File Nos. 33-7497
811-4765
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 24 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 24 [X]
(Check appropriate box or boxes.)
DREYFUS PREMIER CALIFORNIA MUNICIPAL BOND FUND
(Exact Name of Registrant as Specified in Charter)
c/o The Dreyfus Corporation
200 Park Avenue, New York, New York 10166
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (212) 922-6000
Mark N. Jacobs, Esq.
200 Park Avenue
New York, New York 10166
(Name and Address of Agent for Service)
It is proposed that this filing will become effective (check appropriate box)
immediately upon filing pursuant to paragraph (b)
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X on June 1, 2000 pursuant to paragraph (b)
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60 days after filing pursuant to paragraph (a)(i)
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on (date) pursuant to paragraph (a)(i)
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75 days after filing pursuant to paragraph (a)(ii)
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on (date) pursuant to paragraph (a)(ii) of Rule 485
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If appropriate, check the following box:
this post-effective amendment designates a new effective date for a
previously filed post-effective amendment.
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Dreyfus Premier California Municipal Bond Fund
Investing for income exempt from federal and California state income taxes
PROSPECTUS June 1, 2000
As with all mutual funds, the Securities and Exchange Commission has not
approved or disapproved these securities or passed upon the adequacy of this
prospectus. Any representation to the contrary is a criminal offense.
<PAGE>
The Fund
Dreyfus Premier California Municipal Bond Fund
---------------------------------
Ticker Symbols CLASS A: PRCAX
CLASS B: PRCBX
CLASS C: DPACX
Contents
The Fund
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Goal/Approach INSIDE COVER
Main Risks 1
Past Performance 1
Expenses 2
Management 3
Financial Highlights 4
Your Investment
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Account Policies 6
Distributions and Taxes 8
Services for Fund Investors 9
Instructions for Regular Accounts 10
For More Information
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INFORMATION ON THE FUND'S RECENT STRATEGIES AND HOLDINGS CAN BE FOUND IN THE
CURRENT ANNUAL/SEMIANNUAL REPORT. SEE BACK COVER.
GOAL/APPROACH
The fund seeks to maximize current income exempt from federal and California
state income taxes, as is consistent with the preservation of capital. To pursue
this goal, the fund normally invests substantially all of its assets in
municipal bonds that provide income exempt from federal and California state
income taxes.
The fund will invest at least 70% of its assets in investment grade municipal
bonds or the unrated equivalent as determined by Dreyfus. For additional yield,
it may invest up to 30% of its assets in municipal bonds rated below investment
grade ("high yield" or "junk" bonds) or the unrated equivalent as determined by
Dreyfus. Under normal market conditions, the dollar-weighted average maturity of
the fund's portfolio is expected to exceed 10 years.
The portfolio manager buys and sells bonds based on credit quality, financial
outlook and yield potential. Bonds with deteriorating credit quality are
potential sell candidates, while those offering higher yields are potential buy
candidates.
Concepts to understand
MUNICIPAL BONDS: debt securities that provide income free from federal income
tax. Municipal bonds are typically of two types:
* GENERAL OBLIGATION BONDS, which are secured by the full faith and credit of
the issuer and its taxing power
* REVENUE BONDS, which are payable from the revenue derived from a specific
revenue source, such as charges for water and sewer service or highway
tolls
INVESTMENT GRADE BONDS: independent rating organizations analyze and evaluate a
bond issuer's credit history and ability to repay debts. Based on their
assessment, they assign letter grades that reflect the issuer's
creditworthiness. AAA or Aaa represents the highest credit rating, AA/Aa the
second highest, and so on down to D, for defaulted debt. Bonds rated BBB or Baa
and above are considered investment grade.
<PAGE>
MAIN RISKS
Prices of bonds tend to move inversely with changes in interest rates. While a
rise in rates may allow the fund to invest for higher yields, the most immediate
effect is usually a drop in bond prices and, therefore, in the fund's share
price as well. As a result, the value of your investment in the fund could go up
and down, which means that you could lose money.
Other risk factors could have an effect on the fund's performance:
* if an issuer fails to make timely interest or principal payments, or if
there is a decline in the credit quality of a bond or a perception of a
decline, the bond's value could fall, potentially lowering the fund's share
price
* California's economy and revenues underlying its municipal bonds may
decline
* investing primarily in a single state may make the fund's portfolio
securities more sensitive to risks specific to the stat
* lower-rated, higher-yielding municipal obligations are subject to greater
credit risk, including the risk of default, than investment grade
obligations; lower-rated bonds tend to be more volatile and less liquid
Although the fund's objective is to generate income exempt from federal and
California state income taxes, interest from some of its holdings may be subject
to the federal alternative minimum tax. In addition, the fund occasionally may
invest in taxable bonds and municipal bonds that are exempt only from federal
personal income tax.
Other potential risks
The fund may invest in certain derivatives, such as futures and options.
Derivatives can be illiquid and highly sensitive to changes in their underlying
security, interest rate or index and, as a result, can be highly volatile. A
small investment in certain derivatives could have a potentially large impact on
the fund's performance.
PAST PERFORMANCE
The bar chart and table below show some of the risks of investing in the fund.
The bar chart shows the changes in the fund's Class A performance from year to
year. Sales loads are not reflected in the chart; if they were, the returns
shown would have been lower. The table compares the fund's average annual total
return to that of the Lehman Brothers Municipal Bond Index, a widely recognized,
unmanaged index of long-term municipal bond performance. Of course, past
performance is no guarantee of future results.
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Year-by-year total return AS OF 12/31 EACH YEAR (%)
CLASS A SHARES
7.88 11.06 6.25 13.57 -6.02 17.38 4.03 7.88 5.06 -6.58
90 91 92 93 94 95 96 97 98 99
BEST QUARTER: Q1 '95 +7.07%
WORST QUARTER: Q1 '94 -5.14%
THE FUND'S CLASS A YEAR-TO-DATE TOTAL RETURN AS OF 3/31/00 WAS 4.08%.
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Average annual total return AS OF 12/31/99
<TABLE>
<CAPTION>
Since
Inception date 1 Year 5 Years 10 Years inception
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<S> <C> <C> <C> <C> <C>
CLASS A (11/10/86) -10.80% 4.31% 5.51% --
CLASS B (1/15/93) -10.61% 4.41% -- 4.26%
CLASS C (6/2/95) -8.13% -- -- 2.61%
LEHMAN BROTHERS
MUNICIPAL BOND INDEX -2.06% 6.91% 6.89% 5.83%*
</TABLE>
* FOR COMPARATIVE PURPOSES, THE VALUE OF THE INDEX ON 12/31/92 IS USED AS THE
BEGINNING VALUE ON 1/15/93.
What this fund is -- and isn't
This fund is a mutual fund: a pooled investment that is professionally managed
and gives you the opportunity to participate in financial markets. It strives to
reach its stated goal, although as with all mutual funds, it cannot offer
guaranteed results.
An investment in this fund is not a bank deposit. It is not insured or
guaranteed by the FDIC or any other government agency. It is not a complete
investment program. You could lose money in this fund, but you also have the
potential to make money.
The Fund 1
<PAGE 1>
EXPENSES
As an investor, you pay certain fees and expenses in connection with the fund,
which are described in the table below.
<TABLE>
<CAPTION>
Fee table
CLASS A CLASS B CLASS C
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<S> <C> <C> <C>
SHAREHOLDER TRANSACTION FEES (FEES PAID FROM YOUR ACCOUNT)
Maximum front-end sales charge on purchases
AS A % OF OFFERING PRICE 4.50 NONE NONE
Maximum contingent deferred sales charge (CDSC)
AS A % OF PURCHASE OR SALE PRICE, WHICHEVER IS LESS NONE* 4.00 1.00
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ANNUAL FUND OPERATING EXPENSES (EXPENSES PAID FROM FUND ASSETS)
% OF AVERAGE DAILY NET ASSETS
Management fees .55 .55 .55
Rule 12b-1 fee NONE .50 .75
Shareholder services fee .25 .25 .25
Other expenses .15 .16 .15
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TOTAL .95 1.46 1.70
* SHARES BOUGHT WITHOUT AN INITIAL SALES CHARGE AS PART OF AN INVESTMENT OF
$1 MILLION OR MORE MAY BE CHARGED A CDSC OF 1.00% IF REDEEMED WITHIN ONE
YEAR.
</TABLE>
<TABLE>
<CAPTION>
Expense example
1 Year 3 Years 5 Years 10 Years
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<S> <C> <C> <C> <C>
CLASS A $543 $739 $952 $1,564
CLASS B
WITH REDEMPTION $549 $762 $997 $1,482**
WITHOUT REDEMPTION $149 $462 $797 $1,482**
CLASS C
WITH REDEMPTION $273 $536 $923 $2,009
WITHOUT REDEMPTION $173 $536 $923 $2,009
** ASSUMES CONVERSION OF CLASS B TO CLASS A AT END OF THE SIXTH YEAR FOLLOWING
THE DATE OF PURCHASE.
</TABLE>
This example shows what you could pay in expenses over time. It uses the same
hypothetical conditions other funds use in their prospectuses: $10,000 initial
investment, 5% total return each year and no changes in expenses. Because actual
return and expenses will be different, the example is for comparison only.
Concepts to understand
MANAGEMENT FEE: the fee paid to Dreyfus for managing the fund's portfolio and
assisting in all aspects of its operation.
RULE 12B-1 FEE: the fee paid to Dreyfus Service Corporation, the fund's
distributor, to finance the sale of Class B and Class C shares. Because this fee
is paid out of the fund's assets on an ongoing basis, over time it will increase
the cost of your investment and may cost you more than paying other types of
sales charges.
SHAREHOLDER SERVICES FEE: a fee paid to the fund's distributor for shareholder
account service and maintenance.
OTHER EXPENSES: fees paid by the fund for miscellaneous items such as transfer
agency, custody, professional and registration fees.
2
<PAGE 2>
MANAGEMENT
The investment adviser for the fund is The Dreyfus Corporation, 200 Park Avenue,
New York, New York 10166. Founded in 1947, Dreyfus manages more than $129
billion in over 160 mutual fund portfolios. For the past fiscal year, the fund
paid Dreyfus a management fee at the annual rate of 0.55% of the fund's average
daily net assets. Dreyfus is the primary mutual fund business of Mellon
Financial Corporation, a global financial services company with approximately
$2.5 trillion of assets under management, administration or custody, including
approximately $485 billion under management. Mellon provides wealth management,
global investment services and a comprehensive array of banking services for
individuals, businesses and institutions. Mellon is headquartered in Pittsburgh,
Pennsylvania.
The Dreyfus asset management philosophy is based on the belief that discipline
and consistency are important to investment success. For each fund, Dreyfus
seeks to establish clear guidelines for portfolio management and to be
systematic in making decisions. This approach is designed to provide each fund
with a distinct, stable identity.
The fund is managed by Joseph P. Darcy. Mr. Darcy has managed the fund since
August 1999 and has been employed by Dreyfus as a portfolio manager since 1994.
The fund, Dreyfus and Dreyfus Service Corporation (the fund's distributor) each
have adopted a code of ethics that permits its personnel, subject to such code,
to invest in securities, including securities that may be purchased or held by
the fund. The Dreyfus code of ethics restricts the personal securities
transactions of its employees, and requires portfolio managers and other
investment personnel to comply with the code's preclearance and disclosure
procedures. Its primary purpose is to ensure that personal trading by Dreyfus
employees does not disadvantage any Dreyfus-managed fund.
The Fund 3
<PAGE 3>
FINANCIAL HIGHLIGHTS
The following tables describe the performance of each share class for the fiscal
periods indicated. "Total return" shows how much your investment in the fund
would have increased (or decreased) during each period, assuming you had
reinvested all dividends and distributions. These figures have been
independently audited by Ernst & Young LLP, whose report, along with the fund's
financial statements, is included in the annual report.
<TABLE>
<CAPTION>
YEAR ENDED JANUARY 31,
CLASS A 2000 1999 1998 1997 1996
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<S> <C> <C> <C> <C> <C>
PER-SHARE DATA ($)
Net asset value, beginning of period 12.78 13.00 12.58 12.97 12.24
Investment operations: Investment income -- net .54 .56 .60 .65 .67
Net realized and unrealized gain (loss) on investments (1.59) .12 .53 (.24) 1.02
Total from investment operations (1.05) .68 1.13 .41 1.69
Distributions: Dividends from investment income -- net (.54) (.56) (.61) (.64) (.67)
Dividends from net realized gain on investments (.06) (.34) (.10) (.16) (.29)
Total distributions (.60) (.90) (.71) (.80) (.96)
Net asset value, end of period 11.13 12.78 13.00 12.58 12.97
Total return (%)* (8.42) 5.39 9.27 3.31 14.15
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RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) .95 .94 .95 .92 .93
Ratio of net investment income to average net assets (%) 4.47 4.36 4.71 5.18 5.22
Portfolio turnover rate (%) 54.74 101.36 103.75 39.76 92.42
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Net assets, end of period ($ x 1,000) 115,926 144,855 152,416 163,030 185,187
* EXCLUSIVE OF SALES CHARGE.
</TABLE>
<TABLE>
<CAPTION>
YEAR ENDED JANUARY 31,
CLASS B 2000 1999 1998 1997 1996
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<S> <C> <C> <C> <C> <C>
PER-SHARE DATA ($)
Net asset value, beginning of period 12.79 13.01 12.59 12.98 12.25
Investment operations: Investment income -- net .47 .50 .53 .59 .60
Net realized and unrealized gain (loss) on investments (1.59) .12 .53 (.25) 1.02
Total from investment operations (1.12) .62 1.06 .34 1.62
Distributions: Dividends from investment income -- net (.47) (.50) (.54) (.57) (.60)
Dividends from net realized gain on investments (.06) (.34) (.10) (.16) (.29)
Total distributions (.53) (.84) (.64) (.73) (.89)
Net asset value, end of period 11.14 12.79 13.01 12.59 12.98
Total return (%)* (8.89) 4.86 8.69 2.79 13.55
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RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) 1.46 1.45 1.46 1.44 1.45
Ratio of net investment income to average net assets (%) 3.92 3.85 4.18 4.66 4.69
Portfolio turnover rate (%) 54.74 101.36 103.75 39.76 92.42
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Net assets, end of period ($ x 1,000) 13,518 23,810 24,942 20,341 21,530
* EXCLUSIVE OF SALES CHARGE.
</TABLE>
4
<PAGE 4>
<TABLE>
<CAPTION>
YEAR ENDED JANUARY 31,
CLASS C 2000 1999 1998 1997 1996(1)
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<S> <C> <C> <C> <C> <C>
PER-SHARE DATA ($)
Net asset value, beginning of period 12.82 13.04 12.61 12.98 12.98
Investment operations: Investment income -- net .45 .47 .50 .54 .37
Net realized and unrealized gain (loss) on investments (1.59) .12 .53 (.21) .29
Total from investment operations (1.14) .59 1.03 .33 .66
Distributions: Dividends from investment income -- net (.45) (.47) (.50) (.54) (.37)
Dividends from net realized gain on investments (.06) (.34) (.10) (.16) (.29)
Total distributions (.51) (.81) (.60) (.70) (.66)
Net asset value, end of period 11.17 12.82 13.04 12.61 12.98
Total return (%)(2) (9.07) 4.63 8.42 2.67 7.90(3)
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RATIOS/SUPPLEMENTAL DATA
Ratio of expenses to average net assets (%) 1.70 1.67 1.68 1.77 4.42(3)
Ratio of net investment income to average net assets (%) 3.73 3.68 3.92 4.33 4.31(3)
Portfolio turnover rate (%) 54.74 101.36 103.75 39.76 92.42
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Net assets, end of period ($ x 1,000) 1,169 1,236 1,135 1,029 1
(1) FROM JUNE 2, 1995 (COMMENCEMENT OF INITIAL OFFERING) TO JANUARY 31, 1996.
(2) EXCLUSIVE OF SALES CHARGE.
(3) ANNUALIZED.
The Fund 5
</TABLE>
<PAGE 5>
Your Investment
ACCOUNT POLICIES
THE DREYFUS PREMIER FUNDS are designed primarily for people who are investing
through a third party, such as a bank, broker-dealer or financial adviser. Third
parties with whom you open a fund account may impose policies, limitations and
fees which are different from those described here.
YOU WILL NEED TO CHOOSE A SHARE CLASS before making your initial investment. In
making your choice, you should weigh the impact of all potential costs over the
length of your investment, including sales charges and annual fees. For example,
in some cases, it can be more economical to pay an initial sales charge than to
choose a class with no initial sales charge but higher annual fees and a
contingent deferred sales charge (CDSC).
* CLASS A shares may be appropriate for investors who prefer to pay the
fund's sales charge up front rather than upon the sale of their shares,
want to take advantage of the reduced sales charges available on larger
investments and/or have a longer-term investment horizon
* CLASS B shares may be appropriate for investors who wish to avoid a
front-end sales charge, put 100% of their investment dollars to work
immediately and/or have a longer-term investment horizon
* CLASS C shares may be appropriate for investors who wish to avoid a
front-end sales charge, put 100% of their investment dollars to work
immediately and/or have a shorter-term investment horizon
Your financial representative can help you choose the share class that is
appropriate for you.
Share class charges
EACH SHARE CLASS has its own fee structure. In some cases, you may not have to
pay a sales charge to buy or sell shares. Consult your financial representative
or the SAI to see if this may apply to you. Shareholders owning Class B shares
on or prior to November 30, 1996, may be eligible for a lower CDSC.
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Sales charges
<TABLE>
<CAPTION>
CLASS A -- CHARGED WHEN YOU BUY SHARES
Sales charge Sales charge
deducted as a % as a % of your
Your investment of offering price net investment
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<S> <C> <C>
Less than $50,000 4.50% 4.70%
$50,000 -- $99,999 4.00% 4.20%
$100,000 -- $249,999 3.00% 3.10%
$250,000 -- $499,999 2.50% 2.60%
$500,000 -- $999,999 2.00% 2.00%
$1 million or more* 0.00% 0.00%
* A 1.00% CDSC may be charged on any shares sold within one year of purchase
(except shares bought through dividend reinvestment).
</TABLE>
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CLASS B -- CHARGED WHEN YOU SELL SHARES
CDSC as a % of your initial
Years since purchase investment or your redemption
was made (whichever is less)
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Up to 2 years 4.00%
2 -- 4 years 3.00%
4 -- 5 years 2.00%
5 -- 6 years 1.00%
More than 6 years Shares will automatically
convert to Class A
Class B shares also carry an annual Rule 12b-1 fee of 0.50% of the class's
average daily net assets.
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CLASS C -- CHARGED WHEN YOU SELL SHARES
A 1.00% CDSC is imposed on redemptions made within the first year of purchase.
Class C shares also carry an annual Rule 12b-1 fee of 0.75% of the class's
average daily net assets.
Reduced Class A sales charge
LETTER OF INTENT: lets you purchase Class A shares over a 13-month period and
receive the same sales charge as if all shares had been purchased at once.
RIGHT OF ACCUMULATION: lets you add the value of any shares you own in this
fund, any other Dreyfus Premier fund, or any other fund that is advised by
Founders Asset Management LLC (Founders), an affiliate of Dreyfus, sold with a
sales load, to the amount of your next Class A investment for purposes of
calculating the sales charge.
CONSULT THE STATEMENT OF ADDITIONAL INFORMATION (SAI) OR YOUR FINANCIAL
REPRESENTATIVE FOR MORE DETAILS.
6
<PAGE 6>
Buying shares
THE NET ASSET VALUE (NAV) of each class is generally calculated as of the close
of trading on the New York Stock Exchange (NYSE) (usually 4:00 p.m. Eastern
time) every day the exchange is open. Your order will be priced at the next NAV
calculated after your order is accepted by the fund's transfer agent or other
authorized entity. The fund's investments are generally valued based on fair
value as determined by an independent pricing service approved by the fund's
board. The pricing service's procedures are reviewed under the general
supervision of the board. Because the fund seeks tax-exempt income, it is not
recommended for purchase in IRAs or other qualified plans.
ORDERS TO BUY AND SELL SHARES received by dealers by the close of trading on the
NYSE and transmitted to the distributor or its designee by the close of its
business day (normally 5:15 p.m. Eastern time) will be based on the NAV
determined as of the close of trading on the NYSE that day.
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Minimum investments
Initial Additional
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REGULAR ACCOUNTS $1,000 $100; $500 FOR
TELETRANSFER INVESTMENTS
DREYFUS AUTOMATIC $100 $100
INVESTMENT PLANS
All investments must be in U.S. dollars. Third-party checks cannot be accepted.
You may be charged a fee for any check that does not clear. Maximum TeleTransfer
purchase is $150,000 per day.
Concepts to understand
NET ASSET VALUE (NAV): the market value of one share, computed by dividing the
total net assets of a fund or class by its shares outstanding. The fund's Class
A shares are offered to the public at NAV plus a sales charge. Classes B and C
are offered at NAV, but generally are subject to higher annual operating
expenses and a CDSC.
Selling shares
YOU MAY SELL (REDEEM) SHARES AT ANY TIME through your financial representative,
or you can contact the fund directly. Your shares will be sold at the next NAV
calculated after your order is accepted by the fund's transfer agent or other
authorized entity. Any certificates representing fund shares being sold must be
returned with your redemption request. Your order will be processed promptly,
and you will generally receive the proceeds within a week.
TO KEEP YOUR CDSC AS LOW AS POSSIBLE, each time you request to sell shares we
will first sell shares that are not subject to a CDSC, and then those subject to
the lowest charge. The CDSC is based on the lesser of the original purchase cost
or the current market value of the shares being sold, and is not charged on
shares you acquired by reinvesting your dividends. There are certain instances
when you may qualify to have the CDSC waived. Consult your financial
representative or the SAI for details.
BEFORE SELLING OR WRITING A CHECK against recently purchased shares, please note
that if the fund has not yet collected payment for the shares you are selling,
it may delay sending the proceeds for up to eight business days or until it has
collected payment.
Written sell orders
Some circumstances require written sell orders along with signature guarantees.
These include:
* amounts of $10,000 or more on accounts whose address has been changed
within the last 30 days
* requests to send the proceeds to a different payee or address
Written sell orders of $100,000 or more must also be signature guaranteed.
A SIGNATURE GUARANTEE helps protect against fraud. You can obtain one from most
banks or securities dealers, but not from a notary public. For joint accounts,
each signature must be guaranteed. Please call us to ensure that your signature
guarantee will be processed correctly.
Your Investment 7
<PAGE 7>
ACCOUNT POLICIES (CONTINUED)
General policies
UNLESS YOU DECLINE TELEPHONE PRIVILEGES on your application, you may be
responsible for any fraudulent telephone order as long as Dreyfus takes
reasonable measures to verify the order.
THE FUND RESERVES THE RIGHT TO:
* refuse any purchase or exchange request that could adversely affect the
fund or its operations, including those from any individual or group who,
in the fund's view, is likely to engage in excessive trading (usually
defined as more than four exchanges out of the fund within a calendar year)
* refuse any purchase or exchange request in excess of 1% of the fund's total
assets
* change or discontinue its exchange privilege, or temporarily suspend this
privilege during unusual market conditions
* change its minimum investment amounts
* delay sending out redemption proceeds for up to seven days (generally
applies only in cases of very large redemptions, excessive trading or
during unusual market conditions)
The fund also reserves the right to make a "redemption in kind" -- payment in
portfolio securities rather than cash -- if the amount you are redeeming is
large enough to affect fund operations (for example, if it represents more than
1% of the fund's assets).
Small account policies
To offset the relatively higher costs of servicing smaller accounts, the fund
charges regular accounts with balances below $2,000 an annual fee of $12. The
fee will be imposed during the fourth quarter of each calendar year.
The fee will be waived for: any investor whose aggregate Dreyfus mutual fund
investments total at least $25,000; accounts participating in automatic
investment programs; accounts opened through a financial institution.
If your account falls below $500, the fund may ask you to increase your balance.
If it is still below $500 after 30 days, the fund may close your account and
send you the proceeds.
DISTRIBUTIONS AND TAXES
THE FUND GENERALLY PAYS ITS SHAREHOLDERS dividends from its net investment
income once a month, and distributes any net capital gains it has realized once
a year. Each share class will generate a different dividend because each has
different expenses. Your distributions will be reinvested in the fund unless you
instruct the fund otherwise. There are no fees or sales charges on
reinvestments.
THE FUND ANTICIPATES that virtually all of its income dividends will be exempt
from federal and California state income taxes. However, any dividends paid from
interest on taxable investments or short-term capital gains will be taxable as
ordinary income. Any distribution of long-term capital gains will be taxable as
such. The tax status of any distribution is the same regardless of how long you
have been in the fund and whether you reinvest your distributions or take them
in cash. In general, distributions are federally taxable as follows:
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Taxability of distributions
Type of Tax rate for Tax rate for
distribution 15% bracket 28% bracket or above
- --------------------------------------------------------------------------------
INCOME GENERALLY GENERALLY
DIVIDENDS TAX EXEMPT TAX EXEMPT
SHORT-TERM ORDINARY ORDINARY
CAPITAL GAINS INCOME RATE INCOME RATE
LONG-TERM
CAPITAL GAINS 10% 20%
Because everyone's tax situation is unique, always consult your tax professional
about federal, state and local tax consequences.
Small account policies
To offset the relatively higher costs of servicing smaller accounts, the fund
charges regular accounts with balances below $2,000 an annual fee of $12. The
fee will be imposed during the fourth quarter of each calendar year.
The fee will be waived for: any investor whose aggregate Dreyfus mutual fund
investments total at least $25,000; accounts participating in automatic
investment programs; accounts opened through a financial institution.
If your account falls below $500, the fund may ask you to increase your balance.
If it is still below $500 after 30 days, the fund may close your account and
send you the proceeds.
Taxes on transactions
Any sale or exchange of fund shares, including through the checkwriting
privilege, may generate a tax liability.
The table above also can provide a guide for potential tax liability when
selling or exchanging fund shares. "Short-term capital gains" applies to fund
shares sold or exchanged up to 12 months after buying them. "Long-term capital
gains" applies to shares sold or exchanged after 12 months.
8
<PAGE 8>
SERVICES FOR FUND INVESTORS
THE THIRD PARTY THROUGH WHOM YOU PURCHASED fund shares may impose different
restrictions on these services and privileges offered by the fund, or may not
make them available at all. Consult your financial representative for more
information on the availability of these services and privileges.
Automatic services
BUYING OR SELLING SHARES AUTOMATICALLY is easy with the services described
below. With each service, you select a schedule and amount, subject to certain
restrictions. You can set up most of these services with your application, or by
calling your financial representative or 1-800-554-4611.
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For investing
DREYFUS AUTOMATIC For making automatic investments
ASSET BUILDER((reg.tm)) from a designated bank account.
DREYFUS GOVERNMENT For making automatic investments
DIRECT DEPOSIT from your federal employment,
PRIVILEGE Social Security or other regular
federal government check.
DREYFUS DIVIDEND For automatically reinvesting the
SWEEP dividends and distributions from
the fund into another Dreyfus fund
or certain Founders-advised funds
(not available for IRAs).
- --------------------------------------------------------------------------------
For exchanging shares
DREYFUS AUTO- For making regular exchanges
EXCHANGE PRIVILEGE from the fund into another
Dreyfus fund or certain
Founders-advised funds.
- --------------------------------------------------------------------------------
For selling shares
DREYFUS AUTOMATIC For making regular withdrawals
WITHDRAWAL PLAN from most Dreyfus funds. There will be no CDSC
on Class B shares, as long as the amounts
withdrawn do not exceed 12% annually of the
account value at the time the shareholder
elects to participate in the plan.
Checkwriting privilege (Class A only)
YOU MAY WRITE REDEMPTION CHECKS against your account for Class A shares in
amounts of $500 or more. These checks are free; however, a fee will be charged
if you request a stop payment or if the transfer agent cannot honor a redemption
check due to insufficient funds or another valid reason. Please do not postdate
your checks or use them to close your account.
Exchange privilege
YOU CAN EXCHANGE SHARES WORTH $500 OR MORE from one class of the fund into the
same class of another Dreyfus Premier fund or Founders-advised fund. You can
request your exchange by contacting your financial representative. Be sure to
read the current prospectus for any fund into which you are exchanging before
investing. Any new account established through an exchange will generally have
the same privileges as your original account (as long as they are available).
There is currently no fee for exchanges, although you may be charged a sales
load when exchanging into any fund that has a higher one.
TeleTransfer privilege
TO MOVE MONEY BETWEEN YOUR BANK ACCOUNT and your Dreyfus fund account with a
phone call, use the TeleTransfer privilege. You can set up TeleTransfer on your
account by providing bank account information and following the instructions on
your application, or contacting your financial representative.
Reinvestment privilege
UPON WRITTEN REQUEST YOU CAN REINVEST up to the number of Class A or B shares
you redeemed within 45 days of selling them at the current share price without
any sales charge. If you paid a CDSC, it will be credited back to your account.
This privilege may be used only once.
Account statements
EVERY FUND INVESTOR automatically receives regular account statements. You'll
also be sent a yearly statement detailing the tax characteristics of any
dividends and distributions you have received.
Your Investment 9
<PAGE 9>
INSTRUCTIONS FOR REGULAR ACCOUNTS
TO OPEN AN ACCOUNT
In Writing
Complete the application.
Mail your application and a check to:
Name of Fund
P.O. Box 6587, Providence, RI 02940-6587
Attn: Institutional Processing
TO ADD TO AN ACCOUNT
Fill out an investment slip, and write your account number on your check.
Mail the slip and a check to: Name of Fund
P.O. Box 6587, Providence, RI 02940-6587 Attn: Institutional Processing
By Telephone
WIRE Have your bank send your
investment to The Bank of New York, with these instructions:
* ABA# 021000018
* DDA# 8900119306
* the fund name
* the share class
* your Social Security or tax ID number
* name(s) of investor(s)
* dealer number if applicable
Call us to obtain an account number. Return your application with the account
number on the application.
WIRE Have your bank send your investment to The Bank of New York, with these
instructions:
* ABA# 021000018
* DDA# 8900119306
* the fund name
* the share class
* your account number
* name(s) of investor(s)
* dealer number if applicable
ELECTRONIC CHECK Same as wire, but insert "1111" before your account number.
TELETRANSFER Request TeleTransfer on your application. Call us to request your
transaction.
Automatically
WITH AN INITIAL INVESTMENT Indicate
on your application which automatic service(s) you want. Return your application
with your investment.
ALL SERVICES Call us or your financial representative to request a form to add
any automatic investing service (see "Services for Fund Investors"). Complete
and return the form along with any other required materials.
TO SELL SHARES
Write a redemption check (Class A only) OR write a letter of instruction that
includes:
* your name(s) and signature(s)
* your account number
* the fund name
* the dollar amount you want to sell
* how and where to send the proceeds
Obtain a signature guarantee or other documentation, if required (see page 7).
Mail your request to: The Dreyfus Family of Funds P.O. Box 6587, Providence, RI
02940-6587 Attn: Institutional Processing
WIRE Call us or your financial representative to request your transaction. Be
sure the fund has your bank account information on file. Proceeds will be wired
to your bank.
TELETRANSFER Call us or your financial representative to request your
transaction. Be sure the fund has your bank account information on file.
Proceeds will be sent to your bank by electronic check.
CHECK Call us or your financial representative to request your transaction. A
check will be sent to the address of record.
AUTOMATIC WITHDRAWAL PLAN Call us or your financial representative to request a
form to add the plan. Complete the form, specifying the amount and frequency of
withdrawals you would like.
Be sure to maintain an account balance of $5,000 or more.
To open an account, make subsequent investments or to sell shares, please
contact your financial representative or call toll free in the U.S.
1-800-554-4611. Make checks payable to: THE DREYFUS FAMILY OF FUNDS.
Concepts to understand
WIRE TRANSFER: for transferring money from one financial institution to another.
Wiring is the fastest way to move money, although your bank may charge a fee to
send or receive wire transfers. Wire redemptions from the fund are subject to a
$1,000 minimum.
ELECTRONIC CHECK: for transferring money out of a bank account. Your transaction
is entered electronically, but may take up to eight business days to clear.
Electronic checks usually are available without a fee at all Automated Clearing
House (ACH) banks.
10
<PAGE 10>
[Application p1]
<PAGE>
[Application p2]
<PAGE>
NOTES
<PAGE>
For More Information
Dreyfus Premier California Municipal Bond Fund
- --------------------------------------
SEC file number: 811-4766
More information on this fund is available free upon request, including the
following:
Annual/Semiannual Report
Describes the fund's performance, lists portfolio holdings and contains a letter
from the fund's manager discussing recent market conditions, economic trends
and fund strategies that significantly affected the fund's performance during
the last fiscal year.
Statement of Additional Information (SAI)
Provides more details about the fund and its policies. A current SAI is on file
with the Securities and Exchange Commission (SEC) and is incorporated by
reference (is legally considered part of this prospectus).
To obtain information:
BY TELEPHONE Call your financial representative or 1-800-554-4611
BY MAIL Write to: The Dreyfus Premier Family of Funds 144 Glenn Curtiss
Boulevard Uniondale, NY 11556-0144
ON THE INTERNET Text-only versions of certain fund documents can be viewed
online or downloaded from: http://www.sec.gov
You can also obtain copies by visiting the SEC's Public Reference Room in
Washington, DC (for information, call 1-202-942-8090) or, after paying a
duplicating fee, by e-mail request to [email protected], or by writing to the
SEC's Public Reference Section, Washington, DC 20549-0102.
(c) 2000 Dreyfus Service Corporation
023P0600
<PAGE>
- --------------------------------------------------------------------------------
DREYFUS PREMIER CALIFORNIA MUNICIPAL BOND FUND
CLASS A, CLASS B AND CLASS C SHARES
STATEMENT OF ADDITIONAL INFORMATION
JUNE 1, 2000
- --------------------------------------------------------------------------------
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus of
Dreyfus Premier California Municipal Bond Fund (the "Fund"), dated June 1, 2000,
as it may be revised from time to time. To obtain a copy of the Fund's
Prospectus, please write to the Fund at 144 Glenn Curtiss Boulevard, Uniondale,
New York 11556-0144, or call 1-800-544-4611.
The Fund's most recent Annual Report and Semi-Annual Report to Shareholders
are separate documents supplied with this Statement of Additional Information,
and the financial statements, accompanying notes and report of independent
auditors appearing in the Annual Report are incorporated by reference into this
Statement of Additional Information.
TABLE OF CONTENTS
Page
Description of the Fund....................................................B-2
Management of the Fund.....................................................B-16
Management Arrangements....................................................B-20
How to Buy Shares..........................................................B-23
Distribution Plan and Shareholder Services Plan............................B-28
How to Redeem Shares.......................................................B-30
Shareholder Services.......................................................B-34
Determination of Net Asset Value...........................................B-38
Dividends, Distributions and Taxes.........................................B-39
Portfolio Transactions.....................................................B-42
Performance Information....................................................B-42
Information About the Fund.................................................B-44
Counsel and Independent Auditors...........................................B-46
Year 2000 Issues...........................................................B-46
Appendix A.................................................................B-47
Appendix B.................................................................B-66
<PAGE>
DESCRIPTION OF THE FUND
The Fund is a Massachusetts business trust that commenced operations on
November 10, 1986. The Fund is an open-end, management investment company, known
as a municipal bond fund. The Fund is a diversified fund, which means that, with
respect to 75% of the Fund's total assets, the Fund will not invest more than 5%
of its assets in the securities of any single issuer.
The Dreyfus Corporation (the "Manager") serves as the Fund's investment
adviser.
Dreyfus Service Corporation (the "Distributor") is the distributor of the
Fund's shares.
Certain Portfolio Securities
The following information supplements and should be read in conjunction
with the Fund's Prospectus.
Municipal Obligations. The Fund will invest primarily in the debt
securities of the State of California, its political subdivisions, authorities
and corporations, the interest from which is, in the opinion of bond counsel to
the issuer, exempt from Federal and State of California personal income taxes
(collectively, "California Municipal Obligations"). To the extent acceptable
California Municipal Obligations are at any time unavailable for investment by
the Fund, the Fund will invest temporarily in other Municipal Obligations (as
defined below). The Fund will invest at least 80% of the value of its net assets
(except when maintaining a temporary defensive position) in Municipal
Obligations. Municipal Obligations are debt obligations issued by states,
territories and possessions of the United States and the District of Columbia
and their political subdivisions, agencies and instrumentalities, or multistate
agencies or authorities, the interest from which is, in the opinion of bond
counsel to the issuer, exempt from Federal income tax. Municipal Obligations
generally include debt obligations issued to obtain funds for various public
purposes as well as certain industrial development bonds issued by or on behalf
of public authorities. Municipal Obligations are classified as general
obligation bonds, revenue bonds and notes. General obligation bonds are secured
by the issuer's pledge of its faith, credit and taxing power for the payment of
principal and interest. Revenue bonds are payable from the revenue derived from
a particular facility or class of facilities or, in some cases, from the
proceeds of a special excise or other specific revenue source, but not from the
general taxing power. Tax exempt industrial development bonds, in most cases,
are revenue bonds that do not carry the pledge of the credit of the issuing
municipality, but generally are guaranteed by the corporate entity on whose
behalf they are issued. Notes are short-term instruments which are obligations
of the issuing municipalities or agencies and are sold in anticipation of a bond
sale, collection of taxes or receipt of other revenues. Municipal Obligations
include municipal lease/purchase agreements which are similar to installment
purchase contracts for property or equipment issued by municipalities. Municipal
Obligations bear fixed, floating or variable rates of interest, which are
determined in some instances by formulas under which the Municipal Obligation's
interest rate will change directly or inversely to changes in interest rates or
an index, or multiples thereof, in many cases subject to a maximum and minimum.
Certain Municipal Obligations are subject to redemption at a date earlier than
their stated maturity pursuant to call options, which may be separated from the
related Municipal Obligation and purchased and sold separately.
The yields on Municipal Obligations are dependent on a variety of factors,
including general economic and monetary conditions, money market factors,
conditions in the Municipal Obligations market, size of a particular offering,
maturity of the obligation, and rating of the issue.
Certain Tax Exempt Obligations. The Fund may purchase floating and variable
rate demand notes and bonds, which are tax exempt obligations ordinarily having
stated maturities in excess of one year, but which permit the holder to demand
payment of principal at any time or at specified intervals. 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 amount 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. Each obligation purchased by
the Fund will meet the quality criteria established for the purchase of
Municipal Obligations.
Tax Exempt Participation Interests. The Fund may purchase from financial
institutions participation interests in Municipal Obligations (such as
industrial development bonds and municipal lease/purchase agreements). A
participation interest gives the Fund an undivided interest in the Municipal
Obligation in the proportion that the Fund's participation interest bears to the
total principal amount of the Municipal Obligation. These instruments may have
fixed, floating or variable rates of interest. If the participation interest is
unrated, it will be backed by an irrevocable letter of credit or guarantee of a
bank that the Fund's Board has determined meet prescribed quality standards for
banks, or the payment obligation otherwise will be collateralized by U.S.
Government securities. For certain participation interests, the Fund will have
the right to demand payment, on not more than seven days' notice, for all or any
part of the Fund's participation interest in the Municipal Obligation, plus
accrued interest. As to these instruments, the Fund intends to exercise its
right to demand payment only upon a default under the terms of the Municipal
Obligation, as needed to provide liquidity to meet redemptions, or to maintain
or improve the quality of its investment portfolio.
Municipal lease obligations or installment purchase contract obligations
(collectively, "lease obligations") have special risks not ordinarily associated
with Municipal Obligations. Although lease obligations do not constitute general
obligations of the municipality for which the municipality's taxing power is
pledged, a lease obligation ordinarily is backed by the municipality's covenant
to budget for, appropriate and make the payments due under the lease obligation.
However, certain lease obligations contain "non-appropriation" clauses which
provide that the municipality has no obligation to make lease or installment
purchase payments in future years unless money is appropriated for such purpose
on a yearly basis. Although "non-appropriation" lease obligations are secured by
the leased property, disposition of the property in the event of foreclosure
might prove difficult. The staff of the Securities and Exchange Commission
currently considers certain lease obligations to be illiquid. Determination as
to the liquidity of such securities is made in accordance with guidelines
established by the Fund's Board. Pursuant to such guidelines, the Board has
directed the Manager to monitor carefully the Fund's investment in such
securities with particular regard to: (1) the frequency of trades and quotes for
the lease obligation; (2) the number of dealers willing to purchase or sell the
lease obligation and the number of other potential buyers; (3) the willingness
of dealers to undertake to make a market in the lease obligation; (4) the nature
of the marketplace trades, including the time needed to dispose of the lease
obligation, the method of soliciting offers and the mechanics of transfer; and
(5) such other factors concerning the trading market for the lease obligation as
the Manager may deem relevant. In addition, in evaluating the liquidity and
credit quality of a lease obligation that is unrated, the Fund's Board has
directed the Manager to consider: (a) whether the lease can be cancelled; (b)
what assurance there is that the assets represented by the lease can be sold;
(c) the strength of the lessee's general credit (e.g., its debt, administrative,
economic, and financial characteristics); (d) the likelihood that the
municipality will discontinue appropriating funding for the leased property
because the property is no longer deemed essential to the operations of the
municipality (e.g., the potential for an "event of nonappropriation"); (e) the
legal recourse in the event of failure to appropriate; and (f) such other
factors concerning credit quality as the Manager may deem relevant.
Tender Option Bonds. The Fund may purchase tender option bonds. A tender option
bond is a Municipal Obligation (generally held pursuant to a custodial
arrangement) having a relatively long maturity and bearing interest at a fixed
rate substantially higher than prevailing short-term tax exempt rates, that has
been coupled with the agreement of a third party, such as a bank, broker-dealer
or other financial institution, pursuant to which such institution grants the
security holders the option, at periodic intervals, to tender their securities
to the institution and receive the face value thereof. As consideration for
providing the option, the financial institution receives periodic fees equal to
the difference between the Municipal Obligation's fixed coupon rate and the
rate, as determined by a remarketing or similar agent at or near the
commencement of such period, that would cause the securities, coupled with the
tender option, to trade at par on the date of such determination. Thus, after
payment of this fee, the security holder effectively holds a demand obligation
that bears interest at the prevailing short-term tax exempt rate. The Manager,
on behalf of the Fund, will consider on an ongoing basis the creditworthiness of
the issuer of the underlying Municipal Obligations, of any custodian and of the
third party provider of the tender option. In certain instances and for certain
tender option bonds, the option may be terminable in the event of a default in
payment of principal or interest on the underlying Municipal Obligations and for
other reasons.
The Fund will purchase tender option bonds only when it is satisfied that
the custodial and tender option arrangements, including the fee payment
arrangements, will not adversely affect the tax exempt status of the underlying
Municipal Obligations and that payment of any tender fees will not have the
effect of creating taxable income for the Fund. Based on the tender option bond
agreement, the Fund expects to be able to value the tender option bond at par;
however, the value of the instrument will be monitored to assure that it is
valued at fair value.
Custodial Receipts. The Fund may purchase custodial receipts representing the
right to receive certain future principal and interest payments on Municipal
Obligations which underlie the custodial receipts. A number of different
arrangements are possible. In a typical custodial receipt arrangement, an issuer
or a third party owner of Municipal Obligations deposits such obligations with a
custodian in exchange for two classes of custodial receipts. The two classes
have different characteristics, but, in each case, payments on the two classes
are based on payments received on the underlying Municipal Obligations. One
class has the characteristics of a typical auction rate security, where at
specified intervals its interest rate is adjusted, and ownership changes, based
on an auction mechanism. This class's interest rate generally is expect to be
below the coupon rate of the underlying Municipal Obligations and generally is
at a level comparable to that of Municipal Obligation of similar quality and
having a maturity equal to the period between interest rate adjustments. The
second class bears interest at a rate that exceeds the interest rate typically
borne by a security of comparable quality and maturity; this rate also is
adjusted, but in this case inversely to changes in the rate of interest of the
first class. In no event will the aggregate interest paid with respect to the
two classes exceed the interest paid by the underlying Municipal Obligations.
The value of the second class and similar securities should be expected to
fluctuate more than the value of a Municipal Obligation of comparable quality
and maturity and their purchase by the Fund should increase the volatility of
its net asset value and, thus, its price per share. These custodial receipts are
sold in private placements. The Fund also may purchase directly from issuers,
and not in a private placement, Municipal Obligations having characteristics
similar to custodial receipts. These securities may be issued as apart of a
multi-class offering and the interest rate on certain classes may be subject to
a cap or floor.
Stand-By Commitments. The Fund may acquire "stand-by commitments" with respect
to Municipal Obligations held in its portfolio. Under a stand-by commitment, the
Fund obligates a broker, dealer or bank to repurchase, at the Fund's option,
specified securities at a specified price and, in this respect, stand-by
commitments are comparable to put options. The exercise of a stand-by
commitment, therefore, is subject to the ability of the seller to make payment
on demand. The Fund will acquire stand-by commitments solely to facilitate
portfolio liquidity and does not intend to exercise its rights thereunder for
trading purposes. The Fund may pay for stand-by commitments if such action is
deemed necessary, thus increasing to a degree the cost of the underlying
Municipal Obligation and similarly decreasing such security's yield to
investors. Gains realized in connection with stand-by commitments will be
taxable. The Fund also may acquire call options on specific Municipal
Obligations. The Fund generally would purchase these call options to protect the
Fund from the issuer of the related Municipal Obligation redeeming, or other
holder of the call option from calling away, the Municipal Obligation before
maturity. The sale by the Fund of a call option that it owns on a specific
Municipal Obligation could result in the receipt of taxable income by the Fund.
Ratings of Municipal Obligations. The Fund will invest at least 70% of the value
of its net assets in Municipal Obligations which, in the case of bonds, are
rated no lower than Baa by Moody's Investors Service, Inc. ("Moody's") or BBB by
Standard & Poor's Ratings Group ("S&P") or Fitch IBCA, Inc. ("Fitch" and,
together with Moody's and S&P, the "Rating Agencies"). The Fund may invest up to
30% of the value of its net assets in Municipal Obligations which, in the case
of bonds, are rated lower than Baa by Moody's and BBB by S&P and Fitch and as
low as the lowest ratings assigned by the Rating Agencies. The Fund also may
invest in securities which, while not rated, are determined by the Manager to be
of comparable quality to the rated securities in which the Fund may invest; for
purposes of the 70% requirement described in this paragraph, such unrated
securities will be considered to have the rating so determined.
The average distribution of investments (at value) in Municipal Obligations
by ratings for the fiscal year ended January 31, 2000, computed on a monthly
basis, was as follows:
Percentage
Fitch or Moody's or S&P of Value
- --------- --------- ----------- -----------
AAA Aaa AAA 44.5%
AA Aa AA 16.6%
A A A 8.8%
BBB Baa BBB 18.7%
BB Ba BB 1.4%
D D D .1%
F-1+/F-1 VMIG1/MIG1, P-1 SP-1+,SP-1,
A1+/A1 5.4%
Not Rated Not Rated Not Rated 4.5%(1)
100.0%
- -----------------------
1 Those securities which are not rated have been determined by the Manager to
be of comparable quality to securities in the following rating categories:
AAA/Aaa (.5%), Baa/BBB (1.4%) and Ba/BB (2.6%).
Subsequent to its purchase by the Fund, an issue of rated Municipal
Obligations may cease to be rated or its rating may be reduced below the minimum
required for purchase by the Fund. Neither event will require the sale of such
Municipal Obligations by the Fund, but the Manager will consider such event in
determining whether the Fund should continue to hold the Municipal Obligations.
To the extent that the ratings given by the Rating Agencies for Municipal
Obligations may change as a result of changes in such organizations or their
rating systems, the Fund will attempt to use comparable ratings as standards for
its investments in accordance with the investment policies contained in the
Prospectus and this Statement of Additional Information. The ratings of the
Rating Agencies represent their opinions as to the quality of the Municipal
Obligations which they undertake to rate. It should be emphasized, however, that
ratings are relative and subjective and are not absolute standards of quality.
Although these ratings may be an initial criterion for selection of portfolio
investments, the Manager also will evaluate these securities and the
creditworthiness of the issuers of such securities.
Taxable Investments. From time to time, on a temporary basis other than for
temporary defensive purposes (but not to exceed 20% of the value of the Fund's
net assets) or for temporary defensive purposes, the Fund may invest in taxable
short-term investments ("Taxable Investments") consisting of: notes of issuers
having, at the time of purchase, a quality rating within the two highest grades
of a Rating Agency; obligations of the U.S. Government, its agencies or
instrumentalities; commercial paper rated not lower than P-1 by Moody's, A-1 by
S&P or F-1 by Fitch; certificates of deposit of U.S. domestic banks, including
foreign branches of domestic banks, with assets of $1 billion or more; time
deposits; bankers' acceptances and other short-term bank obligations; and
repurchase agreements in respect of any of the foregoing. Dividends paid by the
Fund that are attributable to income earned by the Fund from Taxable Investments
will be taxable to investors. See "Dividends, Distributions and Taxes." Except
for temporary defensive purposes, at no time will more than 20% of the value of
the Fund's net assets be invested in Taxable Investments. When the Fund has
adopted a temporary defensive position, including when acceptable California
Municipal Obligations are unavailable for investment by the Fund, in excess of
35% of the Fund's net assets may be invested in securities that are not exempt
from California personal income tax. Under normal market conditions, the Fund
anticipates that not more than 5% of the value of its total assets will be
invested in any one category of Taxable Investments.
Zero Coupon Securities. The Fund may invest in zero coupon securities which
are debt securities issued or sold at a discount from their face value which do
not entitle the holder to any periodic payment of interest prior to maturity or
a specified redemption date (or cash payment date). The amount of the discount
varies depending on the time remaining until maturity or cash payment date,
prevailing interest rates, liquidity of the security and perceived credit
quality of the issuer. Zero coupon securities also may take the form of debt
securities that have been stripped of their unmatured interest coupons, the
coupons themselves and receipts or certificates representing interests in such
stripped debt obligations and coupons. The market prices of zero coupon
securities generally are more volatile than the market prices of securities that
pay interest periodically and are likely to respond to a greater degree to
changes in interest rates than non-zero coupon securities having similar
maturities and credit qualities. Federal income tax law requires the holder of a
zero coupon security or of certain pay-in-kind bonds to accrue income with
respect to these securities prior to the receipt of cash payments. To maintain
its qualification as a regulated investment company and avoid liability for
Federal income taxes, the Fund may be required to distribute such income accrued
with respect to these securities and may have to dispose of portfolio securities
under disadvantageous circumstances in order to generate cash to satisfy these
distribution requirements.
Illiquid Securities. The Fund may invest up to 15% of the value of its net
assets in securities as to which a liquid trading market does not exist,
provided such investments are consistent with the Fund's investment objective.
Such securities may include securities that are not readily marketable, such as
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.
Investment Techniques
The following information supplements and should be read in conjunction
with the Fund's Prospectus. The Fund's use of certain of the investment
techniques described below may give rise to taxable income.
Borrowing Money. The Fund may borrow to the extent permitted under the
Investment Company Act of 1940, as amended (the "1940 Act"), which permits an
investment company to borrow in an amount up to 33-1/3% of the value of its
total assets. The Fund currently intends to borrow money only 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
borrowing is made. While borrowings exceed 5% of the Fund's total assets, the
Fund will not make any additional investments.
Short-Selling. In these transactions, the Fund sells a security it does not
own in anticipation of a decline in the market value of the security. To
complete the transaction, the Fund must borrow the security to make delivery to
the buyer. The Fund is obligated to replace the security borrowed by purchasing
it subsequently at the market price at the time of replacement. The price at
such time may be more or less than the price at which the security was sold by
the Fund, which would result in a loss or gain, respectively.
Securities will not be sold short if, after effect is given to any such
short sale, the total market value of all securities sold short would exceed 25%
of the value of the Fund's net assets. The Fund may not make a short sale which
results in the Fund having sold short in the aggregate more than 5% of the
outstanding securities of any class of an issuer.
The Fund also may make short sales "against the box," in which the Fund
enters into a short sale of a security it owns. At no time will more than 15% of
the value of the Fund's net assets be in deposits on short sales against the
box.
Until the Fund closes its short position or replaces the borrowed security,
the Fund will: (a) segregate permissible liquid assets in an amount that,
together with the amount deposited with the broker as collateral, always equals
the current value of the security sold short; or (b) otherwise cover its short
position.
Derivatives. The Fund may invest in, or enter into, derivatives, such as
options and futures, for a variety of reasons, including to hedge certain market
risks, to provide a substitute for purchasing or selling particular securities
or to increase potential income gain. Derivatives may provide a cheaper, quicker
or more specifically focused way for the Fund to invest than "traditional"
securities would.
Derivatives can be volatile and involve various types and degrees of risk,
depending upon the characteristics of the particular derivative and the
portfolio as a whole. Derivatives permit 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. However, 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 the 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 derivatives subject
the Fund to the rules of the Commodity Futures Trading Commission which limit
the extent to which the Fund can invest in such derivatives. 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.
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 variation margin system operated by the clearing agency
in order to reduce overall credit risk. As a result, unless the clearing agency
defaults, there is relatively little counterparty credit risk associated with
derivatives purchased on an exchange. By contrast, no clearing agency guarantees
over-the-counter derivatives. Therefore, each party to an over-the-counter
derivative bears the risk that the counterparty will default. Accordingly, the
Manager 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.
Futures Transactions--In General. The Fund may enter into futures contracts
in U.S. domestic markets. Engaging in these 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 Manager'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 securities 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 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. In addition, the segregation of such
assets will have the effect of limiting the Fund's ability otherwise to invest
those assets.
Specific Futures Transactions. The 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.
Options--In General. The Fund may invest up to 5% of its assets, represented by
the premium paid, in the purchase of call and put options. The Fund may write
(i.e., sell) covered call and put option contracts to the extent of 20% of the
value of its net assets at the time such option contracts are written. A call
option gives the purchaser of the option the right to buy, and obligates the
writer to sell, the underlying security or securities at the exercise price at
any time during the option period, or at a specific date. Conversely, a put
option gives the purchaser of the option the right to sell, and obligates the
writer to buy, the underlying security or securities at the exercise price at
any time during the option period, or at a specific date.
A covered call option written by the Fund is a call option with respect to
which the Fund owns the underlying security or otherwise covers the transaction
by segregating permissible liquid assets. A put option written by the Fund is
covered when, among other things, the Fund segregates permissible liquid assets
having a value equal to or greater than the exercise price of the option 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.
Successful use by the Fund of options will be subject to the Manager's
ability to predict correctly movements in interest rates. To the extent the
Manager's predictions are incorrect, the Fund may incur losses.
Future Developments. The Fund may take advantage of opportunities in the
area of options and futures contracts and options on futures contracts and any
other derivatives which are not presently contemplated for use by the Fund or
which are not currently available but which may be developed, to the extent such
opportunities are both consistent with the Fund's investment objective and
legally permissible for the Fund. Before entering into such transactions or
making any such investment, the Fund will provide appropriate disclosure in its
Prospectus or this Statement of Additional Information.
Lending Portfolio Securities. The Fund may lend securities from its
portfolio to brokers, dealers and other financial institutions needing to borrow
securities to complete certain transactions. The Fund continues 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.
Forward Commitments. The Fund may purchase or sell Municipal Obligations
and other securities on a forward commitment, when-issued or delayed delivery
basis, which means that delivery and payment take place a number of days after
the date of the commitment to purchase or sell. The payment obligation and the
interest rate receivable on a forward commitment or when-issued security are
fixed when the Fund enters into the commitment, but the Fund does not make
payment until it receives delivery from the counterparty. The Fund will commit
to purchase such securities only with the intention of actually acquiring the
securities, but the Fund may sell these securities before the settlement date if
it is deemed advisable. The Fund will segregate permissible liquid assets at
least equal at all times to the amount of the Fund's purchase commitments.
Municipal Obligations and other securities purchased on a forward
commitment or when-issued basis are subject to changes in value (generally
changing in the same way, i.e., appreciating when interest rates decline and
depreciating when interest rates rise) based upon the public's perception of the
creditworthiness of the issuer and changes, real or anticipated, in the level of
interest rates. Securities purchased on a when-issued basis may expose the Fund
to risks because they may experience such fluctuations prior to their actual
delivery. Purchasing securities on a forward commitment or when-issued basis can
involve the additional risk that the yield available in the market when the
delivery takes place actually may be higher than that obtained in the
transaction itself. Purchasing securities on a forward commitment or when-issued
basis when the Fund is fully or almost fully invested may result in greater
potential fluctuation in the value of the Fund's net assets and its net asset
value per share.
Investment Consideration and Risks
Investing in Municipal Obligations. The Fund may invest more than 25% of
the value of its total assets in Municipal Obligations which are related in such
a way that an economic, business or political development or change affecting
one such security also would affect the other securities; for example,
securities the interest upon which is paid from revenues of similar types of
projects. As a result, the Fund may be subject to greater risk as compared to a
fund that does not follow this practice.
Certain municipal lease/purchase obligations in which the Fund may invest
may contain "non-appropriation" clauses which provide that the municipality has
no obligation to make lease payments in future years unless money is
appropriated for such purpose on a yearly basis. Although "non-appropriation"
lease/purchase obligations are secured by the leased property, disposition of
the leased property in the event of foreclosure might prove difficult. In
evaluating the credit quality of a municipal lease/purchase obligation that is
unrated, the Manager will consider, on an ongoing basis, a number of factors
including the likelihood that the issuing municipality will discontinue
appropriating funding for the leased property.
Certain provisions in the Internal Revenue Code of 1986, as amended (the
"Code"), relating to the issuance of Municipal Obligations may reduce the volume
of Municipal Obligations qualifying for Federal tax exemption. One effect of
these provisions could be to increase the cost of the Municipal Obligations
available for purchase by the Fund and thus reduce available yield. Shareholders
should consult their tax advisers concerning the effect of these provisions on
an investment in the Fund. Proposals that may restrict or eliminate the income
tax exemption for interest on Municipal Obligations may be introduced in the
future. If any such proposal were enacted that would reduce the availability of
Municipal Obligations for investment by the Fund so as to adversely affect Fund
shareholders, the Fund would reevaluate its investment objective and policies
and submit possible changes in the Fund's structure to shareholders for their
consideration. If legislation were enacted that would treat a type of Municipal
Obligation as taxable, the Fund would treat such security as a permissible
Taxable Investment within the applicable limits set forth herein.
Investing in California Municipal Obligations. Since the Fund is
concentrated in securities issued by California or entities within California,
an investment in the Fund may involve greater risk than investments in certain
other types of municipal bond funds. You should consider carefully the special
risks inherent in the Fund's investment in California Municipal Obligations. You
should review "Appendix A" which sets forth information relating to investing in
California Municipal Obligations.
Lower Rated Bonds. The Fund may invest up to 30% of its net assets in
higher yielding (and, therefore, higher risk) debt securities, such as those
rated below investment grade by the Rating Agencies (commonly known as "high
yield" or "junk" bonds). They may be subject to greater risks and market
fluctuations than certain lower yielding, higher rated Municipal Obligations.
See "Appendix B" for a general description of the Rating Agencies' ratings of
Municipal Obligations. Although ratings may be useful in evaluating the safety
of interest and principal payments, they do not evaluate the market value risk
of these bonds. The Fund will rely on the Manager's judgment, analysis and
experience in evaluating the creditworthiness of an issuer.
You should be aware that the market values of many of these bonds tend to
be more sensitive to economic conditions than are higher rated securities. These
bonds generally are considered by the Rating Agencies to be, on balance,
predominantly speculative with respect to capacity to pay interest and repay
principal in accordance with the terms of the obligation and generally will
involve more credit risk than securities in the higher rating categories.
Because there is no established retail secondary market for many of these
securities, the Fund anticipates that such securities could be sold only to a
limited number of dealers or institutional investors. To the extent a secondary
trading market for these bonds does exist, it generally is not as liquid as the
secondary market for higher rated securities. The lack of a liquid secondary
market may have an adverse impact on market price and yield and the Fund's
ability to dispose of particular issues when necessary to meet the Fund's
liquidity needs or in response to a specific economic event such as a
deterioration in the creditworthiness of the issuer. The lack of a liquid
secondary market for certain securities also may make it more difficult for the
Fund to obtain accurate market quotations for purposes of valuing the Fund's
portfolio and calculating its net asset value. Adverse publicity and investor
perceptions, whether or not based on fundamental analysis, may decrease the
values and liquidity of these securities. In such cases, the Manager's judgment
may play a greater role in valuation because less reliable, objective data may
be available.
These bonds may be particularly susceptible to economic downturns. It is
likely that any economic recession would disrupt severely the market for such
securities and have an adverse impact on the value of such securities, and could
adversely affect the ability of the issuers of such securities to repay
principal and pay interest thereon which would increase the incidence of default
for such securities.
The Fund may acquire these bonds during an initial offering. Such
securities may involve special risks because they are new issues. The Fund has
no arrangement with any persons concerning the acquisition of such securities,
and the Manager will review carefully the credit and other characteristics
pertinent to such new issues.
The credit risk factors pertaining to lower rated securities also apply to
lower rated zero coupon bonds and pay-in-kind bonds, in which the Fund may
invest up to 5% of its net assets. Zero coupon securities and pay-in-kind or
delayed interest bonds carry an additional risk in that, unlike bonds which pay
interest throughout the period to maturity, the Fund will realize no cash until
the cash payment date unless a portion of such securities are sold and, if the
issuer defaults, the Fund may obtain no return at all on its investment. See
"Dividends, Distributions and Taxes."
Simultaneous Investments. Investment decisions for the Fund are made
independently from those of other investment companies advised by the Manager.
If, however, such other investment companies desire to invest in, or dispose of,
the same securities as the 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.
Investment Restrictions
The Fund's investment objective is a fundamental policy, which cannot be
changed without approval by the holders of a majority (as defined in the 1940
Act) of the Fund's outstanding voting shares. In addition, the Fund has adopted
investment restrictions numbered 1 through 10 as fundamental policies.
Investment restrictions numbered 11 and 12 are not fundamental policies and may
be changed by vote of a majority of the Fund's Board members at any time. The
Fund may not:
1. Purchase securities other than Municipal Obligations and Taxable
Investments as those terms are defined above and in the Prospectus and those
arising out of transactions in futures and options.
2. 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
total assets). Transactions in futures and options and the entry into short
sales transactions do not involve any borrowing for purposes of this
restriction.
3. Purchase securities on margin, but the Fund may make margin deposits in
connection with transactions in futures, including those related to indices, and
options on futures or indices.
4. Underwrite the securities of other issuers, except that the Fund may bid
separately or as part of a group for the purchase of Municipal Obligations
directly from an issuer for its own portfolio to take advantage of the lower
purchase price available, and 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.
5. Purchase or sell real estate, real estate investment trust securities,
commodities or commodity contracts, or oil and gas interests, but this shall not
prevent the Fund from investing in Municipal Obligations secured by real estate
or interests therein, or prevent the Fund from purchasing and selling futures
contracts, including those related to indices, and options on futures contracts
or indices.
6. Make loans to others, except through the purchase of qualified debt
obligations and the entry into repurchase agreements referred to above and in
the Fund's Prospectus; however, the Fund may lend its portfolio securities in an
amount not to exceed 33-1/3% of the value of its total assets. Any loans of
portfolio securities will be made according to guidelines established by the
Securities and Exchange Commission and the Fund's Trustees.
7. Invest more than 15% of its assets in the obligations of any one bank
for temporary defensive purposes, or invest more than 5% of its assets in the
obligations of any other issuer, except that up to 25% of the value of the
Fund's total assets may be invested, and securities issued or guaranteed by the
U.S. Government or its agencies or instrumentalities may be purchased, without
regard to any such limitations. 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, except
that up to 25% of the value of the Fund's total assets may be invested without
regard to such limitation.
8. Invest more than 25% of its total assets in the securities of issuers in
any single industry; provided that there shall be no such limitation on the
purchase of Municipal Obligations and, for temporary defensive purposes,
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities.
9. Invest in companies for the purpose of exercising control.
10. Invest in securities of other investment companies, except as they may
be acquired as part of a merger, consolidation or acquisition of assets.
11. Pledge, mortgage, hypothecate or otherwise encumber its assets, except
to the extent necessary to secure permitted borrowings. The deposit of assets in
escrow in connection with the writing of covered put and call options and the
purchase of securities on a when-issued or delayed-delivery basis and collateral
arrangements with respect to initial or variation margin for futures contracts
and options on futures contracts or indices will not be deemed to be pledges of
the Fund's assets.
12. Enter into repurchase agreements providing for settlement in more than
seven days after notice or purchase securities which are illiquid (which
securities could include participation interests that are not subject to the
demand feature described in the Fund's Prospectus or the Statement of Additional
Information and floating and variable rate demand obligations as to which no
secondary market exists and the Fund cannot exercise the demand feature
described in the Fund's Prospectus or the Statement of Additional Information on
less than seven days' notice), if, in the aggregate, more than 15% of the value
of its net assets would be so invested.
For purposes of Investment Restriction No. 8, industrial development bonds,
where the payment of principal and interest is the ultimate responsibility of
companies within the same industry, are grouped together as an "industry."
If a percentage restriction is adhered to at the time of investment, a
later increase in percentage resulting from a change in values or assets will
not constitute a violation of such restriction.
MANAGEMENT OF THE FUND
The Fund's Board is responsible for the management and supervision of the
Fund. The Board approves all significant agreements between the Fund and those
companies that furnish services to the Fund. These companies are as follows:
The Dreyfus Corporation...................Investment Adviser
Dreyfus Service Corporation......................Distributor
Dreyfus Transfer, Inc.........................Transfer Agent
The Bank of New York...............................Custodian
Board members and officers of the Fund, together with information as to
their principal business occupations during at least the last five years, are
shown below.
Board Members of the Fund
JOSEPH S. DiMARTINO, Chairman of the Board. Since January 1995, Chairman of the
Board of various funds in the Dreyfus Family of Funds. He also is a
director of The Muscular Dystrophy Association, HealthPlan Services
Corporation, a provider of marketing, administrative and risk management
services to health and other benefit programs, Carlyle Industries, Inc.
(formerly, Belding Heminway, Inc.), a button packager and distributor,
Century Business Services, Inc. (formerly, International Alliance Services,
Inc.), a provider of various outsourcing functions for small and medium
sized companies, and QuikCAT.com, Inc., a private company engaged in the
development of high speed movement, routing, storage and encryption of data
across all modes of data transport. 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 the Distributor. From August 1994 until December 31, 1994, he
was a director of Mellon Financial Corporation. He is 56 years old and his
address is 200 Park Avenue, New York, New York 10166.
CLIFFORD L. ALEXANDER, JR., Board Member. Chairman of the Board and Chief
Executive Officer of The Dun and Bradstreet Corporation. 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, IMS
Health, a service provider of marketing information and information
technology, The Dun & Bradstreet Corporation, MCI WorldCom and Mutual of
America Life Insurance Company. He is 66 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 56 years old and
her address is c/o New York University School of Law, 40 Washington Square
South, New York, New York 10012.
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, including President
of The New York Psychoanalytic Society, and has published many articles on
subjects in the field of psychoanalysis. He is 67 years old and his address
is 23 East 92nd Street, New York, New York 10128.
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 to 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 served as Chairman of Citizens Union, an
organization which strives to reform and modernize city and state
government from June 1994 until June 1997. He is 57 years old and his
address is 70 Lincoln Center Plaza, New York, New York 10023-6583.
The Fund has a standing nominating committee comprised of its Board members
who are not "interested persons" of the Fund, as defined in the 1940 Act. The
function of the nominating committee is to select and nominate all candidates
who are not "interested persons" of the Fund for election to the Fund's Board.
The Fund typically pays its Board members an annual retainer and a per
meeting fee and reimburses them for their expenses. The Chairman of the Board
receives an additional 25% of such compensation. Emeritus Board members are
entitled to receive an annual retainer and a per meeting fee of one-half the
amount paid to them as Board members. The aggregate amount of compensation paid
to each Board member by the Fund for the fiscal year ended January 31, 2000, and
by all 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, 1999, were as
follows:
Total Compensation
Aggregate from Fund and Fund
Name of Board Compensation from Complex Paid to
Member Fund** Board Member
- ---------------------------- ------------------ -----------------------
Joseph S. DiMartino $ 6,250 $642,177 (189)
Clifford L. Alexander, Jr. $ 5,000 $ 85,378 (43)
Peggy C. Davis $ 5,000 $ 68,378 (29)
Ernest Kafka $ 5,000 $ 68,378 (29)
Saul B. Klaman*** $ 4,702 $ 68,378 (29)
Nathan Leventhal $ 5,000 $ 68,378 (29)
- -------------------------
* Represents the number of separate portfolios comprising the investment
companies in the Fund Complex, including the Fund, for which the Board
member serves.
** Amount does not include reimbursed expenses for attending Board meetings,
which amounted to $1,072 for all Board members as a group.
*** Emeritus Board member as of January 18, 2000.
Officers of the Fund
STEPHEN E. CANTER, President. President, Chief Operating Officer, Chief
Investment Officer and a director of the Manager, and an officer of other
investment companies advised and administered by the Manager. Mr. Canter
also is a Director or an Executive Committee Member of the other investment
management subsidiaries of Mellon Financial Corporation, each of which is
an affiliate of the Manager. He is 54 years old.
MARK N. JACOBS, Vice President. Vice President, General Counsel and Secretary of
the Manager, and an officer of other investment companies advised and
administered by the Manager. He is 54 years old.
JOSEPH CONNOLLY, Vice President and Treasurer. Director - Mutual Fund Accounting
of the Manager, and an officer of other investment companies advised and
administered by the Manager. He is 42 years old.
STEVEN F. NEWMAN, Secretary. Associate General Counsel and Assistant Secretary
of the Manager, and an officer of other investment companies advised and
administered by the Manager. He is 50 years old.
MICHAEL A. ROSENBERG, Assistant Secretary. Associate General Counsel of the
Manager, and an officer of other investment companies advised and
administered by the Manager. He is 40 years old.
JANETTE E. FARRAGHER, Assistant Secretary. Assistant General Counsel of the
Manager, and an officer of other investment companies advised and
administered by the Manager. She is 37 years old.
GREGORY S. GRUBER, Assistant Treasurer. Senior Accounting Manager - Municipal
Bond Funds of the Manager, and an officer of other investment companies
advised and administered by the Manager. He is 40 years old.
The address of each officer of the Fund is 200 Park Avenue, New York, New
York 10166.
The Fund's Board members and officers, as a group, owned less than 1% of
the Fund's shares outstanding on May 1, 2000.
As of May 1, 2000, the following entities owned of record 5% or more of the
outstanding shares of beneficial interest of the Fund: Class A shares - MLPF&S
for the Sole Benefit of its Customers, 4800 Deer Lake Drive E Fl 3,
Jacksonville, Florida 32246-6484 - 7.76%; Class B shares - MLPF&S for the Sole
Benefit of its Customers, 4800 Deer Lake Drive E Fl 3, Jacksonville, Florida
32246-6484 - 10.35%; Prudential Securities Inc. FBO Dr. H. Barton Apfelbaum,
Mrs. Sharon J. Apfelbaum CO-TTEES, Apfelbaum Family Trust UA DTD 03/06/90, Palm
Springs, CA 92262-5748 - 6.51%; Class C shares - MLPF&S for the Sole Benefit of
its Customers, 4800 Deer Lake Drive E Fl 3, Jacksonville, Florida 32246-6484 -
39.51%; Dean Witter for the Benefit of Leo S. Kolligan, P. O. Box 250, Church
Street Station, New York, NY 10008-0250 -25.33%; Dean Witter for the Benefit of
David A. Kempski, P.O. Box 250, Church Street Station, New York, NY 10008-0250 -
17.01%. A shareholder who beneficially owns, directly or indirectly, 25% or more
of the Fund's voting securities may be deemed to be a "control person" (as
defined in the 1940 Act) of the Fund.
MANAGEMENT ARRANGEMENTS
Investment Adviser. The Manager is a wholly-owned subsidiary of Mellon
Bank, N.A., which is a wholly-owned subsidiary of Mellon Financial Corporation
("Mellon"). Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international markets.
Mellon is among the twenty-five largest bank holding companies in the United
States based on total assets.
The Manager provides management services pursuant to the Management
Agreement (the "Agreement") between the Manager and the 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 outstanding voting securities of the Fund,
provided that in either event the continuance also is approved by a majority of
the Board members who are not "interested persons" (as defined in the 1940 Act)
of the Fund or the Manager, by vote cast in person at a meeting called for the
purpose of voting on such approval. The Agreement 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 outstanding shares, or, on not less than 90 days' notice, by the
Manager. The Agreement will terminate automatically in the event of its
assignment (as defined in the 1940 Act).
The following persons are officers and/or directors of the Manager:
Christopher M. Condron, Chairman of the Board and Chief Executive Officer;
Stephen E. Canter, President, Chief Operating Officer, Chief Investment Officer
and a director; Thomas F. Eggers, Vice Chairman - Institutional and a director;
Lawrence S. Kash, Vice Chairman; J. David Officer, Vice Chairman and a director;
Ronald P. O'Hanley III, Vice Chairman; William T. Sandalls, Jr., Executive Vice
President; Stephen R. Byers, Senior Vice President; Patrice M. Kozlowski, Senior
Vice President - Corporate Communications; Mark N. Jacobs, Vice President,
General Counsel and Secretary; Diane P. Durnin, Vice President - Product
Development; Mary Beth Leibig, Vice President - Human Resources; Ray Van Cott,
Vice President - Information Systems; Theodore A. Schachar, Vice President -
Tax; Wendy Strutt, Vice President; William H. Maresca, Controller; James
Bitetto, Assistant Secretary; Steven F. Newman, Assistant Secretary; and Mandell
L. Berman, Burton C. Borgelt, Steven G. Elliott, Martin C. McGuinn, Richard W.
Sabo and Richard F. Syron, directors.
Mellon Bank, N.A., the Manager's parent, and its affiliates may have
deposit, loan, and commercial banking or other relationships with the issuers of
securities purchased by the Fund. The Manager has informed the Fund that in
making its investment decisions it does not obtain or use material inside
information that Mellon Bank, N.A. or its affiliates may possess with respect to
such issuers.
The Manager's Code of Ethics (the "Code") subjects its employees' personal
securities transactions to various restrictions to ensure that such trading does
not disadvantage any fund advised by the Manager. In that regard, portfolio
managers and other investment personnel of the Manager must preclear and report
their personal securities transactions and holdings, which are reviewed for
compliance with the Code and are also subject to the oversight of Mellon's
Investment Ethics Committee. Portfolio managers and other investment personnel
of the Manager who comply with the Code's preclearance and disclosure procedures
and the requirements of the Committee may be permitted to purchase, sell or hold
securities which also may be or are held in fund(s) they manage or for which
they otherwise provide investment advice.
The Manager manages the 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 the Fund with
portfolio managers who are authorized by the Fund's Board to execute purchases
and sales of securities. The Fund's portfolio managers are Joseph P. Darcy, A.
Paul Disdier, Douglas J. Gaylor, Joseph Irace, Richard J. Moynihan, Colleen
Meehan, W. Michael Petty, Jill C. Shaffro, Scott Sprauer, Samuel J. Weinstock
and Monica S. Wieboldt. The Manager also maintains a research department with a
professional staff of portfolio managers and securities analysts who provide
research services for the Fund as well as for other funds advised by the
Manager.
The Manager maintains office facilities on behalf of the Fund, and
furnishes statistical and research data, clerical help, accounting, data
processing, bookkeeping and internal auditing and certain other required
services to the Fund. The Manager may pay the Distributor for shareholder
services from the Manager's own assets, including past profits but not including
the management fee paid by the Fund. The Distributor may use part or all of such
payments to pay Service Agents (as defined below) in respect of these services.
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 the Fund are borne by the Fund,
except to the extent specifically assumed by the Manager. The expenses borne by
the Fund include without limitation, the following: 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, advisory fees, charges of custodians, transfer and
dividend disbursing agents' fees, certain insurance premiums, industry
association fees, outside auditing and legal expenses, costs of independent
pricing services, costs of maintaining the Fund's existence, costs attributable
to investor services (including, without limitation, telephone and personnel
expenses), costs of preparing and printing prospectuses and statements of
additional information for regulatory purposes and for distribution to existing
shareholders, costs of shareholders' reports and meetings and any extraordinary
expenses. In addition, shares of each Class are subject to an annual service fee
and Class B and Class C shares are subject to an annual distribution fee. See
"Distribution Plan and Shareholder Services Plan."
As compensation for the Manager's services to the Fund, the Fund has agreed
to pay the Manager a monthly management fee at the annual rate of 0.55% of the
value of the Fund's average daily net assets. For the fiscal years ended January
31, 1998, 1999 and 2000, the management fees paid by the Fund amounted to
$1,000,358, $945,926 and $832,033, respectively.
The Manager has agreed that if in any fiscal year the aggregate expenses of
the Fund, exclusive of taxes, brokerage fees, interest on borrowings and (with
the prior written consent of the necessary state securities commissions)
extraordinary expenses, but including the management fee, exceed the expense
limitation of any state having jurisdiction over the Fund, the Fund may deduct
from the payment to be made to the Manager under the Agreement, or the Manager
will bear, such excess expense to the extent required by state law. 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.
The aggregate of the fees payable to the Manager is not subject to
reduction as the value of the Fund's net assets increases.
Distributor. The Distributor, a wholly-owned subsidiary of the Manager
located at 200 Park Avenue, New York, New York, 10166, serves as the Fund's
distributor on a best efforts basis pursuant to an agreement which is renewable
annually.
From August 23, 1994 through March 21, 2000, Premier Mutual Fund Services,
Inc. ("Premier") acted as the Fund's distributor. For the fiscal years ended
January 31, 1998, 1999, and 2000, the Distributor retained $5,509, $9,504 and
$5,380, respectively, from sales loads on Class A shares and $50,705, $30,597
and $39,432, respectively, from contingent deferred sales charges ("CDSC") on
Class B shares. For the fiscal years ended January 31, 1998, 1999 and 2000, the
Distributor retained $0, $1,222 and $23, respectively, from the CDSC on Class C
shares.
The Distributor, at its expense, may provide promotional incentives to
dealers that sell shares of funds advised by the Manager which are sold with a
sales load, such as the Dreyfus Premier Funds. In some instances, those
incentives may be offered only to certain dealers who have sold or may sell
significant amounts of shares.
Transfer and Dividend Disbursing Agent and Custodian. Dreyfus Transfer,
Inc. (the "Transfer Agent"), a wholly-owned subsidiary of the Manager, P.O. Box
9671, Providence, Rhode Island 02940-9671, is the Fund's transfer and dividend
disbursing agent. Under a transfer agency agreement with the Fund, the Transfer
Agent arranges for the maintenance of shareholder account records for the Fund,
the handling of certain communications between shareholders and the Fund and the
payment of dividends and distributions payable by the Fund. For these services,
the Transfer Agent receives a monthly fee computed on the basis of the number of
shareholder accounts it maintains for the Fund during the month, and is
reimbursed for certain out-of-pocket expenses.
The Bank of New York (the "Custodian"), 100 Church Street, New York, New
York 10286, is the Fund's custodian. The Custodian has no part in determining
the investment policies of the Fund or which securities are to be purchased or
sold by the Fund. Under a custody agreement with the Fund, the Custodian holds
the Fund's securities and keeps all necessary accounts and records. For its
custody services, the Custodian receives a monthly fee based on the market value
of the Fund's assets held in custody and receives certain securities
transactions charges.
HOW TO BUY SHARES
General. Fund shares may be purchased only by clients of certain financial
institutions (which may include banks), securities dealers ("Selected Dealers")
and other industry professionals (collectively, "Service Agents"), except that
full-time or part-time employees of the Manager or any of its affiliates or
subsidiaries, directors of the Manager, Board members of a fund advised by the
Manager, including members of the Fund's Board, or the spouse or minor child of
any of the foregoing may purchase Class A shares directly through the
Distributor. Subsequent purchases may be sent directly to the Transfer Agent or
your Service Agent.
When purchasing Fund shares, you must specify which Class is being
purchased. Share certificates are issued only upon your written request. It is
not recommended that the Fund be used as a vehicle for Keogh, IRA or other
qualified plans. No certificates are issued for fractional shares. The Fund
reserves the right to reject any purchase order.
Service Agents may receive different levels of compensation for selling
different Classes of shares. Management understands that some Service Agents may
impose certain conditions on their clients which are different from those
described in the Fund's Prospectus and this Statement of Additional Information,
and, to the extent permitted by applicable regulatory authority, may charge
their clients direct fees. You should consult your Service Agent in this regard.
The minimum initial investment is $1,000. Subsequent investments must be at
least $100. The Fund reserves the right to vary further the initial and
subsequent investment minimum requirements at any time.
Fund shares also may be purchased through Dreyfus-Automatic Asset
Builder(R) and Dreyfus Government Direct Deposit Privilege 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.
Fund shares are sold on a continuous basis. Net asset value per share is
determined as of the close of trading on the floor of the New York Stock
Exchange (currently 4:00 p.m., New York time), on each day the New York Stock
Exchange is open for business. For purposes of determining net asset value,
options and futures contracts will be valued 15 minutes after the close of
trading on the floor of the New York Stock Exchange. 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. The Fund's investments are
valued based on market value or, where market quotations are not readily
available, based on fair value as determined in good faith by the Fund's Board.
For further information regarding the methods employed in valuing the Fund's
investments, see "Determination of Net Asset Value."
If an order is received in proper form by the Transfer Agent or other
entity authorized to receive orders on behalf of the Fund by the close of
trading on the floor of the New York Stock Exchange (currently 4:00 p.m., New
York time) on a business day, Fund shares will be purchased at the public
offering price determined as of the close of trading on the floor of the New
York Stock Exchange on that day. Otherwise, Fund shares will be purchased at the
public offering price determined as of the close of trading on the floor of the
New York Stock Exchange on the next business day, except where shares are
purchased through a dealer as provided below.
Orders for the purchase of Fund shares received by dealers by the close of
trading on the floor of the New York Stock Exchange on any business day and
transmitted to the Distributor or its designee by the close of its business day
(normally 5:15 p.m., New York time) will be based on the public offering price
per share determined as of the close of trading on the floor of the New York
Stock Exchange on that day. Otherwise, the orders will be based on the next
determined public offering price. It is the dealer's responsibility to transmit
orders so that they will be received by the Distributor or its designee before
the close of its business day.
Class A Shares. The public offering price for Class A shares is the net
asset value per share of that Class plus a sales load as shown below:
<TABLE>
<CAPTION>
TOTAL SALES LOAD
-----------------------------------------------
AS A % OF AS A % OF DEALERS' REALLOWANCE
AMOUNT OF TRANSACTION OFFERING PRICE NET ASSET VALUE AS A % OF
- --------------------- PER SHARE PER SHARE OFFERING PRICE
<S> <C> <C> <C>
Less than $50,000 4.50 4.70 4.25
$50,000 to less than $100,000 4.00 4.20 3.75
$100,000 to less than $250,000 3.00 3.10 2.75
$250,000 to less than $500,000 2.50 2.60 2.25
$500,000 to less than $1,000,000 2.00 2.00 1.75
$1,000,000 or more -0- -0- -0-
</TABLE>
A CDSC of 1% will be assessed at the time of redemption of Class A shares
purchased without an initial sales charge as part of an investment of at least
$1,000,000 and redeemed within one year of purchase. The Distributor may pay
Service Agents an amount up to 1% of the net asset value of Class A shares
purchased by their clients that are subject to a CDSC.
The scale of sales loads applies to purchases of Class A shares made by any
"purchaser," which term includes an individual and/or spouse purchasing
securities for his, her or their own account or for the account of any minor
children, or a trustee or other fiduciary purchasing securities for a single
trust estate or a single fiduciary account (including a pension, profit-sharing
or other employee benefit trust created pursuant to a plan qualified under
Section 401 of the Code) although more than one beneficiary is involved; or a
group of accounts established by or on behalf of the employees of an employer or
affiliated employers pursuant to an employee benefit plan or other program
(including accounts established pursuant to Sections 403(b), 408(k), and 457 of
the Code); or an organized group which has been in existence for more than six
months, provided that it is not organized for the purpose of buying redeemable
securities of a registered investment company and provided that the purchases
are made through a central administration or a single dealer, or by other means
which result in economy of sales effort or expense.
Set forth below is an example of the method of computing the offering price
of the Fund's Class A shares. The example assumes a purchase of Class A shares
aggregating less than $50,000 subject to the schedule of sales charges set forth
above at a price based upon the net asset value of the Fund's Class A shares on
January 31, 2000:
NET ASSET VALUE per Share.............................$11.13
Per Share Sales Charge - 4.5%
of offering price (4.7% of
net asset value per share).........................$ .52
--------
Per Share Offering Price to
the Public.........................................$11.65
======
Full-time employees of NASD member firms and full-time employees of other
financial institutions which have entered into an agreement with the Distributor
pertaining to the sale of Fund shares (or which otherwise have a brokerage
related or clearing arrangement with an NASD member firm or financial
institution with respect to the sale of such shares) may purchase Class A shares
for themselves directly or pursuant to an employee benefit plan or other
program, or for their spouses or minor children, at net asset value, provided
they have furnished the Distributor with such information as it may request from
time to time in order to verify eligibility for this privilege. This privilege
also applies to full-time employees of financial institutions affiliated with
NASD member firms whose full-time employees are eligible to purchase Class A
shares at net asset value. In addition, Class A shares are offered at net asset
value to full-time or part-time employees of the Manager or any of its
affiliates or subsidiaries, directors of the Manager, Board members of a fund
advised by the Manager, including members of the Fund's Board, or the spouse or
minor child of any of the foregoing.
Class A shares may be purchased at net asset value through certain
broker-dealers and other financial institutions which have entered into an
agreement with the Distributor, which includes a requirement that such shares be
sold for the benefit of clients participating in a "wrap account" or a similar
program under which such clients pay a fee to such broker-dealer or other
financial institution.
Class A shares also may be purchased at net asset value, subject to
appropriate documentation, through a broker-dealer or other financial
institution with the proceeds from the redemption of shares of a registered
open-end management investment company not managed by the Manager or its
affiliates. The purchase of Class A shares of the Fund must be made within 60
days of such redemption and the shareholder must have been subject to an initial
sales charge or a contingent deferred sales charge with respect to such redeemed
shares.
Class A shares also may be purchased at net asset value, subject to
appropriate documentation, by (i) qualified separate accounts maintained by an
insurance company pursuant to the laws of any State or territory of the United
States, (ii) a State, county or city or instrumentality thereof, (iii) a
charitable organization (as defined in Section 501(c)(3) of the Code) investing
$50,000 or more in Fund shares, and (iv) a charitable remainder trust (as
defined in Section 501(c)(3) of the Code).
Class B Shares. The public offering price for Class B shares is the net
asset value per share of that Class. No initial sales charge is imposed at the
time of purchase. A CDSC is imposed, however, on certain redemptions of Class B
shares as described in the Fund's Prospectus and in this Statement of Additional
Information under "How to Redeem Shares--Contingent Deferred Sales Charge--Class
B Shares." The Distributor compensates certain Service Agents for selling Class
B shares at the time of purchase from the Distributor's own assets. The proceeds
of the CDSC and the distribution fee, in part, are used to defray these
expenses.
Approximately six years after the date of purchase, Class B shares
automatically will convert to Class A shares, based on the relative net asset
values for shares of each such Class. Class B shares that have been acquired
through the reinvestment of dividends and distributions will be converted on a
pro rata basis together with other Class B shares, in the proportion that a
shareholder's Class B shares converting to Class A shares bears to the total
Class B shares not acquired through the reinvestment of dividends and
distributions.
Class C Shares. The public offering price for Class C shares is the net
asset value per share of that Class. No initial sales charge is imposed at the
time of purchase. A CDSC is imposed, however, on redemptions of Class C shares
made within the first year of purchase. See "How to Redeem Shares." The
Distributor compensates certain Service Agents for selling Class C shares at the
time of purchase from the Distributor's own assets. The proceeds of the CDSC and
the distribution fee, in part, are used to defray these expenses.
Right of Accumulation -- Class A Shares. Reduced sales loads apply to any
purchase of Class A shares, shares of other funds in the Dreyfus Premier Family
of Funds which are sold with a sales load, shares of certain other funds advised
by the Manager or Founders Asset Management LLC ("Founders"), an affiliate of
Manager, which are sold with a sales load and shares acquired by a previous
exchange of such shares (hereinafter referred to as "Eligible Funds"), by you
and any related "purchaser" as defined above, where the aggregate investment,
including such purchase, is $50,000 or more. If, for example, you previously
purchased and still hold Class A shares, or shares of any other Eligible Fund or
combination thereof, with an aggregate current market value of $40,000 and
subsequently purchase Class A shares or shares of an Eligible Fund having a
current value of $20,000, the sales load applicable to the subsequent purchase
would be reduced to 4.0% of the offering price. All present holdings of Eligible
Funds may be combined to determine the current offering price of the aggregate
investment in ascertaining the sales load applicable to each subsequent
purchase.
To qualify for reduced sales loads, at the time of purchase you or your
Service Agent must notify the Distributor if orders are made by wire, or the
Transfer Agent if orders are made by mail. The reduced sales load is subject to
confirmation of your holdings through a check of appropriate records.
Using Federal Funds. The Transfer Agent or the Fund may attempt to notify
you 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 you are a
customer of a Selected Dealer and your order to purchase Fund shares is paid for
other than in Federal Funds, the Selected Dealer, acting on your behalf, will
complete the conversion into, or itself advance, Federal Funds generally on the
business day following receipt of your 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 you with sufficient Federal Funds or a cash balance in
your brokerage account with a Selected Dealer will become effective on the day
that your order, including Federal Funds, is received by the Transfer Agent.
Dreyfus TeleTransfer Privilege. You may purchase shares by telephone 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. The proceeds will be transferred between the bank account designated in
one of these documents and your Fund account. Only a bank account maintained in
a domestic financial institution which is an Automated Clearing House ("ACH")
member may be so designated.
Dreyfus TeleTransfer purchase orders may be made at any time. Purchase
orders received by 4:00 p.m., New York time, on any day the Transfer Agent and
the New York Stock Exchange are open for business will be credited to the
shareholder's Fund account on the next bank business day following such purchase
order. Purchase orders made after 4:00 p.m., New York time, on any day the
Transfer Agent and the New York Stock Exchange are open for business, or orders
made on Saturday, Sunday or any Fund holiday (e.g., when the New York Stock
Exchange is not open for business), will be credited to the shareholder's Fund
account on the second bank business day following such purchase order. To
qualify to use the Dreyfus TeleTransfer Privilege, the initial payment for
purchase of shares must be drawn on, and redemption proceeds paid to, the same
bank and account as are designated on the Account Application or Shareholder
Services Form on file. If the proceeds of a particular redemption are to be
wired to an account at any other bank, the request must be in writing and
signature-guaranteed. See "How to Redeem Shares--Dreyfus TeleTransfer
Privilege."
Reopening an Account. You 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.
DISTRIBUTION PLAN AND SHAREHOLDER SERVICES PLAN
Class B and Class C shares are subject to a Distribution Plan and Class A,
Class B and Class C shares are subject to a Shareholder Services Plan.
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. The Fund's Board has adopted such a
plan (the "Distribution Plan") with respect to the Fund's Class B and Class C
shares, pursuant to which the Fund pays the Distributor for distributing each
such Class of shares a fee at the annual rate of 0.50% of the value of the
average daily net assets of Class B and 0.75% of the value of the average daily
net assets of Class C. The Fund's Board believes that there is a reasonable
likelihood that the Distribution Plan will benefit the Fund and holders of its
Class B and Class C shares.
A quarterly report of the amounts expended under the Distribution Plan, and
the purposes for which such expenditures were incurred, must be made to the
Board for its review. In addition, the Distribution Plan provides that it may
not be amended to increase materially the costs which holders of Class B or
Class C shares may bear for distribution pursuant to the Distribution Plan
without the approval of such shareholders and that other material amendments of
the Distribution 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
Distribution Plan or in any agreements entered into in connection with the
Distribution Plan, by vote cast in person at a meeting called for the purpose of
considering such amendments. The Distribution 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 Distribution Plan. As to the relevant Class of shares
of the Fund, the Distribution Plan may be terminated 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 Distribution Plan
or in any agreements entered into in connection with the Distribution Plan or by
vote of holders of a majority of such Class of shares.
For the fiscal year ended January 31, 2000, the Fund paid $88,629 and
$8,984, with respect to Class B and Class C shares, respectively, pursuant to
the Distribution Plan.
Shareholder Services Plan. The Fund has adopted a Shareholder Services Plan
pursuant to which the Fund pays the Distributor for the provision of certain
services to the holders of the Fund's Class A, Class B and Class C shares a fee
at the annual rate of 0.25% of the value of the average daily net assets of each
such Class. 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 the Shareholder Services Plan,
the Distributor may make payments to Service Agents in respect of these
services.
A quarterly report of the amounts expended under the Shareholder Services
Plan, and the purposes for which such expenditures were incurred, must be made
to the Board for its review. In addition, the Shareholder Services Plan provides
that material amendments 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 who have no direct or indirect financial interest in the operation of
the Shareholder Services Plan or in any agreements entered into in connection
with the Shareholder Services Plan, by vote cast in person at a meeting called
for the purpose of considering such amendments. The Shareholder Services 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 Shareholder Services Plan. As to
each Class of shares, the Shareholder Services Plan is terminable at any time by
vote of a majority of the Board members who are not "interested persons" and who
have no direct or indirect financial interest in the operation of the
Shareholder Services Plan or in any agreements entered into in connection with
the Shareholder Services Plan.
For the fiscal year ended January 31, 2000, the Fund paid $331,231, $44,314
and $2,995 with respect to Class A, Class B and Class C shares, respectively,
pursuant to the Shareholder Services Plan.
HOW TO REDEEM SHARES
Contingent Deferred Sales Charge--Class B Shares. A CDSC payable to the
Distributor is imposed on any redemption of Class B shares which reduces the
current net asset value of your Class B shares to an amount which is lower than
the dollar amount of all payments by you for the purchase of Class B shares of
the Fund held by you at the time of redemption. No CDSC will be imposed to the
extent that the net asset value of the Class B shares redeemed does not exceed
(i) the current net asset value of the Class B shares acquired through
reinvestment of dividends or capital gain distributions, plus (ii) increases in
the net asset value of your Class B shares above the dollar amount of all your
payments for the purchase of Class B shares held by you at the time of
redemption.
If the aggregate value of Class B shares redeemed has declined below their
original cost as a result of the Fund's performance, a CDSC may be applied to
the then-current net asset value rather than the purchase price.
In circumstances where the CDSC is imposed, the amount of the charge will
depend on the number of years for the time you purchased the Class B shares
until the time of redemption of such shares. Solely for purposes of determining
the number of years from the time of any payment for the purchase of Class B
shares, all payments during a month will be aggregated and deemed to have been
made on the first day of the month.
The following table sets forth the rates of the CDSC for Class B shares,
except for Class B shares purchased by shareholders who beneficially owned Class
B shares on November 30, 1996;
Year Since CDSC as a % of
Purchase Payment Amount Invested or
Was Made Redemption Proceeds
First............................ 4.00
Second........................... 4.00
Third............................ 3.00
Fourth........................... 3.00
Fifth............................ 2.00
Sixth............................ 1.00
The following table sets forth the rates of the CDSC for Class B shares
purchased by shareholders who beneficially owned Class B shares on November 30,
1996:
Year Since CDSC as a % of
Purchase Payment Amount Invested or
Was Made Redemption Proceeds
First............................ 3.00
Second........................... 3.00
Third............................ 2.00
Fourth........................... 2.00
Fifth............................ 1.00
Sixth............................ 0.00
In determining whether a CDSC is applicable to a redemption, the
calculation will be made in a manner that results in the lowest possible rate.
It will be assumed that the redemption is made first of amounts representing
shares acquired pursuant to the reinvestment of dividends and distributions;
then of amounts representing the increase in net asset value of Class B shares
above the total amount of payments for the purchase of Class B shares made
during the preceding six years (five years for shareholders beneficially owning
Class B shares on November 30, 1996); then of amounts representing the cost of
shares purchased six years (five years for shareholders beneficially owning
Class B shares on November 30, 1996) prior to the redemption; and finally, of
amounts representing the cost of shares held for the longest period of time
within the applicable six-year period (five-year period for shareholders
beneficially owning Class B shares on November 30, 1996).
For example, assume an investor purchased 100 shares at $10 per share for a
cost of $1,000. Subsequently, the shareholder acquired five additional shares
through dividend reinvestment. During the second year after the purchase the
investor decided to redeem $500 of the investment. Assuming at the time of the
redemption the net asset value had appreciated to $12 per share, the value of
the investor's shares would be $1,260 (105 shares at $12 per share). The CDSC
would not be applied to the value of the reinvested dividend shares and the
amount which represents appreciation ($260). Therefore, $240 of the $500
redemption proceeds ($500 minus $260) would be charged at a rate of 4% (the
applicable rate in the second year after purchase) for a total CDSC of $9.60.
Contingent Deferred Sales Charge--Class C Shares. A CDSC of 1% payable to
the Distributor is imposed on any redemption of Class C shares within one year
of the date of purchase. The basis for calculating the payment of any such CDSC
will be the method used in calculating the CDSC for Class B shares. See
"Contingent Deferred Sales Charge--Class B Shares" above.
Waiver of CDSC. The CDSC will be waived in connection with (a) redemptions
made within one year after the death or disability, as defined in Section
72(m)(7) of the Code, of the shareholder, (b) redemptions 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 exceeds $1,000,000, (c) redemptions as a result of a combination of
any investment company with the Fund by merger, acquisition of assets or
otherwise, (d) a distribution following retirement under a tax-deferred
retirement plan or upon attaining age 70 1/2 in the case of an IRA or Keogh plan
or custodial account pursuant to Section 403(b) of the Code, and (e) redemptions
pursuant to the Automatic Withdrawal Plan, as described below. If the Fund's
Board determines to discontinue the waiver of the CDSC, the disclosure herein
will be revised appropriately. Any Fund shares subject to a CDSC which were
purchased prior to the termination of such waiver will have the CDSC waived as
provided in the Fund's Prospectus or this Statement of Additional Information at
the time of the purchase of such shares.
To qualify for a waiver of the CDSC, at the time of redemption you must
notify the Transfer Agent or your Service Agent must notify the Distributor. Any
such qualification is subject to confirmation of your entitlement.
Checkwriting Privilege--Class A Only. The Fund provides Redemption Checks
("Checks") to investors in Class A shares automatically upon opening an account
unless you specifically refuse the Checkwriting Privilege by checking the
applicable "No" box on the Account Application. Checks will be sent only to the
registered owner(s) of the account and only to the address of record. The
Checkwriting Privilege may be established for an existing account by a separate
signed Shareholder Services Form. The Account Application or Shareholder
Services Form must be manually signed by the registered owner(s). Checks are
drawn on your Fund account and 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 your agent, will cause the Fund to redeem a
sufficient number of full and fractional Class A shares in your 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 you. You generally will be
subject to the same rules and regulations that apply to checking accounts,
although election of this Privilege creates only a shareholder-transfer agent
relationship with the Transfer Agent.
You should date your Checks with the current date when you write them.
Please do not postdate your Checks. If you do, the Transfer Agent will honor,
upon presentment, even if presented before the date of the Check, all postdated
Checks which are dated within six months of presentment for payment, if they are
otherwise in good order.
Checks are free, but the Transfer Agent will impose a fee for stopping
payment of a Check upon your request or if the Transfer Agent cannot honor a
Check due to insufficient funds or other valid reason. If the amount of the
Check is greater than the value of the Class A shares in your account, the Check
will be returned marked insufficient funds. Checks should not be used to close
an account.
This Privilege will be terminated immediately, without notice, with respect
to any account which is, or becomes, subject to back up withholding on
redemptions. Any Check written on an account which has become subject to backup
withholding on redemptions will not be honored by the Transfer Agent.
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 prior to the close of trading on the floor of the New York Stock
Exchange (currently 4:00 p.m., New York time), the redemption request will be
effective on that day. If a redemption request is received by the Transfer Agent
after the close of trading on the floor of the New York Stock Exchange, the
redemption request will be effective 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. See "How to Buy Shares" for a discussion of
additional conditions or fees that may be imposed upon redemption.
In addition, the Distributor or its designee will accept orders from
Selected Dealers with which the Distributor has sales agreements for the
repurchase of shares held by shareholders. Repurchase orders received by dealers
by the close of trading on the floor of the New York Stock Exchange on any
business day and transmitted to the Distributor or its designee prior to the
close of its business day (normally 5:15 p.m., New York time) are effected at
the price determined as of the close of trading on the floor of the New York
Stock Exchange on that day. Otherwise, the shares will be redeemed at the next
determined net asset value. It is the responsibility of the Selected Dealer to
transmit orders on a timely basis. The Selected Dealer may charge the
shareholder a fee for executing the order. This repurchase arrangement is
discretionary and may be withdrawn at any time.
Reinvestment Privilege. Upon written request, you may reinvest up to the
number of Class A or Class B shares you have redeemed, within 45 days of
redemption, at the then-prevailing net asset value without a sales load, or
reinstate your account for the purpose of exercising Fund Exchanges. Upon
reinstatement, with respect to Class B shares, or Class A shares if such shares
were subject to a CDSC, your account will be credited with an amount equal to
CDSC previously paid upon redemption of the Class A or Class B shares
reinvested. The Reinvestment Privilege may be exercised only once.
Dreyfus TeleTransfer Privilege. You may request by telephone that
redemption proceeds be transferred between your Fund account and your bank
account. Only a bank account maintained in a domestic financial institution
which is an ACH member may be designated. Holders of jointly registered Fund or
bank accounts may redeem through the Dreyfus TeleTransfer Privilege for transfer
to their bank account not more than $500,000 within any 30-day period.
Redemption proceeds will be on deposit in your account at an ACH member bank
ordinarily two business days after receipt of the redemption request. You should
be aware that if you have selected the Dreyfus TeleTransfer Privilege, any
request for a wire redemption will be effected as a Dreyfus TeleTransfer
transaction through the ACH system unless more prompt transmittal specifically
is requested. See "How to Buy Shares--Dreyfus TeleTransfer Privilege."
Share 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 owner 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.
Redemption Commitment. The 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, the Fund's Board reserves the
right to make payments in whole or in part in 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 sells such securities, brokerage charges might be
incurred.
Suspension of Redemptions. The right of redemption may be suspended or the
date of payment postponed (a) during any period when the New York Stock Exchange
is closed (other than customary weekend and holiday closings), (b) when trading
in the markets the Fund ordinarily utilizes is restricted, or when an emergency
exists as determined by the Securities and Exchange Commission so that disposal
of the Fund's investments or determination of its net asset value is not
reasonably practicable, or (c) for such other periods as the Securities and
Exchange Commission by order may permit to protect the Fund's shareholders.
SHAREHOLDER SERVICES
Fund Exchanges. Clients of certain Service Agents may purchase, in exchange
for shares of the Fund, shares of the same Class of another fund in the Dreyfus
Premier Family of Funds, shares of the same Class of certain funds advised by
Founders, or shares of certain other funds in the Dreyfus Family of Funds, to
the extent such shares are offered for sale in your state of residence. Shares
of the same Class of such other funds purchased by exchange will be purchased on
the basis of relative net asset value per share as follows: Class A shares of
funds purchased without a sales load may be exchanged for Class A shares of
other funds sold with a sales load, and the applicable sales load will be
deducted.
A. Exchanges for shares of funds 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 without a
sales load 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"), but 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.
E. Shares of funds subject to a CDSC that are exchanged for shares of
another fund will be subject to the higher applicable CDSC of the two
funds, and for purposes of calculating CDSC rates and conversion
periods, if any, will be deemed to have been held since the date the
shares being exchanged were initially purchased.
To accomplish an exchange under item D above, your Service Agent must
notify the Transfer Agent of your prior ownership of such Class A shares and
your account number.
You also may exchange your Fund shares that are subject to a CDSC for
shares of Dreyfus Worldwide Dollar Money Market Fund, Inc. The shares so
purchased will be held in a special account created solely for this purpose
("Exchange Account"). Exchanges of shares for an Exchange Account only can be
made into certain other funds manage or administered by the Manager. No CDSC is
charged when an investor exchanges into an Exchange Account; however, the
applicable CDSC will be imposed when shares are redeemed from an Exchange
Account or other applicable Fund account. Upon redemption, the applicable CDSC
will be calculated without regard to the time such shares were held in an
Exchange Account. See "How to Redeem Shares." Redemption proceeds for Exchange
Account shares are paid by Federal wire or check only. Exchange Account shares
also are eligible for the Dreyfus Auto-Exchange Privilege, Dreyfus Dividend
Sweep and the Automatic Withdrawal Plan.
To request an exchange, your Service Agent acting on your 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 shareholders
automatically, unless you check the applicable "No" box on the Account
Application, indicating that you specifically refuse this privilege. By using
the Telephone Exchange Privilege, you authorize the Transfer Agent to act on
telephonic instructions (including over The Dreyfus Touch(R) 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. 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 exchange. No fees currently are
charged shareholders directly in connection with exchanges, although the 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.
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
being required for shares of the same Class of the fund into which the exchange
is being made.
Dreyfus Auto-Exchange Privilege. Dreyfus Auto-Exchange Privilege permits
you to purchase (on a semi-monthly, monthly, quarterly or annual basis), in
exchange for shares of the Fund, shares of the same Class of another fund in the
Dreyfus Premier Family of Funds, shares of the same Class of certain funds
advised by Founders or shares of certain other funds in the Dreyfus Family of
Funds, of which you are a shareholder. 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 you. You will be notified if your account falls below the amount
designated to be exchanged under this Privilege. In this case, your account will
fall to zero unless additional investments are made in excess of the designated
amount prior to the next Auto-Exchange transaction.
Shareholder Services Forms and prospectuses of the other funds may be
obtained by calling 1-800-645-6561. The Fund reserves the right to reject any
exchange request in whole or in part. Shares may be exchanged only between
accounts having identical names and other identifying designations. The Fund
Exchanges service or the Dreyfus Auto-Exchange Privilege may be modified or
terminated at any time upon notice to shareholders.
Dreyfus-Automatic Asset Builder(R). 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.
Dreyfus Government Direct Deposit Privilege. Dreyfus 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 U.S. Government
automatically deposited into your Fund account. You may deposit as much of such
payments as you elect.
Dreyfus Dividend Options. Dreyfus Dividend Sweep allows you to invest
automatically your dividends or dividends and capital gain distributions, if
any, from the Fund in shares of the same Class of another fund in the Dreyfus
Premier Family of Funds, shares of the same Class of certain funds advised by
Founders, or shares of certain other funds in the Dreyfus Family of Funds of
which you are a shareholder. Shares of the same Class 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 with respect to Class A shares by a
fund may be invested without imposition of a sales load in Class A
shares of other funds offered without a sales load.
B. Dividends and distributions paid with respect to Class A shares by a
fund which does not charge a sales load may be invested in Class A
shares of other funds sold with a sales load, and the applicable sales
load will be deducted.
C. Dividends and distributions paid with respect to Class A shares by a
fund which charges a sales load may be invested in Class A shares of
other funds sold with a sales load (referred to herein as "Offered
Shares"), but 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 with respect to Class B or
Class C shares may be invested without imposition of any applicable
CDSC in the same Class of shares of other funds and the relevant Class
of shares of such other funds will be subject on redemption to any
applicable CDSC.
Dreyfus Dividend ACH permits you to transfer electronically dividends or
dividends and capital gain distributions, if any, from the Fund to a designated
bank account. Only an account maintained at a domestic financial institution
which is an ACH member may be so designated. Banks may charge a fee for this
service.
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. Withdrawal
payments are the proceeds from sales of Fund shares, not the yield on the
shares. If withdrawal payments exceed reinvested dividends and distributions,
your shares will be reduced and eventually may be depleted. Automatic Withdrawal
may be terminated at any time by you, the Fund or the Transfer Agent. Shares for
which stock certificates have been issued may not be redeemed through the
Automatic Withdrawal Plan.
No CDSC with respect to Class B shares will be imposed on withdrawals made
under the Automatic Withdrawal Plan, provided that the amounts withdrawn under
the plan do not exceed on an annual basis 12% of the account value at the time
the shareholder elects to participate in the Automatic Withdrawal Plan.
Withdrawals with respect to Class B shares under the Automatic Withdrawal Plan
that exceed on an annual basis 12% of the value of the shareholders account will
be subject to a CDSC on the amounts exceeding 12% of the initial account value.
Withdrawals of Class A shares subject to a CDSC and Class C shares under the
Automatic Withdrawal Plan will be subject to any applicable CDSC. Purchases of
additional Class A shares where the sales load is imposed concurrently with
withdrawals of Class A shares generally are undesirable.
Letter of Intent--Class A Shares. By signing a Letter of Intent form, which
can be obtained by calling 1-800-554-4611, you become eligible for the reduced
sales load applicable to the total number of Eligible Fund shares purchased in a
13-month period pursuant to the terms and conditions set forth in the Letter of
Intent. A minimum initial purchase of $5,000 is required. To compute the
applicable sales load, the offering price of shares you hold (on the date of
submission of the Letter of Intent) in any Eligible Fund that may be used toward
"Right of Accumulation" benefits described above may be used as a credit toward
completion of the Letter of Intent. However, the reduced sales load will be
applied only to new purchases.
The Transfer Agent will hold in escrow 5% of the amount indicated in the
Letter of Intent for payment of a higher sales load if you do not purchase the
full amount indicated in the Letter of Intent. The escrow will be released when
you fulfill the terms of the Letter of Intent by purchasing the specified
amount. If your purchases qualify for a further sales load reduction, the sales
load will be adjusted to reflect your total purchase at the end of 13 months. If
total purchases are less than the amount specified, you will be requested to
remit an amount equal to the difference between the sales load actually paid and
the sales load applicable to the aggregate purchases actually made. If such
remittance is not received within 20 days, the Transfer Agent, as
attorney-in-fact pursuant to the terms of the Letter of Intent, will redeem an
appropriate number of Class A shares of the Fund held in escrow to realize the
difference. Signing a Letter of Intent does not bind you to purchase, or the
Fund to sell, the full amount indicated at the sales load in effect at the time
of signing, but you must complete the intended purchase to obtain the reduced
sales load. At the time you purchase Class A shares, you must indicate your
intention to do so under a Letter of Intent. Purchase pursuant to a Letter of
Intent will be made at the then-current net asset value plus the applicable
sales load in effect at the time such Letter of Intent was executed.
DETERMINATION OF NET ASSET VALUE
Valuation of Portfolio Securities. The Fund's investments are valued each
business day by an independent pricing service (the "Service") approved by the
Fund's Board. When, in the judgment of the Service, quoted bid prices for
investments are readily available and are representative of the bid side of the
market, these investments are valued at the mean between the quoted bid prices
(as obtained by the Service from dealers in such securities) and asked prices
(as calculated by the Service based upon its evaluation of the market for such
securities). Other investments (which constitute a majority of the portfolio
securities) are carried at fair value as determined by the Service, based on
methods which include consideration of: yields or prices of municipal bonds of
comparable quality, coupon, maturity and type; indications as to values from
dealers; and general market conditions. The Service may employ electronic data
processing techniques and/or a matrix system to determine valuations. The
Service's procedures are reviewed by the Fund's officers under the general
supervision of the Fund's Board. Expenses and fees, including the management fee
(reduced by the expense limitation, if any) and fees pursuant to the Shareholder
Services Plan, with respect to Class A, Class B and Class C shares, and fees
pursuant to the Distribution Plan, with respect to Class B and Class C shares
only, are accrued daily and are taken into account for the purpose of
determining the net asset value of the relevant Class of shares. Because of the
difference in operating expenses incurred by each Class, the per share net asset
value of each Class will differ.
New York Stock Exchange Closings. The holidays (as observed) on which the
New York Stock Exchange is closed currently are: New Year's Day, Martin Luther
King Jr. Day, Presidents' Day, Good Friday, Memorial Day, Independence Day,
Labor Day, Thanksgiving and Christmas.
DIVIDENDS, DISTRIBUTIONS AND TAXES
Management believes that the Fund qualified as a "regulated investment
company" under the Code for the fiscal year ended January 31, 2000, and the Fund
intends to continue to so qualify so long as such qualification is in the best
interests of its shareholders. As a regulated investment company, the Fund will
pay no Federal income tax on net investment income and net realized capital
gains to the extent that such income and gains are distributed to shareholders
in accordance with applicable provisions of the Code. To qualify as a regulated
investment company, the Fund must pay out to its shareholders at least 90% of
its net income (consisting of net investment income from tax exempt obligations
and taxable obligations, if any, and net short-term capital gains), and must
meet certain asset diversification and other requirements. If the Fund did not
qualify as a regulated investment company, it would be treated for tax purposes
as an ordinary corporation subject to Federal income tax. The term "regulated
investment company" does not imply the supervision of management or investment
practices or policies by any government agency.
The Fund ordinarily declares dividends from its net investment income on
each day the New York Stock Exchange is open for business. Fund shares begin
earning income dividends on the day immediately available funds ("Federal
Funds") are received by the Transfer Agent. If a purchase order is not
accompanied by remittance in Federal Funds, there may be a delay between the
time the purchase order becomes effective and the time the shares purchased
start earning dividends. If your payment is not made in Federal Funds, it 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.
Dividends usually are paid on the last calendar day of each month and are
automatically reinvested in additional shares of the same Class from which they
were paid at net asset value without a sales load or, at your option, paid in
cash. The Fund's earnings for Saturdays, Sundays and holidays are declared as
dividends on the preceding business day. 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.
If you elect to receive dividends and distributions in cash, and your
dividend or distribution check is returned to the Fund as undeliverable or
remains uncashed for six months, the Fund reserves the right to reinvest such
dividend or distribution and all future dividends and distributions payable to
you in additional Fund shares at net asset value. No interest will accrue on
amounts represented by uncashed distribution or redemption checks.
If, at the close of each quarter of its taxable year, at least 50% of the
value of the Fund's total assets consists of Federal tax exempt obligations,
then the Fund may designate and pay Federal exempt-interest dividends from
interest earned on all such tax exempt obligations. Such exempt-interest
dividends may be excluded by shareholders of the Fund from their gross income
for Federal income tax purposes.
If, at the close of each quarter of its taxable year, at least 50% of the
value of the Fund's total assets consists of obligations which, when held by an
individual, the interest therefrom is exempt from California personal income
tax, and if the Fund qualifies as a management company under the California
Revenue and Taxation Code, then the Fund will be qualified to pay dividends to
its shareholders that are exempt from California personal income tax (but not
from California franchise tax) ("California exempt-interest dividends").
However, the total amount of California exempt-interest dividends paid by the
Fund to a non-corporate shareholder with respect to any taxable year cannot
exceed such shareholder's pro-rata share of interest received by the Fund during
such year that is exempt from California taxation less any expenses and
expenditures deemed to have been paid from such interest.
For shareholders subject to the California personal income tax,
exempt-interest dividends derived from California Municipal Obligations will not
be subject to the California personal income tax. Distributions from net
realized short-term capital gains to California resident shareholders will be
subject to the California personal income tax as ordinary income. Distributions
from net realized long-term capital gains may constitute long-term capital gains
for individual California resident shareholders. Unlike under Federal tax law,
the Fund's shareholders will not be subject to California personal income tax,
or receive a credit for California taxes paid by the Fund, on undistributed
capital gains. In addition, California tax law does not consider any portion of
the exempt-interest dividends paid an item of tax preference for the purposes of
computing the California alternative minimum tax.
Any dividend or distribution paid shortly after an investor's purchase may
have the effect of reducing the aggregate net asset value of his shares below
the cost of his investment. Such a distribution would be a return on investment
in an economic sense although taxable as stated in the Prospectus. In addition,
the Code provides that if a shareholder has not held his Fund shares for more
than six months (or such shorter period as the Internal Revenue Service may
prescribe by regulation) and has received an exempt-interest dividend with
respect to such shares, any loss incurred on the sale of such shares will be
disallowed to the extent of the exempt-interest dividend received.
Ordinarily, gains and losses realized from portfolio transactions will be
treated as capital gains and losses. However, all or a portion of the gains
realized from the disposition of certain market discount bonds will be treated
as ordinary income. In addition, all or a portion of the gain realized from
engaging in "conversion transactions" (generally including certain transactions
designed to convert ordinary income into capital gain) may be treated as
ordinary income.
Gain or loss, if any, realized by the Fund from certain financial futures
and options transactions ("Section 1256 contracts") will be treated as 60%
long-term capital gain or loss and 40% short-term capital gain or loss. Gain or
loss will arise upon exercise or lapse of Section 1256 contracts as well as from
closing transactions. In addition, any Section 1256 contracts remaining
unexercised at the end of the Fund's taxable year will be treated as sold for
their then fair market value, resulting in additional gain or loss to the Fund
as described above.
Offsetting positions held by the Fund involving certain futures and options
transactions with respect to actively traded personal property may be
considered, for tax purposes, to constitute "straddles." To the extent the
straddle rules apply to positions established by the Fund, losses realized by
the Fund may be deferred to the extent of unrealized gain in the offsetting
position. In addition, short-term capital loss on straddle positions may be
recharacterized as long-term capital loss, and long-term capital gains on
straddle positions may be treated as short-term capital gains or ordinary
income. Certain of the straddle positions held by the Fund may constitute "mixed
straddles." The Fund may make one or more elections with respect to the
treatment of "mixed straddles," resulting in different tax consequences. In
certain circumstances, the provisions governing the tax treatment of straddles
override or modify certain of the provisions discussed above.
If the Fund either (1) holds an appreciated financial position with respect
to stock, certain debt obligations, or partnership interests ("appreciated
financial position") and then enters into a short sale, futures, forward, or
offsetting notional principal contract (collectively, a "Contract") respecting
the same or substantially identical property or (2) holds an appreciated
financial position that is a Contract and then acquires property that is the
same as, or substantially identical to, the underlying property, the Fund
generally will be taxed as if the appreciated financial position were sold at
its fair market value on the date the Fund enters into the financial position or
acquires the property, respectively.
Investment by the Fund in securities issued or acquired at a discount, or
providing for deferred interest or for payment of interest in the form of
additional obligations, could, under special tax rules, affect the amount,
timing and character of distributions to shareholders by causing the Fund to
recognize income prior to the receipt of cash payment. For example, the Fund
could be required to take into account annually a portion of the discount (or
deemed discount) at which such securities were issued and to distribute such
portion in order to maintain its qualification as a regulated investment
company. In such case, the Fund may have to dispose of securities which it might
otherwise have continued to hold in order to generate cash to satisfy these
distribution requirements.
PORTFOLIO TRANSACTIONS
Portfolio securities ordinarily are purchased from and sold to parties
acting as either principal or agent. Newly-issued securities ordinarily are
purchased directly from the issuer or from an underwriter; other purchases and
sales usually are placed with those dealers from which it appears that the best
price or execution will be obtained. Usually no brokerage commissions, as such,
are paid by the Fund for such purchases and sales, although the price paid
usually includes an undisclosed compensation to the dealer acting as agent. The
prices paid to underwriters of newly-issued securities usually include a
concession paid by the issuer to the underwriter, and purchases of after-market
securities from dealers ordinarily are executed at a price between the bid and
asked price. No brokerage commissions have been paid by the Fund to date.
Transactions are allocated to various dealers by the Fund's portfolio
managers in their best judgment. The primary consideration is prompt and
effective execution of orders at the most favorable price. Subject to that
primary consideration, dealers may be selected for research, statistical or
other services to enable the Manager 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 shares of the Fund or other funds advised by the
Manager or its affiliates.
Research services furnished by brokers through which the 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 Manager's opinion that the receipt and study of such
services should not reduce the overall expenses of its research department.
The aggregate amount of transactions during the last fiscal year in newly
issued debt instruments in fixed price public offerings directed to an
underwriter in consideration of, among other things, research services provided
was $0.
PERFORMANCE INFORMATION
Current yield for the 30-day period ended January 31, 2000 for Class A was
4.75%, for Class B was 4.44% and for Class C was 4.25%. Current yield is
computed pursuant to a formula which operates as follows: The amount of the
Fund's expenses accrued for the 30-day period (net of reimbursements) is
subtracted from the amount of the dividends and interest earned (computed in
accordance with regulatory requirements) by the Fund during the period. That
result is then divided by the product of: (a) the average daily number of shares
outstanding during the period that were entitled to receive dividends, and (b)
the maximum offering price per share in the case of Class A or the net asset
value per share in the case of Class B or Class C on the last day of the period
less any undistributed earned income per share reasonably expected to be
declared as a dividend shortly thereafter. The quotient is then added to 1, and
that sum is raised to the 6th power, after which 1 is subtracted. The current
yield is then arrived at by multiplying the result by 2.
Based upon a combined 1999 Federal and State of California personal income
tax rate of 45.22%, the tax equivalent yield for the 30-day period ended January
31, 2000 for Class A was 8.67%, for Class B was 8.11% and for Class C was 7.76%.
Tax equivalent yield is computed by dividing that portion of the current yield
(calculated as described above) which is tax exempt by 1 minus a stated tax rate
and adding the quotient to that portion, if any, of the yield of the Fund that
is not tax exempt.
The tax equivalent yield noted above represents the application of the
highest Federal and State of California marginal personal income tax rates
presently in effect. For Federal personal income tax purposes, a 39.60% rate has
been used. For California personal income tax purposes, a 9.30% tax rate has
been used. The tax equivalent yield figure, however, does not reflect the
potential effect of any local (including, but not limited to, county, district
or city) taxes, including applicable surcharges. In addition, there may be
pending legislation which could affect such stated tax rates or yields. Each
investor should consult its tax adviser, and consider its own factual
circumstances and applicable tax laws, in order to ascertain the relevant tax
equivalent yield.
The average annual total return for the 1, 5 and 10 year periods ended
January 31, 2000 for Class A was -12.53%, 3.49% and 5.49%, respectively. The
average annual total return for the 1, 5 and 7.05 year periods ended January 31,
2000 for Class B was -12.37%, 3.61% and 4.08%, respectively. The average annual
total return for the 1 and 4.67 year periods ended January 31, 2000 for Class C
was -2.94% and 2.36%, respectively. Average annual total return is calculated by
determining the ending redeemable value of an investment purchased at net asset
value (maximum offering price in the case of Class A) per share with a
hypothetical $1,000 payment made at the beginning of the period (assuming the
reinvestment of dividends and distributions), dividing by the amount of the
initial investment, taking the "n"th root of the quotient (where "n" is the
number of years in the period) and subtracting 1 from the result. A Class's
average total return figures calculated in accordance with such formula assume
that in the case of Class A the maximum sales load had been deducted from the
hypothetical initial investment at the time of purchase or in the case of Class
B or Class C the maximum applicable CDSC has been paid upon redemption at the
end of the period.
The total return for Class A for the period November 10, 1986 (commencement
of operations) through January 31, 2000 was 108.13%. Based on net asset value
per share, the total return for Class A was 117.96% for this period. The total
return for Class B for the period January 15, 1993 (commencement of initial
offering of Class B shares) through January 31, 2000 was 32.57%. The total
return for Class C for the period June 2, 1995 (commencement of initial offering
of Class C shares) through January 31, 2000 was 11.50%. Total return is
calculated by subtracting the amount of the Fund's net asset value (maximum
offering price in the case of Class A) per share at the beginning of a stated
period from the net asset value per share at the end of the period (after giving
effect to the reinvestment of dividends and distributions during the period and
any applicable CDSC), and dividing the result by the net asset value (maximum
offering price in the case of Class A) per share at the beginning of the period.
Total return also may be calculated based on the net asset value per share at
the beginning of the period instead of the maximum offering price per share at
the beginning of the period for Class A shares or without giving effect to any
applicable CDSC at the end of the period for Class B or Class C shares. In such
cases, the calculation would not reflect the deduction of the sales load with
respect to Class A shares or any applicable CDSC with respect to Class B or
Class C shares, which, if reflected, would reduce the performance quoted. The
total return for Class B shares takes into consideration a conversion to Class A
shares after six years. Since the periods covered for Class B and Class C are
beyond the period for which a CDSC would be applied, no CDSC is factored into
the aggregate total return quoted above for class B and Class C.
From time to time, the Fund may use hypothetical tax equivalent yields or
charts in its advertising. These hypothetical yields or charts will be used for
illustrative purposes only and not as being representative of the Fund's past or
future performance.
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 Monitor(TM), N. Palm Beach, FL 33408, IBC's Money Fund
Report(TM), Morningstar, Inc. and other industry publications. Advertising
materials for the Fund also may refer to or discuss then-current or past
economic conditions, developments and/or events, including those relating to or
arising from actual or proposed tax legislation. From time to time, advertising
materials for the Fund also may refer to statistical or other information
concerning trends relating to investment companies, as compiled by industry
associations such as the Investment Company Institute, and/or to studies
performed by the Manager or its affiliates, such as "The Dreyfus Tax Informed
Investing Study" or "The Dreyfus Gender Investment Comparison Study" or such
other studies.
INFORMATION ABOUT THE FUND
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. Shares have no
preemptive or subscription rights and are freely transferable.
Unless otherwise required by the 1940 Act, ordinarily it will not be
necessary for the Fund to hold annual meetings of shareholders. As a result,
Fund shareholders may not consider each year the election of Board members or
the appointment of auditors. However, the holders of at least 10% of the shares
outstanding and entitled to vote may require the Fund to hold a special meeting
of shareholders for purposes of removing a Board member from office. Fund
shareholders may remove a Board member by the affirmative vote of two-thirds of
the Fund's outstanding voting shares. In addition, the Board will call a meeting
of shareholders for the purpose of electing Board members if, at any time, less
than a majority of the Board members then holding office have been elected by
shareholders.
The Fund is organized as an unincorporated business trust under the laws of
the Commonwealth of Massachusetts. Under Massachusetts law, shareholders could,
under certain circumstances, be held personally liable for the obligations of
the Fund. However, the Fund's Agreement and Declaration of Trust ("Trust
Agreement") disclaims shareholder liability for acts or obligations of the Fund
and requires that notice of such disclaimer be given in each agreement,
obligation or instrument entered into or executed by the Fund or a Board member.
The Trust Agreement provides for indemnification from the Fund's property for
all losses and expenses of any shareholder held personally liable for the
obligations of the Fund. Thus, the risk of a shareholder incurring financial
loss on account of a shareholder liability is limited to circumstances in which
the Fund itself would be unable to meet its obligations, a possibility which
management believes is remote. Upon payment of any liability incurred by the
Fund, the shareholder paying such liability will be entitled to reimbursement
from the general assets of the Fund. The Fund intends to conduct its operations
in a way so as to avoid, as far as possible, ultimate liability of the
shareholders for liabilities of the Fund.
The Fund is intended to be a long-term investment vehicle and is not
designed to provide investors with a means of speculating on short-term market
movements. A pattern of frequent purchases and exchanges can be disruptive to
efficient portfolio management and, consequently, can be detrimental to the
Fund's performance and its shareholders. Accordingly, if the Fund's management
determines that an investor is following a market-timing strategy or is
otherwise engaging in excessive trading, the Fund, with or without prior notice,
may temporarily or permanently terminate the availability of Fund Exchanges, or
reject in whole or part any purchase or exchange request, with respect to such
investor's account. Such investors also may be barred from purchasing other
funds in the Dreyfus Family of Funds. Generally, an investor who makes more than
four exchanges out of the Fund during any calendar year or who makes exchanges
that appear to coincide with a market-timing strategy may be deemed to be
engaged in excessive trading. Accounts under common ownership or control will be
consider as one account for purposes of determining a patter of excessive
trading. In addition, the Fund may refuse or restrict purchase or exchange
requests by any person or group if, in the judgment of the Fund's management,
the Fund would be unable to invest the money effectively in accordance with its
investment objective and policies or could otherwise be adversely affected or if
the Fund receives or anticipates receiving simultaneous orders that may
significantly affect the Fund (e.g., amounts equal to 1% or more of the Fund's
total assets). If an exchange request is refused, the Fund will take no other
action with respect to the shares until it receives further instructions from
the investor. The Fund may delay forwarding redemption proceeds for up to seven
days if the investor redeeming shares is engaged in excessive trading or if the
amount of the redemption request otherwise would be disruptive to efficient
portfolio management or would adversely affect the Fund. The Fund's policy on
excessive trading applies to investors who invest in the Fund directly or
through financial intermediaries, but does not apply to the Dreyfus
Auto-Exchange Privilege, to any automatic investment or withdrawal privilege
described herein, or to participants in employer-sponsored retirement plans.
During times of drastic economic or market conditions, the Fund may suspend
Fund Exchanges temporarily without notice and treat exchange requests based on
their separate components - redemption orders with a simultaneous request to
purchase the other fund's shares. In such a case, the redemption request would
be processed at the Fund's next determined net asset value but the purchase
order would be effective only at the net asset value next determined after the
fund being purchased receives proceeds of the redemption, which may result in
the purchase being delayed.
To offset the relatively higher costs of servicing smaller accounts, the
Fund will charge regular accounts with balances below $2,000 an annual fee of
$12. The valuation of accounts and the deductions are expected to take place
during the last four months of each year. The fee will be waived for any
investor whose aggregate Dreyfus mutual fund investments total at least $25,000,
and will not apply to accounts participating in automatic investment programs or
opened through a securities dealer, bank or other financial institution, or to
other fiduciary accounts.
The Fund will send annual and semi-annual financial statements to all its
shareholders.
The Manager's legislative efforts led to the 1976 Congressional Amendment
to the Code permitting an incorporated mutual fund to pass through tax exempt
income to its shareholders. The Manager offered to the public the first
incorporated tax exempt fund and currently manages or administers over $22
billion in tax exempt assets.
COUNSEL AND INDEPENDENT AUDITORS
Stroock & Stroock & Lavan LLP, 180 Maiden Lane, New York, New York
10038-4982, as counsel for the Fund, has rendered its opinion as to certain
legal matters regarding the due authorization and valid issuance of the shares
being sold pursuant to the Fund's Prospectus.
Ernst & Young LLP, 787 Seventh Avenue, New York, New York 10019,
independent auditors, have been selected as independent auditors of the Fund.
YEAR 2000 ISSUES
The Fund could be adversely affected if the computer systems used by the
Manager and the Fund's other service providers do not properly process and
calculate date-related information from and after January 1, 2000. The Manager
has taken steps designed to avoid year 2000-related problems in its systems and
to monitor the readiness of other service providers. In addition, issuers of
securities in which the Fund invests may be adversely affected by year
2000-related problems. This could have an impact on the value of the Fund's
investments and its share price.
<PAGE>
APPENDIX A
INVESTING IN CALIFORNIA MUNICIPAL OBLIGATIONS
RISK FACTORS - INVESTING IN CALIFORNIA MUNICIPAL OBLIGATIONS
The following information is a summary of special factors affecting
investments in California Municipal Obligations. It does not purport to be a
complete description and is based on information drawn from the Official
Statement issued by the State of California (the "State") for its public bond
issue on December 1, 1999. While the Fund has not independently verified this
information, it has no reason to believe that such information is not correct in
all material respects.
STATE FINANCES
THE BUDGET PROCESS
The State's fiscal year begins on July 1 and ends on June 30. The State
operates on a budget basis, using a modified accrual system of accounting, with
revenues credited in the period in which they are measurable and available and
expenditures debited in the period in which the corresponding liabilities are
incurred.
The annual budget is proposed by the Governor by January 10 of each year
for the next fiscal year (the "Governor's Budget"). Under State law, the annual
proposed Governor's Budget cannot provide for projected expenditures in excess
of projected revenues and balances available from prior fiscal years. Following
the submission of the Governor's Budget, the Legislature takes up the proposal.
Under the State Constitution, money may be drawn from the Treasury only
through an appropriation made by law. The primary source of the annual
expenditure authorizations is the Budget Act as approved by the Legislature and
signed by the Governor. The Budget Act must be approved by a two-thirds majority
vote of each House of the Legislature. The Governor may reduce or eliminate
specific line items in the Budget Act or any other appropriations bill without
vetoing the entire bill. Such individual line-item vetoes are subject to
override by a two-thirds majority vote of each House of the Legislature.
Appropriations also may be included in legislation other than the Budget
Act. Bills containing appropriations (except for K-12 and community college
("K-14") education) must be approved by a two-thirds majority vote in each House
of the Legislature and be signed by the Governor. Bills containing K-14
education appropriations require a simple majority vote. Continuing
appropriations, available without regard to fiscal year, also may be provided by
statute or the State Constitution. There is litigation pending concerning the
validity of such continuing appropriations. See "Litigation" below.
Funds necessary to meet an appropriation need not be in the State
Treasury at the time such appropriation is enacted; revenues may be appropriated
in anticipation of their receipt.
THE GENERAL FUND
The moneys of the State are segregated into the General Fund and over 900
special funds, including bond, trust and pension funds. The General Fund
consists of revenues received by the State Treasury and not required by law to
be credited to any other fund, as well as earnings from the investment of State
moneys not allocable to another fund. The General Fund is the principal
operating fund for the majority of governmental activities and is the depository
of most of the major revenue sources of the State. The General Fund may be
expended as a consequence of appropriation measures enacted by the Legislature
and approved by the Governor, as well as appropriations pursuant to various
constitutional authorizations and initiative statutes.
THE SPECIAL FUND FOR ECONOMIC UNCERTAINTIES
The Special Fund for Economic Uncertainties ("SFEU") is funded with
General Fund revenues and was established to protect the State from unforeseen
revenue reductions and/or unanticipated expenditure increases. Amounts in the
SFEU may be transferred by the State Controller as necessary to meet cash needs
of the General Fund. The State Controller is required to return moneys so
transferred without payment of interest as soon as there are sufficient moneys
in the General Fund. At the time of signing of the 1999 Budget Act, on June 29,
1999, the Department of Finance projected the SFEU would have a balance of about
$1.932 billion at June 30, 1999, compared to the original budgeted amount of
$1.1 billion. The 1999 Budget Act projects a balance in the SFEU of $880 million
at June 30, 2000. See "Current State Budget" below.
INTER-FUND BORROWINGS
Inter-fund borrowing has been used for many years to meet temporary
imbalances of receipts and disbursements in the General Fund. As of June 30,
1999, the General Fund had no outstanding loans from the SFEU, General Fund
special accounts or other special funds. At the November 1998 election, voters
approved Proposition 2. This proposition requires the General Fund to repay
loans made from certain transportation special accounts (such as the State
Highway Account) at least once per fiscal year, or up to 30 days after adoption
of the annual budget act. Since the General Fund may reborrow from the
transportation accounts soon after the annual repayment is made, the proposition
is not expected to have any adverse impact on the State's cash flow.
WELFARE REFORM
Congress passed and the President signed (on August 22, 1996) the
Personal Responsibility and Work Opportunity Reconciliation Act of 1996 (P.L.
104-193, the "Welfare Reform Law") fundamentally reforming the nation's welfare
system. Among its many provisions, the Welfare Reform Law includes: (1)
conversion of Aid to Families with Dependent Children from an entitlement
program to a block grant titled Temporary Assistance for Needy Families (TANF),
with time limits on TANF recipients, work requirements and other changes; (ii)
provisions denying certain federal welfare and public benefits to legal
noncitizens (this provision has been amended by subsequent federal law),
allowing states to elect to deny additional benefits (including TANF) to legal
noncitizens, and generally denying almost all benefits to illegal immigrants;
and (iii) changes in the Food Stamp program, including reducing maximum benefits
and imposing work requirements.
California's response to the federal welfare reforms is embodied in
Chapter 270, Statutes of 1997 and is called California Work Opportunity and
Responsibility to Kids ("CalWORKs"), which replaced the former Aid to Families
with Dependent Children (AFDC) and Greater Avenues to Independence (GAIN)
programs, effective January 1, 1998. Consistent with the Welfare Reform Law,
CalWORKs contains new time limits on receipt of welfare aid, both lifetime as
well as for any current period on aid. The centerpiece of CalWORKs is the
linkage of eligibility to work participation requirements. Administration of the
new CalWORKs program is largely at the county level, and counties are given
financial incentives for success in this program.
The long-term impact of the Welfare Reform Law and CalWORKs cannot be
determined until there has been more experience and until an independent
evaluation of the CalWORKs program is completed. In the short-term, the
implementation of the CalWORKs program has continued the trend of declining
welfare caseloads. The CalWORKs caseload trend is projected to have been 646,000
in 1998-99 and to be 602,000 in 1999-00, down from a high of 921,000 cases in
1994-95.
The 1999 Budget Act proposes expenditures which will continue to meet,
but not exceed, the federally-required $2.9 billion combined State and county
maintenance-of-effort requirement. Total CalWORKs-related expenditures are
estimated to be $7.3 billion for 1998-99 and $7.3 billion for 1999-00, including
child care transfer amounts for the Department of Education.
LOCAL GOVERNMENTS
The primary units of local government in California are the counties,
ranging in population from 1,200 in Alpine County to over 9,600,000 in Los
Angeles County. Counties are responsible for the provision of many basic
services, including indigent health care, welfare, jails and public safety in
unincorporated areas. There also are about 470 incorporated cities and thousands
of special districts formed for education, utility and other services. The
fiscal condition of local governments has been constrained since the enactment
of "Proposition 13" in 1978, which reduced and limited the future growth of
property taxes and limited the ability of local governments to impose "special
taxes" (those devoted to a specific purpose) without two-thirds voter approval.
Counties, in particular, have had fewer options to raise revenues than many
other local government entities, and have been required to maintain many
services.
In the aftermath of Proposition 13, the State provided aid to local
governments from the General Fund to make up some of the loss of property tax
moneys, including taking over the principal responsibility for funding K-12
schools and community colleges. During the recession, the Legislature eliminated
most of the remaining components of post-Proposition 13 aid to local government
entities other than K-14 education districts by requiring cities and counties to
transfer some of their property tax revenues to school districts. However, the
Legislature also provided additional funding sources (such as sales taxes) and
reduced certain mandates for local services. Since then, the State also has
provided additional funding to counties and cities through such programs as
health and welfare realignment, welfare reform, trial court restructuring, the
COPs program supporting local public safety departments, and various other
measures.
The 1999 Budget Act includes a $150 million one-time subvention from the
General Fund to local agencies for relief from the 1992 and 1993 property tax
shifts. Legislation has been passed, subject to voter approval at the election
in November 2000, to provide a more permanent payment to local governments to
offset the property tax shift. In addition, legislation was enacted in 1999 to
provide annually up to $50 million relief to cities based on 1997-98 costs of
jail booking and processing fees paid to counties.
Historically, funding for the State's trial court system was divided
between the State and the counties. However, Chapter 850, Statutes of 1997,
implemented a restructuring of the State's trial court funding system. Funding
for the courts, with the exception of costs for facilities, local judicial
benefits, and revenue collection, was consolidated at the State level. The
county contribution for both their general fund and fine and penalty amounts is
capped at the 1994-95 level and becomes part of the Trial Court Trust Fund,
which supports all trial court operations. The State assumed responsibility for
future growth in trial court funding. The consolidation of funding is intended
to streamline the operation of the courts, provide a dedicated revenue source,
and relieve fiscal pressure on the counties. Beginning in 1998-99, the county
general fund contribution for court operations is reduced by $300 million, and
cities will retain $62 million in fine and penalty revenue previously remitted
to the State. The General Fund reimbursed the $362 million revenue loss to the
Trial Court Trust Fund. The 1999 Budget Act includes funds to further reduce the
county General Fund contribution by an additional $96 million by reducing by 100
percent the contributions of the next 18 smallest counties and by 10 percent the
General Fund contribution of the remaining 21 counties.
The entire statewide welfare system has been changed in response to the
change in federal welfare law enacted in 1996 (see "Welfare Reform" above).
Under the CalWORKs program, counties are given flexibility to develop their own
plans, consistent with State law, to implement the program and to administer
many of its elements, and their costs for administrative and supportive services
are capped at the 1996-97 levels. Counties also are given financial incentives
if, at the individual county level or statewide, the CalWORKs program produces
savings associated with specified standards. Counties will still be required to
provide "general assistance" aid to certain persons who cannot obtain welfare
from other programs.
In 1996, voters approved Proposition 218, entitled the "Right to Vote on
Taxes Act," which incorporates new Articles XIII C and XIII D into the
California Constitution. These new provisions place limitations on the ability
of local government agencies to impose or raise various taxes, fees, charges and
assessments without voter approval. Certain "general taxes" imposed after
January 1, 1995 must be approved by voters in order to remain in effect. In
addition, Article XIII C clarifies the right of local voters to reduce taxes,
fees, assessments or charges through local initiatives. Proposition 218 does not
affect the State or its ability to levy or collect taxes.
STATE APPROPRIATIONS LIMIT
The State is subject to an annual appropriations limit imposed by Article
XIII B of the State Constitution (the "Appropriations Limit"). The
Appropriations Limit does not restrict appropriations to pay debt service on
voter-authorized bonds.
Article XIII B prohibits the State from spending "appropriations subject
to limitation" in excess of the Appropriations Limit. "Appropriations subject to
limitation," with respect to the State, are authorizations to spend "proceeds of
taxes," which consist of tax revenues, and certain other funds, including
proceeds from regulatory licenses, user charges or other fees to the extent that
such proceeds exceed "the cost reasonably borne by that entity in providing the
regulation, product or service," but "proceeds of taxes" exclude most state
subventions to local governments, tax refunds and some benefit payments such as
unemployment insurance. No limit is imposed on appropriations of funds which are
not "proceeds of taxes," such as reasonable user charges or fees and certain
other non-tax funds.
Not included in the Appropriations Limit are appropriations for the debt
service costs of bonds existing or authorized by January 1, 1979, or
subsequently authorized by the voters, appropriations required to comply with
mandates of courts or the federal government, appropriations for qualified
capital outlay projects, appropriations of revenues derived from any increase in
gasoline taxes and motor vehicle weight fees above January 1, 1990 levels, and
appropriation of certain special taxes imposed by initiative (e.g., cigarette
and tobacco taxes). The Appropriations Limit may be exceeded in cases of
emergency.
The State's Appropriations Limit in each year is based on the limit for
the prior year, adjusted annually for changes in state per capita personal
income and changes in population, and adjusted, when applicable, for any
transfer of financial responsibility of providing services to or from another
unit of government or any transfer of the financial source for the provisions of
services from tax proceeds to non tax proceeds. The measurement of change in
population is a blended average of statewide overall population growth, and
change in attendance at local K-14 school districts. The Appropriations Limit is
tested over consecutive two-year periods. Any excess of the aggregate "proceeds
of taxes" received over such two-year period above the combined Appropriations
Limits for those two years is divided equally between transfers to K-14 school
districts and refunds to taxpayers.
The Legislature has enacted legislation to implement Article XIII B which
defines certain terms used in Article XIII B and sets forth the methods for
determining the Appropriations Limit. California Government Code Section 7912
requires an estimate of the Appropriations Limit to be included in the
Governor's Budget, and thereafter to be subject to the budget process and
established in the Budget Act.
The following table shows the State's Appropriations Limit for the past
four fiscal years and the current fiscal year. As of the enactment of the
1999-2000 Budget, the Department of Finance projects the State's Appropriations
Subject to Limitations will be $6.1 billion under the State's Appropriations
Limit in Fiscal Year 1999-00.
STATE APPROPRIATIONS LIMIT
(MILLIONS)
FISCAL YEARS
1995-96 1996-97 1997-98 1998-99* 1999-00*
State Appropriations Limit $39,309 $42,002 $44,778 $47,573 $50,673
Appropriations Subject to (34,186) (35,103) (40,743) (42,674) (44,528)
-------- -------- -------- -------- --------
Limit
Amount (Over)/Under Limit $5,123 $6,899 $4,035 $4,899 $6,145
====== ====== ====== ====== ======
- ------------------------------------------------------------------------------
- ---------------------
* Estimated/Projected
SOURCE: State of California, Department of Finance.
PROPOSITION 98
On November 8, 1988, voters of the State approved Proposition 98, a
combined initiative constitutional amendment and statute called the "Classroom
Instructional Improvement and Accountability Act." Proposition 98 changed State
funding of public education below the university level and the operation of the
State Appropriations Limit, primarily by guaranteeing K-14 schools a minimum
share of General Fund revenues. Under Proposition 98 (as modified by Proposition
111, which was enacted on June 5, 1990), K-14 schools are guaranteed the greater
of (a) in general, a fixed percent of General Fund revenues ("Test 1"), (b) the
amount appropriated to K-14 schools in the prior year, adjusted for changes in
the cost of living (measured as in Article XIII B by reference to State per
capita personal income) and enrollment ("Test 2"), or (c) a third test, which
would replace Test 2 in any year when the percentage growth in per capita
General Fund revenues from the prior year plus one half of one percent is less
than the percentage growth in State per capita personal income ("Test 3"). Under
Test 3, schools would receive the amount appropriated in the prior year adjusted
for changes in enrollment and per capita General Fund revenues, plus an
additional small adjustment factor. If Test 3 is used in any year, the
difference between Test 3 and Test 2 would become a "credit" to schools which
would be the basis of payments in future years when per capita General Fund
revenue growth exceeds per capita personal income growth. Legislation adopted
prior to the end of the 1988-89 Fiscal Year, implementing Proposition 98,
determined the K-14 schools' funding guarantee under Test 1 to be 40.3 percent
of the General Fund tax revenues, based on 1986-87 appropriations. However, that
percent has been adjusted to approximately 35 percent to account for a
subsequent redirection of local property taxes, since such redirection directly
affects the share of General Fund revenues to schools.
Proposition 98 permits the Legislature by two-thirds vote of both Houses,
with the Governor's concurrence, to suspend the K-14 schools' minimum funding
formula for a one-year period. Proposition 98 also contains provisions
transferring certain State tax revenues in excess of the Article XIII B limit to
K-14 schools. See "State Finances--State Appropriations Limit" above.
During the recession in the early 1990s, General Fund revenues for
several years were less than originally projected, so that the original
Proposition 98 appropriations turned out to be higher than the minimum
percentage provided in the law. The Legislature responded to these developments
by designating the "extra" Proposition 98 payments in one year as a "loan" from
future years' Proposition 98 entitlements, and also intended that the "extra"
payments would not be included in the Proposition 98 "base" for calculating
future years' entitlements. By implementing these actions, per-pupil funding
from Proposition 98 sources stayed almost constant at approximately $4,200 from
Fiscal Year 1991-92 to Fiscal Year 1993-94.
In 1992, a lawsuit was filed, California Teachers' Association v. Gould,
which challenged the validity of these off-budget loans. The settlement of this
case, finalized in July 1996, provides, among other things, that both the State
and K-14 schools share in the repayment of prior years' emergency loans to
schools. Of the total $1.76 billion in loans, the State is repaying $935 million
by forgiveness of the amount owed, while schools will repay $825 million. The
State share of the repayment will be reflected as an appropriation above the
current Proposition 98 base calculation. The schools' share of the repayment
will count as appropriations that count toward satisfying the Proposition 98
guarantee, or from "below" the current base. Repayments are spread over the
eight-year period of 1994-95 through 2001-02 to mitigate any adverse fiscal
impact.
Substantially increased General Fund revenues, above initial budget
projections, in the fiscal years 1994-95 through 1998-99 have resulted in
retroactive increases in Proposition 98 appropriations from subsequent fiscal
years' budgets. Because of the State's increasing revenues, per-pupil funding at
the K-12 level has increased by about 44 percent from the level in place from
1991-92 through 1993-94. A significant amount of the "extra" Proposition 98
monies in the last few years has been allocated to special programs,
particularly an initiative to allow each classroom with respect to grades K-3 to
have no more than 20 pupils by the end of the 1997-98 school year. Since the
State expects General Fund revenue growth to continue in 1999-00, there also are
new initiatives to increase school safety, improve schools' accountability for
pupil performance, provide additional textbooks to schools, fund deferred
maintenance projects, increase beginning teacher's salaries and provide
performance incentives to teachers. See "Current State Budget" for further
discussion of education funding.
PRIOR FISCAL YEARS' FINANCIAL RESULTS
The State's financial condition improved markedly during the fiscal years
starting in 1995-96, with a combination of better than expected revenues,
slowdown in growth of social welfare programs, and continued spending restraint
based on actions taken in earlier years. The State's cash position also
improved, and no external deficit borrowing occurred over the end of the last
four fiscal years. The last borrowing to spread out the repayment of a budget
deficit over the end of a fiscal year was $4.0 billion of revenue anticipation
warrants issued in July 1994 and which matured in April 1996.
The State economy grew strongly during the fiscal years beginning in
1995-96 and, as a result, the General Fund took in substantially greater tax
revenues (around $2.2 billion in 1995-96, $1.6 billion in 1996-97 and $2.4
billion in 1997-98 and $1.0 billion in 1998-99) than were initially planned when
the budgets were enacted. The accumulated budget deficit from the recession
years was finally eliminated with the repayment of the revenue anticipation
warrants in April 1996. These additional funds were largely directed to school
spending as mandated by Proposition 98, to make up shortfalls from reduced
federal health and welfare aid in 1995-96 and 1996-97 and particularly in
1998-99 to fund new program incentives.
The following were major features of the 1998 Budget Act and certain
additional fiscal bills enacted before the end of the legislative session:
1. The most significant feature of the 1998-99 budget was agreement on a
total of $1.4 billion of tax cuts. The central element was a bill which provided
for a phased-in reduction of the Vehicle License Fee ("VLF"). Since the VLF is
transferred to cities and counties under existing law, the bill provided for the
General Fund to replace the lost revenues. Starting on January 1, 1999, the VLF
has been reduced by 25 percent, at a cost to the General Fund of approximately
$500 million in the 1998-99 Fiscal Year and about $1 billion annually
thereafter.
In addition to the cut in VLF, the 1998-99 budget included both temporary
and permanent increases in the personal income tax dependent credit ($612
million General Fund cost in 1998-99, but less in future years), a nonrefundable
renters tax credit ($133 million), and various targeted business tax credits
($106 million).
2. Proposition 98 funding for K-14 schools was increased by $1.7 billion
in General Fund moneys over revised 1997-98 levels, over $300 million higher
than the minimum Proposition 98 guarantee. Of the 1998-99 funds, major new
programs included money for instructional and library materials, deferred
maintenance, support for increasing the school year to 180 days and reduction of
class sizes in Grade 9. The Budget also included $250 million as repayment of
prior years' loans to schools, as part of the settlement of the California
Teachers' Association v. Gould lawsuit. See "State Finances - Proposition 98"
above.
3. Funding for higher education increased substantially above the actual
1997-98 level. General Fund support was increased by $340 million (15.6 percent)
for the University of California and $267 million (14.1 percent) for the
California State University system. In addition, Community Colleges funding
increased by $300 million (6.6 percent).
4. The Budget included increased funding for health, welfare and social
services programs. A 4.9 percent grant increase was included in the basic
welfare grants, the first increase in those grants in 9 years.
5. Funding for the judiciary and criminal justice programs increased by
about 11 percent over 1997-98, primarily to reflect increased State support for
local trial courts and rising prison population.
6. Major legislation enacted after the 1998 Budget Act included new
funding for resources projects, a share of the purchase of the Headwaters
Forest, funding for the Infrastructure and Economic Development Bank ($50
million) and funding for the construction of local jails. The State realized
savings of $433 million from a reduction in the State's contribution to the
State Teacher's Retirement System in 1998-99.
The revised 1999-2000 Governor's Budget, released on May 14, 1999 (the
"1999 May Revision"), reported that stronger than expected economic conditions
in the State for the latter part of 1998 and into 1999 would produce total
1998-99 General Fund revenues of about $57.9 billion, almost $1.0 billion above
the 1998 Budget Act estimates and $1.6 billion above the initial estimates in
the January 1999-2000 Governor's Budget. The 1999 May Revision projected 1998-99
General Fund expenditures of $58.6 billion, about $400 million higher than the
January 1999-2000 Governor's Budget estimate. Some of this additional revenue
will be directed to K-14 schools pursuant to Proposition 98. The 1999 May
Revision projected a balance in the SFEU at June 30, 1999 of approximately $1.9
billion, $1.3 billion higher than estimated in January 1999.
CURRENT STATE BUDGET
The discussion below of the 1999-00 Fiscal Year budget is based on the
State's estimates and projections of revenues and expenditures for the current
fiscal year and must not be construed as statements of fact. These estimates and
projections are based upon various assumptions as updated in the 1999 Budget
Act, which may be affected by numerous factors, including future economic
conditions in the State and the nation, and there can be no assurance that the
estimates will be achieved.
1999-2000 FISCAL YEAR BUDGET
On January 8, 1999, the Governor released a proposed budget for Fiscal
Year 1999-00 (the "January Governor's Budget"). The January Governor's Budget
generally reported that General Fund revenues for Fiscal Year 1998-99 and Fiscal
Year 1999-00 would be lower than earlier projections (primarily due to weaker
overseas economic conditions perceived in late 1998), while some caseloads would
be higher than earlier projections. The January Governor's Budget proposed $60.5
billion of General Fund expenditures in Fiscal Year 1999-00, with a $415 million
SFEU reserve at June 30, 2000.
The 1999 May Revision showed an additional $4.3 billion of revenues for
combined fiscal years 1998-99 and 1999-00. The final Budget Bill was adopted by
the Legislature on June 16, 1999, and was signed by the Governor on June 29,
1999 (the "1999 Budget Act"), meeting the Constitutional deadline for budget
enactment for only the second time in the 1990's.
The final 1999 Budget Act estimated General Fund revenues and transfers
of $63.0 billion, and contained expenditures totaling $63.7 billion after the
Governor used the line-item veto to reduce the legislative Budget Bill
expenditures by $581 million (both General Fund and Special Fund). The 1999
Budget Act also contained expenditures of $16.1 billion from special funds and
$1.5 billion from bond funds. The Administration estimated that the SFEU would
have a balance at June 30, 2000, of about $880 million. Not included in this
amount was an additional $300 million which (after the Governor's vetoes) was
"set aside" to provide funds for employee salary increases (to be negotiated in
bargaining with employee unions), and for litigation reserves. The 1999 Budget
Act anticipates normal cash flow borrowing during the fiscal year.
The principal features of the 1999 Budget Act include the following:
1. Proposition 98 funding for K-12 schools was increased by $1.6 billion
in General Fund moneys over revised 1998-99 levels, $108.6 million higher than
the minimum Proposition 98 guarantee. Of the 1999-00 funds, major new programs
included money for reading improvement, new textbooks, school safety, improving
teacher quality, funding teacher bonuses, providing greater accountability for
school performance, increasing preschool and after school care programs and
funding deferred maintenance of school facilities. The Budget also includes $310
million as repayment of prior years' loans to schools, as part of the settlement
of the California Teachers' Association v. Gould lawsuit. See also "State
Finances - Proposition 98" above.
2. Funding for higher education increased substantially above the actual
1998-99 level. General Fund support was increased by $184 million (7.3 percent)
for the University of California and $126 million (5.9 percent) for the
California State University system. In addition, Community Colleges funding
increased by $324.3 million (6.6 percent). As a result, undergraduate fees at UC
and CSU will be reduced for the second consecutive year, and the per-unit charge
at Community Colleges will be reduced by $1.
3. The Budget included increased funding of nearly $600 million for
health and human services.
4. About $800 million from the General Fund will be directed toward
infrastructure costs, including $425 million in additional funding for the
Infrastructure Bank, initial planning costs for a new prison in the Central
Valley, additional equipment for train and ferry service, and payment of
deferred maintenance for state parks.
5. The Legislature enacted a one-year additional reduction of 10 percent
of the VLF for calendar year 2000, at a General Fund cost of about $250 million
in each of Fiscal Year 1999-00 and Fiscal Year 2000-01 to make up lost funding
to local governments. Conversion of this one-time reduction to a permanent cut
will remain subject to the revenue tests in the legislation adopted last year.
Several other targeted tax cuts, primarily for businesses, also were approved at
a cost of $54 million in Fiscal Year 1999-00.
6. A one-time appropriation of $150 million, to be split between cities
and counties, was made to offset property tax shifts during the early 1990's.
Additionally, an ongoing $50 million was appropriated as a subvention to cities
for jail booking or processing fees charged by counties when an individual
arrested by city personnel is taken to a county detention facility.
ECONOMY AND POPULATION
INTRODUCTION
California's economy, the largest among the 50 states and one of the
largest in the world, has major components in high technology, trade,
entertainment, agriculture, manufacturing, tourism, construction and services.
Since 1994, California's economy has been performing strongly after suffering a
deep recession between 1990-94.
POPULATION AND LABOR FORCE
The State's July 1, 1998 population of over 33.4 million represented over
12 percent of the total United States population.
California's population is concentrated in metropolitan areas. As of the
April 1, 1990 census, 96 percent resided in the 23 Metropolitan Statistical
Areas in the State. As of July 1, 1998, the 5-county Los Angeles area accounted
for 49 percent of the State's population, with over 16.0 million residents, and
the 10-county San Francisco Bay Area represented 21 percent, with a population
of over 7.0 million.
The following table shows California's population data for 1994 through
1998.
POPULATION 1994-98
% INCREASE % INCREASE
OVER OVER CALIFORNIA
CALIFORNIA PRECEDING UNITED STATES PRECEDING AS % OF
YEAR POPULATION(A) YEAR POPULATION(A) YEAR UNITED
STATES
1994 31,790,000 0.9 260,292,000 1.0 12.2
1995 32,063,000 0.9 262,761,000 0.9 12.2
1996 32,383,000 1.0 265,179,000 0.9 12.2
1997 32,957,000 1.8 267,636,000 0.9 12.3
1998 33,494,000 1.6 270,029,000 0.9 12.4
- --------------
(a) Population as of July 1.
SOURCE: U.S. Department of Commerce, Bureau of the Census; State of
California, Department of Finance.
The following table presents civilian labor force data for the resident
population, age 16 and over, for the years 1993 to 1998.
LABOR FORCE
1993-98
LABOR FORCE TRENDS (THOUSANDS) UNEMPLOYMENT RATE (%)
LABOR UNITED
YEAR FORCE EMPLOYMENT CALIFORNIA STATES
1993 15,359 13,918 9.4 6.9
1994 15,450 14,122 8.6 6.1
1995 15,412 14,203 7.8 5.6
1996 15,511 14,391 7.2 5.4
1997 15,941 14,937 6.3 4.9
1998 16,330 15,361 5.9 4.5
- -----------------
SOURCE: State of California, Employment Development Department.
<PAGE>
EMPLOYMENT, INCOME, CONSTRUCTION AND EXPORT GROWTH
The following table shows California's nonagricultural employment
distribution and growth for 1990 and 1998.
PAYROLL EMPLOYMENT BY MAJOR SECTOR
1990 AND 1998
EMPLOYMENT % DISTRIBUTION
(THOUSANDS) OF
EMPLOYMENT
INDUSTRY SECTOR 1990 1998 1990 1998
- --------------- ---- ---- ---- ----
Mining................ 39 25 0.3 0.2
Construction.......... 605 602 4.8 4.4
Manufacturing.........
Nondurable Goods... 721 729 5.7 5.4
High Technology.... 686 534 5.4 3.9
Other Durable goods 690 697 5.4 5.1
Transportation and 624 694 4.9 5.1
Utilities.............
Wholesale and Retail 3,002 3,122 23.7 23.0
Trade
Finance, Insurance
and Real Estate.... 825 798 6.5 5.9
Services.............. 3,395 4,220 26.8 31.1
Government
Federal............ 362 269 2.9 2.0
State and Local.... 1,713 1,894 13.5 13.9
----- ----- ---- ----
TOTAL
NONAGRICULTURAL.... 12,662 13,584 100 100
====== ====== === ===
SOURCE: State of California, Employment Development Department and State of
California, Department of Finance.
The following tables show California's total and per capita income
patterns for selected years.
TOTAL PERSONAL INCOME 1993-98
CALIFORNIA
CALIFORNIA
% OF
YEAR MILLIONS % CHANGE U.S.
- ---- -------- -------- ----
1993 $698,130 2.0* 12.8
1994a 718,321 2.9 12.5
1995 754,269 5.0 12.4
1996 798,020 5.8 12.5
1997 846,017 6.0 12.5
1998b 904,444 6.9 12.7
* Change from prior year.
a Reflects Northridge earthquake, which caused an estimated $15 billion drop in
personal income.
b Estimated by the State of California, Department of Finance.
Note: Omits income for government employees overseas.
SOURCE: U.S. Department of Commerce, Bureau of Economic Analysis.
PER CAPITA PERSONAL INCOME 1993-98
CALIFORNIA
UNITED % OF
YEAR CALIFORNIA % CHANGE STATES % CHANGE U.S.
- ---- ---------- -------- ------ -------- ----
1993 ......... $22,388 1.0* $21,220 3.3* 105.5
1994a ......... 22,899 2.3 22,056 3.9 103.8
1995 ......... 23,901 4.4 23,063 4.6 103.6
1996 ......... 25,050 4.8 24,169 4.8 103.6
1997 ......... 26,218 4.7 25,298 4.7 103.6
1998 ......... 27,116b 3.4 26,368c 4.2 102.8
* Change from prior year
a Reflects Northridge earthquake, which caused an estimated $15 billion drop in
personal income.
b Estimated by the State of California, Department of Finance.
c Estimated by the U.S. Department of Commerce, Bureau of Economic Analysis.
SOURCE: U.S. Department of Commerce, Bureau of Economic Analysis.
LITIGATION
The State is a party to numerous legal proceedings. The following are the
more significant lawsuits pending against the State, as reported by the Office
of the Attorney General.
On December 24, 1997, a consortium of California counties filed a test
claim with the Commission on State Mandates asking the Commission on State
Mandates to determine whether the property tax shift from counties to school
districts beginning in 1993-94 is a reimbursable state mandated cost. See "State
Finances - Local Governments" above. The test claim was heard on October 29,
1998, and the Commission on State Mandates found in favor of the State. In March
1999, Sonoma County filed suit in the Superior Court to overturn the Commission
on State Mandate's decision. In October 1999, a Sonoma County Superior Court
Judge ruled in favor of the County. The State will continue to contest this
lawsuit. Should the courts ultimately find in favor of the counties, the impact
to the State General Fund could be as high as $10.0 billion. In addition, there
would be an annual Proposition 98 General Fund cost of at least $3.75 billion.
This cost would grow in accordance with the annual assessed value growth rate.
On June 24, 1998, plaintiffs in Howard Jarvis Taxpayers Association et
al. v. Kathleen Connell filed a complaint for certain declaratory and injunctive
relief challenging the authority of the State Controller to make payments from
the State Treasury in the absence of a state budget. On July 21, 1998, the trial
court issued a preliminary injunction prohibiting the State Controller from
paying moneys from the State Treasury for fiscal year 1998-99, with certain
limited exceptions, in the absence of a state budget. The preliminary
injunction, among other things, prohibited the State Controller from making any
payments pursuant to any continuing appropriation. On July 22 and 27, 1998,
various employee unions which had intervened in the case appealed the trial
court's preliminary injunction and asked the Court of Appeal to stay the
preliminary injunction. On July 28, 1998, the Court of Appeal granted the
unions' requests and stayed the preliminary injunction pending the Court of
Appeal's decision on the merits of the appeal. On August 5, 1998, the Court of
Appeal denied the plaintiffs' request to reconsider the stay. Also on July 22,
1998, the State Controller asked the California Supreme Court to immediately
stay the trial court's preliminary injunction and to overrule the order granting
the preliminary injunction on the merits. On July 29, 1998, the Supreme Court
transferred the State Controller's request to the Court of Appeal. The matters
are now pending before the Court of Appeal. Briefs have been submitted; no date
has yet been set for oral argument.
The State is involved in a lawsuit, Thomas Hayes v. Commission on State
Mandates, related to state-mandated costs. The action involves an appeal by the
Director of Finance from a 1984 decision by the State Board of Control (now
succeeded by the Commission on State Mandates (COSM)). The Board of Control
decided in favor of local school districts' claims for reimbursement for special
education programs for handicapped students. The case then was brought to the
trial court by the State and later remanded to the COSM for redetermination. The
COSM since has expanded the claim to include supplemental claims filed by
several other institutions. To date, the Legislature has not appropriated funds.
The liability to the State, if all potentially eligible school districts pursue
timely claims, has been estimated by the Department of Finance at more than $1
billion. The Commission on State Mandates issued a decision in December 1998
determining that a small number of components of the State's special education
program are state mandated local costs. The administrative proceeding is in the
"parameters and guidelines" stage where the commission is considering whether
and to what extent the costs associated with the state mandated components of
the special education program are offset by funds that the State already
allocates to that program. The State's position is that all costs are offset by
existing funding. The State has the option to seek judicial review of the
mandate finding.
In Capitola Land v. Anderson and other related state and federal cases,
plaintiffs sought payments from the State under the AFDC-Foster Care program.
Judgment was rendered against the State in Capitola, which the State appealed
and lost. The State then filed a state plan amendment with the federal
Department of Health and Human Services ("DHHS") to enable the State to comply
with the Capitola ruling and receive federal funding. The DHHS denied the state
plan amendment, and the State has filed suit against DHHS. The State Legislature
enacted a statute that conditioned State compliance with the Capitola judgment
on receipt of federal funding (50% contribution). The State then refused to
implement the Capitola judgment based on the new statute. Certain plaintiffs
moved for an order of contempt against the State, which was granted by the trial
court, but was stayed and annulled by the Court of Appeal. The plaintiffs'
petition for review was denied by the California Supreme Court. However, the
State continues to pursue federal funding in federal court. If, as a result of
this litigation, compliance with the Capitola judgment is required and the
judgment is applied retroactively, liability to the State could exceed $200
million.
In January 1997, California experienced major flooding in six different
areas with preliminary estimates of property damage of approximately $1.6 to
$2.0 billion. A substantial number of plaintiffs have joined suit against the
State, local agencies, and private companies and contractors seeking
compensation for the damages they suffered as a result of the 1997 flooding. The
State is vigorously defending the action.
In Just Say No to Tobacco Dough Campaign v. State of California, the
petitioners challenge the appropriation of approximately $166 million of
Proposition 99 funds in the Cigarette and Tobacco Products Surtax Fund for years
ended June 30, 1990, through June 30, 1995, for related disease research. If the
State loses, the General Fund and funds from other sources would be used to
reimburse the Cigarette and Tobacco Products Surtax Fund, an agency fund, for
approximately $166 million. However, the superior court issued an order in
December 1998 granting the State's demurrer to the entire action and dismissing
the case. The superior court thereafter reconsidered its ruling and allowed
plaintiffs to amend their complaint. The State demurred to the amended
complaint. In July 1999, the court again sustained the State's demurrer to the
amended complaint and issued a judgment dismissing the case. Plaintiffs
appealed. The matter will be briefed and will be scheduled for oral argument
before the court.
The State is a defendant in Ceridian Corporation v. Franchise Tax Board,
a suit which challenges the validity of two sections of the California Tax Laws.
The first relates to deduction from corporate taxes for dividends received from
insurance companies to the extent the insurance companies have California
activities. The second relates to corporate deduction of dividends to the extent
the earnings of the dividend paying corporation have already been included in
the measure of their California tax. On August 13, 1998, the court issued a
judgment against the Franchise Tax Board on both issues. The Franchise Tax Board
has appealed the judgment. Briefing is underway. If both sections of the
California tax law are invalidated and all dividends become deductible, General
Fund collections in the future would be reduced annually in the $200-$250
million range for all taxpayers.
The State is involved in a lawsuit related to contamination at the
Stringfellow toxic waste site. In United States, People of the State of
California v. J.B. Stringfellow, Jr., et al., the State is seeking recovery for
past costs of cleanup of the site, a declaration that the defendants are jointly
and severally liable for future costs, and an injunction ordering completion of
the cleanup. However, the defendants have filed a counterclaim against the State
for alleged negligent acts, resulting in significant findings of liability
against the State as owner, operator, and generator of wastes taken to the site.
The State has appealed the rulings. Present estimates of the cleanup range from
$400 million to $600 million. Potential State liability falls within this same
range. However, all or a portion of any judgment against the State could be
satisfied by recoveries from the State's insurance carriers. The State has filed
a suit against certain of these carriers and trial is currently set for January
16, 2001.
The State is a defendant in a coordinated action involving 3,000
plaintiffs seeking recovery for damages caused by the Yuba River flood of
February 1986. The trial court found liability in inverse condemnation and
awarded damages of $500,000 to a sample of plaintiffs. The State's potential
liability to the remaining plaintiffs ranges from $800 million to $1.5 billion.
In 1992, the State and plaintiffs filed appeals. In August 1999, the Court of
Appeal issued a decision reversing the trial court's judgment against the State
and remanding the case for retrial on the inverse condemnation cause of action.
Plaintiffs have petitioned the California Supreme Court for review.
The State is a defendant in a statewide action, Emily Q., et al. v.
Belshe, et al., in which plaintiffs seek to compel a change in early screening
procedures for children with mental health needs. A preliminary injunction was
issued, requiring changes in the screening procedures. The Department of Health
Services, in conjunction with the Department of Mental Health, is in the process
of complying with the injunction. No hearing has been scheduled on the petition
for permanent injunction. The Department of Mental Health estimates the annual
cost to the State for implementation of a permanent injunction to be
approximately $13 million.
Plaintiffs in County of San Bernardino v. Barlow Respiratory Hospital and
related actions seek mandamus relief requiring the State to retroactively
increase out-patient Medi-Cal reimbursement rates. Plaintiffs have estimated the
damages to be several hundred million dollars. The State is vigorously defending
these cases, as well as related federal cases addressing the calculation of
Medi-Cal reimbursement rates in the future.
The State is involved in two refund actions, Cigarettes Cheaper!, et
al. v. Board of Equalization, et al. and California Assn. Of Retail
Tobacconists (CART), et al. v. Board of Equalization, et al., that challenge
the constitutionality of Proposition 10, approved by the voters in 1998.
Plaintiffs allege that Proposition 10, which increases the excise tax on
tobacco products, violates 11 sections of the California Constitution and
related provisions of law. Plaintiffs Cigarettes Cheaper! seek declaratory
and injunctive relief and a refund of over $4 million. The CART case filed
by retail tobacconists in San Diego seeks a refund of $5 million. The State
is vigorously contesting these cases. If the statute is declared
unconstitutional, exposure may include the entire $750 million collected
annually with interest.
The State is involved in two cases challenging the constitutionality of
the interest offset provisions of the Revenue and Taxation Code. Plaintiffs in
F. W. Woolworth Co. and Kinney Shoe Corporation v. Franchise Tax Board seek a
refund of over $15 million. The Woolworth case was tried in July 1995 and
judgment was entered for the Franchise Tax Board. The judgment was upheld on
appeal and the plaintiffs' petition for review in the California Supreme Court
was denied. On June 7, 1999, plaintiffs filed a petition for writ of certiorari
in the United States Supreme Court. The Franchise Tax Board filed its opposition
to the petition for writ of certiorari on August 5, 1999.
Hunt-Wesson, Inc. v. Franchise Tax Board was tried in February 1997 with
judgment for the taxpayer. The judgment was reversed on appeal and plaintiffs
petition for review in the California Supreme Court was denied. On September 28,
1999, the United States Supreme Court granted the taxpayer's petition for writ
of certiorari. The Franchise Tax Board estimates that if the interest-offset
provisions are declared unconstitutional, the result would involve potential
reduction of state revenues in the $90 million range annually, with past year
collection and interest exposure of $500 million.
Guy F. Atkinson Company of California v. Franchise Tax Board is a
corporation tax refund action involving the solar energy system tax credit
provided for under the Revenue and Taxation Code. The case went to trial in May
1998 and the trial court entered judgment in favor of the Franchise Tax Board.
The taxpayer has filed an appeal to the California Court of Appeal and briefing
is due to be completed in October 1999. The Franchise Tax Board estimates that
the cost would be $150 million annually if the plaintiff prevails. Allowing
refunds for all open years would entail a refund of at least $500 million.
Jordan, et al. v. Department of Motor Vehicles, et al. and Josephs v.
Zolin, et al. challenge the validity of the Vehicle Smog Impact Fee, a $300 fee
which is collected by the Department of Motor Vehicles from vehicle registrants
when a vehicle without a California new-vehicle certification is first
registered in California. The Jordan plaintiffs contend that the fee violates
the interstate commerce and equal protection clauses of the United States
Constitution as well as Article XIX of the State Constitution. The Josephs case
is a class action civil rights case brought against the current and former
directors of the Department of Motor Vehicles in their individual capacities
claiming the collection of the Vehicle Smog Impact Fee violates the interstate
commerce, equal protection, and privileges and immunities clauses of the United
States Constitution. In October 1999, the Court of Appeals upheld a trial court
judgment for the plaintiffs in the Jordan case, and the State has declined to
appeal further. Although refunds through the court actions could be limited by a
three-year statute of limitations, with a potential liability of about $350
million, the Governor has proposed refunding fees collected back to the
initiation of these fees in 1990. The exposure to the State if the fees are
refunded in full could be up to $800 million.
Craig Brown, et al. v. Department of Health and Human Services, et al. is
a Federal Mandate Proceeding. In fiscal years 1991-92 and 1992-93, the State
used credits from three Public Employees Retirement System accounts in place of
General Fund employer pension contributions. The DHHS has determined that
federally funded programs were overcharged in these fiscal years because they
did not receive the pension credits the State programs received and that
California owes the federal government $120 million for overpayments plus an
additional $80 million in interest through mid 1999. The DHHS Grant Appeals
Board upheld this determination. The present case is aimed at overturning the
DHHS determination. On June 6, 1999, the court ruled against the State. The
State has appealed to the Ninth Circuit. The estimated potential loss is over
$220 million which would be payable from the General Fund or, possibly,
recovered by the federal government through offsets against current grant
payments to the State.
PTI, Inc., et al. v. Philip Morris, et al. was filed by five distributors
in the cigarette import/re-entry business, seeking to overturn the tobacco
Master Settlement Agreement ("MSA") entered between 46 states and the tobacco
industry in November 1998. See "State Finances - Tobacco Litigation" above. The
primary focus of the complaint is the provision of the MSA encouraging
participating states to adopt a statute requiring nonparticipating manufacturers
to either become participating manufacturers and share the financial obligations
under the MSA or pay money into an escrow account. Plaintiffs seek compensatory
and punitive damages against the State and State officials and an order placing
tobacco settlement funds into a trust to be administered by the court for the
treatment of medical expenses of persons injured by tobacco products. A motion
to dismiss the complaint is currently scheduled for hearing in February 2000.
The potential fiscal impact of an adverse ruling is largely unknown, but could
exceed the full amount of the settlement (estimated to be $1 billion annually,
of which 50% will go directly to the State's General Fund and the other 50%
directly to the State's 58 counties and 4 largest cities).
Arnett v. California Public Employees Retirement System, et. al. was
filed by seven former employees of the State of California and local agencies
seeking back wages, damages and injunctive relief. Plaintiffs are former public
safety members who began employment after the age of 40 and are recipients of
Industrial Disability Retirement ("IDR") benefits. Plaintiffs contend that the
formula which determines the amount of IDR benefits violates the federal Age
Discrimination in Employment Act of 1967. Plaintiffs contend that, but for their
ages at hire, they would receive increased monthly IDR benefits similar to their
younger counterparts who began employment before the age of 40. On August 17,
1999, the Ninth Circuit Court of Appeals reversed the District Court's dismissal
of the complaint for failure to state a claim. The State may seek further review
in the United States Supreme Court. However, the case has now been remanded back
to the District Court and trial will most likely occur in December 2000. In the
event of an unfavorable result, CalPERS has estimated the liability to the State
as approximately $315.5 million.
YEAR 2000-RELATED INFORMATION TECHNOLOGY
The State's reliance on information technology in every aspect of its
operations made year 2000-related ("Y2K") information technology ("IT") issues a
high priority for the State. The Department of Information Technology ("DOIT"),
an independent office reporting directly to the Governor, was responsible for
ensuring the State's information technology processes were fully functional
before the year 2000.
The DOIT estimates total Y2K costs identified by the departments under
its supervision at about $357 million. These costs are part of much larger
overall IT costs incurred annually by the State, including costs incurred by
certain independent State entities, such as the judiciary, the Legislature, the
University of California and California State University System. Furthermore,
cost estimates for embedded systems only apply to the subset of embedded systems
posing the highest risk to essential programs. For fiscal year 1999-00, the
Legislature created a fund of $33.5 million ($13.5 million General Fund) for
unanticipated Y2K costs, which can be increased if necessary.
<PAGE>
APPENDIX B
Description of certain S&P, Moody's and Fitch ratings:
S&P
Municipal Bond Ratings
An S&P municipal bond rating is a current assessment of the
creditworthiness of an obligor with respect to a specific obligation.
The ratings are based on current information furnished by the issuer or
obtained by S&P from other sources it considers reliable, and will include: (1)
likelihood of default-capacity and willingness of the obligor as to the timely
payment of interest and repayment of principal in accordance with the terms of
the obligation; (2) nature and provisions of the obligation; and (3) protection
afforded by, and relative position of, the obligation in the event of
bankruptcy, reorganization or other arrangement under the laws of bankruptcy and
other laws affecting creditors' rights.
AAA
Debt rated AAA has the highest rating assigned by S&P. Capacity to pay
interest and repay principal is extremely strong.
AA
Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the highest rated issues only in a small degree.
A
Principal and interest payments on bonds in this category are regarded as
safe. This rating describes the third strongest capacity for payment of debt
service. It differs from the two higher ratings because:
General Obligation Bonds -- There is some weakness in the local economic
base, in debt burden, in the balance between revenues and expenditures, or in
quality of management. Under certain adverse circumstances, any one such
weakness might impair the ability of the issuer to meet debt obligations at some
future date.
Revenue Bonds -- Debt service coverage is good, but not exceptional.
Stability of the pledged revenues could show some variations because of
increased competition or economic influences on revenues. Basic security
provisions, while satisfactory, are less stringent. Management performance
appears adequate.
BBB
Of the investment grade, this is the lowest.
General Obligation Bonds -- Under certain adverse conditions, several of
the above factors could contribute to a lesser capacity for payment of debt
service. The difference between "A" and "BBB" rating is that the latter shows
more than one fundamental weakness, or one very substantial fundamental
weakness, whereas the former shows only one deficiency among the factors
considered.
Revenue Bonds -- Debt coverage is only fair. Stability of the pledged
revenues could show substantial variations with the revenue flow possibly being
subject to erosion over time. Basic security provisions are no more than
adequate. Management performance could be stronger.
BB, B, CCC, CC, C
Debt rated BB, B, CCC, CC or C is regarded as having predominantly
speculative characteristics with respect to capacity to pay interest and repay
principal. BB indicates the least degree of speculation and C the highest degree
of speculation. While such debt will likely have some quality and protective
characteristics, these are outweighed by large uncertainties or major risk
exposures to adverse conditions.
BB
Debt rated BB has less near-term vulnerability to default than other
speculative grade debt. However, it faces major ongoing uncertainties or
exposure to adverse business, financial or economic conditions which could lead
to inadequate capacity to meet timely interest and principal payments.
B
Debt rated B has a greater vulnerability to default but presently has the
capacity to meet interest payments and principal repayments. Adverse business,
financial or economic conditions would likely impair capacity or willingness to
pay interest and repay principal.
CCC
Debt rated CCC has a current identifiable vulnerability to default, and is
dependent upon favorable business, financial and economic conditions to meet
timely payments of principal. In the event of adverse business, financial or
economic conditions, it is not likely to have the capacity to pay interest and
repay principal.
CC
The rating CC is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC rating.
C
The rating C is typically applied to debt subordinated to senior debt
which is assigned an actual or implied CCC- debt rating.
D
Bonds rated D are in default, and payment of interest and/or repayment of
principal is in arrears.
Plus (+) or minus (-): The ratings from AA to CCC may be modified by the
addition of a plus or minus sign to show relative standing within the major
ratings categories.
Municipal Note Ratings
SP-1
The issuers of these municipal notes exhibit very strong or strong
capacity to pay principal and interest. Those issues determined to possess
overwhelming safety characteristics are given a plus (+) designation.
SP-2
The issuers of these municipal notes exhibit satisfactory capacity to pay
principal and interest.
Commercial Paper 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.
Moody's
Municipal Bond Ratings
Aaa
Bonds rated Aaa are judged to be of the best quality. They carry the
smallest degree of investment risk and are generally referred to as "gilt edge."
Interest payments are protected by a large or by an exceptionally stable margin
and principal is secure. While the various protective elements are likely to
change, such changes as can be visualized are most unlikely to impair the
fundamentally strong position of such issues.
Aa
Bonds rated Aa are judged to be of high quality by all standards. Together
with the Aaa group they comprise what generally are known as high-grade bonds.
They are rated lower than the best bonds because margins of protection may not
be as large as in Aaa securities or fluctuation of protective elements may be of
greater amplitude or there may be other elements present which make the
long-term risks appear somewhat larger than in Aaa securities.
A
Bonds rated A possess many favorable investment attributes and are to be
considered as upper medium-grade obligations. Factors giving security to
principal and interest are considered adequate, but elements may be present
which suggest a susceptibility to impairment some time in the future.
Baa
Bonds rated Baa are considered as medium grade obligations, i.e., they are
neither highly protected nor poorly secured. Interest payments and principal
security appear adequate for the present but certain protective elements may be
lacking or may be characteristically unreliable over any great length of time.
Such bonds lack outstanding investment characteristics and in fact have
speculative characteristics as well.
Ba
Bonds rated Ba are judged to have speculative elements; their future
cannot be considered as well assured. Often the protection of interest and
principal payments may be very moderate, and therefore not well safeguarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.
B
Bonds rated B generally lack characteristics of the desirable investment.
Assurance of interest and principal payments or of maintenance of other terms of
the contract over any long period of time may be small.
Caa
Bonds rated Caa are of poor standing. Such issues may be in default or
there may be present elements of danger with respect to principal or interest.
Ca
Bonds rated Ca present obligations which are speculative in a high degree.
Such issues are often in default or have other marked shortcomings.
C
Bonds rated C are the lowest rated class of bonds, and issues so rated can
be regarded as having extremely poor prospects of ever attaining any real
investment standing.
Moody's applies the numerical modifiers 1, 2 and 3 to show relative
standing within the major rating categories, except in the Aaa category and in
the categories below B. The modifier 1 indicates a ranking for the security in
the higher end of a rating category; the modifier 2 indicates a mid-range
ranking; and the modifier 3 indicates a ranking in the lower end of a rating
category.
Municipal Note Ratings
Moody's ratings for state municipal notes and other short-term loans are
designated Moody's Investment Grade (MIG). Such ratings recognize the
differences between short-term credit risk and long-term risk. Factors affecting
the liquidity of the borrower and short-term cyclical elements are critical in
short-term ratings, while other factors of major importance in bond risk,
long-term secular trends for example, may be less important over the short run.
A short-term rating may also be assigned on an issue having a demand
feature. Such ratings will be designated as VMIG or, if the demand feature is
not rated, as NR. Short-term ratings on issues with demand features are
differentiated by the use of the VMIG symbol to reflect such characteristics as
payment upon periodic demand rather than fixed maturity dates and payment
relying on external liquidity. Additionally, investors should be alert to the
fact that the source of payment may be limited to the external liquidity with no
or limited legal recourse to the issuer in the event the demand is not met.
Moody's short-term ratings are designated Moody's Investment Grade as MIG
1 or VMIG 1 through MIG 4 or VMIG 4. As the name implies, when Moody's assigns a
MIG or VMIG rating, all categories define an investment grade situation.
MIG 1/VMIG 1
This designation denotes best quality. There is present strong protection
by established cash flows, superior liquidity support or demonstrated
broad-based access to the market for refinancing.
MIG 2/VMIG 2
This designation denotes high quality. Margins of protection are ample
although not so large as in the preceding group.
Commercial Paper Rating
The rating Prime-1 (P-1) is the highest commercial paper rating assigned
by Moody's. Issuers of P-1 paper must have a superior capacity for repayment of
short-term promissory obligations, and ordinarily will be evidenced by leading
market positions in well established industries, high rates of return on funds
employed, conservative capitalization structures with moderate reliance on debt
and ample asset protection, broad margins in earnings coverage of fixed
financial charges and high internal cash generation, and well established access
to a wide range of financial markets and assured sources of alternative
liquidity.
Issuers (or related supporting institutions) rated Prime-2 (P-2) have a
strong capacity for repayment of short-term promissory obligations. This
ordinarily will be evidenced by many of the characteristics cited above but to a
lesser degree. Earnings trends and coverage ratios, while sound, will be more
subject to variation. Capitalization characteristics, while still appropriate,
may be more affected by external conditions. Ample alternate liquidity is
maintained.
Fitch
Municipal Bond Ratings
The ratings represent Fitch's assessment of the issuer's ability to meet
the obligations of a specific debt issue or class of debt. The ratings take into
consideration special features of the issue, its relationship to other
obligations of the issuer, the current financial condition and operative
performance of the issuer and of any guarantor, as well as the political and
economic environment that might affect the issuer's future financial strength
and credit quality.
AAA
Bonds rated AAA are considered to be investment grade and of the highest
credit quality. The obligor has an exceptionally strong ability to pay interest
and repay principal, which is unlikely to be affected by reasonably foreseeable
events.
AA
Bonds rated AA are considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and repay principal is
very strong, although not quite as strong as bonds rated AAA. Because bonds
rated in the AAA and AA categories are not significantly vulnerable to
foreseeable future developments, short-term debt of these issuers is generally
rated F-1+.
A
Bonds rated A are considered to be investment grade and of high credit
quality. The obligor's ability to pay interest and repay principal is considered
to be strong, but may be more vulnerable to adverse changes in economic
conditions and circumstances than bonds with higher ratings.
BBB
Bonds rated BBB are considered to be investment grade and of satisfactory
credit quality. The obligor's ability to pay interest and repay principal is
considered to be adequate. Adverse changes in economic conditions and
circumstances, however, are more likely to have adverse impact on these bonds
and, therefore, impair timely payment. The likelihood that the ratings of these
bonds will fall below investment grade is higher than for bonds with higher
ratings.
BB
Bonds rated BB are considered speculative. The obligor's ability to pay
interest and repay principal may be affected over time by adverse economic
changes. However, business and financial alternatives can be identified which
could assist the obligor in satisfying its debt service requirements.
B
Bonds rated B are considered highly speculative. While bonds in this class
are currently meeting debt service requirements, the probability of continued
timely payment of principal and interest reflects the obligor's limited margin
of safety and the need for reasonable business and economic activity throughout
the life of the issue.
CCC
Bonds rated CCC have certain identifiable characteristics, which, if not
remedied, may lead to default. The ability to meet obligations requires an
advantageous business and economic environment.
CC
Bonds rated CC are minimally protected. Default in payment of interest
and/or principal seems probable over time.
C
Bonds rated C are in imminent default in payment of interest or principal.
DDD, DD and D
Bonds rated DDD, DD and D are in actual or imminent default of interest
and/or principal payments. Such bonds are extremely speculative and should be
valued on the basis of their ultimate recovery value in liquidation or
reorganization of the obligor. DDD represents the highest potential for recovery
on these bonds and D represents the lowest potential for recovery.
Plus (+) and minus (-) signs are used with a rating symbol to indicate the
relative position of a credit within the rating category. Plus and minus signs,
however, are not used in the AAA category covering 12-36 months or the DDD, DD
or D categories.
Short-Term Ratings
Fitch's short-term ratings apply to debt obligations that are payable on
demand or have original maturities of up to three years, including commercial
paper, certificates of deposit, medium-term notes, and municipal and investment
notes.
Although the credit analysis is similar to Fitch's bond rating analysis,
the short-term rating places greater emphasis than bond ratings on the existence
of liquidity necessary to meet the issuer's obligations in a timely manner.
F-1+
Exceptionally Strong Credit Quality. Issues assigned this rating are
regarded as having the strongest degree of assurance for timely payment.
F-1
Very Strong Credit Quality. Issues assigned this rating reflect an
assurance of timely payment only slightly less in degree than issues rated F-1+.
F-2
Good Credit Quality. Issues carrying this rating have a satisfactory
degree of assurance for timely payments, but the margin of safety is not as
great as the F-1+ and F-1 categories.
DREYFUS PREMIER CALIFORNIA MUNICIPAL BOND FUND
PART C. OTHER INFORMATION
-------------------------
Item 23. Exhibits
- ------- ----------
(a) Registrant's Amended and Restated Agreement and Declaration of Trust
is incorporated by reference to Exhibit (1) of Post-Effective
Amendment No. 15 to the Registration Statement on Form N-1A, filed on
March 30, 1995, and Exhibit (1)(b) of Post-Effective Amendment No. 20
to the Registration Statement on Form N-1A, filed on March 28, 1997.
(b) Registrant's By-Laws, as amended.
(d) Management Agreement is incorporated by reference to Exhibit (5) of
Post-Effective Amendment No. 15 to the Registration Statement on Form
N-1A, filed on March 30, 1995.
(e) Form of Distribution Agreement and Forms of Service Agreements.
(g) Amended and Restated Custody Agreement is incorporated by reference to
Exhibit 8(a) of Post-Effect Amendment No. 18 to the Registration
Statement on Form N-1A, filed on March 28, 1996. Sub-Custodian
Agreements are incorporated by reference to Exhibit 8(b) of
Post-Effective Amendment No. 14 to the Registration Statement on Form
N-1A, filed on May 19, 1994.
(h) Shareholder Services Plan is incorporated by reference to Exhibit (9)
of Post-Effective Amendment No. 16 to the Registration Statement on
Form N-1A, filed on June 1, 1995.
(i) Opinion and consent of Registrant's counsel is incorporated by
reference to Exhibit (10) of Post-Effective Amendment No. 15 to the
Registration Statement on Form N-1A, filed on March 30, 1995.
(j) Consent of Independent Auditors.
(m) Rule 12b-1 Plan is incorporated by reference to Exhibit (15) of
Post-Effective Amendment No. 16 to the Registration Statement on Form
N-1A, filed on June 1, 1995.
(o) Rule 18f-3 Plan.
(p) Code of Ethics.
<PAGE>
Item 23. Exhibits. - List (continued)
- ------- -----------------------------------------------------
Other Exhibits
--------------
(a) Powers of Attorney.
(b) Certificate of Assistant Secretary.
Item 24. Persons Controlled by or under Common Control with Registrant.
- ------- --------------------------------------------------------------
Not Applicable
Item 25. Indemnification
- ------- ---------------
Reference is made to Article VIII of the Registrant's Amended and
Restated Declaration of Trust incorporated by reference to Exhibit (1)
of Post-Effective Amendment No. 15 to the Registration Statement on
Form N-1A, filed on March 30, 1995. The application of these
provisions is limited by Article 10 of the Registrant's By-Laws, as
amended, filed as Exhibit (b) hereto and by the following undertaking
set forth in the rules promulgated by the Securities and Exchange
Commission:
Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to trustees, officers
and controlling persons of the registrant pursuant to the
foregoing provisions, or otherwise, the registrant has been
advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as
expressed in such Act and is, therefore, unenforceable. In the
event that a claim for indemnification is against such
liabilities (other than the payment by the registrant of
expenses incurred or paid by a trustee, officer or controlling
person of the registrant in the successful defense of any such
action, suit or proceeding) is asserted by such trustee, officer
or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in such Act and will be governed by the final
adjudication of such issue.
Reference is also made to the Form of Distribution Agreement filed as
Exhibit (e) hereto.
Item 26. Business and Other Connections of Investment Adviser.
- ------- ----------------------------------------------------
The Dreyfus Corporation ("Dreyfus") and subsidiary companies
comprise a financial service organization whose business consists
primarily of providing investment management services as the
investment adviser and manager for sponsored investment companies
registered under the Investment Company Act of 1940 and as an
investment adviser to institutional and individual accounts.
Dreyfus also serves as sub-investment adviser to and/or
administrator of other investment companies. Dreyfus Service
Corporation, a wholly-owned subsidiary of Dreyfus, serves
primarily as a registered broker-dealer and distributor of other
investment companies advised and administered by Dreyfus. Dreyfus
Investment Advisors, Inc., another wholly-owned subsidiary,
provides investment management services to various pension plans,
institutions and individuals.
<TABLE>
<CAPTION>
ITEM 26. Business and Other Connections of Investment Adviser (continued)
- ----------------------------------------------------------------------------
Officers and Directors of Investment Adviser
<S> <C> <C> <C>
Name and Position
With Dreyfus Other Businesses Position Held Dates
CHRISTOPHER M. CONDRON Franklin Portfolio Director 1/97 - Present
Chairman of the Board Associates,
and LLC*
Chief Executive
Officer
TBCAM Holdings, Inc.* Director 10/97 - Present
President 10/97 - 6/98
Chairman 10/97 - 6/98
The Boston Company Director 1/98 - Present
Asset Management, LLC* Chairman 1/98 - 6/98
President 1/98 - 6/98
The Boston Company President 9/95 - 1/98
Asset Management, Inc.* Chairman 4/95 - 1/98
Director 4/95 - 1/98
Franklin Portfolio Director 1/97 - Present
Holdings, Inc.*
Certus Asset Advisors Director 6/95 - Present
Corp.**
Mellon Capital Management Director 5/95 - Present
Corporation***
Mellon Bond Associates, Executive Committee 1/98 - Present
LLP+ Member
Mellon Bond Associates+ Trustee 5/95 - 1/98
Mellon Equity Associates, Executive 1/98 - Present
LLP+ Committee
Member
Mellon Equity Associates+ Trustee 5/95 - 1/98
Boston Safe Advisors, Director 5/95 - Present
Inc.* President 5/95 - Present
Mellon Bank, N.A. + Director 1/99 - Present
Chief Operating 3/98 - Present
Officer 3/98 - Present
President 11/94 - 3/98
Vice Chairman
Mellon Financial Chief Operating 1/99 - Present
Corporation+ Officer 1/99 - Present
President 1/98 - Present
Director 11/94 - 1/99
Vice Chairman
Founders Asset Chairman 12/97 - Present
Management, Director 12/97 - Present
LLC****
The Boston Company, Inc.* Vice Chairman 1/94 - Present
Director 5/93 - Present
Laurel Capital Advisors, Executive Committee 1/98 - 8/98
LLP+ Member
CHRISTOPHER M. CONDRON Laurel Capital Advisors+ Trustee 10/93 - 1/98
Chairman and Chief
Executive Officer Boston Safe Deposit and Director 5/93 - Present
(Continued) Trust
Company*
The Boston Company President 6/89 - 1/97
Financial Director 6/89 - 1/97
Strategies, Inc. *
MANDELL L. BERMAN Self-Employed Real Estate 11/74 - Present
Director 29100 Northwestern Highway Consultant,
Suite 370 Residential
Southfield, MI 48034 Builder and
Private Investor
BURTON C. BORGELT DeVlieg Bullard, Inc. Director 1/93 - Present
Director 1 Gorham Island
Westport, CT 06880
Mellon Financial Director 6/91 - Present
Corporation+
Mellon Bank, N.A. + Director 6/91 - Present
Dentsply International, Director 2/81 - Present
Inc.
570 West College Avenue
York, PA
Quill Corporation Director 3/93 - Present
Lincolnshire, IL
STEPHEN R. BYERS Dreyfus Service Senior Vice 3/00 - Present
Director of Corporation++ President
Investments
Gruntal & Co., LLC Executive Vice 5/97 - 11/99
New York, NY President 5/97 - 11/99
Partner 5/97 - 11/99
Executive Committee
Member 5/97 - 11/99
Board of Directors
Member 5/97 - 11/99
Treasurer 5/97 - 6/99
Chief Financial
Officer
STEPHEN E. CANTER Dreyfus Investment Chairman of the 1/97 - Present
President, Chief Advisors, Inc.++ Board 5/95 - Present
Operating Director 5/95 - Present
Officer, Chief President
Investment
Officer, and Director
Newton Management Limited Director 2/99 - Present
London, England
Mellon Bond Associates, Executive 1/99 - Present
LLP+ Committee
Member
Mellon Equity Associates, Executive Committee 1/99 - Present
LLP+ Member
Franklin Portfolio Director 2/99 - Present
Associates,
LLC*
Franklin Portfolio Director 2/99 - Present
Holdings, Inc.*
STEPHEN E. CANTER The Boston Company Asset Director 2/99 - Present
President, Chief Management, LLC*
Operating
Officer, Chief TBCAM Holdings, Inc.* Director 2/99 - Present
Investment
Officer, and Director
(Continued)
Mellon Capital Management Director 1/99 - Present
Corporation***
Founders Asset Management, Member, Board of 12/97 - Present
LLC**** Managers
Acting Chief 7/98 - 12/98
Executive
Officer
The Dreyfus Trust Director 6/95 - Present
Company+++ Chairman 1/99 - Present
President 1/99 - Present
Chief Executive 1/99 - Present
Officer
THOMAS F. EGGERS Dreyfus Service Chief Executive 3/00 - Present
Vice Chairman - Corporation++ Officer
Institutional and Chairman of
And Director the 4/96 - 3/00
Board 9/96 - Present
Executive Vice
President
Director
Founders Asset Management, Member, Board of 2/99 - Present
LLC**** Managers
Dreyfus Investment Director 1/00 - Present
Advisors, Inc.
Dreyfus Service Director 3/99 - Present
Organization,
Inc.++
Dreyfus Insurance Agency Director 3/99 - Present
of
Massachusetts, Inc. +++
Dreyfus Brokerage Director 11/97 - 6/98
Services, Inc.
401 North Maple Avenue
Beverly Hills, CA.
STEVEN G. ELLIOTT Mellon Financial Senior Vice 1/99 - Present
Director Corporation+ Chairman 1/90 - Present
Chief Financial 6/92 - 1/99
Officer 1/90 - 5/98
Vice Chairman
Treasurer
Mellon Bank, N.A.+ Senior Vice 3/98 - Present
Chairman 6/92 - 3/98
Vice Chairman 1/90 - Present
Chief Financial
Officer
Mellon EFT Services Director 10/98 - Present
Corporation
Mellon Bank Center, 8th
Floor
1735 Market Street
Philadelphia, PA 19103
Mellon Financial Services Director 1/96 - Present
Corporation #1 Vice President 1/96 - Present
Mellon Bank Center, 8th
Floor
1735 Market Street
Philadelphia, PA 19103
STEVEN G. ELLIOTT Boston Group Holdings, Vice President 5/93 - Present
Director (Continued) Inc.*
APT Holdings Corporation Treasurer 12/87 - Present
Pike Creek Operations
Center
4500 New Linden Hill Road
Wilmington, DE 19808
Allomon Corporation Director 12/87 - Present
Two Mellon Bank Center
Pittsburgh, PA 15259
Collection Services Controller 10/90 - 2/99
Corporation Director 9/88 - 2/99
500 Grant Street Vice President 9/88 - 2/99
Pittsburgh, PA 15258 Treasurer 9/88 - 2/99
Mellon Financial Company+ Principal Exec. 1/88 - Present
Officer 8/87 - Present
Chief Executive 8/87 - Present
Officer 8/87 - Present
Director
President
Mellon Overseas Director 4/88 - Present
Investments
Corporation+
Mellon Financial Services Treasurer 12/87 - Present
Corporation # 5+
Mellon Financial Markets, Director 1/99 - Present
Inc.+
Mellon Financial Services Director 1/99 - Present
Corporation #17
Fort Lee, NJ
Mellon Mortgage Company Director 1/99 - Present
Houston, TX
Mellon Ventures, Inc. + Director 1/99 - Present
LAWRENCE S. KASH Dreyfus Investment Director 4/97 - 12/99
Vice Chairman Advisors, Inc.++
Dreyfus Brokerage Chairman 11/97 - 2/99
Services, Inc. Chief Executive 11/97 - 2/98
401 North Maple Ave. Officer
Beverly Hills, CA
Dreyfus Service Director 1/95 - 2/99
Corporation++ President 9/96 - 3/99
Dreyfus Precious Metals, Director 3/96 - 12/98
Inc.+++ President 10/96 - 12/98
Dreyfus Service Director 12/94 - 3/99
Organization, Inc.++ President 1/97 - 3/99
Seven Six Seven Agency, Director 1/97 - 4/99
Inc. ++
LAWRENCE S. KASH Dreyfus Insurance Agency Chairman 5/97 - 3/99
Vice Chairman of President 5/97 - 3/99
(Continued) Massachusetts, Inc.++++ Director 5/97 - 3/99
The Dreyfus Trust Chairman 1/97 - 1/99
Company+++ President 2/97 - 1/99
Chief Executive 2/97 - 1/99
Officer 12/94 - Present
Director
The Dreyfus Consumer Chairman 5/97 - 6/99
Credit President 5/97 - 6/99
Corporation++ Director 12/94 - 6/99
Founders Asset Management, Member, Board of 12/97 - 12/99
LLC**** Managers
The Boston Company Chairman 12/95 - 1/99
Advisors, Chief Executive 12/95 - 1/99
Inc. Officer 12/95 - 1/99
Wilmington, DE President
The Boston Company, Inc.* Director 5/93 - 1/99
President 5/93 - 1/99
Mellon Bank, N.A.+ Executive Vice 6/92 - Present
President
Laurel Capital Advisors, Chairman 1/98 - 8/98
LLP+ Executive Committee 1/98 - 8/98
Member
Chief Executive 1/98 - 8/98
Officer 1/98 - 8/98
President
Laurel Capital Advisors, Trustee 12/91 - 1/98
Inc. + Chairman 9/93 - 1/98
President and CEO 12/91 - 1/98
Boston Group Holdings, Director 5/93 - Present
Inc.* President 5/93 - Present
Boston Safe Deposit & Director 6/93 - 1/99
Trust Co.+ Executive Vice 6/93 - 4/98
President
MARTIN G. MCGUINN Mellon Financial Chairman 1/99 - Present
Director Corporation+ Chief Executive 1/99 - Present
Officer 1/98 - Present
Director 1/90 - 1/99
Vice Chairman
Mellon Bank, N. A. + Chairman 3/98 - Present
Chief Executive 3/98 - Present
Officer 1/98 - Present
Director 1/90 - 3/98
Vice Chairman
Mellon Leasing Vice Chairman 12/96 - Present
Corporation+
Mellon Bank (DE) National Director 4/89 - 12/98
Association
Wilmington, DE
MARTIN G. MCGUINN Mellon Bank (MD) National Director 1/96 - 4/98
Director Association
(Continued) Rockville, Maryland
J. DAVID OFFICER Dreyfus Service President 3/00 - Present
Vice Chairman Corporation++ Executive Vice 5/98 - 3/00
And Director President 3/99 - Present
Director
Dreyfus Service Director 3/99 - Present
Organization,
Inc.++
Dreyfus Insurance Agency Director 5/98 - Present
of
Massachusetts, Inc.++++
Dreyfus Brokerage Chairman 3/99 - Present
Services, Inc.
401 North Maple Avenue
Beverly Hills, CA
Seven Six Seven Agency, Director 10/98 - Present
Inc.++
Mellon Residential Director 4/97 - Present
Funding Corp. +
Mellon Trust of Florida, Director 8/97 - Present
N.A.
2875 Northeast 191st
Street
North Miami Beach, FL
33180
Mellon Bank, NA+ Executive Vice 7/96 - Present
President
The Boston Company, Inc.* Vice Chairman 1/97 - Present
Director 7/96 - Present
Mellon Preferred Capital Director 11/96 - 1/99
Corporation*
RECO, Inc.* President 11/96 - Present
Director 11/96 - Present
The Boston Company President 8/96 - 6/99
Financial Director 8/96 - 6/99
Services, Inc.*
Boston Safe Deposit and Director 7/96 - Present
Trust President 7/96 - 1/99
Company*
Mellon Trust of New York Director 6/96 - Present
1301 Avenue of the
Americas
New York, NY 10019
Mellon Trust of California Director 6/96 - Present
400 South Hope Street
Suite 400
Los Angeles, CA 90071
Mellon United National Director 3/98 - Present
Bank
1399 SW 1st Ave., Suite
400
Miami, Florida
Boston Group Holdings, Director 12/97 - Present
Inc.*
J. DAVID OFFICER Dreyfus Financial Director 9/96 - Present
Vice Chairman and Services Corp. +
Director (Continued)
Dreyfus Investment Director 4/96 - Present
Services
Corporation+
RICHARD W. SABO Founders Asset Management President 12/98 - Present
Director LLC**** Chief Executive 12/98 - Present
Officer
Prudential Securities Senior Vice 07/91 - 11/98
New York, NY President 07/91 - 11/98
Regional Director
RICHARD F. SYRON Thermo Electron President 6/99 - Present
Director 81 Wyman Street Chief Executive 6/99 - Present
Waltham, MA 02454-9046 Officer
American Stock Exchange Chairman 4/94 - 6/99
86 Trinity Place Chief Executive 4/94 - 6/99
New York, NY 10006 Officer
RONALD P. O'HANLEY Franklin Portfolio Director 3/97 - Present
Vice Chairman Holdings, Inc.*
Franklin Portfolio Director 3/97 - Present
Associates,
LLC*
Boston Safe Deposit and Executive Committee 1/99 - Present
Trust Member
Company* Director 1/99 - Present
The Boston Company, Inc.* Executive Committee 1/99 - Present
Member 1/99 - Present
Director
Buck Consultants, Inc.++ Director 7/97 - Present
Newton Asset Management Executive 10/98 - Present
LTD Committee
(UK) Member 10/98 - Present
London, England Director
Mellon Asset Management Non-Resident 11/98 - Present
(Japan) Co., LTD Director
Tokyo, Japan
TBCAM Holdings, Inc.* Director 10/97 - Present
The Boston Company Asset Director 1/98 - Present
Management, LLC*
Boston Safe Advisors, Chairman 6/97 - Present
INC.* Director 2/97 - Present
Pareto Partners Partner 5/97 - Present
271 Regent Street Representative
London, England W1R 8PP
RONALD P. O'HANLEY Mellon Capital Management Director 2/97 -Present
Vice Chairman Corporation***
(Continued)
Certus Asset Advisors Director 2/97 - Present
Corp.**
Mellon Bond Associates; Trustee 1/98 - Present
LLP+ Chairman 1/98 - Present
Mellon Equity Associates; Trustee 1/98 - Present
LLP+ Chairman 1/98 - Present
Mellon-France Corporation+ Director 3/97 - Present
Laurel Capital Advisors+ Trustee 3/97 - Present
MARK N. JACOBS Dreyfus Investment Director 4/97 - Present
General Counsel, Advisors, Inc.++ Secretary 10/77 - 7/98
Vice President, and
Secretary The Dreyfus Trust Director 3/96 - Present
Company+++
The TruePenny President 10/98 - Present
Corporation++ Director 3/96 - Present
Dreyfus Service Director 3/97 - 3/99
Organization, Inc.++
WILLIAM H. MARESCA The Dreyfus Trust Chief Financial 3/99 - Present
Controller Company+++ Officer 9/98 - Present
Treasurer 3/97 - Present
Director
Dreyfus Service Chief Financial 12/98 - Present
Corporation++ Officer
Dreyfus Consumer Credit Treasurer 10/98 - Present
Corp. ++
Dreyfus Investment Treasurer 10/98 - Present
Advisors, Inc. ++
Dreyfus-Lincoln, Inc. Vice President 10/98 - Present
4500 New Linden Hill Road
Wilmington, DE 19808
The TruePenny Vice President 10/98 - Present
Corporation++
Dreyfus Precious Metals, Treasurer 10/98 - 12/98
Inc. +++
The Trotwood Corporation++ Vice President 10/98 - Present
Trotwood Hunters Vice President 10/98 - Present
Corporation++
Trotwood Hunters Site A Vice President 10/98 - Present
Corp. ++
Dreyfus Transfer, Inc. Chief Financial 5/98 - Present
One American Express Officer
Plaza,
Providence, RI 02903
Dreyfus Service Treasurer 3/99 - Present
Organization, Inc.++ Assistant 3/93 - 3/99
Treasurer
WILLIAM H. MARESCA Dreyfus Insurance Agency Assistant Treasurer 5/98 - Present
Controller of
(Continued) Massachusetts, Inc.++++
WILLIAM T. SANDALLS, Dreyfus Transfer, Inc. Chairman 2/97 - Present
JR. One American Express
Executive Vice Plaza,
President Providence, RI 02903
Dreyfus Service Director 1/96 - Present
Corporation++ Executive Vice 2/97 - Present
President 2/97 - 12/98
Chief Financial
Officer
Dreyfus Investment Director 1/96 - Present
Advisors, Inc.++ Treasurer 1/96 - 10/98
Dreyfus-Lincoln, Inc. Director 12/96 - Present
4500 New Linden Hill Road President 1/97 - Present
Wilmington, DE 19808
Seven Six Seven Agency, Director 1/96 - 10/98
Inc.++ Treasurer 10/96 - 10/98
The Dreyfus Consumer Director 1/96 - Present
Credit Corp.++ Vice President 1/96 - Present
Treasurer 1/97 - 10/98
The Dreyfus Trust Company Director 1/96 - Present
+++
Dreyfus Service Treasurer 10/96 - 3/99
Organization,
Inc.++
Dreyfus Insurance Agency Director 5/97 - 3/99
of Treasurer 5/97 - 3/99
Massachusetts, Inc.++++ Executive Vice 5/97 - 3/99
President
DIANE P. DURNIN Dreyfus Service Senior Vice 5/95 - 3/99
Vice President - Corporation++ President -
Product Marketing and
Development Advertising
Division
PATRICE M. KOZLOWSKI NONE
Vice President -
Corporate
Communications
MARY BETH LEIBIG NONE
Vice President -
Human Resources
THEODORE A. SCHACHAR Dreyfus Service Vice President -Tax 10/96 - Present
Vice President - Tax Corporation++
The Dreyfus Consumer Chairman 6/99 - Present
Credit President 6/99 - Present
Corporation ++
Dreyfus Investment Vice President - 10/96 - Present
Advisors, Tax
Inc.++
Dreyfus Precious Metals, Vice President - 10/96 - 12/98
Inc. +++ Tax
THEODORE A. SCHACHAR Dreyfus Service Vice President - 10/96 - Present
Vice President - Tax Organization, Tax
(Continued) Inc.++
WENDY STRUTT None
Vice President
RICHARD TERRES None
Vice President
RAYMOND J. VAN COTT Mellon Financial Vice President 7/98 - Present
Vice-President - Corporation+
Information Systems
Computer Sciences Vice President 1/96 - 7/98
Corporation
El Segundo, CA
JAMES BITETTO The TruePenny Secretary 9/98 - Present
ASSISTANT SECRETARY Corporation++
Dreyfus Service Assistant Secretary 8/98 - Present
Corporation++
Dreyfus Investment Assistant Secretary 7/98 - Present
Advisors, Inc.++
Dreyfus Service Assistant Secretary 7/98 - Present
Organization, Inc.++
STEVEN F. NEWMAN Dreyfus Transfer, Inc. Vice President 2/97 - Present
Assistant Secretary One American Express Plaza Director 2/97 - Present
Providence, RI 02903 Secretary 2/97 - Present
Dreyfus Service Secretary 7/98 - Present
Organization, Inc.++ Assistant Secretary 5/98 - 7/98
* The address of the business so indicated is One Boston Place, Boston,
Massachusetts, 02108.
** The address of the business so indicated is One Bush Street, Suite 450,
San Francisco, California 94104.
*** The address of the business so indicated is 595 Market Street, Suite 3000,
San Francisco, California 94105.
**** The address of the business so indicated is 2930 East Third Avenue,
Denver, Colorado 80206.
+ The address of the business so indicated is One Mellon Bank Center,
Pittsburgh, Pennsylvania 15258.
++ The address of the business so indicated is 200 Park Avenue, New York, New
York 10166.
+++ The address of the business so indicated is 144 Glenn Curtiss Boulevard,
Uniondale, New York 11556-0144.
++++ The address of the business so indicated is 53 State Street, Boston,
Massachusetts 02109.
</TABLE>
Item 27. Principal Underwriters
- -------- ----------------------
(a) Other investment companies for which Registrant's principal underwriter
(exclusive distributor) acts as principal underwriter or exclusive distributor:
1) Dreyfus A Bonds Plus, Inc.
2) Dreyfus Appreciation Fund, Inc.
3) Dreyfus Balanced Fund, Inc.
4) Dreyfus BASIC GNMA Fund
5) Dreyfus BASIC Money Market Fund, Inc.
6) Dreyfus BASIC Municipal Fund, Inc.
7) Dreyfus BASIC U.S. Government Money Market Fund
8) Dreyfus California Intermediate Municipal Bond Fund
9) Dreyfus California Tax Exempt Bond Fund, Inc.
10) Dreyfus California Tax Exempt Money Market Fund
11) Dreyfus Cash Management
12) Dreyfus Cash Management Plus, Inc.
13) Dreyfus Connecticut Intermediate Municipal Bond Fund
14) Dreyfus Connecticut Municipal Money Market Fund, Inc.
15) Dreyfus Florida Intermediate Municipal Bond Fund
16) Dreyfus Florida Municipal Money Market Fund
17) Dreyfus Founders Funds, Inc.
18) The Dreyfus Fund Incorporated
19) Dreyfus Global Bond Fund, Inc.
20) Dreyfus Global Growth Fund
21) Dreyfus GNMA Fund, Inc.
22) Dreyfus Government Cash Management Funds
23) Dreyfus Growth and Income Fund, Inc.
24) Dreyfus Growth and Value Funds, Inc.
25) Dreyfus Growth Opportunity Fund, Inc.
26) Dreyfus Debt and Equity Funds
27) Dreyfus Index Funds, Inc.
28) Dreyfus Institutional Money Market Fund
29) Dreyfus Institutional Preferred Money Market Fund
30) Dreyfus Institutional Short Term Treasury Fund
31) Dreyfus Insured Municipal Bond Fund, Inc.
32) Dreyfus Intermediate Municipal Bond Fund, Inc.
33) Dreyfus International Funds, Inc.
34) Dreyfus Investment Grade Bond Funds, Inc.
35) Dreyfus Investment Portfolios
36) The Dreyfus/Laurel Funds, Inc.
37) The Dreyfus/Laurel Funds Trust
38) The Dreyfus/Laurel Tax-Free Municipal Funds
39) Dreyfus LifeTime Portfolios, Inc.
40) Dreyfus Liquid Assets, Inc.
41) Dreyfus Massachusetts Intermediate Municipal Bond Fund
42) Dreyfus Massachusetts Municipal Money Market Fund
43) Dreyfus Massachusetts Tax Exempt Bond Fund
44) Dreyfus MidCap Index Fund
45) Dreyfus Money Market Instruments, Inc.
46) Dreyfus Municipal Bond Fund, Inc.
47) Dreyfus Municipal Cash Management Plus
48) Dreyfus Municipal Money Market Fund, Inc.
49) Dreyfus New Jersey Intermediate Municipal Bond Fund
50) Dreyfus New Jersey Municipal Bond Fund, Inc.
51) Dreyfus New Jersey Municipal Money Market Fund, Inc.
52) Dreyfus New Leaders Fund, Inc.
53) Dreyfus New York Municipal Cash Management
54) Dreyfus New York Tax Exempt Bond Fund, Inc.
55) Dreyfus New York Tax Exempt Intermediate Bond Fund
56) Dreyfus New York Tax Exempt Money Market Fund
57) Dreyfus U.S. Treasury Intermediate Term Fund
58) Dreyfus U.S. Treasury Long Term Fund
59) Dreyfus 100% U.S. Treasury Money Market Fund
60) Dreyfus U.S. Treasury Short Term Fund
61) Dreyfus Pennsylvania Intermediate Municipal Bond Fund
62) Dreyfus Pennsylvania Municipal Money Market Fund
63) Dreyfus Premier California Municipal Bond Fund
64) Dreyfus Premier Equity Funds, Inc.
65) Dreyfus Premier International Funds, Inc.
66) Dreyfus Premier GNMA Fund
67) Dreyfus Premier Worldwide Growth Fund, Inc.
68) Dreyfus Premier Municipal Bond Fund
69) Dreyfus Premier New York Municipal Bond Fund
70) Dreyfus Premier State Municipal Bond Fund
71) Dreyfus Premier Value Equity Funds
72) Dreyfus Short-Intermediate Government Fund
73) Dreyfus Short-Intermediate Municipal Bond Fund
74) The Dreyfus Socially Responsible Growth Fund, Inc.
75) Dreyfus Stock Index Fund
76) Dreyfus Tax Exempt Cash Management
77) The Dreyfus Premier Third Century Fund, Inc.
78) Dreyfus Treasury Cash Management
79) Dreyfus Treasury Prime Cash Management
80) Dreyfus Variable Investment Fund
81) Dreyfus Worldwide Dollar Money Market Fund, Inc.
82) General California Municipal Bond Fund, Inc.
83) General California Municipal Money Market Fund
84) General Government Securities Money Market Funds, Inc.
85) General Money Market Fund, Inc.
86) General Municipal Bond Fund, Inc.
87) General Municipal Money Market Funds, Inc.
88) General New York Municipal Bond Fund, Inc.
89) General New York Municipal Money Market Fund
<TABLE>
<CAPTION>
Positions and
Name and principal Offices with
Business address Positions and offices with the Distributor Registrant
- ---------------- ------------------------------------------ ----------
<S> <C> <C>
Thomas F. Eggers * Chief Executive Officer and Chairman of the None
Board
J. David Officer * President and Director None
Stephen Burke * Executive Vice President None
Charles Cardona * Executive Vice President None
Anthony DeVivio ** Executive Vice President None
David K. Mossman ** Executive Vice President None
Jeffrey N. Nachman *** Executive Vice President and Chief Operations None
Officer
William T. Sandalls, Jr. * Executive Vice President and Director None
Wilson Santos ** Executive Vice President and Director of None
Client Services
William H. Maresca * Chief Financial Officer None
Ken Bradle ** Senior Vice President None
Stephen R. Byers * Senior Vice President None
Frank J. Coates * Senior Vice President None
Joseph Connolly * Senior Vice President Vice President
and Treasurer
William Glenn * Senior Vice President None
Michael Millard ** Senior Vice President None
Mary Jean Mulligan ** Senior Vice President None
Bradley Skapyak * Senior Vice President None
Jane Knight * Chief Legal Officer and Secretary None
Stephen Storen * Chief Compliance Officer None
Jeffrey Cannizzaro * Vice President - Compliance None
Maria Georgopoulos * Vice President - Facilities Management None
William Germenis Vice President - Compliance None
Walter T. Harris * Vice President None
Janice Hayles * Vice President None
Hal Marshall * Vice President - Compliance None
Paul Molloy * Vice President None
Theodore A. Schachar * Vice President - Tax None
James Windels * Vice President None
James Bitetto * Assistant Secretary None
* Principal business address is 200 Park Avenue, New York, NY 10166.
** Principal business address is 144 Glenn Curtiss Blvd., Uniondale, NY
11556-0144.
*** Principal business address is 401 North Maple Avenue, Beverly Hills,
CA 90210.
</TABLE>
<PAGE>
Item 28. Location of Accounts and Records
- ------- --------------------------------
1. The Bank of New York
100 Church Street
New York, New York 10007
2. Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, Rhode Island 02940-9671
3. The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Item 29. Management Services
- ------- -------------------
Not Applicable
Item 30. Undertakings
- ------- ------------
None
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the
Investment Company Act of 1940, the Registrant certifies that it meets all of
the requirements for effectiveness of this Registration Statement under Rule
485(b) under the Securities Act of 1933 and has duly caused this Amendment to
the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, and State of New York on the
24th day of May, 2000.
DREYFUS PREMIER CALIFORNIA MUNICIPAL BOND FUND
BY: /s/Stephen E. Canter*
---------------------
STEPHEN E. CANTER, PRESIDENT
Pursuant to the requirements of the Securities Act of 1933, this Amendment
to the Registration Statement has been signed below by the following persons in
the capacities and on the date indicated.
Signatures Title Date
/s/ Stephen E. Canter * President (Principal Executive 05/24/00
- ------------------------------ Officer)
Stephen E. Canter
/s/Joseph Connolly* Treasurer (Principal Accounting 05/24/00
- ------------------------------ and Financial Officer)
Joseph Connolly
/s/Joseph S. DiMartino* Chairman of the Board 05/24/00
- ------------------------------
Joseph S. DiMartino
/s/Clifford L. Alexander, Jr* Board member 05/24/00
- ------------------------------
Clifford L. Alexander, Jr.
/s/Peggy C. Davis* Board member 05/24/00
- ------------------------------
Peggy C. Davis
/s/Ernest Kafka* Board member 05/24/00
- -----------------------------
Ernest Kafka
/s/Nathan Leventhal* Board member 05/24/00
- ------------------------
Nathan Leventhal
*BY: /s/Janette E. Farragher
-------------------------
Janette E. Farragher,
Attorney-in-Fact
DREYFUS PREMIER CALIFORNIA MUNICIPAL BOND FUND
INDEX OF EXHIBITS
-------------------------
ITEM PAGE
- ----- ------
(23) Exhibits:
(b) By-Laws, as amended
(e) Form of Distribution Agreement and
Forms of Service Agreements
(j) Consent of Independent Auditors
(o) Rule 18f-3 Plan
(p) Code of Ethics
Other Exhibits
(a) Powers of Attorney
(b) Certificate of Assistant Secretary
BY-LAWS
OF
DREYFUS PREMIER CALIFORNIA MUNICIPAL BOND FUND
ARTICLE 1
Agreement and Declaration of Trust and Principal Office
1.1. Agreement and Declaration of Trust. These By-Laws shall be
subject to the Agreement and Declaration of Trust, as from time to time in
effect (the "Declaration of Trust"), of the above-captioned Massachusetts
business trust established by the Declaration of Trust (the "Trust").
1.2. Principal Office of the Trust. The principal office of the
Trust shall be located in New York, New York. Its resident agent in
Massachusetts shall be CT Corporation System, 2 Oliver Street, Boston,
Massachusetts 02109, or such other person as the Trustees from time to time may
select.
ARTICLE 2
Meetings of Trustees
2.1. Regular Meetings. Regular meetings of the Trustees may be held
without call or notice at such places and at such times as the Trustees from
time to time may determine, provided that notice of the first regular meeting
following any such determination shall be given to absent Trustees.
2.2. Special Meetings. Special meetings of the Trustees may be held
at any time and at any place designated in the call of the meeting when called
by the President or the Treasurer or by two or more Trustees, sufficient notice
thereof being given to each Trustee by the Secretary or an Assistant Secretary
or by the officer or the Trustees calling the meeting.
2.3. Notice of Special Meetings. It shall be sufficient notice to a
Trustee of a special meeting to send notice by mail at least forty-eight hours
or by telegram at least twenty-four hours before the meeting addressed to the
Trustee at his or her usual or last known business or residence address or to
give notice to him or her in person or by telephone at least twenty-four hours
before the meeting. Notice of a meeting need not be given to any Trustee if a
written waiver of notice, executed by him or her before or after the meeting, is
filed with the records of the meeting, or to any Trustee who attends the meeting
without protesting prior thereto or at its commencement the lack of notice to
him or her. Neither notice of a meeting nor a waiver of a notice need specify
the purposes of the meeting.
2.4. Notice of Certain Actions by Consent. If in accordance with the
provisions of the Declaration of Trust any action is taken by the Trustees by a
written consent of less than all of the Trustees, then prompt notice of any such
action shall be furnished to each Trustee who did not execute such written
consent, provided that the effectiveness of such action shall not be impaired by
any delay or failure to furnish such notice.
ARTICLE 3
Officers
3.1. Enumeration; Qualification. The officers of the Trust shall be a
President, a Treasurer, a Secretary, and such other officers, if any, as the
Trustees from time to time may in their discretion elect. The Trust also may
have such agents as the Trustees from time to time may in their discretion
appoint. An officer may be but need not be a Trustee or shareholder. Any two or
more offices may be held by the same person.
3.2. Election. The President, the Treasurer and the Secretary shall be
elected by the Trustees upon the occurrence of any vacancy in any such office.
Other officers, if any, may be elected or appointed by the Trustees at any time.
Vacancies in any such other office may be filled at any time.
3.3. Tenure. The President, Treasurer and Secretary shall hold office in
each case until he or she sooner dies, resigns, is removed or becomes
disqualified. Each other officer shall hold office and each agent shall retain
authority at the pleasure of the Trustees.
3.4. Powers. Subject to the other provisions of these By-Laws, each officer
shall have, in addition to the duties and powers herein and in the Declaration
of Trust set forth, such duties and powers as commonly are incident to the
office occupied by him or her as if the Trust were organized as a Massachusetts
business corporation or such other duties and powers as the Trustees may from
time to time designate.
3.5. President. Unless the Trustees otherwise provide, the President shall
preside at all meetings of the shareholders and of the Trustees. Unless the
Trustees otherwise provide, the President shall be the chief executive officer.
3.6. Treasurer. The Treasurer shall be the chief financial and accounting
officer of the Trust, and, subject to the provisions of the Declaration of Trust
and to any arrangement made by the Trustees with a custodian, investment adviser
or manager, or transfer, shareholder servicing or similar agent, shall be in
charge of the valuable papers, books of account and accounting records of the
Trust, and shall have such other duties and powers as may be designated from
time to time by the Trustees or by the President.
3.7. Secretary. The Secretary shall record all proceedings of the
shareholders and the Trustees in books to be kept therefor, which books or a
copy thereof shall be kept at the principal office of the Trust. In the absence
of the Secretary from any meeting of the shareholders or Trustees, an Assistant
Secretary, or if there be none or if he or she is absent, a temporary Secretary
chosen at such meeting shall record the proceedings thereof in the aforesaid
books.
3.8. Resignations and Removals. Any Trustee or officer may resign at any
time by written instrument signed by him or her and delivered to the President
or Secretary or to a meeting of the Trustees. Such resignation shall be
effective upon receipt unless specified to be effective at some other time. The
Trustees may remove any officer elected by them with or without cause. Except to
the extent expressly provided in a written agreement with the Trust, no Trustee
or officer resigning and no officer removed shall have any right to any
compensation for any period following his or her resignation or removal, or any
right to damages on account of such removal.
ARTICLE 4
Committees
4.1. Appointment. The Trustees may appoint from their number an executive
committee and other committees. Except as the Trustees otherwise may determine,
any such committee may make rules for conduct of its business.
4.2. Quorum; Voting. A majority of the members of any Committee of the
Trustees shall constitute a quorum for the transaction of business, and any
action of such a Committee may be taken at a meeting by a vote of a majority of
the members present (a quorum being present).
ARTICLE 5
Reports
The Trustees and officers shall render reports at the time and in the
manner required by the Declaration of Trust or any applicable law. Officers and
Committees shall render such additional reports as they may deem desirable or as
may from time to time be required by the Trustees.
ARTICLE 6
Fiscal Year
The fiscal year of the Trust shall be fixed, and shall be subject to
change, by the Board of Trustees.
ARTICLE 7
Seal
The seal of the Trust shall consist of a flat-faced die with the word
"Massachusetts," together with the name of the Trust and the year of its
organization cut or engraved thereon but, unless otherwise required by the
Trustees, the seal shall not be necessary to be placed on, and in its absence
shall not impair the validity of, any document, instrument or other paper
executed and delivered by or on behalf of the Trust.
ARTICLE 8
Execution of Papers
Except as the Trustees generally or in particular cases may authorize the
execution thereof in some other manner, all deeds, leases, contracts, notes and
other obligations made by the Trustees shall be signed by the President, any
Vice President, or by the Treasurer and need not bear the seal of the Trust.
ARTICLE 9
Issuance of Share Certificates
9.1. Sale of Shares. Except as otherwise determined by the Trustees, the
Trust will issue and sell for cash or securities from time to time, full and
fractional shares of its shares of beneficial interest, such shares to be issued
and sold at a price of not less than net asset value per share, as from time to
time determined in accordance with the Declaration of Trust and these By-Laws
and, in the case of fractional shares, at a proportionate reduction in such
price. In the case of shares sold for securities, such securities shall be
valued in accordance with the provisions for determining value of assets of the
Trust as stated in the Declaration of Trust and these By-Laws. The officers of
the Trust are severally authorized to take all such actions as may be necessary
or desirable to carry out this Section 9.1.
9.2. Share Certificates. In lieu of issuing certificates for shares, the
Trustees or the transfer agent either may issue receipts therefor or may keep
accounts upon the books of the Trust for the record holders of such shares, who
shall in either case, for all purposes hereunder, be deemed to be the holders of
certificates for such shares as if they had accepted such certificates and shall
be held to have expressly assented and agreed to the terms hereof.
The Trustees at any time may authorize the issuance of share certificates.
In that event, each shareholder shall be entitled to a certificate stating the
number of shares owned by him or her, in such form as shall be prescribed from
time to time by the Trustees. Such certificate shall be signed by the President
or Vice President and by the Treasurer or Assistant Treasurer. Such signatures
may be facsimile if the certificate is signed by a transfer agent, or by a
registrar, other than a Trustee, officer or employee of the Trust. In case any
officer who has signed or whose facsimile signature has been placed on such
certificate shall cease to be such officer before such certificate is issued, it
may be issued by the Trust with the same effect as if he or she were such
officer at the time of its issue.
9.3. Loss of Certificates. The Trust, or if any transfer agent is appointed
for the Trust, the transfer agent with the approval of any two officers of the
Trust, is authorized to issue and countersign replacement certificates for the
shares of the Trust which have been lost, stolen or destroyed subject to the
deposit of a bond or other indemnity in such form and with such security, if
any, as the Trustees may require.
9.4. Discontinuance of Issuance of Certificates. The Trustees at any time
may discontinue the issuance of share certificates and by written notice to each
shareholder, may require the surrender of share certificates to the Trust for
cancellation. Such surrender and cancellation shall not affect the ownership of
shares in the Trust.
ARTICLE 10
Indemnification
10.1. Trustees, Officers, etc. The Trust shall indemnify each of its
Trustees and officers (including persons who serve at the Trust's request as
directors, officers or trustees of another organization in which the Trust has
any interest as a shareholder, creditor or otherwise) (hereinafter referred to
as a "Covered Person") against all liabilities and expenses, including but not
limited to amounts paid in satisfaction of judgments, in compromise or as fines
and penalties, and counsel fees reasonably incurred by any Covered Person in
connection with the defense or disposition of any action, suit or other
proceeding, whether civil or criminal, before any court or administrative or
legislative body, in which such Covered Person may be or may have been involved
as a party or otherwise or with which such person may be or may have been
threatened, while in office or thereafter, by reason of being or having been
such a Trustee or officer, except with respect to any matter as to which such
Covered Person shall have been finally adjudicated in a decision on the merits
in any such action, suit or other proceeding not to have acted in good faith in
the reasonable belief that such Covered Person's action was in the best
interests of the Trust and except that no Covered Person shall be indemnified
against any liability to the Trust or its Shareholders to which such Covered
Person would otherwise be subject by reason of willful misfeasance, bad faith,
gross negligence or reckless disregard of the duties involved in the conduct of
such Covered Person's office. Expenses, including counsel fees so incurred by
any such Covered Person (but excluding amounts paid in satisfaction of
judgments, in compromise or as fines or penalties), may be paid from time to
time by the Trust in advance of the final disposition or any such action, suit
or proceeding upon receipt of an undertaking by or on behalf of such Covered
Person to repay amounts so paid to the Trust if it is ultimately determined that
indemnification of such expenses is not authorized under this Article, provided
that (a) such Covered Person shall provide security for his or her undertaking,
(b) the Trust shall be insured against losses arising by reason of such Covered
Person's failure to fulfill his or her undertaking, or (c) a majority of the
Trustees who are disinterested persons and who are not Interested Persons (as
that term is defined in the Investment Company Act of 1940) (provided that a
majority of such Trustees then in office act on the matter), or independent
legal counsel in a written opinion, shall determine, based on a review of
readily available facts (but not a full trial-type inquiry), that there is
reason to believe such Covered Person ultimately will be entitled to
indemnification.
10.2. Compromise Payment. As to any matter disposed of (whether by a
compromise payment, pursuant to a consent decree or otherwise) without an
adjudication in a decision on the merits by a court, or by any other body before
which the proceeding was brought, that such Covered Person either (a) did not
act in good faith in the reasonable belief that such Covered Person's action was
in the best interests of the Trust or (b) is liable to the Trust or its
Shareholders by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of such Covered
Person's office, indemnification shall be provided if (a) approved as in the
best interest of the Trust, after notice that it involves such indemnification,
by at least a majority of the Trustees who are disinterested persons and are not
Interested Persons (provided that a majority of such Trustees then in office act
on the matter), upon a determination, based upon a review of readily available
facts (but not a full trial-type inquiry) that such Covered Person acted in good
faith in the reasonable belief that such Covered Person's action was in the best
interests of the Trust and is not liable to the Trust or its Shareholders by
reason of willful misfeasance, bad faith, gross negligence or reckless disregard
of the duties involved in the conduct of such Covered Person's office, or (b)
there has been obtained an opinion in writing of independent legal counsel,
based upon a review of readily available facts (but not a full trial-type
inquiry) to the effect that such Covered Person appears to have acted in good
faith in the reasonable belief that such Covered Person's action was in the best
interests of the Trust and that such indemnification would not protect such
Covered Person against any liability to the Trust to which such Covered Person
would otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office. Any approval pursuant to this Section shall not prevent the recovery
from any Covered Person of any amount paid to such Covered Person in accordance
with this Section as indemnification if such Covered Person is subsequently
adjudicated by a court of competent jurisdiction not to have acted in good faith
in the reasonable belief that such Covered Person's action was in the best
interests of the Trust or to have been liable to the Trust or its shareholders
by reason of willful misfeasance, bad faith, gross negligence or reckless
disregard of the duties involved in the conduct of such Covered Person's office.
10.3. Indemnification Not Exclusive. The right of indemnification hereby
provided shall not be exclusive of or affect any other rights to which any such
Covered Person may be entitled. As used in this Article 10, the term "Covered
Person" shall include such person's heirs, executors and administrators, and a
"disinterested person" is a person against whom none of the actions, suits or
other proceedings in question or another action, suit, or other proceeding on
the same or similar grounds is then or has been pending. Nothing contained in
this Article shall affect any rights to indemnification to which personnel of
the Trust, other than Trustees and officers, and other persons may be entitled
by contract or otherwise under law, nor the power of the Trust to purchase and
maintain liability insurance on behalf of such person.
10.4. Limitation. Notwithstanding any provisions in the Declaration of
Trust and these By-Laws pertaining to indemnification, all such provisions are
limited by the following undertaking set forth in the rules promulgated by the
Securities and Exchange Commission:
In the event that a claim for indemnification is asserted by a
Trustee, officer or controlling person of the Trust in connection
with the registered securities of the Trust, the Trust will not make
such indemnification unless (i) the Trust has submitted, before a
court or other body, the question of whether the person to be
indemnified was liable by reason of willful misfeasance, bad faith,
gross negligence, or reckless disregard of duties, and has obtained
a final decision on the merits that such person was not liable by
reason of such conduct or (ii) in the absence of such decision, the
Trust shall have obtained a reasonable determination, based upon a
review of the facts, that such person was not liable by virtue of
such conduct, by (a) the vote of a majority of Trustees who are
neither interested persons as such term is defined in the Investment
Company Act of 1940, nor parties to the proceeding or (b) an
independent legal counsel in a written opinion.
The Trust will not advance attorneys' fees or other expenses
incurred by the person to be indemnified unless (i) the Trust shall
have received an undertaking by or on behalf of such person to repay
the advance unless it is ultimately determined that such person is
entitled to indemnification and (ii) one of the following conditions
shall have occurred: (x) such person shall provide security for his
undertaking, (y) the Trust shall be insured against losses arising
by reason of any lawful advances or (z) a majority of the
disinterested, non-party Trustees of the Trust, or an independent
legal counsel in a written opinion, shall have determined that based
on a review of readily available facts there is reason to believe
that such person ultimately will be found entitled to
indemnification.
ARTICLE 11
Shareholders
11.1. Meetings. A meeting of the shareholders shall be called by the
Secretary whenever ordered by the Trustees, or requested in writing by the
holder or holders of at least 10% of the outstanding shares entitled to vote at
such meeting. If the meeting is a meeting of the shareholders of one or more
series or class of shares, but not a meeting of all shareholders of the Trust,
then only the shareholders of such one or more series or classes shall be
entitled to notice of and to vote at the meeting. If the Secretary, when so
ordered or requested, refuses or neglects for more than five days to call such
meeting, the Trustees, or the shareholders so requesting may, in the name of the
Secretary, call the meeting by giving notice thereof in the manner required when
notice is given by the Secretary.
11.2. Access to Shareholder List. Shareholders of record may apply to the
Trustees for assistance in communicating with other shareholders for the purpose
of calling a meeting in order to vote upon the question of removal of a Trustee.
When ten or more shareholders of record who have been such for at least six
months preceding the date of application and who hold in the aggregate shares
having a net asset value of at least $25,000 or at least 1% of the outstanding
shares, whichever is less, so apply, the Trustees shall within five business
days either:
(i) afford to such applicants access to a list of names and addresses of
all shareholders as recorded on the books of the Trust; or
(ii) inform such applicants of the approximate number of shareholders of
record and the approximate cost of mailing material to them and, within a
reasonable time thereafter, mail materials submitted by the applicants to all
such shareholders of record. The Trustees shall not be obligated to mail
materials which they believe to be misleading or in violation of applicable law.
11.3. Record Dates. For the purpose of determining the shareholders of any
series or class who are entitled to vote or act at any meeting or any
adjournment thereof, or who are entitled to receive payment of any dividend or
of any other distribution, the Trustees from time to time may fix a time, which
shall be not more than 90 days before the date of any meeting of shareholders or
the date of payment of any dividend or of any other distribution, as the record
date for determining the shareholders of such series or class having the right
to notice of and to vote at such meeting and any adjournment thereof or the
right to receive such dividend or distribution, and in such case only
shareholders of record on such record date shall have such right notwithstanding
any transfer of shares on the books of the Trust after the record date; or
without fixing such record date the Trustees may for any such purposes close the
register or transfer books for all or part of such period.
11.4. Place of Meetings. All meetings of the shareholders shall be held at
the principal office of the Trust or at such other place within the United
States as shall be designated by the Trustees or the President of the Trust.
11.5. Notice of Meetings. A written notice of each meeting of shareholders,
stating the place, date and hour and the purposes of the meeting, shall be given
at least ten days before the meeting to each shareholder entitled to vote
thereat by leaving such notice with him or at his residence or usual place of
business or by mailing it, postage prepaid, and addressed to such shareholder at
his address as it appears in the records of the Trust. Such notice shall be
given by the Secretary or an Assistant Secretary or by an officer designated by
the Trustees. No notice of any meeting of shareholders need be given to a
shareholder if a written waiver of notice, executed before or after the meeting
by such shareholder or his attorney thereunto duly authorized, is filed with the
records of the meeting.
11.6. Ballots. No ballot shall be required for any election unless
requested by a shareholder present or represented at the meeting and entitled to
vote in the election.
11.7. Proxies. Shareholders entitled to vote may vote either in person or
by proxy in writing dated not more than six months before the meeting named
therein, which proxies shall be filed with the Secretary or other person
responsible to record the proceedings of the meeting before being voted. Unless
otherwise specifically limited by their terms, such proxies shall entitle the
holders thereof to vote at any adjournment of such meeting but shall not be
valid after the final adjournment of such meeting. The placing of a
shareholder's name on a proxy pursuant to telephonic or electronically
transmitted instructions obtained pursuant to procedures reasonably designed to
verify that such instructions have been authorized by such shareholder shall
constitute execution of such proxy by or on behalf of such shareholder.
ARTICLE 12
Amendments to the By-Laws
These By-Laws may be amended or repealed, in whole or in part, by a
majority of the Trustees then in office at any meeting of the Trustees, or by
one or more writings signed by such a majority.
Dated: September 5, 1986
Amended: December 31, 1999
DISTRIBUTION AGREEMENT
[NAME OF FUND]
200 Park Avenue
New York, New York 10166
March 22, 2000
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Dear Sirs:
This is to confirm that, in consideration of the agreements
hereinafter contained, the above-named investment company (the "Fund") has
agreed that you shall be, for the period of this agreement, the distributor of
(a) shares of each Series of the Fund set forth on Exhibit A hereto, as such
Exhibit may be revised from time to time (each, a "Series") or (b) if no Series
are set forth on such Exhibit, shares of the Fund. For purposes of this
agreement the term "Shares" shall mean the authorized shares of the relevant
Series, if any, and otherwise shall mean the Fund's authorized shares.
1. Services as Distributor
1.1 You will act as agent for the distribution of Shares covered by,
and in accordance with, the registration statement and prospectus then in effect
under the Securities Act of 1933, as amended, and will transmit promptly any
orders received by you for purchase or redemption of Shares to the Transfer and
Dividend Disbursing Agent for the Fund of which the Fund has notified you in
writing.
1.2 You agree to use your best efforts to solicit orders for the
sale of Shares. It is contemplated that you will enter into sales or servicing
agreements with securities dealers, financial institutions and other industry
professionals, such as investment advisers, accountants and estate planning
firms, and in so doing you will act only on your own behalf as principal.
1.3 You shall act as distributor of Shares in compliance with all
applicable laws, rules and regulations, including, without limitation, all rules
and regulations made or adopted pursuant to the Investment Company Act of 1940,
as amended, by the Securities and Exchange Commission or any securities
association registered under the Securities Exchange Act of 1934, as amended.
1.4 Whenever in their judgment such action is warranted by market,
economic or political conditions, or by abnormal circumstances of any kind, the
Fund's officers may decline to accept any orders for, or make any sales of, any
Shares until such time as they deem it advisable to accept such orders and to
make such sales and the Fund shall advise you promptly of such determination.
1.5 The Fund agrees to pay all costs and expenses in connection with
the registration of Shares under the Securities Act of 1933, as amended, and all
expenses in connection with maintaining facilities for the issue and transfer of
Shares and for supplying information, prices and other data to be furnished by
the Fund hereunder, and all expenses in connection with the preparation and
printing of the Fund's prospectuses and statements of additional information for
regulatory purposes and for distribution to shareholders; provided, however,
that nothing contained herein shall be deemed to require the Fund to pay any of
the costs of advertising the sale of Shares.
1.6 The Fund agrees to execute any and all documents and to furnish
any and all information and otherwise to take all actions which may be
reasonably necessary in the discretion of the Fund's officers in connection with
the qualification of Shares for sale in such states as you may designate to the
Fund and the Fund may approve, and the Fund agrees to pay all expenses which may
be incurred in connection with such qualification. You shall pay all expenses
connected with your own qualification as a dealer under state or Federal laws
and, except as otherwise specifically provided in this agreement, all other
expenses incurred by you in connection with the sale of Shares as contemplated
in this agreement.
1.7 The Fund shall furnish you from time to time, for use in
connection with the sale of Shares, such information with respect to the Fund or
any relevant Series and the Shares as you may reasonably request, all of which
shall be signed by one or more of the Fund's duly authorized officers; and the
Fund warrants that the statements contained in any such information, when so
signed by the Fund's officers, shall be true and correct. The Fund also shall
furnish you upon request with: (a) semi-annual reports and annual audited
reports of the Fund's books and accounts made by independent public accountants
regularly retained by the Fund, (b) quarterly earnings statements prepared by
the Fund, (c) a monthly itemized list of the securities in the Fund's or, if
applicable, each Series' portfolio, (d) monthly balance sheets as soon as
practicable after the end of each month, and (e) from time to time such
additional information regarding the Fund's financial condition as you may
reasonably request.
1.8 The Fund represents to you that all registration statements and
prospectuses filed by the Fund with the Securities and Exchange Commission under
the Securities Act of 1933, as amended, and under the Investment Company Act of
1940, as amended, with respect to the Shares have been carefully prepared in
conformity with the requirements of said Acts and rules and regulations of the
Securities and Exchange Commission thereunder. As used in this agreement the
terms "registration statement" and "prospectus" shall mean any registration
statement and prospectus, including the statement of additional information
incorporated by reference therein, filed with the Securities and Exchange
Commission and any amendments and supplements thereto which at any time shall
have been filed with said Commission. The Fund represents and warrants to you
that any registration statement and prospectus, when such registration statement
becomes effective, will contain all statements required to be stated therein in
conformity with said Acts and the rules and regulations of said Commission; that
all statements of fact contained in any such registration statement and
prospectus will be true and correct when such registration statement becomes
effective; and that neither any registration statement nor any prospectus when
such registration statement becomes effective will include an untrue statement
of a material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading. The Fund may
but shall not be obligated to propose from time to time such amendment or
amendments to any registration statement and such supplement or supplements to
any prospectus as, in the light of future developments, may, in the opinion of
the Fund's counsel, be necessary or advisable. If the Fund shall not propose
such amendment or amendments and/or supplement or supplements within fifteen
days after receipt by the Fund of a written request from you to do so, you may,
at your option, terminate this agreement or decline to make offers of the Fund's
securities until such amendments are made. The Fund shall not file any amendment
to any registration statement or supplement to any prospectus without giving you
reasonable notice thereof in advance; provided, however, that nothing contained
in this agreement shall in any way limit the Fund's right to file at any time
such amendments to any registration statement and/or supplements to any
prospectus, of whatever character, as the Fund may deem advisable, such right
being in all respects absolute and unconditional.
1.9 The Fund authorizes you to use any prospectus in the form
furnished to you from time to time, in connection with the sale of Shares. The
Fund agrees to indemnify, defend and hold you, your several officers and
directors, and any person who controls you within the meaning of Section 15 of
the Securities Act of 1933, as amended, free and harmless from and against any
and all claims, demands, liabilities and expenses (including the cost of
investigating or defending such claims, demands or liabilities and any counsel
fees incurred in connection therewith) which you, your officers and directors,
or any such controlling person, may incur under the Securities Act of 1933, as
amended, or under common law or otherwise, arising out of or based upon any
untrue statement, or alleged untrue statement, of a material fact contained in
any registration statement or any prospectus or arising out of or based upon any
omission, or alleged omission, to state a material fact required to be stated in
either any registration statement or any prospectus or necessary to make the
statements in either thereof not misleading; provided, however, that the Fund's
agreement to indemnify you, your officers or directors, and any such controlling
person shall not be deemed to cover any claims, demands, liabilities or expenses
arising out of any untrue statement or alleged untrue statement or omission or
alleged omission made in any registration statement or prospectus in reliance
upon and in conformity with written information furnished to the Fund by you
specifically for use in the preparation thereof. The Fund's agreement to
indemnify you, your officers and directors, and any such controlling person, as
aforesaid, is expressly conditioned upon the Fund's being notified of any action
brought against you, your officers or directors, or any such controlling person,
such notification to be given by letter or by telegram addressed to the Fund at
its address set forth above within ten days after the summons or other first
legal process shall have been served. The failure so to notify the Fund of any
such action shall not relieve the Fund from any liability which the Fund may
have to the person against whom such action is brought by reason of any such
untrue, or alleged untrue, statement or omission, or alleged omission, otherwise
than on account of the Fund's indemnity agreement contained in this paragraph
1.9. The Fund will be entitled to assume the defense of any suit brought to
enforce any such claim, demand or liability, but, in such case, such defense
shall be conducted by counsel of good standing chosen by the Fund and approved
by you. In the event the Fund elects to assume the defense of any such suit and
retain counsel of good standing approved by you, the defendant or defendants in
such suit shall bear the fees and expenses of any additional counsel retained by
any of them; but in case the Fund does not elect to assume the defense of any
such suit, or in case you do not approve of counsel chosen by the Fund, the Fund
will reimburse you, your officers and directors, or the controlling person or
persons named as defendant or defendants in such suit, for the fees and expenses
of any counsel retained by you or them. The Fund's indemnification agreement
contained in this paragraph 1.9 and the Fund's representations and warranties in
this agreement shall remain operative and in full force and effect regardless of
any investigation made by or on behalf of you, your officers and directors, or
any controlling person, and shall survive the delivery of any Shares. This
agreement of indemnity will inure exclusively to your benefit, to the benefit of
your several officers and directors, and their respective estates, and to the
benefit of any controlling persons and their successors. The Fund agrees
promptly to notify you of the commencement of any litigation or proceedings
against the Fund or any of its officers or Board members in connection with the
issue and sale of Shares.
1.10 You agree to indemnify, defend and hold the Fund, its several
officers and Board members, and any person who controls the Fund within the
meaning of Section 15 of the Securities Act of 1933, as amended, free and
harmless from and against any and all claims, demands, liabilities and expenses
(including the cost of investigating or defending such claims, demands or
liabilities and any counsel fees incurred in connection therewith) which the
Fund, its officers or Board members, or any such controlling person, may incur
under the Securities Act of 1933, as amended, or under common law or otherwise,
but only to the extent that such liability or expense incurred by the Fund, its
officers or Board members, or such controlling person resulting from such claims
or demands, shall arise out of or be based upon any untrue, or alleged untrue,
statement of a material fact contained in information furnished in writing by
you to the Fund specifically for use in the Fund's registration statement and
used in the answers to any of the items of the registration statement or in the
corresponding statements made in the prospectus, or shall arise out of or be
based upon any omission, or alleged omission, to state a material fact in
connection with such information furnished in writing by you to the Fund and
required to be stated in such answers or necessary to make such information not
misleading. Your agreement to indemnify the Fund, its officers and Board
members, and any such controlling person, as aforesaid, is expressly conditioned
upon your being notified of any action brought against the Fund, its officers or
Board members, or any such controlling person, such notification to be given by
letter or telegram addressed to you at your address set forth above within ten
days after the summons or other first legal process shall have been served. You
shall have the right to control the defense of such action, with counsel of your
own choosing, satisfactory to the Fund, if such action is based solely upon such
alleged misstatement or omission on your part, and in any other event the Fund,
its officers or Board members, or such controlling person shall each have the
right to participate in the defense or preparation of the defense of any such
action. The failure so to notify you of any such action shall not relieve you
from any liability which you may have to the Fund, its officers or Board
members, or to such controlling person by reason of any such untrue, or alleged
untrue, statement or omission, or alleged omission, otherwise than on account of
your indemnity agreement contained in this paragraph 1.10. This agreement of
indemnity will inure exclusively to the Fund's benefit, to the benefit of the
Fund's officers and Board members, and their respective estates, and to the
benefit of any controlling persons and their successors.
You agree promptly to notify the Fund of the commencement of any litigation or
proceedings against you or any of your officers or directors in connection with
the issue and sale of Shares.
1.11 No Shares shall be offered by either you or the Fund under any
of the provisions of this agreement and no orders for the purchase or sale of
such Shares hereunder shall be accepted by the Fund if and so long as the
effectiveness of the registration statement then in effect or any necessary
amendments thereto shall be suspended under any of the provisions of the
Securities Act of 1933, as amended, or if and so long as a current prospectus as
required by Section 10 of said Act, as amended, is not on file with the
Securities and Exchange Commission; provided, however, that nothing contained in
this paragraph 1.11 shall in any way restrict or have an application to or
bearing upon the Fund's obligation to repurchase any Shares from any shareholder
in accordance with the provisions of the Fund's prospectus or charter documents.
1.12 The Fund agrees to advise you immediately in writing:
(a) of any request by the Securities and Exchange
Commission for amendments to the registration statement or
prospectus then in effect or for additional information;
(b) in the event of the issuance by the Securities and
Exchange Commission of any stop order suspending the effectiveness
of the registration statement or prospectus then in effect or the
initiation of any proceeding for that purpose;
(c) of the happening of any event which makes untrue any
statement of a material fact made in the registration statement or
prospectus then in effect or which requires the making of a change
in such registration statement or prospectus in order to make the
statements therein not misleading; and
(d) of all actions of the Securities and Exchange
Commission with respect to any amendments to any registration
statement or prospectus which may from time to time be filed with
the Securities and Exchange Commission.
2. Offering Price
Shares of any class of the Fund offered for sale by you shall be
offered for sale at a price per share (the "offering price") approximately equal
to (a) their net asset value (determined in the manner set forth in the Fund's
charter documents) plus (b) a sales charge, if any and except to those persons
set forth in the then-current prospectus, which shall be the percentage of the
offering price of such Shares as set forth in the Fund's then-current
prospectus. The offering price, if not an exact multiple of one cent, shall be
adjusted to the nearest cent. In addition, Shares of any class of the Fund
offered for sale by you may be subject to a contingent deferred sales charge as
set forth in the Fund's then-current prospectus. You shall be entitled to
receive any sales charge or contingent deferred sales charge in respect of the
Shares. Any payments to dealers shall be governed by a separate agreement
between you and such dealer and the Fund's then-current prospectus.
3. Term
This agreement shall continue until the date (the "Reapproval Date")
set forth on Exhibit A hereto (and, if the Fund has Series, a separate
Reapproval Date shall be specified on Exhibit A for each Series), and thereafter
shall continue automatically for successive annual periods ending on the day
(the "Reapproval Day") of each year set forth on Exhibit A hereto, provided such
continuance is specifically approved at least annually by (i) the Fund's Board
or (ii) vote of a majority (as defined in the Investment Company Act of 1940) of
the Shares of the Fund or the relevant Series, as the case may be, provided that
in either event its continuance also is approved by a majority of the Board
members who are not "interested persons" (as defined in said Act) of any party
to this agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval. This agreement is terminable without penalty, on 60
days' notice, (a) by vote of holders of a majority of the Fund's or, as to any
relevant Series, such Series' outstanding voting securities, or (b) by the
Fund's Board as to the Fund or the relevant Series, as the case may be, or (c)
by you. This agreement also will terminate automatically, as to the Fund or
relevant Series, as the case may be, in the event of its assignment (as defined
in said Act).
4. Miscellaneous
[4.1] The Fund recognizes that from time to time your directors,
officers, and employees may serve as trustees, directors, partners, officers,
and employees of other business trusts, corporations, partnerships, or other
entities (including other investment companies) and that such other entities may
include the name "Dreyfus" as part of their name, and that your corporation or
its affiliates may enter into distribution or other agreements with such other
entities. If you cease to act as the distributor of the Fund's shares or if The
Dreyfus Corporation or any of its affiliates ceases to act as the Fund's
investment adviser, the Fund agrees that, at the request of The Dreyfus
Corporation, the Fund will take all necessary action to change the name of the
Fund to a name not including "Dreyfus" in any form or combination of words.
4.2 (For MBTs only) This agreement has been executed on behalf of
the Fund by the undersigned officer of the Fund in his capacity as an officer of
the Fund. The obligations of this agreement shall only be binding upon the
assets and property of the Fund and shall not be binding upon any Trustee,
officer or shareholder of the Fund individually.
Please confirm that the foregoing is in accordance with your
understanding and indicate your any acceptance hereof by signing below,
whereupon it shall become a binding agreement between us.
Very truly yours,
[NAME OF FUND]
By: _______________________
Accepted:
DREYFUS SERVICE CORPORATION
By:_______________________________
BANK AFFILIATED BROKER-DEALER AGREEMENT
(FULLY DISCLOSED BASIS)
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We are a broker-dealer registered with the Securities and Exchange Commission
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"). We
desire to make available to our customers shares of beneficial interest or
common stock of open-end registered investment companies managed, advised or
administered by The Dreyfus Corporation or its subsidiaries or affiliates
(hereinafter referred to individually as a "Fund" and collectively as the
"Funds"). You are the principal underwriter (as such term is defined in the
Investment Company Act of 1940, as amended) of the offering of shares of the
Funds and the exclusive agent for the continuous distribution of such shares
pursuant to the terms of a Distribution Agreement between you and each Fund.
Unless the context otherwise requires, as used herein the term "Prospectus"
shall mean the prospectus and related statement of additional information (the
"Statement of Additional Information") incorporated therein by reference (as
amended or supplemented) of each of the respective Funds included in the then
currently effective registration statement (or post-effective amendment thereto)
of each such Fund, as filed with the Securities and Exchange Commission pursuant
to the Securities Act of 1933, as amended (the "Registration Statement").
In consideration for the mutual covenants contained herein, it is hereby agreed
that our respective rights and obligations shall be as follows:
1. With respect to any and all transactions in the shares of any Fund pursuant
to this Agreement, it is understood and agreed in each case that: (a) we
shall be acting solely as agent for the account of our customer; (b) each
transaction shall be initiated solely upon the order of our customer; (c)
you shall execute transactions only upon receiving instructions from us
acting as agent for our customer; (d) as between us and our customer, our
customer will have full beneficial ownership of all Fund shares; and (e)
each transaction shall be for the account of our customer and not for our
account. We represent and warrant to you that (a) we will have full right,
power and authority to effect transactions (including, without limitation,
any purchases, exchanges and redemptions) in Fund shares on behalf of all
customer accounts provided by us to you or to any transfer agent as such
term is defined in the Prospectus of each Fund (the "Transfer Agent"); and
(b) we have taken appropriate verification measures to ensure transactions
are in compliance with all applicable laws and regulations concerning
foreign exchange controls and money laundering.
2. All orders for the purchase of any Fund shares shall be executed at the
then current public offering price per share (i.e., the net asset value per
share plus the applicable sales charge, if any) and all orders for the
redemption of any Fund shares shall be executed at the net asset value per
share less the applicable deferred sales charge, redemption fee or similar
charge or fee, if any, in each case as described in the Prospectus of such
Fund. The minimum initial purchase order and minimum subsequent purchase
order shall be as set forth in the Prospectus of such Fund. All orders are
subject to acceptance or rejection by you at your sole discretion. Unless
otherwise mutually agreed in writing, each transaction shall be promptly
confirmed in writing directly to the customer on a fully disclosed basis
and a copy of each confirmation shall be sent simultaneously to us. You
reserve the right, at your discretion and without notice, to suspend the
sale of shares or withdraw entirely the sale of shares of any or all of the
Funds.
3. In ordering shares of any Fund, we shall rely solely and conclusively on
the representations contained in the Prospectus of such Fund. We agree that
we shall not make shares of any Fund available to our customers except in
compliance with all applicable federal and state laws, and the rules,
regulations, requirements and conditions of all applicable regulatory and
self-regulatory agencies or authorities. We agree that we shall not
purchase any Fund shares, as agent for any customer, unless we deliver or
cause to be delivered to such customer, at or prior to the time of such
purchase, a copy of the Prospectus of such Fund, or unless such customer
has acknowledged receipt of the Prospectus of such Fund. We further agree
to obtain from each customer for whom we act as agent for the purchase of
Fund shares any taxpayer identification number certification and such other
information as may be required from time to time under the Internal Revenue
Code of 1986, as amended (the "Code"), and the regulations promulgated
thereunder, and to provide you or your designee with timely written notice
of any failure to obtain such taxpayer identification number certification
or other information in order to enable the implementation of any required
withholding. We will be responsible for the proper instruction and training
of all sales personnel employed by us. Unless otherwise mutually agreed in
writing, you shall deliver or cause to be delivered to each of the
customers who purchases shares of any of the Funds through us pursuant to
this Agreement copies of all annual and interim reports, proxy solicitation
materials and any other information and materials relating to such Funds
and prepared by or on behalf of you, the Fund or its investment adviser,
custodian, Transfer Agent or dividend disbursing agent for distribution to
each such customer. You agree to supply us with copies of the Prospectus,
Statement of Additional Information, annual reports, interim reports, proxy
solicitation materials and any such other information and materials
relating to each Fund in reasonable quantities upon request.
4. We shall not make any representations concerning any Fund shares other than
those contained in the Prospectus of such Fund or in any promotional
materials or sales literature furnished to us by you or the Fund. We shall
not furnish or cause to be furnished to any person or display or publish
any information or materials relating to any Fund (including, without
limitation, promotional materials and sales literature, advertisements,
press releases, announcements, statements, posters, signs or other similar
materials), except such information and materials as may be furnished to us
by you or the Fund, and such other information and materials as may be
approved in writing by you. In making Fund shares available to our
customers hereunder, or in providing investment advice regarding such
shares to our customers, we shall at all tim.es act in compliance with the
Interagency Statement on Retail Sales of Nondeposit Investment Products
issued by The Board of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, the Office of the Comptroller of the
Currency, and the Office of Thrift Supervision (February 15, 1994) or any
successor interagency requirements as in force at the time such services
are provided.
5. In determining the amount of any reallowance payable to us hereunder, you
reserve the right to exclude any sales which you reasonably determine are
not made in accordance with the terms of the applicable Fund Prospectuses
or the provisions of this Agreement.
6. (a) In the case of any Fund shares sold with a sales charge, customers may
be entitled to a reduction in the sales charge on purchases made under a
letter of intent ("Letter of Intent") in accordance with the Fund
Prospectus. In such a case, our reallowance will be paid based upon the
reduced sales charge, but an adjustment to the reallowance will be made in
accordance with the Prospectus of the applicable Fund to reflect actual
purchases of the customer if such customer's Letter of Intent is not
fulfilled. The sales charge and/or reallowance may be changed at any time
in your sole discretion upon written notice to us.
(b) Subject to and in accordance with the terms of the Prospectus of
each Fund sold with a sales charge, a reduced sales charge may be
applicable with respect to customer accounts through a right of
accumulation under which customers are permitted to purchase shares of a
Fund at the then current public offering price per share applicable to the
total of (i) the dollar amount of shares then being purchased plus (ii) an
amount equal to the then current net asset value or public offering price
originally paid per share, whichever is higher, of the customer's combined
holdings of the shares of such Fund and of any other open-end registered
investment company as may be permitted by the applicable Fund Prospectus.
In such case, we agree to furnish to you or the Transfer Agent sufficient
information to permit your confirmation of qualification for a reduced
sales charge, and acceptance of the purchase order is subject to such
confirmation.
(c) With respect to Fund shares sold with a sales charge, we agree to
advise you promptly at your request as to amounts of any and all purchases
of Fund shares made by us, as agent for our customers, qualifying for a
reduced sales charge.
(d) Exchanges (i.e., the investment of the proceeds from the liquidation
of shares of one open-end registered investment company managed, advised or
administered by The Dreyfus Corporation or its subsidiaries or affiliates
in the shares of another open-end registered investment company managed,
advised or administered by The Dreyfus Corporation or its subsidiaries or
affiliates) shall, where available, be made subject to and in accordance
with the terms of each relevant Fund's Prospectus.
(e) Unless at the time of transmitting an order we advise you or the
Transfer Agent to the contrary, the shares ordered will be deemed to be the
total holdings of the specified customer.
7. Subject to and in accordance with the terms of each Fund Prospectus and
Service Plan, Shareholder Services Plan, Distribution Plan or other similar
plan, if any, we understand that you may pay to certain financial
institutions, securities dealers and other industry professionals with which
you have entered into an agreement in substantially the form annexed hereto
as Appendix A, B or C (or such other form as may be approved from time to
time by the board of directors, or trustees or managing general partners of
the Fund) such fees as may be determined by you in accordance with such
agreement for shareholder, administrative or distribution-related services as
described therein.
8. The procedures relating to all orders and the handling thereof will be
subject to the terms of the Prospectus of each Fund and your written
instructions to us from time to time. No conditional orders will be
accepted. We agree to place orders with you immediately for the same number
of shares and at the same price as any orders we receive from our
customers. We shall not withhold placing orders received from customers so
as to profit ourselves as a result of such withholding by a change in the
net asset value from that used in determining the offering price to such
customers, or otherwise; provided, however, that the foregoing shall not
prevent the purchase of shares of any Fund by us for our own bona fide
investment. We agree that: (a) we shall not effect any transactions
(including, without limitation, any purchases, exchanges and redemptions)
in any Fund shares registered in the name of, or beneficially owned by, any
customer unless such customer has granted us full right, power and
authority to effect such transactions on such customer's behalf, and (b)
you, each Fund, the Transfer Agent and your and their respective officers,
directors, trustees, managing general partners, agents, employees and
affiliates shall not be liable for, and shall be fully indemnified and held
harmless by us from and against, any and all claims, demands, liabilities
and expenses (including, without limitation, reasonable attorneys' fees)
which may be incurred by you or any of the foregoing persons entitled to
indemnification from us hereunder arising out of or in connection with the
execution of any transactions in Fund shares registered in the name of, or
beneficially owned by, any customer in reliance upon any oral or written
instructions reasonably believed to be genuine and to have been given by or
on behalf of us.
9. (a) We agree to remit on behalf of our customers the purchase price for
purchase orders of any Fund shares placed by us in accordance with the
terms of the Prospectus of the applicable Fund. On or before the settlement
date of each purchase order for shares of any Fund, we shall either (i)
remit to an account designated by you with the Transfer Agent an amount
equal to the then current public offering price of the shares of such Fund
being purchased less our reallowance, if any, with respect to such purchase
order as determined by you in accordance with the terms of the applicable
Fund Prospectus, or (ii) remit to an account designated by you with the
Transfer Agent an amount equal to the then current public offering price of
the shares of such Fund being purchased without deduction for our
reallowance, if any, with respect to such purchase order as determined by
you in accordance with the terms of the applicable Fund Prospectus, in
which case our reallowance, if any, shall be payable to us by you on at
least a monthly basis. If payment for any purchase order is not received in
accordance with the terms of the applicable Fund Prospectus, you reserve
the right, without notice, to cancel the sale and to hold us responsible
for any loss sustained as a result thereof.
(b) If any shares sold to us as agent for our customers under the terms
of this Agreement are sold with a sales charge and are redeemed for the
account of the Fund or are tendered for redemption within seven (7) business
days after the date of purchase: (i) we shall forthwith refund to you the
full reallowance received by us on the sale; and (ii) you shall forthwith pay
to the Fund your portion of the sales charge on the sale which had been
retained by you and shall also pay to the Fund the amount refunded by us.
10. Certificates for shares sold to us as agent for our customers hereunder
shall only be issued in accordance with the terms of each Fund's Prospectus
upon our customers' specific request and, upon such request, shall be
promptly delivered to our customers by the Transfer Agent unless other
arrangements are made by us. However, in making delivery of such share
certificates to our customers, the Transfer Agent shall have adequate time
to clear any checks drawn for the payment of Fund shares.
11. Each party hereby represents and warrants to the other party that: (a) it
is a corporation, partnership or other entity duly organized and validly
existing in good standing under the laws of the jurisdiction in which it
was organized; (b) it is duly registered as a broker-dealer with the
Securities and Exchange Commission and, to the extent required, with
applicable state agencies or authorities having jurisdiction over
securities matters, and it is a member of the National Association of
Securities Dealers, Inc. (the "NASD"); (c) it will comply with all
applicable federal and state laws, and the rules, regulations, requirements
and conditions of all applicable regulatory and self-regulatory agencies or
authorities in the performance of its duties and responsibilities
hereunder; (d) the execution and delivery of this Agreement and the
performance of the transactions contemplated hereby have been duly
authorized by all necessary action, and all other authorizations and
approvals (if any) required for its lawful execution and delivery of this
Agreement and its performance hereunder have been obtained; and (e) upon
execution and delivery by it, and assuming due and valid execution and
delivery by the other party, this Agreement will constitute a valid and
binding agreement, enforceable in accordance with its terms. Each party
agrees to provide the other party with such information and access to
appropriate records as may be reasonably required to verify its compliance
with the provisions of this Agreement.
12. You agree to inform us, upon our request, as to the states in which you
believe the shares of the Funds have been qualified for sale under, or are
exempt from the requirements of, the respective securities laws of such
states, but you shall have no obligation or responsibility as to our right
to make shares of any Funds available to our customers in any jurisdiction.
We agree to notify you immediately in the event of (a) our expulsion or
suspension from the NASD, or (b) our violation of any applicable federal or
state law, rule, regulation, requirement or condition arising out of or in
connection with this Agreement, or which may otherwise affect in any
material way our ability to act in accordance with the terms of this
Agreement. Our expulsion from the NASD will automatically terminate this
Agreement immediately without notice. Our suspension from the NASD for
violation of any applicable federal or state law, rule, regulation,
requirement or condition will terminate this Agreement effective
immediately upon your written notice of termination to us.
13. (a) You agree to indemnify, defend and hold us, our several officers and
directors, and any person who controls us within the meaning of Section 15
of the Securities Act of 1933, as amended, free and harmless from and
against any and all claims, demands, liabilities and expenses (including
the cost of investigating or defending such claims, demands or liabilities
and any counsel fees incurred in connection therewith) which we, our
officers and directors, or any such controlling person, may incur under the
Securities Act of 1933, as amended, or under common law or otherwise,
arising out of or based upon (i) any breach of any representation, warranty
or covenant made by you herein, or (ii) any failure by you to perform your
obligations as set forth herein, or (iii) any untrue statement, or alleged
untrue statement, of a material fact contained in any Registration
Statement or any Prospectus, or arising out of or based upon any omission,
or alleged omission, to state a material fact required to be stated in
either any Registration Statement or any Prospectus, or necessary to make
the statements in any thereof not misleading; provided, however, that your
agreement to indemnify us, our officers and directors, and any such
controlling person shall not be deemed to cover any claims, demands,
liabilities or expenses arising out of any untrue statement or alleged
untrue statement or omission or alleged omission made in any Registration
Statement or Prospectus in reliance upon and in conformity with written
information furnished to you or the Fund by us specifically for use in the
preparation thereof. Your agreement to indemnify us, our officers and
directors, and any such controlling person, as aforesaid, is expressly
conditioned upon your being notified of any action brought against our
officers or directors, or any such controlling person, such notification to
be given by letter or by telecopier, telex, telegram or similar means of
same day delivery received by you at your address as specified in Paragraph
18 of this Agreement within seven (7) days after the summons or other first
legal process shall have been served. The failure so to notify you of any
such action shall not relieve you from any liability which you may have to
the person against whom such action is brought by reason of any such
breach, failure or untrue, or alleged untrue, statement or omission, or
alleged omission, otherwise than on account of your indemnity agreement
contained in this Paragraph 1 3(a). You will be entitled to assume the
defense of any suit brought to enforce any such claim, demand, liability or
expense. In the event that you elect to assume the defense of any such suit
and retain counsel, the defendant or defendants in such suit shall bear the
fees and expenses of any additional counsel retained by any of them; but in
case you do not elect to assume the defense of any such suit, you will
reimburse us, our officers and directors, and any controlling persons named
as defendants in such suit, for the fees and expenses of any counsel
retained by us and/or them. Your indemnification agreement contained in
this Paragraph 1 3(a) shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of any person entitled
to indemnification pursuant to this Paragraph 13(a), and shall survive the
delivery of any Fund shares and termination of this Agreement. This
agreement of indemnity will inure exclusively to the benefit of the persons
entitled to indemnification from you pursuant to this Agreement and their
respective estates, successors and assigns.
(b) We agree to indemnify, defend and hold you and your several officers
and directors, and each Fund and its several officers and directors or
trustees or managing general partners, and any person who controls you and/or
each Fund within the meaning of Section 15 of the Securities Act of 1933, as
amended, free and harmless from and against any and all claims, demands,
liabilities and expenses (including the cost of investigating or defending
such claims, demands or liabilities and any counsel fees incurred in
connection therewith) which you and your several officers and directors, or
the Fund and its officers and directors or trustees or managing general
partners, or any such controlling person, may incur under the Securities Act
of 1933, as amended, or under common law or otherwise, arising out of or
based upon (i) any breach of any representation, warranty or covenant made by
us herein, or (ii) any failure by us to perform our obligations as set forth
herein, or (iii) any untrue, or alleged untrue, statement of a material fact
contained in the information furnished in writing by us to you or any Fund
specifically for use in such Fund's Registration Statement or Prospectus, or
used in the answers to any of the items of the Registration Statement or in
the corresponding statements made in the Prospectus, or arising out of or
based upon any omission, or alleged omission, to state a material fact in
connection with such information furnished in writing by us to you or the
Fund and required to be stated in such answers or necessary to make such
information not misleading. Our agreement to indemnify you and your officers
and directors, and the Fund and its officers and directors or trustees or
managing general partners, and any such controlling person, as aforesaid, is
expressly conditioned upon our being notified of any action brought against
any person or entity entitled to indemnification hereunder, such notification
to be given by letter or by telecopier, telex, telegram or similar means of
same day delivery received by us at our address as specified in Paragraph 18
of this Agreement within seven (7) days after the summons or other first
legal process shall have been served. The failure so to notify us of any such
action shall not relieve us from any liability which we may have to you or
your officers and directors, or to the Fund or its officers and directors or
trustees or managing general partners, or to any such controlling person, by
reason of any such breach, failure or untrue, or alleged untrue, statement or
omission, or alleged omission, otherwise than on account of our indemnity
agreement contained in this Paragraph 13(b). We will be entitled to assume
the defense of any suit brought to enforce any such claim, demand, liability
or expense. In the event that we elect to assume the defense of any such suit
and retain counsel, the defendant or defendants in such suit shall bear the
fees and expenses of any additional counsel retained by any of them; but in
case we do not elect to assume the defense of any such suit, we will
reimburse you and your officers and directors, and the Fund and its officers
and directors or trustees or managing general partners, and any controlling
persons named as defendants in such suit, for the fees and expenses of any
counsel retained by you and/or them. Our indemnification agreements contained
in Paragraph 8 above, Paragraph 16 below and this Paragraph 13(b) shall
remain operative and in full force and effect regardless of any investigation
made by or on behalf of any person entitled to indemnification pursuant to
Paragraph 8 above, Paragraph 16 below or this Paragraph 13(b), and shall
survive the delivery of any Fund shares and termination of this Agreement.
Such agreements of indemnity will inure exclusively to the benefit of the
persons entitled to indemnification hereunder and their respective estates,
successors and assigns.
14. The names and addresses and other information concerning our customers are
and shall remain our sole property, and neither you nor your affiliates
shall use such names, addresses or other information for any purpose except
in connection with the performance of your duties and responsibilities
hereunder and except for servicing and informational mailings relating to
the Funds. Notwithstanding the foregoing, this Paragraph 14 shall not
prohibit you or any of your affiliates from utilizing for any purpose the
names, addresses or other information concerning any of our customers if
such names, addresses or other h~formation are obtained in any manner other
than from us pursuant to this Agreement. The provisions of this Paragraph
14 shall survive the termination of this Agreement.
15. We agree to serve as a service agent or to provide distribution assistance,
in accordance with the terms of the Form of Service Agreement annexed
hereto as Appendix A, Form of Shareholder Services Agreement annexed hereto
as Appendix B, and/or Form of Distribution Plan Agreement annexed hereto as
Appendix C, as applicable, for all of our customers who purchase shares of
any and all Funds whose Prospectuses provide therefor. By executing this
Agreement, each of the parties hereto agrees to be bound by all terms,
conditions, rights and obligations set forth in the forms of agreement
annexed hereto and further agrees that such forms of agreement supersede
any and all prior service agreements or other similar agreements between
the parties hereto relating to any Fund or Funds. It is recognized that
certain parties may not be permitted to collect distribution fees under the
Form of Distribution Plan Agreement annexed hereto, and if we are such a
party, we will not collect such fees.
16. By completing the Expedited Redemption Information Form annexed hereto as
Appendix D, we agree that you, each Fund with respect to which you permit
us to exercise an expedited redemption privilege, the transfer agent of
each such Fund, and your and their respective officers, directors or
trustees or managing general partners, agents, employees and affiliates
shall not be liable for and shall be fully indemnified and held harmless by
us from and against any and all claims, demands, liabilities and expenses
(including, without limitation, reasonable attorneys' fees) arising out of
or in connection with any expedited redemption payments made in reliance
upon the information set forth in such Appendix D.
17. Neither this Agreement nor the performance of the services of the
respective parties hereunder shall be considered to constitute an exclusive
arrangement, or to create a partnership, association or joint venture
between you and us. Neither party hereto shall be, act as, or represent
itself as, the agent or representative of the other, nor shall either party
have the right or authority to assume, create or incur any liability or any
obligation of any kind, express or implied, against or in the name of, or
on behalf of, the other party. This Agreement is not intended to, and shall
not, create any rights against either party hereto by any third party
solely on account of this Agreement. Neither party hereto shall use the
name of the other party in any manner without the other party's prior
written consent, except as required by any applicable federal or state law,
rule, regulation, requirement or condition, and except pursuant to any
promotional programs mutually agreed upon in writing by the parties hereto.
18. Except as otherwise specifically provided herein, all notices required or
permitted to be given pursuant to this Agreement shall be given in writing
and delivered by personal delivery or by postage prepaid, registered or
certified United States first class mail, return receipt requested, or by
telecopier, telex, telegram or similar means of same day delivery (with a
confirming copy by mail as provided herein). Unless otherwise notified in
writing, all notices to you shall be given or sent to you at your offices
located at 200 Park Avenue, New York, New York 10166, Attention: General
Counsel, and all notices to us shall be given or sent to us at our address
shown below.
19. This Agreement shall become effective only when accepted and signed by you,
and may be terminated at any time by either party hereto upon 15 days'
prior written notice to the other party. This Agreement, including the
Appendices hereto, may be amended by you upon 15 days' prior written notice
to us, and such amendment shall be deemed accepted by us upon the placement
of any order for the purchase of Fund shares or the acceptance of a fee
payable under this Agreement, including the Appendices hereto, after the
effective date of any such amendment. This Agreement may not be assigned by
us without your prior written consent. This Agreement constitutes the
entire agreement and understanding between the parties hereto relating to
the subject matter hereof and supersedes any and all prior agreements
between the parties hereto relating to the subject matter hereof.
20. This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York, without giving effect to principles
of conflicts of laws.
Very truly yours,
Firm Name (Please Print or Type)
Address
Date: By:
------------------
Authorized Signature
NOTE: Please sign and return both copies of this Agreement to Dreyfus
Service Corporation. Upon acceptance one countersigned copy will be returned to
you for your files.
Accepted:
DREYFUS SERVICE CORPORATION
Date: By:
------------------
Authorized Signature
APPENDIX A
TO BANK AFFILIATED BROKER-DEALER AGREEMENT
FORM OF SERVICE AGREEMENT
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We wish to enter into an Agreement with you for servicing shareholders of, and
administering shareholder accounts in, certain mutual fund(s) managed, advised
or administered by The Dreyfus Corporation or its subsidiaries or affiliates
(hereinafter referred to individually as the "Fund" and collectively as the
"Funds"). You are the principal underwriter as defined in the Investment Company
Act of 1940, as amended (the "Act"), and the exclusive agent for the continuous
distribution of shares of the Funds.
The terms and conditions of this Agreement are as follows:
1. We agree to provide shareholder and administrative services for our clients
who own shares of the Funds ("clients"), which services may include,
without limitation: assisting clients in changing dividend options, account
designations and addresses; performing sub-accounting; establishing and
maintaining shareholder accounts and records; processing purchase and
redemption transactions; providing periodic statements and/or reports
showing a client's account balance and integrating such statements with
those of other transactions and balances in the client's other accounts
serviced by us; arranging for bank wires; and providing such other
information and services as you reasonably may request, to the extent we
are permitted by applicable statute, rule or regulation. In this regard, if
we are a subsidiary or affiliate of a federally chartered and supervised
bank or other banking organization, you recognize that we may be subject to
the provisions of the Glass-Steagall Act and other laws, rules, regulations
or requirements governing, among other things, the conduct of our
activities. As such, we are restricted in the activities we may undertake
and for which we may be paid and, therefore, intend to perform only those
activities as are consistent with our statutory and regulatory obligations.
We represent and warrant to, and agree with you, that the compensation
payable to us hereunder, together with any other compensation payable to us
by clients in connection with the investment of their assets in shares of
the Funds, will be properly disclosed by us to our clients.
2. We shall provide such office space and equipment, telephone facilities and
personnel (which may be all or any part of the space, equipment and
facilities currently used in our business, or all or any personnel employed
by us) as is necessary or beneficial for providing information and services
to each Fund's shareholders, and to assist you in servicing accounts of
clients. We shall transmit promptly to clients all communications sent to
us for transmittal to clients by or on behalf of you, any Fund, or any
Fund's investment adviser, custodian or transfer or dividend disbursing
agent.
3. We agree that neither we nor any of our employees or agents are authorized
to make any representation concerning shares of any Fund, except those
contained in the then current Prospectus for such Fund, copies of which
will be supplied by you to us in reasonable quantities upon request. If we
are a subsidiary or an affiliate of a federally supervised bank or thrift
institution, we agree that in providing services hereunder we shall at all
times act in compliance with the Interagency Statement on Retail Sales of
Nondeposit Investment Products issued by The Board of Governors of the
Federal Reserve System, the Federal Deposit Insurance Corporation, the
Office of the Comptroller of the Currency, and the Office of Thrift
Supervision (February 15, 1994) or any successor interagency requirements
as in force at the time such services are provided. We shall have no
authority to act as agent for the Funds or for you.
4. You reserve the right, at your discretion and without notice, to suspend
the sale of shares or withdraw the sale of shares of any or all of the
Funds.
5. We acknowledge that this Agreement shall become effective for a Fund only
when approved by vote of a majority of (i) the Fund's Board of Directors or
Trustees or Managing General Partners, as the case may be (collectively
"Directors," individually "Director"), and (ii) Directors who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such approval.
6. This Agreement shall continue until the last day of the calendar year next
following the date of execution, and thereafter shall continue
automatically for successive annual periods ending on the last day of each
calendar year. For all Funds as to which Board approval of this Agreement
is required, such continuance must be approved specifically at least
annually by a vote of a majority of (i) the Fund's Board of Directors and
(ii) Directors who are not "interested persons" (as defined in the Act) of
the Fund and have no direct or indirect financial interest in this
Agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval. For any Fund as to which Board approval of this
Agreement is required, this Agreement is terminable without penalty, at any
time, by a majority of the Fund's Directors who are not "interested
persons" (as defined in the Act) and have no direct or indirect financial
interest in this Agreement or, upon not more than 60 days' written notice,
by vote of holders of a majority of the Fund's shares. As to all Funds,
this Agreement is terminable without penalty upon 15 days' notice by either
party. In addition, you may terminate this Agreement as to any or all Funds
immediately, without penalty, if the present investment adviser of such
Fund(s) ceases to serve the Fund(s) in such capacity, or if you cease to
act as distributor of such Fund(s). Notwithstanding anything contained
herein, if we fail to perform the shareholder servicing and administrative
functions contemplated herein by you as to any or all of the Funds, this
Agreement shall be terminable effective upon receipt of notice thereof by
us. This Agreement also shall terminate automatically in the event of its
assignment (as defined in the Act).
7. In consideration of the services and facilities described herein, we shall
be entitled to receive from you, and you agree to pay to us, the fees
described as payable to us in each Fund's Service Plan adopted pursuant to
Rule 12b-1 under the Act, and Prospectus and related Statement of
Additional Information. We understand that any payments pursuant to this
Agreement shall be paid only so long as this Agreement and such Plan are in
effect. We agree that no Director, officer or shareholder of the Fund shall
be liable individually for the performance of the obligations hereunder or
for any such payments.
8. We agree to provide to you and each applicable Fund such information
relating to our services hereunder as may be required to be maintained by
you and/or such Fund under applicable federal or state laws, and the rules,
regulations, requirements or conditions of applicable regulatory and
self-regulatory agencies or authorities.
9. This Agreement shall not constitute either party the legal representative
of the other, nor shall either party have the right or authority to assume,
create or incur any liability or any obligation of any kind, express or
implied, against or in the name of or on behalf of the other party.
10. All notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by personal delivery or by postage
prepaid, registered or certified United States first class mail, return
receipt requested, or by telecopier, telex, telegram or similar means of
same day delivery (with a confirming copy by mail as provided herein).
Unless otherwise notified in writing, all notices to you shall be given or
sent to you at 200 Park Avenue, New York, New York 10166, Attention:
General Counsel, and all notices to us shall be given or sent to us at our
address which shall be furnished to you in writing on or before the
effective date of this Agreement.
11. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principles of conflict of
laws.
APPENDIX B
TO BANK AFFILIATED BROKER-DEALER AGREEMENT
FORM OF SHAREHOLDER SERVICES AGREEMENT
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We wish to enter into an Agreement with you for servicing shareholders of, and
administering shareholder accounts in, certain mutual fund(s) managed, advised
or administered by The Dreyfus Corporation or its subsidiaries or affiliates
(hereinafter referred to individually as the "Fund" and collectively as the
"Funds"). You are the principal underwriter as defined in the Investment Company
Act of 1940, as amended (the "Act"), and the exclusive agent for the continuous
distribution of shares of the Funds.
The terms and conditions of this Agreement are as follows:
1. We agree to provide shareholder and administrative services for our clients
who own shares of the Funds ("clients"), which services may include,
without limitation: assisting clients in changing dividend options, account
designations and addresses; performing sub-accounting; establishing and
maintaining shareholder accounts and records; processing purchase and
redemption transactions; providing periodic statements and/or reports
showing a client's account balance and integrating such statements with
those of other transactions and balances in the client's other accounts
serviced by us; arranging for bank wires; and providing such other
information and services as you reasonably may request, to the extent we
are permitted by applicable statute, rule or regulation. In this regard, if
we are a subsidiary or affiliate of a federally chartered and supervised
bank or other banking organization, you recognize that we may be subject to
the provisions of the Glass-Steagall Act and other laws, rules, regulations
or requirements governing, among other things, the conduct of our
activities. As such, we are restricted in the activities we may undertake
and for which we may be paid and, therefore, intend to perform only those
activities as are consistent with our statutory and regulatory obligations.
We represent and warrant to, and agree with you, that the compensation
payable to us hereunder, together with any other compensation payable to us
by clients in connection with the investment of their assets in shares of
the Funds, will be properly disclosed by us to our clients, will be
authorized by our clients and will not result in an excessive or
unauthorized fee to us.
2. We shall provide such office space and equipment, telephone facilities and
personnel (which may be all or any part of the space, equipment and
facilities currently used in our business, or all or any personnel employed
by us) as is necessary or beneficial for providing information and services
to each Fund's shareholders, and to assist you in servicing accounts of
clients. We shall transmit promptly to clients all communications sent to
us for transmittal to clients by or on behalf of you, any Fund, or any
Fund's investment adviser, custodian or transfer or dividend disbursing
agent. We agree that in the event an issue pertaining to a Fund's
Shareholder Services Plan is submitted for shareholder approval, we will
vote any Fund shares held for our own account in the same proportion as the
vote of those shares held for our clients' accounts.
3. We agree that neither we nor any of our employees or agents are authorized
to make any representation concerning shares of any Fund, except those
contained in the then current Prospectus for such Fund, copies of which
will be supplied by you to us in reasonable quantities upon request. If we
are a subsidiary or an affiliate of a federally supervised bank or thrift
institution, we agree that in providing services hereunder we shall at all
times act in compliance with the Interagency Statement on Retail Sales of
Nondeposit Investment Products issued by The Board of Governors of the
Federal Reserve System, the Federal Deposit Insurance Corporation, the
Office of the Comptroller of the Currency, and the Office of Thrift
Supervision (February 15, 1994) or any successor interagency requirements
as in force at the time such services are provided. We shall have no
authority to act as agent for the Funds or for you.
4. You reserve the right, at your discretion and without notice, to suspend
the sale of shares or withdraw the sale of shares of any or all of the
Funds.
5. We acknowledge that this Agreement shall become effective for a Fund only
when approved by vote of a majority of (i) the Fund's Board of Directors or
Trustees or Managing General Partners, as the case may be (collectively
"Directors," individually "Director"), and (ii) Directors who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such approval.
6. This Agreement shall continue until the last day of the calendar year next
following the date of execution, and thereafter shall continue
automatically for successive annual periods ending on the last day of each
calendar year. Such continuance must be approved specifically at least
annually by a vote of a majority of (i) the Fund's Board of Directors and
(ii) Directors who are not "interested persons" (as defined in the Act) of
the Fund and have no direct or indirect financial interest in this
Agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval. This Agreement is terminable without penalty, at
any time, by a majority of the Fund's Directors who are not "interested
persons" (as defined in the Act) and have no direct or indirect financial
interest in this Agreement. This Agreement is terminable without penalty
upon 15 days' notice by either party. In addition, you may terminate this
Agreement as to any or all Funds immediately, without penalty, if the
present investment adviser of such Fund(s) ceases to serve the Fund(s) in
such capacity, or if you cease to act as distributor of such Fund(s).
Notwithstanding anything contained herein, if we fail to perform the
shareholder servicing and administrative functions contemplated herein by
you as to any or all of the Funds, this Agreement shall be terminable
effective upon receipt of notice thereof by us. This Agreement also shall
terminate automatically in the event of its assignment (as defined in the
Act).
7. In consideration of the services and facilities described herein, we shall
be entitled to receive from you, and you agree to pay to us, the fees
described as payable to us in each Fund's Shareholder Services Plan and
Prospectus and related Statement of Additional Information. We understand
that any payments pursuant to this Agreement shall be paid only so long as
this Agreement and such Plan are in effect. We agree that no Director,
officer or shareholder of the Fund shall be liable individually for the
performance of the obligations hereunder or for any such payments.
8. We agree to provide to you and each applicable Fund such information
relating to our services hereunder as may be required to be maintained by
you and/or such Fund under applicable federal or state laws, and the rules,
regulations, requirements or conditions of applicable regulatory and
self-regulatory agencies or authorities.
9. This Agreement shall not constitute either party the legal representative
of the other, nor shall either party have the right or authority to assume,
create or incur any liability or any obligation of any kind, express or
implied, against or in the name of or on behalf of the other party.
10. All notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by personal delivery or by postage
prepaid, registered or certified United States first class mail, return
receipt requested, or by telecopier, telex, telegram or similar means of
same day delivery (with a confirming copy by mail as provided herein).
Unless otherwise notified in writing, all notices to you shall be given or
sent to you at 200 Park Avenue, New York, New York 10166, Attention:
General Counsel, and all notices to us shall be given or sent to us at our
address which shall be furnished to you in writing on or before the
effective date of this Agreement.
11. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principles of conflict of
laws.
APPENDIX C
TO BANK AFFILIATED BROKER-DEALER AGREEMENT
FORM OF DISTRIBUTION PLAN AGREEMENT
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We wish to enter into an Agreement with you with respect to our providing
distribution assistance relating to shares of certain mutual fund(s) managed,
advised or administered by The Dreyfus Corporation or its subsidiaries or
affiliates (hereinafter referred to individually as the "Fund" and collectively
as the "Funds"). You are the principal underwriter as defined in the Investment
Company Act of 1940, as amended (the "Act"), and the exclusive agent for the
continuous distribution of shares of the Funds.
The terms and conditions of this Agreement are as follows:
1. We agree to provide distribution assistance in connection with the sale of
shares of the Funds. In this regard, if we are a subsidiary or affiliate of
a federally chartered and supervised bank or other banking organization,
you recognize that we may be subject to the provisions of the
Glass-Steagall Act and other laws, rules, regulations or requirements
governing, among other things, the conduct of our activities. As such, we
are restricted in the activities we may undertake and for which we may be
paid and, therefore, intend to perform only those activities as are
consistent with our statutory and regulatory obligations. We represent and
warrant to, and agree with you, that the compensation payable to us
hereunder, together with any other compensation payable to us by clients in
connection with the investment of their assets in shares of the Funds, will
be properly disclosed by us to our clients.
2. We shall provide such office space and equipment, telephone facilities and
personnel (which may be all or any part of the space, equipment and
facilities currently used in our business, or all or any personnel employed
by us) as is necessary or beneficial for providing services hereunder. We
shall transmit promptly to clients all communications sent to us for
transmittal to clients by or on behalf of you, any Fund, or any Fund's
investment adviser, custodian or transfer or dividend disbursing agent.
3. We agree that neither we nor any of our employees or agents are authorized
to make any representation concerning shares of any Fund, except those
contained in the then current Prospectus for such Fund, copies of which
will be supplied by you to us in reasonable quantities upon request. If we
are a subsidiary or an affiliate of a federally supervised bank or thrift
institution, we agree that in providing services hereunder we shall at all
times act in compliance with the Interagency Statement on Retail Sales of
Nondeposit Investment Products issued by The Board of Governors of the
Federal Reserve System, the Federal Deposit Insurance Corporation, the
Office of the Comptroller of the Currency, and the Office of Thrift
Supervision (February 15, 1994) or any successor interagency requirements
as in force at the time such services are provided. We shall have no
authority to act as agent for the Funds or for you.
4. You reserve the right, at your discretion and without notice, to suspend
the sale of shares or withdraw the sale of shares of any or all of the
Funds.
5. We acknowledge that this Agreement shall become effective for a Fund only
when approved by vote of a majority of (i) the Fund's Board of Directors or
Trustees or Managing General Partners, as the case may be (collectively
"Directors," individually "Director"), and (ii) Directors who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such approval.
6. This Agreement shall continue until the last day of the calendar year next
following the date of execution, and thereafter shall continue
automatically for successive annual periods ending on the last day of each
calendar year. Such continuance must be approved specifically at least
annually by a vote of a majority of (i) the Fund's Board of Directors and
(ii) Directors who are not "interested persons" (as defined in the Act) of
the Fund and have no direct or indirect financial interest in this
Agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval. This Agreement is terminable without penalty, at
any time, by a majority of the Fund's Directors who are not "interested
persons" (as defined in the Act) and have no direct or indirect financial
interest in this Agreement or, upon not more than 60 days' written notice,
by vote of holders of a majority of the Fund's shares. This Agreement is
terminable without penalty upon 15 days' notice by either party. In
addition, you may terminate this Agreement as to any or all Funds
immediately, without penalty, if the present investment adviser of such
Fund(s) ceases to serve the Fund(s) in such capacity, or if you cease to
act as distributor of such Fund(s). Notwithstanding anything contained
herein, if we fail to perform the distribution functions contemplated
herein by you as to any or all of the Funds, this Agreement shall be
terminable effective upon receipt of notice thereof by us. This Agreement
also shall terminate automatically in the event of its assignment (as
defined in the Act).
7. In consideration of the services and facilities described herein, we shall
be entitled to receive from you, and you agree to pay to us, the fees
described as payable to us in each Fund's Distribution Plan adopted
pursuant to Rule 12b- 1 under the Act, and Prospectus and related Statement
of Additional Information. We understand that any payments pursuant to this
Agreement shall be paid only so long as this Agreement and such Plan are in
effect. We agree that no Director, officer or shareholder of the Fund shall
be liable individually for the performance of the obligations hereunder or
for any such payments.
8. We agree to provide to you and each applicable Fund such information
relating to our services hereunder as may be required to be maintained by
you and/or such Fund under applicable federal or state laws, and the rules,
regulations, requirements or conditions of applicable regulatory and
self-regulatory agencies or authorities.
9. This Agreement shall not constitute either party the legal representative
of the other, nor shall either party have the right or authority to assume,
create or incur any liability or any obligation of any kind, express or
implied, against or in the name of or on behalf of the other party.
10. All notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by personal delivery or by postage
prepaid, registered or certified United States first class mail, return
receipt requested, or by telecopier, telex, telegram or similar means of
same day delivery (with a confirming copy by mail as provided herein).
Unless otherwise notified in writing, all notices to you shall be given or
sent to you at 200 Park Avenue, New York, New York 10166, Attention:
General Counsel, and all notices to us shall be given or sent to us at our
address which shall be furnished to you in writing on or before the
effective date of this Agreement.
11. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principles of conflict of
laws.
APPENDIX D
TO BANK AFFILIATED BROKER-DEALER AGREEMENT
EXPEDITED REDEMPTION INFORMATION FORM
The following information is provided by the Firm identified below which desires
to exercise expedited redemption privileges with respect to shares of certain
mutual funds managed, advised or administered by The Dreyfus Corporation or its
subsidiaries or affiliates, which shares are registered in the name of, or
beneficially owned by, the customers of such Firm.
(PLEASE PRINT OR TYPE)
NAME OF BANK
STREET ADDRESS CITY STATE ZIP CODE
In order to speed payment, redemption proceeds shall be sent only to the
commercial bank identified below, for credit to customer accounts of the
above-named Firm.
NAME OF COMMERCIAL BANK TO RECEIVE ALL PAYMENTS - ABA NUMBER
ACCOUNT NAME ACCOUNT NUMBER
STREET ADDRESS CITY STATE ZIP CODE
BANK AGREEMENT
(Fully Disclosed Basis)
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We are a "bank" (as such term is defined in Section 3(a)(6) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act") ). We desire to make
available to our customers shares of beneficial interest or common stock of
open-end registered investment companies managed, advised or administered by The
Dreyfus Corporation or its subsidiaries or affiliates (hereinafter referred to
individually as a "Fund" and collectively as the "Funds"). You are the principal
underwriter (as such term is defined in the Investment Company Act of 1940, as
amended) of the offering of shares of the Funds and the exclusive agent for the
continuous distribution of such shares pursuant to the terms of a Distribution
Agreement between you and each Fund. Unless the context otherwise requires, as
used herein the term "Prospectus" shall mean the prospectus and related
statement of additional information ("Statement of Additional Information")
incorporated therein by reference (as amended and supplemented) of each of the
respective Funds included in the then currently effective registration statement
(or post-effective amendment thereto) of each such Fund, as filed with the
Securities and Exchange Commission pursuant to the Securities Act of 1933, as
amended (the "Registration Statement").
In consideration for the mutual covenants contained herein, it is hereby agreed
that our respective rights and obligations shall be as follows:
1. With respect to any and all transactions in the shares of any Fund pursuant
to this Agreement, it is understood and agreed in each case that: (a) we
shall be acting solely as agent for the account of our customer; (b) each
transaction shall be initiated solely upon the order of our customer; (c) you
shall execute transactions only upon receiving instructions from us acting as
agent for our customer; (d) as between us and our customer, our customer will
have full beneficial ownership of all Fund shares; and (e) each transaction
shall be for the account of our customer and not for our account. Each
transaction shall be without recourse to us provided that we act in
accordance with the terms of this Agreement. We represent and warrant to you
that (a) we will have full right, power and authority to effect transactions
(including, without limitation, any purchases, exchanges and redemptions) in
Fund shares on behalf of all customer accounts provided by us to you or to
any transfer agent as such term is defined in the Prospectus of each Fund
(the "Transfer Agent"); and (b) we have taken appropriate verification
measures to ensure transactions are in compliance with all applicable laws
and regulations concerning foreign exchange controls and money laundering.
2. All orders for the purchase of any Fund shares shall be executed at the then
current public offering price per share (i.e., the net asset value per share
plus the applicable sales charge, if any) and all orders for the redemption
of any Fund shares shall be executed at the net asset value per share less
the applicable deferred sales charge, redemption fee or similar charge or
fee, if any, in each case as described in the Prospectus of such Fund. The
minimum initial purchase order and minimum subsequent purchase order shall be
as set forth in the Prospectus of such Fund. All orders are subject to
acceptance or rejection by you at your sole discretion. Unless otherwise
mutually agreed in writing, each transaction shall be promptly confirmed in
writing directly to the customer on a fully disclosed basis and a copy of
each confirmation shall be sent simultaneously to us. You reserve the right,
at your discretion and without notice, to suspend the sale of shares or
withdraw entirely the sale of shares of any or all of the Funds.
3. In ordering shares of any Fund, we shall rely solely and conclusively on the
representations contained in the Prospectus of such Fund. We agree that we
shall not make shares of any Fund available to our customers except in
compliance with all applicable federal and state laws, and the rules,
regulations and requirements of applicable regulatory agencies or
authorities. We agree that we shall not purchase any Fund shares, as agent
for any customer, unless we deliver or cause to be delivered to such
customer, at or prior to the time of such purchase, a copy of the Prospectus
of such Fund, or unless such customer has acknowledged receipt of the
Prospectus of such Fund. We further agree to obtain from each customer for
whom we act as agent for the purchase of Fund shares any taxpayer
identification number certification and such other information as may be
required from time to time under the Internal Revenue Code of 1986, as
amended (the "Code"), and the regulations promulgated thereunder, and to
provide you or your designee with timely written notice of any failure to
obtain such taxpayer identification number certification or other information
in order to enable the implementation of any required withholding. We will be
responsible for the proper instruction and training of all sales personnel
employed by us. Unless otherwise mutually agreed in writing, you shall
deliver or cause to be delivered to each of the customers who purchases
shares of any of the Funds through us pursuant to this Agreement copies of
all annual and interim reports, proxy solicitation materials and any other
information and materials relating to such Funds and prepared by or on behalf
of you, the Fund or its investment adviser, custodian, Transfer Agent or
dividend disbursing agent for distribution to each such customer. You agree
to supply us with copies of the Prospectus, Statement of Additional
Information, annual reports, interim reports, proxy solicitation materials
and any such other information and materials relating to each Fund in
reasonable quantities upon request.
4. We shall not make any representations concerning any Fund shares other than
those contained in the Prospectus of such Fund or in any promotional
materials or sales literature furnished to us by you or the Fund. We shall
not furnish or cause to be furnished to any person or display or publish
any information or materials relating to any Fund (including, without
limitation, promotional materials and sales literature, advertisements,
press releases, announcements, statements, posters, signs or other similar
materials), except such information and materials as may be furnished to us
by you or the Fund, and such other information and materials as may be
approved in writing by you. In making Fund shares available to our
customers hereunder, or in providing investment advice regarding such
shares to our customers, we shall at all times act in compliance with the
Interagency Statement on Retail Sales of Nondeposit Investment Products
issued by The Board of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, the Office of the Comptroller of the
Currency, and the Office of Thrift Supervision (February 15, 1994) or any
successor interagency requirements as in force at the time such services
are provided.
5. In determining the amount of any reallowance payable to us hereunder, you
reserve the right to exclude any sales which you reasonably determine are
not made in accordance with the terms of the applicable Fund Prospectuses
or the provisions of this Agreement.
6. (a) In the case of any Fund shares sold with a sales charge, customers may
be entitled to a reduction in sales charge on purchases made under a letter
of intent ("Letter of Intent") in accordance with the Fund Prospectus. In
such case, our reallowance will be paid based upon the reduced sales charge,
but an adjustment will be made as described in the Prospectus of the
applicable Fund to reflect actual purchases of the customer if he should
fail to fulfill his Letter of Intent. The sales charge and/or reallowance
may be changed at any time in your sole discretion upon written notice to
us.
(b) Subject to and in accordance with the terms of the Prospectus of each
Fund sold with a sales charge, a reduced sales charge may be applicable with
respect to customer accounts through a right of accumulation under which
customers are permitted to purchase shares of a Fund at the then current
public offering price per share applicable to the total of (i) the dollar
amount of shares then being purchased plus (ii) an amount equal to the then
current net asset value or public offering price originally paid per share,
whichever is higher, of the customer's combined holdings of the shares of
such Fund and of any other open-end registered investment company as may be
permitted by the applicable Fund Prospectus. In such case, we agree to
furnish to you or the Transfer Agent sufficient information to permit your
confirmation of qualification for a reduced sales charge, and acceptance of
the purchase order is subject to such confirmation.
(c) With respect to Fund shares sold with a sales charge, we agree to advise
you promptly at your request as to amounts of any and all purchases of Fund
shares made by us, as agent for our customers, qualifying for a reduced
sales charge.
(d) Exchanges (i.e., the investment of the proceeds from the liquidation of
shares of one open-end registered investment company managed, advised or
administered by The Dreyfus Corporation or its subsidiaries or affiliates in
the shares of another open-end registered investment company managed,
advised or administered by The Dreyfus Corporation or its subsidiaries or
affiliates) shall, where available, be made subject to and in accordance
with the terms of each Fund's Prospectus.
(e)Unless at the time of transmitting an order we advise you to the
contrary, the shares ordered will be deemed to be the total holdings of the
specified customer.
7. Subject to and in accordance with the terms of each Fund Prospectus and
Service Plan, Shareholder Services Plan, Distribution Plan or other similar
plan, if any, we understand that you may pay to certain financial
institutions, securities dealers and other industry professionals with
which you have entered into an agreement in substantially the form annexed
hereto as Appendix A, B, or C (or such other form as may be approved from
time to time by the board of directors or trustees or managing general
partners of the Fund) such fees as may be determined by you in accordance
with such agreement for shareholder, administrative or distribution-related
services as described therein.
8. The procedures relating to all orders and the handling thereof will be
subject to the terms of the Prospectus of each Fund and your written
instructions to us from time to time. No conditional orders will be
accepted. We agree to place orders with you immediately for the same number
of shares and at the same price as any orders we receive from our
customers. We shall not withhold placing orders received from customers so
as to profit ourselves as a result of such withholding by a change in the
net asset value from that used in determining the offering price to such
customers, or otherwise; provided, however, that the foregoing shall not
prevent the purchase of shares of any Fund by us for our own bona fide
investment. We agree that: (a) we shall not effect any transactions
(including, without limitation, any purchases, exchanges and redemptions)
in any Fund shares registered in the name of, or beneficially owned by, any
customer unless such customer has granted us full right, power and
authority to effect such transactions on such customer's behalf, and (b)
you, each Fund, the Transfer Agent and your and their respective officers,
directors, trustees, managing general partners, agents, employees and
affiliates shall not be liable for, and shall be fully indemnified and held
harmless by us from and against, any and all claims, demands, liabilities
and expenses (including, without limitation, reasonable attorneys' fees)
which may be incurred by you or any of the foregoing persons entitled to
indemnification from us hereunder arising out of or in connection with the
execution of any transactions in Fund shares registered in the name of, or
beneficially owned by, any customer in reliance upon any oral or written
instructions reasonably believed to be genuine and to have been given by or
on behalf of us.
9. (a) We agree to pay for purchase orders of any Fund shares placed by us
in accordance with the terms of the Prospectus of the applicable Fund. On
or before the settlement date of each purchase order for shares of any
Fund, we shall either (i) remit to an account designated by you with the
Transfer Agent an amount equal to the then current public offering price
of the shares of such Fund being purchased less our reallowance, if any,
with respect to such purchase order as determined by you in accordance
with the terms of the applicable Fund Prospectus, or (ii) remit to an
account designated by you with the Transfer Agent an amount equal to the
then current public offering price of the shares of such Fund being
purchased without deduction for our reallowance, if any, with respect to
such purchase order as determined by you in accordance with the terms of
the applicable Fund Prospectus, in which case our reallowance, if any,
shall be payable to us by you on at least a monthly basis. If payment for
any purchase order is not received in accordance with the terms of the
applicable Fund Prospectus, you reserve the right, without notice, to
cancel the sale and to hold us responsible for any loss sustained as a
result
thereof.
(b) If any shares sold to us as agent for our customers under the terms of
this Agreement are sold with a sales charge and are redeemed for the
account of the Fund or are tendered for redemption within seven (7) days
after the date of purchase: (i) we shall forthwith refund to you the full
reallowance received by us on the sale; and (ii) you shall forthwith pay to
the Fund your portion of the sales charge on the sale which had been
retained by you and shall also pay to the Fund the amount refunded by us.
10. Certificates for shares sold to us as agent for our customers hereunder
shall only be issued in accordance with the terms of each Fund's Prospectus
upon our customers' specific request and, upon such request, shall be
promptly delivered to our customers by the Transfer Agent unless other
arrangements are made by us. However, in making delivery of such share
certificates to our customers, the Transfer Agent shall have adequate time
to clear any checks drawn for the payment of Fund shares.
11. We hereby represent and warrant to you that: (a) we are a "bank" as such
term is defined in Section 3(a)(6) of the Exchange Act; (b) we are a duly
organized and validly existing "bank" in good standing under the laws of
the jurisdiction in which we were organized; (c) all authorizations (if
any) required for our lawful execution of this Agreement and our
performance hereunder have been obtained; and (d) upon execution and
delivery by us, and assuming due and valid execution and delivery by you,
this Agreement will constitute a valid and binding agreement, enforceable
against us in accordance with its terms. We agree to give written notice to
you promptly in the event that we shall cease to be a "bank" as such term
is defined in Section 3(a)(6) of the Exchange Act. In such event, this
Agreement shall be automatically terminated upon such written notice.
12. You agree to inform us, upon our request, as to the states in which you
believe the shares of the Funds have been qualified for sale under, or are
exempt from the requirements of, the respective securities laws of such
states, but you shall have no obligation or responsibility as to our right
to make shares of any Funds available to our customers in any jurisdiction.
We agree to comply with all applicable federal and state laws, rules,
regulations and requirements relating to the performance of our duties and
responsibilities hereunder.
13. (a) You agree to indemnify, defend and hold us, our several officers and
directors, and any person who controls us within the meaning of Section 15
of the Securities Act of 1933, as amended, free and harmless from and
against any and all claims, demands, liabilities and expenses (including
the cost of investigating or defending such claims, demands or liabilities
and any counsel fees incurred in connection therewith) which we, our
officers and directors, or any such controlling person, may incur under the
Securities Act of 1933, as amended, or under common law or otherwise,
arising out of or based upon (i) any breach of any representation, warranty
or covenant made by you herein, or (ii) any failure by you to perform your
obligations as set forth herein, or (iii) any untrue statement, or alleged
untrue statement, of a material fact contained in any Registration
Statement or any Prospectus, or arising out of or based upon any omission,
or alleged omission, to state a material fact required to be stated in
either any Registration Statement or any Prospectus, or necessary to make
the statements in any thereof not misleading; provided, however, that your
agreement to indemnify us, our officers and directors, and any such
controlling person shall not be deemed to cover any claims, demands,
liabilities or expenses arising out of any untrue statement or alleged
untrue statement or omission or alleged omission made in any Registration
Statement or Prospectus in reliance upon and in conformity with written
information furnished to you or the Fund by us specifically for use in the
preparation thereof. Your agreement to indemnify us, our officers and
directors, and any such controlling person, as aforesaid, is expressly
conditioned upon your being notified of any action brought against our
officers or directors, or any such controlling person, such notification to
be given by letter or by telecopier, telex, telegram or similar means of
same day delivery received by you at your address as specified in Paragraph
18 of this Agreement within seven (7) days after the summons or other first
legal process shall have been served. The failure so to notify you of any
such action shall not relieve you from any liability which you may have to
the person against whom such action is brought by reason of any such
breach, failure or untrue, or alleged untrue, statement or omission, or
alleged omission, otherwise than on account of your indemnity agreement
contained in this Paragraph 1 3(a). You will be entitled to assume the
defense of any suit brought to enforce any such claim, demand, liability or
expense. In the event that you elect to assume the defense of any such suit
and retain counsel, the defendant or defendants in such suit shall bear the
fees and expenses of any additional counsel retained by any of them; but in
case you do not elect to assume the defense of any such suit, you will
reimburse us, our officers and directors, or any controlling persons named
as defendants in such suit, for the fees and expenses of any counsel
retained by us or them. Your indemnification agreement contained in this
Paragraph 1 3(a) shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of any person entitled
to indemnification pursuant to this Paragraph 13(a), and shall survive the
delivery of any Fund shares and termination of this Agreement. This
agreement of indemnity will inure exclusively to the benefit of the persons
entitled to indemnification from you pursuant to this Agreement and their
respective estates, successors and assigns.
(b) We agree to indemnify, defend and hold you and your several officers
and directors, and each Fund and its several officers and directors or
trustees or managing general partners, and any person who controls you
and/or each Fund within the meaning of Section 15 of the Securities Act of
1933, as amended, free and harmless from and against any and all claims,
demands, liabilities and expenses (including the cost of investigating or
defending such claims, demands or liabilities and any counsel fees incurred
in connection therewith) which you and your several officers and directors,
or the Fund and its officers and directors or trustees or managing general
partners, or any such controlling person, may incur under the Securities
Act of 1933, as amended, or under common law or otherwise, arising out of
or based upon (i) any breach of any representation, warranty or covenant
made by us herein, or (ii) any failure by us to perform our obligations as
set forth herein, or (iii) any untrue, or alleged untrue, statement of a
material fact contained in the information furnished in writing by us to
you or any Fund specifically for use in such Fund's Registration Statement
or Prospectus, or used in the answers to any of the items of the
Registration Statement or in the corresponding statements made in the
Prospectus, or arising out of or based upon any omission, or alleged
omission, to state a material fact in connection with such information
furnished in writing by us to you or the Fund and required to be stated in
such answers or necessary to make such information not misleading. Our
agreement to indemnify you and your officers and directors, and the Fund
and its officers and directors or trustees, and any such controlling
person, as aforesaid, is expressly conditioned upon our being notified of
any action brought against any person or entity entitled to indemnification
hereunder, such notification to be given by letter or by telecopier, telex,
telegram or similar means of same day delivery received by us at our
address as specified in Paragraph 18 of this Agreement within seven (7)
days after the summons or other first legal process shall have been served.
The failure so to notify us of any such action shall not relieve us from
any liability which we may have to you or your officers and directors, or
the Fund or its officers and directors or trustees or managing general
partners, or to any such controlling person, by reason of any such breach,
failure or untrue, or alleged untrue, statement or omission, or alleged
omission, otherwise than on account of our indemnity agreement contained in
this Paragraph 13(b). Our indemnification agreements contained in Paragraph
8 above, Paragraph 16 below and this Paragraph 13(b) shall remain operative
and in full force and effect regardless of any investigation made by or on
behalf of any person entitled to indemnification pursuant to Paragraph 8
above, Paragraph 16 below or this Paragraph 13(b), and shall survive the
delivery of any Fund shares and termination of this Agreement. Such
agreements of indemnity will inure exclusively to the benefit of the
persons entitled to indemnification hereunder and their respective estates,
successors and assigns.
14. The names and addresses and other information concerning our customers are
and shall remain our sole property, and neither you nor your affiliates
shall use such names, addresses or other information for any purpose except
in connection with the performance of your duties and responsibilities
hereunder and except for servicing and informational mailings relating to
the Funds. Notwithstanding the foregoing, this Paragraph 14 shall not
prohibit you or any of your affiliates from utilizing for any purpose the
names, addresses or other information concerning any of our customers if
such names, addresses or other information are obtained in any manner other
than from us pursuant to this Agreement. The provisions of this Paragraph
14 shall survive the termination of this Agreement.
15. We agree to serve as a service agent, in accordance with the terms of the
Form of Service Agreement annexed hereto as Appendix A, Form of Shareholder
Services Agreement annexed hereto as Appendix B, and/or Form of
Distribution Plan Agreement annexed hereto as Appendix C, as applicable,
for all of our customers who purchase shares of any and all Funds whose
Prospectuses provide therefor. By executing this Agreement, each of the
parties hereto agrees to be bound by all terms, conditions, rights and
obligations set forth in the forms of agreements annexed hereto and further
agrees that such forms of agreement supersede any and all prior service
agreements or other similar agreements between the parties hereto, relating
to any Fund or Funds. It is recognized that certain parties may not be
permitted to collect distribution fees under the Form of Distribution Plan
Agreement annexed hereto, and if we are such a party, we will not collect
such fees.
16. By completing the Expedited Redemption Information Form annexed hereto as
Appendix D, we agree that you, each Fund with respect to which you permit
us to exercise an expedited redemption privilege, the Transfer Agent of
each such Fund, and your and their respective officers, directors or
trustees or managing general partners, agents, employees and affiliates
shall not be liable for and shall be fully indemnified and held harmless by
us from and against any and all claims, demands, liabilities and expenses
(including, without limitation, reasonable attorneys' fees) arising out of
or in connection with any expedited redemption payments made in reliance
upon the information set forth in such Appendix D.
17. Neither this Agreement nor the performance of the services of the
respective parties hereunder shall be considered to constitute an exclusive
arrangement, or to create a partnership, association or joint venture
between you and us. Neither party hereto shall be, act as, or represent
itself as, the agent or representative of the other, nor shall either party
have the right or authority to assume, create or incur any liability or any
obligation of any kind, express or implied, against or in the name of, or
on behalf of, the other party. This Agreement is not intended to, and shall
not, create any rights against either party hereto by any third party
solely on account of this Agreement. Neither party hereto shall use the
name of the other party in any manner without the other party's prior
written consent, except as required by any applicable federal or state law,
rule, regulation or requirement, and except pursuant to any promotional
programs mutually agreed upon in writing by the parties hereto.
18. Except as otherwise specifically provided herein, all notices required or
permitted to be given pursuant to this Agreement shall be given in writing
and delivered by personal delivery or by postage prepaid, registered or
certified United States first class mail, return receipt requested, or by
telecopier, telex, telegram or similar means of same day delivery (with a
confirming copy by mail as provided herein). Unless otherwise notified in
writing, all notices to you shall be given or sent to you at your offices,
located at 200 Park Avenue, New York, New York 10166, Attention: General
Counsel, and all notices to us shall be given or sent to us at our address
shown below.
19. This Agreement shall become effective only when accepted and signed by you,
and may be terminated at any time by either party hereto upon 15 days'
prior written notice to the other party. This Agreement may be amended by
you upon 15 days' prior written notice to us, and such amendment shall be
deemed accepted by us upon the placement of any order for the purchase of
Fund shares or the acceptance of a fee payable under this Agreement,
including the Appendices hereto, after the effective date of any such
amendment. This Agreement may not be assigned by us without your prior
written consent. This Agreement constitutes the entire agreement and
understanding between the parties hereto relating to the subject matter
hereof and supersedes any and all prior agreements between the parties
hereto relating to the subject matter hereof.
20. This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York, without giving effect to principles
of conflicts of laws.
Very truly yours,
Firm Name (Please Print or Type)
Address
Date: By:
------------------
Authorized Signature
NOTE: Please sign and return both copies of this Agreement to Dreyfus
Service Corporation. Upon acceptance one countersigned copy will be returned to
you for your files.
Accepted:
DREYFUS SERVICE CORPORATION
Date: By:
------------------
Authorized Signature
APPENDIX A
TO BANK AGREEMENT
FORM OF SERVICE AGREEMENT
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We wish to enter into an Agreement with you for servicing shareholders of, and
administering shareholder accounts in, certain mutual fund(s) managed, advised
or administered by The Dreyfus Corporation or its subsidiaries or affiliates
(hereinafter referred to individually as the "Fund" and collectively as the
"Funds"). You are the principal underwriter as defined in the Investment Company
Act of 1940, as amended (the "Act"), and the exclusive agent for the continuous
distribution of shares of the Funds.
The terms and conditions of this Agreement are as follows:
1. We agree to provide shareholder and administrative services for our clients
who own shares of the Funds ("clients"), which services may include,
without limitation: assisting clients in changing dividend options, account
designations and addresses; performing sub-accounting; establishing and
maintaining shareholder accounts and records; processing purchase and
redemption transactions; providing periodic statements and/or reports
showing a client's account balance and integrating such statements with
those of other transactions and balances in the client's other accounts
serviced by us; arranging for bank wires; and providing such other
information and services as you reasonably may request, to the extent we
are permitted by applicable statute, rule or regulation. In this regard, if
we are a federally chartered and supervised bank or other banking
organization, you recognize that we may be subject to the provisions of the
Glass-Steagall Act and other laws, rules, regulations or requirements
governing, among other things, the conduct of our activities. As such, we
are restricted in the activities we may undertake and for which we may be
paid and, therefore, intend to perform only those activities as are
consistent with our statutory and regulatory obligations. We represent and
warrant to, and agree with you, that the compensation payable to us
hereunder, together with any other compensation payable to us by clients in
connection with the investment of their assets in shares of the Funds, will
be properly disclosed by us to our clients.
2. We shall provide such office space and equipment, telephone facilities and
personnel (which may be all or any part of the space, equipment and
facilities currently used in our business, or all or any personnel employed
by us) as is necessary or beneficial for providing information and services
to each Fund's shareholders, and to assist you in servicing accounts of
clients. We shall transmit promptly to clients all communications sent to
us for transmittal to clients by or on behalf of you, any Fund, or any
Fund's investment adviser, custodian or transfer or dividend disbursing
agent.
3. We agree that neither we nor any of our employees or agents are authorized
to make any representation concerning shares of any Fund, except those
contained in the then current Prospectus for such Fund, copies of which
will be supplied by you to us in reasonable quantities upon request. If we
are a federally supervised bank or thrift institution, we agree that, in
providing services hereunder, we shall at all times act in compliance with
the Interagency Statement on Retail Sales of Nondeposit Investment Products
issued by The Board of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, the Office of the Comptroller of the
Currency, and the Office of Thrift Supervision (February 15, 1994) or any
successor interagency requirements as in force at the time such services
are provided. We shall have no authority to act as agent for the Funds or
for you.
4. You reserve the right, at your discretion and without notice, to suspend
the sale of shares or withdraw the sale of shares of any or all of the
Funds.
5. We acknowledge that this Agreement shall become effective for a Fund only
when approved by vote of a majority of (i) the Fund's Board of Directors or
Trustees or Managing General Partners, as the case may be (collectively
"Directors," individually "Director"), and (ii) Directors who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such approval.
6. This Agreement shall continue until the last day of the calendar year next
following the date of execution, and thereafter shall continue
automatically for successive annual periods ending on the last day of each
calendar year. For all Funds as to which Board approval of this Agreement
is required, such continuance must be approved specifically at least
annually by a vote of a majority of (i) the Fund's Board of Directors and
(ii) Directors who are not "interested persons" (as defined in the Act) of
the Fund and have no direct or indirect financial interest in this
Agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval. For any Fund as to which Board approval of this
Agreement is required, this Agreement is terminable without penalty, at any
time, by a majority of the Fund's Directors who are not "interested
persons" (as defined in the Act) and have no direct or indirect financial
interest in this Agreement or upon not more than 60 days' written notice,
by vote of holders of a majority of the Fund's shares. As to all Funds,
this Agreement is terminable without penalty upon 15 days' notice by either
party. In addition, you may terminate this Agreement as to any or all Funds
immediately, without penalty, if the present investment adviser of such
Fund(s) ceases to serve the Fund(s) in such capacity, or if you cease to
act as distributor of such Fund(s). Notwithstanding anything contained
herein, if we fail to perform the shareholder servicing and administrative
functions contemplated herein by you as to any or all of the Funds, this
Agreement shall be terminable effective upon receipt of notice thereof by
us. This Agreement also shall terminate automatically in the event of its
assignment (as defined in the Act).
7. In consideration of the services and facilities described herein, we shall
be entitled to receive from you, and you agree to pay to us, the fees
described as payable to us in each Fund's Service Plan adopted pursuant to
Rule 12b-1 under the Act, and Prospectus and related Statement of
Additional Information. We understand that any payments pursuant to this
Agreement shall be paid only so long as this Agreement and such Plan are in
effect. We agree that no Director, officer or shareholder of the Fund shall
be liable individually for the performance of the obligations hereunder or
for any such payments.
8. We agree to provide to you and each applicable Fund such information
relating to our services hereunder as may be required to be maintained by
you and/or such Fund under applicable federal or state laws, and the rules,
regulations, requirements or conditions of applicable regulatory and
self-regulatory agencies or authorities.
9. This Agreement shall not constitute either party the legal representative
of the other, nor shall either party have the right or authority to assume,
create or incur any liability or any obligation of any kind, express or
implied, against or in the name of or on behalf of the other party.
10. All notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by personal delivery or by postage
prepaid, registered or certified United States first class mail, return
receipt requested, or by telecopier, telex, telegram or similar means of
same day delivery (with a confirming copy by mail as provided herein).
Unless otherwise notified in writing, all notices to you shall be given or
sent to you at 200 Park Avenue, New York, New York 10166, Attention:
General Counsel, and all notices to us shall be given or sent to us at our
address which shall be furnished to you in writing on or before the
effective date of this Agreement.
11. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principles of conflict of
laws.
APPENDIX B
TO BANK AGREEMENT
FORM OF SHAREHOLDER SERVICES AGREEMENT
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We wish to enter into an Agreement with you for servicing shareholders of, and
administering shareholder accounts in, certain mutual fund(s) managed, advised
or administered by The Dreyfus Corporation or its subsidiaries or affiliates
(hereinafter referred to individually as the "Fund" and collectively as the
"Funds"). You are the principal underwriter as defined in the Investment Company
Act of 1940, as amended (the "Act"), and the exclusive agent for the continuous
distribution of shares of the Funds.
The terms and conditions of this Agreement are as follows:
1. We agree to provide shareholder and administrative services for our clients
who own shares of the Funds ("clients"), which services may include,
without limitation: assisting clients in changing dividend options, account
designations and addresses; performing sub-accounting; establishing and
maintaining shareholder accounts and records; processing purchase and
redemption transactions; providing periodic statements and/or reports
showing a client's account balance and integrating such statements with
those of other transactions and balances in the client's other accounts
serviced by us; arranging for bank wires; and providing such other
information and services as you reasonably may request, to the extent we
are permitted by applicable statute, rule or regulation. In this regard, if
we are a federally chartered and supervised bank or other banking
organization, you recognize that we may be subject to the provisions of the
Glass-Steagall Act and other laws, rules, regulations, or requirements
governing, among other things, the conduct of our activities. As such, we
are restricted in the activities we may undertake and for which we may be
paid and, therefore, intend to perform only those activities as are
consistent with our statutory and regulatory obligations. We represent and
warrant to, and agree with you, that the compensation payable to us
hereunder, together with any other compensation payable to us by clients in
connection with the investment of their assets in shares of the Funds, will
be properly disclosed by us to our clients, will be authorized by our
clients and will not result in an excessive or unauthorized fee to us.
2. We shall provide such office space and equipment, telephone facilities and
personnel (which may be all or any part of the space, equipment and
facilities currently used in our business, or all or any personnel employed
by us) as is necessary or beneficial for providing information and services
to each Fund's shareholders, and to assist you in servicing accounts of
clients. We shall transmit promptly to clients all communications sent to
us for transmittal to clients by or on behalf of you, any Fund, or any
Fund's investment adviser, custodian or transfer or dividend disbursing
agent. We agree that in the event an issue pertaining to a Fund's
Shareholder Services Plan is submitted for shareholder approval, we will
vote any Fund shares held for our own account in the same proportion as the
vote of those shares held for our clients' accounts.
3. We agree that neither we nor any of our employees or agents are authorized
to make any representation concerning shares of any Fund, except those
contained in the then current Prospectus for such Fund, copies of which
will be supplied by you to us in reasonable quantities upon request. If we
are a federally supervised bank or thrift institution, we agree that, in
providing services hereunder, we shall at all times act in compliance with
the Interagency Statement on Retail Sales of Nondeposit Investment Products
issued by The Board of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, the Office of the Comptroller of the
Currency, and the Office of Thrift Supervision (February 15, 1994) or any
successor interagency requirements as in force at the time such services
are provided. We shall have no authority to act as agent for the Funds or
for you.
4. You reserve the right, at your discretion and without notice, to suspend
the sale of shares or withdraw the sale of shares of any or all of the
Funds.
5. We acknowledge that this Agreement shall become effective for a Fund only
when approved by vote of a majority of (i) the Fund's Board of Directors or
Trustees or Managing General Partners, as the case may be (collectively
"Directors," individually "Director"), and (ii) Directors who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such approval.
6. This Agreement shall continue until the last day of the calendar year next
following the date of execution, and thereafter shall continue
automatically for successive annual periods ending on the last day of each
calendar year. Such continuance must be approved specifically at least
annually by a vote of a majority of (i) the Fund's Board of Directors and
(ii) Directors who are not "interested persons" (as defined in the Act) of
the Fund and have no direct or indirect financial interest in this
Agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval. This Agreement is terminable without penalty, at
any time, by a majority of the Fund's Directors who are not "interested
persons" (as defined in the Act) and have no direct or indirect financial
interest in this Agreement. This Agreement is terminable without penalty
upon 15 days' notice by either party. In addition, you may terminate this
Agreement as to any or all Funds immediately, without penalty, if the
present investment adviser of such Fund(s) ceases to serve the Fund(s) in
such capacity, or if you cease to act as distributor of such Fund(s).
Notwithstanding anything contained herein, if we fail to perform the
shareholder servicing and administrative functions contemplated herein by
you as to any or all of the Funds, this Agreement shall be terminable
effective upon receipt of notice thereof by us. This Agreement also shall
terminate automatically in the event of its assignment (as defined in the
Act).
7. In consideration of the services and facilities described herein, we shall
be entitled to receive from you, and you agree to pay to us, the fees
described as payable to us in each Fund's Shareholder Services Plan and
Prospectus and related Statement of Additional Information. We understand
that any payments pursuant to this Agreement shall be paid only so long as
this Agreement and such Plan are in effect. We agree that no Director,
officer or shareholder of the Fund shall be liable individually for the
performance of the obligations hereunder or for any such payments.
8. We agree to provide to you and each applicable Fund such information
relating to our services hereunder as may be required to be maintained by
you and/or such fund under applicable federal or state laws, and the rules,
regulations, requirements or conditions of applicable regulatory and
self-regulatory agencies or authorities.
9. This Agreement shall not constitute either party the legal representative
of the other, nor shall either party have the right or authority to assume,
create or incur any liability or any obligation of any kind, express or
implied, against or in the name of or on behalf of the other party.
10. All notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by personal delivery or by postage
prepaid, registered or certified United States first class mail, return
receipt requested, or by telecopier, telex, telegram or similar means of
same day delivery (with a confirming copy by mail as provided herein).
Unless otherwise notified in writing, all notices to you shall be given or
sent to you at 200 Park Avenue, New York, New York 10166, Attention:
General Counsel, and all notices to us shall be given or sent to us at our
address which shall be furnished to you in writing on or before the
effective date of this Agreement.
11. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principle s of conflict of
laws.
APPENDIX C
TO BANK AGREEMENT
FORM OF DISTRIBUTION PLAN AGREEMENT
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We wish to enter into an Agreement with you with respect to our providing
distribution assistance relating to shares of certain mutual fund(s) managed,
advised or administered by The Dreyfus Corporation or its subsidiaries or
affiliates (hereinafter referred to individually as the "Fund" and collectively
as the "Funds"). You are the principal underwriter as defined in the Investment
Company Act of 1940, as amended (the "Act"), and the exclusive agent for the
continuous distribution of shares of the Funds.
The terms and conditions of this Agreement are as follows:
1. We agree to provide distribution assistance in connection with the sale of
the shares of the Funds. In this regard, if we are a federally chartered
and supervised bank or other banking organization, you recognize that we
may be subject to the provisions of the Glass-Steagall Act and other laws,
rules, regulations or requirements governing, among other things, the
conduct of our activities. As such, we are restricted in the activities we
may undertake and for which we may be paid and, therefore, intend to
perform only those activities as are consistent with our statutory and
regulatory obligations. We represent and warrant to, and agree with you,
that the compensation payable to us hereunder, together with any other
compensation payable to us by clients in connection with the investment of
their assets in shares of the Funds, will be properly disclosed by us to
our clients.
2. We shall provide such office space and equipment, telephone facilities and
personnel (which may be all or any part of the space, equipment and
facilities currently used in our business, or all or any personnel employed
by us) as is necessary or beneficial for providing services hereunder. We
shall transmit promptly to clients all communications sent to us for
transmittal to clients by or on behalf of you, any Fund, or any Fund's
investment adviser, custodian or transfer or dividend disbursing agent.
3. We agree that neither we nor any of our employees or agents are authorized
to make any representation concerning shares of any Fund, except those
contained in the then current Prospectus for such Fund, copies of which
will be supplied by you to us in reasonable quantities upon request. If we
are a federally supervised bank or thrift institution, we agree that, in
providing services hereunder, we shall at all times act in compliance with
the Interagency Statement on Retail Sales of Nondeposit Investment Products
issued by The Board of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, the Office of the Comptroller of the
Currency, and the Office of Thrift Supervision (February 15, 1994) or any
successor interagency requirements as in force at the time such services
are provided. We shall have no authority to act as agent for the Funds or
for you.
4. You reserve the right, at your discretion and without notice, to suspend
the sale of shares or withdraw the sale of shares of any or all of the
Funds.
5. We acknowledge that this Agreement shall become effective for a Fund only
when approved by vote of a majority of (i) the Fund's Board of Directors or
Trustees or Managing General Partners, as the case may be (collectively
"Directors," individually "Director"), and (ii) Directors who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such approval.
6. This Agreement shall continue until the last day of the calendar year next
following the date of execution, and thereafter shall continue
automatically for successive annual periods ending on the last day of each
calendar year. Such continuance must be approved specifically at least
annually by a vote of a majority of (i) the Fund's Board of Directors and
(ii) Directors who are not "interested persons" (as defined in the Act) of
the Fund and have no direct or indirect financial interest in this
Agreement, by vote cast in person at a meeting called for the purpose of
voting on such approval. This Agreement is terminable without penalty, at
any time, by a majority of the Fund's Directors who are not "interested
persons" (as defined in the Act) and have no direct or indirect financial
interest in this Agreement or, upon not more than 60 days' written notice,
by vote of holders of a majority of the Fund's shares. This Agreement is
terminable without penalty upon 15 days' notice by either party. In
addition, you may terminate this Agreement as to any or all Funds
immediately, without penalty, if the present investment adviser of such
Fund(s) ceases to serve the Fund(s) in such capacity, or if you cease to
act as distributor of such Fund(s). Notwithstanding anything contained
herein, if we fail to perform the distribution functions contemplated
herein by you as to any or all of the Funds, this Agreement shall be
terminable effective upon receipt of notice thereof by us. This Agreement
also shall terminate automatically in the event of its assignment (as
defined in the Act).
7. In consideration of the services and facilities described herein, we shall
be entitled to receive from you, and you agree to pay to us, the fees
described as payable to us in each Fund's Distribution Plan adopted
pursuant to Rule 12b- 1 under the Act, and Prospectus and related Statement
of Additional Information. We understand that any payments pursuant to this
Agreement shall be paid only so long as this Agreement and such Plan are in
effect. We agree that no Director, officer or shareholder of the Fund shall
be liable individually for the performance of the obligations hereunder or
for any such payments.
8. We agree to provide to you and each applicable Fund such information
relating to our services hereunder as may be required to be maintained by
you and/or such Fund under applicable federal or state laws, and the rules,
regulations, requirements or conditions of applicable regulatory and
self-regulatory agencies or authorities.
9. This Agreement shall not constitute either party the legal representative
of the other, nor shall either party have the right or authority to assume,
create or incur any liability or any obligation of any kind, express or
implied, against or in the name of or on behalf of the other party.
10. All notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by personal delivery or by postage
prepaid, registered or certified United States first class mail, return
receipt requested, or by telecopier, telex, telegram or similar means of
same day delivery (with a confirming copy by mail as provided herein).
Unless otherwise notified in writing, all notices to you shall be given or
sent to you at 200 Park Avenue, New York, New York 10166, Attention:
General Counsel, and all notices to us shall be given or sent to us at our
address which shall be furnished to you in writing on or before the
effective date of this Agreement.
11. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principles of conflict of
laws.
APPENDIX D
TO BANK AGREEMENT
EXPEDITED REDEMPTION INFORMATION FORM
The following information is provided by the Bank identified below which desires
to exercise expedited redemption privileges with respect to shares of certain
mutual funds managed, advised or administered by The Dreyfus Corporation or its
affiliates, which shares are registered in the name of, or beneficially owned
by, the customers of such Bank.
(PLEASE PRINT OR TYPE)
NAME OF BANK
STREET ADDRESS CITY STATE ZIP CODE
In order to speed payment, redemption proceeds shall be sent only to the
commercial bank identified below, for credit to customer accounts of the
above-named Firm.
NAME OF COMMERCIAL BANK TO RECEIVE ALL PAYMENTS - ABA NUMBER
ACCOUNT NAME ACCOUNT NUMBER
STREET ADDRESS CITY STATE ZIP CODE
BROKER-DEALER AGREEMENT
(FULLY DISCLOSED BASIS)
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We desire to enter into an Agreement with you for the sale of shares of
beneficial interest or common stock of open-end registered investment companies
managed, advised or administered by The Dreyfus Corporation or its subsidiaries
or affiliates (hereinafter referred to individually as a "Fund" and collectively
as the "Funds"), for which you are the principal underwriter, as such term is
defined in the Investment Company Act of 1940, as amended, and for which you are
the exclusive agent for the continuous distribution of shares pursuant to the
terms of a Distribution Agreement between you and each Fund. Unless the context
otherwise requires, as used herein the term "Prospectus" shall mean the
prospectus and related statement of additional information (the "Statement of
Additional Information") incorporated therein by reference (as amended or
supplemented) of each of the respective Funds included in the then currently
effective registration statement (or post-effective amendment thereto) of each
such Fund, as filed with the Securities and Exchange Commission pursuant to the
Securities Act of 1933, as amended (the "Registration Statement").
In consideration for the mutual covenants contained herein, it is hereby agreed
that our respective rights and obligations shall be as follows:
1. In all sales of Fund shares to the public, we shall act as dealer for our
own account and in no transaction shall we have any authority to act as
agent for any Fund, for you or for any other dealer.
2. All orders for the purchase of any Fund shares shall be executed at the
then current public offering price per share (i.e., the net asset value
per share plus the applicable sales charge, if any) and all orders for
the redemption of any Fund shares shall be executed at the net asset
value per share, less the applicable deferred sales charge, redemption
fee, or similar charge or fee, if any, in each case as described in the
Prospectus of such Fund. The minimum initial purchase order and minimum
subsequent purchase order shall be as set forth in the Prospectus of
such Fund. All orders are subject to acceptance or rejection by you at
your sole discretion. Unless otherwise mutually agreed in writing, each
transaction shall be promptly confirmed in writing directly to the
customer on a fully disclosed basis and a copy of each confirmation
shall be sent simultaneously to us. You reserve the right, at your
discretion and without notice, to suspend the sale of shares or withdraw
entirely the sale of shares of any or all of the Funds. We warrant and
represent that we have taken appropriate verification measures to ensure
transactions are in compliance with all applicable laws and regulations
concerning foreign exchange controls and money laundering.
3. In ordering shares of any Fund, we shall rely solely and conclusively
on the representations contained in the Prospectus of such Fund. We
agree that we shall not offer or sell shares of any Fund except in
compliance with all applicable federal and state securities laws, and
the rules, regulations, requirements and conditions of all applicable
regulatory and self-regulatory agencies or authorities. In connection
with offers to sell and sales of shares of each Fund, we agree to
deliver or cause to be delivered to each person to whom any such offer
or sale is made, at or prior to the time of such offer or sale, a copy
of the Prospectus and, upon request, the Statement of Additional
Information of such Fund. We further agree to obtain from each customer
to whom we sell Fund shares any taxpayer identification number
certification and such other information as may be required from time to
time under the Internal Revenue Code of 1986, as amended (the "Code"),
and the regulations promulgated thereunder, and to provide you or your
designee with timely written notice of any failure to obtain such
taxpayer identification number certification or other information in
order to enable the implementation of any required withholding. We will
be responsible for the proper instruction and training of all sales
personnel employed by us. Unless otherwise mutually agreed in writing,
you shall deliver or cause to be delivered to each of the customers who
purchases shares of any of the Funds from or through us pursuant to this
Agreement copies of all annual and interim reports, proxy solicitation
materials and any other information and materials relating to such Funds
and prepared by or on behalf of you, the Fund or its investment adviser,
custodian, transfer agent or dividend disbursing agent for distribution
to each such customer. You agree to supply us with copies of the
Prospectus, Statement of Additional Information, annual reports, interim
reports, proxy solicitation materials and any such other information and
materials relating to each Fund in reasonable quantities upon request.
4. We shall not make any representations concerning any Fund shares other
than those contained in the Prospectus of such Fund or in any
promotional materials or sales literature furnished to us by you or the
Fund. We shall not furnish or cause to be furnished to any person or
display or publish any information or materials relating to any Fund
(including, without limitation, promotional materials and sales
literature, advertisements, press releases, announcements, statements,
posters, signs or other similar materials), except such information and
materials as may be furnished to us by you or the Fund, and such other
information and materials as may be approved in writing by you.
5. In determining the amount of any dealer reallowance payable to us
hereunder, you reserve the right to exclude any sales which you reasonably
determine are not made in accordance with the terms of the applicable Fund
Prospectuses or the provisions of this Agreement.
6. (a) In the case of any Fund shares sold with a sales charge, customers
may be entitled to a reduction in the sales charge on purchases made
under a letter of intent ("Letter of Intent") in accordance with the
Fund Prospectus. In such a case, our dealer reallowance will be paid
based upon the reduced sales charge, but an adjustment to the dealer
reallowance will be made in accordance with the Prospectus of the
applicable Fund to reflect actual purchases of the customer if such
customer's Letter of Intent is not fulfilled. The sales charge and/or
dealer reallowance may be changed at any time in your sole discretion
upon written notice to us.
(b) Subject to and in accordance with the terms of the Prospectus of each
Fund sold with a sales charge, a reduced sales charge may be applicable
with respect to customer accounts through a right of accumulation under
which customers are permitted to purchase shares of a Fund at the then
current public offering price per share applicable to the total of (i) the
dollar amount of shares then being purchased plus (ii) an amount equal to
the then current net asset value or public offering price originally paid
per share, whichever is higher, of the customer's combined holdings of the
shares of such Fund and of any other open-end registered investment company
as may be permitted by the applicable Fund Prospectus. In such case, we
agree to furnish to you or the transfer agent, as such term is defined in
the Prospectus of each Fund (the "Transfer Agent"), sufficient information
to permit your confirmation of qualification for a reduced sales charge,
and acceptance of the purchase order is subject to such confirmation.
(c) With respect to Fund shares sold with a sales charge, we agree to
advise you promptly at your request as to amounts of any and all sales by
us to the public qualifying for a reduced sales charge.
(d) Exchanges (i.e., the investment of the proceeds from the liquidation of
shares of one open-end registered investment company managed, advised or
administered by The Dreyfus Corporation or its subsidiaries or affiliates
in the shares of another open-end registered investment company managed,
advised or administered by The Dreyfus Corporation or its subsidiaries or
affiliates) shall, where available, be made subject to and in accordance
with the terms of each relevant Fund's Prospectus.
(e) Unless at the time of transmitting an order we advise you or the
Transfer Agent to the contrary, the shares ordered will be deemed to be the
total holdings of the specified customer.
7. Subject to and in accordance with the terms of each Fund Prospectus and
Service Plan, Shareholder Services Plan, Distribution Plan or similar
plan, if any, we understand that you may pay to certain financial
institutions, securities dealers and other industry professionals with
which you have entered into an agreement in substantially the form
annexed hereto as Appendix A, B or C (or such other form as may be
approved from time to time by the board of directors, trustees or
managing general partners of the Fund) such fees as may be determined by
you in accordance with such agreement for shareholder, administrative or
distribution-related services as described therein.
8. The procedures relating to all orders and the handling thereof will be
subject to the terms of the Prospectus of each Fund and your written
instructions to us from time to time. No conditional orders will be
accepted. We agree to place orders with you immediately for the same
number of shares and at the same price as any orders we receive from our
customers. We shall not withhold placing orders received from customers
so as to profit ourselves as a result of such withholding by a change in
the net asset value from that used in determining the offering price to
such customers, or otherwise. We agree that: (a) we shall not effect any
transactions (including, without limitation, any purchases, exchanges
and redemptions) in any Fund shares registered in the name of, or
beneficially owned by, any customer unless such customer has granted us
full right, power and authority to effect such transactions on such
customer's behalf, and (b) you, each Fund, the Transfer Agent and your
and their respective officers, directors, trustees, managing general
partners, agents, employees and affiliates shall not be liable for, and
shall be fully indemnified and held harmless by us from and against, any
and all claims, demands, liabilities and expenses (including, without
limitation, reasonable attorneys' fees) which may be incurred by you or
any of the foregoing persons entitled to indemnification from us
hereunder arising out of or in connection with the execution of any
transactions in Fund shares registered in the name of, or beneficially
owned by, any customer in reliance upon any oral or written instructions
reasonably believed to be genuine and to have been given by or on behalf
of us.
9. (a) We agree to pay for purchase orders for Fund shares placed by us in
accordance with the terms of the Prospectus of the applicable Fund. On
or before the settlement date of each purchase order for shares of any
Fund, we shall either (i) remit to an account designated by you with the
Transfer Agent an amount equal to the then current public offering price
of the shares of such Fund being purchased less our dealer reallowance,
if any, with respect to such purchase order as determined by you in
accordance with the terms of the applicable Fund Prospectus, or (ii)
remit to an account designated by you with the Transfer Agent an amount
equal to the then current public offering price of the shares of such
Fund being purchased without deduction for our dealer reallowance, if
any, with respect to such purchase order as determined by you in
accordance with the terms of the applicable Fund Prospectus, in which
case our dealer reallowance, if any, shall be payable to us on at least
a monthly basis. If payment for any purchase order is not received in
accordance with the terms of the applicable Fund Prospectus, you reserve
the right, without notice, to cancel the sale and to hold us responsible
for any loss sustained as a result thereof.
(b) If any shares sold to us under the terms of this Agreement are sold
with a sales charge and are redeemed for the account of the Fund or are
tendered for redemption within seven (7) business days after the date of
purchase: (i) we shall forthwith refund to you the full dealer reallowance
received by us on the sale; and (ii) you shall forthwith pay to the Fund
your portion of the sales charge on the sale which had been retained by you
and shall also pay to the Fund the amount refunded by us.
10. Certificates for shares sold to us hereunder shall only be issued in
accordance with the terms of each Fund's Prospectus upon our customer's
specific request and, upon such request, shall be promptly delivered to us
by the Transfer Agent unless other arrangements are made by us. However, in
making delivery of such share certificates to us, the Transfer Agent shall
have adequate time to clear any checks drawn for the payment of Fund
shares.
11. Each party hereby represents and warrants to the other party that: (a) it
is a corporation, partnership or other entity duly organized and validly
existing in good standing under the laws of the jurisdiction in which it
was organized; (b) it is duly registered as a broker-dealer with the
Securities and Exchange Commission and, to the extent required, with
applicable state agencies or authorities having jurisdiction over
securities matters, and it is a member of the National Association of
Securities Dealers, Inc. (the "NASD"); (c) it will comply with all
applicable federal and state laws, and the rules, regulations, requirements
and conditions of all applicable regulatory and self-regulatory agencies or
authorities in the performance of its duties and responsibilities
hereunder; (d) the execution and delivery of this Agreement and the
performance of the transactions contemplated hereby have been duly
authorized by all necessary action, and all other authorizations and
approvals (if any) required for its lawful execution and delivery of this
Agreement and its performance hereunder have been obtained; and (e) upon
execution and delivery by it, and assuming due and valid execution and
delivery by the other party, this Agreement will constitute a valid and
binding agreement, enforceable in accordance with its terms. Each party
agrees to provide the other party with such information and access to
appropriate records as may be reasonably required to verify its compliance
with the provisions of this Agreement.
12. You agree to inform us, upon our request, as to the states in which you
believe the shares of the Funds have been qualified for sale under, or are
exempt from the requirements of, the respective securities laws of such
states, but you shall have no obligation or responsibility as to our right
to sell shares in any jurisdiction. We agree to notify you immediately in
the event of (a) our expulsion or suspension from the NASD, or (b) our
violation of any applicable federal or state law, rule, regulation,
requirement or condition arising out of or in connection with this
Agreement, or which may otherwise affect in any material way our ability to
act as a dealer in accordance with the terms of this Agreement. Our
expulsion from the NASD will automatically terminate this Agreement
immediately without notice. Our suspension from the NASD for violation of
any applicable federal or state law, rule, regulation, requirement or
condition will terminate this Agreement effective immediately upon your
written notice of termination to us.
13. (a) You agree to indemnify, defend and hold us, our several officers and
directors, and any person who controls us within the meaning of Section 15
of the Securities Act of 1933, as amended, free and harmless from and
against any and all claims, demands, liabilities and expenses (including
the cost of investigating or defending such claims, demands or liabilities
and any counsel fees incurred in connection therewith) which we, our
officers and directors, or any such controlling person, may incur under the
Securities Act of 1933, as amended, or under common law or otherwise,
arising out of or based upon (i) any breach of any representation, warranty
or covenant made by you herein, or (ii) any failure by you to perform your
obligations as set forth herein, or (iii) any untrue statement, or alleged
untrue statement, of a material fact contained in any Registration
Statement or any Prospectus, or arising out of or based upon any omission,
or alleged omission, to state a material fact required to be stated in
either any Registration Statement or any Prospectus, or necessary to make
the statements in any thereof not misleading; provided, however, that your
agreement to indemnify us, our officers and directors, and any such
controlling person shall not be deemed to cover any claims, demands,
liabilities or expenses arising out of any untrue statement or alleged
untrue statement or omission or alleged omission made in any Registration
Statement or Prospectus in reliance upon and in conformity with written
information furnished to you or the Fund by us specifically for use in the
preparation thereof. Your agreement to indemnify us, our officers and
directors, and any such controlling person, as aforesaid, is expressly
conditioned upon your being notified of any action brought against our
officers or directors, or any such controlling person, such notification to
be given by letter or by telecopier, telex, telegram or similar means of
same day delivery received by you at your address as specified in Paragraph
18 of this Agreement within seven (7) days after the summons or other first
legal process shall have been served. The failure so to notify you of any
such action shall not relieve you from any liability which you may have to
the person against whom such action is brought by reason of any such
breach, failure or untrue, or alleged untrue, statement or omission, or
alleged omission, otherwise than on account of your indemnity agreement
contained in this Paragraph 13(a). You will be entitled to assume the
defense of any suit brought to enforce any such claim, demand, liability or
expense. In the event that you elect to assume the defense of any such suit
and retain counsel, the defendant or defendants in such suit shall bear the
fees and expenses of any additional counsel retained by any of them; but in
case you do not elect to assume the defense of any such suit, you will
reimburse us, our officers and directors, and any controlling persons named
as defendants in such suit, for the fees and expenses of any counsel
retained by us and/or them. Your indemnification agreement contained in
this Paragraph 13(a) shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of any person entitled
to indemnification pursuant to this Paragraph 13(a), and shall survive the
delivery of any Fund shares and termination of this Agreement. This
agreement of indemnity will inure exclusively to the benefit of the persons
entitled to indemnification from you pursuant to this Agreement and their
respective estates, successors and assigns.
(b) We agree to indemnify, defend and hold you and your several officers
and directors, and each Fund and its several officers and directors or
trustees or managing general partners, and any person who controls you
and/or each Fund within the meaning of Section 15 of the Securities Act of
1933, as amended, free and harmless from and against any and all claims,
demands, liabilities and expenses (including the cost of investigating or
defending such claims, demands or liabilities and any counsel fees incurred
in connection therewith) which you and your several officers and directors,
or the Fund and its officers and directors or trustees or managing general
partners, or any such controlling person, may incur under the Securities
Act of 1933, as amended, or under common law or otherwise, arising out of
or based upon (i) any breach of any representation, warranty or covenant
made by us herein, or (ii) any failure by us to perform our obligations as
set forth herein, or (iii) any untrue, or alleged untrue, statement of a
material fact contained in the information furnished in writing by us to
you or any Fund specifically for use in such Fund's Registration Statement
or Prospectus, or used in the answers to any of the items of the
Registration Statement or in the corresponding statements made in the
Prospectus, or arising out of or based upon any omission, or alleged
omission, to state a material fact in connection with such information
furnished in writing by us to you or the Fund and required to be stated in
such answers or necessary to make such information not misleading. Our
agreement to indemnify you and your officers and directors, and the Fund
and its officers and directors or trustees or managing general partners,
and any such controlling person, as aforesaid, is expressly conditioned
upon our being notified of any action brought against any person or entity
entitled to indemnification hereunder, such notification to be given by
letter or by telecopier, telex, telegram or similar means of same day
delivery received by us at our address as specified in Paragraph 18 of this
Agreement within seven (7) days after the summons or other first legal
process shall have been served. The failure so to notify us of any such
action shall not relieve us from any liability which we may have to you or
your officers and directors, or to the Fund or its officers and directors
or trustees or managing general partners, or to any such controlling
person, by reason or any such breach, failure or untrue, or alleged untrue,
statement or omission, or alleged omission, otherwise than on account of
our indemnity agreement contained in this Paragraph 13(b). We shall be
entitled to assume the defense of any suit brought to enforce any such
claim, demand, liability or expense. In the event that we elect to assume
the defense of any such suit and retain counsel, the defendant or
defendants in such suit shall bear the fees and expenses of any additional
counsel retained by any of them; but in case we do not elect to assume the
defense of any such suit, we will reimburse you and your officers and
directors, and the Fund and its officers and directors or trustees or
managing general partners, and any controlling persons named as defendants
in such suit, for the fees and expenses of any counsel retained by you
and/or them. Our indemnification agreements contained in Paragraph 8 above,
Paragraph 16 below and this Paragraph 13(b) shall remain operative and in
full force and effect regardless of any investigation made by or on behalf
of any person entitled to indemnification pursuant to Paragraph 8 above,
Paragraph 16 below or this Paragraph 1 3(b), and shall survive the delivery
of any Fund shares and termination of this Agreement. Such agreements of
indemnity will inure exclusively to the benefit of the persons entitled to
indemnification hereunder and their respective estates, successors and
assigns.
14. The names and addresses and other information concerning our customers are
and shall remain our sole property, and neither you nor your affiliates
shall use such names, addresses or other information for any purpose except
in connection with the performance of your duties and responsibilities
hereunder and except for servicing and informational mailings relating to
the Funds. Notwithstanding the foregoing, this Paragraph 14 shall not
prohibit you or any of your affiliates from utilizing for any purpose the
names, addresses or other information concerning any of our customers if
such names, addresses or other information are obtained in any manner other
than from us pursuant to this Agreement. The provisions of this Paragraph
14 shall survive the termination of this Agreement.
15. We agree to serve as a service agent or to provide distribution assistance,
in accordance with the terms of the Form of Service Agreement annexed
hereto as Appendix A, Form of Shareholder Services Agreement annexed hereto
as Appendix B, and/or Form of Distribution Plan Agreement annexed hereto as
Appendix C, as applicable, for all of our customers who purchase shares of
any and all Funds whose Prospectuses provide therefor. By executing this
Agreement, each of the parties hereto agrees to be bound by all terms,
conditions, rights and obligations set forth in the forms of agreement
annexed hereto and further agrees that such forms of agreement supersede
any and all prior service agreements or other similar agreements between
the parties hereto relating to any Fund or Funds. It is recognized that
certain parties may not be permitted to collect distribution fees under the
Form of Distribution Plan Agreement annexed hereto, and if we are such a
party, we will not collect such fees.
16. By completing the Expedited Redemption Information Form annexed hereto as
Appendix D, we agree that you, each Fund with respect to which you permit
us to exercise an expedited redemption privilege, the Transfer Agent of
each such Fund, and your and their respective officers, directors or
trustees or managing general partners, agents, employees and affiliates
shall not be liable for and shall be fully indemnified and held harmless by
us from and against any and all claims, demands, liabilities and expenses
(including, without limitation, reasonable attorneys' fees) arising out of
or in connection with any expedited redemption payments made in reliance
upon the information set forth in such Appendix D.
17. Neither this Agreement nor the performance of the services of the
respective parties hereunder shall be considered to constitute an exclusive
arrangement, or to create a partnership, association or joint venture
between you and us. Neither party hereto shall be, act as, or represent
itself as, the agent or representative of the other, nor shall either party
have the right or authority to assume, create or incur any liability or any
obligation of any kind, express or implied, against or in the name of, or
on behalf of, the other party. This Agreement is not intended to, and shall
not, create any rights against either party hereto by any third party
solely on account of this Agreement. Neither party hereto shall use the
name of the other party in any manner without the other party's prior
written consent, except as required by any applicable federal or state law,
rule, regulation, requirement or condition, and except pursuant to any
promotional programs mutually agreed upon in writing by the parties hereto.
18. Except as otherwise specifically provided herein, all notices required or
permitted to be given pursuant to this Agreement shall be given in writing
and delivered by personal delivery or by postage prepaid, registered or
certified United States first class mail, return receipt requested, or by
telecopier, telex, telegram or similar means of same day delivery (with a
confirming copy by mail as provided herein). Unless otherwise notified in
writing, all notices to you shall be given or sent to you at your offices,
located at 200 Park Avenue, New York, New York 10166, Attention: General
Counsel, and all notices to us shall be given or sent to us at our address
shown below.
19. This Agreement shall become effective only when accepted and signed by you,
and may be terminated at any time by either party hereto upon 15 days'
prior written notice to the other party. This Agreement, including the
Appendices hereto, may be amended by you upon 15 days' prior written notice
to us, and such amendment shall be deemed accepted by us upon the placement
of any order for the purchase of Fund shares or the acceptance of a fee
payable under this Agreement, including the Appendices hereto, after the
effective date of any such amendment. This Agreement may not be assigned by
us without your prior written consent. This Agreement constitutes the
entire agreement and understanding between the parties hereto relating to
the subject matter hereof and supersedes any and all prior agreements
between the parties hereto relating to the subject matter hereof.
20. This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York, without giving effect to principles
of conflicts of laws.
Very truly yours,
Name of Broker or Dealer (Please Print or Type)
Address
Date: _____________________________ By:
Authorized Signature
NOTE: Please sign and return both copies of this Agreement to Dreyfus Service
Corporation. Upon acceptance one countersigned copy will be returned to you
for your files.
Accepted:
DREYFUS SERVICE CORPORATION
Date: _____________________________ By:
Authorized Signature
APPENDIX A
TO BROKER-DEALER AGREEMENT
FORM OF SERVICE AGREEMENT
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We wish to enter into an Agreement with you for servicing shareholders of, and
administering shareholder accounts in, certain mutual fund(s) managed, advised
or administered by The Dreyfus Corporation or its subsidiaries or affiliates
(hereinafter referred to individually as the "Fund" and collectively as the
"Funds"). You are the principal underwriter as defined in the Investment Company
Act of 1940, as amended (the "Act"), and the exclusive agent for the continuous
distribution of shares of the Funds.
The terms and conditions of this Agreement are as follows:
1. We agree to provide shareholder and administrative services for our
clients who own shares of the Funds ("clients"), which services may
include, without limitation: answering client inquiries about the Funds;
assisting clients in changing dividend options, account designations and
addresses; performing subaccounting; establishing and maintaining
shareholder accounts and records; processing purchase and redemption
transactions; investing client account cash balances automatically in
shares of one or more of the Funds; providing periodic statements and/or
reports showing a client's account balance and integrating such
statements with those of other transactions and balances in the client's
other accounts serviced by us; arranging for bank wires; and providing
such other information and services as you reasonably may request, to
the extent we are permitted by applicable statute, rule or regulation.
We represent and warrant to, and agree with you, that the compensation
payable to us hereunder, together with any other compensation payable to
us by clients in connection with the investment of their assets in
shares of the Funds, will be properly disclosed by us to our clients.
2. We shall provide such office space and equipment, telephone facilities
and personnel (which may be all or any part of the space, equipment and
facilities currently used in our business, or all or any personnel
employed by us) as is necessary or beneficial for providing information
and services to each Fund's shareholders, and to assist you in servicing
accounts of clients. We shall transmit promptly to clients all
communications sent to us for transmittal to clients by or on behalf of
you, any Fund, or any Fund's investment adviser, custodian or transfer
or dividend disbursing agent.
3. We agree that neither we nor any of our employees or agents are authorized
to make any representation concerning shares of any Fund, except those
contained in the then current Prospectus for such Fund, copies of which
will be supplied by you to us in reasonable quantities upon request. We
shall have no authority to act as agent for the Funds or for you.
4. You reserve the right, at your discretion and without notice, to suspend
the sale of shares or withdraw the sale of shares of any or all of the
Funds.
5. We acknowledge that this Agreement shall become effective for a Fund only
when approved by vote of a majority of (i) the Fund's Board of Directors or
Trustees or Managing General Partners, as the case may be (collectively
"Directors," individually "Director"), and (ii) Directors who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such approval.
6. This Agreement shall continue until the last day of the calendar year
next following the date of execution, and thereafter shall continue
automatically for successive annual periods ending on the last day of
each calendar year. For all Funds as to which Board approval of this
Agreement is required, such continuance must be approved specifically at
least annually by a vote of a majority of (i) the Fund's Board of
Directors and (ii) Directors who are not "interested persons" (as
defined in the Act) of the Fund and have no direct or indirect financial
interest in this Agreement, by vote cast in person at a meeting called
for the purpose of voting on such approval. For any Fund as to which
Board approval of this Agreement is required, this Agreement is
terminable without penalty, at any time, by a majority of the Fund's
Directors who are not "interested persons" (as defined in the Act) and
have no direct or indirect financial interest in this Agreement or, upon
not more than 60 days' written notice, by vote of holders of a majority
of the Fund's shares. As to all Funds, this Agreement is terminable
without penalty upon 15 days' notice by either party. In addition, you
may terminate this Agreement as to any or all Funds immediately, without
penalty, if the present investment adviser of such Fund(s) ceases to
serve the Fund(s) in such capacity, or if you cease to act as
distributor of such Fund(s). Notwithstanding anything contained herein,
if we fail to perform the shareholder servicing and administrative
functions contemplated herein by you as to any or all of the Funds, this
Agreement shall be terminable effective upon receipt of notice thereof
by us. This Agreement also shall terminate automatically in the event of
its assignment (as defined in the Act).
7. In consideration of the services and facilities described herein, we
shall be entitled to receive from you, and you agree to pay to us, the
fees described as payable to us in each Fund's Service Plan adopted
pursuant to Rule 12b-1 under the Act, and Prospectus and related
Statement of Additional Information. We understand that any payments
pursuant to this Agreement shall be paid only so long as this Agreement
and such Plan are in effect. We agree that no Director, officer or
shareholder of the Fund shall be liable individually for the performance
of the obligations hereunder or for any such payments.
8. We agree to provide to you and each applicable Fund such information
relating to our services hereunder as may be required to be maintained by
you and/or such Fund under applicable federal or state laws, and the rules,
regulations, requirements or conditions of applicable regulatory and
self-regulatory agencies or authorities.
9. This Agreement shall not constitute either party the legal representative
of the other, nor shall either party have the right or authority to assume,
create or incur any liability or any obligation of any kind, express or
implied, against or in the name of or on behalf of the other party.
10. All notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by personal delivery or by postage
prepaid, registered or certified United States first class mail, return
receipt requested, or by telecopier, telex, telegram or similar means of
same day delivery (with a confirming copy by mail as provided herein).
Unless otherwise notified in writing, all notices to you shall be given or
sent to you at 200 Park Avenue, New York, New York 10166, Attention:
General Counsel, and all notices to us shall be given or sent to us at our
address which shall be furnished to you in writing on or before the
effective date of this Agreement.
11. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principles of conflict of
laws.
APPENDIX B
TO BROKER-DEALER AGREEMENT
FORM OF SHAREHOLDER SERVICES AGREEMENT
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We wish to enter into an Agreement with you for servicing shareholders of, and
administering shareholder accounts in, certain mutual fund(s) managed, advised
or administered by The Dreyfus Corporation or its subsidiaries or affiliates
(hereinafter referred to individually as the "Fund" and collectively as the
"Funds"). You are the principal underwriter as defined in the Investment Company
Act of 1940, as amended (the "Act"), and the exclusive agent for the continuous
distribution of shares of the Funds.
The terms and conditions of this Agreement are as follows:
1. We agree to provide shareholder and administrative services for our
clients who own shares of the Funds ("clients"), which services may
include, without limitation: assisting clients in changing dividend
options, account designations and addresses; performing subaccounting;
establishing and maintaining shareholder accounts and records;
processing purchase and redemption transactions; providing periodic
statements and/or reports showing a client's account balance and
integrating such statements with those of other transactions and
balances in the client's other accounts serviced by us; arranging for
bank wires; and providing such other information and services as you
reasonably may request, to the extent we are permitted by applicable
statute, rule or regulation. We represent and warrant to, and agree with
you, that the compensation payable to us hereunder, together with any
other compensation payable to us by clients in connection with the
investment of their assets in shares of the Funds, will be properly
disclosed by us to our clients, will be authorized by our clients and
will not result in an excessive or unauthorized fee to us. We will act
solely as agent for, upon the order of, and for the account of, our
clients.
2. We shall provide such office space and equipment, telephone facilities
and personnel (which may be all or any part of the space, equipment and
facilities currently used in our business, or all or any personnel
employed by us) as is necessary or beneficial for providing information
and services to each Fund's shareholders, and to assist you in servicing
accounts of clients. We shall transmit promptly to clients all
communications sent to us for transmittal to clients by or on behalf of
you, any Fund, or any Fund's investment adviser, custodian or transfer
or dividend disbursing agent. We agree that in the event an issue
pertaining to a Fund's Shareholder Services Plan is submitted for
shareholder approval, we will vote any Fund shares held for our own
account in the same proportion as the vote of those shares held for our
clients' accounts.
3. We agree that neither we nor any of our employees or agents are authorized
to make any representation concerning shares of any Fund, except those
contained in the then current Prospectus for such Fund, copies of which
will be supplied by you to us in reasonable quantities upon request. We
shall have no authority to act as agent for the Funds or for you.
4. You reserve the right, at your discretion and without notice, to suspend
the sale of shares or withdraw the sale of shares of any or all of the
Funds.
5. We acknowledge that this Agreement shall become effective for a Fund only
when approved by vote of a majority of (i) the Fund's Board of Directors or
Trustees or Managing General Partners, as the case may be (collectively
"Directors," individually "Director"), and (ii) Directors who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such approval.
6. This Agreement shall continue until the last day of the calendar year
next following the date of execution, and thereafter shall continue
automatically for successive annual periods ending on the last day of
each calendar year. Such continuance must be approved specifically at
least annually by a vote of a majority of (i) the Fund's Board of
Directors and (ii) Directors who are not "interested persons" (as
defined in the Act) of the Fund and have no direct or indirect financial
interest in this Agreement, by vote cast in person at a meeting called
for the purpose of voting on such approval. This Agreement is terminable
without penalty, at any time, by a majority of the Fund's Directors who
are not "interested persons" (as defined in the Act) and have no direct
or indirect financial interest in this Agreement. This Agreement is
terminable without penalty upon 15 days' notice by either party. In
addition, you may terminate this Agreement as to any or all Funds
immediately, without penalty, if the present investment adviser of such
Fund(s) ceases to serve the Fund(s) in such capacity, or if you cease to
act as distributor of such Fund(s). Notwithstanding anything contained
herein, if we fail to perform the shareholder servicing and
administrative functions contemplated herein by you as to any or all of
the Funds, this Agreement shall be terminable effective upon receipt of
notice thereof by us. This Agreement also shall terminate automatically
in the event of its assignment (as defined in the Act).
7. In consideration of the services and facilities described herein, we
shall be entitled to receive from you, and you agree to pay to us, the
fees described as payable to us in each Fund's Shareholder Services Plan
and Prospectus and related Statement of Additional Information. We
understand that any payments pursuant to this Agreement shall be paid
only so long as this Agreement and such Plan are in effect. We agree
that no Director, officer or shareholder of the Fund shall be liable
individually for the performance of the obligations hereunder or for any
such payments.
8. We agree to provide to you and each applicable Fund such information
relating to our services hereunder as may be required to be maintained by
you and/or such Fund under applicable federal or state laws, and the rules,
regulations, requirements or conditions of applicable regulatory and
self-regulatory agencies or authorities.
9. This Agreement shall not constitute either party the legal representative
of the other, nor shall either party have the right or authority to assume,
create or incur any liability or any obligation of any kind, express or
implied, against or in the name of or on behalf of the other party.
10. All notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by personal delivery or by postage
prepaid, registered or certified United States first class mail, return
receipt requested, or by telex, telecopier, telegram or similar means of
same day delivery (with a confirming copy by mail as provided herein).
Unless otherwise notified in writing, all notices to you shall be given or
sent to you at 200 Park Avenue, New York, New York 10166, Attention:
General Counsel, and all notices to us shall be given or sent to us at our
address which shall be furnished to you in writing on or before the
effective date of this Agreement.
11. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principles of conflict of
laws.
APPENDIX C
TO BROKER-DEALER AGREEMENT
FORM OF DISTRIBUTION PLAN AGREEMENT
Dreyfus Service Corporation
200 Park Avenue
New York, New York 10166
Gentlemen:
We wish to enter into an Agreement with you with respect to our providing
distribution assistance relating to shares of certain mutual fund(s) managed,
advised or administered by The Dreyfus Corporation or its subsidiaries or
affiliates (hereinafter referred to individually as the "Fund" and collectively
as the "Funds"). You are the principal underwriter as defined in the Investment
Company Act of 1940, as amended (the "Act"), and the exclusive agent for the
continuous distribution of shares of the Funds.
The terms and conditions of this Agreement are as follows:
1. We agree to provide distribution assistance in connection with the sale of
shares of the Funds. We represent and warrant to, and agree with you, that
the compensation payable to us hereunder, together with any other
compensation payable to us by clients in connection with the investment of
their assets in shares of the Funds, will be properly disclosed by us to
our clients.
2. We shall provide such office space and equipment, telephone facilities
and personnel (which may be all or any part of the space, equipment and
facilities currently used in our business, or all or any personnel
employed by us) as is necessary or beneficial for providing services
hereunder. We shall transmit promptly to clients all communications sent
to us for transmittal to clients by or on behalf of you, any Fund, or
any Fund's investment adviser, custodian or transfer or dividend
disbursing agent.
3. We agree that neither we nor any of our employees or agents are authorized
to make any representation concerning shares of any Fund, except those
contained in the then current Prospectus for such Fund, copies of which
will be supplied by you to us in reasonable quantities upon request. We
shall have no authority to act as agent for the Funds or for you.
4. You reserve the right, at your discretion and without notice, to suspend
the sale of shares or withdraw the sale of shares of any or all of the
Funds.
5. We acknowledge that this Agreement shall become effective for a Fund only
when approved by vote of a majority of (i) the Fund's Board of Directors or
Trustees or Managing General Partners, as the case may be (collectively
"Directors," individually "Director"), and (ii) Directors who are not
"interested persons" (as defined in the Act) of the Fund and have no direct
or indirect financial interest in this Agreement, cast in person at a
meeting called for the purpose of voting on such approval.
6. This Agreement shall continue until the last day of the calendar year
next following the date of execution, and thereafter shall continue
automatically for successive annual periods ending on the last day of
each calendar year. Such continuance must be approved specifically at
least annually by a vote of a majority of (i) the Fund's Board of
Directors and (ii) Directors who are not "interested persons" (as
defined in the Act) of the Fund and have no direct or indirect financial
interest in this Agreement, by vote cast in person at a meeting called
for the purpose of voting on such approval. This Agreement is terminable
without penalty, at any time, by a majority of the Fund's Directors who
are not "interested persons (as defined in the Act) and have no direct
or indirect financial interest in this Agreement, or upon not more than
60 days' written notice, by vote of holders of a majority of the Fund's
shares. This Agreement is terminable without penalty upon 15 days'
notice by either party. In addition, you may terminate this Agreement as
to any or all Funds immediately, without penalty, if the present
investment adviser of such Fund(s) ceases to serve the Fund(s) in such
capacity, or if you cease to act as distributor of such Fund(s).
Notwithstanding anything contained herein, if we fail to perform the
distribution functions contemplated herein by you as to any or all of
the Funds, this Agreement shall be terminable effective upon receipt of
notice thereof by us. This Agreement also shall terminate automatically
in the event of its assignment (as defined in the Act).
7. In consideration of the services and facilities described herein, we
shall be entitled to receive from you, and you agree to pay to us, the
fees described as payable to us in each Fund's Distribution Plan adopted
pursuant to Rule 12b-1 under the Act, and Prospectus and related
Statement of Additional Information. We understand that any payments
pursuant to this Agreement shall be paid only so long as this Agreement
and such Plan are in effect. We agree that no Director, officer or
shareholder of the Fund shall be liable individually for the performance
of the obligations hereunder or for any such payments.
8. We agree to provide to you and each applicable Fund such information
relating to our services hereunder as may be required to be maintained by
you and/or such Fund under applicable federal or state laws, and the rules,
regulations, requirements or conditions of applicable regulatory and
self-regulatory agencies or authorities.
9. This Agreement shall not constitute either party the legal representative
of the other, nor shall either party have the right or authority to assume,
create or incur any liability or any obligation of any kind, express or
implied, against or in the name of or on behalf of the other party.
10. All notices required or permitted to be given pursuant to this Agreement
shall be given in writing and delivered by personal delivery or by postage
prepaid, registered or certified United States first class mail, return
receipt requested, or by telecopier, telex, telegram or similar means of
same day delivery (with a confirming copy by mail as provided herein).
Unless otherwise notified in writing, all notices to you shall be given or
sent to you at 200 Park Avenue, New York, New York 10166, Attention:
General Counsel, and all notices to us shall be given or sent to us at our
address which shall be furnished to you in writing on or before the
effective date of this Agreement.
11. This Agreement shall be construed in accordance with the internal laws of
the State of New York, without giving effect to principles of conflict of
laws.
APPENDIX D
TO BROKER-DEALER AGREEMENT
EXPEDITED REDEMPTION INFORMATION FORM
The following information is provided by the Firm identified below which desires
to exercise expedited redemption privileges with respect to shares of certain
mutual funds managed, advised or administered by The Dreyfus Corporation or its
subsidiaries or affiliates, which shares are registered in the name of, or
beneficially owned by, the customers of such Firm.
(PLEASE PRINT OR TYPE)
NAME OF FIRM
STREET ADDRESS CITY STATE ZIP CODE
In order to speed payment, redemption proceeds shall be sent only to the
commercial bank identified below, for credit to customer accounts of the
above-named Firm.
NAME OF COMMERCIAL BANK TO RECEIVE ALL PAYMENTS - ABA NUMBER
ACCOUNT NAME ACCOUNT NUMBER
STREET ADDRESS CITY STATE ZIP CODE
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the captions "Financial
Highlights" and "Counsel and Independent Auditors" and to the use of our report
dated March 3, 2000, which is incorporated by reference, in this Registration
Statement (Form N-1A 33-7497) of Dreyfus Premier California Municipal Bond Fund.
ERNST & YOUNG LLP
New York, New York
May 24, 2000
THE DREYFUS FAMILY OF FUNDS
(Dreyfus Premier Family of Fixed-Income Funds)
Rule 18f-3 Plan
Rule 18f-3 under the Investment Company Act of 1940, as amended (the
"1940 Act"), requires that the Board of an investment company desiring to offer
multiple classes pursuant to said Rule adopt a plan setting forth the separate\
arrangement and expense allocation of each class, and any related conversion
features or exchange privileges.
The Board, including a majority of the non-interested Board members,
of each of the investment companies, or series thereof, listed on Schedule A
attached hereto (each, a "Fund") which desires to offer multiple classes has
determined that the following plan is in the best interests of each class
individually and the Fund as a whole:
1. Class Designation: Fund shares shall be divided into
Class A, Class B and Class C.
2. Differences in Services: The services offered to shareholders of
each Class shall be substantially the same, except that Right of Accumulation,
Letter of Intent, and Checkwriting services shall be available only to holders
of Class A shares.
3. Differences in Distribution Arrangements: Class A shares shall be
offered with a front-end sales charge, as such term is defined under the Conduct
Rules of the National Association of Securities Dealers, Inc., and a deferred
sales charge (a "CDSC"), as such term is defined under said Conduct Rules, may
be assessed on certain redemptions of Class A shares purchased without an
initial sales charge as part of an investment of $1 million or more. The amount
of the sales charge and the amount of and provisions relating to the CDSC
pertaining to the Class A shares are set forth on Schedule B hereto.
Class B shares shall not be subject to a front-end sales charge, but
shall be subject to a CDSC and shall be charged an annual distribution fee under
a Distribution Plan adopted pursuant to Rule 12b-1 under the 1940 Act. The
amount of and provisions relating to the CDSC, and the amount of the fees under
the Distribution Plan pertaining to the Class B shares, are set forth on
Schedule C hereto.
Class C shares shall not be subject to a front-end sales charge, but
shall be subject to a CDSC and shall be charged an annual distribution fee under
a Distribution Plan adopted pursuant to Rule 12b-1 under the 1940 Act. The
amount of and provisions relating to the CDSC, and the amount of the fees under
the Distribution Plan pertaining to the Class C shares, are set forth on
Schedule D hereto.
Each Class of shares shall be subject to an annual service fee at
the rate of .25% of the value of the average daily net assets of such Class
pursuant to a Shareholder Services Plan.
4. Expense Allocation: The following expenses shall be allocated, to
the extent practicable, on a Class-by-Class basis: (a) fees under the
Distribution Plan and Shareholder Services Plan; (b) printing and postage
expenses related to preparing and distributing materials, such as shareholder
reports, prospectuses and proxies, to current shareholders of a specific Class;
(c) Securities and Exchange Commission and Blue Sky registration fees incurred
by a specific Class; (d) the expense of administrative personnel and services as
required to support the shareholders of a specific Class; (e) litigation or
other legal expenses relating solely to a specific Class; (f) transfer agent
fees identified by the Fund's transfer agent as being attributable to a specific
Class; and (g) Board members' fees incurred as a result of issues relating to a
specific Class.
5. Conversion Features: Class B shares shall automatically convert
to Class A shares after a specified period of time after the date of purchase,
based on the relative net asset value of each such Class without the imposition
of any sales charge, fee or other charge, as set forth on Schedule E hereto. No
other Class shall be subject to any automatic conversion feature.
6. Exchange Privileges: Shares of a Class shall be exchangeable only
for (a) shares of the same Class of other investment companies managed or
administered by The Dreyfus Corporation or its affiliates as specified from time
to time and (b) shares of certain other Classes of such investment companies or
shares of certain other investment companies specified from time to time.
A-1
640595v1
SCHEDULE A
Date Plan
Name of Fund Adopted
- ------------ ---------
Dreyfus Premier California Municipal April 12, 1995
Bond Fund (Revised as of
November 15, 1999)
Dreyfus Premier GNMA Fund April 12, 1995
(Revised as of
November 15, 1999)
Dreyfus Premier Municipal Bond Fund April 12, 1995
(Revised as of
November 15, 1999)
Dreyfus Premier New York Municipal April 12, 1995
Bond Fund (Revised as of
November 15, 1999)
Dreyfus Premier State Municipal April 12, 1995
Bond Fund (Revised as of
November 15, 1999)
640595v1 B-1
SCHEDULE B
Front-End Sales Charge--Class A Shares--The public offering price for Class A
shares shall be the net asset value per share of that Class plus a sales load as
shown below:
Total Sales Load
---------------------------------
Amount of Transaction As a % of As a % of
- --------------------- offering net asset
price per value per
share share
-------------- --------------
Less than $50,000......................... 4.50 4.70
$50,000 to less than $100,000............. 4.00 4.20
$100,000 to less than $250,000............ 3.00 3.10
$250,000 to less than $500,000............ 2.50 2.60
$500,000 to less than $1,000,000.......... 2.00 2.00
$1,000,000 or more........................ -0- -0-
Contingent Deferred Sales Charge--Class A Shares--A CDSC of 1.00% shall be
assessed at the time of redemption of Class A shares purchased without an
initial sales charge as part of an investment of at least $1,000,000 and
redeemed within one year of purchase. The terms contained in Schedule C
pertaining to the CDSC assessed on redemptions of Class B shares (other than the
amount of the CDSC and its time periods), including the provisions for waiving
the CDSC, shall be applicable to the Class A shares subject to a CDSC. Letter of
Intent and Right of Accumulation shall apply to such purchases of Class A
shares.
640595v1 C-3
SCHEDULE C
Contingent Deferred Sales Charge--Class B Shares--A CDSC payable to the Fund's
Distributor shall be imposed on any redemption of Class B shares which reduces
the current net asset value of such Class B shares to an amount which is lower
than the dollar amount of all payments by the redeeming shareholder for the
purchase of Class B shares of the Fund held by such shareholder at the time of
redemption. No CDSC shall be imposed to the extent that the net asset value of
the Class B shares redeemed does not exceed (i) the current net asset value of
Class B shares acquired through reinvestment of dividends or capital gain
distributions, plus (ii) increases in the net asset value of the shareholder's
Class B shares above the dollar amount of all payments for the purchase of Class
B shares of the Fund held by such shareholder at the time of redemption.
If the aggregate value of the Class B shares redeemed has declined
below their original cost as a result of the Fund's performance, a CDSC may be
applied to the then-current net asset value rather than the purchase price.
In circumstances where the CDSC is imposed, the amount of the charge
shall depend on the number of years from the time the shareholder purchased the
Class B shares until the time of redemption of such shares. Solely for purposes
of determining the number of years from the time of any payment for the purchase
of Class B shares, all payments during a month shall be aggregated and deemed to
have been made on the first day of the month.
The following table sets forth the rates of the CDSC for Class B
shares, except for Class B shares purchased by shareholders who beneficially
owned Class B shares on November 30, 1996:
CDSC as a % of
Year Since Amount Invested or
Purchase Payment Redemption
Was Made Proceeds
- ---------------- -----------
First.............................. 4.00
Second............................. 4.00
Third.............................. 3.00
Fourth............................. 3.00
Fifth.............................. 2.00
Sixth.............................. 1.00
The following table sets forth the rates of the CDSC for Class B
shares purchased by shareholders who beneficially owned Class B shares on
November 30, 1996:
CDSC as a % of
Year Since Amount Invested or
Purchase Payment Redemption
Was Made Proceeds
- ---------------- -----------
First.............................. 3.00
Second............................. 3.00
Third.............................. 2.00
Fourth............................. 2.00
Fifth.............................. 1.00
Sixth.............................. 0.00
In determining whether a CDSC is applicable to a redemption, the
calculation shall be made in a manner that results in the lowest possible rate.
Therefore, it shall be assumed that the redemption is made first of amounts
representing shares acquired pursuant to the reinvestment of dividends and
distributions; then of amounts representing the increase in net asset value of
Class B shares above the total amount of payments for the purchase of Class B
shares made during the preceding six years (five years for shareholders
beneficially owning Class B shares on November 30, 1996); then of amounts
representing the cost of shares purchased six years (five years for shareholders
beneficially owning Class B shares on November 30, 1996) prior to the
redemption; and finally, of amounts representing the cost of shares held for the
longest period of time within the applicable six-year period (five-year period
for shareholders beneficially owning Class B shares on November 30, 1996).
Waiver of CDSC--The CDSC shall be waived in connection with (a) redemptions made
within one year after the death or disability, as defined in Section 72(m)(7) of
the Internal Revenue Code of 1986, as amended (the "Code"), of the shareholder,
(b) redemptions 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 Fund's Distributor exceeds one million dollars,
(c) redemptions as a result of a combination of any investment company with the
Fund by merger, acquisition of assets or otherwise, (d) a distribution following
retirement under a tax-deferred retirement plan or upon attaining age 70-1/2 in
the case of an IRA or Keogh plan or custodial account pursuant to Section 403(b)
of the Code, and (e) redemptions pursuant to any systematic withdrawal plan as
described in the Fund's prospectus. Any Fund shares subject to a CDSC which were
purchased prior to the termination of such waiver shall have the CDSC waived as
provided in the Fund's prospectus at the time of the purchase of such shares.
Amount of Distribution Plan Fees--Class B Shares--.50 of 1% of the value of the
average daily net assets of Class B.
640595v1 D-1
SCHEDULE D
Contingent Deferred Sales Charge--Class C Shares--A CDSC of 1.00% payable to the
Fund's Distributor shall be imposed on any redemption of Class C shares within
one year of the date of purchase. The basis for calculating the payment of any
such CDSC shall be the method used in calculating the CDSC for Class B shares.
In addition, the provisions for waiving the CDSC shall be those set forth for
Class B shares.
Amount of Distribution Plan Fees--Class C Shares--.75 of 1% of the value of the
average daily net assets of Class C.
640595v1 E-1
SCHEDULE E
Conversion of Class B Shares--Approximately six years after the date of
purchase, Class B shares automatically shall convert to Class A shares, based on
the relative net asset values for shares of each such Class, and shall no longer
be subject to the distribution fee. At that time, Class B shares that have been
acquired through the reinvestment of dividends and distributions ("Dividend
Shares") shall be converted in the proportion that a shareholder's Class B
shares (other than Dividend Shares) converting to Class A shares bears to the
total Class B shares then held by the shareholder which were not acquired
through the reinvestment of dividends and distributions.
CONFIDENTIAL INFORMATION AND
SECURITIES TRADING POLICY
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C>
CONTENTS
Page
- ------------------------------
INTRODUCTION .................................................... 1
PART I
APPLICABLE TO ALL ASSOCIATES
SECTION ONE
CONFIDENTIAL INFORMATION............................ 2
-Types of Confidential Information.................. 2
-Rules for Protecting Confidential Information...... 3
-Supplemental Procedures............................ 4
SECTION TWO
INSIDER TRADING AND TIPPING......................... 5
-Legal Prohibitions................................. 5
-Mellon's Policy.................................... 6
SECTION THREE
RESTRICTIONS ON THE FLOW OF INFORMATION
WITHIN MELLON (THE "CHINESE WALL").................. 7
-Rules for Maintaining the Chinese Wall............. 7
-Reporting Receipt of Material Nonpublic
Information........................................ 8
-Functions "Above the Wall"......................... 9
-Supplemental Procedures............................ 9
SECTION FOUR
RESTRICTIONS ON TRANSACTIONS IN MELLON
SECURITIES..........................................10
-Beneficial Ownership...............................11
SECTION FIVE
RESTRICTIONS ON TRANSACTIONS IN OTHER
SECURITIES..........................................12
SECTION SIX
CLASSIFICATION OF ASSOCIATES........................14
-Insider Risk Associate.............................14
-Investment Associate...............................15
-Other Associate....................................15
PART II
APPLICABLE TO INSIDER
RISK ASSOCIATES ONLY ....................................................16
-Prohibition on Investments in Securities of
Financial Services Organizations...................16
-Conflict of Interest...............................17
-Preclearance for Personal Securities
Transactions.......................................17
-Personal Securities Transactions Reports...........19
-Confidential Treatment.............................19
PART III
APPLICABLE TO INVESTMENT
ASSOCIATES ONLY ....................................................20
-Special Standards of Conduct for
Investment Associates..............................20
-Preclearance for Personal Securities
Transactions.......................................21
-Personal Securities Transactions Reports...........23
-Confidential Treatment.............................24
PART IV
APPLICABLE TO OTHER
ASSOCIATES ONLY ....................................................25
-Preclearance for Personal Securities
Transactions.......................................25
-Personal Securities Transactions Reports...........25
-Restrictions on Transactions in Other
Securities.........................................25
-Confidential Treatment.............................26
PART V
APPLICABLE TO NONMANAGEMENT
BOARD MEMBERS ....................................................27
-Nonmanagement Board Member.........................27
-Standards of Conduct for Nonmanagement
Board Member.......................................27
-Preclearance for Personal Securities
Transactions.......................................28
-Personal Securities Transactions Reports...........29
-Confidential Treatment.............................29
GLOSSARY Definitions.........................................30
INDEX OF EXHIBITS ....................................................33
</TABLE>
<PAGE>
INTRODUCTION
- ------------------------------
Mellon Bank Corporation ("Mellon") and its associates, and
the registered investment companies for which The Dreyfus
Corporation ("Dreyfus") and/or Mellon serves as investment
adviser, sub-investment adviser or administrator, are
subject to certain laws and regulations governing the use
of confidential information and personal securities
trading. Mellon has developed this Confidential Information
and Securities Trading Policy (the "Policy") to establish
specific standards to promote compliance with applicable
laws. Further, the Policy is intended to protect Mellon's
business secrets and proprietary information as well as
that of its customers and any entity for which it acts in a
fiduciary capacity.
The Policy set forth procedures and limitations which
govern the personal securities transactions of every Mellon
associate and certain other individuals associated with the
registered investment companies for which Dreyfus and/or
Mellon serves as investment adviser, sub-investment adviser
or administrator. The Policy is designed to reinforce
Mellon's reputation for integrity by avoiding even the
appearance of impropriety in the conduct of Mellon's
business.
Associates should be aware that they may be held personally
liable for any improper or illegal acts committed during
the course of their employment, and that "ignorance of the
law" is not a defense. Associates may be subject to civil
penalties such as fines, regulatory sanctions including
suspensions, as well as criminal penalties.
Associates outside the United States are also subject to
applicable laws of foreign jurisdictions, which may differ
substantially from U.S. law and which may subject such
associates to additional requirements. Such associates must
comply with applicable requirements of pertinent foreign
laws as well as with the provisions of the Policy. To the
extent any particular portion of the Policy is inconsistent
with foreign law, associates should consult the General
Counsel or the Manager of Corporate Compliance.
Any provision of this Policy may be waived or exempted at
the discretion of the Manager of Corporate Compliance. Any
such waiver or exemption will be evidenced in writing and
maintained in the Risk Management and Compliance
Department.
Associates must read the Policies and MUST COMPLY
with them. Failure to comply with the provisions
of the Policies may result in the imposition of
serious sanctions, including but not limited to
disgorgement of profits, dismissal, substantial
personal liability and referral to law enforcement
agencies or other regulatory agencies. Associates
should retain the Policies in their records for
future reference. Any questions regarding the
Policies should be referred to the Manager of
Corporate Compliance or his/her designee.
<PAGE>
PART I - APPLICABLE TO ALL ASSOCIATES
- ------------------------------
SECTION ONE
CONFIDENTIAL INFORMATION
As an associate you may receive information about Mellon,
its customers and other parties that, for various reasons,
should be treated as confidential. All associates are
expected to strictly comply with measures necessary to
preserve the confidentiality of information.
TYPES OF CONFIDENTIAL INFORMATION - Although it is
impossible to provide an exhaustive list of information
that should remain confidential, the following are examples
of the general types of confidential information that
associates might receive in the ordinary course of carrying
out their job responsibilities.
o Information Obtained from Business Relations - An associate
might receive confidential information regarding customers
or other parties with whom Mellon has business
relationships. If released, such information could have a
significant effect on their operations, their business
reputations or the market price of their securities.
Disclosing such information could expose both the associate
and Mellon to liability for damages.
o Mellon Financial Information - An associate might receive
financial information regarding Mellon before such
information has been disclosed to the public. It is the
policy of Mellon to disclose all material corporate
information to the public in such a manner that all those
who are interested in Mellon and its securities have equal
access to the information. Disclosing such information to
unauthorized persons could subject both the associate and
Mellon to liability under the federal securities laws.
o Mellon Proprietary Information - Certain nonfinancial
information developed by Mellon - such as business plans,
customer lists, methods of doing business, computer
software, source codes, databases and related documentation
- constitutes valuable Mellon proprietary information.
Disclosure of such information to unauthorized persons
could harm, or reduce a benefit to, Mellon and could result
in liability for both the associate and Mellon.
o Mellon Examination Information - Banks and certain other
Mellon subsidiaries are periodically examined by regulatory
agencies. Certain reports made by those regulatory agencies
are the property of those agencies and are strictly
confidential. Giving information from these reports to
anyone not officially connected with Mellon is a criminal
offense.
o Portfolio Management Information - Portfolio management
information relating to investment accounts or funds
managed by Mellon or Dreyfus, including investment
decisions or strategies developed for the benefit of
investment companies advised by Dreyfus, is for the benefit
of such account or fund. Disclosure or exploitation of such
information by an associate in an unauthorized manner may
cause detriment to such accounts or funds and may subject
the associate to liability under the federal securities
laws.
<PAGE>
RULES FOR PROTECTING CONFIDENTIAL INFORMATION - The
following are some basic rules to follow to protect
confidential information.
o Limited Communication to Outsiders - Confidential
information should not be communicated to anyone outside
Mellon, except to the extent they need to know the
information in order to provide necessary services to
Mellon.
o Limited Communication to Insiders - Confidential
information should not be communicated to other associates,
except to the extent they need to know the information to
fulfill their job responsibilities and their knowledge of
the information is not likely to result in misuse or a
conflict of interest. In this regard, Mellon has
established specific restrictions with respect to material
nonpublic information in order to separate and insulate
different functional areas and personnel within Mellon.
Please refer to Section Three, "Restrictions on The Flow of
Information Within Mellon" (The "Chinese Wall").
o Corporate Use Only - Confidential information should be
used only for Corporate purposes. Under no circumstances
may an associate use it, directly or indirectly, for
personal gain or for the benefit of any outside party who
is not entitled to such information.
o Other Customers - Where appropriate, customers should be
made aware that associates will not disclose to them other
customers' confidential information or use the confidential
information of one customer for the benefit of another.
o Notification of Confidentiality - When confidential
information is communicated to any person, either inside or
outside Mellon, they should be informed of the
information's confidential nature and the limitations on
its further communication.
o Prevention of Eavesdropping - Confidential matters should
not be discussed in public or in places, such as in
building lobbies, restaurants or elevators, where
unauthorized persons may overhear. Precautions, such as
locking materials in desk drawers overnight, stamping
material "Confidential" and delivering materials in sealed
envelopes, should be taken with written materials to ensure
they are not read by unauthorized persons.
o Data Protection - Data stored on personal computers and
diskettes should be properly secured to ensure they are not
accessed by unauthorized persons. Access to computer files
should be granted only on a need-to-know basis. At a
minimum, associates should comply with applicable Mellon
policies on electronic data security.
<PAGE>
o Confidentiality Agreements - Confidentiality agreements to
which Mellon is a party must be complied with in addition
to, but not in lieu of, this Policy. Confidentiality
agreements that deviate from commonly used forms should be
reviewed in advance by the Legal Department.
o Contact with the Public - All contacts with institutional
shareholders or securities analysts about Mellon must be
made through the Investor Relations Division of the Finance
Department. All contacts with the media and all speeches or
other public statements made on behalf of Mellon or about
Mellon's businesses must be cleared in advance by Corporate
Affairs. In speeches and statements not made on behalf of
Mellon, care should be taken to avoid any implication that
Mellon endorses the views expressed.
SUPPLEMENTAL PROCEDURES - Mellon entities, departments,
divisions and groups should establish their own
supplemental procedures for protecting confidential
information, as appropriate. These procedures may include:
o establishing records retention and destruction policies;
o using code names;
o limiting the staffing of confidential matters (for example,
limiting the size of working groups and the use of
temporary employees, messengers and word processors); and
o requiring written confidentiality agreements from certain
associates.
Any supplemental procedures should be used only to protect
confidential information and not to circumvent appropriate
reporting and recordkeeping requirements.
<PAGE>
SECTION TWO
INSIDER TRADING AND TIPPING
LEGAL PROHIBITIONS - Federal securities laws generally
prohibit the trading of securities while in possession of
"material nonpublic" information regarding the issuer of
those securities (insider trading). Any person who passes
along the material nonpublic information upon which a trade
is based (tipping) may also be liable.
"Material" - Information is material if there is a
substantial likelihood that a reasonable investor would
consider it important in deciding whether to buy, sell or
hold securities. Obviously, information that would affect
the market price of a security would be material. Examples
of information that might be material include:
o a proposal or agreement for a merger, acquisition or
divestiture, or for the sale or purchase of substantial
assets;
o tender offers, which are often material for the party
making the tender offer as well as for the issuer of the
securities for which the tender offer is made;
o dividend declarations or changes;
o extraordinary borrowings or liquidity problems;
o defaults under agreements or actions by creditors,
customers or suppliers relating to a company's credit
standing;
o earnings and other financial information, such as large
or unusual write-offs, write-downs, profits or losses;
o pending discoveries or developments, such as new products,
sources of materials, patents, processes, inventions or
discoveries of mineral deposits;
o a proposal or agreement concerning a financial
restructuring;
o a proposal to issue or redeem securities, or a
development with respect to a pending issuance or
redemption of securities;
o a significant expansion or contraction of operations;
o information about major contracts or increases or
decreases in orders;
o the institution of, or a development in, litigation or a
regulatory proceeding;
o developments regarding a company's senior management;
o information about a company received from a director of
that company; and
o information regarding a company's possible noncompliance
with environmental protection laws.
This list is not exhaustive. All relevant circumstances
must be considered when determining whether an item of
information is material.
<PAGE>
"Nonpublic" - Information about a company is nonpublic if
it is not generally available to the investing public.
Information received under circumstances indicating that it
is not yet in general circulation and which may be
attributable, directly or indirectly, to the company or its
insiders is likely to be deemed nonpublic information.
If an associate can refer to some public source to show
that the information is generally available (that is,
available not from inside sources only) and that enough
time has passed to allow wide dissemination of the
information, the information is likely to be deemed public.
While information appearing in widely accessible sources -
such as newspapers - becomes public very soon after
publication, information appearing in less accessible
sources - such as regulatory filings - may take up to
several days to be deemed public. Similarly, highly complex
information might take longer to become public than would
information that is easily understood by the average
investor.
MELLON'S POLICY - Associates who possess material nonpublic
information about a company - whether that company is
Mellon, another Mellon entity, a Mellon customer or
supplier, or other company - may not trade in that
company's securities, either for their own accounts or for
any account over which they exercise investment discretion.
In addition, associates may not recommend trading in those
securities and may not pass the information along to
others, except to associates who need to know the
information in order to perform their job responsibilities
with Mellon. These prohibitions remain in effect until the
information has become public.
Associates who have investment responsibilities should take
appropriate steps to avoid receiving material nonpublic
information. Receiving such information could create severe
limitations on their ability to carry out their
responsibilities to Mellon's fiduciary customers.
Associates managing the work of consultants and temporary
employees who have access to the types of confidential
information described in this Policy are responsible for
ensuring that consultants and temporary employees are aware
of Mellon's policy and the consequences of noncompliance.
Questions regarding Mellon's policy on material nonpublic
information, or specific information that might be subject
to it, should be referred to the General Counsel.
<PAGE>
SECTION THREE
RESTRICTIONS ON THE FLOW OF
INFORMATION WITHIN MELLON
(THE "CHINESE WALL")
As a diversified financial services organization, Mellon
faces unique challenges in complying with the prohibitions
on insider trading and tipping of material nonpublic
information and misuse of confidential information. This is
because one Mellon unit might have material nonpublic
information about a company while other Mellon units may
have a desire, or even a fiduciary duty, to buy or sell
that company's securities or recommend such purchases or
sales to customers. To engage in such broad-ranging
financial services activities without violating laws or
breaching Mellon's fiduciary duties, Mellon has established
a "Chinese Wall" policy applicable to all associates. The
"Chinese Wall" separates the Mellon units or individuals
that are likely to receive material nonpublic information
(Potential Insider Functions) from the Mellon units or
individuals that either trade in securities - for Mellon's
account or for the accounts of others - or provide
investment advice (Investment Functions).
Examples of Potential Insider Functions - Potential Insider
Functions include, among others, certain commercial
lending, corporate finance, and credit policy areas.
Insider Risk Associates (see Section Six, "Insider Risk
Associates") should consider themselves to be in Potential
Insider Functions unless their particular job
responsibilities clearly indicate otherwise.
Examples of Investment Functions - Investment Functions
include, among others, securities sales and trading,
investment management and advisory services, investment
research and various trust or fiduciary functions.
RULES FOR MAINTAINING THE "CHINESE WALL" - Without the
prior approval of the General Counsel, material nonpublic
information obtained by anyone in a Potential Insider
Function should not be communicated to anyone in an
Investment Function. To reduce the risk of material
nonpublic information being communicated, communications
between these associates in these functions must be limited
to the maximum extent consistent with valid business needs.
Particular rules -
o File Restrictions - Associates in Investment Functions must
not have access to commercial credit files, corporate
finance files, or any other Potential Insider Function
files that might contain material nonpublic information.
All such files that contain material nonpublic information
should be marked as "Confidential" and, if feasible,
segregated from nonconfidential files.
o Electronic Data - Associates in Investment Functions must
not have access to personal computer or word processing
files of associates in Potential Insider Functions.
o Meetings - Associates in Investment Functions must not
attend meetings between customers and associates in
Potential Insider Functions unless appropriate steps have
been taken to ensure that material nonpublic information
will not be disclosed or discussed.
o Committee Service - Without the prior approval of the
General Counsel, associates other than those "Above the
Wall" (see page 9) must not serve simultaneously on a
committee having responsibility for any Investment Function
and a committee having responsibility for any Potential
Insider Function.
o Information Requests - Requests for nonmaterial information
or public information across the "Chinese Wall" should be
made in writing to an appropriate associate in the
applicable area. Associates sending or receiving such a
request should resolve any questions regarding the
materiality or nonpublic nature of the requested
information by consulting their department head, who will
contact the General Counsel, as appropriate.
o Information Backflow - Associates should take care to avoid
inadvertent backflow of information that may be interpreted
as the prohibited communication of material nonpublic
information. For example, the mere fact that someone in a
Potential Insider Function, such as a mergers and
acquisitions specialist, requests information from an
associate in an Investment Function could give the latter
person a clue as to possible material developments
affecting a customer.
o Customers - Associates in Investment Functions must not
state or imply to customers that associates making
decisions or recommendations will have the benefit of
information from Mellon's Potential Insider Functions. When
appropriate, associates should inform customers of Mellon's
"Chinese Wall" policy.
o Conflicts of Interest - Associates should not receive or
pass on any information that would create an undue risk of
Mellon or any associate having a conflict of interest or
breaching a fiduciary obligation.
REPORTING RECEIPT OF MATERIAL NONPUBLIC INFORMATION -
Associates in Investment Functions who receive any
suspected material nonpublic information must report such
receipt promptly to their department or entity head. A
department or entity head who receives information believed
to be material and nonpublic should report the matter
promptly to the General Counsel. If the General Counsel
determines that the information is material and nonpublic,
the affected department or entity will:
o immediately suspend all trading in the securities of the
issuer to which the information applies, as well as all
recommendations with respect to such securities. The
suspension will remain in effect as long as the information
remains both material and nonpublic.
O notify the General Counsel before resuming transactions or
recommendations in the affected securities. The General
Counsel will advise as to possible further steps, including
ascertaining the validity and nonpublic nature of the
information with the issuer of the securities; requesting
the issuer of the securities, or other appropriate parties,
to disseminate the information promptly to the public if
the information is valid and nonpublic; and publishing the
information.
In certain circumstances, the department or entity head may
be able to demonstrate conclusively that the receipt of the
material nonpublic information has been confined to an
individual or small group of individuals and that measures
other than those described above will comparably reduce the
likelihood of trading on the basis of the information.
These measures might include temporarily relieving
individuals of responsibility for any Investment Functions
and preventing any contact between those individuals and
associates in Investment Functions. In these circumstances,
the department head, with the approval of the General
Counsel, may take those measures rather than the measures
described above.
<PAGE>
FUNCTIONS "ABOVE THE WALL" - Some functions at Mellon are
deemed to be "Above the Wall." For example, members of
senior management, Auditing, Risk Management and
Compliance, and the Legal Department will typically need to
have access to information on both sides of the "Chinese
Wall" to carry out their job responsibilities. These
individuals cannot rely on the procedural safeguards of the
"Chinese Wall" and, therefore, need to be particularly
careful to avoid any improper use or dissemination of
material nonpublic information.
SUPPLEMENTAL PROCEDURES - As appropriate, certain Mellon
departments or areas, such as Mellon Trust, should
establish their own procedures to reduce the possibility of
information being communicated to associates who should not
have access to that information.
<PAGE>
SECTION FOUR
RESTRICTIONS ON TRANSACTIONS
IN MELLON SECURITIES
Associates who engage in transactions involving Mellon
securities should be aware of their unique responsibilities
with respect to such transactions arising from the
employment relationship and should be sensitive to even the
appearance of impropriety.
The following restrictions apply to all transactions in
Mellon's publicly traded securities occurring in the
associate's own account and in all other accounts over
which the associate could be expected to exercise influence
or control (see provisions under "Beneficial Ownership"
below for a more complete discussion of the accounts to
which these restrictions apply). These restrictions are to
be followed in addition to any restrictions that apply to
particular officers or directors (such as restrictions
under Section 16 of the Securities Exchange Act of 1934).
o Short Sales - Short sales of Mellon securities by
associates are prohibited.
o Sales Within 60 Days of Purchase - Sales of Mellon
securities within 60 days of acquisition are prohibited.
For purposes of the 60-day holding period, securities will
be deemed to be equivalent if one is convertible into the
other, if one entails a right to purchase or sell the
other, or if the value of one is expressly dependent on the
value of the other (e.g., derivative securities).
In cases of extreme hardship, associates (other than senior
management) may obtain permission to dispose of Mellon
securities acquired within 60 days of the proposed
transaction, provided the transaction is pre-cleared with
the Manager of Corporate Compliance and any profits earned
are disgorged in accordance with procedures established by
senior management. The Manager of Corporate Compliance
reserves the right to suspend the 60-day holding period
restriction in the event of severe market disruption.
o Margin Transactions - Purchases on margin of Mellon's
publicly traded securities by associates is prohibited.
Margining Mellon securities in connection with a cashless
exercise of an employee stock option through the Human
Resources Department is exempt from this restriction.
Further, Mellon securities may be used to collateralize
loans or the acquisition of securities other than those
issued by Mellon.
o Option Transactions - Option transactions involving
Mellon's publicly traded securities are prohibited.
Transactions under Mellon's Long-Term Incentive Plan or
other associate option plans are exempt from this
restriction.
o Major Mellon Events - Associates who have knowledge of
major Mellon events that have not yet been announced are
prohibited from buying and selling Mellon's publicly traded
securities before such public announcements, even if the
associate believes the event does not constitute material
nonpublic information.
o Mellon Blackout Period - Associates are prohibited from
buying or selling Mellon's publicly traded securities
during a blackout period, which begins the 16th day of the
last month of each calendar quarter and ends three business
days after Mellon publicly announces the financial results
for that quarter. In cases of extreme hardship, associates
(other than senior management) may request permission from
the Manager of Corporate Compliance to dispose of Mellon
securities during the blackout period.
<PAGE>
BENEFICIAL OWNERSHIP - The provisions discussed above apply
to transactions in the associate's own name and to all
other accounts over which the associate could be expected
to exercise influence or control, including:
o accounts of a spouse, minor children or relatives to whom
substantial support is contributed;
o accounts of any other member of the associate's household
(e.g., a relative living in the same home);
o trust accounts for which the associate acts as trustee or
otherwise exercises any type of guidance or influence;
o Corporate accounts controlled, directly or indirectly, by
the associate;
o arrangements similar to trust accounts that are established
for bona fide financial purposes and benefit the associate;
and
o any other account for which the associate is the beneficial
owner (see Glossary for a more complete legal definition of
"beneficial owner").
<PAGE>
SECTION FIVE
RESTRICTIONS ON TRANSACTIONS
IN OTHER SECURITIES
Purchases or sales by an associate of the securities of
issuers with which Mellon does business, or other third
party issuers, could result in liability on the part of
such associate. Associates should be sensitive to even the
appearance of impropriety in connection with their personal
securities transactions. Associates should refer to the
provisions under "Beneficial Ownership" (Section Four,
"Restrictions on Transactions in Mellon Securities"), which
are equally applicable to the following provisions.
The Mellon Code of Conduct contains certain restrictions on
investments in parties that do business with Mellon.
Associates should refer to the Code of Conduct and comply
with such restrictions in addition to the restrictions and
reporting requirements set forth below.
The following restrictions apply to all securities
transactions by associates:
o Credit or Advisory Relationship - Associate may not buy or
sell securities of a company if they are considering
granting, renewing or denying any credit facility to that
company or acting as an adviser to that company with
respect to its securities. In addition, lending associates
who have assigned responsibilities in a specific industry
group are not permitted to trade securities in that
industry. This prohibition does not apply to transactions
in securities issued by open-end investment companies.
o Customer Transactions - Trading for customers and Mellon
accounts should always take precedence over associates'
transactions for their own or related accounts.
o Front Running - Associates may not engage in "front
running," that is, the purchase or sale of securities for
their own accounts on the basis of their knowledge of
Mellon's trading positions or plans.
o Initial Public Offerings - Mellon prohibits its associates
from acquiring any securities in an initial public offering
("IPO").
o Margin Transactions - Margin trading is a highly leveraged
and relatively risky method of investing that can create
particular problems for financial services employees. For
this reason, all associates are urged to avoid margin
trading.
Prior to establishing a margin account, the associate must
obtain the written permission of the Manager of Corporate
Compliance. Any associate having a margin account prior to
the effective date of this Policy must notify the Manager
of Corporate Compliance of the existence of such account.
<PAGE>
All associates having margin accounts, other than described
below, must designate the Manager of Corporate Compliance
as an interested party on that account. Associates must
ensure that the Manager of Corporate Compliance promptly
receives copies of all trade confirmations and statements
relating to the account directly from the broker. If
requested by a brokerage firm, please contact the Manager
of Corporate Compliance to obtain a letter (sometimes
referred to as a "407 letter") granting permission to
maintain a margin account. Trade confirmations and
statements are not required on margin accounts established
at Dreyfus Investment Services Corporation for the sole
purpose of cashless exercises of employee stock options. In
addition, products may be offered by a broker/dealer that,
because of their characteristics, are considered margin
accounts but have been determined by the Manager of
Corporate Compliance to be outside the scope of this Policy
(e.g., a Cash Management Account which provides overdraft
protection for the customer). Any questions regarding the
establishment, use and reporting of margin accounts should
be directed to the Manager of Corporate Compliance.
Examples of an instruction letter to a broker are shown in
Exhibits B1 and B2.
o Material Nonpublic Information - Associates possessing
material nonpublic information regarding any issuer of
securities must refrain from purchasing or selling
securities of that issuer until the information becomes
public or is no longer considered material.
o Naked Options, Excessive Trading - Mellon discourages all
associates from engaging in short-term or speculative
trading, in trading naked options, in trading that could be
deemed excessive or in trading that could interfere with an
associate's job responsibilities.
o Private Placements - Associates are prohibited from
acquiring any security in a private placement unless they
obtain the prior written approval of the Preclearance
Compliance Officer (applicable only to Investment
Associates), the Manager of Corporate Compliance and the
associate's department head. Approval must be given by all
appropriate aforementioned persons for the acquisition to
be considered approved. After receipt of the necessary
approvals and the acquisition, associates are required to
disclose that investment when they participate in any
subsequent consideration of an investment in the issuer for
an advised account. Final decision to acquire such
securities for an advised account will be subject to
independent review.
o Scalping - Associates may not engage in "scalping," that
is, the purchase or sale of securities for their own or
Mellon's accounts on the basis of knowledge of customers'
trading positions or plans or Mellon's forthcoming
investment recommendations.
o Short-Term Trading - Associates are discouraged from
purchasing and selling, or from selling and purchasing, the
same (or equivalent) securities within 60 calendar days.
With respect to Investment Associates only, any profits
realized on such short-term trades must be disgorged in
accordance with procedures established by senior
management.
<PAGE>
SECTION SIX
CLASSIFICATION OF ASSOCIATES
Associates are engaged in a wide variety of activities for
Mellon. In light of the nature of their activities and the
impact of federal and state laws and the regulations
thereunder, the Policy imposes different requirements and
limitations on associates based on the nature of their
activities for Mellon. To assist the associates in
complying with the requirements and limitations imposed on
them in light of their activities, associates are
classified into one of three categories: Insider Risk
Associate, Investment Associate and Other Associate.
Appropriate requirements and limitations are specified in
the Policy based upon the associate's classification.
INSIDER RISK ASSOCIATE -
You are considered to be an Insider Risk Associate if you
are:
o employed in any of the following departments or functional
areas, however named, of a Mellon entity other than Dreyfus
(see Glossary for definition of "Dreyfus"):
<TABLE>
<CAPTION>
<S> <C>
- Auditing - International
- Capital Markets - Leasing
- Corporate Affairs - Legal
- Credit Policy - Mellon Business Credit
- Credit Recovery - Middle Market
- Credit Review - Portfolio and Funds Management
- Domestic Corporate Banking - Risk Management and Compliance
- Finance - Strategic Planning
- Institutional Banking - Wholesale, Administration and
Operations
</TABLE>
O a member of the Mellon Senior Management Committee,
provided that those members of the Mellon Senior Management
Committee who have management responsibility for fiduciary
activities or who routinely have access to information
about customers' securities transactions are considered to
be Investment Associates and are subject to those
provisions of the Policy pertaining to Investment
Associates;
o employed by a broker/dealer subsidiary of a Mellon
entity other than Dreyfus;
o an associate in the Stock Transfer business unit and have
been specifically designated as an Insider Risk Associate
by the Manager of Corporate Compliance; or
o an associate specifically designated as an Insider Risk
Associate by the Manager of Corporate Compliance.
<PAGE>
INVESTMENT ASSOCIATE -
You are considered to be an Investment Associate if you
are:
o a member of Mellon's Senior Management Committee who, as
part of his/her usual duties, has management responsibility
for fiduciary activities or routinely has access to
information about customers' securities transactions;
o a Dreyfus associate;
o an associate of a Mellon entity registered under the
Investment Advisers Act of 1940;
o employed in the trust area of Mellon and:
- have the title of Vice President, First Vice President
or Senior Vice President; or
- have access to material, confidential information
regarding securities transactions by or on behalf of
Mellon customers; or
o an associate specifically designated as an Investment
Associate by the Manager of Corporate Compliance.
OTHER ASSOCIATE -
You are considered to be an Other Associate if you are an
associate of Mellon Bank Corporation or any of its direct
or indirect subsidiaries who is not either an Insider Risk
Associate or an Investment Associate.
<PAGE>
PART II - APPLICABLE TO INSIDER
RISK ASSOCIATES ONLY
- ------------------------------
PROHIBITION ON INVESTMENTS IN SECURITIES OF FINANCIAL
SERVICES ORGANIZATIONS
You are prohibited from acquiring any security issued by a
financial services organization if you are:
o a member of the Mellon Senior Management Committee. For
purposes of this restriction only, this prohibition also
applies to those members of the Mellon Senior Management
Committee who are considered Investment Associates.
o employed in any of the following departments of a Mellon
entity other than Dreyfus (see Glossary for definition of
"Dreyfus"):
- Strategic Planning - Finance
- Institutional Banking - Legal
o an associate specifically designated by the Manager of
Corporate Compliance and informed that this prohibition is
applicable to you.
Financial Services Organizations - The term "security
issued by a financial services organization" includes any
security issued by:
<TABLE>
<CAPTION>
<S> <C>
- Commercial Banks - Bank Holding Companies
(other than Mellon) (other than Mellon)
- Thrifts - Savings and Loan Associations
- Insurance Companies - Broker/Dealers
- Investment Advisory Companies - Transfer Agents
- Shareholder Servicing - Other Depository
Companies Institutions
</TABLE>
The term "securities issued by a financial services
organization" DOES NOT INCLUDE securities issued by mutual
funds, variable annuities or insurance policies. Further,
for purposes of determining whether a company is a
financial services organization, subsidiaries and parent
companies are treated as separate issuers.
Effective Date - The foregoing restrictions will be
effective upon adoption of this Policy. Securities of
financial services organizations properly acquired before
the later of the effective date of this Policy or the date
of hire may be maintained or disposed of at the owner's
discretion.
Additional securities of a financial services organization
acquired through the reinvestment of the dividends paid by
such financial services organization through a dividend
reinvestment program (DRIP) are not subject to this
prohibition, provided your election to participate in the
DRIP predates the later of the effective date of this
Policy or date of hire. Optional cash purchases through a
DRIP are subject to this prohibition.
Within 30 days of the later of the effective date of this
Policy or date of becoming subject to this prohibition, all
holdings of securities of financial services organizations
must be disclosed in writing to the Manager of Corporate
Compliance. Periodically, you will be asked to file an
updated disclosure of all your holdings of securities of
financial services organizations.
<PAGE>
CONFLICT OF INTEREST - No Insider Risk Associate may engage
in or recommend any securities transaction that places, or
appears to place, his or her own interests above those of
any customer to whom investment services are rendered,
including mutual funds and managed accounts, or above the
interests of Mellon.
PRECLEARANCE FOR PERSONAL SECURITIES TRANSACTIONS - All
Insider Risk Associates must notify the Manager of
Corporate Compliance in writing and receive preclearance
before they engage in any purchase or sale of a security.
Insider Risk Associates should refer to the provisions
under "Beneficial Ownership" (Section Four, "Restrictions
on Transactions in Mellon Securities"), which are equally
applicable to these provisions.
Exemptions from Requirement to Preclear - Preclearance is
not required for the following transactions:
O purchases or sales of Exempt Securities (see Glossary);
o purchases or sales of municipal bonds;
o purchases or sales effected in any account over which an
associate has no direct or indirect control over the
investment decision-making process (e.g., nondiscretionary
trading accounts). Nondiscretionary trading accounts may
only be maintained, without being subject to preclearance
procedures, when the Manager of Corporate Compliance, after
a thorough review, is satisfied that the account is truly
nondiscretionary;
o transactions that are non-volitional on the part of an
associate (such as stock dividends);
o the sale of stock received upon the exercise of an
associate stock option if the sale is part of a "netting of
shares" or "cashless exercise" administered by the Human
Resources Department (for which the Human Resources
Department will forward information to the Manager of
Corporate Compliance);
o the automatic reinvestment of dividends under a DRIP
(preclearance is required for optional cash purchases under
a DRIP);
o purchases effected upon the exercise of rights issued by an
issuer pro rata to all holders of a class of securities, to
the extent such rights were acquired from such issuer;
o sales of rights acquired from an issuer, as described
above; and/or
O those situations where the Manager of Corporate Compliance
determines, after taking into consideration the particular
facts and circumstances, that prior approval is not
necessary.
Requests for Preclearance - All requests for preclearance
for a securities transaction shall be submitted to the
Manager of Corporate Compliance by completing a
Preclearance Request Form (see Exhibit C1).
The Manager of Corporate Compliance will notify the Insider
Risk Associate whether the request is approved or denied,
without disclosing the reason for such approval or denial.
<PAGE>
Notifications may be given in writing or verbally by the
Manager of Corporate Compliance to the Insider Risk
Associate. A record of such notification will be maintained
by the Manager of Corporate Compliance. However, it shall
be the responsibility of the Insider Risk Associate to
obtain a written record of the Manager of Corporate
Compliance's notification within 24 hours of such
notification. The Insider Risk Associate should retain a
copy of this written record.
As there could be many reasons for preclearance being
granted or denied, Insider Risk Associates should not infer
from the preclearance response anything regarding the
security for which preclearance was requested.
Although making a preclearance request does not obligate an
Insider Risk Associate to do the transaction, it should be
noted that:
o preclearance authorization will expire at the end of the
third business day after it is received (the day
authorization is granted is considered the first business
day);
O preclearance requests should not be made for a
transaction that the Insider Risk Associate does not
intend to make; and
o Insider Risk Associates should not discuss with anyone
else, inside or outside Mellon, the response they received
to a preclearance request.
Every Insider Risk Associate must follow these procedures
or risk serious sanctions, including dismissal. If you have
any questions about these procedures you should consult the
Manager of Corporate Compliance. Interpretive issues that
arise under these procedures shall be decided by, and are
subject to the discretion of, the Manager of Corporate
Compliance.
Restricted List - The Manager of Corporate Compliance will
maintain a list (the "Restricted List") of companies whose
securities are deemed appropriate for implementation of
trading restrictions for Insider Risk Associates.
Restricted List(s) will not be distributed outside of the
Risk Management and Compliance Department. From time to
time, such trading restrictions may be appropriate to
protect Mellon and its Insider Risk Associates from
potential violations, or the appearance of violations, of
securities laws. The inclusion of a company on the
Restricted List provides no indication of the advisability
of an investment in the company's securities or the
existence of material nonpublic information on the company.
Nevertheless, the contents of the Restricted List will be
treated as confidential information to avoid unwarranted
inferences.
To assist the Manager of Corporate Compliance in
identifying companies that may be appropriate for inclusion
on the Restricted List, the department heads of sections in
which Insider Risk Associates are employed will inform the
Manager of Corporate Compliance in writing of any companies
they believe should be included on the Restricted List,
based upon facts known or readily available to such
department heads. Although the reasons for inclusion on the
Restricted List may vary, they could typically include the
following:
o Mellon is involved as a lender, investor or adviser in a
merger, acquisition or financial restructuring involving
the company;
o Mellon is involved as a selling shareholder in a public
distribution of the company's securities;
<PAGE>
o Mellon is involved as an agent in the distribution of the
company's securities;
o Mellon has received material nonpublic information on the
company;
o Mellon is considering the exercise of significant
creditors' rights against the company; or
o The company is a Mellon borrower in Credit Recovery.
Department heads of sections in which Insider Risk
Associates are employed are also responsible for notifying
the Manager of Corporate Compliance in writing of any
change in circumstances making it appropriate to remove a
company from the Restricted List.
PERSONAL SECURITIES TRANSACTIONS REPORTS
o Brokerage Accounts - All Insider Risk Associates are
required to instruct their brokers to submit directly to
the Manager of Corporate Compliance copies of all trade
confirmations and statements relating to their account. An
example of an instruction letter to a broker is contained
in Exhibit B1.
o Report of Transactions in Mellon Securities - Insider Risk
Associates must also report in writing to the Manager of
Corporate Compliance within ten calendar days whenever they
purchase or sell Mellon securities if the transaction was
not through a brokerage account as described above.
Purchases and sales of Mellon securities include the
following:
DRIP Optional Cash Purchases - Optional cash purchases
under Mellon's Dividend Reinvestment and Common Stock
Purchase Plan (the "Mellon DRIP").
Stock Options - The sale of stock received upon the
exercise of an associate stock option unless the sale is
part of a "netting of shares" or "cashless exercise"
administered by the Human Resources Department (for which
the Human Resources Department will forward information to
the Manager of Corporate Compliance).
It should be noted that the reinvestment of dividends under
the DRIP, changes in elections under Mellon's Retirement
Savings Plan, the receipt of stock under Mellon's
Restricted Stock Award Plan and the receipt or exercise of
options under Mellon's Long-Term Profit Incentive Plan are
not considered purchases or sales for the purpose of this
reporting requirement.
An example of a written report to the Manager of Corporate
Compliance is contained in Exhibit A.
CONFIDENTIAL TREATMENT
THE MANAGER OF CORPORATE COMPLIANCE WILL USE HIS OR HER
BEST EFFORTS TO ASSURE THAT ALL REQUESTS FOR PRECLEARANCE,
ALL PERSONAL SECURITIES TRANSACTION REPORTS AND ALL REPORTS
OF SECURITIES HOLDINGS ARE TREATED AS "PERSONAL AND
CONFIDENTIAL." HOWEVER, SUCH DOCUMENTS WILL BE AVAILABLE
FOR INSPECTION BY APPROPRIATE REGULATORY AGENCIES AND BY
OTHER PARTIES WITHIN AND OUTSIDE MELLON AS ARE NECESSARY TO
EVALUATE COMPLIANCE WITH OR SANCTIONS UNDER THIS POLICY.
<PAGE>
PART III - APPLICABLE TO
INVESTMENT ASSOCIATES ONLY
- ------------------------------
Because of their particular responsibilities, Investment
Associates are subject to different preclearance and
personal securities reporting requirements as discussed
below.
SPECIAL STANDARDS OF CONDUCT FOR INVESTMENT ASSOCIATES
Conflict of Interest - No Investment Associate may
recommend a securities transaction for a Mellon customer to
whom a fiduciary duty is owed, or for Mellon, without
disclosing any interest he or she has in such securities or
issuer (other than an interest in publicly traded
securities where the total investment is equal to or less
than $25,000), including:
o any direct or indirect beneficial ownership of any
securities of such issuer;
o any contemplated transaction by the Investment Associate in
such securities;
o any position with such issuer or its affiliates; and
o any present or proposed business relationship between such
issuer or its affiliates and the Investment Associate or
any party in which the Investment Associate has a
beneficial ownership interest (see "Beneficial Ownership"
in Section Four, "Restrictions On Transactions in Mellon
Securities").
Portfolio Information - No Investment Associate may divulge
the current portfolio positions, or current or anticipated
portfolio transactions, programs or studies, of Mellon or
any Mellon customer to anyone unless it is properly within
his or her job responsibilities to do so.
Material Nonpublic Information - No Investment Associate
may engage in or recommend a securities transaction, for
his or her own benefit or for the benefit of others,
including Mellon or its customers, while in possession of
material nonpublic information regarding such securities.
No Investment Associate may communicate material nonpublic
information to others unless it is properly within his or
her job responsibilities to do so.
Short-Term Trading - Any Investment Associate who purchases
and sells, or sells and purchases, the same (or equivalent)
securities within any 60-calendar-day period is required to
disgorge all profits realized on such transaction in
accordance with procedures established by senior
management. For this purpose, securities will be deemed to
be equivalent if one is convertible into the other, if one
entails a right to purchase or sell the other, or if the
value of one is expressly dependent on the value of the
other (e.g., derivative securities).
Additional Restrictions For Dreyfus Associates and
Associates of Mellon Entities Registered Under The
Investment Advisers Act of 1940 ONLY ("40 Act
Associates")
o Outside Activities - No 40 Act associate may serve on the
board of directors/trustees or as a general partner of any
publicly traded company (other than Mellon) without the
prior approval of the Manager of Corporate Compliance.
<PAGE>
o Gifts - All 40 Act associates are prohibited from accepting
gifts from outside companies, or their representatives,
with an exception for gifts of (1) a de minimis value and
(2) an occasional meal, a ticket to a sporting event or the
theater, or comparable entertainment for the 40 Act
associate and, if appropriate, a guest, which is neither so
frequent nor extensive as to raise any question of
impropriety. A gift shall be considered de minimis if it
does not exceed an annual amount per person fixed
periodically by the National Association of Securities
Dealers, which is currently $100 per person.
o Blackout Period - 40 Act associates will not be given
clearance to execute a transaction in any security that is
being considered for purchase or sale by an affiliated
investment company, managed account or trust, for which a
pending buy or sell order for such affiliated account is
pending, and for two business days after the transaction in
such security for such affiliated account has been
effected. This provision does not apply to transactions
effected or contemplated by index funds.
In addition, portfolio managers for the investment
companies are prohibited from buying or selling a security
within seven calendar days before and after such investment
company trades in that security. Any violation of the
foregoing will require the violator to disgorge all profit
realized with respect to such transaction.
PRECLEARANCE FOR PERSONAL SECURITIES TRANSACTIONS - All
Investment Associates must notify the Preclearance
Compliance Officer (see Glossary) in writing and receive
preclearance before they engage in any purchase or sale of
a security.
Exemptions from Requirement to Preclear - Preclearance is
not required for the following transactions:
o purchases or sales of "Exempt Securities" (see Glossary);
o purchases or sales effected in any account over which an
associate has no direct or indirect control over the
investment decision-making process (i.e., nondiscretionary
trading accounts). Nondiscretionary trading accounts may
only be maintained, without being subject to preclearance
procedures, when the Preclearance Compliance Officer, after
a thorough review, is satisfied that the account is truly
nondiscretionary;
O transactions which are non-volitional on the part of an
associate (such as stock dividends);
o the sale of stock received upon the exercise of an
associate stock option if the sale is part of a "netting of
shares" or "cashless exercise" administered by the Human
Resources Department (for which the Human Resources
Department will forward information to the manager of
Corporate Compliance);
o purchases which are part of an automatic reinvestment of
dividends under a DRIP (Preclearance is required for
optional cash purchases under a DRIP);
o purchases effected upon the exercise of rights issued by an
issuer pro rata to all holders of a class of securities, to
the extent such rights were acquired from such issuer;
o sales of rights acquired from an issuer, as described
above; and/or
o those situations where the Preclearance Compliance Officer
determines, after taking into consideration the particular
facts and circumstances, that prior approval is not
necessary.
<PAGE>
Requests for Preclearance - All requests for preclearance
for a securities transaction shall be submitted to the
Preclearance Compliance Officer by completing a
Preclearance Request Form. (Investment Associates other
than Dreyfus associates are to use the Preclearance Request
Form shown as Exhibit C1. Dreyfus associates are to use the
Preclearance Request Form shown as Exhibit C2.)
The Preclearance Compliance Officer will notify the
Investment Associate whether the request is approved or
denied without disclosing the reason for such approval or
denial.
Notifications may be given in writing or verbally by the
Preclearance Compliance Officer to the Investment
Associate. A record of such notification will be maintained
by the Preclearance Compliance Officer. However, it shall
be the responsibility of the Investment Associate to obtain
a written record of the Preclearance Compliance Officer's
notification within 24 hours of such notification. The
Investment Associate should retain a copy of this written
record.
As there could be many reasons for preclearance being
granted or denied, Investment Associates should not infer
from the preclearance response anything regarding the
security for which preclearance was requested.
Although making a preclearance request does not obligate an
Investment Associate to do the transaction, it should be
noted that:
o preclearance authorization will expire at the end of the
day on which preclearance is given;
o preclearance requests should not be made for a transaction
that the Investment Associate does not intend to make; and
o Investment Associates should not discuss with anyone else,
inside or outside Mellon, the response the Investment
Associate received to a preclearance request.
Every Investment Associate must follow these procedures or
risk serious sanctions, including dismissal. If you have
any questions about these procedures, consult the
Preclearance Compliance Officer. Interpretive issues that
arise under these procedures shall be decided by, and are
subject to the discretion of, the Manager of Corporate
Compliance.
Restricted List - Each Preclearance Compliance Officer will
maintain a list (the "Restricted List") of companies whose
securities are deemed appropriate for implementation of
trading restrictions for Investment Associates in their
area. From time to time, such trading restrictions may be
appropriate to protect Mellon and its Investment Associates
from potential violations, or the appearance of violations,
of securities laws. The inclusion of a company on the
Restricted List provides no indication of the advisability
of an investment in the company's securities or the
existence of material nonpublic information on the company.
Nevertheless, the contents of the Restricted List will be
treated as confidential information in order to avoid
unwarranted inferences.
In order to assist the Preclearance Compliance Officer in
identifying companies that may be appropriate for inclusion
on the Restricted List, the head of the
entity/department/area in which Investment Associates are
employed will inform the appropriate Preclearance
Compliance Officer in writing of any companies that they
believe should be included on the Restricted List based
upon facts known or readily available to such department
heads.
<PAGE>
PERSONAL SECURITIES TRANSACTIONS REPORTS
o Brokerage Accounts - All Investment Associates are required
to instruct their brokers to submit directly to the Manager
of Corporate Compliance copies of all trade confirmations
and statements relating to their account. Examples of
instruction letters to a broker are contained in Exhibits
B1 and B2.
o Report of Transactions in Mellon Securities - Investment
Associates must also report in writing to the Manager of
Corporate Compliance within ten calendar days whenever they
purchase or sell Mellon securities if the transaction was
not through a brokerage account as described above.
Purchases and sales of Mellon securities include the
following:
DRIP Optional Cash Purchases - Optional cash purchases
under Mellon's Dividend Reinvestment and Common Stock
Purchase Plan (the "Mellon DRIP").
Stock Options - The sale of stock received upon the
exercise of an associate stock option unless the sale is
part of a "netting of shares" or "cashless exercise"
administered by the Human Resources Department (for which
the Human Resources Department will forward information to
the Manager of Corporate Compliance).
It should be noted that the reinvestment of dividends under
the DRIP, changes in elections under Mellon's Retirement
Savings Plan, the receipt of stock under Mellon's
Restricted Stock Award Plan, and the receipt or exercise of
options under Mellon's Long-Term Profit Incentive Plan are
not considered purchases or sales for the purpose of this
reporting requirement.
An example of a written report to the Manager of Corporate
Compliance is contained in Exhibit A.
o Statement of Securities Holdings - Within ten days of
receiving this Policy and on an annual basis thereafter,
all Investment Associates must submit to the Manager of
Corporate Compliance a statement of all securities in which
they presently have any direct or indirect beneficial
ownership other than Exempt Securities, as defined in the
Glossary. Investment Associates should refer to "Beneficial
Ownership" in Section Four, "Restrictions on Transactions
in Mellon Securities," which is also applicable to
Investment Associates. Such statements should be in the
format shown in Exhibit D. The annual report must be
submitted by January 31 and must report all securities
holdings other than Exempt Securities. The annual statement
of securities holdings contains an acknowledgment that the
Investment Associate has read and complied with this
Policy.
o Special Requirement with Respect to Affiliated Investment
Companies - The portfolio managers, research analysts and
other Investment Associates specifically designated by the
Manager of Corporate Compliance are required within ten
calendar days of receiving this Policy (and by no later
than ten calendar days after the end of each calendar
quarter) to report every transaction in the securities
issued by an affiliated investment company occurring in an
account in which the Investment Associate has a beneficial
ownership interest. The quarterly reporting requirement may
be satisfied by notifying the Manager of Corporate
Compliance of the name of the investment company, account
name and account number for which such quarterly reports
must be submitted.
<PAGE>
CONFIDENTIAL TREATMENT
THE PRECLEARANCE COMPLIANCE OFFICER WILL USE HIS OR HER
BEST EFFORTS TO ASSURE THAT ALL REQUESTS FOR PRECLEARANCE,
ALL PERSONAL SECURITIES TRANSACTION REPORTS AND ALL REPORTS
OF SECURITIES HOLDINGS ARE TREATED AS "PERSONAL AND
CONFIDENTIAL." HOWEVER, SUCH DOCUMENTS WILL BE AVAILABLE
FOR INSPECTION BY APPROPRIATE REGULATORY AGENCIES, AND BY
OTHER PARTIES WITHIN AND OUTSIDE MELLON AS ARE NECESSARY TO
EVALUATE COMPLIANCE WITH OR SANCTIONS UNDER THIS POLICY.
DOCUMENTS RECEIVED FROM DREYFUS ASSOCIATES ARE ALSO
AVAILABLE FOR INSPECTION BY THE BOARDS OF DIRECTORS OF
DREYFUS AND BY THE BOARDS OF DIRECTORS (OR TRUSTEES OR
MANAGING GENERAL PARTNERS, AS APPLICABLE) OF THE INVESTMENT
COMPANIES MANAGED OR ADMINISTERED BY DREYFUS.
<PAGE>
PART IV - APPLICABLE TO
OTHER ASSOCIATES ONLY
- ------------------------------
PRECLEARANCE FOR PERSONAL SECURITIES TRANSACTIONS - Except
for private placements, Other Associates are permitted to
engage in personal securities transactions without
obtaining prior approval from the Manager of Corporate
Compliance (for preclearance of private placements, use the
Preclearance Request Form shown as Exhibit C1.)
PERSONAL SECURITIES TRANSACTIONS REPORTS - Other Associates
are not required to report their personal securities
transactions other than margin transactions and
transactions involving Mellon securities as discussed
below. Other Associates are required to instruct their
brokers to submit directly to the Manager of Corporate
Compliance copies of all confirmations and statements
pertaining to margin accounts. Examples of an instruction
letter to a broker are shown in Exhibit B1.
Report of Transactions in Mellon Securities - Other
Associates must report in writing to the Manager of
Corporate Compliance within ten calendar days whenever they
purchase or sell Mellon securities. Purchases and sales of
Mellon securities include the following:
o DRIP Optional Cash Purchases - Optional cash purchases
under Mellon's Dividend Reinvestment and Common Stock
Purchase Plan (the "Mellon DRIP").
o Stock Options - The sale of stock received upon the
exercise of an associate stock option unless the sale is
part of a "netting of shares" or "cashless exercise"
administered by the Human Resources Department (for which
the Human Resources Department will forward information to
the Manager of Corporate Compliance).
It should be noted that the reinvestment of dividends under
the DRIP, changes in elections under Mellon's Retirement
Savings Plan, the receipt of stock under Mellon's
Restricted Stock Award Plan and the receipt or exercise of
options under Mellon's Long-Term Profit Incentive Plan are
not considered purchases or sales for the purpose of this
reporting requirement.
An example of a written report to the Manager of Corporate
Compliance is contained in Exhibit A.
RESTRICTIONS ON TRANSACTIONS IN OTHER SECURITIES
Margin Transactions - Prior to establishing a margin
account, Other Associates must obtain the written
permission of the Manager of Corporate Compliance. Other
Associates having a margin account prior to the effective
date of this Policy must notify the Manager of Corporate
Compliance of the existence of such account.
<PAGE>
All associates having margin accounts, other than described
below, must designate the Manager of Corporate Compliance
as an interested party on each account. Associates must
ensure that the Manager of Corporate Compliance promptly
receives copies of all trade confirmations and statements
relating to the accounts directly from the broker. If
requested by a brokerage firm, please contact the Manager
of Corporate Compliance to obtain a letter (sometimes
referred to as a "407 letter") granting permission to
maintain a margin account. Trade confirmations and
statements are not required on margin accounts established
at Dreyfus Investment Services Corporation for the sole
purpose of cashless exercises of Mellon employee stock
options. In addition, products may be offered by a
broker/dealer that, because of their characteristics, are
considered margin accounts but have been determined by the
Manager of Corporate Compliance to be outside the scope of
this Policy (e.g., a Cash Management account which provides
overdraft protection for the customer). Any questions
regarding the establishment, use and reporting of margin
accounts should be directed to the Manager of Corporate
Compliance. An example of an instruction letter to a broker
is shown in Exhibit B1.
Private Placements - Other Associates are prohibited from
acquiring any security in a private placement unless they
obtain the prior written approval of the Manager of
Corporate Compliance and the Associate's department head.
Approval must be given by both of the aforementioned
persons for the acquisition to be considered approved.
As there could be many reasons for preclearance being
granted or denied, Other Associates should not infer from
the preclearance response anything regarding the security
for which preclearance was requested.
Although making a preclearance request does not obligate an
Other Associate to do the transaction, it should be noted
that:
o preclearance authorization will expire at the end of the
third business day after it is received (the day
authorization is granted is considered the first business
day);
o preclearance requests should not be made for a transaction
that the Other Associate does not intend to make; and
o Other Associates should not discuss with anyone else,
inside or outside Mellon, the response they received to a
preclearance request.
Every Other Associate must follow these procedures or risk
serious sanctions, including dismissal. If you have any
questions about these procedures you should consult the
Manager of Corporate Compliance. Interpretive issues that
arise under these procedures shall be decided by, and are
subject to the discretion of, the Manager of Corporate
Compliance.
CONFIDENTIAL TREATMENT
THE MANAGER OF CORPORATE COMPLIANCE WILL USE HIS OR HER
BEST EFFORTS TO ASSURE THAT ALL REQUESTS FOR PRECLEARANCE,
ALL PERSONAL SECURITIES TRANSACTION REPORTS AND ALL REPORTS
OF SECURITIES HOLDINGS ARE TREATED AS "PERSONAL AND
CONFIDENTIAL." HOWEVER, SUCH DOCUMENTS WILL BE AVAILABLE
FOR INSPECTION BY APPROPRIATE REGULATORY AGENCIES AND OTHER
PARTIES WITHIN AND OUTSIDE MELLON AS ARE NECESSARY TO
EVALUATE COMPLIANCE WITH OR SANCTIONS UNDER THIS POLICY.
<PAGE>
PART V - APPLICABLE TO
NONMANAGEMENT BOARD MEMBER
- ------------------------------
NONMANAGEMENT BOARD MEMBER -
You are considered to be a Nonmanagement Board Member if
you are:
o a director of Dreyfus who is not also an officer or
employee of Dreyfus ("Dreyfus Board Member"); or
o a director, trustee or managing general partner of any
investment company who is not also an officer or employee
of Dreyfus ("Mutual Fund Board Member").
The term "Independent" Mutual Fund Board Member means those
Mutual Fund Board Members who are not deemed "interested
persons" of an investment company, as defined by the
Investment Company Act of 1940, as amended.
STANDARDS OF CONDUCT FOR NONMANAGEMENT BOARD MEMBER
Outside Activities - Nonmanagement Board Members are
prohibited from:
o accepting nomination or serving as a director, trustee or
managing general partner of an investment company not
advised by Dreyfus, without the express prior approval of
the board of directors of Dreyfus and the board of
directors/trustees or managing general partners of the
pertinent Dreyfus-managed fund(s) for which a Nonmanagement
Board Member serves as a director, trustee or managing
general partner;
o accepting employment with or acting as a consultant to any
person acting as a registered investment adviser to an
investment company without the express prior approval of
the board of directors of Dreyfus;
o owning Mellon securities if the Nonmanagement Board Member
is an "Independent" Mutual Fund Board Member, (since that
would destroy his or her "independent" status); and/or
o buying or selling Mellon's publicly traded securities
during a blackout period, which begins the 16th day of the
last month of each calendar quarter and ends three business
days after Mellon publicly announces the financial results
for that quarter.
Insider Trading and Tipping - The provisions set forth in
Section Two, "Insider Trading and Tipping," are applicable
to Nonmanagement Board Members.
<PAGE>
Conflict of Interest - No Nonmanagement Board Member may
recommend a securities transaction for Mellon, Dreyfus or
any Dreyfus-managed fund without disclosing any interest he
or she has in such securities or issuer thereof (other than
an interest in publicly traded securities where the total
investment is less than or equal to $25,000), including:
o any direct or indirect beneficial ownership of any
securities of such issuer;
o any contemplated transaction by the Nonmanagement Board
Member in such securities;
o any position with such issuer or its affiliates; and
o any present or proposed business relationship between such
issuer or its affiliates and the Nonmanagement Board Member
or any party in which the Nonmanagement Board Member has a
beneficial ownership interest (see "Beneficial Ownership",
Section Four, "Restrictions on Transaction in Mellon
Securities").
Portfolio Information - No Nonmanagement Board Member may
divulge the current portfolio positions, or current or
anticipated portfolio transactions, programs or studies, of
Mellon, Dreyfus or any Dreyfus-managed fund, to anyone
unless it is properly within his or her responsibilities as
a Nonmanagement Board Member to do so.
Material Nonpublic Information - No Nonmanagement Board
Member may engage in or recommend any securities
transaction, for his or her own benefit or for the benefit
of others, including Mellon, Dreyfus or any Dreyfus-managed
fund, while in possession of material nonpublic
information. No Nonmanagement Board Member may communicate
material nonpublic information to others unless it is
properly within his or her responsibilities as a
Nonmanagement Board Member to do so.
PRECLEARANCE FOR PERSONAL SECURITIES TRANSACTIONS -
Nonmanagement Board Members are permitted to engage in
personal securities transactions without obtaining prior
approval from the Preclearance Compliance Officer.
<PAGE>
PERSONAL SECURITY TRANSACTIONS REPORTS -
o "Independent" Mutual Fund Board Members - Any "Independent"
Mutual Fund Board Members, as defined above, who effects a
securities transaction where he or she knew, or in the
ordinary course of fulfilling his or her official duties
should have known, that during the 15-day period
immediately preceding or after the date of such
transaction, the same security was purchased or sold, or
was being considered for purchase or sale by Dreyfus
(including any investment company or other account managed
by Dreyfus), are required to report such personal
securities transaction. In the event a personal securities
transaction report is required, it must be submitted to the
Preclearance Compliance Officer not later than ten days
after the end of the calendar quarter in which the
transaction to which the report relates was effected. The
report must include the date of the transaction, the title
and number of shares or principal amount of the security,
the nature of the transaction (e.g., purchase, sale or any
other type of acquisition or disposition), the price at
which the transaction was effected and the name of the
broker or other entity with or through whom the transaction
was effected. This reporting requirement can be satisfied
by sending a copy of the confirmation statement regarding
such transactions to the Preclearance Compliance Officer
within the time period specified. Notwithstanding the
foregoing, personal securities transaction reports are not
required with respect to any securities transaction
described in "Exemption from the Requirement to Preclear"
in Part III.
o Dreyfus Board Members and "Interested" Mutual Fund Board
Members - Dreyfus Board Members and Mutual Fund Board
Members who are "interested persons" of an investment
company, as defined by the Investment Company Act of 1940,
are required to report their personal securities
transactions. Personal securities transaction reports are
required with respect to any securities transaction other
than those described in "Exemptions from Requirement to
Preclear" on Page 21. Personal securities transaction
reports are required to be submitted to the Preclearance
Compliance Officer not later than ten days after the end of
the calendar quarter in which the transaction to which the
report relates was effected. The report must include the
date of the transaction, the title and number of shares or
principal amount of the security, the nature of the
transaction (e.g., purchase, sale or any other type of
acquisition or disposition), the price at which the
transaction was effected and the name of the broker or
other entity with or through whom the transaction was
effected. This reporting requirement can be satisfied by
sending a copy of the confirmation statement regarding such
transactions to the Preclearance Compliance Officer within
the time period specified.
CONFIDENTIAL TREATMENT
THE PRECLEARANCE COMPLIANCE OFFICER WILL USE HIS OR HER
BEST EFFORTS TO ASSURE THAT ALL PERSONAL SECURITIES
TRANSACTION REPORTS ARE TREATED AS "PERSONAL AND
CONFIDENTIAL." HOWEVER, SUCH DOCUMENTS WILL BE AVAILABLE
FOR INSPECTION BY APPROPRIATE REGULATORY AGENCIES AND OTHER
PARTIES WITHIN AND OUTSIDE MELLON AS ARE NECESSARY TO
EVALUATE COMPLIANCE WITH OR SANCTIONS UNDER THIS POLICY.
<PAGE>
GLOSSARY
- ------------------------------
DEFINITIONS
o APPROVAL - written consent or written notice of
nonobjection.
o ASSOCIATE - any employee of Mellon Bank Corporation or its
direct or indirect subsidiaries; does not include outside
consultants or temporary help.
o BENEFICIAL OWNERSHIP - securities owned of record or held
in the associate's name are generally considered to be
beneficially owned by the associate.
Securities held in the name of any other person are deemed
to be beneficially owned by the associate if by reason of
any contract, understanding, relationship, agreement or
other arrangement, the associate obtains therefrom benefits
substantially equivalent to those of ownership, including
the power to vote, or to direct the disposition of, such
securities. Beneficial ownership includes securities held
by others for the associate's benefit (regardless of record
ownership), e.g. securities held for the associate or
members of the associate's immediate family, defined below,
by agents, custodians, brokers, trustees, executors or
other administrators; securities owned by the associate,
but which have not been transferred into the associate's
name on the books of the company; securities which the
associate has pledged; or securities owned by a corporation
that should be regarded as the associate's personal holding
corporation. As a natural person, beneficial ownership is
deemed to include securities held in the name or for the
benefit of the associate's immediate family, which includes
the associate's spouse, the associate's minor children and
stepchildren and the associate's relatives or the relatives
of the associate's spouse who are sharing the associate's
home, unless because of countervailing circumstances, the
associate does not enjoy benefits substantially equivalent
to those of ownership. Benefits substantially equivalent to
ownership include, for example, application of the income
derived from such securities to maintain a common home,
meeting expenses that such person otherwise would meet from
other sources, and the ability to exercise a controlling
influence over the purchase, sale or voting of such
securities. An associate is also deemed the beneficial
owner of securities held in the name of some other person,
even though the associate does not obtain benefits of
ownership, if the associate can vest or revest title in
himself at once, or at some future time.
In addition, a person will be deemed the beneficial owner
of a security if he has the right to acquire beneficial
ownership of such security at any time (within 60 days)
including but not limited to any right to acquire: (1)
through the exercise of any option, warrant or right; (2)
through the conversion of a security; or (3) pursuant to
the power to revoke a trust, nondiscretionary account or
similar arrangement.
<PAGE>
With respect to ownership of securities held in trust,
beneficial ownership includes ownership of securities as a
trustee in instances where either the associate as trustee
or a member of the associate's "immediate family" has a
vested interest in the income or corpus of the trust, the
ownership by the associate of a vested beneficial interest
in the trust and the ownership of securities as a settlor
of a trust in which the associate as the settlor has the
power to revoke the trust without obtaining the consent of
the beneficiaries. Certain exemptions to these trust
beneficial ownership rules exist, including an exemption
for instances where beneficial ownership is imposed solely
by reason of the associate being settlor or beneficiary of
the securities held in trust and the ownership, acquisition
and disposition of such securities by the trust is made
without the associate's prior approval as settlor or
beneficiary. "Immediate family" of an associate as trustee
means the associate's son or daughter (including any
legally adopted children) or any descendant of either, the
associate's stepson or stepdaughter, the associate's father
or mother or any ancestor of either, the associate's
stepfather or stepmother and his spouse.
To the extent that stockholders of a company use it as a
personal trading or investment medium and the company has
no other substantial business, stockholders are regarded as
beneficial owners, to the extent of their respective
interests, of the stock thus invested or traded in. A
general partner in a partnership is considered to have
indirect beneficial ownership in the securities held by the
partnership to the extent of his pro rata interest in the
partnership. Indirect beneficial ownership is not, however,
considered to exist solely by reason of an indirect
interest in portfolio securities held by any holding
company registered under the Public Utility Holding Company
Act of 1935, a pension or retirement plan holding
securities of an issuer whose employees generally are
beneficiaries of the plan and a business trust with over 25
beneficiaries.
Any person who, directly or indirectly, creates or uses a
trust, proxy, power of attorney, pooling arrangement or any
other contract, arrangement or device with the purpose or
effect of divesting such person of beneficial ownership as
part of a plan or scheme to evade the reporting
requirements of the Securities Exchange Act of 1934 shall
be deemed the beneficial owner of such security.
The final determination of beneficial ownership is a
question to be determined in light of the facts of a
particular case. Thus, while the associate may include
security holdings of other members of his family, the
associate may nonetheless disclaim beneficial ownership of
such securities.
o "CHINESE WALL" POLICY - procedures designed to restrict the
flow of information within Mellon from units or individuals
who are likely to receive material nonpublic information to
units or individuals who trade in securities or provide
investment advice. (see pages 12-14).
o CORPORATION - Mellon Bank Corporation.
o DREYFUS - The Dreyfus Corporation and its subsidiaries.
o DREYFUS ASSOCIATE - any employee of Dreyfus; does not
include outside consultants or temporary help.
<PAGE>
o EXEMPT SECURITIES - Exempt Securities are defined as:
- securities issued or guaranteed by the United States
government or agencies or instrumentalities;
- bankers' acceptances;
- bank certificates of deposit and time deposits;
- commercial paper;
- repurchase agreements; and
- securities issued by open-end investment companies.
o GENERAL COUNSEL - General Counsel of Mellon Bank
Corporation or any person to whom relevant authority is
delegated by the General Counsel.
o INDEX FUND - an investment company which seeks to mirror
the performance of the general market by investing in the
same stocks (and in the same proportion) as a broad-based
market index.
o INITIAL PUBLIC OFFERING (IPO) - the first offering of a
company's securities to the public.
o INVESTMENT COMPANY - a company that issues securities that
represent an undivided interest in the net assets held by
the company. Mutual funds are investment companies that
issue and sell redeemable securities representing an
undivided interest in the net assets of the company.
o MANAGER OF CORPORATE COMPLIANCE - - the associate within
the Risk Management and Compliance Department of Mellon
Bank Corporation who is responsible for administering the
Confidential Information and Securities Trading Policy, or
any person to whom relevant authority is delegated by the
Manager of Corporate Compliance.
o MELLON - Mellon Bank Corporation and all of its direct and
indirect subsidiaries.
o NAKED OPTION - an option sold by the investor which
obligates him or her to sell a security which he or she
does not own.
o NONDISCRETIONARY TRADING ACCOUNT - an account over which
the associated person has no direct or indirect control
over the investment decision-making process.
o OPTION - a security which gives the investor the right but
not the obligation to buy or sell a specific security at a
specified price within a specified time.
o PRECLEARANCE COMPLIANCE OFFICER - a person designated by
the Manager of Corporate Compliance, to administer, among
other things, associates' preclearance request for a
specific business unit.
o PRIVATE PLACEMENT - an offering of securities that is
exempt from registration under the Securities Act of 1933
because it does not constitute a public offering.
o SENIOR MANAGEMENT COMMITTEE - the Senior Management
Committee of Mellon Bank Corporation.
o SHORT SALE - the sale of a security that is not owned by
the seller at the time of the trade.
<PAGE>
INDEX OF EXHIBITS
- ------------------------------
EXHIBIT A SAMPLE REPORT TO MANAGER OF CORPORATE COMPLIANCE
EXHIBIT B SAMPLE INSTRUCTION LETTER TO BROKER
EXHIBIT C PRECLEARANCE REQUEST FORM
EXHIBIT D PERSONAL SECURITIES HOLDINGS FORM
<PAGE>
EXHIBIT A
- ------------------------------
SAMPLE REPORT TO MANAGER OF CORPORATE COMPLIANCE
- --------------------------------------------------------------------------------
MELLON INTEROFFICE
MEMORANDUM
Date: From: Associate
To: Manager, Corporate Compliance Dept:
Aim #:
Aim #: 151-4342 Phone:
Fax:
- --------------------------------------------------------------------------------
RE: REPORT OF SECURITIES TRADE
Type of Associate: ____________ Insider Risk
____________ Investment
____________ Other
Type of Security: ____________ Mellon Bank Corporation
____________ Mellon Bank Corporation - optional
cash purchases under Dividend
Reinvestment and Common Stock
Purchase Plan
____________ Mellon Bank Corporation - exercise
of an employee stock option
Attached is a copy of the confirmation slip for a securities trade I
engaged in on _____________________, 19xx.
or
On _____________________, 19xx, I (purchased/sold)__________________
shares of ___________________________ through (broker). I will
arrange to have a copy of the confirmation slip for this trade
delivered to you as soon as possible.
<PAGE>
EXHIBIT B1
- ------------------------------
FOR NON-DREYFUS ASSOCIATES
Date
Broker ABC
Street Address
City, State ZIP
Re: John Smith & Mary Smith
Account No. xxxxxxxxxxxxx
In connection with my existing brokerage accounts at your firm
noted above, please be advised that the Risk Management and
Compliance Department of Mellon Bank should be noted as an
"Interested Party" with respect to my accounts. They should,
therefore, be sent copies of all trade confirmations and account
statements relating to my account.
Please send the requested documentation ensuring the account
holder's name appears on all correspondence to:
Manager, Corporate Compliance
Mellon Bank
P.O. Box 3130
Pittsburgh, PA 15230-3130
Thank you for your cooperation in this request.
Sincerely yours,
Associate
cc: Manager, Corporate Compliance (151-4342)
<PAGE>
EXHIBIT B2
- ------------------------------
FOR DREYFUS ASSOCIATES
Date
Broker ABC
Street Address
City, State ZIP
Re: John Smith & Mary Smith
Account No. xxxxxxxxxxxxx
In connection with my existing brokerage accounts at your firm
noted above, please be advised that the Risk Management and
Compliance Department of Dreyfus Corporation should be noted as an
"Interested Party" with respect to my accounts. They should,
therefore, be sent copies of all trade confirmations and account
statements relating to my account.
Please send the requested documentation ensuring the account
holder's name appears on all correspondence to:
Compliance Officer at The Dreyfus Corporation
200 Park Avenue
Legal Department
New York, NY 10166
Thank you for your cooperation in this request.
Sincerely yours,
Associate
cc: Dreyfus Compliance
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C> <C> <C>
EXHIBIT C1
- ------------------------------
PRECLEARANCE REQUEST FORM Non Dreyfus Associates
====================================================================================================
To: Manager, Corporate Compliance 151-4342 (All Insider and Other Associates)
Designated Preclearance Compliance Officer (All Investment Associates excluding Dreyfus)
- ----------------------------------------------------------------------------------------------------
Associate Name: Title: Date:
- ----------------------------------------------------------------------------------------------------
Phone #: AIM #: Social Security #: Department:
- ----------------------------------------------------------------------------------------------------
====================================================================================================
ACCOUNT INFORMATION
- ----------------------------------------------------------------------------------------------------
Account Name: Account Number: Name of Broker/Bank:
- ----------------------------------------------------------------------------------------------------
Relationship to registered owner(s) (if other than associate)
- ----------------------------------------------------------------------------------------------------
I hereby request approval to execute the following trade in the above account:
====================================================================================================
TRANSACTION DETAIL
- ----------------------------------------------------------------------------------------------------
Buy: Sell: Security/Contract: No. of Shares:
- ----------------------------------------------------------------------------------------------------
If sale, date acquired: Margin Transaction: Initial Public Offering: Private Placement:
/ / Yes / / Yes / / Yes
- ----------------------------------------------------------------------------------------------------
====================================================================================================
DISCLOSURE STATEMENT
- ----------------------------------------------------------------------------------------------------
I hereby represent that, to the best of my knowledge, neither I nor the registered account holder is
(1) attempting to benefit personally from any existing business relationship between the issuer and
Mellon or any Mellon-related fund or affiliate; (2) engaging in any manipulative or deceptive
trading activity; (3) in possession of any material non-public information concerning the security
to which is request relates.
- ----------------------------------------------------------------------------------------------------
Associate Signature: Date:
- ----------------------------------------------------------------------------------------------------
====================================================================================================
COMPLIANCE OFFICER USE ONLY
- ----------------------------------------------------------------------------------------------------
Approved: Disapproved: Authorized Signatory: Date:
- ----------------------------------------------------------------------------------------------------
Comments:
- ----------------------------------------------------------------------------------------------------
Note: This preclearance will lapse at the end of the day on __________________, 19__.
If you decide not to effect the trade, please notify me.
- ----------------------------------------------------------------------------------------------------
Date: By:
- ----------------------------------------------------------------------------------------------------
<PAGE>
EXHIBIT C2
- ------------------------------
PRECLEARANCE REQUEST FORM Dreyfus Associates Only
====================================================================================================
To: Dreyfus Compliance Officer
- ----------------------------------------------------------------------------------------------------
Associate Name: Title: Date:
- ----------------------------------------------------------------------------------------------------
Phone #: AIM #: Social Security #: Department:
- ----------------------------------------------------------------------------------------------------
====================================================================================================
ACCOUNT INFORMATION
- ----------------------------------------------------------------------------------------------------
Account Name: Account Number: Name of Broker/Bank:
- ----------------------------------------------------------------------------------------------------
Relationship to registered owner(s) (if other than associate)
- ----------------------------------------------------------------------------------------------------
I hereby request approval to execute the following trade in the above account:
====================================================================================================
TRANSACTION DETAIL
- ----------------------------------------------------------------------------------------------------
Buy: Sell: Security/Contract: Symbol:
- ----------------------------------------------------------------------------------------------------
Amount: Current Market Price: If sale, date acquired: Margin Transaction:
- ----------------------------------------------------------------------------------------------------
Is this a New Issue? Is this a Private Placement?
/ / Yes / / No / / Yes / / No
- ----------------------------------------------------------------------------------------------------
Reason for Transaction, identify source:
- ----------------------------------------------------------------------------------------------------
====================================================================================================
DISCLOSURE STATEMENT
- ----------------------------------------------------------------------------------------------------
I hereby represent that, to the best of my knowledge, neither I nor the registered account holder is
(1) attempting to benefit personally from any existing business relationship between the issuer and
Mellon or any Mellon-related fund or affiliate; (2) engaging in any manipulative or deceptive
trading activity; (3) in possession of any material non-public information concerning the security
to which is request relates.
- ----------------------------------------------------------------------------------------------------
Associate Signature: Date:
- ----------------------------------------------------------------------------------------------------
====================================================================================================
COMPLIANCE OFFICER USE ONLY
- ----------------------------------------------------------------------------------------------------
Approved: Disapproved: Authorized Signatory: Date:
- ----------------------------------------------------------------------------------------------------
Comments:
- ----------------------------------------------------------------------------------------------------
Note: This preclearance will lapse at the end of the day on __________________, 19__.
If you decide not to effect the trade, please notify me.
- ----------------------------------------------------------------------------------------------------
Date: By:
- ----------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
EXHIBIT D1
- ------------------------------
Return to: Manager, Corporate Compliance
Mellon Bank
P.O. Box 3130
Pittsburgh, PA 15230-3130
STATEMENT OF SECURITY HOLDINGS
As of
1. List of all securities in which you, your immediate family, any other
member of your immediate household, or any trust or estate of which you
or your spouse is a trustee or fiduciary or beneficiary, or of which your
minor child is a beneficiary, or any person for whom you direct or effect
transactions under a power of attorney or otherwise, maintain a
beneficial ownership - (see Glossary in Policy). If none, write NONE.
Securities issued or guaranteed by the U.S. government or its agencies or
instrumentalities, bankers' acceptances, bank certificates of deposit and
time deposits, commercial paper, repurchase agreements and shares of
registered investment companies need not be listed. IF YOUR LIST IS
EXTENSIVE, PLEASE ATTACH A COPY OF THE MOST RECENT STATEMENT FROM YOUR
BROKER(S), RATHER THAN LIST THEM ON THIS FORM.
-----------------------------------------------------------------------------
NAME OF SECURITY TYPE OF SECURITY AMOUNT OF SHARES
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
2. List the names and addresses of any broker/dealers holding accounts in
which you have a beneficial interest, including the name of your
registered representative (if applicable), the account registration and
the relevant account numbers. If none, write NONE.
-----------------------------------------------------------------------------
BROKER/ ADDRESS NAME OF ACCOUNT ACCOUNT
DEALER REGISTERED REGISTRATION NUMBER(S)
REPRESENTATIVE
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
I certify that the statements made by me on this form are true, complete and
correct to the best of my knowledge and belief, and are made in good faith. I
acknowledge I have read, understood and complied with the Confidential
Information and Securities Trading Policy.
-----------------------------------------------------------------------------
Date: Printed Name:
-----------------------------------------------------------------------------
Signature:
-----------------------------------------------------------------------------
<PAGE>
EXHIBIT D2
- ------------------------------
Return to: Compliance Officer at the Dreyfus Corporation
200 Park Avenue
Legal Department
New York, NY 10166
STATEMENT OF SECURITY HOLDINGS
As of
1. List of all securities in which you, your immediate family, any other
member of your immediate household, or any trust or estate of which you
or your spouse is a trustee or fiduciary or beneficiary, or of which your
minor child is a beneficiary, or any person for whom you direct or effect
transactions under a power of attorney or otherwise, maintain a
beneficial interest. If none, write NONE. Securities issued or guaranteed
by the U.S. government or its agencies or instrumentalities, bankers'
acceptances, bank certificates of deposit and time deposits, commercial
paper, repurchase agreements and shares of registered investment
companies need not be listed. IF YOUR LIST IS EXTENSIVE, PLEASE ATTACH A
COPY OF THE MOST RECENT STATEMENT FROM YOUR BROKER(S), RATHER THAN LIST
THEM ON THIS FORM.
-----------------------------------------------------------------------------
NAME OF SECURITY TYPE OF SECURITY AMOUNT OF SHARES
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
2. List the names and addresses of any broker/dealers holding accounts in
which you have a beneficial interest, including the name of your
registered representative (if applicable), the account registration and
the relevant account numbers. If none, write NONE.
-----------------------------------------------------------------------------
BROKER/ ADDRESS NAME OF ACCOUNT ACCOUNT
DEALER REGISTERED REGISTRATION NUMBER(S)
REPRESENTATIVE
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
-----------------------------------------------------------------------------
I certify that the statements made by me on this form are true, complete and
correct to the best of my knowledge and belief, and are made in good faith. I
acknowledge I have read, understood and complied with the Confidential
Information and Securities Trading Policy.
-----------------------------------------------------------------------------
Date: Printed Name:
-----------------------------------------------------------------------------
Signature:
-----------------------------------------------------------------------------
POWER OF ATTORNEY
The undersigned hereby constitute and appoint Mark N. Jacobs, Steven
F. Newman, Michael A. Rosenberg, John B. Hammalian, Jeff Prusnofsky, Robert
R. Mullery, Janette E. Farragher, and Mark Kornfeld, and each of them, with
full power to act without the other, his or her true and lawful
attorney-in-fact and agent, with full power of substitution and
resubstitution, for him or her, and in his or her name, place and stead, in
any and all capacities (until revoked in writing) to sign any and all
amendments to the Registration Statement of each Fund enumerated on Exhibit
A hereto (including post-effective amendments and amendments thereto), and
to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting
unto said attorneys-in-fact and agents, and each of them, full power and
authority to do and perform each and every act and thing ratifying and
confirming all that said attorneys-in-fact and agents or any of them, or
their or his or her substitute or substitutes, may lawfully do or cause to
be done by virtue hereof.
/s/ Clifford L. Alexander March 16, 2000
----------------------------------
Clifford L. Alexander
/s/ Peggy C. Davis March 16, 2000
----------------------------------
Peggy C. Davis
/s/ Joseph S. DiMartino March 16, 2000
----------------------------------
Joseph S. DiMartino
/s/ Ernest Kafka March 16, 2000
----------------------------------
Ernest Kafka
/s/ Nathan Leventhal March 16, 2000
----------------------------------
Nathan Leventhal
POWER OF ATTORNEY
The undersigned hereby each constitute and appoint Mark N. Jacobs, Steven
F. Newman, Michael A. Rosenberg, Jeff Prusnofsky, Robert R. Mullery, Janette
Farragher, Mark Kornfeld, and John B. Hammalian, and each of them, with full
power to act without the other, her true and lawful attorney-in-fact and agent,
with full power of substitution and resubstitution, for her, and in her name,
place and stead, in any and all capacities (until revoked in writing) to sign
any and all amendments to the Registration Statement of each Fund enumerated on
Exhibit A hereto (including post-effective amendments and amendments thereto),
and to file the same, with all exhibits thereto, and other documents in
connection therewith, with the Securities and Exchange Commission, granting unto
said attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing ratifying and confirming all that
said attorneys-in-fact and agents or any of them, or their or his or her
substitute or substitutes, may lawfully do or cause to be done by virtue hereof.
/s/ Stephen E. Canter March 22, 2000
Stephen E. Canter
President
/s/ Joseph W. Connolly March 22, 2000
Joseph W. Connolly
Vice President and Treasurer
<PAGE>
EXHIBIT A
1) Dreyfus A Bonds Plus, Inc.
2) Dreyfus Appreciation Fund, Inc.
3) Dreyfus Balanced Fund, Inc.
4) Dreyfus BASIC GNMA Fund
5) Dreyfus BASIC Money Market Fund, Inc.
6) Dreyfus BASIC Municipal Fund, Inc.
7) Dreyfus BASIC U.S. Government Money Market Fund
8) Dreyfus California Intermediate Municipal Bond Fund
9) Dreyfus California Tax Exempt Bond Fund, Inc.
10) Dreyfus California Tax Exempt Money Market Fund
11) Dreyfus Cash Management
12) Dreyfus Cash Management Plus, Inc.
13) Dreyfus Connecticut Intermediate Municipal Bond Fund
14) Dreyfus Connecticut Municipal Money Market Fund, Inc.
15) Dreyfus Florida Intermediate Municipal Bond Fund
16) Dreyfus Florida Municipal Money Market Fund
17) Dreyfus Founders Funds, Inc.
18) The Dreyfus Fund Incorporated
19) Dreyfus Global Bond Fund, Inc.
20) Dreyfus Global Growth Fund
21) Dreyfus GNMA Fund, Inc.
22) Dreyfus Government Cash Management Funds
23) Dreyfus Growth and Income Fund, Inc.
24) Dreyfus Growth and Value Funds, Inc.
25) Dreyfus Growth Opportunity Fund, Inc.
26) Dreyfus Debt and Equity Funds
27) Dreyfus Index Funds, Inc.
28) Dreyfus Institutional Money Market Fund
29) Dreyfus Institutional Preferred Money Market Fund
30) Dreyfus Institutional Short Term Treasury Fund
31) Dreyfus Insured Municipal Bond Fund, Inc.
32) Dreyfus Intermediate Municipal Bond Fund, Inc.
33) Dreyfus International Funds, Inc.
34) Dreyfus Investment Grade Bond Funds, Inc.
35) Dreyfus Investment Portfolios
36) The Dreyfus/Laurel Funds, Inc.
37) The Dreyfus/Laurel Funds Trust
38) The Dreyfus/Laurel Tax-Free Municipal Funds
39) Dreyfus LifeTime Portfolios, Inc.
40) Dreyfus Liquid Assets, Inc.
41) Dreyfus Massachusetts Intermediate Municipal Bond Fund
42) Dreyfus Massachusetts Municipal Money Market Fund
43) Dreyfus Massachusetts Tax Exempt Bond Fund
44) Dreyfus MidCap Index Fund
45) Dreyfus Money Market Instruments, Inc.
46) Dreyfus Municipal Bond Fund, Inc.
47) Dreyfus Municipal Cash Management Plus
48) Dreyfus Municipal Money Market Fund, Inc.
49) Dreyfus New Jersey Intermediate Municipal Bond Fund
50) Dreyfus New Jersey Municipal Bond Fund, Inc.
51) Dreyfus New Jersey Municipal Money Market Fund, Inc.
52) Dreyfus New Leaders Fund, Inc.
53) Dreyfus New York Municipal Cash Management
54) Dreyfus New York Tax Exempt Bond Fund, Inc.
55) Dreyfus New York Tax Exempt Intermediate Bond Fund
56) Dreyfus New York Tax Exempt Money Market Fund
57) Dreyfus U.S. Treasury Intermediate Term Fund
58) Dreyfus U.S. Treasury Long Term Fund
59) Dreyfus 100% U.S. Treasury Money Market Fund
60) Dreyfus U.S. Treasury Short Term Fund
61) Dreyfus Pennsylvania Intermediate Municipal Bond Fund
62) Dreyfus Pennsylvania Municipal Money Market Fund
63) Dreyfus Premier California Municipal Bond Fund
64) Dreyfus Premier Equity Funds, Inc.
65) Dreyfus Premier International Funds, Inc.
66) Dreyfus Premier GNMA Fund
67) Dreyfus Premier Worldwide Growth Fund, Inc.
68) Dreyfus Premier Municipal Bond Fund
69) Dreyfus Premier New York Municipal Bond Fund
70) Dreyfus Premier State Municipal Bond Fund
71) Dreyfus Premier Value Equity Funds
72) Dreyfus Short-Intermediate Government Fund
73) Dreyfus Short-Intermediate Municipal Bond Fund
74) The Dreyfus Socially Responsible Growth Fund, Inc.
75) Dreyfus Stock Index Fund
76) Dreyfus Tax Exempt Cash Management
77) The Dreyfus Premier Third Century Fund, Inc.
78) Dreyfus Treasury Cash Management
79) Dreyfus Treasury Prime Cash Management
80) Dreyfus Variable Investment Fund
81) Dreyfus Worldwide Dollar Money Market Fund, Inc.
82) General California Municipal Bond Fund, Inc.
83) General California Municipal Money Market Fund
84) General Government Securities Money Market Funds, Inc.
85) General Money Market Fund, Inc.
86) General Municipal Bond Fund, Inc.
87) General Municipal Money Market Funds, Inc.
88) General New York Municipal Bond Fund, Inc.
89) General New York Municipal Money Market Fund
DREYFUS PREMIER CALIFORNIA MUNICIPAL BOND FUND
Certificate of Assistant Secretary
The undersigned, Janette E. Farragher, Assistant Secretary of Dreyfus
Premier California Municipal Bond Fund (the "Fund"), hereby certifies that set
forth below is a true and correct copy of a resolution adopted by the Fund's
Board on March 16, 2000, on behalf of each Board member:
RESOLVED, that the Registration Statement and any and
all amendments and supplements thereto may be signed
by any one of Mark N. Jacobs, Steven F. Newman,
Michael A. Rosenberg, John B. Hammalian, Jeff
Prusnofsky, Robert R. Mullery, Janette E. Farragher,
and Mark Kornfeld, as the attorney-in-fact for the
proper officers of the Fund, with full power of
substitution and resubstitution; and that the
appointment of each of such persons as such
attorney-in-fact hereby is authorized and approved;
and that such attorneys-in-fact, and each of them,
shall have full power and authority to do and perform
each and every act and thing requisite and necessary
to be done in connection with such Registration
Statements and any and all amendments and supplements
thereto, as fully to all intents and purposes as the
officer, for whom he or she is acting as
attorney-in-fact, might or could do in person.
IN WITNESS WHEREOF, I have hereunto signed my name and affixed the seal of
the Fund on March 22, 2000.
/s/ Janette Farragher
--------------------------
Janette Farragher
Assistant Secretary
