File No. 33-19655
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. 10 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 10 [X]
(Check appropriate box or boxes.)
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
(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)
X on May 1, 1996 pursuant to paragraph (b)
60 days after filing pursuant to paragraph (a)(i)
on (date) pursuant to paragraph (a)(i)
75 days after filing pursuant to paragraph (a)(ii)
on (date) pursuant to paragraph (a)(ii) of Rule 485
If appropriate, check the following box:
this post-effective amendment designates a new effective date for
a previously filed post-effective amendment.
----
Registrant has registered an indefinite number of shares of its common
stock under the Securities Act of 1933 pursuant to Section 24(f) of the
Investment Company Act of 1940. Registrant's Rule 24f-2 Notice for the
fiscal year ended December 31, 1995 was filed on February 28, 1996.
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
Cross-Reference Sheet Pursuant to Rule 495(a)
Items in
Part A of
Form N-1A Caption Page
_________ _______ ____
1 Cover Page Cover
2 Synopsis 3
3 Condensed Financial Information 4
4 General Description of Registrant 4
5 Management of the Fund 8
5(a) Management's Discussion of Fund's Performance *
6 Capital Stock and Other Securities 20
7 Purchase of Securities Being Offered 9
8 Redemption or Repurchase 14
9 Pending Legal Proceedings *
Items in
Part B of
Form N-1A
- ---------
10 Cover Page Cover
11 Table of Contents Cover
12 General Information and History B-25
13 Investment Objectives and Policies B-2
14 Management of the Fund B-10
15 Control Persons and Principal B-14
Holders of Securities
16 Investment Advisory and Other B-14
Services
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
Cross-Reference Sheet Pursuant to Rule 495(a) (continued)
Items in
Part B of
Form N-1A Caption Page
_________ _______ _____
17 Brokerage Allocation B-23
18 Capital Stock and Other Securities B-25
19 Purchase, Redemption and Pricing B-16, B-18,
of Securities Being Offered B-22
20 Tax Status *
21 Underwriters B-16
22 Calculations of Performance Data B-24
23 Financial Statements B-39
Items in
Part C of
Form N-1A
_________
24 Financial Statements and Exhibits C-1
25 Persons Controlled by or Under C-3
Common Control with Registrant
26 Number of Holders of Securities C-3
27 Indemnification C-3
28 Business and Other Connections of C-4
Investment Adviser
29 Principal Underwriters C-11
30 Location of Accounts and Records C-14
31 Management Services C-14
32 Undertakings C-14
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
FOR USE BY BANKS ONLY
May 1, 1996
DREYFUS NEW JERSEY MUNICIPAL BOND
FUND, INC.
SUPPLEMENT TO PROSPECTUS DATED MAY 1, 1996
All mutual fund shares involve certain investment risks, including
the possible loss of principal.
750s050196BNK
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PROSPECTUS MAY 1, 1996
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
- ------------------------------------------------------------------------------
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC. (THE "FUND") IS AN
OPEN-END, NON-DIVERSIFIED, MANAGEMENT INVESTMENT COMPANY, KNOWN AS A
MUNICIPAL BOND FUND. THE FUND'S INVESTMENT OBJECTIVE IS TO PROVIDE YOU WITH
AS HIGH A LEVEL OF CURRENT INCOME EXEMPT FROM FEDERAL AND NEW JERSEY INCOME
TAXES AS IS CONSISTENT WITH THE PRESERVATION OF CAPITAL.
YOU CAN INVEST, REINVEST OR REDEEM SHARES AT ANY TIME WITHOUT CHARGE
OR PENALTY IMPOSED BY THE FUND.
THE FUND PROVIDES FREE REDEMPTION CHECKS, WHICH YOU CAN USE IN
AMOUNTS OF $500 OR MORE FOR CASH OR TO PAY BILLS. YOU CONTINUE TO EARN INCOME
ON THE AMOUNT OF THE CHECK UNTIL IT CLEARS. YOU CAN PURCHASE OR REDEEM SHARES
BY TELEPHONE USING DREYFUS TELETRANSFER.
THE DREYFUS CORPORATION PROFESSIONALLY MANAGES THE FUND'S PORTFOLIO.
THIS PROSPECTUS SETS FORTH CONCISELY INFORMATION ABOUT THE FUND THAT
YOU SHOULD KNOW BEFORE INVESTING. IT SHOULD BE READ AND RETAINED FOR FUTURE
REFERENCE.
THE STATEMENT OF ADDITIONAL INFORMATION, DATED MAY 1, 1996, WHICH MAY
BE REVISED FROM TIME TO TIME, PROVIDES A FURTHER DISCUSSION OF CERTAIN AREAS
IN THIS PROSPECTUS AND OTHER MATTERS WHICH MAY BE OF INTEREST TO SOME
INVESTORS. IT HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION AND
IS INCORPORATED HEREIN BY REFERENCE. FOR A FREE COPY, WRITE TO THE FUND AT
144 GLENN CURTISS BOULEVARD, UNIONDALE, NEW YORK 11556-0144, OR CALL
1-800-645-6561. WHEN TELEPHONING, ASK FOR OPERATOR 144.
MUTUAL FUND SHARES ARE NOT DEPOSITS OR OBLIGATIONS OF, OR GUARANTEED
OR ENDORSED BY, ANY BANK, AND ARE NOT FEDERALLY INSURED BY THE FEDERAL
DEPOSIT INSURANCE CORPORATION, THE FEDERAL RESERVE BOARD, OR ANY OTHER
AGENCY. THE NET ASSET VALUE OF FUNDS OF THIS TYPE FLUCTUATE FROM TIME TO
TIME.
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TABLE OF CONTENTS
Annual Fund Operating Expenses.................... 3
Condensed Financial Information................... 4
Description of the Fund........................... 4
Management of the Fund............................ 8
How to Buy Shares................................. 9
Shareholder Services.............................. 11
How to Redeem Shares.............................. 14
Service Plan...................................... 16
Dividends, Distributions and Taxes................ 17
Performance Information........................... 19
General Information............................... 20
Appendix.......................................... 21
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY
IS A CRIMINAL OFFENSE.
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This Page Intentionally Left Blank
Page 2
<TABLE>
<CAPTION>
ANNUAL FUND OPERATING EXPENSES
(as a percentage of average daily net assets)
<S> <C> <C> <C> <C>
Management Fees (after fee waiver).................................................... .45%
12b-1 Fees (distribution and servicing)............................................... .25%
Other Expenses........................................................................ .10%
Total Fund Operating Expenses (after fee waiver)...................................... .80%
EXAMPLE: 1 YEAR 3 YEARS 5 YEARS 10 YEARS
You would pay the following expenses on
a $1,000 investment, assuming (1) 5%
annual return and (2) redemption at the
end of each time period: $8 $26 $44 $99
</TABLE>
- ------------------------------------------------------------------------------
THE AMOUNTS LISTED IN THE EXAMPLE SHOULD NOT BE CONSIDERED AS
REPRESENTATIVE OF PAST OR FUTURE EXPENSES AND ACTUAL EXPENSES MAY BE GREATER
OR LESS THAN THOSE INDICATED. MOREOVER, WHILE THE EXAMPLE ASSUMES A 5% ANNUAL
RETURN, THE FUND'S ACTUAL PERFORMANCE WILL VARY AND MAY RESULT IN AN ACTUAL
RETURN GREATER OR LESS THAN 5%.
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The purpose of the foregoing table is to assist you in understanding
the costs and expenses borne by the Fund, the payment of which will reduce
investors' annual return. Long-term investors could pay more in 12b-1 fees
than the economic equivalent of paying a front end sales charge. Total Fund
Operating Expenses noted above have been restated to reflect an undertaking
by TheDreyfus Corporation that if, in the fiscal year ending December 31,
1996, Fund expenses, including the management fee, exceed .80% of the value
of the Fund's average net assets for the fiscal year, The Dreyfus Corporation
may waive its management fee or bear certain other expenses to the extent of
such excess expense. The expenses noted above, without reimbursement, would
have been: Management Fees -- .60% and Total Fund Operating Expenses -- .95%.
Certain Service Agents (as defined below) may charge their clients direct
fees for effecting transactions in Fund shares; such fees are not reflected
in the foregoing table. See "Management of the Fund" and "Service Plan."
Page 3
CONDENSED FINANCIAL INFORMATION
The information in the following table has been audited by Ernst &
Young LLP, the Fund's independent auditors, whose report thereon appears in
the Statement of Additional Information. Further financial data and related
notes are included in the Statement of Additional Information, available upon
request.
<TABLE>
<CAPTION>
FINANCIAL HIGHLIGHTS
Contained below is per share operating performance data for a share
of Common Stock outstanding, total investment return, ratios to average net
assets and other supplemental data for each year indicated. This information
has been derived from the Fund's financial statements.
YEAR ENDED DECEMBER 31,
-----------------------------------------------------------------------------------
PER SHARE DATA: 1987(1) 1988 1989 1990 1991 1992 1993 1994 1995
------- ------ ------ ------ ----- ------ ----- ----- -----
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
Net asset value, beginning of year.... $11.50 $11.62 $12.16 $12.36 $12.47 $13.06 $13.17 $14.03 $12.41
------ ------ ------ ------ ------ ------ ----- ------ -----
INVESTMENT OPERATIONS:
Investment income-net...... .14 .88 .83 .83 .81 .80 .79 .78 .74
Net realized and unrealized
gain (loss) on investments .12 .54 .24 .11 .63 .31 .88 (1.61) 1.12
------ ------ ------ ------ ------ ------ ----- ------ -----
TOTAL FROM INVESTMENT OPERATIONS... .26 1.42 1.07 .94 1.44 1.11 1.67 (.83) 1.86
------ ------ ------ ------ ------ ------ ----- ------ -----
DISTRIBUTIONS:
Dividends from investment income-net... (.14) (.88) (.83) (.83) (.81) (.80) (.79) (.77) (.74)
Dividends from net realized
gain on investments...... -- -- (.04) -- (.04) (.20) (.02) -- --
Dividends in excess of net realized
gain on investments...... -- -- -- -- -- -- -- (.02) --
------ ------ ------ ------ ------ ------ ----- ------ -----
TOTAL DISTRIBUTIONS...... (.14) (.88) (.87) (.83) (.85) (1.00) (.81) (.79) (.74)
------ ------ ------ ------ ------ ------ ----- ------ -----
Net asset value, end of year $11.62 $12.16 $12.36 $12.47 $13.06 $13.17 $14.03 $12.41 $13.53
====== ======= ====== ====== ===== ====== ====== ====== ======
TOTAL INVESTMENT RETURN........ 14.73%(2) 12.59% 9.11% 7.94% 11.95% 8.77% 12.97% (6.02%) 15.29%
RATIOS/SUPPLEMENTAL DATA:
Ratio of operating expenses to
average net assets....... -- .39% .82% .77% .75% .73% .72% .77% .80%
Ratio of net investment income
to average net assets.... 8.02%(2) 7.36% 6.77% 6.74% 6.36% 6.06% 5.74% 5.94% 5.67%
Decrease reflected in above expense ratios
due to undertakings by
The Dreyfus Corporation (limited to the
expense limitation provision of
the management agreement)..... 1.50%(2) .91% .25% .25% .25% .25% .25% .20% .15%
Portfolio Turnover Rate.... -- 60.77% 34.96% 25.02% 22.53% 33.58% 6.05% 10.02% 24.37%
Net Assets, end of year
(000's omitted)..... $37,743 $174,788 $256,902 $350,416 $515,706 $614,529 $725,815 $577,525 $653,836
- -----------
(1) From November 6, 1987 (commencement of operations) to December 31, 1987.
(2) Annualized.
</TABLE>
Further information about the Fund's performance is contained in the
Fund's annual report, which may be obtained without charge by writing to the
address or calling the number set forth on the cover page of this Prospectus.
DESCRIPTION OF THE FUND
INVESTMENT OBJECTIVE
The Fund's investment objective is to provide you with as high a
level of current income exempt from Federal and New Jersey income taxes as is
consistent with the preservation of capital. To accomplish its investment
objective, the Fund invests primarily in the debt securities of the State of
New Jersey, its political subdivisions, authorities and corporations, and
certain other specified securities, the
Page 4
interest from which is, in the opinion of bond counsel to the issuer, exempt
from Federal and New Jersey income taxes (collectively, "New Jersey Municipal
Obligations"). To the extent acceptable New Jersey Municipal Obligations are
at any time unavailable for investment by the Fund, the Fund may invest
temporarily in other debt securities the interest from which is, in the
opinion of bond counsel to the issuer, exempt from Federal, but not New
Jersey, income tax. The dollar-weighted average maturity of the Fund's
portfolio is expected to exceed ten years. The Fund's investment objective
cannot be changed without approval by the holders of a majority (as defined
in the Investment Company Act of 1940, as amended (the "1940 Act")) of the
Fund's outstanding voting shares. There can be no assurance that the Fund's
investment objective will be achieved.
MUNICIPAL OBLIGATIONS
Debt securities 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 generally
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.
MANAGEMENT POLICIES
It is a fundamental policy of the Fund that it will invest at least
80% of the value of its net assets (except when maintaining a temporary
defensive position) in Municipal Obligations. At least 65% of the value of
the Fund's net assets (except when maintaining a temporary defensive
position) will be invested in bonds, debentures and other debt instruments.
Generally, at least 65% of the value of the Fund's net assets will be
invested in New Jersey Municipal Obligations and the remainder may be
invested in securities that are not New Jersey Municipal Obligations and
therefore may be subject to New Jersey income tax. See "Investment
Considerations and Risks _ Investing in New Jersey Municipal Obligations"
below, and "Dividends, Distributions and Taxes."
At least 80% of the value of the Fund's net assets must consist of
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, a division of The McGraw-Hill Companies, Inc. ("S&P"),
or Fitch Investors Service, L.P. ("Fitch"). The Fund may invest up to 20% 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 rating assigned by Moody's, S&P or Fitch. The Fund may
invest in short-term Municipal Obligations which are rated in the two highest
rating categories by Moody's, S&P or Fitch. See "Appendix B" in the Statement
of Additional Information. Municipal Obligations rated BBB by S&P or Fitch or
Baa by Moody's are considered investment grade obligations;
Page 5
those rated BBB by S&P and Fitch are regarded as having an adequate capacity
to pay principal and interest, while those rated Baa by Moody's are
considered medium grade obligations which lack outstanding investment
characteristics and have speculative characteristics. Investments rated Ba
or lower by Moody's and BB or lower by S&P and Fitch normally provide higher
yields but involve greater risk because of their speculative characteristics.
The Fund may invest in Municipal Obligations rated C by Moody's or D by S&P
or Fitch, which is the lowest rating assigned by such rating organizations
and indicates that the Municipal Obligation is in default and interest and/or
repayment of principal is in arrears. See "Investment Considerations and
Risks _ Lower Rated Bonds" below for a further discussion of certain risks.
The Fund also may invest in securities which, while not rated, are determined
by The Dreyfus Corporation to be of comparable quality to the rated securities
in which the Fund may invest; for purposes of the 80% requirement described
above, such unrated securities shall be deemed to have the rating so
determined. The Fund also may invest in Taxable Investments of the quality
described under "Appendix -- Certain Portfolio Securities -- Taxable
Investments."
From time to time, the Fund may invest more than 25% of the value of
its total assets in industrial development bonds which, although issued by
industrial development authorities, may be backed only by the assets and
revenues of the non-governmental users. Interest on Municipal Obligations
(including certain industrial development bonds) which are specified private
activity bonds, as defined in the Internal Revenue Code of 1986, as amended
(the "Code"), issued after August 7, 1986, while exempt from Federal income
tax, is a preference item for the purpose of the alternative minimum tax.
Where a regulated investment company receives such interest, a proportionate
share of any exempt-interest dividend paid by the investment company may be
treated as such a preference item to shareholders. The Fund may invest
without limitation in such Municipal Obligations if The Dreyfus Corporation
determines that their purchase is consistent with the Fund's investment
objective. See "Investment Considerations and Risks" below.
The annual portfolio turnover rate for the Fund is not expected to
exceed 100%. The Fund may engage in various investment techniques, such as
options transactions and lending portfolio securities. Use of certain of
these techniques may give rise to taxable income. See also "Investment
Considerations and Risks," "Appendix--Investment Techniques" and "Dividends,
Distributions and Taxes" below and "Investment Objective and Management
Policies--Management Policies" in the Statement of Additional Information.
INVESTMENT CONSIDERATIONS AND RISKS
GENERAL -- Even though interest-bearing securities are investments which
promise a stable stream of income, the prices of such securities are
inversely affected by changes in interest rates and, therefore, are subject
to the risk of market price fluctuations. Certain securities that may be
purchased by the Fund, such as those with interest rates that fluctuate
directly or indirectly based on multiples of a stated index, are designed to
be highly sensitive to changes in interest rates and can subject the holders
thereof to extreme reductions of yield and possibly loss of principal. The
values of fixed-income securities also may be affected by changes in the
credit rating or financial condition of the issuing entities. Once the rating
of a portfolio security has been changed, the Fund will consider all
circumstances deemed relevant in determining whether to continue to hold the
security. The Fund's net asset value generally will not be stable and should
fluctuate based upon changes in the value of the Fund's portfolio securities.
Securities in which the Fund will invest may earn a higher level of current
income than certain shorter-term or higher quality securities which generally
have greater liquidity, less market risk and less fluctuation in market
value.
INVESTING IN NEW JERSEY MUNICIPAL OBLIGATIONS -- You should consider
carefully the special risks inherent in the Fund's investment in New Jersey
Municipal Obligations. If there should be a default or other financial crisis
relating to the State of New Jersey or an agency or municipality thereof, the
market
Page 6
value and marketability of outstanding New Jersey Municipal Obligations in
the Fund's portfolio and interest income to the Fund could be adversely
affected. Although New Jersey enjoyed a period of economic growth
with unemployment levels below the national average during the mid-1980s, its
economy slowed down well before the onset of the national recession, which,
according to the National Bureau of Economic Research, began in July 1990.
Reflecting the economic downturn, the State's unemployment rate rose from a
low of 3.6% in the first quarter of 1989 to a recessionary peak of 9.3%
during 1992. Since then, the State's unemployment rate fell to 6.4% during
the first ten months of 1995. As a result of New Jersey's fiscal weakness, in
July 1991, S&P lowered its rating of the State's general obligation debt from
AAA to AA+. You should obtain and review a copy of the Statement of
Additional Information which more fully sets forth these and other risk
factors.
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 Dreyfus Corporation 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 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.
ZERO COUPON SECURITIES -- 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.
LOWER RATED BONDS _ The Fund may invest up to 20% of the value of its net
assets in higher yielding (and, therefore, higher risk) debt securities such
as those rated Ba by Moody's or BB by S&P or Fitch or as low as the lowest
rating assigned by Moody's, S&P or Fitch (commonly known as junk bonds). They
generally are not meant for short-term investing and may be subject to
certain risks with respect to the issuing entity and to greater market
fluctuations than certain lower yielding, higher rated fixed-income
securities. The retail secondary market for these bonds may be less liquid
than that of higher rated bonds; adverse conditions could make it difficult
at times for the Fund to sell certain securities or could
Page 7
result in lower prices than those used in calculating the Fund's net asset
value. See "Appendix _ Certain Portfolio Securities _ Ratings."
USE OF DERIVATIVES -- The Fund may invest in derivatives ("Derivatives").
These are financial instruments which derive their performance, at least in
part, from the performance of an underlying asset, index or interest rate.
The Derivatives the Fund may use include options. While Derivatives can be
used effectively in furtherance of the Fund's investment objective, under
certain market conditions, they can increase the volatility of the Fund's net
asset value, can decrease the liquidity of the Fund's portfolio and make more
difficult the accurate pricing of the Fund's portfolio. See "Appendix --
Investment Techniques -- Use of Derivatives" below and "Investment Objective
and Management Policies -- Management Policies -- Derivatives"in the
Statement of Additional Information.
NON-DIVERSIFIED STATUS -- The classification of the Fund as a
"non-diversified" investment company means that the proportion of the Fund's
assets that may be invested in the securities of a single issuer is not
limited by the 1940 Act. A "diversified" investment company is required by
the 1940 Act generally, with respect to 75% of its total assets, to invest
not more than 5% of such assets in the securities of a single issuer. Since a
relatively high percentage of the Fund's assets may be invested in the
obligations of a limited number of issuers, the Fund's portfolio securities
may be more sensitive to changes in the market value of a single issuer.
However, to meet Federal tax requirements, at the close of each quarter the
Fund may not have more than 25% of its total assets invested in any one
issuer and, with respect to 50% of total assets, not more than 5% of its
total assets invested in any one issuer. These limitations do not apply to
U.S. Government securities.
SIMULTANEOUS INVESTMENTS -- Investment decisions for the Fund are made
independently from those of other investment companies advised by The Dreyfus
Corporation. If, however, such other investment companies desire to invest
in, or dispose of, the same securities as 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.
MANAGEMENT OF THE FUND
INVESTMENT ADVISER -- The Dreyfus Corporation, located at 200 Park Avenue,
New York, New York 10166, was formed in 1947 and serves as the Fund's
investment adviser. The Dreyfus Corporation is a wholly-owned subsidiary of
Mellon Bank, N.A., which is a wholly-owned subsidiary of Mellon Bank
Corporation ("Mellon"). As of March 29, 1996, The Dreyfus Corporation managed
or administered approximately $82 billion in assets for more than 1.7 million
investor accounts nationwide.
The Dreyfus Corporation supervises and assists in the overall
management of the Fund's affairs under a Management Agreement with the Fund,
subject to the authority of the Fund's Board in accordance with Maryland law.
The Fund's primary portfolio manager is Samuel J. Weinstock. He has held that
position since August 31, 1988 and has been employed by The Dreyfus
Corporation since 1987. The Fund's other portfolio managers are identified in
the Statement of Additional Information. The Dreyfus Corporation also
provides research services for the Fund and for other funds advised by The
Dreyfus Corporation through a professional staff of portfolio managers and
securities analysts.
Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international
markets. Mellon is among the twenty-five largest bank holding companies in
the United States based on total assets. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCO Credit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries,
Page 8
including The Dreyfus Corporation, Mellon managed more than $233 billion in
assets as of December 31, 1995, including approximately $81 billion in
proprietary mutual fund assets. As of December 31, 1995, Mellon,
through various subsidiaries, provided non-investment services, such as
custodial and administration services, for more than $86 billion in assets,
including approximately $60 billion in mutual fund assets.
Under the terms of the Management Agreement, the Fund has agreed to
pay The Dreyfus Corporation a monthly fee at the annual rate of .60 of 1% of
the value of the Fund's average daily net assets. For the fiscal year ended
December 31, 1995, the Fund paid The Dreyfus Corporation a monthly management
fee at the effective annual rate of .45 of 1% of the value of the Fund's
average daily net assets pursuant to undertakings by The Dreyfus Corporation.
From time to time, The Dreyfus Corporation may waive receipt of its fees
and/or voluntarily assume certain expenses of the Fund, which would have the
effect of lowering the overall expense ratio of the Fund and increasing yield
to investors. The Fund will not pay The Dreyfus Corporation at a later time
for any amounts it may waive, nor will the Fund reimburse The Dreyfus
Corporation for any amounts it may assume.
In allocating brokerage transactions for the Fund, TheDreyfus
Corporation seeks to obtain the best execution of orders at the most
favorable net price. Subject to this determination, The Dreyfus Corporation
may consider, among other things, the receipt of research services and/or the
sale of shares of the Fund or other funds managed, advised or administered by
The Dreyfus Corporation as factors in the selection of broker-dealers to
execute portfolio transactions for the Fund. See "Portfolio Transactions" in
the Statement of Additional Information.
The Dreyfus Corporation may pay the Fund's distributor for
shareholder services from its own assets, including past profits but not
including the management fee paid by the Fund. The Fund's distributor may use
part or all of such payments to pay Service Agents in respect of these
services.
DISTRIBUTOR -- The Fund's distributor is Premier Mutual Fund Services, Inc.
(the "Distributor"), located at One Exchange Place, Boston, Massachusetts
02109. The Distributor's ultimate parent is Boston Institutional Group, Inc.
TRANSFER AND DIVIDEND DISBURSING AGENT AND CUSTODIAN -- Dreyfus Transfer,
Inc., a wholly-owned subsidiary of The Dreyfus Corporation, P.O. Box 9671,
Providence, Rhode Island 02940-9671, is the Fund's Transfer and Dividend
Disbursing Agent (the "Transfer Agent"). The Bank of New York, 90 Washington
Street, New York, New York 10286, is the Fund's Custodian.
HOW TO BUY SHARES
Fund shares are sold through the Distributor or certain financial
institutions (which may include banks), securities dealers ("Selected
Dealers"), and other industry professionals, such as investment advisers,
accountants and estate planning firms (collectively, "Service Agents") that
have entered into service agreements with the Distributor. Stock certificates
are issued only upon your written request. No certificates are issued for
fractional shares. It is not recommended that the Fund be used as a vehicle
for Keogh, IRA or other qualified plans. The Fund reserves the right to
reject any purchase order.
The minimum initial investment is $2,500, or $1,000 if you are a
client of a Service Agent which has made an aggregate minimum initial
purchase for its customers of $2,500. Subsequent investments must be at least
$100. The initial investment must be accompanied by the Account Application.
For full-time or part-time employees of The Dreyfus Corporation or any of its
affiliates or subsidiaries, directors of The Dreyfus Corporation, Board
members of a fund advised by The Dreyfus Corporation, including members of
the Fund's Board, or the spouse or minor child of any of the foregoing, the
minimum initial investment is $1,000. For full-time or part-time employees of
The Dreyfus Corporation or any of its affiliates or subsidiaries who elect to
have a portion of their pay directly deposited into their Fund account, the
minimum initial investment is $50. The Fund reserves the right to vary
further the
Page 9
initial and subsequent investment minimum requirements at any
time. Fund shares also are offered without regard to the minimum initial
investment requirements through Dreyfus-AUTOMATIC Asset BuilderRegistration
Mark, Dreyfus Government Direct Deposit Privilege or Dreyfus Payroll Savings
Plan pursuant to the Dreyfus Step Program described under "Shareholders
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.
You may purchase Fund shares by check or wire, or through the Dreyfus
TELETRANSFER Privilege described below. Checks should be made payable to "The
Dreyfus Family of Funds." Payments to open new accounts which are mailed
should be sent to The Dreyfus Family of Funds, P.O. Box 9387, Providence,
Rhode Island 02940-9387, together with your Account Application. For
subsequent investments, your Fund account number should appear on the check
and an investment slip should be enclosed and sent to The Dreyfus Family of
Funds, P.O. Box 105, Newark, New Jersey 07101-0105. Neither initial nor
subsequent investments should be made by third party check. Purchase orders
may be delivered in person only to a Dreyfus Financial Center. THESE ORDERS
WILL BE FORWARDED TO THE FUND AND WILL BE PROCESSED ONLY UPON RECEIPT
THEREBY. For the location of the nearest Dreyfus Financial Center, please
call one of the telephone numbers listed under "General Information."
Wire payments may be made if your bank account is in a commercial
bank that is a member of the Federal Reserve System or any other bank having
a correspondent bank in New York City. Immediately available funds may be
transmitted by wire to The Bank of New York, DDA#8900052295/Dreyfus New
Jersey Municipal Bond Fund, Inc., for purchase of Fund shares in your name.
The wire must include your Fund account number (for new accounts, your
Taxpayer Identification Number ("TIN") should be included instead), account
registration and dealer number, if applicable. If your initial purchase of
Fund shares is by wire, please call 1-800-645-6561 after completing your wire
payment to obtain your Fund account number. Please include your Fund account
number on the Account Application and promptly mail the Account Application
to the Fund, as no redemptions will be permitted until the Account
Application is received. You may obtain further information about remitting
funds in this manner from your bank. All payments should be made in U.S.
dollars and, to avoid fees and delays, should be drawn only on U.S. banks. A
charge will be imposed if any check used for investment in your account does
not clear. Other purchase procedures may be in effect for clients of certain
Service Agents. The Fund makes available to certain large institutions the
ability to issue purchase instructions through compatible computer
facilities.
Subsequent investments also may be made by electronic transfer of
funds from an account maintained in a bank or other domestic financial
institution that is an Automated Clearing House member. You must direct the
institution to transmit immediately available funds through the Automated
Clearing House to The Bank of New York with instructions to credit your Fund
account. The instructions must specify your Fund account registration and
your Fund account number PRECEDED BY THE DIGITS "1111."
Management understands that some Service Agents may impose certain
conditions on their clients which are different from those described in this
Prospectus, and, to the extent permitted by applicable regulatory
authorities, may charge their clients direct fees for Servicing (as defined
under "Service Plan"). These fees would be in addition to any amounts which
might be received under the Service Plan. You should consult your Service
Agent in this regard.
Fund shares are sold on a continuous basis at the net asset value per
share next determined after an order in proper form is received by the
Transfer Agent. 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. Net
asset value per share is computed by dividing the value of the Fund's net
assets (i.e., the value of its assets less liabilities) by the total number
Page 10
of shares outstanding. The Fund's investments are valued by an independent
pricing service approved by the Fund's Board and are valued at fair value as
determined by the pricing service. The pricing service's procedures are
reviewed under the general supervision of the Fund's Board. For further
information regarding the methods employed in valuing Fund investments, see
"Determination of Net Asset Value" in the Statement of Additional
Information.
Federal regulations require that you provide a certified TIN upon
opening or reopening an account. See "Dividends, Distributions and Taxes" and
the Account Application for further information concerning this requirement.
Failure to furnish a certified TIN to the Fund could subject you to a $50
penalty imposed by the Internal Revenue Service (the "IRS").
DREYFUS TELETRANSFER PRIVILEGE -- You may purchase shares (minimum $500,
maximum $150,000 per day) 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 member may be so
designated. The Fund may modify or terminate this Privilege at any time or
charge a service fee upon notice to shareholders. No such fee currently is
contemplated.
If you have selected the Dreyfus TELETRANSFER Privilege, you may
request a Dreyfus TELETRANSFER purchase of shares by telephoning
1-800-645-6561 or, if you are calling from overseas, call 516-794-5452.
SHAREHOLDER SERVICES
The services and privileges described under this heading may not be
available to clients of certain Service Agents and some Service Agents may
impose certain conditions on their clients which are different from those
described in this Prospectus. You should consult your Service Agent in this
regard.
FUND EXCHANGES -- You may purchase, in exchange for shares of the Fund,
shares of certain other funds managed or administered by The Dreyfus
Corporation, to the extent such shares are offered for sale in your state of
residence. These funds have different investment objectives which may be of
interest to you. If you desire to use this service, you should consult your
Service Agent or call 1-800-645-6561 to determine if it is available and
whether any conditions are imposed on its use.
To request an exchange, you or your Service Agent acting on your
behalf must give exchange instructions to the Transfer Agent in writing or by
telephone. Before any exchange, you must obtain and should review a copy of
the current prospectus of the fund into which the exchange is being made.
Prospectuses may be obtained by calling 1-800-645-6561. Except in the case of
personal retirement plans, the shares being exchanged must have a current
value of at least $500; furthermore, when establishing a new account by
exchange, the shares being exchanged must have a value of at least the
minimum initial investment required for the fund into which the exchange is
being made. The ability to issue exchange instructions by telephone is given
to all Fund shareholders automatically, unless you check the applicable "No"
box on the Account Application, indicating that you specifically refuse this
Privilege. The Telephone Exchange Privilege may be established for an
existing account by written request, signed by all shareholders on the
account, or by a separate signed Shareholder Services Form, also available by
calling 1-800-645-6561. If you have established the Telephone Exchange
Privilege, you may telephone exchange instructions by calling 1-800-645-6561
or, if you are calling from overseas, call 516-794-5452. See "How to Redeem
Shares _ Procedures." Upon an exchange into a new account, the following
shareholder services and privileges, as applicable and where available, will
be automatically carried over to the fund into which the exchange is made:
Telephone Exchange Privilege, Check Redemption Privilege, Wire Redemption
Privilege, Telephone Redemption Privilege, Dreyfus TELETRANSFER Privilege and
the dividend/capital gain distribution option (except for Dreyfus Dividend
Sweep) selected by the investor.
Page 11
Shares will be exchanged at the next determined net asset value;
however, a sales load may be charged with respect to exchanges into funds
sold with a sales load. If you are exchanging into a fund that charges a
sales load, you may qualify for share prices which do not include the sales
load or which reflect a reduced sales load, if the shares you are exchanging
were: (a) purchased with a sales load, (b) acquired by a previous exchange
from shares purchased with a sales load, or (c) acquired through reinvestment
of dividends or distributions paid with respect to the foregoing categories
of shares. To qualify, at the time of the exchange you must notify the
Transfer Agent or your Service Agent must notify the Distributor. Any such
qualification is subject to confirmation of your holdings through a check of
appropriate records. See "Shareholder Services" in the Statement of
Additional Information. No fees currently are charged shareholders directly
in connection with exchanges, although the Fund reserves the right, upon not
less than 60 days' written notice, to charge shareholders a nominal fee in
accordance with rules promulgated by the Securities and Exchange Commission.
The Fund reserves the right to reject any exchange request in whole or in
part. The availability of Fund Exchanges may be modified or terminated at
any time upon notice to shareholders. See "Dividends, Distributions and
Taxes."
DREYFUS AUTO-EXCHANGE PRIVILEGE -- Dreyfus Auto-Exchange Privilege enables
you to invest regularly (on a semi-monthly, monthly, quarterly or annual
basis), in exchange for shares of the Fund, in shares of other funds in the
Dreyfus Family of Funds of which you are a shareholder. The amount you
designate, which can be expressed either in terms of a specific dollar or
share amount ($100 minimum), will be exchanged automatically on the first
and/or fifteenth day of the month according to the schedule you have
selected. Shares will be exchanged at the then-current net asset value;
however, a sales load may be charged with respect to exchanges into funds
sold with a sales load. See "Shareholder Services" in the Statement of
Additional Information. The right to exercise this Privilege may be modified
or canceled by the Fund or the Transfer Agent. You may modify or cancel your
exercise of this Privilege at any time by mailing written notification to The
Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671.
The Fund may charge a service fee for the use of this Privilege. No such fee
currently is contemplated. For more information concerning this Privilege and
the funds in the Dreyfus Family of Funds eligible to participate in this
Privilege, or to obtain a Dreyfus Auto-Exchange Authorization Form, please
call toll free 1-800-645-6561. See "Dividends, Distributions and Taxes."
DREYFUS-AUTOMATIC ASSET BUILDERRegistration Mark -- Dreyfus-AUTOMATIC Asset
Builder permits you to purchase Fund shares (minimum of $100 and maximum of
$150,000 per transaction) at regular intervals selected by you. Fund shares
are purchased by transferring funds from the bank account designated by you.
At your option, the account designated by you will be debited in the
specified amount, and Fund shares will be purchased, once a month, on either
the first or fifteenth day, or twice a month, on both days. Only an account
maintained at a domestic financial institution which is an Automated Clearing
House member may be so designated. To establish a Dreyfus-AUTOMATIC Asset
Builder account, you must file an authorization form with the Transfer Agent.
You may obtain the necessary authorization form by calling 1-800-645-6561.
You may cancel your participation in this Privilege or change the amount of
purchase at any time by mailing written notification to The Dreyfus Family of
Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671, and the
notification will be effective three business days following receipt. The
Fund may modify or terminate this Privilege at any time or charge a service
fee. No such fee currently is contemplated.
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 Federal
government automatically deposited into your Fund account. You may deposit as
much of such payments as you elect. To enroll in Dreyfus Government Direct
Deposit, you must file with the Transfer Agent a completed Direct Deposit
Sign-Up Form for each type of payment that you desire to include in
Page 12
this Privilege. The appropriate form may be obtained by calling
1-800-645-6561. Death or legal incapacity will terminate your participation
in this Privilege. You may elect at any time to terminate your participation
by notifying in writing the appropriate Federal agency. Further, the Fund may
terminate your participation upon 30 days' notice to you.
DREYFUS PAYROLL SAVINGS PLAN -- Dreyfus Payroll Savings Plan permits you to
purchase Fund shares (minimum of $100 per transaction) automatically on a
regular basis. Depending upon your employer's direct deposit program, you may
have part or all of your paycheck transferred to your existing Dreyfus
account electronically through the Automated Clearing House system at each
pay period. To establish a Dreyfus Payroll Savings Plan account, you must
file an authorization form with your employer's payroll department. Your
employer must complete the reverse side of the form and return it to The
Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671.
You may obtain the necessary authorization form by calling 1-800-645-6561.
You may change the amount of purchase or cancel the authorization only by
written notification to your employer. It is the sole responsibility of your
employer, not the Distributor, The Dreyfus Corporation, the Fund, the
Transfer Agent or any other person, to arrange for transactions under the
Dreyfus Payroll Savings Plan. The Fund may modify or terminate this Privilege
at any time or charge a service fee. No such fee currently is contemplated.
DREYFUS STEP PROGRAM -- Dreyfus Step Program enables you to purchase Fund
shares without regard to the Fund's minimum initial investment requirements
through Dreyfus-AUTOMATIC Asset Builder, Dreyfus Government Direct Deposit
Privilege or Dreyfus Payroll Savings Plan. To establish a Dreyfus Step
Program account, you must supply the necessary information on the Account
Application and file the required authorization form(s) with the Transfer
Agent. For more information concerning this Program, or to request the
necessary authorization form(s), please call toll free 1-800-782-6620. You
may terminate your participation in this Program at any time by discontinuing
your participation in Dreyfus-AUTOMATIC Asset Builder, Dreyfus Government
Direct Deposit Privilege or Dreyfus Payroll Savings Plan, as the case may be,
as provided under the terms of such Privilege(s). The Fund may modify or
terminate this Program at any time.
DREYFUS DIVIDEND OPTIONS -- Dreyfus Dividend Sweep enables you to invest
automatically dividends or dividends and capital gain distributions, if any,
paid by the Fund in shares of another fund in the Dreyfus Family of Funds of
which you are a shareholder. Shares of the other fund will be purchased at
the then-current net asset value; however, a sales load may be charged with
respect to investments in shares of a fund sold with a sales load. If you are
investing in a fund that charges a sales load, you may qualify for share price
s which do not include the sales load or which reflect a reduced sales load.
If you are investing in a fund that charges a contingent deferred sales
charge, the shares purchased will be subject on redemption to the contingent
deferred sales charge, if any, applicable to the purchased shares. See
"Shareholder Services" in the Statement of Additional Information. Dreyfus
Dividend ACHpermits 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 financial institution which is an
Automated Clearing House member may be so designated. Banks may charge a fee
for this service.
For more information concerning these privileges or to request a
Dividend Options Form, please call toll free 1-800-645-6561. You may cancel
these privileges by mailing written notification to The Dreyfus Family of
Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. To select a new
fund after cancellation, you must submit a new Dividend Options Form.
Enrollment in or cancellation of these privileges is effective three business
days following receipt. These privileges are available only for existing
accounts and may not be used to open new accounts. Minimum subsequent
investments do not apply to Dreyfus Dividend Sweep. The Fund may modify or
terminate these privileges at any time or charge a service fee. No such fee
currently is contemplated.
Page 13
AUTOMATIC WITHDRAWAL PLAN -- The Automatic Withdrawal Plan permits you to
request withdrawal of a specified dollar amount (minimum of $50) on either a
monthly or quarterly basis if you have a $5,000 minimum account. An
application for the Automatic Withdrawal Plan can be obtained by calling
1-800-645-6561. The Automatic Withdrawal Plan may be ended at any time by
you, the Fund or the Transfer Agent. Shares for which certificates have been
issued may not be redeemed through the Automatic Withdrawal Plan.
HOW TO REDEEM SHARES
GENERAL
You may request redemption of your shares at any time. Redemption
requests should be transmitted to the Transfer Agent as described below. When
a request is received in proper form, the Fund will redeem the shares at the
next determined net asset value.
The Fund imposes no charges when shares are redeemed. Service Agents
may charge their clients a nominal fee for effecting redemptions of Fund
shares. Any certificates representing Fund shares being redeemed must be
submitted with the redemption request. The value of the shares redeemed may
be more or less than their original cost, depending upon the Fund's
then-current net asset value.
The Fund ordinarily will make payment for all shares redeemed within
seven days after receipt by the Transfer Agent of a redemption request in
proper form, except as provided by the rules of the Securities and Exchange
Commission. HOWEVER, IF YOU HAVE PURCHASED FUND SHARES BY CHECK, BY DREYFUS
TELETRANSFER PRIVILEGE OR THROUGH DREYFUS-AUTOMATIC ASSET BUILDER AND
SUBSEQUENTLY SUBMIT A WRITTEN REDEMPTION REQUEST TO THE TRANSFER AGENT, THE
REDEMPTION PROCEEDS WILL BE TRANSMITTED TO YOU PROMPTLY UPON BANK CLEARANCE
OF YOUR PURCHASE CHECK, DREYFUS TELETRANSFER PURCHASE OR DREYFUS-AUTOMATIC
ASSET BUILDER ORDER, WHICH MAY TAKE UP TO EIGHT BUSINESS DAYS OR MORE. IN
ADDITION, THE FUND WILL NOT HONOR REDEMPTION CHECKS UNDER THE CHECK
REDEMPTION PRIVILEGE, AND WILL REJECT REQUESTS TO REDEEM SHARES BY WIRE OR
TELEPHONE OR PURSUANT TO THE DREYFUS TELETRANSFER PRIVILEGE, FOR A PERIOD OF
EIGHT BUSINESS DAYS AFTER RECEIPT BY THE TRANSFER AGENT OF THE PURCHASE
CHECK, THE DREYFUS TELETRANSFER PURCHASE OR THE DREYFUS-AUTOMATIC ASSET
BUILDER ORDER AGAINST WHICH SUCH REDEMPTION IS REQUESTED. THESE PROCEDURES
WILL NOT APPLY IF YOUR SHARES WERE PURCHASED BY WIRE PAYMENT, OR IF YOU
OTHERWISE HAVE A SUFFICIENT COLLECTED BALANCE IN YOUR ACCOUNT TO COVER THE
REDEMPTION REQUEST. PRIOR TO THE TIME ANY REDEMPTION IS EFFECTIVE, DIVIDENDS
ON SUCH SHARES WILL ACCRUE AND BE PAYABLE, AND YOU WILL BE ENTITLED TO
EXERCISE ALL OTHER RIGHTS OF BENEFICIAL OWNERSHIP. Fund shares will not be
redeemed until the Transfer Agent has received your Account Application.
The Fund reserves the right to redeem your account at its option upon
not less than 45 days' written notice if your account's net asset value is
$500 or less and remains so during the notice period.
PROCEDURES
You may redeem Fund shares by using the regular redemption procedure
through the Transfer Agent, or, 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, through the Check
Redemption Privilege, the Wire Redemption Privilege, the Telephone Redemption
Privilege or the Dreyfus TeleTransfer Privilege. If you are a client of a
Selected Dealer, you may redeem shares through the Selected Dealer. If you
have given your Service Agent authority to instruct the Transfer Agent to
redeem shares and to credit the proceeds of such redemptions to a designated
account at your Service Agent, you may redeem shares only in this manner and
in accordance with the regular redemption procedure described below. If you
wish to use the other redemption methods described below, you must arrange
with your Service Agent for delivery of the required application(s) to the
Transfer Agent. Other redemption procedures may be in effect for clients of
certain Service Agents. The Fund makes available to certain large
institutions the ability
Page 14
to issue redemption instructions through compatible computer facilities. The
Fund reserves the right to refuse any request made by wire or telephone,
including requests made shortly after a change of address, and may limit the
amount involved or the number of such requests. The Fund may modify or
terminate any redemption privilege at any time or charge a service fee upon
notice to shareholders. No such fee currently is contemplated. Shares for
which certificates have been issued are not eligible for the Check Redemption,
Wire Redemption, Telephone Redemption or Dreyfus TELETRANSFER Privilege.
You may redeem shares by telephone if you have checked the
appropriate box on the Account Application or have filed a Shareholder
Services Form with the Transfer Agent. If you select a telephone redemption
privilege or telephone exchange privilege (which is granted automatically
unless you refuse it), you authorize the Transfer Agent to act on telephone
instructions 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. The Fund will require the Transfer Agent to employ
reasonable procedures, such as requiring a form of personal identification,
to confirm that instructions are genuine and, if it does not follow such
procedures, the Fund or the Transfer Agent may be liable for any losses due
to unauthorized or fraudulent instructions. Neither the Fund nor the Transfer
Agent will be liable for following telephone instructions reasonably believed
to be genuine.
During times of drastic economic or market conditions, you may
experience difficulty in contacting the Transfer Agent by telephone to
request a redemption or exchange of Fund shares. In such cases, you should
consider using the other redemption procedures described herein. Use of these
other redemption procedures may result in your redemption request being
processed at a later time than it would have been if telephone redemption had
been used. During the delay, the Fund's net asset value may fluctuate.
REGULAR REDEMPTION -- Under the regular redemption procedure, you may redeem
shares by written request mailed to The Dreyfus Family of Funds, P.O. Box
9671, Providence, Rhode Island 02940-9671. Redemption requests may be
delivered in person only to a Dreyfus Financial Center. THESE REQUESTS WILL
BE FORWARDED TO THE FUND AND WILL BE PROCESSED ONLY UPON RECEIPT THEREBY. For
the location of the nearest Dreyfus Financial Center, please call one of the
telephone numbers listed under "General Information." Redemption requests
must be signed by each shareholder, including each owner of a joint account,
and each signature must be guaranteed. The Transfer Agent has adopted
standards and procedures pursuant to which signature-guarantees in proper
form generally will be accepted from domestic banks, brokers, dealers, credit
unions, national securities exchanges, registered securities associations,
clearing agencies and savings associations, as well as from participants in
the New York Stock Exchange Medallion Signature Program, the Securities
Transfer Agents Medallion Program ("STAMP") and the Stock Exchanges Medallion
Program. If you have any questions with respect to signature-guarantees,
please call one of the telephone numbers listed under "General Information."
Redemption proceeds of at least $1,000 will be wired to any member
bank of the Federal Reserve System in accordance with a written
signature-guaranteed request.
CHECK REDEMPTION PRIVILEGE -- You may write Redemption Checks drawn on your
Fund account. Redemption Checks may be made payable to the order of any
person in the amount of $500 or more. Potential fluctuations in the net asset
value of Fund shares should be considered in determining the amount of the
check. Redemption Checks should not be used to close your account. Redemption
Checks are free, but the Transfer Agent will impose a fee for stopping
payment of a Redemption Check upon your request or if the Transfer Agent
cannot honor the Redemption Check due to insufficient funds or other valid
reason. You should date your Redemption Checks with the current date when you
write them. Please do not postdate your Redemption Checks. If you do, the
Transfer Agent will honor, upon presentment, even if presented before the
date of the check, all postdated Redemption Checks which are dated within six
months of presentment for payment, if they are otherwise in good order. This
Privilege will be terminated immediately, without notice, with respect to any
account which is, or becomes, subject
Page 15
to backup withholding on redemptions (See "Dividends, Distributions and
Taxes"). Any Redemption Check written on an account which has become subject
to backup withholding on redemptions will not be honored by the Transfer
Agent.
WIRE REDEMPTION PRIVILEGE -- You may request by wire or telephone that
redemption proceeds (minimum $1,000) be wired to your account at a bank which
is a member of the Federal Reserve System, or a correspondent bank if your
bank is not a member. You also may direct that redemption proceeds be paid by
check (maximum $150,000 per day)made out to the owners of record and mailed
to your address. Redemption proceeds of less than $1,000 will be paid
automatically by check. Holders of jointly registered Fund or bank accounts
may have redemption proceeds of not more than $250,000 wired within any
30-day period. You may telephone redemption requests by calling
1-800-645-6561 or, if you are calling from overseas, call 516-794-5452. The
Statement of Additional Information sets forth instructions for transmitting
redemption requests by wire.
TELEPHONE REDEMPTION PRIVILEGE -- You may request by telephone that
redemption proceeds (maximum $150,000 per day) be paid by check and mailed to
your address. You may telephone redemption instructions by calling
1-800-645-6561 or, if you are calling from overseas, call 516-794-5452.
DREYFUS TELETRANSFER PRIVILEGE -- You may request by telephone that
redemption proceeds (minimum $500 per day) be transferred between your Fund
account and your bank account. Only a bank account maintained in a domestic
financial institution which is an Automated Clearing House member may be
designated. Redemption proceeds will be on deposit in your account at an
Automated Clearing House member bank ordinarily two days after receipt of the
redemption request or, at your request, paid by check (maximum $150,000 per
day) and mailed to your address. Holders of jointly registered Fund or bank
accounts may redeem through the Dreyfus TELETRANSFER Privilege for transfer
to their bank account not more than $250,000 within any 30-day period.
If you have selected the Dreyfus TELETRANSFER Privilege, you may
request a Dreyfus TELETRANSFER redemption of shares by telephoning
1-800-645-6561 or, if you are calling from overseas, call 516-794-5452.
REDEMPTION THROUGH A SELECTED DEALER -- If you are a customer of a Selected
Dealer, you may make redemption requests to your Selected Dealer. If the
Selected Dealer transmits the redemption request so that it is received by
the Transfer Agent by 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 such close of trading, 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.
SERVICE PLAN
Under the Service Plan, adopted pursuant to Rule 12b-1 under the 1940
Act, the Fund (a) reimburses the Distributor for payments to certain Service
Agents for distributing the Fund's shares and servicing shareholder accounts
("Servicing") and (b) pays The Dreyfus Corporation, Dreyfus Service
Corporation, a wholly-owned subsidiary of The Dreyfus Corporation, and any
affiliate of either of them (collectively, "Dreyfus") for advertising and
marketing relating to the Fund and for Servicing, at an aggregate annual rate
of .25 of 1% of the value of the Fund's average daily net assets. Each of the
Distributor and Dreyfus may pay one or more Service Agents a fee in respect
of the Fund's shares owned by shareholders with whom the Service Agent has a
Servicing relationship or for whom the Service Agent is the dealer or holder
of record. Each of the Distributor and Dreyfus determine the amount, if any,
to be paid to Service Agents under the Service Plan and the basis on which
such payments are made. The fees payable under the Service Plan are payable
without regard to actual expenses incurred.
Page 16
The Fund also bears the costs of preparing and printing prospectuses
and statements of additional information used for regulatory purposes and for
distribution to existing shareholders. Under the Service Plan, the Fund bears
(a) the costs of preparing, printing and distributing prospectuses and
statements of additional information used for other purposes, and (b) the
costs associated with implementing and operating the Service Plan (such as
costs of printing and mailing service agreements), the aggregate of such
amounts not to exceed in any fiscal year of the Fund the greater of $100,000
or .005 of 1% of the value of the Fund's average daily net assets for such
fiscal year. Each item for which a payment may be made under the Service Plan
may constitute an expense of distributing Fund shares as the Securities and
Exchange Commission construes such term under Rule 12b-1.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The Fund ordinarily declares dividends from net investment income on
each day the New York Stock Exchange is open for business. The Fund's
earnings for Saturdays, Sundays and holidays are declared as dividends on the
next business day. Dividends usually are paid on the last business day of
each month, and are automatically reinvested in additional Fund shares at net
asset value or, at your option, paid in cash. If you redeem all shares in
your account at any time during the month, all dividends to which you are
entitled will be paid to you along with the proceeds of the redemption. If
you are an omnibus accountholder and indicate in a partial redemption request
that a portion of any accrued dividends to which such account is entitled
belongs to an underlying accountholder who has redeemed all shares in his or
her account, such portion of the accrued dividends will be paid to you along
with the proceeds of the redemption. Distributions from net realized
securities gains, if any, generally are declared and paid once a year, but
the Fund may make distributions on a more frequent basis to comply with the
distribution requirements of the Code, in all events in a manner consistent
with the provisions of the 1940 Act. The Fund will not make distributions from
net realized securities gains unless capital loss carryovers, if any, have
been utilized or have expired. You may choose whether to receive
distributions in cash or to reinvest in additional Fund shares at net asset
value. All expenses are accrued daily and deducted before declaration of
dividends to investors.
Management of the Fund believes that the Fund was a "qualified
investment fund" within the meaning of the New Jersey gross income tax for
calendar year 1995. The primary criteria for constituting a "qualified
investment fund" are that (i) the Fund is an investment company registered
with the Securities and Exchange Commission, which for the calendar year in
which the dividends and distributions (if any) are paid, has no investments
other than interest-bearing obligations, obligations issued at a discount,
and cash and cash items, including receivables, and financial options,
futures and forward contracts, or other similar financial instruments
relating to interest-bearing obligations, obligations issued at a discount or
bond indexes related thereto and (ii) at the close of each quarter of the
taxable year, the Fund has not less than 80% of the aggregate principal
amount of all of its investments, excluding financial options, futures and
forward contracts, or other similar financial instruments related to
interest-bearing obligations, obligations issued at a discount or bond
indexes related thereto, cash and cash items, which cash items shall include
receivables, in New Jersey Municipal Obligations, including obligations of
Puerto Rico, the Virgin Islands and other territories and possessions of the
United States and certain other specified securities. Additionally, a
qualified investment fund must comply with certain continuing reporting
requirements.
If the Fund qualifies as a qualified investment fund and the Fund
complies with its reporting obligations, (a) dividends and distributions paid
by the Fund to a New Jersey resident individual shareholder will not be
subject to New Jersey gross income tax to the extent that the dividends and
distributions are attributable to income earned by the Fund as interest on or
gain from New Jersey Municipal Obligations, and (b) gain from the sale of
Fund shares by a New Jersey resident individual shareholder will not subject
to the New Jersey gross income tax. Shares of the Fund are not subject to
property taxa-
Page 17
tion by New Jersey or its political subdivisions. To the extent
that you are subject to state and local taxes outside of New Jersey,
dividends and distributions earned by an investment in the Fund and gain from
the sale of shares in the Fund may represent taxable income.
Except for dividends from Taxable Investments, the Fund anticipates
that substantially all dividends from net investment income paid by the Fund
will not be subject to Federal income tax. Dividends derived from Taxable
Investments, together with distributions from any net realized short-term
securities gains and all or a portion of any gains realized from the sale or
other disposition of certain market discount bonds, paid by the Fund are
subject to Federal income tax as ordinary income, whether or not reinvested
in additional Fund shares. No dividend paid by the Fund will qualify for the
dividends received deduction allowable to certain U.S. corporations.
Distributions from net realized long-term securities gains of the Fund
generally are taxable as long-term capital gains for Federal income tax
purposes if you are a citizen or resident of the United States. Dividends and
distributions from gain derived from securities transactions and from the use
of the investment techniques described under "Appendix -- Investment
Techniques" also will be subject to Federal income tax. The Code provides
that the net capital gain of an individual generally will not be subject to
Federal income tax at a rate in excess of 28%. Under the Code, interest on
indebtedness incurred or continued to purchase or carry Fund shares which is
deemed to relate to exempt-interest dividends is not deductible.
Although all or a substantial portion of the dividends paid by the
Fund may be excluded by shareholders of the Fund from their gross income for
Federal income tax purposes, the Fund may purchase specified private activity
bonds, the interest from which may be (i) a preference item for purposes of
the alternative minimum tax, (ii) a component of the "adjusted current
earnings" preference item for purposes of the corporate alternative minimum
tax as well as a component in computing the corporate environmental tax or
(iii) a factor in determining the extent to which a shareholder's Social
Security benefits are taxable. If the Fund purchases such securities, the
portion of the Fund's dividends related thereto will not necessarily be tax
exempt to an investor who is subject to the alternative minimum tax and/or
tax on Social Security benefits and may cause an investor to be subject to
such taxes.
Notice as to the tax status of your dividends and distributions will
be mailed to you annually. You also will receive periodic summaries of your
account which will include information as to dividends and distributions from
securities gains, if any, paid during the year. These statements set forth
the dollar amount of income exempt from Federal tax and the dollar amount, if
any, subject to Federal tax. These dollar amounts will vary depending on the
size and length of time of your investment in the Fund. If the Fund pays
dividends derived from taxable income, it intends to designate as taxable the
same percentage of the day's dividends as the actual taxable income earned on
that day bears to total income earned on that day. Thus, the percentage of
the dividend designated as taxable, if any, may vary from day to day.
The exchange of shares of one fund for shares of another is treated
for Federal income tax purposes as a sale of the shares given in exchange by
the shareholder and, therefore, an exchanging shareholder may realize a
taxable gain or loss.
Federal regulations generally require the Fund to withhold ("backup
withholding") and remit to the U.S. Treasury 31% of taxable dividends,
distributions from net realized securities gains and the proceeds of any
redemption, regardless of the extent to which gain or loss may be realized,
paid to a shareholder if such shareholder fails to certify either that the
TIN furnished in connection with opening an account is correct, or that such
shareholder has not received notice from the IRS of being subject to backup
withholding as a result of a failure to properly report taxable dividend or
interest income on a Federal income tax return. Furthermore, the IRS may
notify the Fund to institute backup withholding if the IRS determines a
shareholder's TIN is incorrect or if a shareholder has failed to properly
report taxable dividend and interest income on a Federal income tax return.
A TIN is either the Social Security number or employer identification
number of the record owner of the account. Any tax withheld as a result of
backup withholding does not constitute an additional tax imposed on the
record owner of the account, and may be claimed as a credit on the record
owner's Federal income tax return.
Page 18
Management of the Fund believes that the Fund has qualified for the
fiscal year ended December 31, 1995 as a "regulated investment company" under
the Code. The Fund intends to continue to so qualify if such qualification is
in the best interests of its shareholders. Such qualification relieves the
Fund of any liability for Federal income taxes to the extent its earnings are
distributed in accordance with applicable provisions of the Code. The Fund is
subject to a non-deductible 4% excise tax, measured with respect to certain
undistributed amounts of taxable investment income and capital gains.
You should consult your tax adviser regarding specific questions as
to Federal, state or local taxes.
PERFORMANCE INFORMATION
For purposes of advertising, performance may be calculated on several
bases, including current yield, tax equivalent yield, average annual total
return and/or total return.
Current yield refers to the Fund's annualized net investment income
per share over a 30-day period, expressed as a percentage of the net asset
value per share at the end of the period. For purposes of calculating current
yield, the amount of net investment income per share during that 30-day
period, computed in accordance with regulatory requirements, is compounded by
assuming that it is reinvested at a constant rate over a six-month period. An
identical result is then assumed to have occurred during a second six-month
period which, when added to the result for the first six months, provides an
"annualized" yield for an entire one-year period. Calculations of the Fund's
current yield may reflect absorbed expenses pursuant to any undertaking that
may be in effect. See "Management of the Fund."
Tax equivalent yield is calculated by determining the pre-tax yield
which, after being taxed at a stated rate, would be equivalent to a stated
current yield calculated as described above.
For purposes of advertising, certain calculations of average annual
total return and total return will take into account the performance of
Dreyfus New Jersey Tax Exempt Bond Fund, L.P., the assets and liabilities of
which were transferred to the Fund in exchange for shares of the Fund on
August 31, 1988. See "General Information."
Average annual total return is calculated pursuant to a standardized
formula which assumes that an investment in the Fund was purchased with an
initial payment of $1,000 and that the investment was redeemed at the end of
a stated period of time, after giving effect to the reinvestment of dividends
and distributions during the period. The return is expressed as a percentage
rate which, if applied on a compounded annual basis, would result in the
redeemable value of the investment at the end of the period. Advertisements
of the Fund's performance will include the Fund's average annual total return
for one, five and ten year periods, or for shorter time periods depending
upon the length of time during which the Fund has operated.
Total return is computed on a per share basis and assumes the
reinvestment of dividends and distributions. Total return generally is
expressed as a percentage rate which is calculated by combining the income
and principal changes for a specified period and dividing by the net asset
value per share at the beginning of the period. Advertisements may include
the percentage rate of total return or may include the value of a
hypothetical investment at the end of the period which assumes the
application of the percentage rate of total return.
Performance will vary from time to time and past results are not
necessarily representative of future results. You should remember that
performance is a function of portfolio management in selecting the type and
quality of portfolio securities and is affected by operating expenses.
Performance information, such as that described above, may not provide a
basis for comparison with other investments or other investment companies
using a different method of calculating performance.
Page 19
Comparative performance information may be used from time to time in
advertising or marketing the Fund's shares, including data from CDA
Investment Technologies, Inc., Lipper Analytical Services, Inc., Moody's Bond
Survey Bond Index, Lehman Brothers Municipal Bond Index, Morningstar, Inc.
and other industry publications. The Fund's yield generally should be higher
than that of shorter-term funds (which generally fluctuate less in price per
share).
GENERAL INFORMATION
The Fund was incorporated under Maryland law on January 11, 1988, and
commenced operations on August 31, 1988. Before September 14, 1990, the
Fund's name was Dreyfus New Jersey Tax Exempt Bond Fund, Inc. The Fund is
authorized to issue 500 million shares of Common Stock, par value $.001 per
share. Each share has one vote.
On August 31, 1988, all of the assets and liabilities of Dreyfus New
Jersey Tax Exempt Bond Fund, L.P. (the "Partnership") were transferred to the
Fund in exchange for shares of Common Stock of the Fund pursuant to a
proposal approved at a Meeting of Partners of the Partnership held on August
17, 1988.
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, pursuant to the Fund's By-Laws, 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 the purpose of
removing a Board member from office and the holders of at least 25% of such
shares may require the Fund to hold a special meeting of shareholders for any
other purpose. Fund shareholders may remove a Board member by the affirmative
vote of a majority of the Fund's outstanding voting shares. In addition, the
Fund's 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 Transfer Agent maintains a record of your ownership and sends
confirmations and statements of account.
Shareholder inquiries may be made to your Service Agent or by writing
to the Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144,
or by calling toll free 1-800-645-6561. In New York City, call
1-718-895-1206; outside the U.S. and Canada, call 516-794-5452.
Page 20
APPENDIX
INVESTMENT TECHNIQUES
BORROWING MONEY -- The Fund is permitted to borrow to the extent permitted
under the 1940 Act, which permits an investment company to borrow in an
amount up to 331/3% 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 the borrowing is
made. While borrowings exceed 5% of the Fund's total assets, the Fund will
not make any additional investments.
LENDING PORTFOLIO SECURITIES -- TheFund 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 331/3% 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.
USE OF DERIVATIVES -- The Fund may invest in the types of Derivatives
enumerated under "Description of the Fund -- Investment Considerations and
Risks -- Use of Derivatives." These instruments and certain related risks are
described more specifically under "Investment Objective and Management
Policies -- Management Policies -- Derivatives" in the Statement of
Additional Information.
Derivatives can be volatile and involve various types and degrees
of risk, depending upon the characteristics of the particular Derivative and
the portfolio as a whole. Derivatives permit the Fund to increase or decrease
the level of risk, or change the character of the risk, to which its
portfolio is exposed in much the same way as the Fund can increase or
decrease the level of risk, or change the character of the risk, of its
portfolio by making investments in specific securities.
Derivatives may entail investment exposures that are greater than
their cost would suggest, meaning that a small investment in Derivatives
could have a large potential impact on the Fund's performance.
If the Fund invests in Derivatives at inappropriate 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 it 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.
The Fund may invest up to 5% of its assets, represented by the
premium paid, in the purchase of call options. The Fund may write (i.e.,
sell) covered call option contracts to the extent of 20% of the value of its
net assets at the time such option contracts are written. When required by
the Securities and Exchange Commission, the Fund will set aside permissible
liquid assets in a segregated account to cover its obligations relating to
its transactions in Derivatives. To maintain this required cover, the Fund
may have to sell portfolio securities at disadvantageous prices or times
since it may not be possible to liquidate a Derivative position at a
reasonable price.
FORWARD COMMITMENTS -- The Fund may purchase Municipal Obligations and other
securities on a forward commitment or when-issued basis, which means that
delivery and payment take place a number of days after the date of the
commitment to purchase. The payment obligation and the interest rate
receivable
Page 21
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. A segregated account of the Fund consisting of cash, cash
equivalents or U.S. Government securities or other high quality liquid debt
securities at least equal at all times to the amount of the commitments will
be established and maintained at the Fund's custodian bank.
CERTAIN PORTFOLIO SECURITIES
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 meets the prescribed
quality standards for banks set forth below, 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.
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 Dreyfus Corporation, on behalf of the Fund,
will consider on an ongoing basis the creditworthiness of the issuer of the
underlying Municipal Obligation, of any custodian and of the third party
provider
Page 22
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 Obligation and
for other reasons.
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 expected to be below the coupon rate of
the underlying Municipal Obligations and generally is at a level comparable
to that of a 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.
If the interest rate on the first class exceeds the coupon rate of the
underlying Municipal Obligations, its interest rate will exceed the rate paid
on the second 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 part of a multi-class offering and the interest
rate on certain classes may be subject to a cap or floor.
STAND-BY COMMITMENTS -- To the extent consistent with the requirements for a
"qualified investment fund" under the New Jersey gross income tax, 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 its 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.
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 interest in such stripped debt obliga-
Page 23
tions 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.
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 certain securities that are subject to legal or
contractual restrictions on resale, and repurchase agreements providing for
settlement in more than seven days after notice. As to these securities, the
Fund is subject to a risk that should the Fund desire to sell them when a
ready buyer is not available at a price the Fund deems representative of
their value, the value of the Fund's net assets could be adversely affected.
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 Moody's, S&P or Fitch; obligations of the U.S.
Government, its agencies or instrumentalities; commercial paper rated not
lower than P-2 by Moody's, A-2 by S&P or F-2 by Fitch; certificates of
deposit of U.S. domestic banks, including foreign branches of domestic banks,
with assets of one billion dollars 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 New Jersey
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 New Jersey personal income taxes. 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. Taxable
Investments are more fully described in the Statement of Additional
Information, to which reference hereby is made.
RATINGS _ Bonds rated Ba by Moody's are judged to have speculative elements;
their future cannot be considered as well assured and often the protection of
interest and principal payments may be very moderate. Bonds rated BB by S&P
are regarded as having predominantly speculative characteristics and, while
such obligations have less near-term vulnerability to default than other
speculative grade debt, they face major ongoing uncertainties or exposure to
adverse business, financial or economic conditions which could lead to
inadequate capacity to meet timely interest and principal payments. Bonds
rated BB by Fitch are considered speculative and the payment of principal and
interest may be affected at any time by adverse economic changes. Bonds rated
C by Moody's are regarded as having extremely poor prospects of ever
attaining any real investment standing. Bonds rated D by S&P are in default
and the payment of interest and/or repayment of principal is in arrears.
Bonds rated DDD, DD or D by Fitch are in actual or imminent default, are
extremely speculative and should be valued on the basis of their ultimate
recovery value in liquidation or reorganization of the issuer; DDD represents
the highest potential for recovery of such bonds; and D represents the lowest
potential for recovery. Such bonds, though high yielding, are characterized
by great risk. See "Appendix B" in the Statement of Additional Information
for a general description of Moody's, S&P and Fitch ratings of Municipal
Obligations.
The ratings of Moody's, S&P and Fitch 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,
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. Although these ratings may be an initial criteri-
Page 24
on for selection of portfolio investments, The Dreyfus Corporation also will
evaluate these securities and the ability of the issuers of such securities
to pay interest and principal. The Fund's ability to achieve its investment
objective may be more dependent on The Dreyfus Corporation's credit analysis
than might be the case for a fund that invested in higher rated securities.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATIONS OTHER THAN THOSE CONTAINED IN THIS PROSPECTUS AND IN THE
FUND'S OFFICIAL SALES LITERATURE IN CONNECTION WITH THE OFFER OF THE FUND'S
SHARES, AND, IF GIVEN OR MADE, SUCH OTHER INFORMATION OR REPRESENTATIONS MUST
NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE FUND. THIS PROSPECTUS
DOES NOT CONSTITUTE AN OFFER IN ANY STATE IN WHICH, OR TO ANY PERSON TO WHOM,
SUCH OFFERING MAY NOT LAWFULLY BE MADE.
Page 25
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Page 27
DREYFUS
New Jersey
Municipal
Bond Fund, Inc.
Prospectus
(LION LOGO)
Registration Mark
Copy Rights 1996 Dreyfus Service Corporation
750p050196
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
PART B
(STATEMENT OF ADDITIONAL INFORMATION)
MAY 1, 1996
This Statement of Additional Information, which is not a prospectus,
supplements and should be read in conjunction with the current Prospectus
of Dreyfus New Jersey Municipal Bond Fund, Inc. (the "Fund"), dated May 1,
1996 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 the following numbers:
Call Toll Free 1-800-645-6561
In New York City -- Call 1-718-895-1206
Outside the U.S. and Canada -- Call 516-794-5452
The Dreyfus Corporation (the "Manager") serves as the Fund's
investment adviser.
Premier Mutual Fund Services, Inc. (the "Distributor") is the
distributor of the Fund's shares.
TABLE OF CONTENTS
Page
Investment Objective and Management Policies . . . . . . B-2
Management of the Fund. . . . . . . . . . . . . . . . . . B-10
Management Agreement. . . . . . . . . . . . . . . . . . . B-14
Purchase of Shares. . . . . . . . . . . . . . . . . . . . B-16
Service Plan. . . . . . . . . . . . . . . . . . . . . . . B-17
Redemption of Shares. . . . . . . . . . . . . . . . . . . B-18
Shareholder Services. . . . . . . . . . . . . . . . . . . B-20
Determination of Net Asset Value. . . . . . . . . . . . . B-22
Portfolio Transactions. . . . . . . . . . . . . . . . . . B-23
Dividends, Distributions and Taxes. . . . . . . . . . . . B-23
Performance Information . . . . . . . . . . . . . . . . . B-24
Information About the Fund. . . . . . . . . . . . . . . . B-25
Transfer and Dividend Disbursing Agent, Custodian,
Counsel and Independent Auditors. . . . . . . . . . . . B-26
Appendix A. . . . . . . . . . . . . . . . . . . . . . . . B-27
Appendix B. . . . . . . . . . . . . . . . . . . . . . . . B-30
Financial Statements. . . . . . . . . . . . . . . . . . . B-39
Report of Independent Auditors. . . . . . . . . . . . . . B-51
INVESTMENT OBJECTIVE AND MANAGEMENT POLICIES
The following information supplements and should be read in
conjunction with the sections in the Fund's Prospectus entitled
"Description of the Fund" and "Appendix."
Portfolio Securities
The average distribution of investments (at value) in Municipal
Obligations (including notes) by ratings for the fiscal year ended December
31, 1995, computed on a monthly basis, was as follows:
Fitch Moody's Standard
Investors Investors & Poor's
Service, L.P. Service, Inc. Ratings Group Percentage
("Fitch") or ("Moody's") or ("S&P") of Value
AAA Aaa AAA 46.4%
AA Aa AA 6.2%
A A A 18.7%
BBB Baa BBB 12.2%
BB Ba BB 3.0%
B B B 1.2%
F-1 MIG 11, P-1 SP-11, A-1 1.0%
Not Rated Not Rated Not Rated 11.3%
100.0%
Municipal Obligations. The term "Municipal Obligations" generally
includes debt obligations issued to obtain funds for various public
purposes, including the construction of a wide range of public facilities
such as airports, bridges, highways, housing, hospitals, mass
transportation, schools, streets and water and sewer works. Other public
purposes for which Municipal Obligations may be issued include refunding
outstanding obligations, obtaining funds for general operating expenses and
lending such funds to other public institutions and facilities. In
addition, certain types of industrial development bonds are issued by or on
behalf of public authorities to obtain funds to provide for the
construction, equipment, repair or improvement of privately operated
housing facilities, sports facilities, convention or trade show facilities,
airport, mass transit, industrial, port or parking facilities, air or water
pollution control facilities and certain local facilities for water supply,
gas, electricity, or sewage or solid waste disposal; the interest paid on
such obligations may be exempt from Federal income tax, although current
tax laws place substantial limitations on the size of such issues. Such
obligations are considered to be Municipal Obligations if the interest paid
thereon qualifies as exempt from Federal income tax in the opinion of bond
counsel to the issuer. There are, of course, variations in the security of
Municipal Obligations, both within a particular classification and between
classifications.
Floating and variable rate demand obligations 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. The issuer of such obligations ordinarily has a
corresponding right, after a given period, to prepay in its discretion the
outstanding principal amount of the obligations plus accrued interest upon
a specified number of days' notice to the holders thereof. The interest
rate on a floating rate demand obligation is based on a known lending rate,
such as a bank's prime rate, and is adjusted automatically each time such
rate is adjusted. The interest rate on a variable rate demand obligation
is adjusted automatically at specified intervals.
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.
The imposition of the Fund's management fee, as well as other operating
expenses, including fees paid under the Service Plan, will have the effect
of reducing the yield to investors.
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. The Fund will not invest more than 15% of the
value of its net assets in lease obligations that are illiquid and in other
illiquid securities. See "Investment Restriction No. 11" below.
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.
Ratings of Municipal Obligations. 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 Moody's, S&P or Fitch 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
Fund's Prospectus and this Statement of Additional Information. The
ratings of Moody's, S&P and Fitch 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.
Illiquid Securities. Where a substantial market of qualified
institutional buyers develops for certain restricted securities purchased
by the Fund pursuant to Rule 144A under the Securities Act of 1933, as
amended, the Fund intends to treat such securities as liquid securities in
accordance with procedures approved by the Fund's Board. Because it is not
possible to predict with assurance how the market for restricted securities
pursuant to Rule 144A will develop, the Fund's Board has directed the
Manager to monitor carefully the Fund's investments in such securities with
particular regard to trading activity, availability of reliable price
information and other relevant information. To the extent that for a
period of time qualified institutional buyers cease purchasing restricted
securities pursuant to Rule 144A, the Fund's investing in such securities
may have the effect of increasing the level of illiquidity in the Fund's
portfolio during such period.
Taxable Investments. Securities issued or guaranteed by the U.S.
Government or its agencies or instrumentalities include U.S. Treasury
securities, which differ in their interest rates, maturities and times of
issuance. Some obligations issued or guaranteed by U.S. Government
agencies and instrumentalities are supported by the full faith and credit
of the U.S. Treasury; others by the right of the issuer to borrow from the
U.S. Treasury; others by discretionary authority of the U.S. Government to
purchase certain obligations of the agency or instrumentality; and others
only by the credit of the agency or instrumentality. These securities bear
fixed, floating or variable rates of interest. Interest rates may
fluctuate based on generally recognized reference rates or the relationship
of rates. While the U.S. Government provides financial support to such
U.S. Government-sponsored agencies or instrumentalities, no assurance can
be given that it will always do so, since it is not so obligated by law.
Commercial paper consists of short-term, unsecured promissory notes
issued to finance short-term credit needs.
Certificates of deposit are negotiable certificates representing the
obligation of a bank to repay funds deposited with it for a specified
period of time.
Time deposits are non-negotiable deposits maintained in a banking
institution for a specified period of time (in no event longer than seven
days) at a stated interest rate. Investments in time deposits generally
are limited to London branches of domestic banks that have total assets in
excess of one billion dollars. Time deposits which may be held by the Fund
will not benefit from insurance from the Bank Insurance Fund or the Savings
Association Insurance Fund administered by the Federal Deposit Insurance
Corporation.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments
reflect the obligation both of the bank and of the drawer to pay the face
amount of the instrument upon maturity. Other short-term bank obligations
may include uninsured, direct obligations bearing fixed, floating or
variable interest rates.
In a repurchase agreement, the Fund buys, and the seller agrees to
repurchase, a security at a mutually agreed upon time and price (usually
within seven days). The repurchase agreement thereby determines the yield
during the purchaser's holding period, while the seller's obligation to
repurchase is secured by the value of the underlying security. The Fund's
custodian will have custody of, and will hold in a segregated account,
securities acquired by the Fund under a repurchase agreement. Repurchase
agreements are considered by the staff of the Securities and Exchange
Commission to be loans by the Fund. In an attempt to reduce the risk of
incurring a loss on a repurchase agreement, the Fund will enter into
repurchase agreements only with domestic banks with total assets in excess
of $1 billion, or primary government securities dealers reporting to the
Federal Reserve Bank of New York, with respect to securities of the type in
which the Fund may invest, and will require that additional securities be
deposited with it if the value of the securities purchased should decrease
below resale price. Repurchase agreements could involve risks in the event
of a default or insolvency of the other party to the agreement, including
possible delays or restrictions upon the Fund's ability to dispose of the
underlying securities.
Management Policies
Derivatives. The Fund may invest in Derivatives 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 a Fund to invest than "traditional" securities
would.
Derivatives may be purchased on established exchanges or through
privately negotiated transactions referred to as over-the-counter
Derivatives. Exchange-traded Derivatives generally are guaranteed by the
clearing agency which is the issuer or counterparty to such Derivatives.
This guarantee usually is supported by a daily payment system (i.e.,
variation margin requirements) operated by the clearing agency in order to
reduce overall credit risk. As a result, unless the clearing agency
defaults, there is relatively little counterparty credit risk associated
with Derivatives purchased on an exchange. By contrast, no clearing agency
guarantees over-the-counter Derivatives. Therefore, each party to an over-
the-counter Derivative bears the risk that the counterparty will default.
Accordingly, the Manager 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.
Options--In General. The Fund may purchase and write (i.e., sell) call
options with respect to Municipal Obligations. 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.
A covered call option written by the Fund is a call option with
respect to which the Fund owns the underlying security or otherwise covers
the transaction by segregating cash or other securities. The principal
reason for writing covered call 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
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 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 Portfolio'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 Statement of Additional Information.
Lending Portfolio Securities. 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 from securities loaned.
The Securities and Exchange Commission currently requires that the
following conditions must be met whenever portfolio securities are loaned:
(1) the Fund must receive at least 100% cash collateral from the borrower;
(2) the borrower must increase such collateral whenever the market value of
the securities rises above the level of such collateral; (3) the Fund must
be able to terminate the loan at any time; (4) the Fund must receive
reasonable interest on the loan, as well as any interest or other
distributions payable on the loaned securities, and any increase in market
value; and (5) the Fund may pay only reasonable custodian fees in
connection with the loan. These conditions may be subject to future
modification.
Forward 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 a Fund to risks
because they may experience such fluctuations prior to their actual
delivery. Purchasing securities on a when-issued basis can involve the
additional risk that the yield available in the market when the delivery
takes place actually may be higher than that obtained in the transaction
itself. Purchasing securities on a when-issued basis when a 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 Considerations and Risks
Investing in New Jersey Municipal Obligations. Investors should
consider carefully the special risks inherent in the Fund's investment in
New Jersey Municipal Obligations. If there should be a default of other
financial crisis relating to the State of New Jersey or an agency or
municipality thereof, the market value and marketability of outstanding New
Jersey Municipal Obligations in the Fund's portfolio and interest income to
the Fund could be adversely affected. These risks result from the
financial condition of the State of New Jersey. Although New Jersey
enjoyed a period of economic growth with unemployment levels below the
national average during the mid-1980s, its economy slowed down well before
the onset of the national recession, which, according to the National
Bureau of Economic Research, began in July 1990. Reflecting the economic
downturn, the State's unemployment rate rose from a low of 3.6% in the
first quarter of 1989 to a recessionary peak of 9.3% during 1992. Since
then, the State's unemployment rate fell to 6.4% during the first ten
months of 1995. As a result of New Jersey's recent fiscal weakness, in
July 1991, S&P lowered its rating of the State's general obligation debt
from AAA to AA+. Investors should review "Appendix A" which sets forth
these and other risk factors.
Lower Rated Bonds. The Fund is permitted to invest in securities
rated Ba by Moody's or BB by S&P or Fitch and as low as the lowest rating
assigned by Moody's, S&P or Fitch. Such bonds, though higher yielding, are
characterized by risk. See "Description of the Fund--Investment
Considerations and Risks--Lower Rated Bonds" in the Prospectus for a
discussion of certain risks and "Appendix B" for a general description of
Moody's, S&P and Fitch 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.
Investors 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 and will fluctuate over time. These bonds generally are
considered by S&P, Moody's and Fitch 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, 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 an economic recession could severely disrupt the market for
such securities and may have an adverse impact on the value of such
securities. In addition, it is likely that any such economic downturn
could adversely affect the ability of the issuers of such securities to
repay principal and pay interest thereon and increase the incidence of
default for such securities.
The 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, in which the Fund may invest up to
5% of its total assets. Such zero coupon 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."
Investment Restrictions
The Fund has adopted investment restrictions numbered 1 through 7
below as fundamental policies, which cannot be changed without approval by
the holders of a majority (as defined in the Investment Company Act of
1940, as amended (the "1940 Act")) of the Fund's outstanding voting shares.
Investment restrictions numbered 8 through 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. 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.
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). For purposes of this investment restriction, the
entry into options, forward contracts, futures contracts, including those
relating to indices, and options on futures contracts or indices shall not
constitute borrowing.
3. Purchase or sell real estate, 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 options, forward
contracts, futures contracts, including those relating to indices, and
options on futures contracts 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. Make loans to others, except through the purchase of debt
obligations and the entry into repurchase agreements; 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 Board.
6. Issue any senior security (as such term is defined in
Section 18(f) of the 1940 Act), except to the extent that the activities
permitted in Investment Restrictions numbered 2, 3 and 10 may be deemed to
give rise to a senior security.
7. Sell securities short or purchase securities on margin, but the
Fund may make margin deposits in connection with transactions in options,
forward contracts, futures contracts, including those relating to indices,
and options on futures contracts or indices.
8. Purchase securities other than Municipal Obligations and Taxable
Investments and those arising out of transactions in futures and options or
as otherwise provided in the Fund's Prospectus.
9. Invest in securities of other investment companies, except to the
extent permitted under the 1940 Act.
10. Pledge, hypothecate, mortgage or otherwise encumber its assets,
except to the extent necessary to secure permitted borrowings and to the
extent related to the deposit of assets in escrow in connection with the
purchase of securities on a when-issued or delayed-delivery basis and
collateral and initial or variation margin arrangements with respect to
options, forward contracts, futures contracts, including those related to
indices, and options on futures contracts or indices.
11. 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 (including
municipal lease/purchase agreements) that are not subject to the demand
feature described in the Fund's Prospectus, and floating and variable rate
demand obligations as to which the Fund cannot exercise the demand feature
described in the Fund's Prospectus on less than seven days' notice and as
to which there is no secondary market) if, in the aggregate, more than 15%
of its net assets would be so invested.
12. Invest in companies for the purpose of exercising control.
For purposes of Investment Restriction No. 1, 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 or decrease in percentage resulting from a
change in values or assets will not constitute a violation of such
restriction.
The Fund may make commitments more restrictive than the restrictions
listed above so as to permit the sale of Fund shares in certain states.
Should the Fund determine that a commitment is no longer in the best
interests of the Fund and its shareholders, the Fund reserves the right to
revoke the commitment by terminating the sale of Fund shares in the state
involved.
MANAGEMENT OF THE FUND
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. Each Board member who is deemed to be an
"interested person" of the Fund, as defined in the 1940 Act, is indicated
by an asterisk.
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. For
more than five years prior thereto, he was President, a director and,
until August 1994, Chief Operating Officer of the Manager and
Executive Vice President and a director of Dreyfus Service
Corporation, a wholly-owned subsidiary of the Manager and, until
August 24, 1994, the Fund's distributor. From August 1994 to December
31, 1994, he was a director of Mellon Bank Corporation. He is
Chairman of the Board of Directors of the Noel Group, Inc.; a trustee
of Bucknell University; and a director of the Muscular Dystrophy
Association, HealthPlan Services Corporation, Belding Heminway
Company, Inc., Curtis Industries, Inc. and Staffing Resources, Inc.
He is 52 years old and his address is 200 Park Avenue, New York, New
York 10166.
GORDON J. DAVIS, Board Member. Since October 1994, Mr. Davis has been a
senior partner with the law firm of LeBoeuf, Lamb, Greene & MacRae.
From 1983 to September 1994, he was a senior partner with the law firm
of Lord Day & Lord, Barrett Smith. Mr. Davis was Commissioner of
Parks and Recreation for the City of New York from 1978 to 1983. He
is also a Director of Consolidated Edison, a utility company, and
Phoenix Home Life Insurance Company and a member of various other
corporate and not-for-profit boards. Mr. Davis is 54 years old and
his address is 241 Central Park West, New York, New York 10024.
*DAVID P. FELDMAN, Board Member. Corporate Vice President-Investment
Management of AT&T. He is also a trustee of Corporate Property
Investors, a real estate investment company. Mr. Feldman is 56 years
old and his address is One Oak Way, Berkeley Heights, New Jersey
07922.
LYNN MARTIN, Board Member. Professor, J.L. Kellogg Graduate School of
Management, Northwestern University. During the Spring Semester of
1993, she was a Visiting Fellow at the Institute of Politics, Kennedy
School of Government, Harvard University. She also is an advisor to
the international accounting firm of Deloitte & Touche, LLP and chair
of its Council for the Advancement of Women. From January 1991
through January 1993, Ms. Martin served as Secretary of the United
States Department of Labor. From 1981 to 1991, she served in the
United States House of Representatives as a congresswoman from the
state of Illinois. She also is a director of Harcourt General, Inc.;
Ameritech; Ryder System, Inc.; The Proctor & Gamble Co.; and TRW, Inc.
She is 56 years old and her address is Deloitte & Touche, LLP, Two
Prudential Plaza, 180 N. Stetson Avenue, Chicago, Illinois, 60601.
EUGENE McCARTHY, Board Member Emeritus. Writer and columnist; former
Senator from Minnesota from 1958-1970. He also is a director of
Harcourt Brace Jovanovich, Inc. He is 80 years old and his address is
271 Hawlin Road, Woodville, Virginia 22749.
DANIEL ROSE, Board Member. President and Chief Executive Officer of Rose
Associates, Inc., a New York based real estate development and
management firm. In July 1994, Mr. Rose received a Presidential
appointment to serve as a Director of the Baltic American Enterprise
Fund, which will make equity investments and loans and provide
technical business assistance to new business concerns in the Baltic
States. He is also Chairman of the Housing Committee of The Real
Estate Board of New York, Inc., and a Trustee of Corporate Property
Investors, a real estate investment company. Mr. Rose is 66 years old
and his address is c/o Rose Associates, Inc., 200 Madison Avenue, New
York, New York 10016.
SANDER VANOCUR, Board Member. Since May 1995, Mr. Vanocur has been a
Professional in Residence at the Freedom Forum in Arlington, VA. From
January 1994 to May 1995, he has served as Visiting Professional
Scholar at the Freedom Forum First Amendment Center of Vanderbilt
University. Since January 1992, Mr. Vanocur has been the President of
Old Owl Communications, a full-service communications firm, and since
November 1989, he has served as a Director of the Damon Runyon-Walter
Winchell Cancer Research Fund. From June 1986 to December 1991, he
was a Senior Correspondent of ABC News and, from October 1986 to
December 1991, he was Anchor of the ABC News program "Business World,"
a weekly business program on the ABC television network. Mr. Vanocur
is 68 years old and his address is 2928 P Street, N.W., Washington,
D.C. 20007.
ANNE WEXLER, Board Member. Chairman of the Wexler Group, consultants
specializing in government relations and public affairs. She is also
a Director of Alumax, Comcast Corporation, The New England Electric
System, NOVA Corporation and a member of the Board of the Carter
Center of Emory University, the Council of Foreign Relations, the
National Park Foundation; the Visiting Committee of the John F.
Kennedy School of Government at Harvard University and the Board of
Visitors of the University of Maryland School of Public Affairs. Ms.
Wexler is 66 years old and her address is 1317 F Street, N.W.,
Washington, D.C. 20004.
REX WILDER, Board Member. Financial Consultant. Mr. Wilder is 75 years
old and his address is 290 Riverside Drive, New York, New York 10025.
For so long as the Fund's plan described in the section captioned
"Service Plan" remains in effect, the Board members of the Fund who are not
"interested persons" of the Fund, as defined in the 1940 Act, will be
selected and nominated by the Board members who are not "interested
persons" of the Fund.
The Fund typically pays its Board members an annual retainer and a per
meeting fee and reimburses them for their expenses. The Chairman of the
Board receives an additional 25% of such compensation. Emeritus Board
members are entitled to receive an annual retainer and a per meeting fee of
one-half the amount paid to them as Board members. The aggregate amount of
compensation paid to each Board member by the Fund and by all other funds
in the Dreyfus Family of Funds for which such person is a Board member (the
number of which is set forth in parenthesis next to each Board member's
total compensation) for the year ended December 31, 1995 were as follows:
Total Compensation
Aggregate from Fund and Fund
Name of Board Compensation from Complex Paid to
Member Fund* Board Members
Gordon J. Davis $4,000 $ 76,575 (26)
Joseph S. DiMartino $4,688 $448,618 (93)
David P. Feldman $4,000 $113,783 (12)
Lynn Martin $3,750 $ 38,500 (28)
Eugene McCarthy+ $4,000 $ 41,250 (12)
Daniel Rose $4,000 $ 80,250 (22)
Sander Vanocur $4,000 $ 79,750 (22)
Anne Wexler $3,750 $ 62,201 (17)
Rex Wilder $4,000 $ 41,250 (12)
_________________________
* Amount does not include reimbursed expenses for attending Board meetings,
which amounted to $595 for all Board members as a group.
+ Board Member Emeritus since March 29, 1996.
Officers of the Fund
MARIE E. CONNOLLY, President and Treasurer. President and Chief Executive
Officer of the Distributor and an officer of other investment
companies advised or administered by the Manager. From December 1991
to July 1994, she was President and Chief Compliance Officer of Funds
Distributor, Inc., the ultimate parent of which is Boston
Institutional Group, Inc. Prior to December 1991, she served as Vice
President and Controller, and later as Senior Vice President, of The
Boston Company Advisors, Inc. She is 38 years old.
JOHN E. PELLETIER, Vice President and Secretary. Senior Vice President and
General Counsel of the Distributor and an officer of other investment
companies advised or administered by the Manager. From February 1992
to July 1994, he served as Counsel for The Boston Company Advisors,
Inc. From August 1990 to February 1992, he was employed as an
Associate at Ropes & Gray. He is 31 years old.
ERIC B. FISCHMAN, Vice President and Assistant Secretary. Associate
General Counsel of the Distributor and an officer of other investment
companies advised or administered the Manager. From September 1992 to
August 1994, he was an attorney with the Board of Governors of the
Federal Reserve System. He is 31 years old.
ELIZABETH BACHMAN, Vice President and Assistant Secretary. Assistant Vice
President of the Distributor and an officer of other investment
companies advised or administered by the Manager. She is 26 years
old.
FREDERICK C. DEY, Vice President and Assistant Treasurer. Senior Vice
President of the Distributor and an officer of other investment
companies advised or administered by the Manager. From 1988 to August
1994, he was manager of the High Performance Fabric Division of
Springs Industries Inc. He is 34 years old.
JOSEPH F. TOWER, III, Assistant Treasurer. Senior Vice President,
Treasurer and Chief Financial Officer of the Distributor and an
officer of other investment companies advised or administered by the
Manager. From July 1988 to August 1994, he was employed by The Boston
Company, Inc. where he held various management positions in the
Corporate Finance and Treasury areas. He is 33 years old.
JOHN J. PYBURN, Assistant Treasurer. Assistant Treasurer of the
Distributor and an officer of other investment companies advised or
administered by the Manager. From 1984 to July 1994, he was Assistant
Vice President in the Mutual Fund Accounting Department of the
Manager. He is 60 years old.
MARGARET M. PARDO, Assistant Secretary. Legal Assistant with the
Distributor and an officer of other investment companies advised or
administered by the Manager. From June 1992 to April 1995, she was a
Medical Coordination Officer at ORBIS International. Prior to June
1992, she worked as Program Coordinator at Physicians World
Communications Group. She is 27 years old.
The address of each officer of the Fund is 200 Park Avenue, New York,
New York 10166.
Board members and officers of the Fund, as a group, owned less than 1%
of the Fund's shares outstanding on April 1, 1996.
MANAGEMENT AGREEMENT
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Management
of the Fund."
The Manager provides management services pursuant to the Management
Agreement (the "Agreement") dated August 24, 1994 with the Fund, which 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 was approved by shareholders on August 3, 1994, and was last
approved by the Fund's Board, including a majority of the Board members who
are not "interested persons" (as defined in the 1940 Act) of any party to
the Agreement, at a meeting held on July 17, 1995. 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 voting shares,
or, upon 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:
Howard Stein, Chairman of the Board and Chief Executive Officer; W. Keith
Smith, Vice Chairman of the Board; Christopher M. Condron, President, Chief
Operating Officer and a director; Stephen E. Canter, Vice Chairman, Chief
Investment Officer and a director; Lawrence S. Kash, Vice Chairman--
Distribution and a director; Philip L. Toia, Vice Chairman--Operations and
Administration and a director; William T. Sandalls, Jr., Senior Vice
President and Chief Financial Officer; Barbara E. Casey, Vice President--
Dreyfus Retirement Services; Diane M. Coffey, Vice President--Corporate
Communications; Elie M. Genadry, Vice President--Institutional Sales;
William F. Glavin, Jr., Vice President--Corporate Development; Mark N.
Jacobs, Vice President, General Counsel and Secretary; Mary Beth Leibig,
Vice President--Human Resources; Jeffrey N. Nachman, Vice President--Mutual
Fund Accounting; Andrew S. Wasser, Vice President--Information Systems;
Maurice Bendrihem, Controller; Elvira Oslapas, Assistant Secretary; and
Mandell L. Berman, Frank V. Cahouet, Alvin E. Friedman, Lawrence M. Greene
and Julian M. Smerling, directors.
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 Board to execute
purchases and sales of securities. The Fund's portfolio managers are A.
Paul Disdier, Karen M. Hand, Stephen C. Kris, Richard J. Moynihan, Jill C.
Shaffro, L. Lawrence Troutman, 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. All
purchases and sales are reported for the Board members' review at the
meeting subsequent to such transactions.
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 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: taxes, interest, loan commitment fees,
interest and distributions paid on securities sold short, brokerage fees
and commissions, if any, fees of Board members who are not officers,
directors, employees or holders of 5% or more of the outstanding voting
securities of the Manager, Securities and Exchange Commission fees, state
Blue Sky qualification fees, advisory fees, charges of custodians, transfer
and dividend disbursing agents' fees, certain insurance premiums, industry
association fees, outside auditing and legal expenses, costs of maintaining
corporate existence, costs of independent pricing services, costs
attributable to investor services (including, without limitation, telephone
and personnel expenses), costs of shareholders' reports and corporate
meetings and any extraordinary expenses. Pursuant to the Fund's Service
Plan, the Fund bears expenses for advertising, marketing and distributing
the Fund's shares and servicing shareholder accounts, and also bears the
cost of preparing and printing prospectuses and statements of additional
information and costs associated with implementing and operating such plan.
See "Service Plan."
As compensation for the Manager's services, the Fund has agreed to pay
the Manager a monthly management fee at the annual rate of .60 of 1% of the
value of the Fund's average daily net assets. The management fees payable
for the fiscal years ended December 31, 1993, 1994 and 1995 amounted to
$4,137,876, $3,715,934 and $3,708,451, respectively. The fee for fiscal
year 1995 was reduced by $907,858 pursuant to undertakings by the Manager,
resulting in a net fee paid of $2,800,593 in 1995.
The Manager has agreed that if in any fiscal year the aggregate
expenses of the Fund, exclusive of taxes, brokerage, interest on borrowings
and (with the prior written consent of the necessary state securities
commissions) extraordinary expenses, but including the management fee,
exceed 1 1/2% of the value of the Fund's average net assets for the fiscal
year, the Fund may deduct from the payment to be made to the Manager under
the Agreement, or the Manager will bear, such excess expense. Such
deduction or payment, if any, will be estimated daily, and reconciled and
effected or paid, as the case may be, on a monthly basis.
The aggregate of the fees payable to the Manager is not subject to
reduction as the value of the Fund's net assets increases.
PURCHASE OF SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Shares."
The Distributor. The Distributor serves as the Fund's distributor on
a best efforts basis pursuant to an agreement dated August 24, 1994. The
Distributor also acts as distributor for the other funds in the Dreyfus
Family of Funds and for certain other investment companies. In some
states, certain financial institutions effecting transactions in Fund
shares may be required to register as dealers pursuant to state law.
Dreyfus TeleTransfer Privilege. Dreyfus TeleTransfer purchase orders
may be made at any time. Purchase orders received by 4:00 P.M., New York
time, on any business day that Dreyfus Transfer, Inc., the Fund's transfer
and dividend disbursing agent (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 business 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 Fund 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
"Redemption of Shares--Dreyfus TeleTransfer Privilege."
Reopening an Account. An investor may reopen an account with a
minimum investment of $100 without filing a new Account Application during
the calendar year the account is closed or during the following calendar
year, provided the information on the old Account Application is still
applicable.
SERVICE PLAN
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Service
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 "Plan"), pursuant to which the Fund (a)
reimburses the Distributor for payments to certain financial institutions
(which may include banks), securities dealers and other financial industry
professionals (collectively, "Service Agents") for distributing the Fund's
shares and for servicing shareholder accounts ("Servicing") and (b) pays
the Manager and Dreyfus Service Corporation and any affiliate of either of
them (collectively, "Dreyfus") for advertising and marketing relating to
the Fund and Servicing. The Fund's Board believes that there is a
reasonable likelihood that the Plan will benefit the Fund and its
shareholders.
A quarterly report of the amounts expended under the Plan, and the
purposes for which such expenditures were incurred, must be made to the
Fund's Board for its review. In addition, the Plan provides that it may
not be amended to increase materially the costs which the Fund may bear for
distribution pursuant to the Plan without shareholder approval and that
other material amendments of the 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 or the Manager and have no direct or indirect
financial interest in the operation of the Plan or in the related service
agreements, by vote cast in person at a meeting called for the purpose of
considering such amendments. The Plan and the related service agreements
are subject to annual approval by such vote of the Board members cast in
person at a meeting called for the purpose of voting on the Plan. The Plan
was approved by shareholders on August 3, 1994 and was last approved by the
Fund's Board at a meeting held on July 17, 1995. The Plan may be
terminated at any time by vote of the holders 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 Plan or in any of the related
service agreements or by vote of a majority of the Fund's shares. Any
service agreement may be terminated without penalty, at any time, by such
vote of the Board members or, upon not more than 60 days' written notice to
the Service Agent, by vote of the holders of a majority of the Fund's
shares, or, upon 15 days' notice, by the Distributor. Each service
agreement will terminate automatically in the event of its assignment (as
defined in the 1940 Act).
For the fiscal year ended December 31, 1995, the Fund paid $1,556,807
pursuant to the Plan, of which $50,530 was reimbursed to the Distributor
for payments made to Service Agents for distributing shares and Servicing,
(b) $1,494,658 was payable to Dreyfus for advertising and marketing shares
and Servicing and (c) $11,619 was payable for printing the Fund's
prospectuses and statement of additional information, as well as
implementing and operating the Plan.
REDEMPTION OF SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to
Redeem Shares."
Check Redemption Privilege. An investor may indicate on the Account
Application, Shareholder Services Form or by later written request that the
Fund provide Redemption Checks ("Checks") drawn on the investor's Fund
account. Checks will be sent only to the registered owner(s) of the
account and only to the address of record. The Account Application or
later written request must be manually signed by the registered owner(s).
Checks may be made payable to the order of any person in an amount of $500
or more. When a Check is presented to the Transfer Agent for payment, the
Transfer Agent, as the investor's agent, will cause the Fund to redeem a
sufficient number of full and fractional shares in the investor's account
to cover the amount of the Check. Dividends are earned until the Check
clears. After clearance, a copy of the Check will be returned to the
investor. Investors generally will be subject to the same rules and
regulations that apply to checking accounts, although election of this
Privilege creates only a shareholder-transfer agent relationship with the
Transfer Agent.
If the amount of the Check is greater than the value of the shares in
an investor's account, the Check will be returned marked insufficient
funds. Checks should not be used to close an account.
Wire Redemption Privilege. By using this Privilege, the investor
authorizes the Transfer Agent to act on wire or telephone redemption
instructions from any person representing himself or herself to be the
investor, or a representative of the investor's Service Agent acting on the
investor's behalf, and reasonably believed by the Transfer Agent to be
genuine. Ordinarily, the Fund will initiate payment for shares redeemed
pursuant to this Privilege on the next business day after receipt by the
Transfer Agent of a redemption request in proper form. Redemption proceeds
($1,000 minimum) will be transferred by Federal Reserve wire only to the
commercial bank account specified by the investor on the Account
Application or Shareholder Services Form, or to a correspondent bank if the
investor's bank is not a member of the Federal Reserve System. Fees
ordinarily are imposed by such bank and usually borne by the investor.
Immediate notification by the correspondent bank to the investor's bank is
necessary to avoid a delay in crediting the funds to the investor's bank
account.
Investors with access to telegraphic equipment may wire redemption
requests to the Transfer Agent by employing the following transmittal code
which may be used for domestic or overseas transmissions:
Transfer Agent's
Transmittal Code Answer Back Sign
144295 144295 TSSG PREP
Investors who do not have direct access to telegraphic equipment may
have the wire transmitted by contacting a TRT Cables operator at
1-800-654-7171, toll free. Investors should advise the operator that the
above transmittal code must be used and should also inform the operator of
the Transfer Agent's answer back sign.
To change the commercial bank or account designated to receive
redemption proceeds, a written request must be sent to the Transfer Agent.
This request must be signed by each shareholder, with each signature
guaranteed as described below under "Stock Certificates; Signatures."
Dreyfus TeleTransfer Privilege. Investors should be aware that if
they have also selected the Dreyfus TeleTransfer Privilege, any request
for a wire redemption will be effected as a Dreyfus TeleTransfer
transaction through the Automated Clearing House ("ACH") system unless more
prompt transmittal specifically is requested. Redemption proceeds will be
on deposit in the investor's account at an ACH member bank ordinarily two
business days after receipt of the redemption request. See "Purchase of
Shares--Dreyfus TeleTransfer Privilege."
Stock Certificates; Signatures. Any certificates representing Fund
shares to be redeemed must be submitted with the redemption request.
Written redemption requests must be signed by each shareholder, including
each holder of a joint account, and each signature must be guaranteed.
Signatures on endorsed certificates submitted for redemption also must be
guaranteed. The Transfer Agent has adopted standards and procedures
pursuant to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations, as well as from participants in the New York
Stock Exchange Medallion Signature Program, the Securities Transfer Agents
Medallion Signature Program ("STAMP") and the Stock Exchanges Medallion
Program. Guarantees must be signed by an authorized signatory of the
guarantor and "Signature-Guaranteed" must appear with the signature. The
Transfer Agent may request additional documentation from corporations,
executors, administrators, trustees or guardians and may accept other
suitable verification arrangements from foreign investors, such as consular
verification. For more information with respect to signature-guarantees,
please call one of the telephone numbers listed on the cover.
Redemption Commitment. 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 (which may include non-marketable securities) or other
assets in case of an emergency or any time a cash distribution would impair
the liquidity of the Fund to the detriment of the existing shareholders.
In such event, the securities would be valued in the same manner as the
Fund's portfolio is valued. If the recipient sold such securities,
brokerage charges would 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
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Shareholder
Services."
Fund Exchanges. Shares of other funds purchased by exchange will be
purchased on the basis of relative net asset value per share as follows:
A. Exchanges for shares of funds that are offered without a sales
load will be made without a sales load.
B. Shares of funds purchased without a sales load may be exchanged
for shares of other funds sold with a sales load, and the
applicable sales load will be deducted.
C. Shares of funds purchased with a sales load may be exchanged
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"), provided that, if the sales load applicable
to the Offered Shares exceeds the maximum sales load that could
have been imposed in connection with the Purchased Shares (at the
time the Purchased Shares were acquired), without giving effect
to any reduced loads, the difference will be deducted.
To accomplish an exchange under item D above, shareholders must notify
the Transfer Agent of their prior ownership of fund shares and their
account number.
To request an exchange, an investor, or the investor's Service Agent
acting on his behalf, must give exchange instructions to the Transfer Agent
in writing or by telephone. The ability to issue exchange instructions by
telephone is given to all Fund shareholders automatically, unless the
investor checks the applicable "No" box on the Account Application,
indicating that the investor specifically refuses this Privilege. By using
the Telephone Exchange Privilege, the investor authorizes the Transfer
Agent to act on telephonic instructions from any person representing
himself or herself to be the investor or a representative of the investor's
Service Agent, and reasonably believed by the Transfer Agent to be genuine.
Telephone exchanges may be subject to limitations as to the amount involved
or the number of telephone exchanges permitted. Shares issued in certifi-
cate form are not eligible for telephone exchange.
To establish a personal retirement plan by exchange, shares of the
fund being exchanged must have a value of at least the minimum initial
investment required for the fund into which the exchange is being made.
For Dreyfus-sponsored Keogh Plans, IRAs and IRAs set up under a Simplified
Employee Pension Plan ("SEP-IRAs") with only one participant, the minimum
initial investment is $750. To exchange shares held in corporate plans,
403(b)(7) Plans and SEP-IRAs with more than one participant, the minimum
initial investment is $100 if the plan has at least $2,500 invested among
the funds in the Dreyfus Family of Funds. To exchange shares held in
personal retirement plans, the shares exchanged must have a current value
of at least $100.
Dreyfus Auto-Exchange Privilege. Dreyfus Auto-Exchange Privilege
permits an investor to purchase, in exchange for shares of the Fund, shares
of another fund in the Dreyfus Family of Funds. This Privilege is
available only for existing accounts. Shares will be exchanged on the
basis of relative net asset value as described above under "Fund
Exchanges." Enrollment in or modification or cancellation of this
Privilege is effective three business days following notification by the
investor. An investor will be notified if his account falls below the
amount designated to be exchanged under this Privilege. In this case, an
investor's account will fall to zero unless additional investments are made
in excess of the designated amount prior to the next Auto-Exchange
transaction. Shares held under IRA and other retirement plans are eligible
for this Privilege. Exchanges of IRA shares may be made between IRA
accounts and from regular accounts to IRA accounts, but not from IRA
accounts to regular accounts. With respect to all other retirement
accounts, exchanges may be made only among those accounts.
Fund Exchanges and the Dreyfus Auto-Exchange Privilege are available
to shareholders resident in any state in which shares of the fund being
acquired may legally be sold. Shares may be exchanged only between
accounts having identical names and other identifying designations.
Shareholder Services Forms and prospectuses of the other funds may be
obtained by calling 1-800-645-6561. The Fund reserves the right to reject
any exchange request in whole or in part. Fund Exchanges or the Dreyfus
Auto Exchange Privilege may be modified or terminated at any time upon
notice to shareholders.
Automatic Withdrawal Plan. The Automatic Withdrawal Plan permits an
investor with a $5,000 minimum account to request withdrawal of a specified
dollar amount (minimum of $50) on either a monthly or quarterly basis.
Withdrawal payments are the proceeds from sales of Fund shares, not the
yield on the shares. If withdrawal payments exceed reinvested dividends
and distributions, the investor's shares will be reduced and eventually may
be depleted. Automatic Withdrawal may be terminated at any time by the
investor, the Fund or the Transfer Agent. Shares for which certificates
have been issued may not be redeemed through the Automatic Withdrawal Plan.
Dreyfus Dividend Sweep. Dreyfus Dividend Sweep allows investors to
invest on the payment date their dividends or dividends and capital gain
distributions, if any, from the Fund in shares of another fund in the
Dreyfus Family of Funds of which the investor is a shareholder. Shares of
other funds purchased pursuant to this privilege will be purchased on the
basis of relative net asset value per share as follows:
A. Dividends and distributions paid by a fund may be invested
without imposition of a sales load in shares of other funds that
are offered without a sales load.
B. Dividends and distributions paid by a fund which does not charge
a sales load may be invested in shares of other funds sold with a
sales load, and the applicable sales load will be deducted.
C. Dividends and distributions paid by a fund which charges a sales
load may be invested in shares of other funds sold with a sales
load (referred to herein as "Offered Shares"), provided that, if
the sales load applicable to the Offered Shares exceeds the
maximum sales load charged by the fund from which dividends or
distributions are being swept, without giving effect to any
reduced loads, the difference will be deducted.
D. Dividends and distributions paid by a fund may be invested in
shares of other funds that impose a contingent deferred sales
charge ("CDSC") and the applicable CDSC, if any, will be imposed
upon redemption of such shares.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Shares."
Valuation of Portfolio Securities. The Fund's investments are valued
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 Service Plan, are
accrued daily and are taken into account for the purpose of determining the
net asset value of Fund shares.
New York Stock Exchange Closings. The holidays (as observed) on which
the New York Stock Exchange is closed currently are: New Year's Day,
Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor Day,
Thanksgiving and Christmas.
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.
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 opinion of the Manager that the
receipt and study of such services should not reduce the overall expenses
of its research department.
DIVIDENDS, DISTRIBUTIONS AND TAXES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Dividends,
Distributions and Taxes."
The Internal Revenue Code of 1986, as amended (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. In
addition, any dividend or distribution paid shortly after an investor's
purchase may have the effect of reducing the 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 "Dividends,
Distributions and Taxes" in the Prospectus.
Ordinarily, gains and losses realized from portfolio transactions will
be treated as capital gain or loss. However, all or a portion of any gains
realized from the sale or other disposition of certain market discount
bonds will be treated as ordinary income under Section 1276 of the Code.
Investment by the Fund in securities issued 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. 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.
PERFORMANCE INFORMATION
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Performance
Information."
The Fund's current yield for the 30-day period ended December 31, 1995
was 4.65%, which reflects the waiver of a portion of the management fee.
See "Management of the Fund" in the Prospectus. Had a portion of the
management fee not been waived, the Fund's current yield for the same
period would have been 4.51%. 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 net asset value per share on the last day of the period less any
undistributed earned income per share reasonably expected to be declared as
a dividend shortly thereafter. The quotient is then added to 1, and that
sum is raised to the 6th power, after which 1 is subtracted. The current
yield is then arrived at by multiplying the result by 2.
Based upon a combined 1996 Federal and State of New Jersey personal
income tax rate of 43.45%, the Fund's tax equivalent yield for the 30-day
period ended December 31, 1995 was 8.22%, which reflects the waiver of a
portion of the management fee. See "Management of the Fund" in the
Prospectus. Had a portion of the management fee not been waived, the
Fund's tax equivalent yield for the same period would have been 7.98%. 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 New Jersey State marginal personal income tax rates
presently in effect. For Federal income tax purposes, a 39.60% tax rate
has been used. For New Jersey income tax purposes, a 6.65% tax rate has
been used. The tax equivalent yield figure, however, does not include 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 Fund's average annual total return for the 1, 5 and 8.153 year
periods ended December 31, 1995 was 15.29%, 8.29% and 9.01%, respectively.
Average annual total return is calculated by determining the ending
redeemable value of an investment purchased with a hypothetical $1,000
payment made at the beginning of the period (assuming the reinvestment of
dividends and distributions), dividing by the amount of the initial
investment, taking the "n"th root of the quotient (where "n" is the number
of years in the period) and subtracting 1 from the result.
The Fund's total return for the period November 6, 1987 to December
31, 1995 was 102.1 2%. Total return is calculat ed by subtracting the
amount of the Fund's net asset value per share at the beginnin g of a stated
period from the net asset value per share at the end of the period (after giving
effect to the reinvest ment of dividend s and distribu tions during the period),
and dividing the result by the net asset value per share at the beginning of
the period.
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 are not representative of the
Fund's past or future performance.
From time to time, the Fund may use hypothetical equivalent yields or
charts in its advertising. These hypothetical yields or charts will be
used for illustrative purposes only and not as representative of the Fund's
past or future performance. Advertising materials for the Fund also may
refer to or discuss then-current or past economic conditions, developments
and/or events, and actual or proposed tax legislation. Advertising
materials for the Fund may also refer to statistical or other information
concerning trends relating to investment companies, as compiled by industry
associations such as the Investment Company Institute, and may refer to
Morningstar ratings and related analyses supporting the rating. In
addition, advertising material for the Fund may include biographical
information relating to its portfolio managers and may refer to, or include
commentary by a portfolio manager relating to investment strategy, asset
growth, current or past business, political, economic or financial
conditions and other matters of general interest to investors.
INFORMATION ABOUT THE FUND
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "General
Information."
Each Fund share has one vote and, when issued and paid for in
accordance with the terms of the offering, is fully paid and nonassessable.
Fund shares are of one class and have equal rights as to dividends and in
liquidation. Shares have no preemptive, subscription or conversion rights
and are freely transferable.
The Fund sends annual and semi-annual financial statements to all its
shareholders.
TRANSFER AND DIVIDEND DISBURSING AGENT, CUSTODIAN,
COUNSEL AND INDEPENDENT AUDITORS
Dreyfus Transfer, Inc., a wholly-owned subsidiary of the Manager, P.O.
Box 9671, Providence, Rhode Island 02940-9671, is 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, 90 Washington
Street, New York, New York 10286, is the Fund's custodian. Neither the
Transfer Agent nor The Bank of New York has any part in determining the
investment policies of the Fund or which portfolio securities are to be
purchased or sold by the Fund.
Stroock & Stroock & Lavan, 7 Hanover Square, New York, New York
10004-2696, 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 auditors of the Fund.
APPENDIX A
RISK FACTORS -- INVESTING IN NEW JERSEY MUNICIPAL OBLIGATIONS.
The following information constitutes only a brief summary, does not
purport to be a complete description, and is based on information drawn
from official statements relating to securities offerings of the State of
New Jersey and various local agencies available as of the date of this
Statement of Additional Information. 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.
New Jersey's economic base is diversified, consisting of a variety of
manufacturing, construction and service industries, supplemented by rural
areas with selective commercial agriculture. New Jersey's principal
manufacturing industries produce chemicals, pharmaceutical, electrical
equipment and instruments, machinery, printing and food products. Other
economic activities include services, wholesale and retail trade,
insurance, tourism, petroleum refining and truck farming.
While New Jersey's economy continued to expand during the late 1980s,
the level of growth slowed considerably after 1987. By the beginning of
the national recession in July 1990 (according to the National Bureau of
Economic Research), construction activity had already been declining in New
Jersey for nearly two years, growth had tapered off markedly in the service
sectors and the long-term downward trend of factory employment had
accelerated, partly because of a leveling off of industrial demand
nationally. The onset of recession caused an acceleration of New Jersey's
job losses in construction and manufacturing, as well as an employment
downturn in such previously growing sectors as wholesale trade, retail
trade, finance, utilities and trucking and warehousing. The net effect was
a decline in the State's total nonfarm wage and salary employment from a
peak of 3,689,800 in 1989 to a low of 3,445,000 in 1992. This loss has
been followed by an employment gain of 176,400 from May 1992 to October
1995, a recovery of 67% of the jobs lost during the recession. In July
1991, S&P lowered the State's general obligation bond rating from AAA to
AA+.
Reflecting the downturn, the rate of unemployment in the State rose
from a low of 3.6% during the first quarter of 1989 to a recessionary peak
of 8.4% during 1992. Since then, the unemployment rate fell to 6.4% during
the first ten months 1995. Despite an increase reported in December 1995,
the annualized unemployment rate remained 6.4% for the fourth quarter of
1995.
The revised estimate as shown in the Governor's Fiscal Year 1997
Budget Message forecasts Sales and Use Tax collections for Fiscal Year 1996
as $4.310 billion, a 4.3% increase from Fiscal Year 1995 revenue. The
Fiscal Year 1997 estimate of $4.403 billion, is a 2.2% increase from the
Fiscal Year 1996 estimate.
The revised estimate as shown in the Governor's Fiscal Year 1997
Budget Message forecasts Gross Income Tax collections for Fiscal Year 1996
of $4.547 billion, a 0.2% increase from Fiscal Year 1995 revenue. Included
in the Fiscal Year 1995 revenue is a 5% reduction of personal income tax
rates effective January 1, 1994 and a further 10% reduction of personal
income tax rates effective January 1, 1995 (on joint income under $80,000).
The estimate for fiscal year 1997 as shown in the Governor's Fiscal Year
1997 Budget Message of $4.610 billion, is a 1.4% increase from the Fiscal
Year 1996 estimate. Included in the Fiscal Year 1996 forecast is the 10%
reduction of personal income tax rates effective January 1, 1995 and a
further 15% reduction of personal income tax rates effective January 1,
1996 (on joint incomes under $80,000).
The revised estimate as shown in the Governor's Fiscal Year 1997
Budget Message forecasts Corporation Business Tax collections for Fiscal
Year 1996 of $1.198 billion, a 10.4% increase from Fiscal Year 1995
revenue. Included in the Corporation Business Tax forecast is a reduction
in the Corporation Business Tax rate from 9.375% to 9.0% of net New Jersey
income. The Fiscal Year 1997 forecast as shown in the Governor's Fiscal
1997 Budget Message of $1.210 billion, represents a 1.0% increase from the
Fiscal Year 1996 estimate.
The revised estimate as shown in the Governor's Fiscal Year 1997
Budget Message forecasts Other Miscellaneous Taxes Fees and Revenues
collections for Fiscal Year 1996 as $1.514 billion, a decrease from fiscal
year 1995 revenue.
The Fiscal Year 1996 revised estimates anticipate that the Legislature
will enact a Tax Amnesty program. It is estimated that a 90-day tax
amnesty will yield $70 million.
Should revenues be less than the amount anticipated in the budget for
a fiscal year, the Governor may, pursuant to statutory authority, prevent
any expenditure under any appropriation. There are additional means by
which the Governor may ensure that the State is operated efficiently and
does not incur a deficit. No supplemental appropriation may be enacted
after adoption of an appropriations act except where there are sufficient
revenues on hand or anticipated, as certified by the Governor, to meet such
appropriation. In the past when actual revenues have been less than the
amount anticipated in the budget, the Governor has exercised her plenary
powers leading to, among other actions, implementation of a hiring freeze
for all State departments and the discontinuation of programs for which
appropriations were budgeted but not yet spent.
The State appropriated approximately $15.439 billion and $16.109
billion for Fiscal 1995 and 1996, respectively. Of the $16.109 billion
appropriated in Fiscal Year 1996 from the General Fund, the Property Tax
Relief Fund, the Casino Control Fund, the Casino Revenue Fund and
Gubernatorial Elections Fund, $6.447 billion (40.0%) is appropriated for
State aid to local governments, $3.746 billion (23.3%) is appropriated for
grants-in-aid (payments to individuals or public or private agencies for
benefits to which a recipient is entitled by law or for the provision of
service on behalf of the State), $5.233 billion (32.5%) for Direct State
services, $466.3 million (2.9%) for debt service on State general
obligation bonds and $217.1 million (1.3%) for capital construction.
Should tax revenues be less than the amount anticipated in the Budget
for a fiscal year, the Governor may, pursuant to statutory authority,
prevent any expenditure under any appropriation. The appropriations for
Fiscal Year 1996 and for Fiscal Year 1997 reflect the amounts contained in
the Governor's Fiscal Year 1997 Budget Message.
The State has made appropriations for principal and interest payments
for general obligation bonds for fiscal years 1993 through 1996 in the
amounts of $444.3 million, $119.9 million, $103.6 million and $466.3
million, respectively. The Governor's Fiscal Year 1997 Budget Message for
Fiscal Year 1997 includes an appropriation in the amount of $463.1 million
for principal and interest payments for general obligation bonds.
APPENDIX B
Description of S&P's, 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 and 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 interest and repayment 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
An S&P commercial paper rating is a current assessment of the
likelihood of timely payment of debt having an original maturity of no more
than 365 days.
A
Issues assigned an A rating are regarded as having the greatest
capacity for timely payment. Issues in this category are delineated with
the numbers 1, 2 and 3 to indicate the relative degree of safety.
A-1
This designation indicates 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 (+)
designation.
A-2
Capacity for timely payment on issues with this designation is strong.
However, the relative degree of safety is not as high as for issues
designated A-1.
Moody's
Municipal Bond Ratings
Aaa
Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to
as "gilt edge." Interest payments are protected by a large or by an
exceptionally stable margin and principal is secure. While the various
protective elements are likely to change, such changes as can be visualized
are most unlikely to impair the fundamentally strong position of such
issues.
Aa
Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group they comprise what 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 which are rated A possess many favorable investment attributes
and are to be considered as upper medium grade obligations. Factors giving
security to principal and interest are considered adequate, but elements
may be present which suggest a susceptibility to impairment sometime in the
future.
Baa
Bonds which are rated Baa are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest
payments and principal security appear adequate for the present but certain
protective elements may be lacking or may be characteristically unreliable
over any great length of time. Such bonds lack outstanding investment
characteristics and in fact have speculative characteristics as well.
Ba
Bonds which are rated Ba are judged to have speculative elements;
their future cannot be considered as well assured. Often the protection of
interest and principal payments may be very moderate, and therefore not
well safeguarded during both good and bad times over the future.
Uncertainty of position characterizes bonds in this class.
B
Bonds which are rated B generally lack characteristics of the
desirable investment. Assurance of interest and principal payments or of
maintenance of other terms of the contract over any long period of time may
be small.
Caa
Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to
principal or interest.
Ca
Bonds which are rated Ca present obligations which are speculative in
a high degree. Such issues are often in default or have other marked
shortcomings.
C
Bonds which are rated C are the lowest rated class of bonds, and
issues so rated can be regarded as having extremely poor prospects of ever
attaining any real investment standing.
Moody's applies the numerical modifiers 1, 2 and 3 to show relative
standing within the major rating categories, except in the Aaa category and
in the categories below B. The modifier 1 indicates a 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 and municipal notes and other short-term
loans are designated Moody's Investment Grade (MIG). Such ratings
recognize the difference 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.
MIG 3/VMIG 3
This designation denotes favorable quality. All security elements are
accounted for but there is lacking the undeniable strength of the preceding
grades. Liquidity and cash flow protection may be narrow and market access
for refinancing is likely to be less well established.
MIG 4/VMIG 4
This designation denotes adequate quality. Protection commonly
regarded as required of an investment security is present and although not
distinctly or predominantly speculative, there is specific risk.
Commercial Paper Ratings
The rating Prime-1 (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of P-1 paper must have a superior capacity
for repayment of short-term promissory obligations, and ordinarily will be
evidenced by leading market positions in well established industries, high
rates of return on funds employed, conservative capitalization structures
with moderate reliance on debt and ample asset protection, broad margins in
earnings coverage of fixed financial charges and high internal cash
generation, and well established access to a range of financial markets and
assured sources of alternate liquidity.
Issuers (or related supporting institutions) rated Prime-2 (P-2) have
a strong capacity for repayment of short-term promissory obligations. This
ordinarily will be evidenced by many of the characteristics cited above but
to a lesser degree. Earnings trends and coverage ratios, while sound, will
be more subject to variation. Capitalization characteristics, while still
appropriate, may be more affected by external conditions. Ample alternate
liquidity is maintained.
Fitch
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
reasonable foreseeable events.
AA
Bonds rated AA are considered to be investment grade and of very high
credit quality. The obligor's ability to pay interest and repay principal
is very strong, although not quite as strong as bonds rated AAA. Because
bonds rated in the AAA and AA categories are not significantly vulnerable
to foreseeable future developments, short-term debt of these issuers is
generally rated F-1+.
A
Bonds rated A are considered to be investment grade and of high credit
quality. The obligor's ability to pay interest and repay principal is
considered to be strong, but may be more vulnerable to adverse changes in
economic conditions and circumstances than bonds with higher ratings.
BBB
Bonds rated BBB are considered to be investment grade and of
satisfactory credit quality. The obligor's ability to pay interest and
repay principal is considered to be adequate. Adverse changes in economic
conditions and circumstances, however, are more likely to have an adverse
impact on these bonds and, therefore, impair timely payment. The
likelihood that the ratings of these bonds will fall below investment grade
is higher than for bonds with higher ratings.
BB
Bonds rated BB are considered speculative. The obligor's ability to
pay interest and repay principal may be affected over time by adverse
economic changes. However, business and financial alternatives can be
identified which could assist the obligor in satisfying its debt service
requirements.
B
Bonds rated B are considered highly speculative. While bonds in this
class are currently meeting debt service requirements, the profitability 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 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 lowest
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 13-36
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.
<TABLE>
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS DECEMBER 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS-99.9% AMOUNT VALUE
_______ _______
<S> <C> <C>
NEW JERSEY-83.1%
Atlantic County Utilities Authority, Solid Waste System Revenue:
7%, 3/1/2008............................................................ $ 4,250,000 $ 4,426,247
7.125%, 3/1/2016........................................................ 6,650,000 6,935,085
Bedminster Township Board of Education, COP 7.125%, 9/1/2010................ 2,500,000 2,811,525
Bergen County Utilities Authority, Water Pollution Control System Revenue
5.50%, 12/15/2015 (Insured; FGIC)....................................... 5,000,000 5,012,000
Bordentown Sewer Authority, Revenue 6.80%, 12/1/2025 (Insured; MBIA)........ 3,000,000 3,339,090
City of Camden:
Zero Coupon, 2/15/2010 (Insured; FSA)................................... 2,500,000 1,203,850
Zero Coupon, 2/15/2012 (Insured; FSA)................................... 4,585,000 1,959,858
Camden County Municipal Utilities Authority, Sewer Revenue
8.25%, 12/1/2017 (Insured; FGIC)........................................ 6,000,000 6,570,540
Camden County Pollution Control Financing Authority, Solid Waste Disposal and
Resource Recovery System Revenue 7.50%, 12/1/2010....................... 13,000,000 13,725,790
Delaware River Port Authority, Revenue 5.50%, 1/1/2026 (Insured; FGIC)...... 13,020,000 13,128,196
East Orange:
Zero Coupon, 8/1/2010 (Insured; FSA).................................... 4,240,000 1,993,606
Zero Coupon, 8/1/2011 (Insured; FSA).................................... 2,500,000 1,107,775
Elk Township Board of Education, COP 7.375%, 12/1/2009 (Insured; MBIA)...... 2,000,000 2,207,960
Essex County Improvement Authority, Lease Revenue
7%, 12/1/2020 (Prerefunded 12/1/2000) (Insured; AMBAC) (a).............. 4,000,000 4,568,000
Evesham Township Board of Education, COP, Lease Purchase Agreement
6.875%, 9/1/2011 (Insured; FGIC)........................................ 3,050,000 3,440,674
Gloucester Township Municipal Utilities Authority, Revenue
5.65%, 3/1/2018 (Insured; AMBAC)........................................ 2,530,000 2,683,748
Howell Township, Refunding 6.80%, 1/1/2014 (Insured; FGIC).................. 5,000,000 5,601,350
Hudson County Improvement Authority:
Facility Lease Revenue 7.671%, 12/1/2025 (Insured; FGIC) (b,c).......... 13,835,000 14,855,331
MFHR (Conduit Financing - Observer Park Project)
6.90%, 6/1/2022 (Insured; FNMA)....................................... 4,190,000 4,430,548
Jersey City, Zero Coupon, 5/15/2010 (Insured; FSA).......................... 4,745,000 2,255,536
Keansburg Board of Education, COP 8%, 11/1/2014 (Prerefunded 11/1/1999) (a). 7,750,000 8,930,557
Manchester Township Board of Education, COP
7.20%, 12/15/2009 (Prerefunded 12/15/1998) (Insured; MBIA) (a).......... 4,175,000 4,624,940
Mercer County Improvement Authority, Revenue, Refunding Insured Solid Waste
(Resource Recovery Project) 6.70%, 4/1/2013 (Insured; FGIC)............. 11,000,000 11,600,380
Monmouth County Improvement Authority, Revenue (Asbury Park Project)
7.375%, 12/1/2009 (Prerefunded 12/1/1999) (a)........................... 3,000,000 3,391,980
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) DECEMBER 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
_______ _______
NEW JERSEY (CONTINUED)
Monroe Township Municipal Utilities Authority, Water and Sewer System Revenue
6.875%, 2/1/2017 (Insured; MBIA)........................................ $ 5,000,000 $ 5,565,450
Borough of Moonachie Board of Education, COP
6.375%, 3/1/2014 (Lease Purchase Agreement; Lamington Funding Corp.).... 3,775,000 3,898,895
New Brunswick Parking Authority, Revenue, Refunding
7.125%, 9/1/2015 (Prerefunded 9/1/1999) (Insured; FGIC) (a)............. 2,000,000 2,233,640
New Jersey Economic Development Authority, Revenue:
(Community Mental Health Loan Program) 8.50%, 7/1/2017.................. 7,485,000 8,153,710
District Heating and Cooling Revenue
(Trigen - Trenton District Energy Co. L.P. Project):
6.10%, 12/1/2004.................................................. 3,375,000 3,692,824
6.20%, 12/1/2007.................................................. 2,725,000 2,923,080
Economic Development:
(American Airlines Inc. Project) 7.10%, 11/1/2031..................... 2,855,000 3,086,055
Refunding:
(Manchester Manor Project) 6.70%, 8/1/2022 (Insured; GNMA)........ 2,500,000 2,662,600
(Stolt Terminals Inc. Project) 10.50%, 1/15/2018.................. 9,440,000 10,734,602
(Tevco Inc. Project) 8.125%, 10/1/2009 (LOC; Credit Lyonnais) (d). 2,500,000 2,728,000
First Mortgage (The Evergreens) 9.25%, 10/1/2022........................ 5,000,000 5,525,350
Waste Paper Recycling (Marcal Paper Mills Inc. Project):
6.25%, 2/1/2009....................................................... 6,605,000 6,862,265
8.50%, 2/1/2010....................................................... 5,850,000 6,759,207
Water Facilities:
(American Water Co. Inc. Project) 6.50%, 4/1/2022 (Insured; FGIC)..... 32,800,000 35,828,752
(Elizabeth Water Co. Project):
6.60%, 8/1/2021................................................... 6,010,000 6,308,937
6.70%, 8/1/2021................................................... 3,965,000 4,176,335
(Hackensack Water Project):
5.80%, 3/1/2024 (Insured; MBIA)................................... 2,000,000 2,064,180
Refunding 5.90%, 3/1/2024 (Insured; MBIA)......................... 4,000,000 4,115,160
New Jersey Educational Facilities Authority, Revenue:
(New Jersey Institute of Technology)
6.90%, 7/1/2009 (Prerefunded 7/1/1999) (Insured; MBIA) (a)............ 2,000,000 2,219,300
(Seton Hall University Project):
6.85%, 7/1/2019 (Insured; BIGI)....................................... 9,050,000 9,966,584
7%, 7/1/2021.......................................................... 3,500,000 3,864,315
(Trenton State College)
7.125%, 7/1/2009 (Prerefunded 7/1/1999) (Insured; AMBAC) (a).......... 4,000,000 4,467,720
(Union County College) 7.25%, 7/1/2009.................................. 2,100,000 2,318,757
New Jersey Health Care Facilities Financing Authority, Revenue:
(Bridgeton and Millville Hospitals) 8%, 7/1/2013 (Insured; MBIA)....... 645,000 713,441
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) DECEMBER 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
_______ _______
NEW JERSEY (CONTINUED)
New Jersey Health Care Facilities Financing Authority, Revenue (continued):
(Deborah Heart and Lung Center Issue) 6.30%, 7/1/2023................... $ 2,700,000 $ 2,799,576
Health System (Franciscan Sisters of the Poor - Health Systems, Inc.,
Saint Mary's Hospital) 5.875%, 7/1/2012 (Insured; MBIA)............... 3,250,000 3,154,872
(Hunterdon Medical Center) 7%, 7/1/2020 (Insured; AMBAC)................ 5,000,000 5,557,200
(Kennedy Memorial Hospital University Medical Center):
8.375%, 7/1/2010...................................................... 2,065,000 2,439,798
6%, 7/1/2020.......................................................... 4,115,000 4,145,821
(Kimball Medical Center) 8%, 7/1/2013................................... 13,000,000 13,935,480
(Medical Center of Ocean County) 6.75%, 7/1/2020 (Insured; FSA)......... 1,980,000 2,187,761
(Newcomb Medical Center) 7.875%, 7/1/2003............................... 2,795,000 3,068,072
(Palisades Medical Center):
7.50%, 7/1/2006....................................................... 2,300,000 2,380,799
7.60%, 7/1/2021....................................................... 2,350,000 2,403,016
(Princeton Medical Center) 7%, 7/1/2022 (Insured; AMBAC)................ 3,375,000 3,778,954
(Raritan Bay Medical Center) 7.25%, 7/1/2014............................ 13,000,000 13,582,920
(Refunding - Atlantic City Medical Center) 6.80%, 7/1/2011.............. 2,500,000 2,750,550
(Saint Peter's Medical Center)
6%, 7/1/2021 (Prerefunded 7/1/2001) (Insured; MBIA) (a)............... 1,500,000 1,628,415
(Zurbrugg Memorial Hospital) 8.50%, 7/1/2012............................ 3,000,000 3,174,690
New Jersey Housing and Mortgage Finance Agency, Revenue:
Home Buyer 7.70%, 10/1/2029 (Insured; MBIA)............................. 4,780,000 5,026,887
Multi-Family Housing, Refunding (Presidential Plaza at Newport Project)
7%, 5/1/2030 (Insured; FHA)........................................... 5,000,000 5,308,500
Rental Housing 6.75%, 11/1/2022......................................... 9,310,000 9,623,095
New Jersey Transit Corp., Lease Purchase Agreement, COP (Raymond Plaza East
Inc.)
6.50%, 10/1/2016 (Insured; FSA)......................................... 3,945,000 4,433,746
New Jersey Transportation Trust Fund Authority, Refunding (Transportation
System):
6.50%, 6/15/2011 (Insured; MBIA)........................................ 11,000,000 12,759,230
7%, 6/15/2012 (Insured; MBIA)........................................... 6,000,000 7,362,060
New Jersey Turnpike Authority, Turnpike Revenue, Refunding 6.50%, 1/1/2016.. 14,665,000 16,497,832
North Jersey District Water Supply Commission:
(Wanaque North Project) 6%, 11/15/2019 (Insured; MBIA).................. 3,850,000 3,926,192
(Wanaque South Project) 6%, 7/1/2019 (Insured; MBIA).................... 2,000,000 2,224,340
Ocean County Pollution Control Financing Authority, PCR, Refunding
(Ciba Geigy Corp. Project) 6%, 5/1/2020................................. 11,700,000 12,104,469
Passaic County Utilities Authority, Solid Waste System Revenue 7%, 11/15/2007 5,000,000 5,161,500
Port Authority of New York and New Jersey:
(Delta Airlines Inc. Project) 6.95%, 6/1/2008........................... 7,200,000 7,729,992
(Consolidated Board 71st Series) 6.50%, 1/15/2026....................... 4,000,000 4,298,440
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) DECEMBER 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
_______ _______
NEW JERSEY (CONTINUED)
Port Authority of New York and New Jersey (continued):
(Consolidated Board 73rd Series) 6.75%, 4/15/2026....................... $ 9,000,000 $ 9,690,930
(Consolidated Board 89th Series) 5.125%, 10/1/2021...................... 12,000,000 11,648,400
Special Obligation Revenue (Continental-Eastern LaGuardia Project)
9.125%, 12/1/2015..................................................... 6,500,000 7,385,755
Rutgers State University 7%, 5/1/2019 (Prerefunded 5/1/1999) (a)............ 4,525,000 5,016,822
Salem County Improvement Authority, Revenue (County Correctional Facility and
Court House) 7.125%, 5/1/2017 (Prerefunded 5/1/1999) (Insured; AMBAC) (a) 2,000,000 2,225,100
Salem County Industrial Pollution Control Financing Authority, Revenue
Pollution Control (Public Service Electric and Gas Co.):
5.45%, 2/1/2032 (Insured; MBIA)....................................... 5,500,000 5,410,130
5.55%, 11/1/2033 (Insured; MBIA)...................................... 5,180,000 5,185,387
Sayreville Housing Development Corp., Mortgage Revenue, Refunding
(Lakeview Section 8) 7.75%, 8/1/2024 (Insured; FHA)..................... 2,960,000 3,000,049
Southeast Morris County Municipal Utilities Authority, Water Revenue
6.50%, 1/1/2011 (Insured; FGIC)......................................... 1,475,000 1,616,615
University of Medicine and Dentistry 7.20%, 12/1/2019 (Prerefunded 12/1/1999) (a) 5,710,000 6,431,344
West Monmouth Utilities Authority, Revenue, Refunding
5.60%, 2/1/2014 (Insured; AMBAC)........................................ 2,190,000 2,256,116
West New York Municipal Utilities Authority, Sewer Revenue, Refunding
7.30%, 12/15/2017 (Prerefunded 12/15/2000) (Insured; FGIC) (a).......... 6,250,000 7,226,375
West Windsor Plainsboro Regional School District:
5.50%, 12/1/2015 (Insured; FGIC)........................................ 2,700,000 2,777,220
5.50%, 12/1/2016 (Insured; FGIC)........................................ 2,700,000 2,777,220
5.50%, 12/1/2017 (Insured; FGIC)........................................ 2,700,000 2,765,151
5.50%, 12/1/2018 (Insured; FGIC)........................................ 2,700,000 2,765,151
5.50%, 12/1/2019 (Insured; FGIC)........................................ 2,700,000 2,755,539
5.50%, 12/1/2020 (Insured; FGIC)........................................ 2,700,000 2,755,539
U.S. RELATED -16.8%
Guam Power Authority, Revenue 6.30%, 10/1/2022.............................. 3,750,000 3,826,613
Commonwealth of Puerto Rico:
5.50%, 7/1/2013......................................................... 4,500,000 4,482,450
5.65%, 7/1/2015 (Insured; MBIA)......................................... 2,000,000 2,149,080
7.30%, 7/1/2020 (Prerefunded 7/1/2000) (a).............................. 10,850,000 12,450,701
Public Improvement 6.80%, 7/1/2021 (Prerefunded 7/1/2002) (a)........... 4,400,000 5,073,948
Puerto Rico Aqueduct and Sewer Authority, Revenue, Refunding 5%, 7/1/2019... 7,225,000 6,875,021
Puerto Rico Electric Power Authority, Power Revenue, Refunding
5.50%, 7/1/2025......................................................... 6,500,000 6,476,470
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
STATEMENT OF INVESTMENTS (CONTINUED) DECEMBER 31, 1995
PRINCIPAL
LONG-TERM MUNICIPAL INVESTMENTS (CONTINUED) AMOUNT VALUE
_______ _______
U.S. RELATED (CONTINUED)
Puerto Rico Highway and Transportation Authority, Highway Revenue:
6.625%, 7/1/2002........................................................ $ 510,000 $ 583,093
6.232%, 7/1/2007 (b).................................................... 11,100,000 11,377,500
6.20%, 7/1/2009 (b)..................................................... 2,950,000 2,957,375
7.75%, 7/1/2016 (Prerefunded 7/1/2000) (a).............................. 3,460,000 4,033,945
6.625%, Series S, 7/1/2018 (Prerefunded 7/1/2002) (a)................... 9,400,000 10,747,208
6.625%, Series T, 7/1/2018 (Prerefunded 7/1/2002) (a)................... 2,040,000 2,209,463
5%, 7/1/2022............................................................ 2,500,000 2,334,925
Puerto Rico Housing Finance Corp., MFMR
7.50%, 4/1/2022 (LOC; Government Development Bank of Puerto Rico) (d) .. 3,355,000 3,589,347
Puerto Rico Industrial Medical and Environmental Pollution Control Facilities
Financing Authority, Revenue (Baxter Travenol Laboratories) 8%, 9/1/2012 5,000,000 5,516,400
Puerto Rico Urban Renewal and Housing Corp. 7.875%, 10/1/2004............... 2,000,000 2,248,200
University of Puerto Rico, University Revenues
5.25%, 6/1/2025 (Insured; MBIA)......................................... 5,100,000 5,065,728
Virgin Islands, Matching Fund (Hugo Insurance Claims Fund Program)
7.75%, 10/1/2006........................................................ 3,315,000 3,644,809
Virgin Island Public Finance Authority, Revenue, Refunding
(Matching Fund Loan Notes) 7.25%, 10/1/2018 ............................ 4,750,000 5,162,395
Virgin Islands Water and Power Authority, Electric System Revenue 7.40%, 7/1/2011 4,000,000 4,353,400
______
TOTAL LONG-TERM MUNICIPAL INVESTMENTS
(cost $574,618,284)..................................................... $623,964,846
=======
SHORT-TERM MUNICIPAL INVESTMENTS-.1%
New Jersey Economic Development Authority, PCR, VRDN
Refunding (Hoffman LaRoche Project) 5.50% (e)
(cost $800,000)......................................................... $ 800,000 $ 800,000
=======
TOTAL INVESTMENTS-100.0%
(cost $575,418,284)..................................................... $624,764,846
=======
</TABLE>
<TABLE>
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
SUMMARY OF ABBREVIATIONS
<S> <C> <C> <C>
AMBAC American Municipal Bond Assurance Corporation LOC Letter of Credit
BIGI Bond Investors Guaranty Insurance MBIA Municipal Bond Investors Assurance
COP Certificate of Participation Insurance Corporation
FGIC Financial Guaranty Insurance Company MFHR Multi-Family Housing Revenue
FHA Federal Housing Administration MFMR Multi-Family Mortgage Revenue
FNMA Federal National Mortgage Association PCR Pollution Control Revenue
FSA Financial Security Assurance VRDN Variable Rate Demand Notes
GNMA Government National Mortgage Association
</TABLE>
<TABLE>
SUMMARY OF COMBINED RATINGS (UNAUDITED)
FITCH (F) OR MOODY'S OR STANDARD & POOR'S PERCENTAGE OF VALUE
____ ____ __________ ___________
<S> <C> <C> <C>
AAA Aaa AAA 48.6%
AA Aa AA 7.7
A A A 18.9
BBB Baa BBB 10.6
BB Ba BB 2.8
B B B 1.2
F1 Mig1 SP1 .1
Not Rated (g) Not Rated (g) Not Rated (g) 10.1
____
100.0%
====
</TABLE>
NOTES TO STATEMENT OF INVESTMENTS:
(a) Bonds which are prerefunded are collateralized by U.S. Government
securities which are held in escrow and are used to pay principal and
interest on the municipal issue and to retire the bonds in full at the
earliest refunding date.
(b) Inverse floater security - the interest is subject to change
periodically.
(c) Security exempt from registration under Rule 144A of the Securities
Act of 1933. These securities may be resold in transactions exempt from
registration, normally to qualified institutional buyers. At December 31,
1995, this security amounted to $14,855,331 or 2.3% of net assets.
(d) Secured by letter of credit.
(e) Securities payable on demand. The interest rate, which is subject to
change, is based upon bank prime rates or an index of market interest
rates.
(f) Fitch currently provides creditworthiness information for a limited
number of investments.
(g) Securities which, while not rated by Fitch, Moody's or Standard &
Poor's, have been determined by the Manager to be of comparable quality
to those rated securities in which the Fund may invest.
See notes to financial statements.
<TABLE>
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
STATEMENT OF ASSETS AND LIABILITIES DECEMBER 31, 1995
<S> <C> <C>
ASSETS:
Investments in securities, at value
(cost $575,418,284)-see statement..................................... $624,764,846
Cash.................................................................... 17,744,485
Interest receivable..................................................... 11,892,918
Prepaid expenses........................................................ 4,511
______
654,406,760
LIABILITIES:
Due to The Dreyfus Corporation and subsidiaries......................... $369,808
Due to Distributor...................................................... 7,092
Accrued expenses........................................................ 193,557 570,457
____ ______
NET ASSETS ................................................................ $653,836,303
=======
REPRESENTED BY:
Paid-in capital......................................................... $602,014,250
Accumulated undistributed investment income-net......................... 185,970
Accumulated undistributed net realized gain on investments.............. 2,289,521
Accumulated net unrealized appreciation on investments-Note 3........... 49,346,562
______
NET ASSETS at value applicable to 48,331,304 shares outstanding
(500 million shares of $.001 par value Common Stock authorized)......... $653,836,303
=======
NET ASSETS VALUE, offering and redemption price per share
($653,836,303 / 48,331,304 shares)...................................... $13.53
=======
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
STATEMENT OF OPERATIONS YEAR ENDED DECEMBER 31, 1995
<S> <C> <C>
INVESTMENT INCOME:
INTEREST INCOME......................................................... $40,004,004
EXPENSES:
Management fee-Note 2(a).............................................. $ 3,708,451
Shareholder servicing costs-Note 2(b)................................. 1,908,003
Custodian fees........................................................ 73,150
Professional fees..................................................... 54,524
Prospectus and shareholders' reports-Note 2(b)........................ 39,173
Directors' fees and expenses-Note 2(c)................................ 38,036
Registration fees..................................................... 4,745
Miscellaneous......................................................... 26,377
______
TOTAL EXPENSES.................................................... 5,852,459
Less-reduction in management fee
due to undertaking-Note 2(a)...................................... 907,858
______
NET EXPENSES...................................................... 4,944,601
______
INVESTMENT INCOME-NET............................................. 35,059,403
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments-Note 3................................. $ 4,018,796
Net unrealized appreciation on investments.............................. 49,285,419
______
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................... 53,304,215
______
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $88,363,618
======
See notes to financial statements.
</TABLE>
<TABLE>
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS
YEAR ENDED DECEMBER 31,
_________________________________
1994 1995
_______ ______
<S> <C> <C>
OPERATIONS:
Investment income-net................................................... $ 38,130,920 $ 35,059,403
Net realized gain (loss) on investments................................. (1,454,272) 4,018,796
Net unrealized appreciation (depreciation) on investments for the year.. (78,775,736) 49,285,419
_______ ______
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS....... (42,099,088) 88,363,618
_______ ______
DIVIDENDS TO SHAREHOLDERS:
From investment income-net.............................................. (38,036,943) (34,967,410)
From net realized gain on investments................................... _ (187,311)
In excess of net realized gain on investments........................... (743,575) -
_______ ______
TOTAL DIVIDENDS....................................................... (38,780,518) (35,154,721)
_______ ______
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold........................................... 167,291,374 345,417,332
Dividends reinvested.................................................... 29,894,610 26,626,785
Cost of shares redeemed................................................. (264,596,453) (348,941,494)
_______ ______
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS..... (67,410,469) 23,102,623
_______ ______
TOTAL INCREASE (DECREASE) IN NET ASSETS........................... (148,290,075) 76,311,520
NET ASSETS:
Beginning of year....................................................... 725,814,858 577,524,783
_______ ______
End of year (including undistributed investment income-net:
$93,977 in 1994 and $185,970 in 1995)................................. $ 577,524,783 $ 653,836,303
======= ======
SHARES SHARES
_______ ______
CAPITAL SHARE TRANSACTIONS:
Shares sold............................................................. 12,816,258 26,279,832
Shares issued for dividends reinvested.................................. 2,298,448 2,027,922
Shares redeemed......................................................... (20,301,295) (26,516,887)
_______ ______
NET INCREASE (DECREASE) IN SHARES OUTSTANDING......................... (5,186,589) 1,790,867
======= ======
See notes to financial statements.
</TABLE>
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
FINANCIAL HIGHLIGHTS
Reference is made to page 4 of the Fund's Prospectus dated
May 1, 1996.
See notes to financial statements.
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS
NOTE 1-SIGNIFICANT ACCOUNTING POLICIES:
The Fund is registered under the Investment Company Act of 1940 ("Act")
as a non-diversified open-end management investment company. Premier Mutual
Fund Services, Inc. (the "Distributor") acts as the distributor of the Fund's
shares, which are sold to the public without a sales load. The Distributor,
located at One Exchange Place, Boston, Massachusetts 02109, is a wholly-owned
subsidiary of FDI Distribution Services, Inc., a provider of mutual fund
administration services, which in turn is a wholly-owned subsidiary of FDI
Holdings, Inc., the parent company of which is Boston Institutional Group,
Inc. The Dreyfus Corporation ("Manager") serves as the Fund's investment
adviser. The Manager is a direct subsidiary of Mellon Bank, N.A.
(A) PORTFOLIO VALUATION: The Fund's investments are valued each business
day by an independent pricing service ("Service") approved by the Fund's
Board of Directors. Investments for which quoted bid prices are readily
available and are representative of the bid side of the market in the
judgment of the Service 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 securities of comparable quality, coupon, maturity and type;
indications as to values from dealers; and general market conditions.
(B) SECURITIES TRANSACTIONS AND INVESTMENT INCOME: Securities
transactions are recorded on a trade date basis. Realized gain and loss from
securities transactions are recorded on the identified cost basis. Interest
income, adjusted for amortization of premiums and original issue discounts on
investments, is earned from settlement date and recognized on the accrual
basis. Securities purchased or sold on a when-issued or delayed-delivery
basis may be settled a month or more after the trade date.
The Fund follows an investment policy of investing primarily in municipal
obligations of one state. Economic changes affecting the state and certain of
its public bodies and municipalities may affect the ability of issuers within
the state to pay interest on, or repay principal of, municipal obligations
held by the Fund.
(C) DIVIDENDS TO SHAREHOLDERS: It is the policy of the Fund to declare
dividends from investment income-net on each business day. Such dividends are
paid monthly. Dividends from net realized capital gain are normally declared
and paid annually, but the Fund may make distributions on a more frequent
basis to comply with the distribution requirements of the Internal Revenue
Code. To the extent that net realized capital gain can be offset by capital
loss carryovers, it is the policy of the Fund not to distribute such gain.
(D) FEDERAL INCOME TAXES: It is the policy of the Fund to continue to
qualify as a regulated investment company, which can distribute tax exempt
dividends, by complying with the applicable provisions of the Internal
Revenue Code, and to make distributions of income and net realized capital
gain sufficient to relieve it from substantially all Federal income and
excise taxes.
NOTE 2-MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES:
(A) Pursuant to a management agreement ("Agreement") with the Manager,
the management fee is computed at the annual rate of .60 of 1% of the average
daily value of the Fund's net assets and is
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
NOTES TO FINANCIAL STATEMENTS (CONTINUED)
payable monthly. The Agreement provides for an expense reimbursement from the
Manager should the Fund's aggregate expenses, exclusive of taxes, brokerage,
interest on borrowings and extraordinary expenses, exceed 11\2% of the value
of the Fund's average net assets for any full year. However, the Manager has
undertaken from January 1, 1995 through December 31, 1996, to reduce the
management fee paid by the Fund, to the extent that the Fund's aggregate
annual expenses (exclusive of certain expenses as described above) exceed an
annual rate of .80 of 1% of the average daily value of the Fund's net assets.
The reduction in management fee, pursuant to the undertaking, amounted to
$907,858 for the year ended December 31, 1995.
The undertaking may be modified by the Manager from time to time,
provided that the resulting expense reimbursement would not be less than the
amount required pursuant to the Agreement.
Effective December 1, 1995, the Fund compensates Dreyfus Transfer, Inc.,
a wholly-owned subsidiary of the Manager, under a transfer agency agreement
for providing personnel and facilities to perform transfer agency services
for the Fund. Such compensation amounted to $19,442 for the period from
December 1, 1995 through December 31, 1995.
(B) Under the Service Plan (the "Plan") adopted pursuant to Rule 12b-1
under the Act, the Fund (a) reimburses the Distributor for payments to
certain Service Agents for distributing the Fund's shares and servicing
shareholder accounts ("Servicing") and (b) pays the Manager and Dreyfus
Service Corporation, a wholly-owned subsidiary of the Manager, and any
affiliate of either of them (collectively, "Dreyfus") for advertising and
marketing relating to the Fund and for Servicing at an aggregate annual rate
of .25 of 1% of the value of the Fund's average daily net assets. Each of the
Distributor and Dreyfus may pay Service Agents (a securities dealer,
financial institution or other industry professional) a fee in respect of the
Fund's shares owned by shareholders with whom the Service Agent has a
Servicing relationship or for whom the Service Agent is the dealer or holder
of record. Each of the Distributor and Dreyfus determine the amounts to be
paid to Service Agents to which it will make payments and the basis on which
such payments are made. The Plan also separately provides for the Fund to
bear the costs of preparing, printing and distributing certain of the Fund's
prospectuses and statements of additional information and costs associated
with implementing and operating the Plan, not to exceed the greater of
$100,000 or .005 of 1% of the Fund's average daily net assets for any full
year. During the year ended December 31, 1995, $1,556,807 was charged to the
Fund pursuant to the Plan.
(C) Each director who is not an "affiliated person" as defined in the Act
receives from the Fund an annual fee of $2,500 and an attendance fee of $250
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 3-SECURITIES TRANSACTIONS:
The aggregate amount of purchases and sales of investment securities,
excluding short-term securities, during the year ended December 31, 1995,
amounted to $172,218,756 and $145,865,473, respectively.
At December 31, 1995, accumulated net unrealized appreciation on
investments was $49,346,562, consisting of $49,480,664 gross unrealized
appreciation and $134,102 gross unrealized depreciation.
At December 31, 1995, the cost of investments for Federal income tax
purposes was substantially the same as the cost for financial reporting
purposes (see the Statement of Investments).
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS
SHAREHOLDERS AND BOARD OF DIRECTORS
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
We have audited the accompanying statement of assets and liabilities of
Dreyfus New Jersey Municipal Bond Fund, Inc., including the statement of
investments, as of December 31, 1995, and the related statement of operations
for the year then ended, the statement of changes in net assets for each of
the two years in the period then ended, and financial highlights for each of
the years indicated therein. These financial statements and financial
highlights are the responsibility of the Fund's management. Our
responsibility is to express an opinion on these financial statements and
financial highlights based on our audits.
We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
securities owned as of December 31, 1995 by correspondence with the custodian.
An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.
In our opinion, the financial statements and financial highlights
referred to above present fairly, in all material respects, the financial
position of Dreyfus New Jersey Municipal Bond Fund, Inc. at December 31,
1995, the results of its operations for the year then ended, the changes in
its net assets for each of the two years in the period then ended, and the
financial highlights for each of the indicated years, in conformity with
generally accepted accounting principles.
[Ernst and Young LLP signature logo]
New York, New York
February 9, 1996
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
PART C. OTHER INFORMATION
_________________________
Item 24. Financial Statements and Exhibits. - List
_______ _________________________________________
(a) Financial Statements:
Included in Part A of the Registration Statement:
Condensed Financial Information for the period from
November 6, 1987 (commencement of operations) to
December 31, 1987 and for each of the eight years in
the period ended December 31, 1995.
Included in Part B of the Registration Statement:
Statement of Investments-- December 31, 1995.
Statement of Assets and Liabilities-- December 31,
1995.
Statement of Operations--year ended December 31, 1995.
Statement of Changes in Net Assets--for the years ended
December 31, 1994 and 1995.
Notes to Financial Statements.
Report of Ernst & Young LLP, Independent Auditors,
dated February 9, 1996.
Schedules No. I through VII and other financial statement information, for
which provision is made in the applicable accounting regulations of the
Securities and Exchange Commission, are either omitted because they are not
required under the related instructions, they are inapplicable, or the
required information is presented in the financial statements or notes
thereto which are included in Part B of the Registration Statement.
Item 24. Financial Statements and Exhibits. - List (continued)
_______ _____________________________________________________
(b) Exhibits:
(1)(a) Articles of Incorporation.
(1)(b) Articles of Amendment.
(2) By-Laws, as amended on July 20, 1989.
(4) Specimen certificate for the Registrant's securities is
incorporated by reference to Exhibit (4) of the Registration
Statement on Form N-1A, filed on January 16, 1988.
(5) Management Agreement is incorporated by reference to Exhibit (5)
of Post-Effective Amendment No. 8 to the Registration Statement
on Form N-1A, filed on March 1, 1995.
(6)(a) Distribution Agreement is incorporated by reference to Exhibit
(6)(a) of Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A, filed on March 1, 1995.
(6)(b) Forms of Service Agreement are incorporated by reference to
Exhibit (6)(b) of Post-Effective Amendment No. 8 to the
Registration Statement on Form N-1A, filed on March 1, 1995.
(8)(a) Amended and Restated Custody Agreement dated August 18, 1989.
(8)(b) Sub-Custodian Agreements.
(10) Opinion and Consent of Counsel.
(11) Consent of Independent Auditors.
(15) Service Plan is incorporated by reference to Exhibit (15) of
Post-Effective Amendment No. 8 to the Registration Statement on
Form N-1A, filed on March 1, 1995.
(16) Schedules of Computation of Performance Data are incorporated by
reference to Exhibit (16) of Post-Effective Amendment No. 7 to
the Registration Statement on Form N-1A filed on March 25, 1994.
(17) Financial Data Schedule.
Item 24. Financial Statements and Exhibits. - List (continued)
_______ _____________________________________________________
Other Exhibits
______________
(a) Powers of Attorney is incorporated by reference to
Other Exhibit (a) of Post-Effective Amendment No. 8 to
the Registration Statement on Form N-1A, filed on March
1, 1995.
(b) Certificate of Secretary is incorporated by reference
to Other Exhibit (b) of Post-Effective Amendment No. 8
to the Registration Statement on Form N-1A, filed on
March 1, 1995.
Item 25. Persons Controlled by or under Common Control with Registrant.
_______ ______________________________________________________________
Not Applicable
Item 26. Number of Holders of Securities.
_______ ________________________________
(1) (2)
Number of Record
Title of Class Holders as of April 1, 1996
______________ _____________________________
Common Stock 13,561
(Par value $.001)
Item 27. Indemnification
_______ _______________
Reference is made to Article SEVENTH of the Registrant's
Articles of Incorporation filed herewith and to Section 2-418
of the Maryland General Corporation Law. The application of
these provisions is limited by Article VIII of the
Registrant's By-Laws filed herewith, 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 directors, 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 against such
liabilities (other than the payment by the Registrant of
expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense
of any action, suit or proceeding) is asserted by such
director, 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.
Distribution Agreement is incorporated by reference to Exhibit
(6)(a) of Post-Effective Amendment No. 8 to the Registration
Statement on Form N-1A, filed on March 1, 1995.
Item 28. 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, manager and distributor 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, is a registered broker-dealer.
Dreyfus Management, Inc., another wholly-owned subsidiary,
provides investment management services to various pension
plans, institutions and individuals.
Item 28. Business and Other Connections of Investment Adviser (continued)
________ ________________________________________________________________
Officers and Directors of Investment Adviser
____________________________________________
Name and Position
with Dreyfus Other Businesses
_________________ ________________
MANDELL L. BERMAN Real estate consultant and private investor
Director 29100 Northwestern Highway, Suite 370
Southfield, Michigan 48034;
Past Chairman of the Board of Trustees:
Skillman Foundation;
Member of The Board of Vintners Intl.
FRANK V. CAHOUET Chairman of the Board, President and
Director Chief Executive Officer:
Mellon Bank Corporation****;
Mellon Bank, N.A.****
Director:
Avery Dennison Corporation
150 North Orange Grove Boulevard
Pasadena, California 91103;
Saint-Gobain Corporation
750 East Swedesford Road
Valley Forge, Pennsylvania 19482;
Teledyne, Inc.
1901 Avenue of the Stars
Los Angeles, California 90067
ALVIN E. FRIEDMAN Senior Adviser to Dillon, Read & Co. Inc.
Director 535 Madison Avenue
New York, New York 10022;
Director and Member of the Executive
Committee of Avnet, Inc.**
LAWRENCE M. GREENE Director:
Director Dreyfus America Fund
JULIAN M. SMERLING None
Director
HOWARD STEIN Chairman of the Board:
Chairman of the Board and Dreyfus Acquisition Corporation*;
Chief Executive Officer The Dreyfus Consumer Credit Corporation*;
Dreyfus Management, Inc.*;
Dreyfus Service Corporation*;
Chairman of the Board and Chief Executive
Officer:
Major Trading Corporation*;
Director:
Avnet, Inc.**;
Dreyfus America Fund++++;
The Dreyfus Fund International
Limited+++++;
World Balanced Fund+++;
Dreyfus Partnership Management,
Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Organization, Inc.***;
Seven Six Seven Agency, Inc.*;
Trustee:
Corporate Property Investors
New York, New York
W. KEITH SMITH Chairman and Chief Executive Officer:
Vice Chairman of the Board The Boston Company*****;
Vice Chairman of the Board:
Mellon Bank Corporation****;
Mellon Bank, N.A.****;
Director:
Dentsply International, Inc.
570 West College Avenue
York, Pennsylvania 17405
CHRISTOPHER M. CONDRON Vice Chairman:
President, Chief Mellon Bank Corporation****;
Operating Officer The Boston Company*****;
and a Director Deputy Director:
Mellon Trust****;
Chief Executive Officer:
The Boston Company Asset Management,
Inc.*****;
President:
Boston Safe Deposit and Trust
Company*****
STEPHEN E. CANTER Director:
Vice Chairman and The Dreyfus Trust Company++;
Chief Investment Officer, Formerly, Chairman and Chief Executive
Officer:
and a Director Kleinwort Benson Investment Management
Americas Inc.*
LAWRENCE S. KASH Chairman, President and Chief
Vice Chairman-Distribution Executive Officer:
and a Director The Boston Company Advisors, Inc.
53 State Street
Exchange Place
Boston, Massachusetts 02109
Executive Vice President and Director:
Dreyfus Service Organization, Inc.***;
Director:
The Dreyfus Consumer Credit Corporation*;
The Dreyfus Trust Company++;
Dreyfus Service Corporation*;
President:
The Boston Company*****;
Laurel Capital Advisors****;
Boston Group Holdings, Inc.;
Executive Vice President:
Mellon Bank, N.A.****;
Boston Safe Deposit and Trust
Company*****;
PHILIP L. TOIA Chairman of the Board and Trust Investment
Vice Chairman-Operations Officer:
and Administration The Dreyfus Trust Company++;
and a Director Chairman of the Board and Chief Operating
Officer:
Major Trading Corporation*;
Chairman and Director:
Dreyfus Transfer, Inc.
One American Express Plaza
Providence, Rhode Island 02903
Director:
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Corporation*;
Seven Six Seven Agency, Inc.*;
President and Director:
Dreyfus Acquisition Corporation*;
The Dreyfus Consumer Credit Corporation*;
Dreyfus-Lincoln, Inc.*;
Dreyfus Management, Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Partnership Management, Inc.+;
Dreyfus Service Organization, Inc.***;
The Truepenny Corporation*;
Formerly, Senior Vice President:
The Chase Manhattan Bank, N.A. and
The Chase Manhattan Capital Markets
Corporation
One Chase Manhattan Plaza
New York, New York 10081
WILLIAM T. SANDALLS, JR. Director:
Senior Vice President and Dreyfus Partnership Management, Inc.*;
Chief Financial Officer Seven Six Seven Agency, Inc.*;
President and Director:
Lion Management, Inc.*;
Executive Vice President and Director:
Dreyfus Service Organization, Inc.*;
Vice President, Chief Financial Officer and
Director:
Dreyfus Acquisition Corporation*;
Vice President and Director:
The Dreyfus Consumer Credit Corporation*;
The Truepenny Corporation*;
Treasurer, Financial Officer and Director:
The Dreyfus Trust Company++;
Treasurer and Director:
Dreyfus Management, Inc.*;
Dreyfus Personal Management, Inc.*;
Dreyfus Service Corporation*;
Major Trading Corporation*;
Formerly, President and Director:
Sandalls & Co., Inc.
BARBARA E. CASEY President:
Vice President- Dreyfus Retirement Services Division;
Dreyfus Retirement Executive Vice President:
Services Boston Safe Deposit & Trust Co.*****
Dreyfus Service Corporation*
DIANE M. COFFEY None
Vice President-
Corporate Communications
ELIE M. GENADRY President:
Vice President- Institutional Services Division of
Dreyfus
Institutional Sales Service Corporation*;
Broker-Dealer Division of Dreyfus Service
Corporation*;
Group Retirement Plans Division of
Dreyfus Service Corporation;
Executive Vice President:
Dreyfus Service Corporation*;
Dreyfus Service Organization, Inc.***;
Vice President:
The Dreyfus Trust Company++
MARY BETH LEIBIG None
Vice President-
Human Resources
JEFFREY N. NACHMAN President and Director:
Vice President-Mutual Fund Dreyfus Transfer, Inc.
Accounting One American Express Plaza
Providence, Rhode Island 02903
WILLIAM F. GLAVIN, JR. Executive Vice President:
Vice President-Corporate Dreyfus Service Corporation*;
Development Senior Vice President:
The Boston Company Advisors, Inc.
53 State Street
Exchange Place
Boston, Massachusetts 02109
MARK N. JACOBS Vice President, Secretary and Director:
Vice President- Lion Management, Inc.*;
General Counsel Secretary:
and Secretary The Dreyfus Consumer Credit Corporation*;
Dreyfus Management, Inc.*;
Assistant Secretary:
Dreyfus Service Organization, Inc.***;
Major Trading Corporation*;
The Truepenny Corporation*
ANDREW S. WASSER Vice President:
Vice President-Information Mellon Bank Corporation****
Services
MAURICE BENDRIHEM Treasurer:
Controller Dreyfus Partnership Management, Inc.*;
Dreyfus Precious Metals, Inc.*;
Dreyfus Service Organization, Inc.***;
Seven Six Seven Agency, Inc.*;
The Truepenny Corporation*;
Controller:
Dreyfus Acquisition Corporation*;
Dreyfus Service Corporation*;
The Dreyfus Trust Company++;
The Dreyfus Consumer Credit Corporation*;
Formerly, Vice President-Financial Planning,
Administration and Tax:
Showtime/The Movie Channel, Inc.
1633 Broadway
New York, New York 10019
ELVIRA OSLAPAS Assistant Secretary:
Assistant Secretary Dreyfus Service Corporation*;
Dreyfus Management, Inc.*;
Dreyfus Acquisition Corporation, Inc.*;
The Truepenny Corporation+
______________________________________
* The address of the business so indicated is 200 Park Avenue, New
York, New York 10166.
** The address of the business so indicated is 80 Cutter Mill Road,
Great Neck, New York 11021.
*** The address of the business so indicated is 131 Second Street,
Lewes, Delaware 19958.
**** The address of the business so indicated is One Mellon Bank Center,
Pittsburgh, Pennsylvania 15258.
***** The address of the business so indicated is One Boston Place,
Boston, Massachusetts 02108.
+ The address of the business so indicated is Atrium Building, 80
Route 4 East, Paramus, New Jersey 07652.
++ 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 One Rockefeller Plaza,
New York, New York 10020.
++++ The address of the business so indicated is 2 Boulevard Royal,
Luxembourg.
+++++ The address of the business so indicated is Nassau, Bahama Islands.
Item 29. Principal Underwriters
________ ______________________
(a) Other investment companies for which Registrant's principal
underwriter (exclusive distributor) acts as principal underwriter or
exclusive distributor:
1) Comstock Partners Strategy Fund, Inc.
2) Dreyfus A Bonds Plus, Inc.
3) Dreyfus Appreciation Fund, Inc.
4) Dreyfus Asset Allocation Fund, Inc.
5) Dreyfus Balanced Fund, Inc.
6) Dreyfus BASIC GNMA Fund
7) Dreyfus BASIC Money Market Fund, Inc.
8) Dreyfus BASIC Municipal Fund, Inc.
9) Dreyfus BASIC U.S. Government Money Market Fund
10) Dreyfus California Intermediate Municipal Bond Fund
11) Dreyfus California Tax Exempt Bond Fund, Inc.
12) Dreyfus California Tax Exempt Money Market Fund
13) Dreyfus Capital Value Fund, Inc.
14) Dreyfus Cash Management
15) Dreyfus Cash Management Plus, Inc.
16) Dreyfus Connecticut Intermediate Municipal Bond Fund
17) Dreyfus Connecticut Municipal Money Market Fund, Inc.
18) Dreyfus Edison Electric Index Fund, Inc.
19) Dreyfus Florida Intermediate Municipal Bond Fund
20) Dreyfus Florida Municipal Money Market Fund
21) The Dreyfus Fund Incorporated
22) Dreyfus Global Bond Fund, Inc.
23) Dreyfus Global Growth Fund
24) Dreyfus GNMA Fund, Inc.
25) Dreyfus Government Cash Management
26) Dreyfus Growth and Income Fund, Inc.
27) Dreyfus Growth and Value Funds, Inc.
28) Dreyfus Growth Opportunity Fund, Inc.
29) Dreyfus Institutional 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 Equity Fund, Inc.
34) The Dreyfus/Laurel Funds, Inc.
35) The Dreyfus/Laurel Funds Trust
36) The Dreyfus/Laurel Tax-Free Municipal Funds
37) The Dreyfus/Laurel Investment Series
38) Dreyfus Life and Annuity Index Fund, Inc.
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 Michigan Municipal Money Market Fund, Inc.
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 Insured Tax Exempt Bond Fund
54) Dreyfus New York Municipal Cash Management
55) Dreyfus New York Tax Exempt Bond Fund, Inc.
56) Dreyfus New York Tax Exempt Intermediate Bond Fund
57) Dreyfus New York Tax Exempt Money Market Fund
58) Dreyfus Ohio Municipal Money Market Fund, Inc.
59) Dreyfus 100% U.S. Treasury Intermediate Term Fund
60) Dreyfus 100% U.S. Treasury Long Term Fund
61) Dreyfus 100% U.S. Treasury Money Market Fund
62) Dreyfus 100% U.S. Treasury Short Term Fund
63) Dreyfus Pennsylvania Intermediate Municipal Bond Fund
64) Dreyfus Pennsylvania Municipal Money Market Fund
65) Dreyfus Short-Intermediate Government Fund
66) Dreyfus Short-Intermediate Municipal Bond Fund
67) Dreyfus Investment Grade Bond Funds, Inc.
68) The Dreyfus Socially Responsible Growth Fund, Inc.
69) Dreyfus Strategic Income
70) Dreyfus Strategic Investing
71) Dreyfus Tax Exempt Cash Management
72) The Dreyfus Third Century Fund, Inc.
73) Dreyfus Treasury Cash Management
74) Dreyfus Treasury Prime Cash Management
75) Dreyfus Variable Investment Fund
76) Dreyfus-Wilshire Target Funds, Inc.
77) Dreyfus Worldwide Dollar Money Market Fund, Inc.
78) General California Municipal Bond Fund, Inc.
79) General California Municipal Money Market Fund
80) General Government Securities Money Market Fund, Inc.
81) General Money Market Fund, Inc.
82) General Municipal Bond Fund, Inc.
83) General Municipal Money Market Fund, Inc.
84) General New York Municipal Bond Fund, Inc.
85) General New York Municipal Money Market Fund
86) Pacifica Funds Trust -
Pacifica Prime Money Market Fund
Pacifica Treasury Money Market Fund
87) Peoples Index Fund, Inc.
88) Peoples S&P MidCap Index Fund, Inc.
89) Premier Insured Municipal Bond Fund
90) Premier California Municipal Bond Fund
91) Premier Equity Funds, Inc.
92) Premier Global Investing, Inc.
93) Premier GNMA Fund
94) Premier Growth Fund, Inc.
95) Premier Municipal Bond Fund
96) Premier New York Municipal Bond Fund
97) Premier State Municipal Bond Fund
98) Premier Strategic Growth Fund
(b)
Positions and
Name and principal Positions and offices with offices with
business address the Distributor Registrant
__________________ ___________________________ _____________
Marie E. Connolly+ Director, President, Chief President and
Executive Officer and Compliance Treasurer
Officer
Joseph F. Tower, III+ Senior Vice President, Treasurer Assistant
and Chief Financial Officer Treasurer
John E. Pelletier+ Senior Vice President, General Vice President
Counsel, Secretary and Clerk and Secretary
Frederick C. Dey++ Senior Vice President Vice President
and Assistant
Treasurer
Eric B. Fischman++ Vice President and Associate Vice President
General Counsel and Assistant
Secretary
Paul Prescott+ Vice President None
Elizabeth Bachman++ Assistant Vice President Vice President
and Assistant
Secretary
Mary Nelson+ Assistant Treasurer None
John J. Pyburn++ Assistant Treasurer Assistant
Treasurer
Jean M. O'Leary+ Assistant Secretary and None
Assistant Clerk
John W. Gomez+ Director None
William J. Nutt+ Director None
________________________________
+ Principal business address is One Exchange Place, Boston, Massachusetts
02109.
++ Principal business address is 200 Park Avenue, New York, New York 10166.
Item 30. Location of Accounts and Records
________________________________
1. First Data Investor Services, Inc.,
a subsidiary of First Data Corporation
P.O. Box 9671
Providence, Rhode Island 02940-9671
2. The Bank of New York
90 Washington Street
New York, New York 10286
3. Dreyfus Transfer, Inc.
P.O. Box 9671
Providence, Rhode Island 02940-9671
4. The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Item 31. Management Services
_______ ___________________
Not Applicable
Item 32. Undertakings
________ ____________
(1) To call a meeting of shareholders for the purpose of voting upon
the question of removal of a director or directors when
requested in writing to do so by the holders of at least 10% of
the Registrant's outstanding shares of common stock and in
connection with such meeting to comply with the provisions of
Section 16(c) of the Investment Company Act of 1940 relating to
shareholder communications.
(2) To furnish each person to whom a prospectus is delivered with a
copy of the Fund's latest Annual Report to Shareholders, upon
request and without charge.
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 of effectiveness of this Amendment to the Registration
Statement pursuant to 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 17th day of April, 1996.
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
BY: /s/Marie E. Connolly*
---------------------------------
Marie E. Connolly, PRESIDENT
Pursuant to the requirements of the Securities Act of 1933, this
Amendment to the Registration Statement has been signed below by the
following persons in the capacities and on the date indicated.
Signatures Title Date
___________________________ ____________________________ _________
/s/Marie E. Connolly* President and Treasurer (Principal 04/17/96
- ----------------------------- Executive, Financial and Accounting
Marie E. Connolly Officer)
/s/Joseph S. DiMartino* Chairman of the Board 04/17/96
- -----------------------------
Joseph S. DiMartino
/s/Gordon J. Davis* Director 04/17/96
- -----------------------------
Gordon J. Davis
/s/David P. Feldman* Director 04/17/96
- -----------------------------
David P. Feldman
/s/Lynn Martin* Director 04/17/96
- -----------------------------
Lynn Martin
/s/Daniel Rose* Director 04/17/96
- -----------------------------
Daniel Rose
/s/Anne Wexler* Director 04/17/96
- -----------------------------
Anne Wexler
/s/Sander Vanocur* Director 04/17/96
- -----------------------------
Sander Vanocur
/s/Rex Wilder* Director 04/17/96
- -----------------------------
Rex Wilder
*BY: /s/Eric B. Fischman
-----------------------------
Eric B. Fischman,
Attorney-in-Fact
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC.
Post-Effective Amendment No. 10 to
Registration Statement on Form N-1A under
the Securities Act of 1933 and
the Investment Company Act of 1940
EXHIBITS
INDEX TO EXHIBITS
(1)(a) Articles of Incorporation.
(1)(b) Articles of Amendment.
(2) By-Laws, as amended.
(8)(a) Amended and restated Custody Agreement, dated August 18, 1989.
(8)(b) Sub-Custodian Agreements.
(10) Opinion and Consent of Counsel.
(11) Consent of Independent Auditors.
(17) Financial Data Schedule.
ARTICLES OF INCORPORATION
OF
DREYFUS NEW JERSEY
TAX EXEMPT BOND FUND, INC.
FIRST: The undersigned, Mitchell A. Tanzman, whose
address is Seven Hanover Square, New York, New York 10004-2594,
being at least eighteen years of age, hereby forms a corporation
under the Maryland General Corporation Law.
SECOND: The name of the corporation (hereinafter
called the "corporation") is Dreyfus New Jersey Tax Exempt Bond
Fund, Inc.
THIRD: The corporation is formed for the following
purpose or purposes:
(a) to conduct, operate and carry on the
business of an investment company;
(b) to subscribe for, invest in, reinvest
in, purchase or otherwise acquire, hold, pledge, sell,
assign, transfer, lend, write options on, exchange,
distribute or otherwise dispose of and deal in and
with securities of every nature, kind, character, type
and form, including without limitation of the
generality of the foregoing, all types of stocks,
shares, futures contracts, bonds, debentures, notes,
bills and other negotiable or non-negotiable
instruments, obligations, evidences of interest,
certificates of interest, certificates of
participation, certificates, interests,
evidences of ownership, guarantees, warrants, options
or evidences of indebtedness issued or created by or
guaranteed as to principal and interest by any state
or local government or any agency or instrumentality
thereof, by the United States Government or any
agency, instrumentality, territory, district or
possession thereof, by any foreign government or any
agency, instrumentality, territory, district or
possession thereof, by any corporation organized under
the laws of any state, the United States or any
territory or possession thereof or under the laws of
any foreign country, bank certificates of deposit, bank
time deposits, bankers' acceptances and commercial
paper; to pay for the same in cash or by the issue of
stock, including treasury stock, bonds or notes of the
corporation or otherwise; and to exercise any and all
rights, powers and privileges of ownership or interest
in respect of any and all such investments of every
kind and description, including without limitation, the
right to consent and otherwise act with respect
thereto, with power to designate one or more persons,
firms, associations or corporations to exercise any of
said rights, powers and privileges in respect of any
said instruments;
(c) to borrow money or otherwise obtain credit
and to secure the same by mortgaging, pledging or
otherwise subjecting as security the assets of the
corporation;
(d) to issue, sell, repurchase, redeem,
retire, cancel, acquire, hold, resell, reissue,
dispose of, transfer, and otherwise deal in, shares of
stock of the corporation, including shares of stock of
the corporation in fractional denominations, and to
apply to any such repurchase, redemption, retirement,
cancellation or acquisition of shares of stock of the
corporation any funds or property of the corporation
whether capital or surplus or otherwise, to the full
extent now or hereafter permitted by the laws of the
State of Maryland;
(e) to conduct its business, promote its
purposes and carry on its operations in any and all of
its branches and maintain offices both within and
without the State of Maryland, in any States of the
United States of America, in the District of Columbia
and in any other parts of the world; and
(f) to do all and everything necessary,
suitable, convenient, or proper for the conduct,
promotion and attainment of any of the businesses and
purposes herein specified or which at any time may be
incidental thereto or may appear conducive to or
expedient for the accomplishment of any of such
businesses and purposes and which might be engaged in
or carried on by a corporation incorporated or
organized under the Maryland General Corporation Law,
and to have and exercise all of the powers conferred by
the laws of the State of Maryland upon corporations
incorporated or organized under the Maryland General
Corporation Law.
The foregoing provisions of this Article THIRD shall
be construed both as purposes and powers and each as an
independent purpose and power. The foregoing enumeration of
specific purposes and powers shall not be held to limit or
restrict in any manner the purposes and powers of the
corporation, and the purposes and powers herein specified shall,
except when otherwise provided in this Article THIRD, be in no
wise limited or restricted by reference to, or inference from,
the terms of any provision of this or any other Article of these
Articles of Incorporation; provided, that the corporation shall
not conduct any business, promote any purpose, or exercise any
power or privilege within or without the State of Maryland which,
under the laws thereof, the corporation may not lawfully conduct,
promote, or exercise.
FOURTH: The post office address of the principal
office of the corporation within the State of Maryland, and of
the resident agent of the corporation within the State of
Maryland, is The Corporation Trust Incorporated, 32 South Street,
Baltimore, Maryland 21202.
FIFTH: (1) The total number of shares of stock which
the corporation has authority to issue is five hundred million
(500,000,000) shares of Common Stock, all of which are of a par
value of one tenth of one cent ($.001) each.
(2) The aggregate par value of all the authorized
shares of stock is five hundred thousand ($500,000) dollars.
(3) The Board of Directors of the corporation is
authorized, from time to time, to fix the price or the minimum
price or the consideration or minimum consideration for, and to
issue, the shares of stock of the corporation.
(4) The Board of Directors of the corporation is
authorized, from time to time, to classify or to reclassify, as
the case may be, any unissued shares of stock of the
corporation.
(5) Subject to the power of the Board of Directors to
reclassify unissued shares, the shares of each class of stock of
the corporation shall have the following preferences, conversion
and other rights, voting powers, restrictions, limitations as to
dividends, qualifications and terms and conditions of
redemption:
(i) All consideration received by the
corporation for the issuance or sale of shares
together with all income, earnings, profits and
proceeds thereof, shall irrevocably belong to such
class for all purposes, subject only to the rights of
creditors and are herein referred to as "assets
belonging to" such class.
(ii) The assets belonging to such class
shall be charged with the liabilities of the
corporation in respect of such class and with such
class's share of the general liabilities of the
corporation, in the latter case in proportion that the
net asset value of such class bears to the net asset
value of all classes.
The determination of the Board of Directors shall be
conclusive as to the allocation of liabilities,
including accrued expenses and reserves, to a class.
(iii) Dividends or distributions on shares
of each class, whether payable in stock or cash, shall
be paid only out of earnings, surplus or other assets
belonging to such class.
(iv) In the event of the liquidation or
dissolution of the corporation, stockholders of each
class shall be entitled to receive, as a class, out of
the assets of the corporation available for
distribution to stockholders, the assets belonging to
such class and the assets so distributable to the
stockholders of such class shall be distributed among
such stockholders in proportion to the number of shares
of such class held by them.
(v) On each matter submitted to a vote of
the stockholders, each holder of a share of stock shall
be entitled to one vote for each such share of stock
standing in his name on the books of the corporation
irrespective of the class thereof; provided, however,
that to the extent class voting is required by the
Investment Company Act of 1940 or Maryland law as to
any such matter, those requirements shall apply.
Except as provided above, all provisions of the Articles of
Incorporation relating to stock of the corporation shall apply
to shares of, and to the holders of, all classes of stock.
(6) Notwithstanding any provisions of the Maryland
General Corporation Law requiring a greater proportion than a
majority of the votes of stockholders entitled to be cast in
order to take or authorize any action, any such action may be
taken or authorized upon the concurrence of a majority of the
aggregate number of votes entitled to be cast thereon.
(7) The presence in person or by proxy of the holders
of one-third of the shares of stock of the corporation entitled
to vote (without regard to class) shall constitute a quorum at
any meeting of the stockholders, except with respect to any
matter which, under applicable statutes or regulatory
requirements, requires approval by a separate vote of one or more
classes of stock, in which case the presence in person or by
proxy of the holders of one-third of the shares of stock of each
class required to vote as a class on the matter shall constitute
a quorum.
(8) The corporation may issue shares of stock in
fractional denominations to the same extent as its whole shares,
and shares in fractional denominations shall be shares of stock
having proportionately to the respective fractions represented
thereby all the rights of whole shares, including, without
limitation, the right to vote, the right to receive dividends
and distributions and the right to participate upon liquidation
of the corporation, but excluding the right to receive a stock
certificate evidencing a fractional share.
(9) No holder of any shares of any class of the
corporation shall be entitled as of right to subscribe for,
purchase, or otherwise acquire any shares of any class which the
corporation proposes to issue, or any rights or options which
the corporation proposes to issue or to grant for the purchase of
shares of any class or for the purchase of any shares, bonds,
securities, or obligations of the corporation which are
convertible into or exchangeable for, or which carry any rights
to subscribe for, purchase, or otherwise acquire shares of any
class of the corporation; and any and all of such shares, bonds,
securities or obligations of the corporation, whether now or
hereafter authorized or created, may be issued, or may be
reissued or transferred if the same have been reacquired and have
treasury status, and any and all of such rights and options may
be granted by the Board of Directors to such persons, firms,
corporations and associations, and for such lawful consideration,
and on such terms, as the Board of Directors in its discretion
may determine, without first offering the same, or any thereof,
to any said holder.
SIXTH: (1) The number of directors of the
corporation, until such number shall be increased or decreased
pursuant to the by-laws of the corporation, is one. The number
of directors shall never be less than the minimum number
prescribed by the Maryland General Corporation Law.
(2) The name of the person who shall act as director
of the corporation until the first annual meeting or until his
successor or successors are duly chosen and qualify is as
follows:
Mark N. Jacobs
(3) The initial by-laws of the corporation shall be
adopted by the directors at their organizational meeting or by
their informal written action, as the case may be. Thereafter,
the power to make, alter, and repeal the by-laws of the
corporation shall be vested exclusively in the Board of
Directors of the corporation.
(4) Any determination made in good faith by or
pursuant to the direction of the Board of Directors, as to: the
amount of the assets, debts, obligations, or liabilities of the
corporation; the amount of any reserves or charges set up and the
propriety thereof; the time of or purpose for creating such
reserves or charges; the use, alteration or cancellation of any
reserves or charges (whether or not any debt, obligation or
liability for which such reserves or charges shall have been
created shall have been paid or discharged or shall be then or
thereafter required to be paid or discharged); the value of any
investment or fair value of any other asset of the corporation;
the amount of net investment income; the number of shares of
stock outstanding; the estimated expense in connection with
purchases or redemptions of the corporation's stock; the ability
to liquidate investments in orderly fashion; the extent to which
it is practicable to deliver a cross-section of the portfolio of
the corporation in payment for any such shares, or as to any
other matters relating to the issue, sale, purchase, redemption
and/or other acquisition or disposition of investments or shares
of the corporation, or the determination of the net asset value
of shares of the corporation shall be final and conclusive, and
shall be binding upon the corporation and all holders of its
shares, past, present and future, and shares of the
corporation are issued and sold on the condition and
understanding that any and all such determinations shall be
binding as aforesaid.
SEVENTH: (1) To the maximum extent permitted by the
Maryland General Corporation Law as from time to time amended,
the Corporation shall indemnify its currently acting and its
former directors, officers, and employees and those persons who,
at the request of the corporation serve or have served another
corporation, partnership, joint venture, trust or other
enterprise in one or more of such capacities. The
indemnification provided for herein shall not be deemed exclusive
of any other rights to which those seeking indemnification may be
entitled under any statute, by-law, agreement, vote of
stockholders or disinterested directors or otherwise.
(2) Anything herein contained to the contrary
notwithstanding, no officer or director of the corporation shall
be indemnified for any liability to the corporation or its
security holders to which he 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.
EIGHTH: Any holder of shares of stock of the
corporation may require the corporation to redeem and the
corporation shall be obligated to redeem at the option of such
holder all or any part of the shares of the corporation owned by
said holder, at the redemption price, pursuant to the method,
upon the terms and subject to the conditions hereinafter set
forth:
(a) The redemption price per share shall be the
net asset value per share determined at such time or
times as the Board of Directors of the corporation
shall designate in accordance with any provision of the
Investment Company Act of 1940, any rule or regulation
thereunder or exemption or exception therefrom, or any
rule or regulation made or adopted by any securities
association registered under the Securities Exchange
Act of 1934.
(b) Net asset value per share of a class shall
be determined by dividing:
(i) The total value of the assets of
such class determined as provided in Subsec-
tion (c) below less, to the extent
determined by or pursuant to the direction of
the Board of Directors, all debts,
obligations and liabilities of such class
(which debts, obligations and liabilities
shall include, without limitation of the
generality of the foregoing, any and all
debts, obligations, liabilities, or claims,
of any and every kind and nature, fixed,
accrued and otherwise, including the
estimated accrued expenses of management and
supervision, administration and
distribution and any reserves or charges for
any or all of the foregoing, whether for
taxes, expenses or otherwise) but excluding
such class' liability upon its shares and its
surplus, by
(ii) The total number of shares of such
class outstanding.
The Board of Directors is empowered, in its
absolute discretion, to establish other methods for
determining such net asset value whenever such other
methods are deemed by it to be necessary in order to
enable the corporation to comply with, or are deemed by
it to be desirable provided they are not inconsistent
with, any provision of the Investment Company Act of
1940 or any rule or regulation thereunder.
(c) In determining for the purposes of these
Articles of Incorporation the total value of the assets
of the corporation at any time, investments and any
other assets of the corporation shall be valued in such
manner as may be determined from time to time by the
Board of Directors.
(d) Payment of the redemption price by the
corporation may be made either in cash or in securities
or other assets at the time owned by the corporation or
partly in cash and partly in securities or other assets
at the time owned by the corporation. The value of any
part of such payment to be made in securities or other
assets of the corporation shall be the value employed
in determining the redemption price. Payment of the
redemption price shall be made on or before the seventh
day following the day on which the shares are properly
presented for redemption hereunder, except that
delivery of any securities included in any such payment
shall be made as promptly as any necessary transfers on
the books of the issuers whose securities are to be
delivered may be made.
The corporation, pursuant to resolution of the
Board of Directors, may deduct from the payment made
for any shares redeemed a liquidating charge not in
excess of one percent (1%) of the redemption price of
the shares so redeemed, and the Board of Directors may
alter or suspend any such liquidating charge from time
to time.
(e) The right of any holder of shares of stock
redeemed by the corporation as provided in this
Article EIGHTH to receive dividends or distributions
thereon and all other rights of such holder with
respect to such shares shall terminate at the time as
of which the redemption price of such shares is
determined, except the right of such holder to receive
(i) the redemption price of such shares from the
corporation in accordance with the provisions hereof,
and (ii) any dividend or distribution to which such
holder had previously become entitled as the record
holder of such shares on the record date for such
dividend or distribution.
(f) Redemption of shares of stock by the
corporation is conditional upon the corporation having
funds or property legally available therefor.
(g) The corporation, either directly or through
an agent, may repurchase its shares, out of funds
legally available therefor, upon such terms and
conditions and for such consideration as the Board of
Directors shall deem advisable, by agreement with the
owner at a price not exceeding the net asset value per
share as determined by the corporation at such time or
times as the Board of Directors of the corporation
shall designate, less a liquidating charge not to
exceed one percent (1%) of such net asset value, if and
as fixed by resolution of the Board of Directors of the
corporation from time to time, and take all other steps
deemed necessary or advisable in connection therewith.
(h) The corporation, pursuant to resolution of
the Board of Directors, may cause the redemption, upon
the terms set forth in such resolution and in
subsections (a) through (f) and subsection (i) of this
Article EIGHTH, of shares of stock owned by
stockholders whose shares have an aggregate net asset
value of five hundred dollars or less. Notwithstanding
any other provision of this Article EIGHTH, if
certificates representing such shares have been issued,
the redemption price need not be paid by the
corporation until such certificates are presented in
proper form for transfer to the corporation
or the agent of the corporation appointed for such
purpose; however, the redemption shall be effective,
in accordance with the resolution of the Board of
Direc-tors, regardless of whether or not such
presentation has been made.
(i) The obligations set forth in this Article
EIGHTH may be suspended or postponed as may be
permissible under the Investment Company Act of 1940
and the rules and regulations thereunder.
(j) The Board of Directors may establish other
terms and conditions and procedures for redemption,
including requirements as to delivery of certificates
evidencing shares, if issued.
NINTH: All persons who shall acquire stock or other
securities of the corporation shall acquire the same subject to
the provisions of the corporation's Charter, as from time to
time amended.
TENTH: From time to time any of the provisions of the
Charter of the corporation may be amended, altered or repealed,
including amendments which alter the contract rights of any
class of stock outstanding, and other provisions authorized by
the Maryland General Corporation Law at the time in force may be
added or inserted in the manner and at the time prescribed by
said Law, and all rights at any time conferred upon the
stockholders of the corporation by its Charter are granted
subject to the provisions of this Article.
IN WITNESS WHEREOF, I have adopted and signed these
Articles of Incorporation and do hereby acknowledge that the
adoption and signing are my act.
Dated: January 6, 1988
Mitchell A. Tanzman, Incorporator
ARTICLES OF AMENDMENT
DREYFUS NEW JERSEY MUNICIPAL BOND FUND, INC., a
Maryland corporation having its principal place of business in
Baltimore City, Maryland (hereinafter called the "Corporation"),
hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The charter of the Corporation is hereby
amended by striking Article SEVENTH of the Articles of
Incorporation and inserting in lieu thereof the following:
"SEVENTH: (1) To the fullest extent that
limitations on the liability of directors and
officers are permitted by the Maryland
General Corporation Law, no director or
officer of the corporation shall have any
liability to the corporation or its
stockholders for damages. This limitation on
liability applies to events occurring at the
time a person serves as a director or officer
of the corporation whether or not such person
is a director or officer at the time of any
proceeding in which liability is asserted.
(2) The corporation shall indemnify and
advance expenses to its currently acting and its
former directors to the fullest extent that
indemnification of directors is permitted by the
Maryland General Corporation Law. The corporation
shall indemnify and advance expenses to its
officers to the same extent as its directors and
to such further extent as is consistent with law.
The board of directors may, through a by-law,
resolution or agreement, make further provisions
for indemnification of directors, officers,
employees and agents to the fullest extent
permitted by the Maryland General Corporation Law.
(3) No provision of this Article SEVENTH
shall be effective to protect or purport to
protect any director or officer of the corporation
against any liability to the corporation or its
stockholders to which he 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.
(4) References to the Maryland General
Corporation Law in this Article SEVENTH are to the
law as from time to time amended. No amendment to
the Articles of Incorporation of the corporation
shall affect any right of any person under this
Article SEVENTH based on any event, omission or
proceeding prior to such amendment."
SECOND: The Board of Directors of the Corporation
approved the foregoing amendment to the charter as set forth in
Article FIRST hereto, and declared that said amendment was
advisable. The Corporation's stockholders approved the
foregoing amendment at a meeting held on November 20, 1992.
The Vice President acknowledges these Articles of
Amendment to be the corporate act of the Corporation and states
that to the best of his knowledge, information and belief the
matters and facts set forth in these Articles with respect to
the authorization and approval of the amendment of the
Corporation's charter are true in all material respects, and that
this statement is made under the penalties of perjury.
IN WITNESS WHEREOF, Dreyfus New Jersey Municipal Bond
Fund, Inc. has caused this instrument to be filed in its name
and on its behalf by its Vice President, Mark N. Jacobs, and
witnessed by its Assistant Secretary, Christine Pavalos, on the
4th day of December, 1992.
DREYFUS NEW JERSEY MUNICIPAL BOND FUND,
INC.
BY:
Mark N. Jacobs, Vice President
ATTEST:
Christine Pavalos,
Assistant Secretary
DREYFUS NEW JERSEY TAX EXEMPT BOND FUND, INC.
ARTICLES OF AMENDMENT
Dreyfus New Jersey Tax Exempt Bond Fund, Inc., a
Maryland corporation having its principal office in the State of
Maryland at 32 South Street, Baltimore, Maryland (hereinafter
called the "Corporation"), hereby certifies to the State
Department of Assessments and Taxation of Maryland that:
FIRST: The charter of the Corporation is hereby
amended by striking Article SECOND of the Articles of
Incorporation and inserting in lieu thereof the following:
"SECOND: The name of the corporation
(hereinafter called the 'corporation') is
Dreyfus New Jersey Municipal Bond Fund, Inc."
SECOND: The Board of Directors of the corporation by
unanimous written consent pursuant to Section 2-408 of the
Corporations and Associations Article of the Annotated Code of
Maryland dated as of ________________, 1990, duly adopted a
resolution in which was set forth the foregoing amendment to the
charter, declaring that the said amendment of the charter as
proposed was advisable.
THIRD: Said amendment has been consented to and
authorized by the holders of all the issued and outstanding
stock, entitled to vote, by a written consent given in
accordance with the provisions of Section 2-505 of the
Corporations and Associations Article of the Annotated Code of
Maryland, and filed with the records of stockholders meetings.
IN WITNESS WHEREOF, Dreyfus New Jersey Tax Exempt Bond
Fund, Inc. has caused these Articles to be signed and filed in
its name and on its behalf by its President and witnessed by its
Assistant Secretary on _____________, 1990.
DREYFUS NEW JERSEY TAX EXEMPT
BOND FUND, INC.
By:______________________________
Richard J. Moynihan, President
Witness:
Christine Pavalos,
Assistant Secretary
The undersigned, President of Dreyfus New Jersey Tax
Exempt Bond Fund, Inc., who executed on behalf of said
Corporation the foregoing Articles of Amendment, of which this
certificate is made a part, hereby acknowledges, in the name and
on behalf of said Corporation, the foregoing Articles of
Amendment to be the corporate act of said Corporation and
further certifies that, to the best of his knowledge,
information and belief, the matters and facts set forth therein
with respect to the approval thereof are true in all material
respects, under the penalties of perjury.
ARTICLES OF AMENDMENT
DREYFUS NEW JERSEY TAX EXEMPT BOND FUND, INC., a
Maryland corporation having its principal place of business in
Baltimore City, Maryland (hereinafter called the "Corporation"),
hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: The charter of the Corporation is hereby
amended by striking Article SECOND of the Articles of
Incorporation and inserting in lieu thereof the following:
"SECOND: The name of the corporation
(hereinafter called the 'corporation') is
Dreyfus New Jersey Municipal Bond Fund,
Inc."
SECOND: The Board of Directors of the Corporation
approved the foregoing amendment to the charter as set forth in
Article FIRST hereto, and declared that said amendment was
advisable. The Corporation's stockholders approved the
foregoing amendment at a meeting held on September 14, 1990.
The Vice President acknowledges these Articles of
Amendment to be the corporate act of the Corporation and states
that to the best of his knowledge, information and belief the
matters and facts set forth in these Articles with respect to
the authorization and approval of the amendment of the
Corporation's charter are true in all material respects, and
that this statement is made under the penalties of perjury.
IN WITNESS WHEREOF, Dreyfus New Jersey Tax Exempt Bond
Fund, Inc. has caused this instrument to be filed in its name
and on its behalf by its Vice President, Mark N. Jacobs, and
witnessed by its Secretary, Daniel C. Maclean, on the 14th day
of September, 1990.
DREYFUS NEW JERSEY TAX
EXEMPT
BOND FUND, INC.
BY:_________________________
Mark N. Jacobs,
Vice President
ATTEST:
___________________
Daniel C. Maclean,
Secretary
BY-LAWS
OF
DREYFUS NEW JERSEY TAX EXEMPT BOND FUND, INC.
(A Maryland Corporation)
__________
ARTICLE I
STOCKHOLDERS
1. CERTIFICATES REPRESENTING STOCK. Certificates representing
shares of stock shall set forth thereon the statements prescribed by Section 2-
211 of the Maryland General Corporation Law ("General Corporation Law") and by
any other applicable provision of law and shall be signed by the President or a
Vice President and countersigned by the Secretary or an As-sistant Secretary or
the Treasurer or an Assistant Treasurer and may be sealed with the corporate
seal. The signatures of any such officers may be either manual or facsimile
signatures and the corporate seal may be either facsimile or any other form of
seal. In case any such officer who has signed manually or by facsimile any
such certificate ceases to be such officer before the certificate is issued, it
nevertheless may be issued by the corporation with the same effect as if the
officer had not ceased to be such officer as of the date of its issue.
No certificate representing shares of stock shall be issued for any
share of stock until such share is fully paid, except as otherwise authorized
in Section 2-207 of the General Corporation Law.
The corporation may issue a new certificate of stock in place of any
certificate theretofore issued by it, alleged to have been lost, stolen or
destroyed, and the Board of Directors may require, in its discretion, the owner
of any such certificate or his legal representative to give bond, with
sufficient surety, to the corporation to indemnify it against any loss or claim
that may arise by reason of the issuance of a new certificate.
2. SHARE TRANSFERS. Upon compliance with provisions restricting the
transferability of shares of stock, if any, transfers of shares of stock of the
corporation shall be made only on the stock transfer books of the corporation
by the record holder thereof or by his attorney thereunto authorized by power
of attorney duly executed and filed with the Secretary of the corporation or
with a transfer agent or a registrar, if any, and on surrender of the
certificate or certificates for such shares of stock properly endorsed and the
payment of all taxes due thereon.
3. RECORD DATE FOR STOCKHOLDERS. The Board of Directors may fix, in
advance, a date as the record date for the purpose of determining stockholders
entitled to notice of, or to vote at, any meeting of stockholders, or
stockholders entitled to receive payment of any dividend or the allotment of
any rights or in order to make a determination of stockholders for any other
proper purpose. Such date, in any case, shall be not more than 90 days, and in
case of a meeting of stockholders not less than 10 days, prior to the date on
which the meeting or particular action requiring such determination of
stockholders is to be held or taken. In lieu of fixing a record date, the
Board of Directors may provide that the stock transfer books shall be closed
for a stated period but not to exceed 20 days. If the stock transfer books are
closed for the purpose of determining stockholders entitled to notice of, or to
vote at, a meeting of stockholders, such books shall be closed for at least 10
days immediately pre-ceding such meeting. If no record date is fixed and the
stock transfer books are not closed for the determination of stock-holders: (1)
The record date for the determination of stock-holders entitled to notice of,
or to vote at, a meeting of stock-holders shall be at the close of business on
the day on which the notice of meeting is mailed or the day 30 days before the
meeting, whichever is the closer date to the meeting; and (2) The record date
for the determination of stockholders entitled to receive payment of a dividend
or an allotment of any rights shall be at the close of business on the day on
which the resolution of the Board of Directors declaring the dividend or
allotment of rights is adopted, provided that the payment or allotment date
shall not be more than 60 days after the date on which the resolution is
adopted.
4. MEANING OF CERTAIN TERMS. As used herein in respect of the right
to notice of a meeting of stockholders or a waiver thereof or to participate or
vote thereat or to consent or dissent in writing in lieu of a meeting, as the
case may be, the term "share of stock" or "shares of stock" or "stockholder" or
"stock-holders" refers to an outstanding share or shares of stock and to a
holder or holders of record of outstanding shares of stock when the corporation
is authorized to issue only one class of shares of stock and said reference
also is intended to include any outstanding share or shares of stock and any
holder or holders of record of outstanding shares of stock of any class or
series upon which or upon whom the Charter confers such rights where there are
two or more classes or series of shares or upon which or upon whom the General
Corporation Law confers such rights notwithstanding that the Charter may
provide for more than one class or series of shares of stock, one or more of
which are limited or denied such rights thereunder.
5. STOCKHOLDER MEETINGS.
- ANNUAL MEETINGS. If a meeting of the stockholders of the
corporation is required by the Investment Company Act of 1940, as amended, to
elect the directors, then there shall be submitted to the stockholders at such
meeting the question of the election of directors, and a meeting called for
that purpose shall be designated the annual meeting of stockholders for that
year. In other years in which no action by stockholders is required for the
aforesaid election of directors, no annual meeting need be held.
- SPECIAL MEETINGS. Special stockholder meetings for any purpose
may be called by the Board of Directors or the President and shall be called by
the Secretary for the purpose of removing a Director whenever the holders of
shares entitled to at least ten percent of all the votes entitled to be cast at
such meeting shall make a duly authorized request that such meeting be
called.
The Secretary shall call a special meeting of stockholders for all
other purposes whenever the holders of shares entitled to at least twenty-five
percent of all the votes entitled to be cast at such meeting shall make a duly
authorized request that such meeting be called. Such request shall state the
purpose of such meeting and the matters proposed to be acted on thereat, and no
other business shall be transacted at any such special meeting. The Secretary
shall inform such stockholders of the reasonably estimated costs of preparing
and mailing the notice of the meeting, and upon payment to the corporation of
such costs, the Secretary shall give notice in the manner provided for below.
Notwithstanding the foregoing, unless requested by stockholders entitled to
cast a majority of the votes entitled to be cast at the meeting, a special
meeting of the stockholders need not be called at the request of stockholders
to consider any matter that is substantially the same as a matter voted on at
any special meeting of the stockholders held during the preceding twelve (12)
months.
- PLACE AND TIME. Stockholder meetings shall be held at such place,
either within the State of Maryland or at such other place within the United
States, and at such date or dates as the directors from time to time may fix.
- NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER OF NOTICE. Written or
printed notice of all meetings shall be given by the Secretary and shall state
the time and place of the meeting. The notice of a meeting shall state in all
instances the purpose or purposes for which the meeting is called. Written or
printed notice of any meeting shall be given to each stockholder either by
mail or by presenting it to him personally or by leaving it at his
residence or usual place of business not less than ten days and not more than
ninety days before the date of the meeting, unless any provisions of the
General Corporation Law shall prescribe a different elapsed period of time, to
each stockholder at his address appearing on the books of the corporation or
the address supplied by him for the purpose of notice. If mailed, notice shall
be deemed to be given when deposited in the United States mail addressed to the
stockholder at his post office address as it appears on the records of the
corporation with postage thereon prepaid. Whenever any notice of the time,
place or purpose of any meeting of stockholders is required to be given under
the provisions of these by-laws or of the General Corporation Law, a waiver
thereof in writing, signed by the stockholder and filed with the records of the
meeting, whether before or after the holding thereof, or actual attendance or
representation at the meeting shall be deemed equivalent to the giving of such
notice to such stockholder. The foregoing requirements of notice also shall
apply, whenever the corporation shall have any class of stock which is not
entitled to vote, to holders of stock who are not entitled to vote at the
meeting, but who are entitled to notice thereof and to dissent from any action
taken thereat.
- STATEMENT OF AFFAIRS. The President of the corporation or, if the
Board of Directors shall determine otherwise, some other executive officer
thereof, shall prepare or cause to be prepared annually a full and correct
statement of the affairs of the corporation, including a balance sheet and a
financial statement of operations for the preceding fiscal year, which shall be
filed at the principal office of the corporation in the State of Maryland.
- CONDUCT OF MEETING. Meetings of the stockholders shall be
presided over by one of the following officers in the order of seniority and if
present and acting: the President, the Chairman of the Board, a Vice President
or, if none of the foregoing is in office and present and acting, by a chairman
to be chosen by the stockholders. The Secretary of the corporation or,
in his absence, an Assistant Secretary, shall act as secretary of
every meeting, but if neither the Secretary nor an Assistant Secretary is
present the chairman of the meeting shall appoint a secretary of the meeting.
- PROXY REPRESENTATION. Every stockholder may authorize another
person or persons to act for him by proxy in all matters in which a stockholder
is entitled to participate, whether for the purposes of determining his
presence at a meeting, or whether by waiving notice of any meeting, voting or
participating at a meeting, expressing consent or dissent without a meeting or
otherwise. Every proxy shall be executed in writing by the stock-
holder or by his duly authorized attorney-in-fact and filed with the Secretary
of the corporation. No unrevoked proxy shall be valid after eleven months from
the date of its execution, unless a longer time is expressly provided therein.
- INSPECTORS OF ELECTION. The directors, in advance of
any meeting, may, but need not, appoint one or more inspectors to
act at the meeting or any adjournment thereof. If an inspector or
inspectors are not appointed, the person presiding at the meeting
may, but need not, appoint one or more inspectors. In case any person who may
be appointed as an inspector fails to appear or act, the vacancy may be filled
by appointment made by the directors in advance of the meeting or at the
meeting by the person presiding thereat. Each inspector, if any, before
entering upon the discharge of his duties, shall take and sign an oath to
execute faithfully the duties of inspector at such meeting with strict
impartiality and according to the best of his ability. The
inspectors, if any, shall determine the number of shares outstanding and the
voting power of each, the shares represented at the meeting, the existence of a
quorum and the validity and effect of proxies, and shall receive votes, ballots
or consents, hear and determine all challenges and questions arising in
connection with the right to vote, count and tabulate all votes, ballots or
consents, determine the result and do such acts as are
proper to conduct the election or vote with fairness to all stockholders. On
request of the person presiding at the meeting or any stockholder, the
inspector or inspectors, if any, shall make a report in writing of any
challenge, question or matter determined by him or them and execute a
certificate of any fact found by him or them.
- VOTING. Each share of stock shall entitle the holder
thereof to one vote, except in the election of directors, at which
each said vote may be cast for as many persons as there are direc-
tors to be elected. Except for election of directors, a majority
of the votes cast at a meeting of stockholders, duly called and at
which a quorum is present, shall be sufficient to take or authorize action upon
any matter which may come before a meeting, unless more than a majority of
votes cast is required by the corporation's Articles of Incorporation. A
plurality of all the votes cast at a meeting at which a quorum is present shall
be sufficient to elect a director.
6. INFORMAL ACTION. Any action required or permitted to be taken at
a meeting of stockholders may be taken without a meeting if a consent in
writing, setting forth such action, is signed by all the stockholders entitled
to vote on the subject matter thereof and any other stockholders entitled to
notice of a meeting of stockholders (but not to vote thereat) have waived in
writing any rights which they may have to dissent from such action
and such consent and waiver are filed with the records of the corporation.
ARTICLE II
BOARD OF DIRECTORS
1. FUNCTIONS AND DEFINITION. The business and affairs
of the corporation shall be managed under the direction of a Board
of Directors. The use of the phrase "entire board" herein refers
to the total number of directors which the corporation would have
if there were no vacancies.
2. QUALIFICATIONS AND NUMBER. Each director shall be a
natural person of full age. A director need not be a stockholder,
a citizen of the United States or a resident of the State of Mary-
land. The initial Board of Directors shall consist of one person.
Thereafter, the number of directors constituting the entire board
shall never be less than three or the number of stockholders, whichever is
less. At any regular meeting or at any special meeting called for that
purpose, a majority of the entire Board of Directors may increase or decrease
the number of directors, pro-vided that the number thereof shall never be less
than three or the number of stockholders, whichever is less, nor more than
eleven and further provided that the tenure of office of a director shall not
be affected by any decrease in the number of directors.
3. ELECTION AND TERM. The first Board of Directors shall consist of
the director named in the Articles of Incorporation and shall hold office until
the first meeting of stockholders or until his successor has been elected and
qualified. Thereafter, directors who are elected at a meeting of stockholders,
and directors who are elected in the interim to fill vacancies and newly
created directorships, shall hold office until their successors have been
elected and qualified. Newly created directorships and any vacancies in the
Board of Directors, other than vacancies resulting from the removal of
directors by the stockholders, may be filled by the Board of Directors, subject
to the provisions of the Investment Company Act of 1940. Newly created
directorships filled by the Board of Directors shall be by
action of a majority of the entire Board of Directors. All other
vacancies to be filled by the Board of Directors may be filled by
a majority of the remaining members of the Board of Directors, although such
majority is less than a quorum thereof.
4. MEETINGS.
- TIME. Meetings shall be held at such time as the Board shall fix,
except that the first meeting of a newly elected Board shall be held as soon
after its election as the directors conveniently may assemble.
- PLACE. Meetings shall be held at such place within or without the
State of Maryland as shall be fixed by the Board.
- CALL. No call shall be required for regular meetings
for which the time and place have been fixed. Special meetings may be called
by or at the direction of the President or of a majority of the directors in
office.
- NOTICE OR ACTUAL OR CONSTRUCTIVE WAIVER. Whenever any notice of
the time, place or purpose of any meeting of directors or any committee thereof
is required to be given under the provisions of the General Corporation Law or
of these by-laws, a waiver thereof in writing, signed by the director or
committee member entitled to such notice and filed with the records of the
meeting, whether before or after the holding thereof, or actual attendance at
the meeting shall be deemed equivalent to the giving of such notice to such
director or such committee member.
- QUORUM AND ACTION. A majority of the entire Board of
Directors shall constitute a quorum except when a vacancy or vacancies prevents
such majority, whereupon a majority of the directors in office shall constitute
a quorum, provided such majority shall constitute at least one-third of the
entire Board and, in no event, less than two directors. A majority of the
directors present, whether or not a quorum is present, may adjourn
a meeting to another time and place. Except as herein otherwise provided and,
except as in the General Corporation Law otherwise provided, the action of a
majority of the directors present at a meeting at which a quorum is present
shall be the action of the Board of Directors.
- CHAIRMAN OF THE MEETING. The Chairman of the Board,
if any and if present and acting, or the President or any other director chosen
by the Board, shall preside at all meetings.
5. REMOVAL OF DIRECTORS. Any or all of the directors may be removed
for cause or without cause by the stockholders, who may elect a successor or
successors to fill any resulting vacancy or vacancies for the unexpired term of
the removed director or directors.
6. COMMITTEES. The Board of Directors may appoint from
among its members an Executive Committee and other committees composed of two
or more directors and may delegate to such committee or committees, in the
intervals between meetings of the Board of Directors, any or all of the powers
of the Board of Directors in the management of the business and affairs of the
corporation, except the power to amend the by-laws, to approve any
consolidation, merger, share exchange or transfer of assets, to declare
dividends, to issue stock or to recommend to stockholders
any action requiring the stockholders' approval. In the absence of any member
of any such committee, the members thereof present at any meeting, whether or
not they constitute a quorum, may appoint a member of the Board of Directors to
act in the place of
such absent member.
7. INFORMAL ACTION. Any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee thereof may be taken
without a meeting, if a written consent to such action is signed by all members
of the Board of Directors or any such committee, as the case may be, and such
written consent is filed with the minutes of the proceedings of the Board or
any such committee.
Members of the Board of Directors or any committee designated thereby
may participate in a meeting of such Board or committee by means of a
conference telephone or similar communications equipment by means of which all
persons participating in the meeting can hear each other at the same time.
Participation by such means shall constitute presence in person at
a meeting.
ARTICLE III
OFFICERS
The corporation may have a Chairman of the Board and shall have a
President, a Secretary and a Treasurer, who shall be elected by the Board of
Directors, and may have such other officers, assistant officers and agents as
the Board of Directors shall authorize from time to time. Any two or more
offices, except those of President and Vice President, may be held by the same
person, but no person shall execute, acknowledge or verify any instrument in
more than one capacity, if such instrument is required by law to be executed,
acknowledged or verified by two or more officers.
Any officer or agent may be removed by the Board of Directors
whenever, in its judgment, the best interests of the corporation will be served
thereby.
ARTICLE IV
PRINCIPAL OFFICE - RESIDENT AGENT - STOCK LEDGER
The address of the principal office of the corporation in the State
of Maryland prescribed by the General Corporation Law is 32 South Street, c/o
The Corporation Trust Incorporated, Baltimore, Maryland 21202. The name and
address of the resident agent in the State of Maryland prescribed by the
General Corpora- tion Law are: The Corporation Trust Incorporated, 32 South
Street, Baltimore, Maryland 21202.
The corporation shall maintain, at its principal office
in the State of Maryland prescribed by the General Corporation Law
or at the business office or an agency of the corporation, an original or
duplicate stock ledger containing the names and addresses of all stockholders
and the number of shares of each class held by each stockholder. Such stock
ledger may be in written form or any other form capable of being converted into
written form within a reasonable time for visual inspection.
The corporation shall keep at said principal office in the State of
Maryland the original or a certified copy of the by-laws, including all
amendments thereto, and shall duly file thereat the annual statement of affairs
of the corporation prescribed by Section 2-314 of the General Corporation Law.
ARTICLE V
CORPORATE SEAL
The corporate seal shall have inscribed thereon the name
of the corporation and shall be in such form and contain such other words
and/or figures as the Board of Directors shall determine or the law require.
ARTICLE VI
FISCAL YEAR
The fiscal year of the corporation shall be fixed, and shall be
subject to change, by the Board of Directors.
ARTICLE VII
CONTROL OVER BY-LAWS
The power to make, alter, amend and repeal the by-laws is vested in
the Board of Directors of the corporation.
ARTICLE VIII
INDEMNIFICATION
Notwithstanding any provision in the General Corporation
Law or the corporation's Articles of Incorporation:
In the event that a claim for
indemnification is asserted by a director,
officer or controlling person of the
corporation in connection with the registered
securities of the corporation, the corporation
will not make such indemnification unless
(i) the corporation has submitted, before a
court or other body, the question of whether
the person to be indemnified was liable by
reason of wilful 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 corporation 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 directors 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 corporation will not advance
attorneys' fees or other expenses incurred by
the person to be indemnified unless the
corporation shall have (i) 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 one of the following
conditions shall have occurred: (x) such
person shall provide security for his
undertaking, (y) the corporation shall be
insured against losses arising by reason of
any lawful advances or (z) a majority of the
disinterested, non-party directors of the
corporation, 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.
As amended, July 20, 1989
AMENDED AND RESTATED CUSTODY AGREEMENT
Amended and Restated Custody Agreement made as of
August 18, 1989 between DREYFUS NEW JERSEY TAX EXEMPT BOND FUND,
INC., a corporation organized and existing under the laws of the
State of Maryland, having its principal office and place of
business at 666 Old Country Road, Garden City New York 11530
(hereinafter called the "Fund"), and THE BANK OF NEW YORK, a New
York corporation authorized to do a banking business, having its
principal office and place of business at 48 Wall Street, New
York, New York 10015 (hereinafter called the "Custodian").
W I T N E S S E T H :
that for and in consideration of the mutual promises hereinafter
set forth the Fund and the Custodian agree as follows:
ARTICLE I
DEFINITIONS
Whenever used in this Agreement, the following words
and phrases, unless the context otherwise requires, shall have
the following meanings:
1. "Authorized Person" shall be deemed to include the
Treasurer, the Controller or any other person, whether or not
any such person is an Officer or employee of the Fund, duly
authorized by the Directors of the Fund to give Oral
Instructions and Written Instructions on behalf of the Fund and
listed in the Certificate annexed hereto as Appendix A or such
other Certificate as may be received by the Custodian from time
to time.
2. "Available Balance" shall mean for any given day
during a calendar year the aggregate amount of Federal Funds
held in the Fund's custody account(s) at The Bank of New York,
or its successors, as of the close of such day or, if such day
is not a business day, the close of the preceding business day.
3. "Bankruptcy" shall mean with respect to a party
such party's making a general assignment, arrangement or
composition with or for the benefit of its creditors, or
instituting or having instituted against it a proceeding seeking
a judgment of insolvency or bankruptcy or the entry of an order
for relief under the Federal bankruptcy law or any other relief
under any bankruptcy or insolvency law or other similar law
affecting creditors' rights, or if a petition is presented for
the winding up or liquidation of the party or a resolution is
passed for its winding up or liquidation, or it seeks, or
becomes subject to, the appointment of an administrator,
receiver, trustee, custodian or other similar official for it or
for all or substantially all of its assets or its taking any
action in furtherance of, or indicating its consent to approval
of, or acquiescence in, any of the foregoing.
4. "Book-Entry System" shall mean the Federal
Reserve/Treasury book-entry system for United States and Federal
agency securities, its successor or successors and its nominee
or nominees.
5. "Call Option" shall mean an exchange traded option
with respect to Securities other than Stock Index Options,
Futures Contracts and Futures Contract Options entitling the
holder, upon timely exercise and payment of the exercise price,
as specified therein, to purchase from the writer thereof the
specified underlying Securities.
6. "Certificate" shall mean any notice, instruction,
or other instrument in writing, authorized or required by this
Agreement to be given to the Custodian, which is actually
received by the Custodian and signed on behalf of the Fund by
any two Officers of the Fund.
7. "Clearing Member" shall mean a registered
broker-dealer which is a clearing member under the rules of
O.C.C. and a member of a national securities exchange qualified
to act as a custodian for an investment company, or any
broker-dealer reasonably believed by the Custodian to be such a
clearing member.
8. "Collateral Account" shall mean a segregated
account so denominated and pledged to the Custodian as security
for, and in consideration of, the Custodian's issuance of (a)
any Put Option guarantee letter or similar document described in
paragraph 8 of Article V herein, or (b) any receipt described in
Article V or VIII herein.
9. "Consumer Price Index" shall mean the U.S.
Consumer Price Index, all items and all urban consumers, U.S.
city average 1982-84 equals 100, as first published without
seasonal adjustment by the Bureau of Labor Statistics, the
Department of Labor, without regard to subsequent revisions or
corrections by such Bureau.
10. "Covered Call Option" shall mean an exchange
traded option entitling the holder, upon timely exercise and
payment of the exercise price, as specified therein, to purchase
from the writer thereof the specified Securities (excluding
Futures Contracts) which are owned by the writer thereof and
subject to appropriate restrictions.
11. "Depository" shall mean The Depository Trust
Company ("DTC"), a clearing agency registered with the
Securities and Exchange Commission, its successor or successors
and its nominee or nominees, provided the Custodian has received
a certified copy of a resolution of the Fund's Directors
specifically approving deposits in DTC. The term "Depository"
shall further mean and include any other person authorized to
act as a depository under the Investment Company Act of 1940,
its successor or successors and its nominee or nominees,
specifically identified in a certified copy of a resolution of
the Fund's Directors specifically approving deposits therein by
the Custodian.
12. "Earnings Credit" shall mean for any given day
during a calendar year the product of (a) the Federal Funds Rate
for such date minus .25%, and (b) 82% of the Available Balance.
13. "Federal Funds" shall mean immediately available
same day funds.
14. "Federal Funds Rate" shall mean, for any day, the
Federal Funds (Effective) interest rate so denominated as
published in Federal Reserve Statistical Release H.I5 (519) and
applicable to such day and each succeeding day which is not a
business day.
15. "Financial Futures Contract" shall mean the firm
commitment to buy or sell fixed income securities, including,
without limitation, U.S. Treasury Bills, U.S. Treasury Notes,
U.S. Treasury Bonds, domestic bank certificates of deposit, and
Eurodollar certificates of deposit, during a specified month at
an agreed upon price.
16. "Futures Contract" shall mean a Financial Futures
Contract and/or Stock Index Futures Contracts.
17. "Futures Contract Option" shall mean an option
with respect to a Futures Contract.
18. "Margin Account" shall mean a segregated account
in the name of a broker, dealer, futures commission merchant or
Clearing Member, or in the name of the Fund for the benefit of a
broker, dealer, futures commission merchant or Clearing Member,
or otherwise, in accordance with an agreement between the Fund,
the Custodian and a broker, dealer, futures commission merchant
or Clearing Member (a "Margin Account Agreement"), separate and
distinct from the custody account, in which certain Securities
and/or money of the Fund shall be deposited and withdrawn from
time to time in connection with such transactions as the Fund
may from time to time determine. Securities held in the
Book-Entry System or the Depository shall be deemed to have been
deposited in, or withdrawn from, a Margin Account upon the
Custodian's effecting an appropriate entry on its books and
records.
19. "Merger" shall mean (a) with respect to the Fund,
the consolidation or amalgamation with, merger into, or transfer
of all or substantially all of its assets to, another entity,
where the Fund is not the surviving entity, and (b) with respect
to the Custodian, any consolidation or amalgamation with, merger
into, or transfer of all or substantially all of its assets to,
another entity, except for any such consolidation, amalgamation,
merger or transfer of assets between the Custodian and The Bank
of New York Company, Inc. or any subsidiary thereof, or the
Irving Bank Corporation or any subsidiary thereof, provided that
the surviving entity agrees to be bound by the terms of this
Agreement.
20. "Money Market Security" shall be deemed to
include, without limitation, debt obligations issued or
guaranteed as to principal and interest by the government of the
United States or agencies or instrumentalities thereof,
commercial paper, certificates of deposit and bankers'
acceptances, repurchase and reverse repurchase agreements with
respect to the same and bank time deposits, where the purchase
and sale of such securities normally requires settlement in
Federal funds on the same date as such purchase or sale.
21. "O.C.C." shall mean Options Clearing Corporation,
a clearing agency registered under Section 17A of the Securities
Exchange Act of 1934, its successor or successors, and its
nominee or nominees.
22. "Officers" shall be deemed to include the
President, any Vice President, the Secretary, the Treasurer, the
Controller, any Assistant Secretary, any Assistant Treasurer or
any other person or persons duly authorized by the Directors of
the Fund to execute any Certificate, instruction, notice or
other instrument on behalf of the Fund and listed in the
Certificate annexed hereto as Appendix B or such other
Certificate as may be received by the Custodian from time to
time.
23. "Option" shall mean a Call Option, Covered Call
Option, Stock Index Option and/or a Put Option.
24. "Oral Instructions" shall mean verbal
instructions actually received by the Custodian from an
Authorized Person or from a person reasonably believed by the
Custodian to be an Authorized Person.
25. "Put Option" shall mean an exchange traded option
with respect to Securities other than Stock Index Options,
Futures Contracts, and Futures Contract Options entitling the
holder, upon timely exercise and tender of the specified
underlying Securities, to sell such Securities to the writer
thereof for the exercise price.
26. "Reverse Repurchase Agreement" shall mean an
agreement pursuant to which the Fund sells Securities and agrees
to repurchase such Securities at a described or specified date
and price.
27. "Security" shall be deemed to include, without
limitation, Money Market Securities, Call Options, Put Options,
Stock Index Options, Stock Index Futures Contracts, Stock Index
Futures Contract Options, Financial Futures Contracts, Financial
Futures Contract Options, Reverse Repurchase Agreements, common
stock and other instruments or rights having characteristics
similar to common stocks, preferred stocks, debt obligations
issued by state or municipal governments and by public
authorities (including, without limitation, general obligation
bonds, revenue bonds and industrial bonds and industrial
development bonds), bonds, debentures, notes, mortgages or other
obligations, and any certificates, receipts, warrants or other
instruments representing rights to receive, purchase, sell or
subscribe for the same, or evidencing or representing any other
rights or interest therein, or any property or assets.
28. "Segregated Security Account" shall mean an
account maintained under the terms of this Agreement as a
segregated account, by recordation or otherwise, within the
custody account in which certain Securities and/or other assets
of the Fund shall be deposited and withdrawn from time to time
in accordance with Certificates received by the Custodian in
connection with such transactions as the Fund may from time to
time determine.
29. "Shares" shall mean the shares of Common Stock of
the Fund, each of which, in the case of a Fund having Series, is
allocated to a particular Series.
30. "Stock Index Futures Contract" shall mean a
bilateral agreement pursuant to which the parties agree to take
or make delivery of an amount of cash equal to a specified
dollar amount times the difference between the value of a
particular stock index at the close of the last business day of
the contract and the price at which the futures contract is
originally struck.
31. "Stock Index Option" shall mean an exchange
traded option entitling the holder, upon timely exercise, to
receive an amount of cash determined by reference to the
difference between the exercise price and the value of the index
on the date of exercise.
32. "Written Instructions" shall mean written
communications actually received by the Custodian from an
Authorized Person or from a person reasonably believed by the
Custodian to be an Authorized Person by telex or any other such
system whereby the receiver of such communications is able to
verify by codes or otherwise with a reasonable degree of
certainty the authenticity of the sender of such communication.
ARTICLE II
APPOINTMENT OF CUSTODIAN
1. The Fund hereby constitutes and appoints the
Custodian as custodian of all the Securities and moneys at any
time owned by the Fund during the period of this Agreement,
except that (a) if the Custodian fails to provide for the
custody of any of the Fund's Securities and moneys located or to
be located outside the United States in a manner satisfactory to
the Fund, the Fund shall be permitted to arrange for the custody
of such Securities and moneys located or to be located outside
the United States other than through the Custodian at rates to
be negotiated and borne by the Fund and (b) if the Custodian
fails to continue any existing sub-custodial or similar
arrangements on substantially the same terms as exist on the
date of this Agreement, the Fund shall be permitted to arrange
for such or similar services other than through the Custodian at
rates to be negotiated and borne by the Fund. The Custodian
shall not charge the Fund for any such terminated services after
the date of such termination.
2. The Custodian hereby accepts appointment as such
custodian and agrees to perform the duties thereof as
hereinafter set forth.
ARTICLE III
CUSTODY OF CASH AND SECURITIES
1. Except as otherwise provided in paragraph 7 of
this Article and in Article VIII, the Fund will deliver or cause
to be delivered to the Custodian all Securities and all moneys
owned by it, including cash received for the issuance of its
shares, at any time during the period of this Agreement. The
Custodian will not be responsible for such Securities and such
moneys until actually received by it. The Custodian will be
entitled to reverse any credits made on the Fund's behalf where
such credits have been previously made and moneys are not
finally collected. The Fund shall deliver to the Custodian a
certified resolution of the Directors of the Fund approving,
authorizing and instructing the Custodian on a continuous and
on-going basis to deposit in the Book-Entry System all
Securities eligible for deposit therein and to utilize the
Book-Entry System to the extent possible in connection with its
performance hereunder, including, without limitation, in
connection with settlements of purchases and sales of
Securities, loans of Securities, and deliveries and returns of
Securities collateral. Prior to a deposit of Securities of the
Fund in the Depository the Fund shall deliver to the Custodian a
certified resolution of the Directors of the Fund approving,
authorizing and instructing the Custodian on a continuous and
ongoing basis until instructed to the contrary by a Certificate
actually received by the Custodian to deposit in the Depository
all Securities eligible for deposit therein and to utilize the
Depository to the extent possible in connection with it's
performance hereunder, including, without limitation, in
connection with settlements of purchases and sales of
Securities, loans of Securities, and deliveries and returns of
Securities collateral. Securities and moneys of the Fund
deposited in either the Book-Entry System or the Depository will
be represented in accounts which include only assets held by the
Custodian for customers, including, but not limited to, accounts
in which the Custodian acts in a fiduciary or representative
capacity. Prior to the Custodian's accepting, utilizing and
acting with respect to Clearing Member confirmations for Options
and transactions in Options as provided in this Agreement, the
Custodian shall have received a certified resolution of the
Fund's Board of Directors approving, authorizing and instructing
the Custodian on a continuous and on-going basis, until
instructed to the contrary by a Certificate actually received by
the Custodian, to accept, utilize and act in accordance with
such confirmations as provided in this Agreement.
2. The Custodian shall credit to a separate account
in the name of the Fund all moneys received by it for the
account of the Fund, and shall disburse the same only:
(a) In payment for Securities purchased, as provided
in Article IV hereof;
(b) In payment of dividends or distributions, as
provided in Article XI hereof;
(c) In payment of original issue or other taxes, as
provided in Article XII hereof;
(d) In payment for Shares redeemed by it, as provided
in Article XII hereof;
(e) Pursuant to Certificates setting forth the name
and address of the person to whom the payment is to be made, and
the purpose for which payment is to be made; or
(f) In payment of the fees and in reimbursement of
the expenses and liabilities of the Custodian, as provided in
Article XV hereof.
3. Promptly after the close of business on each day,
the Custodian shall furnish the Fund with confirmations and a
summary of all transfers to or from the account of the Fund
during said day. Where Securities are transferred to the
account of the Fund, the Custodian shall also by book-entry or
otherwise identify as belonging to the Fund a quantity of
Securities in a fungible bulk of Securities registered in the
name of the Custodian (or its nominee) or shown on the
Custodian's account on the books of the Book-Entry System or the
Depository. At least monthly and from time to time, the
Custodian shall furnish the Fund with a detailed statement of
the Securities and moneys held for the Fund under this
Agreement.
4. Except as otherwise provided in paragraph 7 of
this Article and in Article VIII, all Securities held for the
Fund, which are issued or issuable only in bearer form, except
such Securities as are held in the Book-Entry System, shall be
held by the Custodian in that form; all other Securities held
for the Fund may be registered in the name of the Fund, in the
name of any duly appointed registered nominee of the Custodian
as the Custodian may from time to time determine, or in the name
of the Book-Entry System or the Depository or their successor or
successors, or their nominee or nominees. The Fund agrees to
furnish to the Custodian appropriate instruments to enable the
Custodian to hold or deliver in proper form for transfer, or to
register in the name of its registered nominee or in the name of
the Book-Entry System or the Depository, any Securities which it
may hold for the account of the Fund and which may from time to
time be registered in the name of the Fund. The Custodian shall
hold all such Securities which are not held in the Book-Entry
System or in the Depository in a separate account in the name of
the Fund physically segregated at all times from those of any
other person or persons.
5. Except as otherwise provided in this Agreement and
unless otherwise instructed to the contrary by a Certificate,
the Custodian by itself, or through the use of the Book-Entry
System or the Depository with respect to Securities therein
deposited, shall with respect to all Securities held for the
Fund in accordance with this Agreement:
(a) Collect all income due or payable and, in any
event, if the Custodian receives a written notice from the Fund
specifying that an amount of income should have been received by
the Custodian within the last 90 days, the Custodian will
provide a conditional payment of income within 60 days from the
date the Custodian received such notice, unless the Custodian
reasonably concludes that such income was not due or payable to
the Fund, provided that the Custodian may reverse any such
conditional payment upon its reasonably concluding that all or
any portion of such income was not due or payable, and provided
further that the Custodian shall not be liable for failing to
collect on a timely basis the full amount of income due or
payable in respect of a "floating rate instrument" or "variable
rate instrument" (as such terms are defined under Rule 2a-7
under the Investment Company Act of 1940, as amended) if it has
acted in good faith, without negligence or willful misconduct.
(b) Present for payment and collect the amount
payable upon such Securities which are called, but only if
either (i) the Custodian receives a written notice of such call,
or (ii) notice of such call appears in one or more of the
publications listed in Appendix C annexed hereto, which may be
amended at any time by the Custodian upon five business days'
prior notification to the Fund;
(c) Present for payment and collect the amount
payable upon all Securities which may mature;
(d) Surrender Securities in temporary form for
definitive Securities;
(e) Execute, as Custodian, any necessary declarations
or certificates of ownership under the Federal Income Tax Laws
or the laws or regulations of any other taxing authority now or
hereafter in effect; and
(f) Hold directly, or through the Book-Entry System
or the Depository with respect to Securities therein deposited,
for the account of the Fund all rights and similar securities
issued with respect to any Securities held by the Custodian
hereunder.
6. Upon receipt of a Certificate and not otherwise,
the Custodian, directly or through the use of the Book-Entry
System or the Depository, shall:
(a) Execute and deliver to such persons as may be
designated in such Certificate proxies, consents,
authorizations, and any other instruments whereby the authority
of the Fund as owner of any Securities may be exercised;
(b) Deliver any Securities held for the Fund in
exchange for other Securities or cash issued or paid in
connection with the liquidation, reorganization, refinancing,
merger, consolidation or recapitalization of any corporation, or
the exercise of any conversion privilege;
(c) Deliver any Securities held for the Fund to any
protective committee, reorganization committee or other person
in connection with the reorganization, refinancing, merger,
consolidation, recapitalization or sale of assets of any
corporation, and receive and hold under the terms of this
Agreement such certificates of deposit, interim receipts or
other instruments or documents as may be issued to it to
evidence such delivery;
(d) Make such transfers or exchanges of the assets of
the Fund and take such other steps as shall be stated in said
order to be for the purpose of effectuating any duly authorized
plan of liquidation, reorganization, merger, consolidation or
recapitalization of the Fund; and
(e) Present for payment and collect the amount
payable upon Securities not described in preceding paragraph
5(b) of this Article which may be called as specified in the
Certificate.
7. Notwithstanding any provision elsewhere contained
herein, the Custodian shall not be required to obtain possession
of any instrument or certificate representing any Futures
Contract, Option or Futures Contract Option until after it shall
have determined, or shall have received a Certificate from the
Fund stating, that any such instruments or certificates are
available. The Fund shall deliver to the Custodian such a
Certificate no later than the business day preceding the
availability of any such instrument or certificate. Prior to
such availability, the Custodian shall comply with Section 17(f)
of the Investment Company Act of 1940, as amended, in connection
with the purchase, sale, settlement, closing out or writing of
Futures Contracts, Options or Futures Contract Options by making
payments or deliveries specified in Certificates received by the
Custodian in connection with any such purchase, sale, writing,
settlement or closing out upon its receipt from a broker, dealer
or futures commission merchant of a statement or confirmation
reasonably believed by the Custodian to be in the form
customarily used by brokers, dealers, or futures commission
merchants with respect to such Futures Contracts, Options or
Futures Contract Options, as the case may be, confirming that
such Security is held by such broker, dealer or futures
commission merchant, in book-entry form or otherwise, in the
name of the Custodian (or any nominee of the Custodian) as
custodian for the Fund, provided, however, that payments to or
deliveries from the Margin Account shall be made in accordance
with the terms and conditions of the Margin Account Agreement.
Whenever any such instruments or certificates are available, the
Custodian shall, notwithstanding any provision in this Agreement
to the contrary, make payment for any Futures Contract, Option
or Futures Contract Option for which such instruments or such
certificates are available only against the delivery to the
Custodian of such instrument or such certificate, and deliver
any Futures Contract, Option or Futures Contract Option for
which such instruments or such certificates are available only
against receipt by the Custodian of payment therefor. Any such
instrument or certificate delivered to the Custodian shall be
held by the Custodian hereunder in accordance with, and subject
to, the provisions of this Agreement.
ARTICLE IV
PURCHASE AND SALE OF INVESTMENTS OF THE FUND OTHER THAN OPTIONS,
FUTURES CONTRACTS, FUTURES CONTRACT OPTIONS AND REVERSE
REPURCHASE AGREEMENTS
1. Promptly after each purchase of Securities by the
Fund, other than a purchase of any Option, Futures Contract,
Futures Contract Option or Reverse Repurchase Agreement, the
Fund shall deliver to the Custodian (i) with respect to each
purchase of Securities which are not Money Market Securities, a
Certificate, and (ii) with respect to each purchase of Money
Market Securities, a Certificate, Oral Instructions or Written
Instructions, specifying with respect to each such purchase:
(a) the name of the issuer and the title of the Securities; (b)
the number of shares or the principal amount purchased and
accrued interest, if any; (c) the date of purchase and
settlement; (d) the purchase price per unit; (e) the total
amount payable upon such purchase; (f) the name of the person
from whom or the broker through whom the purchase was made, and
the name of the clearing broker, if any; and (g) the name of the
broker to which payment is to be made. The Custodian shall,
upon receipt of Securities purchased by or for the Fund, pay out
of the moneys held for the account of the Fund the total amount
payable to the person from whom, or the broker through whom, the
purchase was made, provided that the same conforms to the total
amount payable as set forth in such Certificate, Oral
Instructions or Written Instructions.
2. Promptly after each sale of Securities by the
Fund, other than a sale of any Option, Futures Contract, Futures
Contract Option or Reverse Repurchase Agreement, the Fund shall
deliver to the Custodian (i) with respect to each sale of
Securities which are not Money Market Securities, a Certificate,
and (ii) with respect to each sale of Money Market Securities, a
Certificate, Oral Instructions or Written Instructions,
specifying with respect to each such sale: (a) the name of the
issuer and the title of the Security; (b) the number of shares
or principal amount sold, and accrued interest, if any; (c) the
date of sale; (d) the sale price per unit; (e) the total amount
payable to the Fund upon such sale; (f) the name of the broker
through whom or the person to whom the sale was made, and the
name of the clearing broker, if any; and (g) the name of the
broker to whom the Securities are to be delivered. The
Custodian shall deliver the Securities upon receipt of the total
amount payable to the Fund upon such sale, provided that the
same conforms to the total amount payable as set forth in such
Certificate, Oral Instructions or Written Instructions. Subject
to the foregoing, the Custodian may accept payment in such form
as shall be satisfactory to it, and may deliver Securities and
arrange for payment in accordance with the customs prevailing
among dealers in Securities.
ARTICLE V
OPTIONS
1. Promptly after the purchase of any Option by the
Fund, the Fund shall deliver to the Custodian a Certificate
specifying with respect to each Option purchased: (a) the type
of Option (put or call); (b) the name of the issuer and the
title and number of shares subject to such Option or, in the
case of a Stock Index Option, the stock index to which such
Option relates and the number of Stock Index Options purchased;
(c) the expiration date; (d) the exercise price; (e) the dates
of purchase and settlement; (f) the total amount payable by the
Fund in connection with such purchase; (g) the name of the
Clearing Member through which such Option was purchased; and (h)
the name of the broker to whom payment is to be made. The
Custodian shall pay, upon receipt of a Clearing Member's
statement confirming the purchase of such Option held by such
Clearing Member for the account of the Custodian (or any duly
appointed and registered nominee of the Custodian) as custodian
for the Fund, out of moneys held for the account of the Fund,
the total amount payable upon such purchase to the Clearing
Member through whom the purchase was made, provided that the
same conforms to the total amount payable as set forth in such
Certificate.
Promptly after the sale of any Option purchased by
the Fund pursuant to paragraph l hereof, the Fund shall deliver
to the Custodian a Certificate specifying with respect to each
such sale: (a) the type of Option (put or call); (b) the name
of the issuer and the title and number of shares subject to such
Option or, in the case of a Stock Index Option, the stock index
to which such Option relates and the number of Stock Index
Options sold; (c) the date of sale; (d) the sale price; (e) the
date of settlement; (f) the total amount payable to the Fund
upon such sale; and (g) the name of the Clearing Member through
which the sale was made. The Custodian shall consent to the
delivery of the Option sold by the Clearing Member which
previously supplied the confirmation described in preceding
paragraph 1 of this Article with respect to such Option against
payment to the Custodian of the total amount payable to the
Fund, provided that the same conforms to the total amount
payable as set forth in such Certificate.
3. Promptly after the exercise by the Fund of any
Call Option purchased by the Fund pursuant to paragraph 1
hereof, the Fund shall deliver to the Custodian a Certificate
specifying with respect to such Call Option: (a) the name of
the issuer and the title and number of shares subject to the
Call Option; (b) the expiration date; (c) the date of exercise
and settlement; (d) the exercise price per share; (e) the total
amount to be paid by the Fund upon such exercise; and (f) the
name of the Clearing Member through which such Call Option was
exercised. The Custodian shall, upon receipt of the Securities
underlying the Call Option which was exercised, pay out of the
moneys held for the account of the Fund the total amount payable
to the Clearing Member through whom the Call Option was
exercised, provided that the same conforms to the total amount
payable as set forth in such Certificate.
4. Promptly after the exercise by the Fund of any Put
Option purchased by the Fund pursuant to paragraph 1 hereof, the
Fund shall deliver to the Custodian a Certificate specifying
with respect to such Put Option: (a) the name of the issuer and
the title and number of shares subject to the Put Option; (b)
the expiration date; (c) the date of exercise and settlement;
(d) the exercise price per share; (e) the total amount to be
paid to the Fund upon such exercise; and (f) the name of the
Clearing Member through which such Put Option was exercised.
The Custodian shall, upon receipt of the amount payable upon the
exercise of the Put Option, deliver or direct the Depository to
deliver the Securities, provided the same conforms to the amount
payable to the Fund as set forth in such Certificate.
5. Promptly after the exercise by the Fund of any
Stock Index Option purchased by the Fund pursuant to paragraph 1
hereof, the Fund shall deliver to the Custodian a Certificate
specifying with respect to such Stock Index Option: (a) the
type of Stock Index Option (put or call); (b) the number of
Options being exercised; (c) the stock index to which such
Option relates; (d) the expiration date; (e) the exercise price;
(f) the total amount to be received by the Fund in connection
with such exercise; and (g) the Clearing Member from which such
payment is to be received.
6. Whenever the Fund writes a Covered Call Option,
the Fund shall promptly deliver to the Custodian a Certificate
specifying with respect to such Covered Call Option: (a) the
name of the issuer and the title and number of shares for which
the Covered Call Option was written and which underlie the same;
(b) the expiration date; (c) the exercise price; (d) the premium
to be received by the Fund; (e) the date such Covered Call
Option was written; and (f) the name of the Clearing Member
through which the premium is to be received. The Custodian
shall deliver or cause to be delivered, in exchange for receipt
of the premium specified in the Certificate with respect to such
Covered Call Option, such receipts as are required in accordance
with the customs prevailing among Clearing Members dealing in
Covered Call Options and shall impose, or direct the Depository
to impose, upon the underlying Securities specified in the
Certificate such restrictions as may be required by such
receipts. Notwithstanding the foregoing, the Custodian has the
right, upon prior written notification to the Fund, at any time
to refuse to issue any receipts for Securities in the possession
of the Custodian and not deposited with the Depository
underlying a Covered Call Option.
7. Whenever a Covered Call Option written by the Fund
and described in the preceding paragraph of this Article is
exercised, the Fund shall promptly deliver to the Custodian a
Certificate instructing the Custodian to deliver, or to direct
the Depository to deliver, the Securities subject to such
Covered Call Option and specifying: (a) the name of the issuer
and the title and number of shares subject to the Covered Call
Option; (b) the Clearing Member to whom the underlying
Securities are to be delivered; and (c) the total amount payable
to the Fund upon such delivery. Upon the return and/or
cancellation of any receipts delivered pursuant to paragraph 6
of this Article, the Custodian shall deliver, or direct the
Depository to deliver, the underlying Securities as specified in
the Certificate for the amount to be received as set forth in
such Certificate.
8. Whenever the Fund writes a Put Option, the Fund
shall promptly deliver to the Custodian a Certificate specifying
with respect to such Put Option: (a) the name of the issuer and
the title and number of shares for which the Put Option is
written and which underlie the same; (b) the expiration date;
(c) the exercise price; (d) the premium to be received by the
Fund; (e) the date such Put Option is written; (f ) the name of
the Clearing Member through which the premium is to be received
and to whom a Put Option guarantee letter is to be delivered;
(g) the amount of cash, and/or the amount and kind of
Securities, if any, to be deposited in the Segregated Security
Account; and (h) the amount of cash and/or the amount and kind
of Securities to be deposited into the Collateral Account. The
Custodian shall, after making the deposits into the Collateral
Account specified in the Certificate, issue a Put Option
guarantee letter substantially in the form utilized by the
Custodian on the date hereof, and deliver the same to the
Clearing Member specified in the Certificate against receipt of
the premium specified in said Certificate. Notwithstanding the
foregoing, the Custodian shall be under no obligation to issue
any Put Option guarantee letter or similar document if it is
unable to make any of the representations contained therein.
9. Whenever a Put Option written by the Fund and
described in the preceding paragraph is exercised, the Fund
shall promptly deliver to the Custodian a Certificate
specifying: (a) the name of the issuer and title and number of
shares subject to the Put Option; (b) the Clearing Member from
which the underlying Securities are to be received; (c) the
total amount payable by the Fund upon such delivery; (d) the
amount of cash and/or the amount and kind of Securities to be
withdrawn from the Collateral Account; and (e) the amount of
cash and/or the amount and kind of Securities, if any, to be
withdrawn from the Segregated Security Account. Upon the return
and/or cancellation of any Put Option guarantee letter or
similar document issued by the Custodian in connection with such
Put Option, the Custodian shall pay out of the moneys held for
the account of the Fund the total amount payable to the Clearing
Member specified in the Certificate as set forth in such
Certificate, and shall make the withdrawals specified in such
Certificate.
10. Whenever the Fund writes a Stock Index Option,
the Fund shall promptly deliver to the Custodian a Certificate
specifying with respect to such Stock Index Option: (a) whether
such Stock Index Option is a put or a call; (b) the number of
Options written; (c) the stock index to which such Option
relates; (d) the expiration date; (e) the exercise price; (f)
the Clearing Member through which such Option was written; (g)
the premium to be received by the Fund; (h) the amount of cash
and/or the amount and kind of Securities, if any, to be
deposited in the Segregated Security Account; (i) the amount of
cash and/or the amount and kind of Securities, if any, to be
deposited in the Collateral Account; and (j) the amount of cash
and/or the amount and kind of Securities, if any, to be
deposited in a Margin Account, and the name in which such
account is to be or has been established. The Custodian shall,
upon receipt of the premium specified in the Certificate, make
the deposits, if any, into the Segregated Security Account
specified in the Certificate, and either (1) deliver such
receipts, if any, which the Custodian has specifically agreed to
issue, which are in accordance with the customs prevailing among
Clearing Members in Stock Index Options and make the deposits
into the Collateral Account specified in the Certificate, or (2)
make the deposits into the Margin Account specified in the
Certificate.
11. Whenever a Stock Index Option written by the Fund
and described in the preceding paragraph of this Article is
exercised, the Fund shall promptly deliver to the Custodian a
Certificate specifying with respect to such Stock Index Option:
(a) such information as may be necessary to identify the Stock
Index Option being exercised; (b) the Clearing Member through
which such Stock Index Option is being exercised; (c) the total
amount payable upon such exercise, and whether such amount is to
be paid by or to the Fund; (d) the amount of cash and/or amount
and kind of Securities, if any, to be withdrawn from the Margin
Account; and (e) the amount of cash and/or amount and kind of
Securities, if any, to be withdrawn from the Segregated Security
Account and the amount of cash and/or the amount and kind of
Securities, if any, to be withdrawn from the Collateral Account.
Upon the return and/or cancellation of the receipt, if any,
delivered pursuant to the preceding paragraph of this Article,
the Custodian shall pay to the Clearing Member specified in the
Certificate the total amount payable, if any, as specified
therein.
12. Whenever the Fund purchases any Option identical
to a previously written Option described in paragraphs 6, 8 or
10 of this Article in a transaction expressly designated as a
"Closing Purchase Transaction" in order to liquidate its
position as a writer of an Option, the Fund shall promptly
deliver to the Custodian a Certificate specifying with respect
to the Option being purchased: (a) that the transaction is a
Closing Purchase Transaction; (b) the name of the issuer and the
title and number of shares subject to the Option, or, in the
case of a Stock Index Option, the stock index to which such
Option relates and the number of Options held; (c) the exercise
price; (d) the premium to be paid by the Fund; (e) the
expiration date; (f) the type of Option (put or call); (g) the
date of such purchase; (h) the name of the Clearing Member to
which the premium is to be paid; and (i) the amount of cash
and/or the amount and kind of Securities, if any, to be
withdrawn from the Collateral Account, a specified Margin
Account or the Segregated Security Account. Upon the
Custodian's payment of the premium and the return and/or
cancellation of any receipt issued pursuant to paragraphs 6, 8
or 10 of this Article with respect to the Option being
liquidated through the Closing Purchase Transaction, the
Custodian shall remove, or direct the Depository to remove, the
previously imposed restrictions on the Securities underlying the
Call Option.
13. Upon the expiration or exercise of, or
consummation of a Closing Purchase Transaction with respect to,
any Option purchased or written by the Fund and described in
this Article, the Custodian shall delete such Option from the
statements delivered to the Fund pursuant to paragraph 3 of
Article III herein, and upon the return and/or cancellation of
any receipts issued by the Custodian, shall make such
withdrawals from the Collateral Account, the Margin Account
and/or the Segregated Security Account as may be specified in a
Certificate received in connection with such expiration,
exercise, or consummation.
ARTICLE VI
FUTURES CONTRACTS
1. Whenever the Fund shall enter into a Futures
Contract, the Fund shall deliver to the Custodian a Certificate
specifying with respect to such Futures Contract (or with
respect to any number of identical Futures Contract(s)): (a)
the category of Futures Contract (the name of the underlying
stock index or financial instrument); (b) the number of
identical Futures Contracts entered into; (c) the delivery or
settlement date of the Futures Contract(s); (d) the date the
Futures Contract(s) was (were) entered into and the maturity
date; (e) whether the Fund is buying (going long) or selling
(going short) on such Futures Contract(s); (f) the amount of
cash and/or the amount and kind of Securities, if any, to be
deposited in the Segregated Security Account; (g) the name of
the broker, dealer or futures commission merchant through which
the Futures Contract was entered into; and (h) the amount of fee
or commission, if any, to be paid and the name of the broker,
dealer or futures commission merchant to whom such amount is to
be paid. The Custodian shall make the deposits, if any, to the
Margin Account in accordance with the terms and conditions of
the Margin Account Agreement. The Custodian shall make payment
of the fee or commission, if any, specified in the Certificate
and deposit in the Segregated Security Account the amount of
cash and/or the amount and kind of Securities specified in said
Certificate.
2. (a) Any variation margin payment or similar
payment required to be made by the Fund to a broker, dealer or
futures commission merchant with respect to an outstanding
Futures Contract shall be made by the Custodian in accordance
with the terms and conditions of the Margin Account Agreement.
(b) Any variation margin payment or similar
payment from a broker, dealer or futures commission merchant to
the Fund with respect to an outstanding Futures Contract shall
be received and dealt with by the Custodian in accordance with
the terms and conditions of the Margin Account Agreement.
3. Whenever a Futures Contract held by the custodian
hereunder is retained by the Fund until delivery or settlement
is made on such Futures Contract, the Fund shall deliver to the
Custodian a Certificate specifying: (a) the Futures Contract;
(b) with respect to a Stock Index Futures Contract, the total
cash settlement amount to be paid or received, and with respect
to a Financial Futures Contract, the Securities and/or amount of
cash to be delivered or received; (c) the broker, dealer or
futures commission merchant to or from which payment or delivery
is to be made or received; and (d) the amount of cash and/or
Securities to be withdrawn from the Segregated Security Account.
The Custodian shall make the payment or delivery specified in
the Certificate and delete such Futures Contract from the
statements delivered to the Fund pursuant to paragraph 3 of
Article III herein.
4. Whenever the Fund shall enter into a Futures
Contract to offset a Futures Contract held by the Custodian
hereunder, the Fund shall deliver to the Custodian a Certificate
specifying: (a) the items of information required in a
Certificate described in paragraph 1 of this Article, and (b)
the Futures Contract being offset. The Custodian shall make
payment of the fee or commission, if any, specified in the
Certificate and delete the Futures Contract being offset from
the statements delivered to the Fund pursuant to paragraph 3 of
Article III herein, and make such withdrawals from the
Segregated security Account as may be specified in such
Certificate. The withdrawals, if any, to be made from the
Margin Account shall be made by the Custodian in accordance with
the terms and conditions of the Margin Account Agreement.
ARTICLE VII
FUTURES CONTRACT OPTIONS
1. Promptly after the purchase of any Futures
Contract Option by the Fund, the Fund shall deliver to the
Custodian a Certificate specifying with respect to such Futures
Contract Option: (a) the type of Futures Contract Option (put
or call); (b) the type of Futures Contract and such other
information as may be necessary to identify the Futures Contract
underlying the Futures Contract Option purchased; (c) the
expiration date; (d) the exercise price; (e) the dates of
purchase and settlement; (f) the amount of premium to be paid by
the Fund upon such purchase; (g) the name of the broker or
futures commission merchant through which such option was
purchased; and (h) the name of the broker or futures commission
merchant to whom payment is to be made. The Custodian shall pay
the total amount to be paid upon such purchase to the broker or
futures commission merchant through whom the purchase was made,
provided that the same conforms to the amount set forth in such
Certificate.
2. Promptly after the sale of any Futures Contract
Option purchased by the Fund pursuant to paragraph 1 hereof, the
Fund shall promptly deliver to the Custodian a Certificate
specifying with respect to each such sale: (a) the type of
Futures Contract Option (put or call); (b) the type of Futures
Contract and such other information as may be necessary to
identify the Futures Contract underlying the Futures Contract
Option; (c) the date of sale; (d) the sale price; (e) the date
of settlement; (f) the total amount payable to the Fund upon
such sale; and (g) the name of the broker or futures commission
merchant through which the sale was made. The Custodian shall
consent to the cancellation of the Futures Contract Option being
closed against payment to the Custodian of the total amount
payable to the Fund, provided the same conforms to the total
amount payable as set forth in such Certificate.
3. Whenever a Futures Contract Option purchased by
the Fund pursuant to paragraph 1 is exercised by the Fund, the
Fund shall promptly deliver to the Custodian a Certificate
specifying: (a) the particular Futures Contract Option (put or
call) being exercised; (b) the type of Futures Contract
underlying the Futures Contract Option; (c) the date of
exercise; (d) the name of the broker or futures commission
merchant through which the Futures Contract Option is exercised;
(e) the net total amount, if any, payable by the Fund; (f) the
amount, if any, to be received by the Fund; and (g) the amount
of cash and/or the amount and kind of Securities to be deposited
in the Segregated Security Account. The Custodian shall make
the payments, if any, and the deposits, if any, into the
Segregated Security Account as specified in the Certificate.
The deposits, if any, to be made to the Margin Account shall be
made by the Custodian in accordance with the terms and
conditions of the Margin Account Agreement.
4. Whenever the Fund writes a Futures Contract
Option, the Fund shall promptly deliver to the Custodian a
Certificate specifying with respect to such Futures Contract
Option: (a) the type of Futures Contract Option (put or call);
(b) the type of Futures Contract and such other information as
may be necessary to identify the Futures Contract underlying the
Futures Contract Option; (c) the expiration date; (d) the
exercise price; (e) the premium to be received by the Fund; (f)
the name of the broker or futures commission merchant through
which the premium is to be received; and (g) the amount of cash
and/or the amount and kind of Securities, if any, to be
deposited in the Segregated Security Account. The Custodian
shall, upon receipt of the premium specified in the Certificate,
make the deposits into the Segregated Security Account, if any,
as specified in the Certificate. The deposits, if any, to be
made to the Margin Account shall be made by the Custodian in
accordance with the terms and conditions of the Margin Account
Agreement.
5. Whenever a Futures Contract Option written by the
Fund which is a call is exercised, the Fund shall promptly
deliver to the Custodian a Certificate specifying: (a) the
particular Futures Contract Option exercised; (b) the type of
Futures Contract underlying the Futures Contract Option; (c) the
name of the broker or futures commission merchant through which
such Futures Contract Option was exercised; (d) the net total
amount, if any, payable to the Fund upon such exercise; (e) the
net total amount, if any, payable by the Fund upon such
exercise; and (f) the amount of cash and/or the amount and kind
of Securities to be deposited in the Segregated Security
Account. The Custodian shall, upon its receipt of the net total
amount payable to the Fund, if any, specified in such
Certificate make the payments, if any, and the deposits, if any,
into the Segregated Security Account as specified in the
Certificate. The deposits, if any, to be made to the Margin
Account shall be made by the Custodian in accordance with the
terms and conditions of the Margin Account Agreement.
6. Whenever a Futures Contract Option which is
written by the Fund and which is a Put Option is exercised, the
Fund shall promptly deliver to the Custodian a Certificate
specifying: (a) the particular Futures Contract Option
exercised; (b) the type of Futures Contract underlying such
Futures Contract Option; (c) the name of the broker or futures
commission merchant through which such Futures Contract Option
is exercised; (d) the net total amount, if any, payable to the
Fund upon such exercise; (e) the net total amount, if any,
payable by the Fund upon such exercise; and (f) the amount and
kind of Securities and/or cash to be withdrawn from or deposited
in the Segregated Security Account, if any. The Custodian
shall, upon its receipt of the net total amount payable to the
Fund, if any, specified in the Certificate, make the payments,
if any, and the deposits, if any, into the Segregated Security
Account as specified in the Certificate. The deposits to and/or
withdrawals from the Margin Account, if any, shall be made by
the Custodian in accordance with the terms and conditions of the
Margin Account Agreement.
7. Whenever the Fund purchases any Futures Contract
Option identical to a previously written Futures Contract Option
described in this Article in order to liquidate its position as
a writer of such Futures Contract Option, the Fund shall
promptly deliver to the Custodian a Certificate specifying with
respect to the Futures Contract Option being purchased: (a)
that the transaction is a closing transaction; (b) the type of
Futures Contract and such other information as may be necessary
to identify the Futures Contract underlying the Futures Contract
Option; (c) the exercise price; (d) the premium to be paid by
the Fund; (e) the expiration date; (f) the name of the broker or
futures commission merchant to which the premium is to be paid;
and (g) the amount of cash and/or the amount and kind of
Securities, if any, to be withdrawn from the Segregated Security
Account. The Custodian shall effect the withdrawals from the
Segregated Security Account specified in the Certificate. The
withdrawals, if any, to be made from the Margin Account shall be
made by the Custodian in accordance with the terms and
conditions of the Margin Account Agreement.
8. Upon the expiration or exercise of, or
consummation of a closing transaction with respect to, any
Futures Contract Option written or purchased by the Fund and
described in this Article, the Custodian shall (a) delete such
Futures Contract Option from the statements delivered to the
Fund pursuant to paragraph 3 of Article III herein, and (b) make
such withdrawals from, and/or, in the case of an exercise, such
deposits into, the Segregated Security Account as may be
specified in a Certificate. The deposits to and/or withdrawals
from the Margin Account, if any, shall be made by the Custodian
in accordance with the terms and conditions of the Margin
Account Agreement.
9. Futures Contracts acquired by the Fund through the
exercise of a Futures Contract Option described in this Article
shall be subject to Article VI hereof.
ARTICLE VIII
SHORT SALES
1. Promptly after any short sale, the Fund shall
deliver to the Custodian a Certificate specifying: (a) the name
of the issuer and the title of the Security; (b) the number of
shares or principal amount sold, and accrued interest or
dividends, if any; (c) the dates of the sale and settlement; (d)
the sale price per unit; (e) the total amount credited to the
Fund upon such sales, if any; (f) the amount of cash and/or the
amount and kind of Securities, if any, which are to be deposited
in a Margin Account and the name in which such Margin Account
has been or is to be established; (g) the amount of cash and/or
the amount and kind of Securities, if any, to be deposited in a
Segregated Security Account; and (h) the name of the broker
through which such short sale was made. The Custodian shall
upon its receipt of a statement from such broker confirming such
sale and that the total amount credited to the Fund upon such
sale, if any, as specified in the Certificate is held by such
broker for the account of the Custodian (or any nominee of the
Custodian) as custodian of the Fund, issue a receipt or make the
deposits into the Margin Account and the Segregated Security
Account specified in the Certificate.
2. In connection with the closing-out of any short
sale, the Fund shall promptly deliver to the Custodian a
Certificate specifying with respect to each such closing-out:
(a) the name of the issuer and the title of the Security; (b)
the number of shares or the principal amount, and accrued
interest or dividends, if any, required to effect such
closing-out to be delivered to the broker; (c) the dates of the
closing-out and settlement; (d) the purchase price per unit; (e)
the net total amount payable to the Fund upon such closing-out;
(f) the net total amount payable to the broker upon such
closing-out; (g) the amount of cash and the amount and kind of
Securities to be withdrawn, if any, from the Margin Account; (h)
the amount of cash and/or the amount and kind of Securities, if
any, to be withdrawn from the Segregated Security Account; and
(i) the name of the broker through which the Fund is effecting
such closing-out. The Custodian shall, upon receipt of the net
total amount payable to the Fund upon such closing-out and the
return and/or cancellation of the receipts, if any, issued by
the custodian with respect to the short sale being closed-out,
pay out of the moneys held for the account of the Fund to the
broker the net total amount payable to the broker, and make the
withdrawals from the Margin Account and the Segregated Security
Account, as the same are specified in the Certificate.
ARTICLE IX
REVERSE REPURCHASE AGREEMENTS
1. Promptly after the Fund enters into a Reverse
Repurchase Agreement with respect to Securities and money held
by the Custodian hereunder, the Fund shall deliver to the
Custodian a Certificate or in the event such Reverse Repurchase
Agreement is a Money Market Security, a Certificate, Oral
Instructions or Written Instructions specifying: (a) the total
amount payable to the Fund in connection with such Reverse
Repurchase Agreement; (b) the broker or dealer through or with
which the Reverse Repurchase Agreement is entered; (c) the
amount and kind of Securities to be delivered by the Fund to
such broker or dealer; (d) the date of such Reverse Repurchase
Agreement; and (e) the amount of cash and/or the amount and kind
of Securities, if any, to be deposited in a Segregated Security
Account in connection with such Reverse Repurchase Agreement.
The Custodian shall, upon receipt of the total amount payable to
the Fund specified in the Certificate, Oral Instructions or
Written Instructions make the delivery to the broker or dealer,
and the deposits, if any, to the Segregated Security Account,
specified in such Certificate, Oral Instructions or Written
Instructions.
2. Upon the termination of a Reverse Repurchase
Agreement described in paragraph 1 of this Article, the Fund
shall promptly deliver a Certificate or, in the event such
Reverse Repurchase Agreement is a Money Market Security, a
Certificate, Oral Instructions or Written Instructions to the
Custodian specifying: (a) the Reverse Repurchase Agreement
being terminated; (b) the total amount payable by the Fund in
connection with such termination; (c) the amount and kind of
Securities to be received by the Fund in connection with such
termination; (d) the date of termination; (e) the name of the
broker or dealer with or through which the Reverse Repurchase
Agreement is to be terminated; and (f) the amount of cash and/or
the amount and kind of Securities to be withdrawn from the
Segregated Security Account. The Custodian shall, upon receipt
of the amount and kind of Securities to be received by the Fund
specified in the Certificate, Oral Instructions or Written
Instructions, make the payment to the broker or dealer, and the
withdrawals, if any, from the Segregated Security Account,
specified in such Certificate, Oral Instructions or Written
Instructions.
ARTICLE X
CONCERNING MARGIN ACCOUNTS, SEGREGATED SECURITY
ACCOUNTS AND COLLATERAL ACCOUNTS
1. The Custodian shall, from time to time, make such
deposits to, or withdrawals from, a Segregated Security Account
as specified in a Certificate received by the Custodian. Such
Certificate shall specify the amount of cash and/or the amount
and kind of Securities to be deposited in, or withdrawn from,
the Segregated Security Account. In the event that the Fund
fails to specify in a Certificate the name of the issuer, the
title and the number of shares or the principal amount of any
particular Securities to be deposited by the Custodian into, or
withdrawn from, a Segregated Securities Account, the Custodian
shall be under no obligation to make any such deposit or
withdrawal and shall no notify the Fund.
2. The custodian shall make deliveries or payments
from a Margin Account to the broker, dealer, futures commission
merchant or Clearing Member in whose name, or for whose benefit,
the account was established as specified in the Margin Account
Agreement.
3. Amounts received by the Custodian as payments or
distributions with respect to Securities deposited in any Margin
Account shall be dealt with in accordance with the terms and
conditions of the Margin Account Agreement.
4. The Custodian shall have a continuing lien and
security interest in and to any property at any time held by the
Custodian in any Collateral Account described herein. In
accordance with applicable law, the Custodian may enforce its
lien and realize on any such property whenever the Custodian has
made payment or delivery pursuant to any Put Option guarantee
letter or similar document or any receipt issued hereunder by
the Custodian. In the event the Custodian should realize on any
such property net proceeds which are less than the Custodian's
obligations under any Put Option guarantee letter or similar
document or any receipt, such deficiency shall be a debt owed
the Custodian by the Fund within the scope of Article XIII
herein.
5. On each business day, the Custodian shall furnish
the Fund with a statement with respect to each Margin Account in
which money or Securities are held specifying as of the close of
business on the previous business day: (a) the name of the
Margin Account; (b) the amount and kind of Securities held
therein; and (c) the amount of money held therein. The
Custodian shall make available upon request to any broker,
dealer or futures commission merchant specified in the name of a
Margin Account a copy of the statement furnished the Fund with
respect to such Margin Account.
6. Promptly after the close of business on each
business day in which cash and/or Securities are maintained in a
Collateral Account, the Custodian shall furnish the Fund with a
Statement with respect to such Collateral Account specifying the
amount of cash and/or the amount and kind of Securities held
therein. No later than the close of business next succeeding
the delivery to the Fund of such statement, the Fund shall
furnish to the Custodian a Certificate or Written Instructions
specifying the then market value of the securities described in
such statement. In the event such then market value is
indicated to be less than the Custodian's obligation with
respect to any outstanding Put Option, guarantee letter or
similar document, the Fund shall promptly specify in a
Certificate the additional cash and/or Securities to be
deposited in such Collateral Account to eliminate such
deficiency.
ARTICLE XI
PAYMENT OF DIVIDENDS OR DISTRIBUTIONS
1. The Fund shall furnish to the Custodian a copy of
the resolution of the Directors, certified by the Secretary or
any Assistant Secretary, either (i) setting forth the date of
the declaration of a dividend or distribution, the date of
payment thereof, the record date as of which shareholders
entitled to payment shall be determined, the amount payable per
share to the shareholders of record as of that date and the
total amount payable to the Dividend Agent of the Fund on the
payment date, or (ii) authorizing the declaration of dividends
and distributions on a daily basis and authorizing the Custodian
to rely on Oral Instructions, Written Instructions or a
Certificate setting forth the date of the declaration of such
dividend or distribution, the date of payment thereof, the
record date as of which shareholders entitled to payment shall
be determined, the amount payable per share to the shareholders
of record as of that date and the total amount payable to the
Dividend Agent on the payment date.
2. Upon the payment date specified in such
resolution, Oral Instructions, Written Instructions or
Certificate, as the case may be, the Custodian shall pay out of
the moneys held for the account of the Fund the total amount
payable to the Dividend Agent of the Fund.
ARTICLE XII
SALE AND REDEMPTION OF SHARES OF COMMON STOCK
1. Whenever the Fund shall sell any of its Shares, it
shall deliver to the Custodian a Certificate duly specifying:
(a) The number of Shares sold, trade date, and price;
and
(b) The amount of money to be received by the
Custodian for the sale of such Shares.
2. Upon receipt of such money from the Transfer
Agent, the Custodian shall credit such money to the account of
the Fund.
3. Upon issuance of any of the Fund's Shares in
accordance with the foregoing provisions of this Article, the
Custodian shall pay, out of the money held for the account of
the Fund, all original issue or other taxes required to be paid
by the Fund in connection with such issuance upon the receipt of
a Certificate specifying the amount to be paid.
4. Except as provided hereinafter, whenever the Fund
shall hereafter redeem any of its Shares, it shall furnish to
the Custodian a Certificate specifying:
(a) The number of Shares redeemed; and
(b) The amount to be paid for the Shares redeemed.
5. Upon receipt from the Transfer Agent of an advice
setting forth the number of Shares received by the Transfer
Agent for redemption and that such Shares are valid and in good
form for redemption, the Custodian shall make payment to the
Transfer Agent out of the moneys held for the account of the
Fund of the total amount specified in the Certificate issued
pursuant to the foregoing paragraph 4 of this Article.
6. Notwithstanding the above provisions regarding the
redemption of any of the Fund's Shares, whenever its Shares are
redeemed pursuant to any check redemption privilege which may
from time to time be offered by the Fund, the Custodian, unless
otherwise instructed by a Certificate, shall, upon receipt of an
advice from the Fund or its agent setting forth that the
redemption is in good form for redemption in accordance with the
check redemption procedure, honor the check presented as part of
such check redemption privilege out of the money held in the
account of the Fund for such purposes.
ARTICLE XIII
OVERDRAFTS OR INDEBTEDNESS
1. If the Custodian should in its sole discretion
advance funds on behalf of the Fund which results in an
overdraft because the moneys held by the Custodian for the
account of the Fund shall be insufficient to pay the total
amount payable upon a purchase of Securities as set forth in a
Certificate or Oral Instructions issued pursuant to Article IV,
or which results in an overdraft for some other reason, or if
the Fund is for any other reason indebted to the Custodian
(except a borrowing for investment or for temporary or emergency
purposes using Securities as collateral pursuant to a separate
agreement and subject to the provisions of paragraph 2 of this
Article XIII), such overdraft or indebtedness shall be deemed to
be a loan made by the Custodian to the Fund payable on demand
and shall bear interest from the date incurred at a rate per
annum (based on a 360-day year for the actual number of days
involved) equal to the Federal Funds Rate plus 1/2%, such rate
to be adjusted on the effective date of any change in such
Federal Funds Rate but in no event to be less than 6% per annum,
except that any overdraft resulting from an error by the
Custodian shall bear no interest. Any such overdraft or
indebtedness shall be reduced by an amount equal to the total of
all amounts due the Fund which have not been collected by the
Custodian on behalf of the Fund when due because of the failure
of the Custodian to make timely demand or presentment for
payment. In addition, the Fund hereby agrees that the Custodian
shall have a continuing lien and security interest in and to any
property at any time held by it for the benefit of the Fund or
in which the Fund may have an interest which is then in the
Custodian's possession or control or in possession or control of
any third party acting in the Custodian's behalf. The Fund
authorizes the Custodian, in its sole discretion, at any time to
charge any such overdraft or indebtedness together with interest
due thereon against any balance of account standing to the
Fund's credit on the Custodian's books. For purposes of this
Section 1 of Article XIII, "overdraft" shall mean a negative
Available Balance.
2. The Fund will cause to be delivered to the
Custodian by any bank (including, if the borrowing is pursuant
to a separate agreement, the Custodian) from which it borrows
money for investment or for temporary or emergency purposes
using Securities as collateral for such borrowings, a notice or
undertaking in the form currently employed by any such bank
setting forth the amount which such bank will loan to the Fund
against delivery of a stated amount of collateral. The Fund
shall promptly deliver to the Custodian a Certificate specifying
with respect to each such borrowing: (a) the name of the bank;
(b) the amount and terms of the borrowing, which may be set
forth by incorporating by reference an attached promissory note,
duly endorsed by the Fund, or other loan agreement; (c) the time
and date, if known, on which the loan is to be entered into; (d)
the date on which the loan becomes due and payable; (e) the
total amount payable to the Fund on the borrowing date; (f) the
market value of Securities to be delivered as collateral for
such loan, including the name of the issuer, the title and the
number of shares or the principal amount of any particular
Securities; and (g) a statement specifying whether such loan is
for investment purposes or for temporary or emergency purposes
and that such loan is in conformance with the Investment Company
Act of 1940 and the Fund's prospectus. The Custodian shall
deliver on the borrowing date specified in a Certificate the
specified collateral and the executed promissory note, if any,
against delivery by the lending bank of the total amount of the
loan payable, provided that the same conforms to the total
amount payable as set forth in the Certificate. The Custodian
may, at the option of the lending bank, keep such collateral in
its possession, but such collateral shall be subject to all
rights therein given the lending bank by virtue of any
promissory note or loan agreement. The Custodian shall deliver
such Securities as additional collateral as may be specified in
a Certificate to collateralize further any transaction described
in this paragraph. The Fund shall cause all Securities released
from collateral status to be returned directly to the Custodian,
and the Custodian shall receive from time to time such return of
collateral as may be tendered to it. In the event that the Fund
fails to specify in a Certificate the name of the issuer, the
title and number of shares or the principal amount of any
particular Securities to be delivered as collateral by the
Custodian, the Custodian shall not be under any obligation to
deliver any Securities.
ARTICLE XIV
LOAN OF PORTFOLIO SECURITIES OF THE FUND
1. If the Fund is permitted by the terms of its
Articles of Incorporation and as disclosed in its most recent
and currently effective prospectus to lend its portfolio
Securities, within 24 hours after each loan of portfolio
Securities the Fund shall deliver or cause to be delivered to
the Custodian a Certificate specifying with respect to each such
loan: (a) the name of the issuer and the title of the
Securities; (b) the number of shares or the principal amount
loaned; (c) the date of loan and delivery; (d) the total amount
to be delivered to the Custodian against the loan of the
Securities, including the amount of cash collateral and the
premium, if any, separately identified; and (e) the name of the
broker, dealer or financial institution to which the loan was
made. The Custodian shall deliver the Securities thus
designated to the broker, dealer or financial institution to
which the loan was made upon receipt of the total amount
designated as to be delivered against the loan of Securities.
The Custodian may accept payment in connection with a delivery
otherwise than through the Book-Entry System or Depository only
in the form of a certified or bank cashier's check payable to
the order of the Fund or the Custodian drawn on New York
Clearing House funds and may deliver Securities in accordance
with the customs prevailing among dealers in securities.
2. Promptly after each termination of the loan of
Securities by the Fund, the Fund shall deliver or cause to be
delivered to the Custodian a Certificate specifying with respect
to each such loan termination and return of Securities: (a) the
name of the issuer and the title of the Securities to be
returned; (b) the number of shares or the principal amount to be
returned; (c) the date of termination; (d) the total amount to
be delivered by the Custodian (including the cash collateral for
such Securities minus any offsetting credits as described in
said Certificate); and (e) the name of the broker, dealer or
financial institution from which the Securities will be
returned. The Custodian shall receive all Securities returned
from the broker, dealer, or financial institution to which such
Securities were loaned and upon receipt thereof shall pay, out
of the moneys held for the account of the Fund, the total amount
payable upon such return of Securities as set forth in the
Certificate.
ARTICLE XV
CONCERNING THE CUSTODIAN
1. Except as hereinafter provided, neither the
Custodian nor its nominee shall be liable for any loss or
damage, including counsel fees, resulting from its action or
omission to act or otherwise, either hereunder or under any
Margin Account Agreement, except for any such loss or damage
arising out of its own negligence or willful misconduct. The
Custodian may, with respect to questions of law arising
hereunder or under any Margin Account Agreement, apply for and
obtain the advice and opinion of counsel to the Fund or of its
own counsel, at the expense of the Fund, and shall be fully
protected with respect to anything done or omitted by it in good
faith in conformity with such advice or opinion. The Custodian
shall be liable to the Fund for any loss or damage resulting
from the use of the Book-Entry System or any Depository arising
by reason of any negligence, misfeasance or willful misconduct
on the part of the Custodian or any of its employees or agents.
2. Without limiting the generality of the foregoing,
the Custodian shall be under no obligation to inquire into, and
shall not be liable for:
(a) The validity of the issue of any Securities
purchased, sold or written by or for the Fund, the legality of
the purchase, sale or writing thereof, or the propriety of the
amount paid or received therefor;
(b) The legality of the issue or sale of any of the
Fund's Shares, or the sufficiency of the amount to be received
therefor;
(c) The legality of the redemption of any of the
Fund's Shares, or the propriety of the amount to be paid
therefor;
(d) The legality of the declaration or payment of any
dividend by the Fund;
(e) The legality of any borrowing by the Fund using
Securities as collateral;
The legality of any loan of portfolio Securities
pursuant to Article XIV of this Agreement, nor shall the
Custodian be under any duty or obligation to see to it that any
cash collateral delivered to it by a broker, dealer or financial
institution or held by it at any time as a result of such loan
of portfolio Securities of the Fund is adequate collateral for
the Fund against any loss it might sustain as a result of such
loan. The Custodian specifically, but not by way of limitation,
shall not be under any duty or obligation periodically to check
or notify the Fund that the amount of such cash collateral held
by it for the Fund is sufficient collateral for the Fund, but
such duty or obligation shall be the sole responsibility of the
Fund. In addition, the Custodian shall be under no duty or
obligation to see that any broker, dealer or financial
institution to which portfolio Securities of the Fund are lent
pursuant to Article XIV of this Agreement makes payment to it of
any dividends or interest which are payable to or for the
account of the Fund during the period of such loan or at the
termination of such loan, provided, however, that the Custodian
shall promptly notify the Fund in the event that such dividends
or interest are not paid and received when due; or
(g) The sufficiency or value of any amounts of money
and/or Securities held in any Margin Account, Segregated
Security Account or Collateral Account in connection with
transactions by the Fund. In addition, the Custodian shall be
under no duty or obligation to see that any broker, dealer,
futures commission merchant or Clearing Member makes payment to
the Fund of any variation margin payment or similar payment
which the Fund may be entitled to receive from such broker,
dealer, futures commission merchant or Clearing Member, to see
that any payment received by the Custodian from any broker,
dealer, futures commission merchant or Clearing Member is the
amount the Fund is entitled to receive, or to notify the Fund of
the Custodian's receipt or non-receipt of any such payment;
provided however that the Custodian, upon the Fund's written
request, shall, as Custodian, demand from any broker, dealer,
futures commission merchant or Clearing Member identified by the
Fund the payment of any variation margin payment or similar
payment that the Fund asserts it is entitled to receive pursuant
to the terms of a Margin Account Agreement or otherwise from
such broker, dealer, futures commission merchant or Clearing
Member.
3. The Custodian shall not be liable for, or
considered to be the Custodian of, any money, whether or not
represented by any check, draft or other instrument for the
payment of money, received by it on behalf of the Fund until the
Custodian actually receives and collects such money directly or
by the final crediting of the account representing the Fund's
interest at the Book-Entry System or the Depository.
4. The Custodian shall have no responsibility and
shall not be liable for ascertaining or acting upon any calls,
conversions, exchange, offers, tenders, interest rate changes or
similar matters relating to Securities held in the Depository,
unless the Custodian shall have actually received timely notice
from the Depository. In no event shall the Custodian have any
responsibility or liability for the failure of the Depository to
collect, or for the late collection or late crediting by the
Depository of any amount payable upon Securities deposited in
the Depository which may mature or be redeemed, retired, called
or otherwise become payable. However, upon receipt of a
Certificate from the Fund of an overdue amount on Securities
held in the Depository, the Custodian shall make a claim against
the Depository on behalf of the Fund, except that the Custodian
shall not be under any obligation to appear in, prosecute or
defend any action, suit or proceeding in respect to any
Securities held by the Depository which in its opinion may
involve it in expense or liability, unless indemnity
satisfactory to it against all expense and liability be
furnished as often as may be required.
5. The Custodian shall not be under any duty or
obligation to take action to effect collection of any amount due
to the Fund from the Transfer Agent of the Fund nor to take any
action to effect payment or distribution by the Transfer Agent
of the Fund of any amount paid by the Custodian to the Transfer
Agent of the Fund in accordance with this Agreement.
6. The Custodian shall not be under any duty or
obligation to take action to effect collection of any amount, if
the Securities upon which such amount is payable are in default,
or if payment is refused after due demand or presentation,
unless and until (i) it shall be directed to take such action by
a Certificate and (ii) it shall be assured to its satisfaction
of reimbursement of its costs and expenses in connection with
any such action.
7. The Custodian may appoint one or more banking
institutions as Depository or Depositories or as Sub-Custodian
or Sub-Custodians, including, but not limited to, banking
institutions located in foreign countries, of Securities and
moneys at any time owned by the Fund, upon terms and conditions
approved in a Certificate, which shall, if requested by the
Custodian, be accompanied by an approving resolution of the
Fund's Board of Directors adopted in accordance with Rule 17f-5
under the Investment Company Act of 1940, as amended.
8. The Custodian shall not be under any duty or
obligation to ascertain whether any Securities at any time
delivered to or held by it for the account of the Fund are such
as properly may be held by the Fund under the provisions of its
Articles of Incorporation.
9. (a) The Custodian shall be entitled to receive
and the Fund agrees to pay to the Custodian all reasonable
out-of-pocket expenses and such compensation and fees as are
specified on Schedule A hereto. The Custodian shall not deem
amounts payable in respect of foreign custodial services to be
out-of-pocket expenses, it being the parties' intention that all
fees for such services shall be as set forth on Schedule B
hereto and shall be provided for the term of this Agreement
without any automatic or unilateral increase. The Custodian
shall have the right to unilaterally increase the figures on
Schedule A on or after March 1, 1991 and on or after each
succeeding March 1 thereafter by an amount equal to 50% of the
increase in the Consumer Price Index for the calendar year
ending on the December 31 immediately preceding the calendar
year in which such March 1 occurs, provided, however, that
during each such annual period commencing on a March 1, the
aggregate increase during such period shall not be in excess of
10%. Any increase by the Custodian shall be specified in a
written notice delivered to the Fund at least thirty days prior
to the effective date of the increase. The Custodian may charge
such compensation and any expenses incurred by the Custodian in
the performance of its duties pursuant to such agreement against
any money held by it for the account of the Fund. The Custodian
shall also be entitled to change against any money held by it
for the account of the Fund the amount of any loss, damage,
liability or expense, including counsel fees, for which it shall
be entitled to reimbursement under the provisions of this
Agreement. The expenses which the Custodian may charge against
the account of the Fund include, but are not limited to, the
expenses of Sub-Custodians and foreign branches of the Custodian
incurred in settling outside of New York City transactions
involving the purchase and sale of Securities of the Fund.
(b) The Fund shall receive a credit for each
calendar month against such compensation and fees of the
Custodian as may be payable by the Fund with respect to such
calendar month in an amount equal to the aggregate of its
Earnings Credit for such calendar month. In no event may any
Earnings Credits be carried forward to any fiscal year other
than the fiscal year in which it was earned, or, unless
permitted by applicable law, transferred to, or utilized by, any
other person or entity, provided that any such transferred
Earnings Credit can be used only to offset compensation and fees
of the Custodian for services rendered to such transferee and
cannot be used to pay the Custodian's out-of-pocket expenses.
For purposes of this subsection (b), the Fund is permitted to
transfer Earnings Credits only to The Dreyfus Corporation, its
affiliates and/or any investment company now or in the future
sponsored by The Dreyfus Corporation or any of its affiliates or
for which The Dreyfus Corporation or any of its affiliates acts
as the sole investment adviser or as the principal distributor,
and Daiwa Money Fund Inc. For purposes of this sub-section (b),
a fiscal year shall mean the twelve-month period commencing on
the effective date of this Agreement and on each anniversary
thereof.
10. The Custodian shall be entitled to rely upon any
Certificate, notice or other instrument in writing received by
the Custodian and reasonably believed by the Custodian to be a
Certificate. The Custodian shall be entitled to rely upon any
Oral Instructions and any Written Instructions actually received
by the Custodian pursuant to Article IV or XI hereof. The Fund
agrees to forward to the Custodian a Certificate or facsimile
thereof, confirming such Oral Instructions or Written
Instructions in such manner so that such Certificate or
facsimile thereof is received by the Custodian, whether by hand
delivery, telex or otherwise, by the close of business of the
same day that such Oral Instructions or Written Instructions are
given to the Custodian. The Fund agrees that the fact that such
confirming instructions are not received by the Custodian shall
in no way affect the validity of the transactions or
enforceability of the transactions hereby authorized by the
Fund. The Fund agrees that the Custodian shall incur no
liability to the Fund in acting upon Oral Instructions given to
the Custodian hereunder concerning such transactions, provided
such instructions reasonably appear to have been received from
an Authorized Person.
11. The Custodian shall be entitled to rely upon any
instrument, instruction or notice received by the Custodian and
reasonably believed by the Custodian to be given in accordance
with the terms and conditions of any Margin Account Agreement.
Without limiting the generality of the foregoing, the Custodian
shall be under no duty to inquire into, and shall not be liable
for, the accuracy of any statements or representations contained
in any such instrument or other notice including, without
limitation, any specification of any amount to be paid to a
broker, dealer, futures commission merchant or Clearing Member.
12. The books and records pertaining to the Fund
which are in the possession of the Custodian shall be the
property of the Fund. Such books and records shall be prepared
and maintained as required by the Investment Company Act of
1940, as amended, and other applicable securities laws and rules
and regulations. The Fund, or the Fund's authorized
representatives, shall have access to such books and records
during the Custodian's normal business hours. Upon the
reasonable request of the Fund, copies of any such books and
records shall be provided by the Custodian to the Fund or the
Fund's authorized representative at the Fund's expense.
13. The Custodian shall provide the Fund with any
report obtained by the Custodian on the system of internal
accounting control of the Book-Entry System or the Depository,
or O.C.C., and with such reports on its own systems of internal
accounting control as the Fund may reasonably request from time
to time.
14. The Fund agrees to indemnify the Custodian
against and save the Custodian harmless from all liability,
claims, losses and demands whatsoever, including attorney's
fees, howsoever arising or incurred because of or in connection
with the Custodian's payment or non-payment of checks pursuant
to paragraph 6 of Article XII as part of any check redemption
privilege program of the Fund, except for any such liability,
claim, loss and demand arising out of the Custodian's own
negligence or willful misconduct.
15. Subject to the foregoing provisions of this
Agreement, the Custodian may deliver and receive Securities, and
receipts with respect to such Securities, and arrange for
payments to be made and received by the Custodian in accordance
with the customs prevailing from time to time among brokers or
dealers in such Securities.
16. The Custodian shall have no duties or responsibi-
lities whatsoever except such duties and responsibilities as are
specifically set forth in this Agreement, and no covenant or
obligation shall be implied in this Agreement against the
Custodian.
ARTICLE XVI
TERMINATION
1. (a) Except as provided in subparagraphs (b), (c)
and (d) herein, neither party may terminate this Agreement until
the earlier of the following: (i) August 31, 1993, and (ii) the
third anniversary of the earliest date on which none of the
companies listed on Schedule C hereto is a transfer agency
customer of the Custodian. Any such termination may be effected
only by the terminating party giving to the other party a notice
in writing specifying the date of such termination, which shall
be not less than two hundred seventy (270) days after the date
of giving of such notice.
(b) The Fund may at any time terminate this
Agreement if the Custodian has materially breached its
obligations under this Agreement and such breach has remained
uncured for a period of thirty days after the Custodian's
receipt from the Fund of written notice specifying such breach.
(c) Either party, immediately upon written
notice to the other party, may terminate this Agreement upon the
Merger or Bankruptcy of the other party.
(d) The Fund may at any time terminate this
Agreement if the Custodian has materially breached its
obligations under the "Amendment to Transfer Agency Agreements"
dated August 18, 1989 and has not cured such breach as promptly
as practicable and in any event within seven days of its receipt
of written notice of such breach, provided that the Custodian
shall not be permitted to cure any such material breach arising
from the willful misconduct of the Custodian.
In the event notice of termination is given by the
Fund, it shall be accompanied by a copy of a resolution of the
Directors of the Fund, certified by the Secretary or any
Assistant Secretary, electing to terminate this Agreement and
designating a successor custodian or custodians, each of which
shall be a bank or trust company having not less than $2,000,000
aggregate capital, surplus and undivided profits. In the event
notice of termination is given by the Custodian, the Fund shall,
on or before the termination date, deliver to the Custodian a
copy of a resolution of its Directors, certified by the
Secretary or any Assistant Secretary, designating a successor
custodian or custodians. In the absence of such designation by
the Fund, the Custodian may designate a successor custodian
which shall be a bank or trust company having not less than
$2,000,000 aggregate capital, surplus and undivided profits.
Upon the date set forth in such notice, this Agreement shall
terminate and the Custodian shall, upon receipt of a notice of
acceptance by the successor custodian, on that date deliver
directly to the successor custodian all Securities and moneys
then owned by the Fund and held by it as Custodian, after
deducting all fees, expenses and other amounts for the payment
or reimbursement of which it shall then be entitled.
2. If a successor custodian is not designated by the
Fund or the Custodian in accordance with the preceding
paragraph, the Fund shall, upon the date specified in the notice
of termination of this Agreement and upon the delivery by the
Custodian of all Securities (other than Securities held in the
Book-Entry System which cannot be delivered to the Fund) and
moneys then owned by the Fund, be deemed to be its own
custodian, and the Custodian shall thereby be relieved of all
duties and responsibilities pursuant to this Agreement, other
than the duty with respect to Securities held in the Book-Entry
System, in any Depository or by a Clearing Member which cannot
be delivered to the Fund, to hold such Securities hereunder in
accordance with this Agreement.
ARTICLE XVII
MISCELLANEOUS
1. Annexed hereto as Appendix A is a Certificate
signed by two of the present Officers of the Fund under its
seal, setting forth the names and the signatures of the present
Authorized Persons. The Fund agrees to furnish to the Custodian
a new Certificate in similar form in the event that any such
present Authorized Person ceases to be an Authorized Person or
in the event that other or additional Authorized Persons are
elected or appointed. Until such new Certificate shall be
received, the Custodian shall be fully protected in acting under
the provisions of this Agreement upon Oral Instructions or
signatures of the present Authorized Persons as set forth in the
last delivered Certificate.
2. Annexed hereto as Appendix B is a Certificate
signed by two of the present Officers of the Fund under its
seal, setting forth the names and the signatures of the present
Officers of the Fund. The Fund agrees to furnish to the
Custodian a new Certificate in similar form in the event any
such present Officer ceases to be an Officer of the Fund, or in
the event that other or additional Officers are elected or
appointed. Until such new Certificate shall be received, the
Custodian shall be fully protected in acting under the
provisions of this Agreement upon the signatures of the Officers
as set forth in the last delivered Certificate.
3. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the
Custodian, shall be sufficiently given if addressed to the
Custodian and mailed or delivered to it at its offices at 90
Washington Street, New York, New York 10015, or at such other
place as the Custodian may from time to time designate in
writing.
4. Any notice or other instrument in writing,
authorized or required by this Agreement to be given to the
Fund, shall be sufficiently given if addressed to the Fund and
mailed or delivered to it at its office at 666 Old Country Road,
Garden City, New York 11530, or at such other place as the Fund
may from time to time designate in writing.
5. This Agreement may not be amended or modified in
any manner except by a written agreement executed by both
parties with the same formality as this Agreement and approved
by a resolution of the Directors of the Fund.
6. This Agreement shall extend to and shall be
binding upon the parties hereto, and their respective successors
and assigns; provided, however, that this Agreement shall not be
assignable by the Fund without the written consent of the
Custodian, or by the Custodian without the written consent of
the Fund, authorized or approved by a resolution of its
Directors.
7. This Agreement shall be construed in accordance
with the laws of the State of New York.
8. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original,
but such counterparts shall, together, constitute only one
instrument.
9. This Agreement shall not be effective on the date
hereof and instead shall become effective on January l, 1990.
When effective, this Agreement shall supercede the then-existing
Custody Agreement between the parties hereto.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their respective Officers, thereunto
duly authorized, and their respective corporate seals to be
hereunto affixed, as of the day and year first above written.
Dreyfus New Jersey Tax Exempt Bond Fund, Inc.
By: __________________________
John Pyburn, Treasurer
Attest:
______________________
THE BANK OF NEW YORK
By: __________________________
Attest:
______________________
Appendix A
DREYFUS NEW JERSEY TAX EXEMPT BOND FUND, INC.
AUTHORIZED SIGNATORIES:
CASH ACCOUNT AND/OR CUSTODIAN
ACCOUNT FOR PORTFOLIO SECURITIES
TRANSACTIONS
Group I Group II
All current Fund officers, Paul Casti, Jr. Alan Eisner
Frank Greene, John Bale, Jeffey Nachman Lawrence Greene
Michael Condon, Steven John Pyburn Julian Smerling
Powanda and Richard Cassaro Joseph DiMartino Thomas Durante
Robert Dubuss James Windels
Joseph Connolly Paul Molloy
Gregory Gruber
Cash Account
1. Fees payable to The Bank of New York pursuant to written
agreement with the Fund for services rendered in its
capacity as Custodian or agent of the Fund, or to The
Shareholder Services Group, Inc. in its capacity as
Transfer
Agent or agent of the Fund:
Two (2) signatures required, one of which must be
from Group II, except that an officer of the Fund
who also is listed in Group II shall sign only
once.
2. Other expenses of the Fund, $5,000 and under:
Any combination of two (2) signatures from either
Group I or Group II, or both such Groups, except
that an officer of the Fund who also is listed in
Group II shall sign only once.
3. Other expenses of the Fund, over $5,000 but not over
$25,000:
Two (2) signatures required, one of which must be
from Group II, except that an officer of the Fund
who also is listed in Group II shall sign only
once.
4. Other expenses of the Fund, over $25,000:
Two (2) signatures required, one from Group I or
Group II, including any one of the following:
Paul Casti, Jr., James Windels, Jeffrey Nachman,
John Pyburn or Alan Eisner, except that no
individual shall be authorized to sign more than
once.
Custodian Account for Portfolio Securities Transactions
Two (2) signatures required from any of the following:
All current Fund officers, and Joseph DiMartino,
Robert Dubuss, Alan Eisner, Lawrence Greene,
Julian Smerling, Alan Brown, Richard Cassaro,
Paul Disdier, Alfonso Fulgieri, Gregory Gruber,
Michael Condon, Steven Powanda, Linda Raffinello, Ann
Weintraub, Michael Charash, Theresa Viviano and
Paul Casti, Jr.
DREYFUS NEW JERSEY TAX EXEMPT BOND FUND, INC.
AMENDED AND RESTATED CUSTODY AGREEMENT
APPENDIX B
The undersigned Officers of the Fund do hereby certify
that the following individuals, whose specimen signatures are on
file with The Bank of New York, have been duly elected or
appointed by the Fund's Board to the position set forth opposite
their names and have qualified therefor:
Name Position
Richard J. Moynihan President and Investment Officer
A. Paul Disdier Vice President and Investment Officer
Karen M. Hand Vice President and Investment Officer
Stephen C. Kris Vice President and Investment Officer
L. Lawrence Troutman Vice President and Investment Officer
Samuel J. Weinstock Vice President and Investment Officer
Monica S. Wieboldt Vice President and Investment Officer
Mark N. Jacobs Vice President
John J. Pyburn Treasurer
Daniel C. Maclean Secretary
Christine Pavalos Assistant Secretary
Robert I. Frenkel Assistant Secretary
Jeffrey N. Nachman Controller
Title: Title:
AMENDED AND RESTATED CUSTODY AGREEMENT
APPENDIX C
The following, are designated publications for
purposes of paragraph 5(b) of Article III:
The Bond Buyer
Depository Trust Company Notices
Financial Daily Card Service
New York Times
Standard & Poor's Called Bond Record
Wall Street Journal
Schedule A
The fees payable to the Custodian with respect to
securities held in domestic custody are annexed hereto.
DREYFUS NEW JERSEY TAX EXEMPT BOND FUND, INC.
Domestic Custody Fees
Basic Fee: 1/50th of 1% of the first $200,000,000, 1/100th
of 1% of the next $200,000,000, and 1/200th of 1% of
the excess over $400,000,000 per annum of the
total market value of domestic securities held.
Custodial Transactions:
$15.00 for each settlement via book entry -
DTC/FRB/FRB
Paydowns.
$20.00 for all physicals, futures, options, GNMA/CMO
Paydowns.
$40.00 for any receipt, delivery or redemption of a
Euro Dollar CD for which BNY's London branch is
utilized for settlement and safekeeping.
$200.00 for the collection of interest on securities
held in "street name."
Schedule B
The fees payable to the Custodian with respect to
securities held in foreign custody are as set forth in a letter dated
August 10, 1989 from Masao Yamaguchi of The Bank of New York to Kevin
Flood of Dreyfus Service Corporation, a copy of which is annexed
hereto.
The above foreign custody fees apply to the following
Global Custody Network countries:
1. Australia 12. Japan
2. Austria 13. Luxembourg
3. Belgium 14. Malasia
4. Canada 15. Netherlands
5. Denmark 16. New Zealand
6. Finland 17. Norway
7. France 18. Singapore
8. Germany 19. Spain
9. Hong Kong 20. Sweden
10. Ireland 21. Switzerland
11. Italy 22. United Kingdom
[LETTERHEAD OF BANK OF NEW YORK]
August 10, 1989
Mr. Kevin Flood
Senior Vice President
The Dreyfus Corporation
222 Broadway, 7th Floor
New York, NY
Re: Global Custodian Fees
Dear Kevin:
This letter is to confirm our discussion regarding our
Global Custody fee schedule. The fees will be calculated on a
relationship basis with no annual minimum.
- Safekeeping/Income Collection/Capital Changes/Tax
Reclamation/Daily Reporting/Monthly Summary
16 basis points per annum on the market value of
securities held for all of your funds in our sub-
custodian network, up to $250 MM.
15 basis points on the next $250 MM.
14 basis points on the next $250 MM.
12 basis points on the excess.
- Securities Settlements
$35 per transaction - includes our processing and the
sub-custodians.
- Out-of-Pocket Expense
Telex, swift, telephone, securities registration,
etc., are in addition to the above.
- We can provide centralized foreign exchange services.
THE BANK OF NEW YORK
Mr. Kevin Flood
August 10, 1989
Page 2
The above fee schedule is applicable to the 22 countries
listed on Attachment I. Please note that expansion into other
more emerging markets/countries is possible, but would be
covered under a separate agreement.
If you are in agreement with this fee schedule, please sign
and return the enclosed copy of this letter.
Sincerely,
/s/ Masao Yamaguchi
Approved by: ____________________
Kevin Flood
Date : ____________________
MY:to
cc: The Bank of New York Dreyfus
F. Ricciardi J. Nachman
SUBCUSTODIAN AGREEMENT
The undersigned custodian (the "Custodian") for the
investment companies identified in Schedule A attached
(collectively, the "Funds") hereby appoints on the following
terms and conditions Chemical Bank as subcustodian (the
"Subcustodian") for it and the Subcustodian hereby accepts such
appointment on the following terms and conditions as of the date
set forth below.
1. Qualification. The Custodian and the Subcustodian each
represent to the other and to each Fund that it is qualified to
act as a custodian for a registered investment company under the
Investment Company Act of 1940, as amended (the "1940 Act").
2. Subcustody. The Subcustodian agrees to hold in a
separate account, segregated at all times from all other
accounts maintained by the Subcustodian, all securities and
evidence of rights thereto of each of the Funds (collectively,
"Fund Securities") deposited, from time to time by the Custodian
with the Subcustodian. The Subcustodian will accept, hold or
dispose of and take such other reasonable actions with respect
to Fund Securities, in addition to those specified in Section 3,
in accordance with the instructions of the Custodian relating to
Fund Securities given in the manner set forth in Section 4
("Instructions"). The Subcustodian hereby waives any claim
against, or lien on, any Fund Securities for any claim
hereunder. Registered Fund Securities may be held in the name
of the Subcustodian or its nominee. To the extent that
ownership of Fund Securities may be recorded by a book entry
system maintained by any transfer agent or registrar for such
Fund Securities (including, but not limited to, any such system
operated by the Subcustodian) or by Depository Trust Company,
the Subcustodian may hold Fund Securities as a book entry
reflecting the ownership of such Fund Securities by it or its
nominee and need not possess certificates or any other evidence
of ownership.
3. Subcustodian's Acts Without Instructions. Except as
otherwise instructed pursuant to Section 4, the Subcustodian
will (i) present all Fund Securities requiring presentation for
any payment thereon, (ii) distribute to the Custodian cash
received thereupon, (iii) collect and distribute to the
Custodian interest and any dividends and distributions on Fund
Securities, (iv) forward to the Custodian all confirmations,
notices, proxies or proxy soliciting materials relating to the
Fund Securities received by it (and the Custodian agrees to
forward same to the Fund), (v) report to the Custodian any
missed payment or other default upon any Fund Securities known
to it as Subcustodian hereunder, (the Subcustodian shall be
deemed to have knowledge of any payment default on any Fund
Securities in respect of which it acts as paying agent); all
cash distributions from the Subcustodian to the Custodian will
be in same day funds, on the same day funds are received by the
Subcustodian unless such distribution required instructions from
the Custodian which were not timely received, and (vi) at the
request of the Custodian, or on its behalf, execute any
necessary declarations or certificates of ownership (provided by
the Custodian or on its behalf) under any tax law now or
hereafter in effect. The Subcustodian will furnish to the
Custodian, upon the Custodian's request, any report of the
Subcustodian's independent public accountants on an examination
of its internal accounting controls and procedures for
safeguarding securities held in its custody for the account of
others.
4. Instructions, Other Communications. Any officer of the
Custodian designated from time to time, by letter to the
Subcustodian, signed by the President or any Vice President and
any Assistant Vice President, Assistant Secretary or Assistant
Treasurer of the Custodian or any other officer or employee
designated by the Custodian in writing, as an officer of the
Custodian authorized to give Instructions to the Subcustodian
with respect to Fund Securities (an "Authorized Officer") shall
be authorized to instruct the Subcustodian as to the acceptance,
holding, voting, presentation, disposition or any other action
with respect to Fund Securities from time to time in writing
signed by such Authorized Officer and delivered by hand, mail,
telecopier, tested telex, tested computer printout or such other
reasonable method as the Custodian and Subcustodian shall agree
is designed to prevent unauthorized officer's instructions. The
Subcustodian is also authorized to accept and act upon
Instructions regardless of the manner in which given (whether
orally, by telephone or otherwise) if the Subcustodian
reasonably believes such Instructions are given by an Authorized
Officer. The Subcustodian will promptly transmit to the
Custodian all receipts, confirmations or other transactional
evidence received by it in respect of Fund Securities as to
which the Subcustodian has received any Instructions.
Instructions and other communications to the Subcustodian shall
be given to Chemical Bank, 55 Water Street, Room 504, New York,
New York, Attention: Debt Securities Administration, Phone
(212) 820-5616 Telex: (212) 269-8510 (or to such other address
as the Subcustodian shall specify by notice to the Custodian and
each of the Funds). Communications to the Custodian and the
Funds shall be made at the addresses set forth below (or to such
other address as the Custodian or the Fund or Funds giving such
notice, shall specify by notice to the Subcustodian).
5. The Subcustodian. The Subcustodian shall not be liable
for any action taken or omitted to be taken in carrying out the
terms and provision of this Agreement if done without willful
malfeasance, bad faith, negligence or reckless disregard of its
obligations and duties under this Agreement.
The Subcustodian shall not have any responsibility for
ascertaining or acting upon any calls, conversions, exchange
offers, tenders, interest rate changes or similar matters
relating to the Fund Securities, except upon Instructions from
the Custodian, nor for informing the Custodian with respect
thereto, unless the Subcustodian has knowledge or is deemed to
have knowledge of the aforesaid. The Subcustodian shall be
deemed to have knowledge in circumstances where it is acting as
tender agent or paying agent for the Fund Securities. The
Subcustodian shall not be under a duty to supervise or to
provide advice (other than notice) to the Custodian or any of
the Funds relative to any purchase, sale, retention or other
disposition of any Fund Securities held hereunder. The
Subcustodian shall for the benefit of the Custodian and the
Funds be required to exercise the same care with respect to the
receiving, safekeeping, handling and delivery of Fund Securities
than it customarily exercises in respect of its own securities.
The Subcustodian will indemnify, defend and save harmless
the Custodian and the Funds from any loss or liability incurred
by the Custodian arising out of or in connection with the
Subcustodian's willful malfeasance, bad faith, negligence or
reckless disregard of its obligations and duties under this
Agreement; provided, however, that the Subcustodian shall in no
event be liable for any special, indirect or consequential
damages.
The Custodian agrees to be responsible for, and will
indemnify, defend and save harmless the Subcustodian (or any
nominee in whose name any Fund Securities are registered) for,
any loss or liability incurred by the Subcustodian (or such
nominee) arising out of or in connection with any action taken
by the Subcustodian (or such nominee) in accordance with any
Instructions or any other action taken by the Subcustodian (or
such nominee) in good faith and without negligence pursuant to
this Agreement, including any expenses, taxes or other charges
which the Subcustodian (or such nominee) is required to incur or
pay in connection therewith.
6. Resignation. The Subcustodian may resign as such at
any time upon not less than five business days' prior written
notice to the Custodian. In the event of such resignation or
any other termination of this Agreement, the Subcustodian shall
deliver all Fund Securities then held by it to the Custodian, or
as otherwise directed by the Custodian pursuant to Instructions
received by the Subcustodian, at the Custodian's expense;
provided, however, that the Subcustodian shall not be required
to effect any such delivery outside the Borough of Manhattan.
7. Miscellaneous. This Agreement (i) shall be governed by
and construed in accordance with the laws of the State of New
York, (ii) may be executed in counterparts each of which shall
be deemed an original but all of which shall constitute the same
instrument, and (iii) may be amended only by written agreement
executed by the parties hereto.
IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the
date set forth below.
Dated: , 199_
The Bank of New York
By:
As Custodian for the Funds
Listed in Schedule A Attached
Chemical Bank
By:
SUBCUSTODIAN AGREEMENT
The undersigned custodian (the "Custodian") for the
investment company identified below (the "Fund") hereby appoints
on the following terms and conditions Bankers Trust Company as
subcustodian (the "Subcustodian") for it and the Subcustodian
hereby accepts such appointment on the following terms and
conditions as of the date set forth below.
1. Qualification. The Custodian and the Subcustodian
each represents to the other and to the Fund that it is
qualified to act as a custodian for a registered investment company under
the Investment Company Act of 1940, as amended (the "1940 Act").
2. Subcustody. The Subcustodian agrees to maintain a
separate account and to hold segregated at all times from the
Subcustodian's securities and from all other customers' secur-
ities held by the Subcustodian, all the Fund's securities and
evidence of rights thereto ("Fund Securities") deposited, from
time to time by the Custodian with the Subcustodian. The Sub-
custodian will accept, hold or dispose of and take other actions
with respect to Fund Securities in accordance with the Instruc-
tions of the Custodian given in the manner set forth in Section
4 and will take certain other actions as specified in Section 3.
The Subcustodian hereby waives any claim against or lien on any
Fund Securities. The Subcustodian may take steps to register
and continue to hold Fund Securities in the name of the Subcustodi-
an's nominee and shall take such other steps as the Subcustodian
believes necessary or appropriate to carry out efficiently the
terms of this Agreement. To the extent that ownership of Fund
Securities may be recorded by a book entry system maintained by
any transfer agent or registrar for such Fund Securities or by
Depository Trust Company, the Subcustodian may hold Fund Secur-
ities as a book entry reflecting the ownership of such Fund Se-
curities by its nominee and need not possess certificates or any
other evidence of ownership of Fund Securities.
3. Subcustodian's Acts Without Instructions. Except
as otherwise instructed pursuant to Section 4, the Subcustodian
will (i) present all Fund Securities requiring presentation for
any payment thereon, (ii) distribute to the Custodian cash re-
ceived thereon, (iii) collect and distribute to the Custodian
interest and any dividends and distributions on Fund Securities,
(iv) at the request of the Custodian, or on its behalf, execute
any necessary declarations or certificates of ownership
(provided by the Custodian or on its behalf) under any tax law now or
hereafter in effect, (v) forward to the Custodian, or notify it by
telephone of, confirmations, notices, proxies or proxy
soliciting materials relating to the Fund Securities received by it as
registered holder (and the Custodian agrees to forward same to
the Fund), and (vi) promptly report to the Custodian any missed
payment or other default upon any Fund Securities known to it as
Subcustodian hereunder (the Subcustodian shall be deemed to have
knowledge of any payment default on any Fund Securities in re-
spect of which it acts as paying agent). All cash distributions
from the Subcustodian to the Custodian will be in same day
funds, on the same day that same day funds are received by the
Subcustodian unless such distribution required instructions from the
Custodian which were not timely received. Promptly after the
Subcustodian is furnished with any report of its independent
public accountants on an examination of its internal accounting
controls and procedures for safeguarding securities held in its
custody as subcustodian under this Agreement or under similar
agreements, the Subcustodian will furnish a copy thereof to the
Custodian.
4. Instructions, Other Communications. Any officer
of the Custodian designated from time to time by letter to the Sub-
custodian, signed by the President or any Vice President and any
Assistant Vice President, Assistant Secretary or Assistant
Treasurer of the Custodian, as an officer of the Custodian auth-
orized to give instructions to the Subcustodian with respect to
Fund Securities (an "Authorized Officer"), shall be authorized
to instruct the Subcustodian as to the acceptance, holding,
presentation, disposition or any other action with respect to
Fund Securities from time to time by telephone, or in writing
signed by such Authorized Officer and delivered by tested telex,
tested computer printout or such other reasonable method as the
Custodian and Subcustodian shall agree is designed to prevent
unauthorized officer's instructions; provided, however, the
Subcustodian is authorized to accept and act upon orders from
the Custodian, whether given orally, by telephone or otherwise,
which the Subcustodian reasonably believes to be given by an
authorized person. The Subcustodian will promptly transmit to the
Custodian all receipts and transaction confirmations in respect of Fund
Securities as to which the Subcustodian has received any
instructions. The Authorized Officers shall be as set forth on Exhibit
A attached hereto and, as amended from time to time, made a part
hereof.
5. Liabilities. (i) The Subcustodian shall not be
liable for any action taken or omitted to be taken in carrying
out the terms and provision of this Agreement if done without
willful malfeasance, bad faith, gross negligence or reckless
disregard of its obligations and duties under this Agreement.
Except as otherwise set forth herein, the Subcustodian shall
have no responsibility for ascertaining or acting upon any calls,
conversions, exchange offers, tenders, interest rate changes or
similar matters relating to the Fund Securities (except at the
instructions of the Custodian), nor for informing the Custodian
with respect thereto, whether or not the Subcustodian has, or is
deemed to have, knowledge of the aforesaid. The Subcustodian is
under no duty to supervise or to provide investment counseling
or advice to the Custodian or to the Fund relative to the purchase,
sale, retention or other disposition of any Fund Securities held
hereunder. The Subcustodian shall for the benefit of the
Custodian and the Fund use the same care with respect to
receiving, safekeeping, handling and delivery of Fund Securities
as it uses in respect of its own securities.
(ii) The Subcustodian will indemnify, defend and save
harmless the Custodian and the Fund from and against all loss,
liability, claims and demands incurred by the Custodian or the
Fund arising out of or in connection with the Subcustodian's
willful malfeasance, bad faith, gross negligence or reckless
disregard of its obligations and duties under this Agreement.
(iii) The Custodian agrees to be responsible for and
indemnify the Subcustodian and any nominee in whose name the
Fund Securities are registered, from and against all loss, liability,
claims and demands incurred by the Subcustodian and the nominee
in connection with the performance of any activity pursuant to
this Agreement, done in good faith and without negligence, in-
cluding any expenses, taxes or other charges which the Subcusto-
dian is required to pay in connection therewith.
6. Each party may terminate this Agreement at any
time by not less than ten (10) business days' prior written notice.
In the event that such notice is given, the Subcustodian shall
make delivery of the Fund Securities held in the Subcustodian
account to the Custodian or to any third party within the
Borough of Manhattan, specified by the Custodian in writing within ten
(10) days of receipt of the termination notice, at the Custodi-
an's expense.
7. All communications required or permitted to be
given under this Agreement, unless otherwise agreed by the parties,
shall be addressed as follows:
(i) to the Subcustodian:
Bankers Trust Company
1 Bankers Trust Plaza
14th Floor
New York, NY 10015
Attention: Barbara Walter
RMO Safekeeping Unit
(ii) to the Custodian:
The Bank of New York
110 Washington Street
New York, New York 10286
8. Miscellaneous: This Agreement (i) shall be
governed by and construed in accordance with the laws of the
State of New York, (ii) may be executed in counterparts each of
which shall be deemed an original but all of which shall
constitute the same instrument, and (iii) may be amended by the
parties hereto in writing.
IN WITNESS WHEREOF, the undersigned have executed this
Agreement as of the date set forth below.
Dated: , 199_
THE BANK OF NEW YORK
Custodian
By:__________________________
Title:_______________________
As Custodian For
[NAME OF FUND]
BANKERS TRUST COMPANY
As Subcustodian
By:___________________________
Title:________________________
EXHIBIT A TO SUBCUSTODIAN AGREEMENT
DATED , 199_
The Authorized Officers pursuant to Section 4 of the
Agreement shall be:
__________________________ _____________________________
__________________________ _____________________________
__________________________ _____________________________
__________________________ _____________________________
__________________________ _____________________________
__________________________ _____________________________
Dated: , 199_
THE BANK OF NEW YORK
As Custodian
By:__________________________
Title:_______________________
[LETTERHEAD OF STROOCK & STROOCK & LAVAN]
EXHIBIT 10
July 5, 1988
Dreyfus New Jersey Tax Exempt
Bond Fund, Inc.
666 Old Country Road
Garden City, New York 11530
Gentlemen:
We have acted as counsel to Dreyfus New Jersey Tax
Exempt Bond Fund, Inc. (the "Fund") in connection with the
preparation of a Registration Statement on Form N-lA,
Registration No. 33-19655 (the "Registration Statement"),
covering shares of Common Stock, par value $.00l per share, of
the Fund.
We have examined copies of the Articles of
Incorporation and By-Laws of the Fund, the Registration
Statement, and such other corporate records and documents as we
have deemed necessary for the purpose of this opinion. We also
have examined such other documents, papers, statutes and
authorities as we deemed necessary to form a basis for the
opinion hereinafter expressed. In our examination of such
material, we have assumed the genuineness of all signatures and
the conformity to original documents of all copies submitted to
us. As to various questions of fact material to such opinion,
we have relied upon statements and certificates of officers and
representatives of the Fund and others.
Attorneys involved in the preparation of this opinion
are admitted only to the bar of the State of New York. As to
various questions arising under the laws of the State of
Maryland, we have relied on the opinion of Messrs. Venable,
Baetjer and Howard, a copy of which is attached hereto.
Qualifications set forth in their opinion are deemed
incorporated herein.
Based upon the foregoing, we are of the opinion that
the shares of Common Stock, par value $.001 per share, of the
Fund to be issued in accordance with the terms of the offering
as set forth in the Prospectus included as part of the
Registration Statement, when so issued and paid for, will
constitute validly authorized and issued shares of Common Stock,
fully paid and nonassessable.
We hereby consent to the filing of this opinion as an
exhibit to the Registration Statement and to the reference to us
in the Prospectus included in the Registration Statement, and to
the filing of this opinion as an exhibit to any application made
by or on behalf of the Fund or any Distributor or dealer in
connection with the registration and qualification of the Fund
or its Common Stock under the securities laws of any state or
jurisdiction. In giving such permission, we do not admit hereby
that we come within the category of persons whose consent is
required under Section 7 of the Securities Act of 1933 or the
rules and regulations of the Securities and Exchange Commission
thereunder.
Very truly yours,
/s/ Stroock & Stroock & Lavan
STROOCK & STROOCK & LAVAN
[LETTERHEAD OF VENABLE, BAETJER AND HOWARD]
July 5, 1988
Stroock & Stroock & Lavan
Seven Hanover Square
New York, New York 10004
Re: Dreyfus New Jersey Tax Exempt Bond Fund, Inc.
Gentlemen:
We have acted as Maryland counsel for Dreyfus New
Jersey Tax Exempt Bond Fund, Inc., a Maryland corporation (the
"Fund"), in connection with the organization of the Fund and the
issuance of shares of its Common Stock, $.001 par value per
share ("Common Stock").
As Maryland counsel for the Fund, we have examined its
Charter, its By-Laws, the Prospectus and Statement of Additional
Information included in its Registration Statement on Form N-lA,
substantially in the form in which it is to become effective
(the "Registration Statement"), and have examined and relied
upon such corporate records of the Fund and other documents and
certificates as to factual matters as we have deemed to be
necessary to render the opinion expressed herein. We have
assumed without independent verification the genuineness of the
signatures on and the conformity with originals of all documents
submitted to us as copies.
Based on such examination, we are of the opinion that:
l. The Fund is duly organized and validly existing
as a corporation in good standing under the laws of the State of
Maryland.
2. The 8,696 shares of presently issued and
outstanding stock of the Fund have been validly and legally
issued and are fully paid and non-assessable shares under the
laws of the State of Maryland.
3. The balance of the shares of Common Stock of the
Fund to be sold pursuant to the Registration Statement are
authorized and unissued shares and, when sold, issued and paid
for as contemplated in the Registration Statement, will have
been validly and legally issued and will be fully paid and
non-assessable shares of Common Stock of the Fund under the laws
of the State of Maryland.
This letter expresses our opinion as to the Maryland
General Corporation Law governing matters such as due
organization and the authorization and issuance of stock, but
does not extend to the securities or "Blue Sky" laws of Maryland
or to federal securities or other laws.
You may rely upon our foregoing opinion in rendering
your opinion to the Fund which is to be filed as an exhibit to
the Registration Statement. We consent to the filing of this
opinion as an exhibit to the Registration Statement.
Very truly yours,
/s/ Venable, Baetjer and Howard
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the captions "Condensed
Financial Information" and "Transfer and Dividend Disbursing Agent,
Custodian, Counsel and Independent Auditors" and to the use of our report
dated February 9, 1996 in this Registration Statement (Form N-1A 33-19655)
of Dreyfus New Jersey Municipal Bond Fund, Inc.
ERNST & YOUNG LLP
New York, New York
April 15, 1996
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