies primarily by contacting stockholders by telephone
and telegram, which would cost each Fund approximately $15,000. Authorizations
to execute proxies may be obtained by telephonic or electronically transmitted
instructions in accordance with procedures designed to authenticate the
stockholder's identity. In all cases where a telephonic proxy is solicited, the
stockholder will be asked to provide his or her address, social security number
(in the case of an individual) or taxpayer identification number (in the case of
a non-individual) and the number of shares owned and to confirm that the
stockholder has received the Fund's proxy statement and proxy card in the mail.
Within 72 hours of receiving a stockholder's telephonic or electronically
transmitted voting instructions, a confirmation will be sent to the stockholder
to ensure that the vote has been taken in accordance with the stockholder's
instructions and to provide a telephone number to call immediately if the
stockholder's instructions are not correctly reflected in the confirmation. Any
stockholder giving a proxy may revoke it at any time before it is exercised by
submitting to the Fund a written notice of revocation or a subsequently executed
proxy or by attending the meeting and voting in person.
If a proxy is properly executed and returned accompanied by instructions to
withhold authority to vote, represents a broker "non-vote" (that is, a proxy
from a broker or nominee indicating that such person has not received
instructions from the beneficial owner or other person entitled to vote Fund
shares on a particular matter with respect to which the broker or nominee does
not have a discretionary power) or is marked with an abstention (collectively,
"abstentions"), the Fund shares represented thereby will be considered to be
present at the Meeting for purposes of determining the existence of a quorum for
the transaction of business. Abstentions will not constitute a vote "for" or
"against" a matter and will be disregarded in determining the "votes cast" on an
issue. For this reason, abstentions will have the effect of a "no" vote for the
purpose of obtaining requisite approval for the proposal.
If a quorum is not present at the Meeting, or if a quorum is present but
sufficient votes to approve a proposal are not received, the persons named as
proxies may propose one or more adjournments of the Meeting to permit further
solicitation of proxies for the proposal. In determining whether to adjourn the
Meeting, the following factors may be considered: the nature of the proposal,
the percentage of votes actually cast, the percentage of negative votes actually
cast, the nature of any further solicitation and the information to be provided
to stockholders with respect to the reasons for the solicitation. Any
adjournment will require the affirmative vote of a majority of those shares
affected by the adjournment that are represented at the Meeting in person or by
proxy. If a quorum is present, the persons named as proxies will vote those
proxies which they are entitled to vote "FOR" the proposals in favor of such
adjournment, and will vote those proxies required to be voted "AGAINST" the
proposals against any adjournment. As to each Fund, a quorum is constituted by
the presence in person or by proxy of the holders of at least 30% of the Fund's
outstanding shares entitled to vote at the Meeting.
As of January 12, 1998, the following stockholders were known by the
indicated Fund to own of record and beneficially 5% or more of the Fund's
outstanding voting securities: George R. Hecht, 22 Turtle Rock Court, Tiburon,
CA 94920-1300 - 10.27%; and State Street Bank and Trust Company, Trustee for
Health Partners 401(k) Plan, P.O. Box 1992, Boston, MA 02105-1992 - 8.06%.
As of January 12, 1998, each Fund's Board members and officers, as a group,
beneficially owned less than 1% of the Fund's outstanding shares.
OTHER MATTERS
Each Fund's Board is not aware of any other matters which may come before
the Meeting. However, should any such matters properly come before the Meeting,
it is the intention of the persons named in the accompanying form of proxy to
vote the proxy in accordance with their judgment on such matters.
NOTICE TO BANKS, BROKER/DEALERS AND VOTING TRUSTEES AND THEIR NOMINEES
Please advise the Fund, in care of Dreyfus Transfer, Inc., Attention:
Dreyfus 100% U.S. Treasury Funds, P.O. Box 9671, Providence, Rhode Island
02940-9671, whether other persons are the beneficial owners of Fund shares for
which proxies are being solicited from you, and, if so, the number of copies of
the proxy statement and other soliciting material you wish to receive in order
to supply copies to the beneficial owners of Fund shares.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, STOCKHOLDERS
WHO DO NOT EXPECT TO ATTEND THE MEETINGS IN PERSON ARE URGED TO COMPLETE, SIGN,
DATE AND RETURN EACH PROXY CARD IN THE ENCLOSED STAMPED ENVELOPE.
Dated: February 20, 1998
<PAGE>
APPENDIX
If each component of Proposal 1 is approved, each Fund would be permitted
to enter into repurchase agreements, engage in options and futures transactions
and lend its portfolio securities as described below. The following information
supplements the information contained in the proxy statement describing the
Proposal under the caption "Changes to Management Policies."
REPURCHASE AGREEMENTS. The Fund's custodian or sub-custodian will have
custody of, and will hold in a segregated account, securities acquired by a Fund
under a repurchase agreement. In an attempt to reduce the risk of incurring a
loss on a repurchase agreement, the 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.
OPTIONS AND FUTURES TRANSACTIONS. Options and futures are forms of
derivatives ("Derivatives") which are entered into for a variety of reasons,
including to hedge certain market risks, to provide a substitute for purchasing
or selling particular securities or to increase potential income gain.
Derivatives may provide a cheaper, quicker or more specifically focused way for
the Fund to invest than "traditional" securities.
Derivatives can be volatile and involve various types and degrees of risk,
depending upon the characteristics of the particular Derivative and the
portfolio as a whole. Derivatives permit the Fund to increase or decrease the
level of risk, or change the character of the risk, to which its portfolio is
exposed in much the same way as the Fund can increase or decrease the level of
risk or change the character of the risk, of its portfolio by making investments
in specific securities.
Derivatives may entail investment exposures that are greater than their
cost would suggest, meaning that a small investment in Derivatives could have a
large potential impact on the Fund's performance.
If a Fund invests in Derivatives at inopportune times or judges market
conditions incorrectly, such investments may lower the Fund's return or result
in a loss. The Fund also could experience losses if its Derivatives were poorly
correlated with its other investments, or if the Fund were unable to liquidate
its position because of an illiquid secondary market. The market for many
Derivatives is, or suddenly can become, illiquid. Changes in liquidity may
result in significant, rapid and unpredictable changes in the prices for
Derivatives.
Although the Fund will not be a commodity pool, certain options and futures
transactions subject the Fund to the rules of the Commodity Futures Trading
Commission ("CFTC") which limit the extent to which the Fund can enter into such
transactions. The Fund may invest in futures contracts and options with respect
thereto for hedging purposes without limit. However, the Fund may not invest in
such contracts and options for other purposes if the sum of the amount of
initial margin deposits and premiums paid for unexpired options with respect to
such contracts, other than for bona fide hedging purposes, exceeds 5% of the
liquidation value of the Fund's assets, after taking into account unrealized
profits and unrealized losses on such contracts and options; provided, however,
that in the case of an option that is in-the-money at the time of purchase, the
in-the-money amount may be excluded in calculating the 5% limitation.
Each Fund may purchase call and put options and write (i.e., sell) covered
call and put option contracts. When required by the Securities and Exchange
Commission, the Fund will set aside permissible liquid assets in a segregated
account to cover its obligations relating to its transactions in Derivatives. To
maintain this required cover, the Fund may have to sell portfolio securities at
disadvantageous prices or times since it may not be possible to liquidate a
Derivative position at a reasonable price.
Derivatives may be purchased on established exchanges or through privately
negotiated transactions referred to as over-the-counter Derivatives.
Exchange-traded Derivatives generally are guaranteed by the clearing agency
which is the issuer or counterparty to such Derivatives. This guarantee usually
is supported by a daily payment system (i.e., variation margin requirements)
operated by the clearing agency in order to reduce overall credit risk. As a
result, unless the clearing agency defaults, there is relatively little
counterparty credit risk associated with Derivatives purchased on an exchange.
By contrast, no clearing agency guarantees over-the-counter Derivatives.
Therefore, each party to an over-the-counter Derivative bears the risk that the
counterparty will default. Accordingly, The Dreyfus Corporation will consider
the creditworthiness of counterparties to over-the-counter Derivatives in the
same manner as it would review the credit quality of a security to be purchased
by the Fund. Over-the-counter Derivatives are less liquid than exchange-traded
Derivatives since the other party to the transaction may be the only investor
with sufficient understanding of the Derivative to be interested in bidding for
it.
When required by the Securities and Exchange Commission, the Fund will set
aside permissible liquid assets in a segregated account to cover its obligations
relating to its transactions in these Derivatives. To maintain this required
cover, the Fund may have to sell portfolio securities at disadvantageous prices
or times since it may not be possible to liquidate a Derivative position at a
reasonable price.
FUTURES CONTRACTS-Each Fund may purchase and sell interest rate futures
contracts. An interest rate future obligates the Fund to purchase or sell an
amount of a specific debt security at a future date at a specific price.
Engaging in futures transactions involves risk of loss to the Fund which could
adversely affect the value of the Fund's net assets. Although the Fund intends
to purchase or sell futures contracts only if there is an active market for such
contracts, no assurance can be given that a liquid market will exist for any
particular contract at any particular time. Many futures exchanges and boards of
trade limit the amount of fluctuation permitted in futures contract prices
during a single trading day. Once the daily limit has been reached in a
particular contract, no trades may be made that day at a price beyond that limit
or trading may be suspended for specified periods during the trading day.
Futures contract prices could move to the limit for several consecutive trading
days with little or no trading, thereby preventing prompt liquidation of futures
positions and potentially subjecting the Fund to substantial losses.
Successful use of futures by the Fund also is subject to The Dreyfus
Corporation's ability to predict correctly movements in the direction of the
relevant market, and, to the extent the transaction is entered into for hedging
purposes, to ascertain the appropriate correlation between the transaction being
hedged and the price movements of the futures contract. For example, if the Fund
uses futures to hedge against the possibility of a decline in the market value
of securities held in its portfolio and the prices of such securities instead
increase, the Fund will lose part or all of the benefit of the increased value
of securities which it has hedged because it will have offsetting losses in its
futures positions. Furthermore, if in such circumstances the Fund has
insufficient cash, it may have to sell securities to meet daily variation margin
requirements. The Fund may have to sell such securities at a time when it may be
disadvantageous to do so.
Pursuant to regulations and/or published positions of the Securities and
Exchange Commission, the Fund may be required to segregate permissible liquid
assets in connection with its commodities transactions in an amount generally
equal to the value of the underlying commodity. The segregation of such assets
will have the effect of limiting the Fund's ability otherwise to invest those
assets.
OPTIONS-Each Fund may purchase and write (i.e., sell) call or put options
with respect to specific securities. A call option gives the purchaser of the
option the right to buy, and obligates the writer to sell, the underlying
security or securities at the exercise price at any time during the option
period, or at a specific date. Conversely, a put option gives the purchaser of
the option the right to sell, and obligates the writer to buy, the underlying
security or securities at the exercise price at any time during the option
period, or at a specific date.
A covered call option written by the Fund is a call option with respect to
which the Fund owns the underlying security or otherwise covers the transaction
by segregating cash or other securities. A put option written by the Fund is
covered when, among other things, cash or liquid securities having a value equal
to or greater than the exercise price of the option are placed in a segregated
account with the Fund's custodian to fulfill the obligation undertaken. The
principal reason for writing covered call and put options is to realize, through
the receipt of premiums, a greater return than would be realized on the
underlying securities alone. The Fund receives a premium from writing covered
call or put options which it retains whether or not the option is exercised.
There is no assurance that sufficient trading interest to create a liquid
secondary market on a securities exchange will exist for any particular option
or at any particular time, and for some options no such secondary market may
exist. A liquid secondary market in an option may cease to exist for a variety
of reasons. In the past, for example, higher than anticipated trading activity
or order flow, or other unforeseen events, at times have rendered certain of the
clearing facilities inadequate and resulted in the institution of special
procedures, such as trading rotations, restrictions on certain types of orders
or trading halts or suspensions in one or more options. There can be no
assurance that similar events, or events that may otherwise interfere with the
timely execution of customers' orders, will not recur. In such event, it might
not be possible to effect closing transactions in particular options. If, as a
covered call option writer, the Fund is unable to effect a closing purchase
transaction in a secondary market, it will not be able to sell the underlying
security until the option expires or it delivers the underlying security upon
exercise or it otherwise covers its position.
The Fund may purchase cash-settled options on interest rate swaps in
pursuit of its investment objective. A cash-settled option on a swap gives the
purchaser the right, but not the obligation, in return for the premium paid, to
receive an amount of cash equal to the value of the underlying swap as of the
exercise date. These options typically are purchased in privately negotiated
transactions from financial institutions, including securities brokerage firms.
Successful use by the Fund of options will be subject to The Dreyfus
Corporation's ability to predict correctly movements in interest rates and
prices of securities underlying options. To the extent The Dreyfus Corporation's
predictions are incorrect, the Fund may incur losses.
LENDING PORTFOLIO SECURITIES. Each Fund may lend securities from its
portfolio to brokers, dealers and other financial institutions needing to borrow
securities to complete certain transactions. The Fund will continue to be
entitled to payments in amounts equal to the interest, or other distributions
payable on the loaned securities which affords the Fund an opportunity to earn
interest on the amount of the loan and on the loaned securities' collateral.
Loans of portfolio securities may not exceed 33-1/3% of the value of the Fund's
total assets, and the Fund will receive collateral consisting of cash, U.S.
Government securities or irrevocable letters of credit which will be maintained
at all times in an amount equal to at least 100% of the current market value of
the loaned securities. Such loans are terminable by the Fund at any time upon
specified notice. The Fund might experience risk of loss if the institution with
which it has engaged in a portfolio loan transaction breaches its agreement with
the Fund. In connection with its securities lending transactions, the Fund may
return to the borrower or a third party which is unaffiliated with the Fund, and
which is acting as a "placing broker," a part of the interest earned from the
investment of collateral received for securities loaned.
The Securities and Exchange Commission currently requires that the
following conditions must be met whenever portfolio securities are loaned: (1)
the Fund must receive at least 100% cash collateral from the borrower; (2) the
borrower must increase such collateral whenever the market value of the
securities rises above the level of such collateral; (3) the Fund must be able
to terminate the loan at any time; (4) the Fund must receive reasonable interest
on the loan, as well as any interest or other distributions payable on the
loaned securities, and any increase in market value; and (5) the Fund may pay
only reasonable custodian fees in connection with the loan.
<PAGE>
DREYFUS 100% U.S. TREASURY SHORT TERM FUND
The undersigned stockholder of DREYFUS 100% U.S. TREASURY SHORT TERM
FUND (the "Fund") hereby appoints DOUGLAS C. CONROY and MICHAEL S. PETRUCELLI
and each of them, the attorneys and proxies of the undersigned, with full power
of substitution, to vote, as indicated herein, all of the shares of the Fund
standing in the name of the undersigned at the close of business on February 19,
1998 at a Special Meeting of Stockholders to be held at the offices of The
Dreyfus Corporation, 200 Park Avenue, 7th Floor West, New York, New York, at
3:00 p.m. on Wednesday, April 15, 1998, and at any and all adjournments thereof,
with all of the powers the undersigned possesses and especially (but without
limiting the general authorization and power hereby given) to vote as indicated
on the Proposal, as more fully described in the proxy statement for the Meeting.
Please mark boxes in blue or black ink.
1. To change certain of the Fund's Investment Restrictions:
(a) To revise Investment Restriction number 3 to permit the Fund to
enter into repurchase agreements:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(b) To revise Investment Restrictions numbered 1, 4, 5, 9 (to be
renumbered 6) and 10 (to be renumbered 7) to permit the Fund to
engage in options and futures transactions:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(c) To revise Investment Restriction number 3 to permit the Fund to
lend portfolio securities:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(d) To revise Investment Restriction number 2 to clarify that the
Fund may dispose of its portfolio securities without being deemed
an underwriter:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(e) To revise Investment Restriction number 1 and adopt a new
Investment Restriction number 8 to make the prohibition on short
sales a non-fundamental policy:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. To transact such other business as may properly come before the
Meeting, or any adjournment(s) thereof.
<PAGE>
THIS PROXY IS SOLICITED BY THE FUND'S BOARD AND WILL BE VOTED FOR THE ABOVE
PROPOSAL UNLESS OTHERWISE INDICATED.
Signature(s) should be exactly as name or names
appearing on this form. If shares are held
jointly, each holder should sign. If signing is by
attorney, executor, administrator, trustee or
guardian, please give full title.
Dated: , 1998
-------------------------
Signature(s)
-------------------------
Signature(s)
Sign, Date and Return this Proxy Card
Promptly Using the Enclosed Envelope.
<PAGE>
DREYFUS 100% U.S. TREASURY INTERMEDIATE TERM FUND
The undersigned stockholder of DREYFUS 100% U.S. TREASURY INTERMEDIATE
TERM FUND (the "Fund") hereby appoints DOUGLAS C. CONROY and MICHAEL S.
PETRUCELLI and each of them, the attorneys and proxies of the undersigned, with
full power of substitution, to vote, as indicated herein, all of the shares of
the Fund standing in the name of the undersigned at the close of business on
February 19, 1998 at a Special Meeting of Stockholders to be held at the offices
of The Dreyfus Corporation, 200 Park Avenue, 7th Floor West, New York, New York,
at 3:00 p.m. on Wednesday, April 15, 1998, and at any and all adjournments
thereof, with all of the powers the undersigned possesses and especially (but
without limiting the general authorization and power hereby given) to vote as
indicated on the Proposal, as more fully described in the proxy statement for
the Meeting.
Please mark boxes in blue or black ink.
1. To change certain of the Fund's Investment Restrictions:
(a) To revise Investment Restriction number 3 to permit the Fund to
enter into repurchase agreements:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(b) To revise Investment Restrictions numbered 1, 4, 5, 9 (to be
renumbered 6) and 10 (to be renumbered 7) to permit the Fund to
engage in options and futures transactions:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(c) To revise Investment Restriction number 3 to permit the Fund to
lend portfolio securities:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(d) To revise Investment Restriction number 2 to clarify that the
Fund may dispose of its portfolio securities without being deemed
an underwriter:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(e) To revise Investment Restriction number 1 and adopt a new
Investment Restriction number 8 to make the prohibition on short
sales a non-fundamental policy:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. To transact such other business as may properly come before the
Meeting, or any adjournment(s) thereof.
<PAGE>
THIS PROXY IS SOLICITED BY THE FUND'S BOARD AND WILL BE VOTED FOR THE ABOVE
PROPOSAL UNLESS OTHERWISE INDICATED.
Signature(s) should be exactly as name or names
appearing on this form. If shares are held
jointly, each holder should sign. If signing is by
attorney, executor, administrator, trustee or
guardian, please give full title.
Dated: , 1998
-------------------------
Signature(s)
-------------------------
Signature(s)
Sign, Date and Return this Proxy Card
Promptly Using the Enclosed Envelope.
<PAGE>
DREYFUS 100% U.S. TREASURY LONG TERM FUND
The undersigned stockholder of DREYFUS 100% U.S. TREASURY LONG TERM
FUND (the "Fund") hereby appoints DOUGLAS C. CONROY and MICHAEL S. PETRUCELLI
and each of them, the attorneys and proxies of the undersigned, with full power
of substitution, to vote, as indicated herein, all of the shares of the Fund
standing in the name of the undersigned at the close of business on February 19,
1998 at a Special Meeting of Stockholders to be held at the offices of The
Dreyfus Corporation, 200 Park Avenue, 7th Floor West, New York, New York, at
3:00 p.m. on Wednesday, April 15, 1998, and at any and all adjournments thereof,
with all of the powers the undersigned possesses and especially (but without
limiting the general authorization and power hereby given) to vote as indicated
on the Proposal, as more fully described in the proxy statement for the Meeting.
Please mark boxes in blue or black ink.
1. To change certain of the Fund's Investment Restrictions:
(a) To revise Investment Restriction number 3 to permit the Fund to
enter into repurchase agreements:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(b) To revise Investment Restrictions numbered 1, 4, 5, 9 (to be
renumbered 6) and 10 (to be renumbered 7) to permit the Fund to
engage in options and futures transactions:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(c) To revise Investment Restriction number 3 to permit the Fund to
lend portfolio securities:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(d) To revise Investment Restriction number 2 to clarify that the
Fund may dispose of its portfolio securities without being deemed
an underwriter:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
(e) To revise Investment Restriction number 1 and adopt a new
Investment Restriction number 8 to make the prohibition on short
sales a non-fundamental policy:
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. To transact such other business as may properly come before the
Meeting, or any adjournment(s) thereof.
<PAGE>
THIS PROXY IS SOLICITED BY THE FUND'S BOARD AND WILL BE VOTED FOR THE ABOVE
PROPOSAL UNLESS OTHERWISE INDICATED.
Signature(s) should be exactly as name or names
appearing on this form. If shares are held
jointly, each holder should sign. If signing is by
attorney, executor, administrator, trustee or
guardian, please give full title.
Dated: , 1998
-------------------------
Signature(s)
-------------------------
Signature(s)
Sign, Date and Return this Proxy Card
Promptly Using the Enclosed Envelope.
