File Nos. 33-41078
811-6325
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. 6 [X]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]
Amendment No. 6 [X]
(Check appropriate box or boxes.)
PEOPLES S&P MIDCAP INDEX 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
Daniel C. Maclean III, 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)
----
on (date) pursuant to paragraph (b)
----
60 days after filing pursuant to paragraph (a)(i)
----
X on March 1, 1996 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 October 31, 1995 was filed on December 28, 1995.
PEOPLES S&P MIDCAP INDEX 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 3
4 General Description of Registrant 4, 13
5 Management of the Fund 7
5(a) Management's Discussion of Fund's Performance *
6 Capital Stock and Other Securities 13
7 Purchase of Securities Being Offered 7
8 Redemption or Repurchase 9
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-18
13 Investment Objectives and Policies B-2
14 Management of the Fund B-6
15 Control Persons and Principal B-9
Holders of Securities
16 Investment Advisory and Other B-9
Services
_____________________________________
NOTE: * Omitted since answer is negative or inapplicable.
PEOPLES S&P MIDCAP INDEX 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-17
18 Capital Stock and Other Securities B-18
19 Purchase, Redemption and Pricing B-12, B-13
of Securities Being Offered
20 Tax Status B-16
21 Underwriters B-12
22 Calculations of Performance Data B-17
23 Financial Statements B-21
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-3
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.
PROSPECTUS March 1, 1996
Dreyfus MidCap Index Fund
Dreyfus MidCap Index Fund (the "Fund") is an open-end,
non-diversified, management investment company, known as an index fund. The
Fund's investment objective is to provide investment results that correspond
to the price and yield performance of publicly-traded common stocks of
medium-size domestic companies in the aggregate, as represented by the
Standard & Poor's MidCap 400 Index. In anticipation of taking a market
position, the Fund is permitted to purchase and sell stock index futures. The
Fund is neither sponsored by nor affiliated with Standard & Poor's, a
division of The McGraw-Hill Companies, Inc.
The Dreyfus Corporation ("Dreyfus") serves as the Fund's Manager.
Dreyfus has engaged its affiliate, Mellon Equity Associates ("Mellon
Equity"), to serve as the Fund's index fund manager and provide day-to-day
management of the Fund's investments. Dreyfus and Mellon Equity are referred
to collectively as the "Advisers."
Shareholders who redeem shares within six months of the opening of
their account will be charged a 1% redemption fee which will be deducted from
redemption proceeds. However, the redemption fee will not be applicable to
shares held in omnibus accounts.
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 March 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 WILL FLUCTUATE FROM
TIME TO TIME.
TABLE OF CONTENTS
Page
Fee Table......................................... 3
Condensed Financial Information................... 3
Description of the Fund........................... 4
Management of the Fund............................ 6
How to Buy Fund Shares............................ 7
How to Redeem Fund Shares......................... 9
Shareholder Services.............................. 11
Shareholder Services Plan......................... 11
Dividends, Distributions and Taxes................ 12
Performance Information........................... 13
General Information............................... 13
Appendix.......................................... 15
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.
Page 1
[This Page Intentionally Left Blank]
# Page 2
<TABLE>
<CAPTION>
Fee Table
<S> <C> <C> <C> <C> <C>
Shareholder Transaction Expenses:
Redemption Fees (as a percentage of amount redeemed)......................................... 1.00%
Annual Fund Operating Expenses:
(as a percentage of average daily net assets)
Management Fee .............................................................................. .40%
Other Expenses............................................................................... .45%
Total Fund Operating Expenses................................................................ .85%
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: $5 $16 $28 $63
</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%.
The purpose of the foregoing table is to assist you in
understanding the costs and expenses borne by the Fund and investors, the
payment of which will reduce investors' annual return. The information in the
foregoing table does not reflect any fee waivers or expense reimbursement
arrangements that may be in effect. You can purchase Fund shares without
charge directly from the Fund's distributor; you may be charged a nominal fee
if you effect transactions in Fund shares through a securities dealer, bank or
other financial institution. See "Management of the Fund," "How to Buy Fund
Shares," "How to Redeem Fund Shares" and "Shareholder Services Plan."
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 October 31,
------------------------------------------
PER SHARE DATA: 1991(1) 1992 1993 1994 1995
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C>
Net asset value, beginning of year..................... $12.50 $13.69 $15.02 $17.63 $17.14
------ ------ ------ ------ ------
Investment Operations:
Investment income_net.................................. .11 .17 .30 .26 .29
Net realized and unrealized gain on investments........ 1.08 1.29 2.83 .08 3.00
------ ------ ------ ------ ------
Total from Investment Operations..................... 1.19 1.46 3.13 .34 3.29
------ ------ ------ ------ ------
Distributions:
Dividends from investment income_net................... -- (.08) (.27) (.27) (.28)
Dividends from net realized gain on investments........ -- (.05) (.25) (.56) (.75)
------ ------ ------ ------ ------
TOTAL DISTRIBUTIONS.................................. -- (.13) (.52) (.83) (1.03)
------ ------ ------ ------ ------
Net asset value, end of year........................... $13.69 $15.02 $17.63 $17.14 $19.40
====== ====== ====== ====== ======
TOTAL INVESTMENT RETURN.................................... 9.52%(2) 10.69% 21.22% 1.89% 20.78%
RATIOS/SUPPLEMENTAL DATA:
Ratio of expenses to average net assets................ -- -- .09% .40% .50%
Ratio of net investment income to average net assets... .87%(2) 2.22% 1.97% 1.68% 1.80%
Decrease reflected in above expense ratios due to undertakings 1.19%(2) 1.17% .77% .43% .35%
Portfolio Turnover Rate................................ 2.18%(2) 16.31% 16.80% 19.81% 20.46%
Net Assets, end of year (000's omitted)................ $5,436 $45,989 $65,690 $75,404 $122,982
(1) From June 19, 1991 (commencement of operations) to October 31, 1991.
(2) Not annualized.
</TABLE>
# Page 3
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 investment results
that correspond to the price and yield performance of publicly-traded common
stocks of medium-size domestic companies in the aggregate, as represented by
the Standard & Poor's MidCap 400 Index* (the "Index"). It 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.
MANAGEMENT POLICIES
The Fund attempts to duplicate the investment results of the Index,
which is composed of 400 selected common stocks of medium-size domestic
companies, which may include some Canadian issuers, with market
capitalizations ranging generally between $__ million and $__ billion. The
median market capitalization of the stocks in the Index is approximately $__
billion. Standard & Poor's, a division of The McGraw-Hill Companies, Inc.
("S&P"), chooses the stocks to be included in the Index on the basis of
market size, liquidity and industry group representation. The Fund attempts
to be fully invested at all times in the stocks that comprise the Index and
stock index futures as described below and, in any event, at least 80% of the
Fund's net assets will be so invested. Inclusion of a stock in the Index in
no way implies an opinion by S&P as to its attractiveness as an investment.
An investment in the Fund involves risks similar to those of investing in
common stocks.
The weightings of stocks in the Index are based on each stock's
relative total market capitalization; that is, its market price per share
times the number of shares outstanding. Because of this weighting, as of
November 30, 1995, 46.3% of the Index was composed of the 50 largest
companies. The Index is comprised of the following broad sectors in
approximate proportions: Industrials _ ___%; Utilities _ ___%; Financial _
___%; and Transportation and Services _ __%. Of the companies, approximately
__% are listed on the New York Stock Exchange, __% are quoted on the National
Association of Securities Dealers Automated Quotation System and _% are
listed on the American Stock Exchange. Mellon Equity will select stocks for
the Fund's portfolio in the order of their weightings in the Index beginning
with the heaviest weighted stocks. With respect to the Fund's assets invested
in the stocks in the Index, the percentage of such assets invested in each
stock will be approximately the same as the percentage it represents in the
Index. Since some of the stocks that comprise the Index may be thinly traded,
comparatively small investments could cause relatively volatile price
fluctuations.
No attempt is made to manage the Fund's portfolio in the
traditional sense using economic, financial and market analysis. The Fund is
managed using a computer program to determine which securities are to be
purchased or sold to replicate the Index to the extent feasible. From time to
time, administrative adjustments may be made in the Fund's portfolio because
of changes in the composition of the Index.
The Fund believes that the indexing approach described above is an
effective method of substantially duplicating percentage changes in the
Index. It is a reasonable expectation that there will be a close correlation
between the Fund's performance and that of the Index in both rising and
falling markets. The Fund will attempt to achieve a correlation between the
performance of its portfolio and that of the Index of at least 0.95, without
taking into account expenses. A correlation of 1.00 would indicate perfect
corre-
*"S&PRegistration Mark" and "Standard & Poor's MidCap 400 Index" are
trademarks of Standard & Poor's, a division of The McGraw-Hill Companies,
Inc., and have been licensed for use by the Fund. The Fund is not sponsored,
endorsed, sold or promoted by Standard & Poor's.
# Page 4
lation, which would be achieved when the Fund's net asset value,
including the value of its dividends and capital gains distributions,
increases or decreases in exact proportion to changes in the Index. The
Fund's ability to correlate its performance with the Index, however, may be
affected by, among other things, changes in securities markets, the manner in
which the Index is calculated by S&P and the timing of purchases and
redemptions. In the future, the Fund's Board, subject to the approval of
shareholders, may select another index if such a standard of comparison is
deemed to be more representative of the performance of the common stocks of
medium-size companies.
The Fund's ability to duplicate the performance of the Index also
depends to some extent on the size of the Fund's portfolio and the size of
cash flows into and out of the Fund. Investment changes to accommodate these
cash flows are made to maintain the similarity of the Fund's portfolio to the
Index to the maximum practicable extent.
From time to time to increase its income, the Fund may lend
securities from its portfolio. See "Appendix_Investment Techniques." When the
Fund has cash reserves, the Fund may invest in money market instruments
consisting of U.S. Government securities, time deposits, certificates of
deposit, bankers' acceptances, high-grade commercial paper, and repurchase
agreements. See the Statement of Additional Information for a description of
these instruments. The Fund also may purchase stock index futures in anticipat
ion of taking a market position when, in the opinion of the Mellon Equity
Advisers, available cash balances do not permit an economically efficient
trade in the cash market. The Fund also may sell stock index futures to
terminate existing positions it may have as a result of its purchases of
stock index futures. See also "Investment Considerations and Risks" and
"Appendix_Investment Techniques" below, and "Investment Objective and
Management Policies" in the Statement of Additional Information.
INVESTMENT CONSIDERATIONS AND RISKS --
General _ The Fund's net asset value per share should be expected to
fluctuate. Investors should consider the Fund as a supplement to an overall
investment program and should invest only if they are willing to undertake
the risks involved. See "Investment Objective and Management
Policies_Management Policies" in the Statement of Additional Information for
a further discussion of certain risks.
Equity Securities _ Equity securities fluctuate in value, often based on
factors unrelated to the value of the issuer of the securities, and such
fluctuations can be pronounced. Changes in the value of the Fund's
investments will result in changes in the value of its shares and thus the
Fund's total return to investors.
The securities of the smaller companies in which the Fund may
invest may be subject to more abrupt or erratic market movements than larger,
more established companies, because these securities typically are traded in
lower volume and the issuers typically are subject to a greater degree to
changes in earnings and prospects.
Use of Derivatives _ The Fund may invest, to a limited extent, 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 stock index
futures. 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 investments 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 Fund's classification 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 securities of a
limited
# Page 5
number of issuers, some of which may be within the same industry, the Fund's
portfolio may be more sensitive to changes in the market value of a single
issuer or industry. 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. The Fund may not
invest more than 25% of its assets in any one industry. These limitations do
not apply to U.S. Government securities.
Simultaneous Investments _ Investment decisions for the Fund are made
independently from those of the other accounts and investment companies
advised by Dreyfus or Mellon Equity. However, if such other accounts or
investment companies are prepared to invest in, or desire to dispose of,
securities in which the Fund invests, available investments or opportunities
for sales will be allocated equitably to each. In some cases, this procedure
may adversely affect the size of the position obtained for or disposed of by
the Fund or the price paid or received by the Fund.
Management of the Fund
ADVISERS -- Dreyfus, located at 200 Park Avenue, New York, New York 10166,
was formed in 1947 and serves as the Fund's manager. Dreyfus is a
wholly-owned subsidiary of Mellon Bank, N.A., which is a wholly-owned
subsidiary of Mellon Bank Corporation ("Mellon"). As of December 31, 1995,
Dreyfus managed or administered approximately $__ billion in assets for more
than 1.8 million investor accounts nationwide.
Dreyfus 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.
Dreyfus has engaged Mellon Equity, located at 500 Grant Street,
Pittsburgh, Pennsylvania 15258, to serve as the Fund's index Fund manager.
Mellon Equity, a registered investment adviser formed in 1957, is an indirect
wholly-owned subsidiary of Mellon and thus, an affiliate of Dreyfus. As of
December 31, 1995, Mellon Equity and its employees managed approximately $__
billion in assets and served as the investment adviser of __ other investment
companies.
Mellon Equity, subject to the supervision and approval of Dreyfus,
provides the day-to-day management of the Fund's investments, as well as
statistical information, under an Index Management Agreement with Dreyfus,
subject to the overall authority of the Fund's Board in accordance with
Maryland law.
Mellon is a publicly owned multibank holding company incorporated
under Pennsylvania law in 1971 and registered under the Federal Bank Holding
Company Act of 1956, as amended. Mellon provides a comprehensive range of
financial products and services in domestic and selected international
markets. Mellon is among the twenty-five largest bank holding companies in
the United States based on total assets. Mellon's principal wholly-owned
subsidiaries are Mellon Bank, N.A., Mellon Bank (DE) National Association,
Mellon Bank (MD), The Boston Company, Inc., AFCO Credit Corporation and a
number of companies known as Mellon Financial Services Corporations. Through
its subsidiaries, including Dreyfus and Mellon Equity, Mellon managed more
than $___ billion in assets as of December 31, 1995, including approximately
$__ billion in proprietary mutual fund assets. As of December 31, 1995,
Mellon, through various subsidiaries, provided non-investment services, such
as custodial or administration services, for more than $__ billion in assets,
including approximately $___ billion in mutual fund assets.
Pursuant to the terms of the Management Agreement, the Fund has
agreed to pay Dreyfus a monthly fee at the annual rate of .395 of 1% of the
value of the Fund's average daily net assets. Under the Fund's Index
Management Agreement, Dreyfus has agreed to pay Mellon Equity a monthly fee
at the annual rate of .095 of 1% of the Fund's average daily net assets,
which fee includes payment for the provision of custody services to the Fund
by Boston Safe Deposit and Trust Company.
Prior to November 13, 1995, World Asset Management served as the
Fund's index fund manager pursuant to an Index Management Agreement with the
Fund and Dreyfus served as the Fund's administrator
# Page 6
pursuant to an Administration Agreement with the Fund. Pursuant to
such agreements, the Fund agreed to pay World Asset Management and Dreyfus
.10% and .30%, respectively, of the value of the Fund's average daily net
assets. For the fiscal year ended October 31, 1995, no index management fee
or administration fee was paid by the Fund pursuant to undertakings then in
effect.
The imposition of the Fund's management fees, as well as other
operating expenses, will have the effect of reducing investors' return and
will affect the Fund's ability to track the Index exactly. From time to time,
Dreyfus and/or Mellon Equity or one of their affiliates may waive receipt of
their 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 at the time such amounts are waived or assumed,
as the case may be. The Fund will not pay Dreyfus and/or Mellon Equity or
their affiliates at a later time for any amounts which may be waived, nor
will the Fund reimburse Dreyfus and/or Mellon Equity or their affiliates for
any amounts which may be assumed.
Dreyfus 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 securities dealers or others in respect of these services.
CUSTODIAN AND TRANSFER AGENT AND DIVIDEND DISBURSING AGENT -- Boston Safe
Deposit and Trust Company, One Boston Place, Boston, Massachusetts 02108
("Boston Safe"), is the custodian of the Fund's investments. Boston Safe is
an indirect subsidiary of Mellon. Dreyfus Transfer, Inc., a wholly-owned
subsidiary of Dreyfus, P.O. Box 9671, Providence, Rhode Island 02903, is the
Fund's Transfer and Dividend Disbursing Agent (the "Transfer Agent").
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.
How to Buy Fund Shares
Fund shares are sold without a sales charge. You may be charged a
nominal fee if you effect transactions in Fund shares through a securities
dealer, bank or other financial institution. Stock certificates are issued
only upon your written request. No certificates are issued for fractional
shares. 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 securities dealer, bank or other financial institution 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 Fund's Account Application. For full-time or part-time
employees of Dreyfus or any of its affiliates or subsidiaries, directors of
Dreyfus, Board members of a fund advised by Dreyfus, 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 Dreyfus
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 initial
and subsequent investment minimum requirements at any time. The Fund's shares
are available for purchase by pension and profit-sharing plans.
You may purchase Fund shares by check or wire. Checks should be
made payable to "Dreyfus MidCap Index Fund.," or, if for Dreyfus retirement
plan accounts, to "The Dreyfus Trust Company, Custodian." For subsequent
investments, your Fund account number also should appear on the check.
Payments which are mailed should be sent to Dreyfus MidCap Index Fund, P.O.
Box 6647, Providence, Rhode Island 02940-6647, together with your investment
slip or, when opening a new account, your Account Application. For Dreyfus
retirement plan accounts, both initial and subsequent investments should be
sent to The Dreyfus Trust Company, Custodian, P.O. Box 6427, Providence,
Rhode Island 02940-6427. Neither initial nor subsequent investments should be
made by third party check. Purchase orders may be delivered in person only to
a Dreyfus Financial Center. THESE ORDERS WILL BE FORWARDED TO THE FUND
# Page 7
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 #8900052732/Dreyfus MidCap
Index Fund, 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 Fund's
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. 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."
The Distributor may pay dealers a fee of up to .5% of the amount
invested through such dealers in Fund shares by employees participating in
qualified or non-qualified employee benefit plans or other programs where (i)
the employers or affiliated employers maintaining such plans or programs have
a minimum of 250 employees eligible for participation in such plans or
programs, or (ii) such plan's or program's aggregate investment in the
Dreyfus Family of Funds or certain other products made available by the
Distributor to such plans or programs exceeds $1,000,000. Shares of funds in
the Dreyfus Family of Funds then held by such employee benefit plans or
programs will be aggregated to determine the fee payable. The Distributor
reserves the right to cease paying these fees at any time. The Distributor
will pay such fees from its own funds, other than amounts received from the
Fund, including past profits or any other source available to it.
Fund shares are sold on a continuous basis at the net asset value
per share next determined after your order is received in proper form by the
Transfer Agent or other agent. If an order is received in proper form 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) on a given day, Fund shares
will be purchased at the net asset value determined as of such close of
trading on that day. Otherwise, Fund shares will be purchased at the net
asset value determined as of the close of trading on the floor of the New
York Stock Exchange on the next business day. To permit the Fund to invest
your money as promptly as possible after receipt, thereby maximizing the
Fund's ability to track the Index, you are urged to transmit your purchase
order so that it may be received by the Transfer Agent prior to 12:00 noon,
New York time, on the day you want your purchase order to be effective.
The Fund's net asset value per share is determined as of the close
of trading on the floor of the New York Stock Exchange on each day the New
York Stock Exchange is open for business. For purposes of determining net
asset value per share, futures contracts will be valued 15 minutes after the
close of trading on the floor of the New York Stock Exchange. Net asset value
per share 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 of shares
outstanding. The Fund's investments are valued based on market value, or
where market quotations are not readily available, based on fair value as
determined in good faith by the Fund's Board. For further
# Page 8
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 Fund's 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").
How to Redeem Fund 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, which may be more or less than their
original cost. To maximize the Fund's ability to track the Index, you are
urged to transmit your redemption request so that it may be received by the
Transfer Agent prior to 12:00 noon, New York time, on the day you want your
redemption request to be effective.
You will be charged a 1% redemption fee upon the redemption of Fund
shares where the redemption occurs within the initial six-month period
following the opening of your account. This redemption fee will be deducted
from your redemption proceeds and retained by the Fund. It is expected that,
as a result of this fee, the Fund will be able to track the Index more
closely. No redemption fee will be charged upon the redemption of shares
purchased through omnibus accounts, nor will the redemption fee be used to
pay fees imposed for various Fund services. The redemption fee may be waived,
modified or discontinued and reintroduced at any time or from time to time.
In addition, securities dealers, banks and other financial institutions 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 Fund ordinarily will make payment for all shares redeemed
within seven days after receipt by the Transfer Agent of a redemption request
in accordance with the procedures described below, except as provided by the
rules of the Securities and Exchange Commission. HOWEVER, IF YOU HAVE
PURCHASED FUND SHARES BY CHECK OR THROUGH DREYFUS-AUTOMATIC ASSET 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 OR DREYFUS-AUTOMATIC ASSET BUILDER ORDER, WHICH MAY
TAKE UP TO EIGHT BUSINESS DAYS OR MORE. IN ADDITION, THE FUND WILL REJECT
REQUESTS TO REDEEM SHARES BY WIRE OR TELEPHONE FOR A PERIOD OF EIGHT BUSINESS
DAYS AFTER RECEIPT BY THE TRANSFER AGENT OF THE PURCHASE CHECK OR THE DREYFUS-
AUTOMATIC ASSET BUILDER ORDER AGAINST WHICH SUCH REDEMPTION IS REQUESTED.
THESE PROCEDURES WILL NOT APPLY IF YOUR SHARES WERE PURCHASED BY WIRE
PAYMENT, OR IF YOU OTHERWISE HAVE A SUFFICIENT COLLECTED BALANCE IN YOUR
ACCOUNT TO COVER THE REDEMPTION REQUEST. PRIOR TO THE TIME ANY REDEMPTION IS
EFFECTIVE, DIVIDENDS ON SUCH SHARES WILL ACCRUE AND BE PAYABLE, AND YOU WILL
BE ENTITLED TO EXERCISE ALL OTHER RIGHTS OF BENEFICIAL OWNERSHIP. Fund shares
will not be redeemed until the Transfer Agent has received your Account
Application.
The Fund reserves the right to redeem your account at its option
upon not less than 45 days' written notice if your account's net asset value
is $500 or less and remains so during the notice period.
PROCEDURES
You may redeem 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 Wire
Redemption Privilege or the Telephone Redemption Privilege. The Fund makes
available to cer
# Page 9
tain large institutions the ability 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.
You may redeem Fund shares by telephone if you have checked the
appropriate box on the Fund's Account Application or have filed a Shareholder
Services Form with the Transfer Agent. If you select a telephone redemption
privilege, you authorize the Transfer Agent to act on telephone instructions
from any person representing himself or herself to be you, 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 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 Dreyfus MidCap Index Fund, P.O. Box 6647,
Providence, Rhode Island 02940-6647, or, if for Dreyfus retirement plan
accounts, to The Dreyfus Trust Company, Custodian, P.O. Box 6427, Providence,
Rhode Island 02940-6427. Redemption requests may be delivered in person only
to a Dreyfus Financial Center. 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.
Your written redemption request may direct that the redemption
proceeds be used to purchase shares of other funds advised or administered by
Dreyfus. The 1% redemption fee, described above, if applicable, may be
charged upon such redemption (depending upon how long your Fund account has
been open or the type of account from which shares are being redeemed) and
your redemption proceeds will be invested in shares of the other fund on the
next business day. Before you make such a request, you must obtain and should
review a copy of the current prospectus of the fund being purchased.
Prospectuses may be obtained by calling 1-800-645-6561. The prospectus will
contain information concerning minimum investment requirements and other
conditions that may apply to your purchase. No other fees currently are
charged shareholders directly in connection with this procedure, 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. This procedure may be modified or
terminated at any time upon not less than 60 days' notice to shareholders.
# Page 10
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. Shares held under Keogh Plans, IRAs or other
retirement plans, and shares for which certificates have been issued, are not
eligible for this Privilege.
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. This
Privilege may be modified or terminated at any time by the Transfer Agent or
the Fund. Shares held under Keogh Plans, IRAs or other retirement plans, and
shares for which certificates have been issued, are not eligible for this
Privilege.
Shareholder Services
DREYFUS-AUTOMATIC ASSET BUILDERRegistration Mark -- Dreyfus-Automatic Asset
Builder permits you to purchase Fund shares (minimum of $100 and maximum of
$150,000 per transaction) at regular intervals selected by you. Fund shares
are purchased by transferring funds from the bank account designated by you.
At your option, the bank account designated by you will be debited in the
specified amount, and Fund shares will be purchased, once a month, on either
the first or fifteenth day, or twice a month, on both days. Only an account
maintained at a domestic financial institution which is an Automated Clearing
House member may be so designated. This privilege 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. 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 Dreyfus MidCap Index Fund, P.O. Box 6647, Providence, Rhode Island
02940-6647, or, if for Dreyfus retirement plan accounts, to The Dreyfus Trust
Company, Custodian, P.O. Box 6427, Providence, Rhode Island 02940-6427, and
the notification will be effective three business days following receipt. The
Fund may modify or terminate this Privilege at any time or charge a service
fee. No such fee currently is contemplated.
RETIREMENT PLANS -- The Fund offers a variety of pension and profit-sharing
plans, including Keogh Plans, IRAs, SEP-IRAs and IRA "Rollover Accounts,"
401(k) Salary Reduction Plans and 403(b)(7) Plans. Plan support services also
are available. You can obtain details on the various plans by calling the
following numbers toll free: for Keogh Plans, please call 1-800-358-5566; for
IRAs and IRA "Rollover Accounts," please call 1-800-645-6561; for SEP-IRAs,
401(k) Salary Reduction Plans and 403(b)(7) Plans, please call 1-800-322-7880.
Shareholder Services Plan
The Fund has adopted a Shareholder Services Plan pursuant to which
the Fund reimburses Dreyfus Service Corporation, a wholly-owned subsidiary of
Dreyfus, an amount not to exceed an annual rate of .25 of 1% of the value of
the Fund's average daily net assets for certain allocated expenses of
providing personal services and/or maintaining shareholder accounts. The
services provided may include personal services relating to shareholder
accounts, such as answering shareholder inquiries regarding the Fund and
providing reports and other information, and services related to the
maintenance of shareholder accounts.
# Page 11
Dividends, Distributions and Taxes
The Fund ordinarily declares and pays dividends from net investment
income and distributes net realized securities gains, if any, once a year,
but the Fund may make distributions on a more frequent basis to comply with
the distribution requirements of the Internal Revenue Code of 1986, as
amended (the "Code"), in all events in a manner consistent with the
provisions of the 1940 Act. The Fund will automatically reinvest dividends
and distributions from securities gains, if any, in additional Fund shares at
net asset value or, at your option, pay them in cash. The Fund will not make
distributions from net realized securities gains unless capital loss
carryovers, if any, have been utilized or have expired. If applicable, the 1%
redemption fee, described under "How to Redeem Fund Shares," will be charged
upon certain redemptions of Fund shares received through the automatic
reinvestment of dividends or distributions. All expenses are accrued daily
and deducted before declaration of dividends to investors.
Dividends paid by the Fund derived from net investment income and
distributions from net realized short-term securities gains of the Fund will
be taxable to shareholders as ordinary income whether received in cash or
reinvested in additional Fund shares. Depending on the composition of the
Fund's income, all or a portion of the dividends paid by the Fund from net
investment income may qualify for the dividends received deduction allowable
to certain corporate shareholders. Distributions from net realized long-term
securities gains of the Fund will be taxable to U.S. shareholders as
long-term capital gains for Federal income tax purposes, regardless of how
long shareholders have held their Fund shares and whether such distributions
are received in cash or reinvested in additional Fund shares. The Code
provides that the net capital gain of an individual generally will not be
subject to Federal income tax at a rate in excess of 28%. Dividends and
distributions may be subject to state and local taxes.
Dividends derived from net investment income and distributions from
net realized short-term securities gains paid by the Fund to a foreign
investor generally are subject to U.S. nonresident withholding taxes at the
rate of 30%, unless the foreign investor claims the benefit of a lower rate
specified in a tax treaty. Distributions from net realized long-term
securities gains paid by the Fund to a foreign investor as well as the
proceeds of any redemptions from a foreign investor's account, regardless of t
he extent to which gain or loss may be realized, generally will not be
subject to U.S. nonresident withholding tax. However, such distributions may
be subject to backup withholding, as described below, unless the foreign
investor certifies his non-U.S. residency status.
Notice as to the tax status of your dividends and distributions
will be mailed to you annually. You also will receive periodic summaries of
your account which will include information as to dividends and distributions
from securities gains, if any, paid during the year.
Federal regulations generally require the Fund to withhold ("backup
withholding") and remit to the U.S. Treasury 31% of dividends, distributions
from net realized securities gains of the Fund 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.
Management of the Fund believes that the Fund has qualified for the
fiscal year ended October 31, 1995, as a "regulated investment company" under
the Code. The Fund intends to continue to so quali-
# Page 12
fy if such qualification is in the best interest of its
shareholders. Such qualification relieves the Fund of any liability for
Federal income tax to the extent its earnings are distributed in accordance
with applicable provisions of the Code. 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 the purpose of advertising, performance is calculated on the
basis of average annual total return and/or total return.
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. 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.
Comparative performance information may be used from time to time
in advertising or marketing the Fund's shares, including data from Standard &
Poor's MidCap 400 Index, Standard & Poor's 500 Composite Stock Price Index,
Lipper Analytical Services, Inc., the Dow Jones Industrial Average, MONEY Maga
zine, Morningstar, Inc. and other industry publications. The Fund may cite in
its advertisements or in reports or other communications to shareholders,
historical performance of unmanaged indices as reported in Ibbotson, Roger G.
and Rex A. Sinquefield, STOCKS, BONDS, BILLS AND INFLATION (SBBI), 1982,
updated annually in the SBBI YEARBOOK, Ibbotson Associates, Chicago. In its
advertisements, the Fund also may cite the aggregate amount of assets
committed to index investing by pension funds and/or other institutional
investors, which currently exceeds $___ billion, and may refer to or discuss
then-current or past economic or financial conditions, developments or
events.
General Information
The Fund was incorporated under Maryland law on June 6, 1991, and
commenced operations on June 19, l991. On November 13, 1995, the Fund, which
is incorporated under the name People's S&P MidCap Index Fund, Inc., began
operating under the name Dreyfus MidCap Index Fund. The Fund is authorized to
issue 200 million shares of Common Stock, par value $.001 per share. Each
share has one vote.
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
Directors 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
purposes of removing a Director from office and for any other purpose. Fund sh
areholders may remove a Director 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 Directors if, at any
time, less than a majority of the Directors then holding office have been
elected by shareholders.
# Page 13
#
The Transfer Agent maintains a record of your ownership and sends
you confirmations and statements of account.
Shareholder inquiries may be made 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.
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.
The Fund is not sponsored, endorsed, sold or promoted by S&P. S&P
makes no representation or warranty, express or implied, to the owners of the
Fund or any member of the public regarding the advisability of investing in
securities generally or in the Fund particularly or the ability of the S&P
MidCap 400 Index to track general stock market performance. S&P's only
relationship to the Fund is the licensing of certain trademarks and trade
names of S&P and of the S&P MidCap 400 Index which is determined, composed
and calculated by S&P without regard to the Fund. S&P has no obligation to
take the needs of the Fund or the owners of the Fund into consideration in
determining, composing or calculating the S&P MidCap 400 Index. S&P is not
responsible for and has not participated in the calculation of the Fund's net
asset value, nor is S&P a distributor of the Fund. S&P has no obligation or
liability in connection with the administration, marketing or trading of the
Fund.
S&P DOES NOT GUARANTEE THE ACCURACY AND/OR THE COMPLETENESS OF THE
S&P MIDCAP 400 INDEX OR ANY DATA INCLUDED THEREIN. S&P MAKES NO WARRANTY,
EXPRESS OR IMPLIED, AS TO RESULTS TO BE OBTAINED BY THE FUND, OWNERS OF THE
FUND, OR ANY OTHER PERSON OR ENTITY FROM THE USE OF THE S&P MIDCAP 400 INDEX
OR ANY DATA INCLUDED THEREIN. S&P MAKES NO EXPRESS OR IMPLIED WARRANTIES, AND
EXPRESSLY DISCLAIMS ALL WARRANTIES OF MERCHANTABILITY OR FITNESS FOR A
PARTICULAR PURPOSE OR USE WITH RESPECT TO THE S&P MIDCAP 400 INDEX OR ANY
DATA INCLUDED THEREIN. WITHOUT LIMITING ANY OF THE FOREGOING, IN NO EVENT
SHALL S&P HAVE ANY LIABILITY FOR ANY SPECIAL, PUNITIVE, INDIRECT, OR
CONSEQUENTIAL DAMAGES (INCLUDING LOST PROFITS), EVEN IF NOTIFIED OF THE
POSSIBILITY OF SUCH DAMAGES.
# Page 14
Appendix
Investment Techniques
Borrowing Money _ The Fund is permitted 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.
Use of Derivatives _ Although the Fund will not be a commodity pool,
Derivatives subject the Fund to the rules of the Commodity Futures Trading
Commission which limit the extent to which the Fund can invest in certain
Derivatives. The Fund may invest in stock index futures contracts for hedging
purposes without limit. However, the Fund may not invest in such contracts
for other purposes if the sum of the amount of initial margin deposits, other
than for bona fide hedging purposes, exceed 5% of the liquidation value of
the Fund's assets, after taking into account unrealized profits and
unrealized losses on such contracts.
Lending Portfolio Securities _ The Fund may lend securities from its
portfolio to brokers, dealers and other financial institutions needing to
borrow securities to complete certain transactions. In connection with such
loans, the Fund continues to be entitled to payments in amounts equal to the
interest, dividends or other distributions payable on the loaned securities.
Loans of portfolio securities afford the Fund an opportunity to earn interest
on the amount of the loan and at the same time to earn income on the loaned
securities' collateral. Loans of portfolio securities may not exceed 30% of
the value of the Fund's total assets. In connection with such loans, 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.
# Page 15
Dreyfus
MidCap Index
Fund
Prospectus
Registration Mark
Copy Rights 1996 Dreyfus Service Corporation
113p603196
Page 16
DREYFUS MIDCAP INDEX FUND
PART B
(STATEMENT OF ADDITIONAL INFORMATION)
MARCH 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 MidCap Index Fund (the "Fund"), dated March 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 ("Dreyfus") serves as the Fund's manager.
Dreyfus has engaged its affiliate, Mellon Equity Associates ("Mellon
Equity"), to serve as the Fund's index fund manager and provide day-to-day
management of the Fund's investments. Dreyfus and Mellon Equity are
referred to collectively as the "Advisers."
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-6
Management Arrangements . . . . . . . . . . . . . . . . . . . B-9
Shareholder Services Plan . . . . . . . . . . . . . . . . . . B-12
Purchase of Fund Shares . . . . . . . . . . . . . . . . . . . B-12
Redemption of Fund Shares . . . . . . . . . . . . . . . . . . B-13
Shareholder Services. . . . . . . . . . . . . . . . . . . . . B-14
Determination of Net Asset Value. . . . . . . . . . . . . . . B-15
Dividends, Distributions and Taxes. . . . . . . . . . . . . . B-16
Portfolio Transactions. . . . . . . . . . . . . . . . . . . . B-17
Performance Information . . . . . . . . . . . . . . . . . . . B-17
Information About the Fund. . . . . . . . . . . . . . . . . . B-18
Transfer and Dividend Disbursing Agent, Custodian,
Counsel and Independent Auditors . . . . . . . . . . . . B-19
Appendix. . . . . . . . . . . . . . . . . . . . . . . . . . . B-20
Financial Statements. . . . . . . . . . . . . . . . . . . . . B-21
Report of Independent Auditors. . . . . . . . . . . . . . . . B-33
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."
Money Market Instruments. The Fund may invest, in the circumstances
described under "Description of the Fund - Management Policies" in the
Fund's Prospectus, in the following types of money market instruments.
U.S. Government Securities. Securities issued or guaranteed by the
U.S. Government or its agencies or instrumentalities include U.S. Treasury
securities that differ in their interest rates, maturities and times of
issuance. Some obligations issued or guaranteed by U.S. Government
agencies and instrumentalities are supported by the full faith and credit
of the U.S. Treasury; others, by the right of the issuer to borrow from the
Treasury; others, by discretionary authority of the U.S. Government to
purchase certain obligations from 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. While the
U.S. Government provides financial support for such U.S. Government-
sponsored agencies and instrumentalities, no assurance can be given that it
will always do so since it is not so obligated by law.
Repurchase Agreements. In a repurchase agreement, 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 or sub-custodian will have custody of, and
will hold in a segregated account, securities acquired by the Fund under a
repurchase agreement. Repurchase agreements are considered by the staff of
the Securities and Exchange Commission to be loans by 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 one billion dollars 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.
Bank Obligations. The Fund may purchase certificates of deposit, time
deposits, bankers' acceptances and other short-term obligations issued by
domestic banks, foreign subsidiaries or foreign branches of domestic banks,
domestic and foreign branches of foreign banks, domestic savings and loan
associations and other banking institutions. With respect to such
securities issued by foreign subsidiaries or foreign branches of domestic
banks, and domestic and foreign branches of foreign banks, the Fund may be
subject to additional investment risks that are different in some respects
from those incurred by a fund which invests only in debt obligations of
U.S. domestic issuers.
Certificates of deposit are negotiable certificates evidencing 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.
Bankers' acceptances are credit instruments evidencing the obligation
of a bank to pay a draft drawn on it by a customer. These instruments
reflect the obligation both of the bank and the drawer to pay the face
amount of the instruments upon maturity. The other short-term obligations
may include uninsured, direct obligations bearing fixed, floating or
variable interest rates.
Commercial Paper. Commercial paper consists of short-term, unsecured
promissory notes issued to finance short-term credit needs. The commercial
paper purchased by the Fund will consist only of direct obligations which,
at the time of their purchase, are (a) rated at least Prime-1 by Moody's
Investors Service, Inc. ("Moody's") or A-1 by Standard & Poor's Ratings
Group, a division of The McGraw Hill Companies, Inc. ("S&P"), (b) issued by
companies having an outstanding unsecured debt issue currently rated not
lower than Aa3 by Moody's or AA- by S&P, or (c) if unrated, determined by
the Advisers to be of comparable quality to those rated obligations which
may be purchased by the Fund.
Management Policies
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 for securities loaned.
The Securities and Exchange Commission currently requires that the
following conditions must be met whenever portfolio securities are loaned:
(1) the Fund must receive at least 100% cash collateral from the borrower;
(2) the borrower must increase such collateral whenever the market value of
the securities rises above the level of such collateral; (3) the Fund must
be able to terminate the loan at any time; (4) the Fund must receive
reasonable interest on the loan, as well as any dividends, interest or
other distributions payable on the loaned securities, and any increase in
market value; (5) the Fund may pay only reasonable custodian fees in
connection with the loan; and (6) while voting rights on the loaned
securities may pass to the borrower, the Fund's Board must terminate the
loan and regain the right to vote the securities if a material event
adversely affecting the investment occurs. These conditions may be subject
to future modification.
Derivatives. The Fund may invest in Derivatives (as defined in the
Fund's Prospectus) in anticipation of taking a market position when, in the
opinion of the Advisers, available cash balances do not permit an
economically efficient trade in the cash market. Derivatives may provide a
cheaper, quicker or more specifically focused way for the Fund to invest
than "traditional" securities would.
Derivatives can be volatile and involve various types and degrees of
risk, depending upon the characteristics of the particular Derivative and
the portfolio as a whole. Derivatives permit the Fund to increase,
decrease or change the level of risk to which its portfolio is exposed in
much the same way as the Fund can increase, decrease or change the risk of
its portfolio by making investments in specific securities.
In addition, 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 its
Derivatives were poorly correlated with its other investments, or if the
Fund were unable to liquidate its position because of an illiquid secondary
market. The market for many Derivatives is, or suddenly can become,
illiquid. Changes in liquidity may result in significant, rapid and
unpredictable changes in the prices for Derivatives.
Stock Index Futures - A stock index future obligates the seller to
deliver (and the purchaser to take) and amount of cash equal to a specific
dollar amount times the difference between the value of a specific stock
index at the close of the last trading day of the contract and the price at
which the agreement is made. No physical delivery of the underlying stocks
in the index is made. The Fund purchases and sells futures contracts on
the stock index for which it can obtain the best price with consideration
also given to liquidity.
Using futures in anticipation of market transactions involves certain
risks. Although the Fund intends to purchase or sell futures contracts
only if there is an active market for such contracts, no assurance can be
given that a liquid market will exist for any particular contract at any
particular time. In addition, the price of stock index futures may not
correlate perfectly with the movement in the stock index due to certain
market distortions. First, all participants in the futures market are
subject to margin deposit and maintenance requirements. Rather than
meeting additional margin deposit requirements, investors may close futures
contracts through offsetting transactions which would distort the normal
relationship between the index and futures markets. Secondly, from the
point of view of speculators, the deposit requirements in the futures
market are less onerous than margin requirements in the securities market.
Therefore, increased participation by speculators in the futures market
also may cause temporary price distortions. Because of the possibility of
price distortions in the futures market and the imperfect correlation
between movements in the stock index and movements in the price of stock
index futures, a correct forecast of general market trends still may not
result in a successful hedging transaction.
In connection with its futures transactions, the Fund may be required
to establish and maintain at its custodian bank a segregated account
consisting of cash or high quality money market instruments in an amount
equal to the market value of the underlying commodity less any amount
deposited as margin.
Investment Restrictions
The Fund has adopted the following investment restrictions 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. The
Fund may not:
1. Purchase securities of any company having less than three years'
continuous operations (including operations of any predecessors) if such
purchase would cause the value of the Fund's investments in all such
companies to exceed 5% of the value of its total assets.
2. Purchase securities of closed-end investment companies except (a)
in the open market where no commission other than the ordinary broker's
commission is paid, which purchases are limited to a maximum of (i) 3% of
the total outstanding voting stock of any one closed-end investment
company, (ii) 5% of the Fund's net assets with respect to the securities
issued by any one closed-end investment company and (iii) 10% of the Fund's
net assets in the aggregate, or (b) those received as part of a merger or
consolidation. The Fund may not purchase the securities of open-end
investment companies other than itself.
3. Invest in commodities, except that the Fund may invest in futures
contracts as described in the Fund's Prospectus and this Statement of
Additional Information.
4. Purchase, hold or deal in real estate, real estate investment
trust securities, real estate limited partnership interests, or oil, gas or
other mineral leases or exploration or development programs, but the Fund
may purchase and sell securities that are secured by real estate or issued
by companies that invest or deal in real estate.
5. Borrow money, except from banks for temporary or emergency (not
leveraging) purposes in an amount up to 15% of the value of the Fund's
total assets (including the amount borrowed) based on the lesser of cost or
market, less liabilities (not including the amount borrowed) at the time
the borrowing is made. While borrowings exceed 5% of the value of the
Fund's total assets, the Fund will not make any additional investments.
Transactions in futures and options do not involve any borrowing for
purposes of this restriction.
6. Pledge, hypothecate, mortgage or otherwise encumber its assets,
except to secure borrowings for temporary or emergency purposes.
Collateral arrangements with respect to initial or variation margin for
futures contracts will not be deemed to be pledges of the Fund's assets.
7. Lend any funds or other assets except through the purchase of debt
securities, bankers' acceptances and commercial paper of corporations and
other entities. However, the Fund may lend its portfolio securities in an
amount not to exceed 30% 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 of Directors.
8. Act as an underwriter of securities of other issuers. The Fund
may not enter into repurchase agreements providing for settlement in more
than seven days after notice or purchase illiquid securities, if, in the
aggregate, more than 10% of the value of the Fund's net assets would be so
invested.
9. Invest in the securities of a company for the purpose of
exercising management or control, but the Fund will vote the securities it
owns in its portfolio as a shareholder in accordance with its views.
10. Purchase, sell or write puts, calls or combinations thereof.
11. Invest more than 25% of its assets in investments in any
particular industry or industries (including banking), except to the extent
the Standard & Poor's MidCap 400 Index also is so concentrated, provided
that, when the Fund has adopted a temporary defensive posture, there shall
be no limitation on the purchase of obligations issued or guaranteed by the
U.S. Government, its agencies or instrumentalities.
In addition to the investment restrictions adopted as fundamental
policies set forth above, though not fundamental policies, the Fund may not
(i) engage in arbitrage transactions, (ii) purchase warrants (excluding
those acquired by the Fund in units or attached to securities), or
(iii) sell securities short, but the Fund reserves the right to sell
securities short against the box (a transaction in which the Fund enters
into a short sale of a security which the Fund owns).
If a percentage restriction is adhered to at the time of investment, a
later change in percentage resulting from a change in values or assets will
not constitute a violation of such restriction.
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
interest of the Fund and its shareholders, the Fund reserves the right to
revoke the commitment by terminating the sale of Fund shares in the state
involved.
MANAGEMENT OF THE FUND
Directors 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 Director who is deemed to be an "interested person"
of the Fund, as defined in the 1940 Act, is indicated by an asterisk.
Directors 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 Dreyfus and Executive
Vice President and a director of Dreyfus Service Corporation, a
wholly-owned subsidiary of Dreyfus and, until August 1994, the Fund's
distributor. From August 24, 1994 to December 31, 1994, he was a
director of Mellon Bank Corporation. He is Chairman of the Board of
Directors of Noel Group, Inc., a venture capital company; a trustee of
Bucknell University; and a director of the Muscular Dystrophy
Association, HealthPlan Services Corporation, Belding Heminway, Inc.,
a manufacturer and marketer of industrial threads, specialty yarns and
home furnishings and fabrics, Curtis Industries, Inc., a national
distributor of security products, chemicals, and automotive and other
hardware, Simmons Outdoor Corporation and Staffing Resources, Inc. He
is 52 years old and his address is 200 Park Avenue, New York, New York
10166.
*DAVID P. FELDMAN, Director. Corporate Vice President-Investment
Management of AT&T. He is also a trustee of Corporate Property
Investors, a real estate investment company. He is 56 years old and
his address is One Oak Way, Berkeley Heights, New Jersey 07922.
JACK R. MEYER, Director. President and Chief Executive Officer of Harvard
Management Company, an investment management company, since September
1990. For more than five years prior thereto, he was Treasurer and
Chief Investment Officer of The Rockefeller Foundation. He is 50
years old and his address is 600 Atlantic Avenue, Boston,
Massachusetts 02210.
JOHN SZARKOWSKI, Director. Director Emeritus of Photography at The Museum
of Modern Art. Consultant in Photography. He is 70 years old and his
address is Bristol Road Box 221, East Chatham, New York 12060.
ANNE WEXLER, Director. Chairman of the Wexler Group, consultants
specializing in government relations and public affairs. She is also
a director of Alumax, Comcast Corporation and 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, 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. She is 65
years old and her address is c/o The Wexler Group, 1317 F Street,
N.W., Suite 600, Washington, D.C. 20004.
For so long as the Fund's plan described in the section captioned
"Shareholder Services Plan" remains in effect, the Directors of the Fund
who are not "interested persons" of the Fund, as defined in the 1940 Act,
will be selected and nominated by the Directors who are not "interested
persons" of the Fund.
<TABLE>
<CAPTION>
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 Director by the Fund for the fiscal year ended
October 31, 1995, 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:
(5)
(3) Total Compensation
(2) Pension or (4) From Fund and
(1) Aggregate Retirement Benefits Estimated Annual From Fund Complex
Name of Board Compensation from Accrued as Part of Benefits Upon Paid to Board
Member Fund* Fund's Expenses Retirement Member
- ------------ ----------------- ------------------- ---------------- ----------------
<S> <C> <C> <C> <C>
Joseph S. DiMartino $4,153 none none $445,000 (93)
David P. Feldman $4,000 none none $ 85,631 (27)
Jack R. Meyer $4,500 none none $ 21,875 (4)
John Szarkowski $4,500 none none $ 21,875 (4)
Anne Wexler $4,500 none none $ 26,329 (16)
____________________________
* Amount does not include reimbursed expenses for attending Board meetings, which
amounted to $___ for all Directors as a group.
</TABLE>
Officers of the Fund
MARIE E. CONNOLLY, President and Treasurer. President and Chief Executive
Officer and a Director of the Distributor and an officer of other
investment companies advised or administered by Dreyfus. 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,
General Counsel, Secretary and Clerk of the Distributor and an officer
of other investment companies advised or administered by Dreyfus.
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 by Dreyfus. 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 Dreyfus. She is 26 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
Dreyfus. 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 Dreyfus. From 1984 to July 1994, he was Assistant
Vice President in the Mutual Fund Accounting Department of Dreyfus.
He is 60 years old.
MARGARET PARDO, Assistant Secretary. Legal Assistant with the Distributor
and an officer of other investment companies advised or administered
by Dreyfus. 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.
Directors and officers of the Fund, as a group, owned less than 1% of
the Fund's shares of Common Stock outstanding on December 22, 1995.
The following persons are known by the Fund to own of record 5% or
more of the Fund's voting securities outstanding on December 22, 1995:
MANAGEMENT ARRANGEMENTS
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Management
of the Fund."
Management Agreement. Dreyfus provides management services pursuant
to the Management Agreement (the "Management Agreement") dated November 13,
1995 with the Fund, which is subject (after May 14, 1997) 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 Dreyfus, by vote cast in person at a meeting called for the
purpose of voting on such approval. The Management Agreement was approved
by shareholders on November 3, 1995, and by the Fund's Board, including a
majority of the Board members who are not "interested persons" of any party
to the Management Agreement, at a meeting held on August 9, 1995. The
Management Agreement is terminable without penalty, on 60 days' notice, by
the Fund's Board or by vote of the holders of a majority of the Fund's
shares, or, upon not less than 90 days' notice, by Dreyfus. The Management
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 Dreyfus:
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; 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; Henry D.
Gottmann, Vice President-Retail Sales and Service; Mark N. Jacobs, Vice
President-Legal and Secretary; Daniel C. Maclean, Vice President and
General Counsel; Jeffrey N. Nachman, Vice President-Mutual Fund Accounting;
Andrew S. Wasser, Vice President-Information Services; Katherine C.
Wickham, Vice President-Human Resources; Maurice Bendrihem, Controller;
Elvira Oslapas, Assistant Secretary; and Mandell L. Berman, Frank V.
Cahouet, Alvin E. Friedman, Lawrence M. Greene, Julian M. Smerling and
David B. Truman, directors.
Dreyfus maintains office facilities on behalf of the Fund, and
furnishes the Fund statistical and research data, clerical help,
accounting, data processing, bookkeeping and internal auditing and certain
other required services to the Fund. Dreyfus also may make such
advertising and promotional expenditures, using its own resources, as it
from time to time deems appropriate.
Index Management Agreement. Mellon Equity provides investment
advisory assistance and day-to-day management of the Fund's investments
pursuant to the Index Management Agreement (the "Index Management
Agreement") dated November 13, 1995 between Mellon Equity and Dreyfus. The
Index Management Agreement is subject (after May 14, 1997) to annual
approval by (i) the Fund's Board or (ii) vote of a majority (as defined in
the 1940 Act) of the Fund's outstanding voting securities, provided that in
either event the continuance also is approved by a majority of the Fund's
Board members who are not "interested persons" (as defined in the 1940 Act)
of the Fund or Mellon Equity, by vote cast in person at a meeting called
for the purpose of voting on such approval. The Index Management Agreement
was approved by shareholders on November 3, 1995, and was approved by the
Fund's Board, including a majority of Board members who are not "interested
persons" of any party to the Index Management Agreement, at a meeting held
on August 9, 1995. The Index Management Agreement is terminable without
penalty (i) by Dreyfus on 60 days' notice, (ii) by the Fund's Board or by
vote of the holders of a majority of the Fund's shares on 60 days' notice,
or (iii) by Mellon Equity on not less than 90 days' notice. The Index
Management Agreement will terminate automatically in the event of its
assignment (as defined in the 1940 Act) or upon the termination of the
Management Agreement for any reason.
The following persons are executive officers and/or directors of
Mellon Equity: Phillip R. Roberts, Chairman of the Board; William P.
Rydell, President and Chief Executive Officer; and W. Keith Smith,
Director.
Mellon Equity provides day-to-day management of the Fund's investments
in accordance with the stated policies of the Fund, subject to the
supervision of Dreyfus and approval of the Fund's Board. All purchases and
sales are reported for the Board's review at the meeting subsequent to such
transactions. Mellon Equity has agreed to pay for the custody services
provided to the Fund by Boston Safe Deposit and Trust Company.
Expenses. All expenses incurred in the operation of the Fund are
borne by the Fund, except to the extent specifically assumed by Dreyfus
and/or Mellon Equity. The expenses borne by the Fund include:
organizational costs, 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
Dreyfus or Mellon Equity or any of their affiliates, Securities and
Exchange Commission fees, state Blue Sky qualification fees, advisory fees,
transfer and dividend disbursing agents' fees, certain insurance premiums,
industry association fees, outside auditing and legal expenses, costs of
independent pricing services, costs of maintaining the Fund's existence,
costs attributable to investor services (including, without limitation,
telephone and personnel expenses), costs of preparing and printing
prospectuses and statements of additional information for regulatory
purposes and for distribution to existing shareholders, costs of
shareholder's reports and meetings, and any extraordinary expenses.
As compensation for Dreyfus' services, the Fund has agreed to pay
Dreyfus a monthly fee at the annual rate of .395 of 1% of the value of the
Fund's average daily net assets. As compensation for Mellon Equity's
services, Dreyfus has agreed to pay Mellon Equity a monthly fee at the
annual rate of .095 of 1% of the value of the Fund's average daily net
assets. All fees and expenses are accrued daily and deducted before
declaration of dividends to shareholders.
From January 3, 1995 to November 13, 1995, World Asset Management
("World") served as the Fund's index fund manager; from February 24, 1994
to January 3, 1995, World Asset Management, Inc. ("WAM") served as the
Fund's index fund manager; from June 18, 1992 to February 24, 1994,
Woodbridge Capital Management, Inc. ("Woodbridge") served as the Fund's
index fund manager; and prior to June 18, 1992, Manufacturers Bank, N.A.
(together with World, WAM and Woodbridge, the "prior index fund managers")
served as the Fund's index fund manager. Pursuant to prior index
management agreements with the prior index fund managers, the Fund agreed
to pay a monthly fee at the annual rate of .10 of 1% of the value of the
Fund's average daily net assets. For the fiscal years ended October 31,
1993, 1994 and 1995, the index management fees payable to the prior index
fund managers amounted to $54,913, $72,970 and $98,063, respectively.
However, no index management fees were paid to the prior index fund
managers for the fiscal years ending October 31, 1993 and 1994 pursuant to
undertakings in effect, and for the fiscal year ended October 31, 1995 the
fee was reduced by $39,687.
Prior to November 13, 1995, Dreyfus served as the Fund's administrator
pursuant to an administration agreement with the Fund. As compensation for
its administrative services, the Fund agreed to pay Dreyfus a monthly fee
at the annual rate of .30 of 1% of the value of the Fund's average daily
net assets. For the fiscal years ended October 31, 1993, 1994 and 1995,
the administrative fees payable to Dreyfus amounted to $164,739, $218,911
and $294,190, respectively. However, no administrative fees were paid to
Dreyfus pursuant to undertakings in effect.
Dreyfus (and to a limited extent, Mellon Equity) have agreed that if
in any fiscal year the aggregate expenses of the Fund (including fees
pursuant to the Management Agreement, but excluding taxes, brokerage,
interest on borrowings and, with the prior written consent of the necessary
state securities commissions, extraordinary expenses) exceed the expense
limitation of any state having jurisdiction over the Fund, the Fund may
deduct from the fees to be paid to Dreyfus, and Dreyfus may deduct from the
fees paid to Mellon Equity, or Dreyfus and Mellon Equity each will bear,
such excess expense in proportion to their management fee and Index
Management fee, to the extent required by state law. Such deduction or
payment, if any, will be estimated daily and reconciled and effected or
paid, as the case may be, on a monthly basis.
The aggregate of the fees payable to Dreyfus and Mellon Equity is not
subject to reduction as the value of the Fund's net assets increases.
SHAREHOLDER SERVICES PLAN
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "Shareholder
Services Plan."
The Fund has adopted a Shareholder Services Plan (the "Plan") pursuant
to which the Fund reimburses Dreyfus Service Corporation for certain
allocated expenses of providing personal services and/or maintaining
shareholder accounts. The services provided may include personal services
relating to shareholder accounts, such an answering shareholder inquiries
regarding the Fund and providing reports and other information, and
services related to the maintenance of shareholder accounts.
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 material
amendments of the Plan must be approved by the Board, and by Board members
who are not "interested persons" (as defined in the 1940 Act) of the Fund
and have no direct or indirect financial interest in the operation of the
Plan, by vote cast in person at a meeting called for the purpose of
considering such amendments. The Plan is subject to annual approval by
such vote cast in person at a meeting called for the purpose of voting on
the Plan, and was last approved by the Board at a meeting held on May 3,
1995. The Plan is terminable at any time by vote of a majority of Board
members who are not "interested persons" (as defined in the 1940 Act) of
the Fund and have no direct or indirect financial interest in the operation
of the Plan.
For the fiscal year ended October 31, 1995, $134,490 was charged to
the Fund under the Plan.
PURCHASE OF FUND SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Fund Shares."
The Distributor. The Distributor serves as the Fund's distributor on
a best efforts basis pursuant to an agreement which is renewable annually.
The Distributor also acts as distributor for the other funds in the Dreyfus
Family of Funds and for certain other investment companies.
Transactions through Securities Dealers. In some states, banks or
other financial institutions effecting transactions in Fund shares may be
required to register as dealers pursuant to state law.
REDEMPTION OF FUND SHARES
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to
Redeem Fund Shares."
Wire Redemption Privilege. By using this Privilege, the investor
authorizes Dreyfus Transfer, Inc. (the "Transfer Agent") to act on wire or
telephone redemption instructions from any person representing himself or
herself to be the investor, 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
if the Transfer Agent receives the 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 are 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 wire
redemption proceeds, a written request must be sent to the Transfer agent.
This request must be signed by each shareholder, with each signature
guaranteed as described below under "Stock Certificates; Signatures."
Stock Certificates; Signatures. Any certificates representing Fund
shares to be redeemed must be submitted with the redemption request.
Written redemption requests must be signed by each shareholder, including
each holder of a joint account, and each signature must be guaranteed.
Signatures on endorsed certificates submitted for redemption also must be
guaranteed. The Transfer Agent has adopted standards and procedures
pursuant to which signature-guarantees in proper form generally will be
accepted from domestic banks, brokers, dealers, credit unions, national
securities exchanges, registered securities associations, clearing agencies
and savings associations, as well as from participants in the New York
Stock Exchange Medallion Signature Program, the Securities Transfer Agents
Medallion Program ("STAMP") and the Stock Exchanges Medallion Program.
Guarantees must be signed by an authorized signatory of the guarantor and
"Signature-Guaranteed" must appear with the signature. The Transfer Agent
may request additional documentation from corporations, executors,
administrators, trustees or guardians, and may accept other suitable
verification arrangements from foreign investors, such as consular
verification. For more information with respect to signature-guarantees,
please call one of the telephone numbers listed on the cover.
Redemption Commitment. The Fund has committed to pay in cash all
redemption requests by any shareholder of record, limited in amount during
any 90-day period to the lesser of $250,000 or 1% of the value of 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 Board of Directors reserves the right to make payments in whole
or part in securities or other assets of the Fund in case of an emergency
or any time a cash distribution would impair the liquidity of the Fund to
the detriment of the existing shareholders. In such event, the securities
would be valued in the same manner as the Fund's portfolio is valued. If
the recipient 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."
Corporate Pension, Profit-Sharing and Personal Retirement Plans. The
Fund makes available to corporations a variety of prototype pension and
profit-sharing plans including a 401(k) Salary Reduction Plan. In
addition, the Fund makes available Keogh Plans, IRAs, including IRAs set up
under a Simplified Employee Pension Plan ("SEP-IRAs") and IRA "Rollover
Accounts," and 403(b)(7) Plans. Plan support services also are available.
Investors can obtain details on the various plans by calling the following
numbers toll free: for Keogh Plans, please call 1-800-358-5566; for IRAs
and IRA "Rollover Accounts," please call 1-800-645-6561; for SEP-IRAs,
401(k) Salary Reduction Plans and 403(b)(7) Plans, please call 1-800-322-
7880.
Investors who wish to purchase Fund shares in conjunction with a Keogh
Plan, a 403(b)(7) Plan or an IRA, including a SEP-IRA, may request from the
Distributor forms for adoption of such plans.
A fee may be charged by the entity acting as custodian for Keogh
Plans, 403(b)(7) Plans or IRAs, payment of which could require the
liquidation of shares. All fees charged are described in the appropriate
form.
Shares may be purchased in connection with these plans only by direct
remittance to the entity which acts as custodian. Purchases for these
plans may not be made in advance of receipt of funds.
The minimum initial investment for corporate plans, Salary Reduction
Plans, 403(b)(7) Plans, and SEP-IRAs, with more than one participant, is
$2,500, with no minimum on subsequent purchases. The minimum initial
investment for Dreyfus-sponsored Keogh Plans, IRAs, SEP-IRAs and 403(b)(7)
Plans, with only one participant, is normally $750, with no minimum on
subsequent purchases. Individuals who open an IRA also may open a non-
working spousal IRA with a minimum investment of $250.
The investor should read the prototype retirement plan and the
appropriate form of custodial agreement for further details as to
eligibility, service fees and tax implications, and should consult a tax
adviser.
DETERMINATION OF NET ASSET VALUE
The following information supplements and should be read in
conjunction with the section in the Fund's Prospectus entitled "How to Buy
Fund Shares."
Valuation of Portfolio Securities. The Fund's portfolio securities
are valued at the last sale price on the securities exchange or national
securities market on which such securities are primarily traded.
Securities not listed on an exchange or national securities market, or
securities in which there were no transactions, are valued at the average
of the most recent bid and asked prices. Bid price is used when no asked
price is available. Any securities or other assets for which recent market
quotations are not readily available are valued at fair value as determined
in good faith by the Fund's Board. Expenses and fees, including the index
management and administration fees (reduced by the expense limitation, if
any), are accrued daily and 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.
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."
Taxation of the Fund. Management of the Fund believes that the Fund
qualified for the fiscal year ended October 31, 1995 as a "regulated
investment company" under the Internal Revenue Code of 1986, as amended
(the "Code"). The Fund intends to continue to so qualify as long as such
qualification is in the best interests of its shareholders. The term
"regulated investment company" does not imply the supervision of management
or investment practices or policies by any government agency.
Ordinarily, gains and losses realized from portfolio transactions will
be treated as capital gain or loss. In addition, all or a portion of the
gain realized from engaging in "conversion transactions" may be treated as
ordinary income under Section 1258. "Conversion transactions" are defined
to include certain forward, futures, option and "straddle" transactions,
transactions marketed or sold to produce capital gains, or transactions
described in Treasury regulations to be issued in the future.
Under Section 1256 of the Code, gain or loss realized by the Fund from
certain financial futures transactions will be treated as 60% long-term
capital gain or loss and 40% short-term capital gain or loss. Gain or loss
will arise upon the exercise of such futures as well as from closing
transactions. In addition, any such futures remaining unexercised at the
end of the Fund's taxable year will be treated as sold for their then fair
market value, resulting in additional gain or loss to the Fund
characterized in the manner described above.
Offsetting positions held by the Fund involving futures may constitute
"straddles." Straddles are defined to include "offsetting positions" in
actively traded personal property. The tax treatment of straddles is
governed by Sections 1092 and 1258 of the Code, which, in certain
circumstances, overrides or modifies the provisions of Section 1256 of the
Code.
As such, all or a portion of any short or long-term capital gain from
certain "straddle" and conversion transactions may be recharacterized to
ordinary income. If the Fund were treated as entering into straddles by
reason of its futures transactions, such straddles could be characterized
as "mixed straddles" if the futures transactions comprising such straddles
were governed by Section 1256 of the Code. The Fund may make one or more
elections with respect to "mixed straddles." Depending upon which election
is made, if any, the results to the Fund may differ. If no election is
made, to the extent the straddle and conversion transaction rules apply to
positions established by the Fund, losses realized by the Fund will be
deferred to the extent of unrealized gain in any offsetting positions.
Moreover, as a result of the straddle rules, short-term capital loss on
straddle positions may be recharacterized as long-term capital loss, and
long-term capital gain may be recharacterized as short-term capital gain or
ordinary income.
Shareholder Taxation. Depending on the composition of the Fund's
income, all or a portion of the dividends paid by the Fund from net
investment income may qualify for the dividends received deduction
allowable to certain U.S. corporate shareholders ("dividends received
deduction"). In general, dividend income of the Fund distributed to
qualifying corporate shareholders will be eligible for the dividends
received deduction only to the extent that (i) the Fund's income consists
of dividends paid by U.S. corporations and (ii) the Fund would have been
entitled to the dividends received deduction with respect to such dividend
income if the Fund were not a regulated investment company. The dividends
received deduction for qualifying corporate shareholders may be further
reduced if the shares of the Fund held by them with respect to which
dividends are received are treated as debt-financed or deemed to have been
held for less than 46 days. In addition, the Code provides other
limitations with respect to the ability of a qualifying corporate
shareholder to claim the dividends received deduction in connection with
holding Fund shares.
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 dividend or distribution would be a return
on the investment in an economic sense although taxable as stated above.
In addition, the Code provides that if a shareholder holds shares of the
Fund for six months or less and has received a capital gain distribution
with respect to such shares, any loss incurred on the sale of such shares
will be treated as a long-term capital loss to the extent of the capital
gain distribution received.
PORTFOLIO TRANSACTIONS
The Advisers assume general supervision over placing orders on behalf
of the Fund for the purchase or sale of portfolio securities. Allocation
of brokerage transactions, including their frequency, is made in the best
judgment of the Advisers and in a manner deemed fair and reasonable to
shareholders. The primary consideration is prompt execution of orders at
the most favorable net price. Brokers also are selected because of their
ability to handle special executions such as are involved in large block
trades or broad distributions, provided the primary consideration is met.
Portfolio turnover may vary from year to year, as well as within a year.
High turnover rates are likely to result in comparatively greater brokerage
expenses. The overall reasonableness of brokerage commissions paid is
evaluated by the Advisers based upon their knowledge of available
information as to the general level of commissions paid by other
institutional investors for comparable services.
For its portfolio securities transactions for the fiscal years ended
October 31, 1993, 1994 and 1995, the Fund paid total brokerage commissions
of $24,477, $24,979 and $58,043, respectively, none of which was paid to
the Distributor. There were no spreads or concessions on principal
transactions in fiscal 1993, 1994 and 1995.
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 average annual total return for the 1 and 4.370 year
periods ended October 31, 1995 was 20.78% and 14.52%, 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 June 19, 1991 (commencement of
operations) to October 31, 1995 was %. Total return is calculated by
subtracting the amount of the Fund's net asset value per share at the
beginning of a stated period from the net asset value per share at the end
of the period (after giving effect to the reinvestment of dividends and
distributions during the period), and dividing the result by the net asset
value per share at the beginning of the period.
Comparative performance information may be used from time to time in
advertising the Fund's shares, including data from Standard & Poor's 500
Composite Stock Price Index (the "S&P Index"), Lipper Analytical Services,
Inc., the Dow Jones Industrial Average and other industry publications.
The Fund's share price and yield fluctuate, and its investment return will
reflect applicable expenses. The Fund also may cite in its advertisements
or reports or other communications to shareholders, historical performance
of unmanaged indexes as reported in Ibbotson, Roger G. and Rex A.
Sinquefield, Stocks, Bonds, Bills and Inflation (SBBI), 1982 updated
annually in the SBBI Yearbook, Ibbotson Associates, Chicago. The Fund also
may cite in its advertisements to the aggregate amount of assets committed
to index investing by pension funds and/or other institutional investors,
which currently exceeds $____ billion.
The Standard & Poor's MidCap 400 Index and the S&P Index together
represent approximately ___% of the total market capitalization of stocks
traded in the United States. From time to time, advertising materials for
the Fund may refer to Morningstar ratings and related analysis supporting
such ratings.
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 non-
assessable. Fund shares of Common Stock 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.
On November 13, 1995, the Fund, which is incorporated under the name
Peoples S&P MidCap Index Fund, Inc., began operating under the name Dreyfus
MidCap Index Fund.
The Fund will send 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 Dreyfus, P.O. Box
9671, Providence, Rhode Island 02903, serves as 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.
Boston Safe Deposit and Trust Company (the "Custodian"), an indirect
wholly-owned subsidiary of Mellon Bank Corporation, is located at One
Boston Place, Boston, Massachusetts 02108, and serves as the custodian of
the Fund. Under its Custody Agreement with the Fund, the Custodian holds
the Fund's portfolio securities and keeps all necessary accounts and
records. The Custodian's fees for its services to the Fund are paid by
Mellon Equity.
Neither the Transfer Agent nor the Custodian has any part in
determining the investment policies of the Fund or which 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 of
Common Stock 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
Description of S&P A-1 Commercial Paper Ratings:
The rating A is the highest rating and is assigned by S&P to issues
that are regarded as having the greatest capacity for timely payment.
Issues in this category are delineated with the number 1, 2 or 3 to
indicate the relative degree of safety. Paper rated A-1 indicates that the
degree of safety regarding timely payment is either overwhelming or very
strong. Those issues determined to possess overwhelming safety
characteristics are denoted with a plus (+) sign designation.
Description of Moody's Prime-1 Commercial Paper Rating :
The rating Prime-1 (P-1) is the highest commercial paper rating
assigned by Moody's. Issuers of P-1 paper must have a superior capacity
for repayment of short-term promissory obligations, and ordinarily will be
evidenced by leading market positions in well established industries, high
rates of return on funds employed, conservative capitalization structures
with moderate reliance on debt and ample asset protection, broad margins in
earnings coverage of fixed financial charges and high internal cash
generation, and well established access to a range of financial markets and
assured sources of alternate liquidity.
<PAGE>
Peoples S&P MidCap Index Fund, Inc. October 31, 1995
- ------------------------------------------------------------------------
COMPARISON OF CHANGE IN VALUE OF $10,000 INVESTMENT IN PEOPLES S&P MIDCAP
INDEX FUND, INC. WITH THE STANDARD & POOR'S MIDCAP 400 INDEX AND THE
STANDARD & POOR'S 500 COMPOSITE STOCK PRICE INDEX
[CHART]
<TABLE>
<CAPTION>
Standard & Poor's 500
People's S&P Composite Stock Standard & Poor's
Period MidCap Index Fund Price Index* MidCap 400 Index*
- ---------------- ----------------- --------------------- -----------------
<S> <C> <C> <C>
6/19/91 10,000 10,000 10,000
10/31/92 10,952 10,675 11,547
10/31/93 12,123 11,737 12,612
10/31/94 14,695 13,487 15,327
10/31/95 14,973 14,007 15,691
10/31/96 18,084 17,706 19,020
</TABLE>
*Source: Lipper Analytical Services, Inc.
Average Annual Total Returns
- -----------------------------------------------------------------------
One Year Ended From Inception (6/19/91)
October 31, 1995 to October 31, 1995
-------------------- ------------------------------
20.78% 14.52%
Past performance is not predictive of future performance.
The above graph compares a $10,000 investment made in Peoples S&P MidCap
Index Fund, Inc. on 6/19/91 (Inception Date) to a $10,000 investment made in
each of the Standard & Poor's MidCap 400 Index and the Standard and Poor's
500 Composite Stock Price Index on that date. For comparative purposes, the
value of the Indices on 6/30/91 is used as the beginning value on 6/19/91.
All dividends and capital gain distributions are reinvested.
The Fund's performance shown in the line graph takes into account all
applicable fees and expenses. The Standard & Poor's MidCap 400 Index is a
broad-based Index of 400 companies with market capitalizations generally
ranging from $50 million to $10 billion and is a widely accepted, unmanaged
index of overall midcap stock market performance. The Fund holds stocks in
generally the same proportion as the stocks within the Index itself. The
Standard & Poor's 500 Composite Stock Price Index is a widely accepted,
unmanaged index of overall stock market performance. Both indices do not
take into account charges, fees and other expenses. Further information
relating to Fund performance, including expense reimbursements, if
applicable, is contained in the Condensed Financial Information section of
the Prospectus and elsewhere in this report.
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ------------------------------------------------------------------------
Statement of Investments October 31, 1995
Shares Common Stocks--90.4% Value
-------- ------------
Basic Materials--5.9%
5,861 Albany International, Cl. A ....... $ 121,616
13,300 Albemarle ......................... 247,713
16,215 Battle Mountain Gold .............. 123,639
5,404 Betz Laboratories ................. 217,511
7,810 Bowater ........................... 345,592
3,129 Brush Wellman ..................... 52,411
7,700 Cabot ............................. 365,750
3,116 Carlisle Companies ................ 128,146
3,244 Carpenter Technology .............. 122,866
4,791 Chesapeake ........................ 146,724
2,268 Cleveland-Cliffs .................. 84,767
8,921 Consolidated Papers ............... 510,727
9,776 Crompton & Knowles ................ 123,422
4,943 Dexter ............................ 118,014
23,800 Ethyl ............................. 264,775
5,453 Ferro ............................. 126,101
4,108 First Brands ...................... 187,941
7,779 Georgia Gulf ...................... 257,679
3,324 Gibson Greetings .................. 46,120
8,900 Glatfelter (P.H.) ................. 164,650
7,168 Hanna (M.A.) ...................... 183,680
5,073 Harsco ............................ 267,601
5,761 IMC Global ........................ 403,270
9,046 Lawter International .............. 96,114
6,918 Loctite ........................... 326,875
10,436 Longview Fibre .................... 151,322
12,888 Lubrizol .......................... 370,530
2,928 Lukens ............................ 90,036
3,868 Oregon Steel Mills ................ 55,119
3,670 Pentair ........................... 185,335
7,325 Schulman (A.) ..................... 137,344
8,112(a) Sealed Air ........................ 213,954
18,430 Sonoco Products ................... 456,142
11,183(a) Sterling Chemicals ................ 89,464
5,751 Wausau Paper Mills ................ 140,900
11,316 Witco ............................. 319,677
------------
7,243,527
------------
Capital Goods/Construction--5.6%
14,996(a) AES ............................... 296,171
14,136 Allegheny Ludlum .................. 238,545
7,411 CBI Industries .................... 230,667
4,533 CalMat ............................ 76,494
7,889 Calgon Carbon ..................... 89,737
15,147 Clayton Homes ..................... 397,609
11,702 Danaher ........................... 362,762
3,119(a) Datascope ......................... 74,076
5,304 Donaldson ......................... 129,285
3,815 Duriron ........................... 102,051
6,817 Federal-Mogul ..................... 121,854
6,451 GenCorp ........................... 67,736
4,294 Goulds Pumps ...................... 101,983
2,400 Granite Construction .............. 68,100
Capital Goods/Construction (continued)
6,440 Hubbell, Cl. B .................... $ 388,010
3,244 Kaydon ............................ 93,671
5,200 Kennametal ........................ 161,850
6,879 Keystone International ............ 153,058
4,826(a) MagneTek .......................... 47,657
12,018 Mark IV Industries ................ 234,351
2,955 Measurex .......................... 90,866
3,568 Nordson ........................... 206,052
4,088 OEA ............................... 111,398
12,484(a) Parametric Technology ............. 834,868
12,009 RPM ............................... 232,674
3,649(a) Rohr Industries ................... 54,279
3,341(a) Southdown ......................... 54,291
6,426 Stewart & Stevenson Services ...... 146,192
6,213 Sundstrand ........................ 380,546
4,300 Tecumseh Products, Cl. A .......... 202,100
3,671 Thiokol ........................... 127,108
7,000 Vulcan Materials .................. 389,375
10,041(a) Weatherford Enterra ............... 242,239
8,550 York International ................ 374,062
------------
6,881,717
------------
Consumer Cyclicals--12.3%
1,832 Angelica .......................... 41,220
4,600(a) Ann Taylor Stores ................. 50,600
4,368 Arvin Industries .................. 77,532
7,732 Belo (A.H.), Cl. A ................ 267,721
8,500(a) Best Buy .......................... 176,375
15,071(a) Brinker International ............. 182,736
6,200(a) Buffets ........................... 77,500
13,000(a) Burlington Industries ............. 144,625
10,050 CML Group ......................... 57,787
2,715 CPI ............................... 49,549
13,600 Callaway Golf ..................... 222,700
8,428 Cardinal Health ................... 432,989
5,866(a) Chris-Craft Industries ............ 233,907
9,410 Cintas ............................ 395,220
21,073(a) Circus Circus Enterprises ......... 561,069
4,190 Claire's Stores ................... 82,229
26,036 Coca Cola Enterprises ............. 693,209
12,025 Cracker Barrel Old Country
Store ........................... 204,425
3,200 Cross (A.T.), Cl. A ............... 45,600
821(a) Dave & Buster's ................... 12,315
11,943 Dole Food ......................... 449,355
13,418 Dollar General .................... 328,741
5,312 Duty Free International ........... 75,696
4,405 Edison Brothers Stores ............ 15,968
11,390 Family Dollar Stores .............. 173,697
9,200 Fingerhut Companies ............... 125,350
5,200(a) Fred Meyer ........................ 96,850
9,900(a) HFS ............................... 606,375
4,219 Hancock Fabrics ................... 36,916
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ------------------------------------------------------------------------
Statement of Investments (continued) October 31, 1995
Shares Common Stocks (continued) Value
-------- ------------
Consumer Cyclicals (continued)
15,012 Harley-Davidson ................... $ 401,571
9,770 Heilig-Meyers ..................... 179,524
18,240(a) Home Shopping Network ............. 148,200
2,903 Houghton Mifflin .................. 119,023
6,984 Intelligent Electronics ........... 53,253
4,683(a) International Dairy
Queen, Cl. A .................... 99,514
26,076 International Game
Technology ...................... 303,133
3,477 International Multifoods .......... 71,278
5,200(a) Jones Apparel Group ............... 178,100
7,200(a) Kohls ............................. 326,700
5,833 Lancaster Colony .................. 193,947
6,748(a) Lands' End ........................ 101,220
4,700 Lee Enterprises ................... 187,412
16,796 Leggett & Platt ................... 403,104
5,145(a) MacFrugal's Bargains
Closeouts ...................... 61,097
5,300 Media General, Cl. A .............. 147,075
3,871 Michael Foods ..................... 46,936
4,865 Miller (Herman) ................... 144,126
18,325(a) Mirage Resorts .................... 600,144
5,820 Modine Manufacturing .............. 160,050
6,748 Morrison Restaurants .............. 105,437
7,392(a) Multimedia ........................ 327,096
7,000(a) Nine West Group ................... 311,500
29,968(a) Office Depot ...................... 857,834
8,400(a) Outback Steakhouse ................ 263,550
10,342 Promus Hotel ...................... 227,524
13,400(a) Revco D.S. ........................ 318,250
4,100 Sbarro ............................ 85,588
20,044(a) Service Merchandise ............... 107,736
27,232 Shaw Industries ................... 347,208
5,800 Superior Industries
International.................... 163,125
3,119 Tiffany & Co. ..................... 136,066
28,944 Tyson Foods, Cl. A ................ 691,038
13,737 Unifi ............................. 309,082
6,507(a) Waban ............................. 101,672
4,407 Wallace Computer Services ......... 248,445
2,269 Washington Post, Cl. B ............ 658,010
4,197(a) Western Publishing Group .......... 34,363
------------
15,137,187
------------
Consumer Staples--9.5%
5,595(a) Acuson ............................ 65,042
2,634(a) Advanced Technology
Laboratories .................... 47,412
5,512(a) Applied Bioscience
International.................... 35,139
8,031 Bergen Brunswig, Cl. A ............ 166,643
6,526(a) Biogen ............................ 399,718
8,344 Bob Evans Farms ................... 150,192
Consumer Staples (continued)
9,251 Carter-Wallace .................... $ 97,135
11,697(a) Centocor........................... 131,591
8,220(a) Chiron............................. 748,020
3,888 Church & Dwight.................... 79,218
7,960(a) Coram Healthcare................... 31,840
3,295(a) Cordis............................. 364,098
7,777 Dean Foods......................... 216,784
2,571 Diagnostic Products................ 95,127
2,514 Dreyer's Grand Ice Cream........... 86,733
8,054(a) FHP International.................. 195,310
7,678 Flowers Industries................. 166,037
9,100(a) Forest Laboratories................ 376,512
11,400(a) Foundation Health.................. 483,075
5,779(a) Genzyme-General Division........... 336,627
18,626(a) HEALTHSOUTH........................ 486,604
8,500 Hannaford Brothers................. 222,062
6,200(a) Health Care & Retirement........... 182,125
6,830(a) HealthCare COMPARE................. 252,710
6,100(a) Healthsource....................... 323,300
10,115(a) Horizon/CMS Healthcare............. 204,829
9,500 IBP................................ 568,813
23,050 IVAX............................... 524,388
24,732 Laboratory Corporation of
America Holdings................. 210,222
2,543(a) Laboratory Corporation of America
Holdings (Warrants).............. 1,589
5,945 Lance.............................. 100,322
16,336 McCormick & Co. ................... 404,316
23,898 Mylan Laboratories................. 454,062
1,717 NCH................................ 93,362
13,148(a) NovaCare........................... 82,175
6,161(a) PacifiCare Health Systems,
Cl. A............................ 448,213
15,300(a) Perrigo............................ 187,425
9,200 Ruddick............................ 117,300
5,281 Savannah Foods & Industries........ 66,012
4,700(a) Scherer (R.P.)..................... 209,150
3,000(a) Scholastic......................... 185,250
5,422 Sizzler International.............. 18,977
5,720 Smucker (J.M.), Cl. A.............. 112,255
3,778 Stanhome........................... 115,229
9,675 Stryker............................ 436,584
7,869 Surgical Care Affiliates........... 233,119
7,391 Tambrands.......................... 330,747
7,066 Universal.......................... 148,386
5,264 Universal Foods.................... 180,292
10,438(a) Value Health....................... 238,769
8,715(a) Vons Companies..................... 221,143
------------
11,631,983
------------
Diversified--5.4%
6,400(a) Air & Water Technologies,
Cl. A............................ 32,000
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ------------------------------------------------------------------------
Statement of Investments (continued) October 31, 1995
Shares Common Stocks (continued) Value
-------- ------------
Diversified (continued)
8,452(a) Altera............................. $ 511,346
9,000(a) Alumax............................. 265,500
19,000(a) Atmel.............................. 593,750
12,028(a) Cirrus Logic....................... 506,680
5,400 DENTSPLY International............. 186,300
4,384(a) Exabyte............................ 56,718
2,742 Fuller (H.B.)...................... 86,373
4,921(a) Jacobs Engineering Group........... 107,647
8,496 Kansas City Southern
Industries....................... 396,126
2,293 Lawson Products.................... 55,032
9,000(a) Litton Industries.................. 356,625
1,800(a) MAXXAM............................. 66,600
8,600 McKesson........................... 410,650
4,640(a) Octel Communications............... 158,340
4,770 Olin............................... 305,280
7,299 Omnicom Group...................... 466,224
5,800 Rayonier........................... 217,500
1,936(a) Sequa, Cl. A....................... 49,852
20,562(a) Staples............................ 547,463
3,500 Teleflex........................... 148,312
16,195 Thermo Electron.................... 744,970
9,473 Topps.............................. 58,022
4,403(a) VeriFone........................... 118,881
6,661 Wellman............................ 156,533
------------
6,602,724
------------
Energy--4.0%
10,559 American Financial Group........... 295,652
11,881 Anadarko Petroleum................. 515,338
15,236 Apache............................. 388,518
5,385(a) BJ Services........................ 126,548
5,648 Diamond Shamrock................... 145,436
6,800 El Paso Natural Gas................ 183,600
33,100(a) Global Marine...................... 215,150
16,038 Lyondell Petrochemical............. 342,812
5,830 MAPCO.............................. 300,245
13,180 MCN................................ 286,665
8,982 Murphy Oil......................... 340,193
16,900(a) Nabors Industries.................. 145,762
10,077 Noble Affiliates................... 249,406
6,800 Parker & Parsley Petroleum......... 125,800
11,137(a) Parker Drilling.................... 58,469
6,286 Quaker State....................... 82,504
8,148 Questar............................ 245,459
19,782 Ranger Oil......................... 113,747
7,020(a) Seagull Energy..................... 120,218
7,710(a) Smith International................ 123,360
7,423 Tosco.............................. 256,093
8,776 Valero Energy...................... 207,333
6,065(a) Varco International................ 55,343
------------
4,923,651
------------
Financial--13.4%
19,823 AFLAC.............................. $ 807,787
21,739 Aon................................ 894,016
8,385 Bancorp Hawaii..................... 280,898
23,657 Bear Stearns Companies............. 470,183
7,659 Central Fidelity Banks............. 237,429
9,057 City National...................... 120,005
7,106 Comdisco........................... 216,733
23,710 Comerica........................... 797,249
7,645 Crestar Financial.................. 435,765
6,054 Dauphin Deposit.................... 175,566
12,383 Edwards (A.G.)..................... 315,766
13,090 Fifth Third Bancorp................ 880,302
10,006 First Security..................... 327,697
6,986 First Tennessee National........... 373,751
6,606 First Virginia Banks............... 270,020
12,610 First of America Bank.............. 537,501
16,208 Franklin Resources................. 822,556
27,400 Green Tree Financial............... 729,525
4,096 Hartford Steam Boiler
Inspection & Insurance........... 190,976
23,700 Hibernia, Cl.A..................... 234,037
6,976 Kemper............................. 338,336
18,591 Marshall & Ilsley.................. 450,832
11,031 Mercantile Bancorporation.......... 485,364
9,534 Mercantile Bankshares.............. 262,185
11,577 Meridian Bancorp................... 494,917
11,224 Northern Trust..................... 535,946
20,000 Paine Webber Group................. 440,000
14,387 Progressive........................ 597,061
9,164 Provident Life & Accident
Insurance Co. of America......... 245,137
9,214 Regions Financial.................. 367,408
34,348 Schwab (Charles)................... 785,711
11,218 Sotheby's Holdings, Cl. A.......... 155,650
17,395 SouthTrust......................... 437,049
16,642 State Street Boston................ 646,958
4,625 Transatlantic Holdings............. 311,609
11,042 UJB Financial...................... 351,964
7,764 West One Bancorp................... 329,970
6,900 Wilmington Trust................... 203,550
------------
16,557,409
------------
Technology--15.6%
6,722 AMETEK............................. 118,475
8,882(a) AST Research....................... 78,828
14,309 Adobe Systems...................... 815,613
18,600(a) American Power Conversion.......... 190,650
15,147(a) Analog Devices..................... 547,185
9,331(a) Arrow Electronics.................. 473,548
8,604 Avnet.............................. 433,426
10,110(a) BMC Software....................... 360,169
22,954(a) Bay Networks....................... 1,520,702
5,812 Beckman Instruments................ 192,522
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ------------------------------------------------------------------------
Statement of Investments (continued) October 31, 1995
Shares Common Stocks (continued) Value
-------- ------------
Technology (continued)
5,611(a) Borland International.............. $ 76,450
11,138(a) Cadence Design System.............. 359,184
10,100(a) California Energy.................. 183,063
9,100(a) Compuware.......................... 207,025
10,508(a) Conner Peripherals................. 189,144
5,204(a) Convex Computer.................... 23,418
8,259(a) Cypress Semiconductor.............. 291,130
17,974(a) Dell Computer...................... 838,038
42,900(a) EMC................................ 664,950
10,200(a) Electronic Arts.................... 373,575
9,113 Federal Signal..................... 203,903
8,700(a) Fiserv............................. 224,025
6,161 HON Industries..................... 170,968
5,396(a) Information Resources.............. 58,682
26,500(a) Informix........................... 771,812
15,000(a) Integrated Device Technology....... 285,000
25,396(a) LSI Logic.......................... 1,196,787
14,340 Linear Technology.................. 627,375
10,509(a) Mentor Graphics.................... 220,689
6,200(a) Micro Warehouse.................... 275,900
20,313 Molex.............................. 670,329
38,400(a) NEXTEL Communications.............. 532,800
1,504 National Presto Industries......... 60,912
5,615(a) Nellcor............................ 322,862
4,023 Precision Castparts................ 143,822
10,253(a) Quantum............................ 178,146
8,276 Reynolds & Reynolds, Cl. A......... 294,833
14,204(a) Seagate Technology................. 635,629
14,621 Sensormatic Electronics............ 312,524
6,182(a) Sequent Computer Systems........... 107,412
9,000(a) Solectron.......................... 362,250
5,607 Standard Register.................. 126,158
10,513(a) Storage Technology................. 258,883
4,594(a) Stratus Computer................... 142,988
5,966(a) Structural Dynamics Research....... 108,880
7,676(a) Symantec........................... 186,623
5,216(a) Symbol Technologies................ 181,908
15,044(a) Teradyne........................... 502,093
8,000 U.S. Robotics...................... 740,000
6,738 Varian Associates.................. 346,165
11,500(a) Vishay Intertechnology............. 405,375
14,166(a) Xilinx............................. 651,636
------------
19,244,464
------------
Transport & Services--4.4%
4,269 Airborne Freight................... 112,061
2,587(a) Alaska Air Group................... 38,482
9,157 Alexander & Baldwin................ 210,611
6,312 American President
Companies........................ 153,066
5,200 Arnold Industries.................. 84,500
6,680 Atlantic Southeast Airlines........ 165,330
Transport & Services (continued)
4,024 Banta.............................. $ 174,038
5,923 Diebold............................ 313,919
3,261 Ennis Business Forms............... 46,469
15,255 Equifax............................ 594,945
6,088 FlightSafety International......... 290,702
3,973 GATX............................... 188,718
7,500 Hunt (JB) Transport................ 116,250
8,241 Illinois Central, Cl. A............ 315,218
7,385 Kelly Services, Cl. A.............. 185,548
15,100 Manpower........................... 409,587
8,400 Olsten............................. 323,400
7,070 Overseas Shipholding Group......... 120,190
3,340 PHH................................ 146,125
9,012 Paychex............................ 390,896
3,877(a) Policy Management Systems.......... 182,704
7,005 Rollins............................ 147,105
12,100(a) Rollins Environmental Services..... 40,837
10,705 Tidewater.......................... 282,344
8,251 Trinity Industries................. 244,436
5,782 Watts Industries, Cl. A............ 119,254
------------
5,396,735
------------
Utilities--14.3%
12,356(a) ADC Telecommunications............. 494,240
24,022 Allegheny Power System............. 633,580
5,531 Atlanta Gas Light.................. 213,635
10,854 Atlantic Energy.................... 210,296
2,895 Black Hills........................ 72,737
9,694 Brooklyn Union Gas................. 243,562
17,645 CMS Energy......................... 487,443
4,520 Central Louisiana Electric......... 121,475
6,315 Central Maine Power................ 87,621
11,758 Century Telephone
Enterprises...................... 340,982
9,436 Comsat............................. 187,541
12,034 Delmarva Power & Light............. 264,748
19,216 Florida Progress................... 636,530
32,022 Frontier........................... 864,594
5,829 Hawaiian Electric Industries....... 227,331
7,634 IPALCO Enterprises................. 281,504
7,583 Idaho Power........................ 210,428
15,176 Illinova........................... 430,619
4,494 Indiana Energy..................... 94,936
12,480 Kansas City Power & Light.......... 310,440
6,607 LG & E Energy...................... 274,191
7,368 Lincoln Telecommunications......... 127,098
20,733 MidAmerican Energy................. 331,737
6,137 Minnesota Power & Light............ 175,672
10,715 Montana Power...................... 243,766
12,848 NIPSCO Industries.................. 468,952
7,537 National Fuel Gas.................. 224,226
9,211 Nevada Power....................... 201,491
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ------------------------------------------------------------------------
Statement of Investments (continued) October 31, 1995
Shares Common Stocks (continued) Value
-------- ------------
Utilities (continued)
13,016 New England Electric System........ $ 507,624
14,388 New York State Electric & Gas...... 363,297
25,160 Northeast Utilities................ 622,710
7,873 Oklahoma Gas & Electric............ 314,920
17,536 Pinnacle West Capital.............. 482,240
10,157 Portland General Electric.......... 275,509
23,783 Potomac Electric Power............. 594,575
12,681 Public Service Co. of Colorado..... 432,739
8,394(a) Public Service Co. of
New Mexico....................... 140,600
12,790 Puget Sound Power & Light.......... 290,972
20,464 SCANA.............................. 519,274
12,983 Southern New England
Telecommunications............... 469,011
7,982 Southwestern Public Service........ 262,408
4,948 TCA Cable TV....................... 146,584
23,418 TECO Energy........................ 553,250
11,400 Telephone & Data Systems........... 456,000
9,000 UtiliCorp United................... 259,875
8,757(a) Vanguard Cellular Systems,
Cl. A............................ 195,938
5,979 WPL Holdings....................... 182,360
8,560 Washington Gas Light............... 163,710
21,987 Wisconsin Energy................... 648,616
37,978(a) WorldCom........................... 1,239,032
------------
17,582,619
------------
TOTAL COMMON STOCKS
(cost $94,059,436)............... $111,202,016
------------
------------
CONVERTIBLE PREFERRED
STOCKS--0.0%
Financial;
223(a,b) Everen, Series A, 13.50%
(cost $4,795).................... $ 4,823
------------
------------
Principal SHORT-TERM
Amount INVESTMENTS--10.0%
---------
U.S. Treasury Bills--.2%
$ 200,000(c) 5.99%, 4/4/96 ..................... $ 195,422
------------
Repurchase Agreements--9.8%
12,072,000 Paine Webber, Inc.
5.80% Dated 10/31/95,
Due 11/1/95 in the amount
of $12,073,945 (fully
collateralized by $11,995,000
U.S. Treasury Notes,
6.875%, 2/28/97,
value $12,322,494)............... 12,072,000
------------
TOTAL SHORT-TERM
INVESTMENTS
(cost $12,267,415)............... $ 12,267,422
------------
TOTAL INVESTMENTS
(cost $106,331,646).......................... 100.4% $123,474,261
------ ------------
------ ------------
LIABILITIES, LESS CASH
AND RECEIVABLES.............................. (.4%) $ (492,606)
------ ------------
------ ------------
NET ASSETS .................................... 100.0% $122,981,655
------ ------------
------ ------------
Notes to Statement of Investments:
(a) Non-income producing.
(b) Convertible into Everen Capital bond, 13.50%, 9/15/2007.
(c) Wholly held by custodian in a segregated account as collateral for
open financial futures positions.
Statement of Financial Futures October 31, 1995
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Market Value Unrealized
Number of Covered (Depreciation)
Financial Futures Long Contracts by Contracts Expiration at 10/31/95
- -------------------------- ------------ ------------- -------------- -------------
<S> <C> <C> <C> <C>
Standard & Poor's MidCap 400................. 113 $11,893,250 Dec. '95 $(421,685)
==========
</TABLE>
See notes to financial statements.
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- -------------------------------------------------------------
Statement of Assets and Liabilities October 31, 1995
<TABLE>
<S> <C> <C>
ASSETS:
Investments in securities, at value--Note 1(b)
(cost $106,331,646)--see statement................................... $123,474,261
Cash129,720
Dividends and interest receivable....................................... 109,090
Prepaid expenses........................................................ 12,826
Due from The Dreyfus Corporation........................................ 34,573
------------
123,760,470
LIABILITIES:
Due to World Asset Management........................................... $ 10,499
Payable for investment securities purchased............................. 339,758
Payable for Common Stock redeemed....................................... 244,069
Payable for futures variation margin--Note 3(a)......................... 53,675
Accrued expenses........................................................ 130,814 778,815
--------- ------------
NET ASSETS ................................................................ $122,981,655
------------
------------
REPRESENTED BY:
Paid-in capital......................................................... $ 99,269,656
Accumulated undistributed investment income--net........................ 1,487,878
Accumulated undistributed net realized gain on investments.............. 5,503,191
Accumulated net unrealized appreciation on investments [including
($421,685) net unrealized (depreciation) on financial futures]
--Note 3(b)........................................................... 16,720,930
------------
NET ASSETS at value applicable to 6,337,980 shares outstanding
(200 million shares of $.001 par value Common Stock authorized)......... $122,981,655
------------
------------
NET ASSET VALUE, per share
($122,981,655 # 6,337,980 shares)....................................... $19.40
------
------
</TABLE>
See notes to financial statements.
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- -----------------------------------------------------------------
Statement of Operations year ended October 31, 1995
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Income:
Cash dividends (net of $399 foreign taxes withheld at source)......... $1,853,716
Interest.............................................................. 397,096
----------
Total Income.................................................... $2,250,812
Expenses:
Index management fee--Note 2(a)....................................... 98,063
Administration fee--Note 2(a)......................................... 294,190
Shareholder servicing costs--Note 2(b)................................ 188,998
Registration fees..................................................... 56,590
Legal fees............................................................ 41,695
Auditing fees......................................................... 41,364
Custodian fees--Note 2(a)............................................. 37,560
Prospectus and shareholders' reports.................................. 25,840
Directors' fees and expenses--Note 2(c)............................... 23,176
Miscellaneous......................................................... 23,844
----------
831,320
Less--reduction in management fee and administration fee from World and
Dreyfus due to undertakings and redemption fee--Note 2(a).......... 345,273
----------
Total Expenses.................................................. 486,047
-----------
INVESTMENT INCOME--NET........................................... 1,764,765
-----------
REALIZED AND UNREALIZED GAIN ON INVESTMENTS:
Net realized gain on investments--Note 3(a)............................. $4,284,157
Net realized gain on financial futures--Note 3(a);
Long transactions..................................................... 1,364,616
----------
Net Realized Gain..................................................... 5,648,773
Net unrealized appreciation on investments [including ($436,655)
net unrealized (depreciation) on financial futures]................... 11,878,944
-----------
NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................. 17,527,717
-----------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $19,292,482
-----------
-----------
</TABLE>
See notes to financial statements.
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ---------------------------------------------------------------
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended October 31,
---------------------------------
1994 1995
------------- -------------
<S> <C> <C>
OPERATIONS:
Investment income--net............................................ $ 1,227,409 $ 1,764,765
Net realized gain on investments.................................. 3,427,593 5,648,773
Net unrealized appreciation (depreciation) on investments for
the year........................................................ (3,340,443) 11,878,944
------------ ------------
Net Increase In Net Assets Resulting From Operations............ 1,314,559 19,292,482
------------ ------------
DIVIDENDS TO SHAREHOLDERS FROM:
Investment income--net............................................. (1,123,649) (1,274,372)
Net realized gain on investments.................................. (2,309,722) (3,413,496)
------------ ------------
Total Dividends................................................. (3,433,371) (4,687,868)
------------ ------------
CAPITAL STOCK TRANSACTIONS:
Net proceeds from shares sold..................................... 61,712,647 44,222,299
Dividends reinvested.............................................. 3,142,822 4,181,647
Cost of shares redeemed........................................... (53,021,949) (15,431,258)
------------ ------------
Increase In Net Assets From Capital Stock Transactions.......... 11,833,520 32,972,688
------------ ------------
Total Increase In Net Assets.................................. 9,714,708 47,577,302
NET ASSETS:
Beginning of year................................................. 65,689,645 75,404,353
------------ ------------
End of year (including undistributed investment income-net:
$997,485 in 1994 and $1,487,878 in 1995)........................ $ 75,404,353 $122,981,655
------------ ------------
------------ ------------
Shares Shares
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Shares sold....................................................... 3,634,804 2,528,662
Shares issued for dividends reinvested............................ 182,828 270,132
Shares redeemed................................................... (3,144,607) (859,974)
------------ ------------
Net Increase In Shares Outstanding.............................. 673,025 1,938,820
------------ ------------
------------ ------------
</TABLE>
See notes to financial statements.
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ----------------------------------------------------------------------
Financial Highlights
Reference is made to page __ of the Funds' Prospectus dated
See notes to financial statements.
<PAGE>
Peoples S&P MidCap Index 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. World Asset
Management ("World"), a Delaware general partnership the majority general
partner of which is Munder Capital Management, serves as the Fund's index
manager. Prior to December 31, 1994, World Asset Management, Inc. served as
the Fund's index manager. Comerica Bank serves as the Fund's custodian. The
Dreyfus Corporation ("Dreyfus") serves as the Fund's administrator. Dreyfus
is a direct subsidiary of Mellon Bank, N.A. Premier Mutual Fund Services,
Inc. (the "Distributor") acts as the distributor of the Fund's shares, which
are sold without a sales charge. 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.
On April 24, 1995, a special meeting of the Fund's stockholders was held
for the purpose of approving a new index management agreement with World. A
total of 3,255,496 shares of common stock were represented at the meeting,
3,089,961 of such shares were voted in favor of the proposal, 28,644 shares
were voted against the proposal and 136,891 shares abstained from voting.
Effective November 13,1995, the Fund will operate under the name Dreyfus
MidCap Index Fund and Dreyfus will serve as the Fund's manager and Mellon
Equity Associates, an affiliate of Dreyfus ("Mellon Equity"), will serve as
the Fund's index manager. In addition, Boston Safe Deposit and Trust Company,
an affiliate of Dreyfus, will serve as the Fund's custodian.
(a) Portfolio valuation: Investments in securities (including options and
financial futures) are valued at the last sales price on the securities
exchange on which such securities are primarily traded or at the last sales
price on the national securities market. Securities not listed on an
exchange or the national securities market, or securities for which there
were no transactions, are valued at the average of the most recent bid and
asked prices. Bid price is used when no asked price is available.
Investments denominated in foreign currencies are translated to U.S. dollars
at the prevailing rates of exchange.
(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. Dividend
income is recognized on the ex-dividend date and interest income, including,
where applicable, amortization of discount on investments, is recognized on
the accrual basis.
The Fund may enter into repurchase agreements with financial
institutions, deemed to be creditworthy by the Fund's index manager, subject
to the seller's agreement to repurchase and the Fund's agreement to resell
such securities at a mutually agreed upon price. Securities purchased
subject to repurchase agreements are deposited with the Fund's custodian and,
pursuant to the terms of the repurchase agreement, must have an aggregate
market value greater than or equal to the repurchase price plus accrued intere
st at all times. If the value of the underlying securities falls below the
value of the repurchase price plus accrued interest, the Fund will require
the seller to deposit additional collateral by the next business day. If the
request for additional collateral is not met, or the seller defaults on its
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
repurchase obligation, the Fund maintains the right to sell the
underlying securities at market value and may claim any resulting loss
against the seller.
(c) Dividends to shareholders: Dividends are recorded on the ex-dividend
date. Dividends from investment income-net and 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, if any, 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, if such qualification is in the
best interests of its shareholders, by complying with the applicable
provisions of the Internal Revenue Code, and to make distributions of taxable
income sufficient to relieve it from substantially all Federal income and
excise taxes.
NOTE 2--Management Fee, Administration Fee and Other Transactions With
Affiliates:
(a) Fees paid by the Fund pursuant to the provisions of an Index
Management Agreement with World and an Administration Agreement with Dreyfus
are payable monthly. World and Dreyfus receive annual fees of .10 of 1% and
.30 of 1%, respectively, of the average daily value of the Fund's net assets.
The agreements further provide that if the aggregate expenses of the Fund,
exclusive of interest, taxes, brokerage and extraordinary expenses, exceed
the expense limitation of any state having jurisdiction over the Fund, the
Fund may deduct from the fees to be paid to each of World and Dreyfus, or
World and Dreyfus will each bear, such excess expense in proportion to their
respective fees. The most stringent state expense limitation applicable to
the Fund presently requires reimbursement of expenses in any full fiscal year
that such expenses (exclusive of certain expenses as described above) exceed
2-1/2% of the first $30 million, 2% of the next $70 million and 1-1/2% of the
excess over $100 million of the average value of the Fund's net assets in
accordance with California "blue sky" regulations. However, World and Dreyfus
had undertaken from November 1, 1994 through November 7, 1994, to waive the
index management fee and administration fee. World and Dreyfus had currently
undertaken from November 8, 1994 through June 4, 1995 with respect to World
and through October 31, 1996 with respect to Dreyfus, to reduce the
management fee and administration fee paid by the Fund (exclusive of certain
expenses as described above), and to assume all expenses in excess of an
annual rate of .50 of 1% of the average daily value of the Fund's net assets.
For the year ended October 31, 1995, pursuant to the undertakings, World
waived $39,687 of its index management fee and Dreyfus waived $301,166 of its
administration fee. In addition, Comerica Bank earned $37,560 for custodian
services provided to the Fund. For the year ended October 31, 1995, the Fund
received $4,421 in redemption fees.
(b) Pursuant to the Fund's Shareholder Services Plan, the Fund reimburses
Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager, an
amount not to exceed an annual rate of .25 of 1% of the value of the Fund's
average daily net assets for certain allocated expenses of providing personal
services and/or maintaining shareholder accounts. The services provided may
include personal services relating to shareholder accounts, such as answering
shareholder inquiries regarding the Fund and
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ----------------------------------------------------------------------
NOTES TO FINANCIAL STATEMENTS (continued)
providing reports and other information, and services related to the
maintenance of shareholder accounts. During the year ended October 31, 1995,
the Fund was charged an aggregate of $134,490 pursuant to the Shareholder
Services 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 $500
per meeting. The Chairman of the Board receives an additional 25% of such
compensation.
NOTE 3--Securities Transactions:
(a) The aggregate amount of purchases and sales of investment securities,
other than short-term securities, for the year ended October 31, 1995
amounted to $42,217,509 and $18,725,504, respectively.
The Fund may invest in financial futures contracts in order to gain
exposure to or protect against changes in the market. The Fund is exposed to
market risk as a result of changes in the value of the underlying financial
instruments (see the Statement of Financial Futures). Investments in
financial futures require the Fund to "mark to market" on a daily basis,
which reflects the change in the market value of the contract at the close of
each day's trading. Accordingly, variation margin payments are made or
received to reflect daily unrealized gains or losses. When the contracts are
closed, the Fund recognizes a realized gain or loss. These investments
require initial margin deposits with a custodian, which consist of cash or
cash equivalents, up to approximately 10% of the contract amount. The amount
of these deposits is determined by the exchange or Board of Trade on which
the contract is traded and is subject to change. Contracts open at October
31, 1995 and their related unrealized market (depreciation) are set forth in
the Statement of Financial Futures.
(b) At October 31, 1995, accumulated net unrealized appreciation on
investments was $16,720,930, consisting of $23,482,956 gross unrealized
appreciation and $6,762,026 gross unrealized depreciation.
At October 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).
<PAGE>
Peoples S&P MidCap Index Fund, Inc.
- ----------------------------------------------------------------------
Report of Ernst & Young, LLP, Independent Auditors
Shareholders and Board of Directors
Peoples S&P MidCap Index Fund, Inc.
We have audited the accompanying statement of assets and liabilities of
Peoples S&P MidCap Index Fund, Inc., including the statements of investments
and financial futures, as of October 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 verification by
examination of securities held by the custodian as of October 31, 1995 and
confirmation of securities not held by the custodian by correspondence with
brokers. 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 Peoples S&P MidCap Index Fund, Inc. at October 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 & Young LLP
New York, New York
December 7, 1995
PEOPLES S&P MIDCAP INDEX 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 June 19,
1991 (commencement of operations) to October 31, 1991 and
for the fiscal years ended October 31, 1992, 1993, 1994 and
1995.
Included in Part B of the Registration Statement:
Statement of Investments--October 31, 1995.
Statement of Financial Futures--October 31, 1995.
Statement of Assets and Liabilities--October 31, 1995.
Statement of Operations--year ended October 31, 1995.
Statement of Changes in Net Assets--For the fiscal
years ended October 31, 1994 and 1995.
Notes to Financial Statements.
Report of Independent Auditors, dated December 7, 1995.
Schedule Nos. 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 is incorporated by reference to Exhibit
(1)(a) of Post-Effective Amendment No. 4 to the Registration
Statement on Form N-1A, filed on January 13, 1994.
(1)(b) Articles of Amendment to the Articles of Incorporation is
incorporated by reference to Exhibit (1)(b) of Post-Effective
Amendment No. 4 to the Registration Statement on Form N-1A, filed
on January 13, 1994.
(2) By-Laws are incorporated by reference to Exhibit (2) of Post-
Effective Amendment No. 4 to the Registration Statement on Form
N-1A, filed on January 13, 1994.
(5)(a) Management Agreement.
(5)(b) Index Management Agreement.
(6) Distribution Agreement is incorporated by reference to Exhibit
(6) of Post-Effective Amendment No. 5 to the Registration
Statement on Form N-1A, filed on December 29, 1994.
(8) The Custody Agreement is incorporated by reference to Exhibit (8)
of Pre-Effective Amendment No. 1 to the Registration Statement on
Form N-1A, filed on June 19, 1991.
(9) Shareholder Services Plan is incorporated by reference to Exhibit
(9) of Post-Effective Amendment No. 5 to the Registration
Statement on Form N-1A, filed on December 29, 1994.
(10) Opinion and consent of Stroock & Stroock & Lavan dated June 19,
1991 is incorporated by reference to Exhibit (10) of
Post-Effective Amendment No. 4 to the Registration Statement on
Form N-1A, filed on January 13, 1994.
(11) Consent of Ernst & Young LLP, Independent Auditors.
Item 24. Financial Statements and Exhibits. - List (continued)
_______ _____________________________________________________
Other Exhibits
______________
(a) Powers of Attorney of the Directors and officers are
incorporated by reference to Other Exhibits (a) of
Post-Effective Amendment No. 5 to the Registration
Statement on Form N-1A, filed on December 29, 1994.
(b) Certificate of Secretary is incorporated by reference
to Other Exhibits (b) of Post-Effective Amendment No. 5
to the Registration Statement on Form N-1A, filed on
December 29, 1994.
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 December 22, 1995
______________ _______________________________
Common Stock
(Par value $.01) ________
Item 27. Indemnification
_______ _______________
The Statement as to the general effect of any contract,
arrangements or statute under which a director, officer,
underwriter oraffiliated person of the Registrant is insured or
indemnified is incorporated by reference to Item 27 of Part II of
Pre-Effective Amendment No. 1 to the Registration Statement on
Form N-1A, filed on June 19, 1991.
Reference is also made to the Distribution Agreement attached as
Exhibit (6) of Post-Effective Amendment No. 5 to the Registration
Statement on Form N-1A, filed on December 29, 1994.
Item 28(a). 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, serves primarily as a
registered broker-dealer of shares of investment companies
sponsored by Dreyfus and of other investment companies for
which Dreyfus acts as investment adviser, sub-investment
adviser or administrator. Dreyfus Management, Inc., another
wholly-owned subsidiary, provides investment management
services to various pension plans, institutions and
individuals.
Item 28(a). 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 of
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
DAVID B. TRUMAN Educational consultant;
Director Past President of the Russell Sage Foundation
230 Park Avenue
New York, New York 10017;
Past President of Mount Holyoke College
South Hadley, Massachusetts 01075;
DAVID B. TRUMAN Former Director:
(cont'd) Student Loan Marketing Association
1055 Thomas Jefferson Street, N.W.
Washington, D.C. 20006;
Former Trustee:
College Retirement Equities Fund
730 Third Avenue
New York, New York 10017
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 Director Deputy Director:
Mellon Trust****
Chief Executive Officer:
The Boston Company Asset Management,
Inc.*****
President:
Boston Safe Deposit and Trust
Company*****
STEPHEN E. CANTER Former Chairman and Chief Executive Officer:
Vice Chairman and Kleinwort Benson Investment Management
Chief Investment Officer, Americas Inc.*
and a Director Director:
The Dreyfus Trust Company++
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 & Trust*****
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*;
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
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++
HENRY D. GOTTMANN Executive Vice President:
Vice President-Retail Dreyfus Service Corporation*;
Sales and Service Vice President:
Dreyfus Precious Metals, Inc.*
DANIEL C. MACLEAN Director, Vice President and Secretary:
Vice President and General Dreyfus Precious Metals, Inc.*;
Counsel Director and Vice President:
The Dreyfus Consumer Credit
Corporation*;
Director and Secretary:
Dreyfus Acquisition Corporation*;
Dreyfus Partnership Management, Inc.*;
Major Trading Corporation*;
The Truepenny Corporation+;
Director, Vice President and Treasurer:
Lion Management, Inc.*;
Director:
The Dreyfus Trust Company++;
Secretary:
Dreyfus Service Corporation*;
Dreyfus Service Organization, Inc.***;
Seven Six Seven Agency, Inc.*
JEFFREY N. NACHMAN None
Vice President-Mutual Fund
Accounting
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
KATHERINE C. WICKHAM Formerly, Assistant Commissioner:
Vice President- Department of Parks and Recreation of the
Human Resources City of New York
830 Fifth Avenue
New York, New York 10022
MARK N. JACOBS Vice President, Secretary and Director:
Vice President- Lion Management, Inc.*;
Legal and Secretary 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 28(b). Business and Other Connections of Sub-Investment Adviser
________ ___________________________________________________________
Registrant is fulfilling the requirement of this Item 28(b) to
provide a list of the officers and directors of Mellon Equity
Associates, the Registrant's sub-investment adviser (the "Sub-
Adviser"), together with information as to any other business,
profession, vocation or employment of a substantial nature
engaged in by the Sub-Adviser or those of its officers and
directors during the past two years, by incorporating by
reference the information contained in the Form ADV filed with
the SEC pursuant to the Investment Advisers Act of 1940 by the
Sub-Adviser (SEC File No. 801-28692).
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, L.P. (A Strategic 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 Short-Term Income Fund, Inc.
68) The Dreyfus Socially Responsible Growth Fund, Inc.
69) Dreyfus S&P 500 Index Fund
70) Dreyfus Strategic Growth, L.P.
71) Dreyfus Strategic Income
72) Dreyfus Strategic Investing
73) Dreyfus Tax Exempt Cash Management
74) The Dreyfus Third Century Fund, Inc.
75) Dreyfus Treasury Cash Management
76) Dreyfus Treasury Prime Cash Management
77) Dreyfus Variable Investment Fund
78) Dreyfus-Wilshire Target Funds, Inc.
79) Dreyfus Worldwide Dollar Money Market Fund, Inc.
80) General California Municipal Bond Fund, Inc.
81) General California Municipal Money Market Fund
82) General Government Securities Money Market Fund, Inc.
83) General Money Market Fund, Inc.
84) General Municipal Bond Fund, Inc.
85) General Municipal Money Market Fund, Inc.
86) General New York Municipal Bond Fund, Inc.
87) General New York Municipal Money Market Fund
88) Pacifica Funds Trust -
Pacifica Prime Money Market Fund
Pacifica Treasury Money Market Fund
89) Premier California Municipal Bond Fund
90) Premier Capital Growth Fund, Inc.
91) Premier Global Investing, Inc.
92) Premier GNMA Fund
93) Premier Growth Fund, Inc.
94) Premier Insured Municipal Bond Fund
95) Premier Municipal Bond Fund
96) Premier New York Municipal Bond Fund
97) Premier State Municipal Bond 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
Margaret Pardo++ Legal Assistant 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 Group, Inc.,
a subsidiary of First Data Corporation
P.O. Box 9671
Providence, Rhode Island 02940-9671
2. Boston Safe Deposit and Trust Company
One Boston Place
Boston, Massachusetts 02108
3. Dreyfus Transfer, Inc.
One American Express Plaza
Providence, Rhode Island 02903
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 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 29th day of December, 1995.
PEOPLES S&P MIDCAP INDEX 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 12/29/95
___________________________ Executive, Financial and Accounting
Marie E. Connolly Officer)
/s/Joseph DiMartino* Director, Chairman of the Board 12/29/95
___________________________
Joseph DiMartino
/s/David P. Feldman* Director 12/29/95
___________________________
David P. Feldman
/s/Jack R. Meyer* Director 12/29/95
_____________________________
Jack R. Meyer
/s/John Szarkowski* Director 12/29/95
_____________________________
John Szarkowski
/s/Anne Wexler* Director 12/29/95
_____________________________
Anne Wexler
*BY: /s/ Eric B. Fischman
__________________________
Eric B. Fischman,
Attorney-in-Fact
EXHIBIT INDEX
ITEM EXHIBIT PAGE
(5)(a) Management Agreement
(5)(b) Index Management Agreement.
(11) Consent of Ernst & Young LLP, Independent Accountants.
MANAGEMENT AGREEMENT
PEOPLES S&P MIDCAP INDEX FUND, INC.
(d/b/a Dreyfus MidCap Index Fund)
200 Park Avenue
New York, New York 10166
November 13, 1995
The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Dear Sirs:
The above-named investment company (the "Fund")
herewith confirms its agreement with you as follows:
The Fund desires to employ its capital by investing and
reinvesting the same in investments of the type and in accordance
with the limitations specified in its charter documents and in
its Prospectus and Statement of Additional Information as from
time to time in effect, copies of which have been or will be
submitted to you, and in such manner and to such extent as from
time to time may be approved by the Fund's Board. The Fund
desires to employ you to act as its manager.
In this connection it is understood that from time to
time you will employ or associate with yourself such person or
persons as you may believe to be particularly fitted to assist
you in the performance of this Agreement. Such person or persons
may be officers or employees who are employed by both you and the
Fund. The compensation of such person or persons shall be paid
by you and no obligation may be incurred on the Fund's behalf in
any such respect. We have discussed and concur in your employing
on this basis Mellon Equity Associates to act as the Fund's index
manager (the "Index Manager") to provide day-to-day management of
the Fund's investments.
Subject to the supervision and approval of the Fund's
Board, you will provide investment management of the Fund's
portfolio in accordance with the Fund's investment objective and
policies as stated in its Prospectus and Statement of Additional
Information as from time to time in effect. In connection
therewith, you will supervise the continuous program of
investment, evaluation and, if appropriate, sale and reinvestment
of the Fund's assets conducted by the Index Manager. You and the
Index Manager are authorized to invest the Fund's assets in
securities issued by Mellon Bank Corporation, to the extent
required or permitted by the Fund's investment objective and
policies, and to the extent permitted by the U.S. Securities and
Exchange Commission or other applicable authority. You will
furnish to the Fund such statistical information, with respect to
the investments which the Fund may hold or contemplate
purchasing, as the Fund may reasonably request. The Fund wishes
to be informed of important developments materially affecting its
portfolio and shall expect you, on your own initiative, to
furnish to the Fund from time to time such information as you may
believe appropriate for this purpose.
In addition, you will supply office facilities (which
may be in your own offices), data processing services, clerical,
accounting and bookkeeping services, internal auditing and legal
services, internal executive and administrative services, and
stationery and office supplies; prepare reports to the Fund's
stockholders, tax returns, reports to and filings with the
Securities and Exchange Commission and state Blue Sky
authorities; calculate the net asset value of the Fund's shares;
and generally assist in all aspects of the Fund's operations.
You shall have the right, at your expense, to engage other
entities to assist you in performing some or all of the
obligations set forth in this paragraph, provided each such
entity enters into an agreement with you in form and substance
reasonably satisfactory to the Fund. You agree to be liable for
the acts or omissions of each such entity to the same extent as
if you had acted or failed to act under the circumstances.
You shall exercise your best judgment in rendering the
services to be provided to the Fund hereunder and the Fund agrees
as an inducement to your undertaking the same that neither you
nor the Index Manager shall be liable hereunder for any error of
judgment or mistake of law or for any loss suffered by the Fund,
provided that nothing herein shall be deemed to protect or
purport to protect you or the Index Manager against any liability
to the Fund or to its security holders to which you would
otherwise be subject by reason of willful misfeasance, bad faith
or gross negligence in the performance of your duties hereunder,
or by reason of your reckless disregard of your obligations and
duties hereunder, or to which the Index Manager would otherwise
be subject by reason of willful misfeasance, bad faith or gross
negligence in the performance of its duties under its Index
Management Agreement with you or by reason of its reckless
disregard of its obligations and duties under said Agreement.
In consideration of services rendered pursuant to this
Agreement, the Fund will pay you on the first business day of
each month a fee at the annual rate of .395 of 1% of the value of
the Fund's average daily net assets. Net asset value shall be
computed on such days and at such time or times as described in
the Fund's then-current Prospectus and Statement of Additional
Information. The fee for the period from the date hereof to the
end of the month hereof shall be pro-rated according to the
proportion which such period bears to the full monthly period,
and upon any termination of this Agreement before the end of any
month, the fee for such part of a month shall be pro-rated
according to the proportion which such period bears to the full
monthly period and shall be payable upon the date of termination
of this Agreement.
For the purpose of determining fees payable to you, the
value of the Fund's net assets shall be computed in the manner
specified in the Fund's charter documents for the computation of
the value of the Fund's net assets.
You will bear all expenses in connection with the
performance of your services under this Agreement and will pay
all fees of the Index Manager in connection with its duties in
respect of the Fund. You will also pay for, or otherwise arrange
for the payment of, the custody services to be provided to the
Fund by Boston Safe Deposit and Trust Company. All other
expenses to be incurred in the operation of the Fund (other than
those borne by the Index Manager) will be borne by the Fund,
except to the extent specifically assumed by you. The expenses
to be borne by the Fund include, without limitation, the
following: organizational costs, 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 you or any of
your affiliates, Securities and Exchange Commission fees and
state Blue Sky qualification fees, advisory fees, transfer and
dividend disbursing agents' fees, certain insurance premiums,
industry association fees, outside auditing and legal expenses,
costs of independent pricing services, costs of maintaining the
Fund's existence, costs attributable to investor services
(including, without limitation, telephone and personnel
expenses), costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes and
for distribution to existing stockholders, costs of stockholders'
reports and meetings, and any extraordinary expenses.
If in any fiscal year the aggregate expenses of the
Fund (including fees pursuant to this Agreement, but excluding
interest, taxes, brokerage and, with the prior written consent of
the necessary state securities commissions, extraordinary
expenses) exceed the expense limitation of any state having
jurisdiction over the Fund, the Fund may deduct from the fees to
be paid hereunder, or you will bear, such excess expense to the
extent required by state law. Your obligation pursuant hereto
will be limited to the amount of your fees hereunder. 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 Fund understands that you and the Index Manager now
act, and that from time to time hereafter you or the Index
Manager may act, as investment adviser to one or more other
investment companies and fiduciary or other managed accounts, and
the Fund has no objection to your and the Index Manager's so
acting, provided that when the purchase or sale of securities of
the same issuer is suitable for the investment objectives of two
or more such companies or accounts which have available funds for
investment, the available securities will be allocated in a
manner believed to be equitable to each company or account. It
is recognized that in some cases this procedure may adversely
affect the price paid or received by the Fund or the size of the
position obtainable for or disposed of by the Fund.
In addition, it is understood that the persons employed
by you to assist in the performance of your duties hereunder will
not devote their full time to such service and nothing contained
herein shall be deemed to limit or restrict your right or the
right of any of your affiliates to engage in and devote time and
attention to other businesses or to render services of whatever
kind or nature.
Neither you nor the Index Manager shall be liable for
any error of judgment or mistake of law or for any loss suffered
by the Fund in connection with the matters to which this Agree-
ment relates, except for a loss resulting from willful
misfeasance, bad faith or gross negligence on your part in the
performance of your duties or from reckless disregard by you of
your obligations and duties under this Agreement and, in the case
of the Index Manager, for a loss resulting from willful
misfeasance, bad faith or gross negligence on its part in the
performance of its duties or from reckless disregard by it of its
obligations and duties under its Index Management Agreement. Any
person, even though also your officer, director, partner,
employee or agent, who may be or become an officer, Board member,
employee or agent of the Fund, shall be deemed, when rendering
services to the Fund or acting on any business of the Fund, to be
rendering such services to or acting solely for the Fund and not
as your officer, director, partner, employee or agent or one
under your control or direction even though paid by you.
This Agreement shall continue until May 14, 1997, and
thereafter shall continue automatically for successive annual
periods ending on May 14th of each year, provided such
continuance is specifically approved at least annually by (i) the
Fund's Board or (ii) vote of a majority (as defined in the
Investment Company Act of 1940, as amended) of the Fund's
outstanding voting securities, provided that in either event its
continuance also is approved by a majority of the Fund's Board
members who are not "interested persons" (as defined in said Act)
of any party to this Agreement, by vote cast in person at a
meeting called for the purpose of voting on such approval. This
Agreement is terminable without penalty, on 60 days' notice, by
the Fund's Board or by vote of holders of a majority of the
Fund's shares or, upon not less than 90 days' notice, by you.
This Agreement also will terminate automatically in the event of
its assignment (as defined in said Act).
The Fund recognizes that from time to time your
directors, officers and employees may serve as directors,
trustees, partners, officers and employees of other corporations,
business trusts, partnerships or other entities (including other
investment companies) and that such other entities may include
the name "Dreyfus" as part of their name, and that your
corporation or its affiliates may enter into investment advisory
or other agreements with such other entities. If you cease to
act as the Fund's investment adviser, the Fund agrees that, at
your request, the Fund will take all necessary action to change
the name of the Fund to a name not including "Dreyfus" in any
form or combination of words.
The Fund is agreeing to the provisions of this
Agreement that limit the Index Manager's liability and other
provisions relating to the Index Manager so as to induce the
Index Manager to enter into its Index Management Agreement with
you and to perform its obligations thereunder. The Index Manager
is expressly made a third party beneficiary of this Agreement
with rights as respects the Fund to the same extent as if it had
been a party hereto.
If the foregoing is in accordance with your
understanding, will you kindly so indicate by signing and
returning to us the enclosed copy hereof.
Very truly yours,
PEOPLES S&P MIDCAP INDEX
FUND, INC.
By:___________________________
Accepted:
THE DREYFUS CORPORATION
By:_______________________________
INDEX MANAGEMENT AGREEMENT
THE DREYFUS CORPORATION
200 Park Avenue
New York, New York 10166
November 13, 1995
Mellon Equity Associates
500 Grant Street
Pittsburgh, Pennsylvania 15258
Dear Sirs:
As you are aware, Peoples S&P MidCap Index Fund, Inc.
(d/b/a Dreyfus MidCap Index Fund) (the "Fund") desires to employ
its capital by investing and reinvesting the same in investments
of the type and in accordance with the limitations specified in
its charter documents and in its Prospectus and Statement of
Additional Information as from time to time in effect, copies of
which have been or will be submitted to you, and in such manner
and to such extent as from time to time may be approved by the
Fund's Board. The Fund employs The Dreyfus Corporation
("Dreyfus") pursuant to a written agreement (the "Management
Agreement"), a copy of which has been furnished to you. Dreyfus
desires to employ you to act as the Fund's index manager.
In this connection, it is understood that from time to
time you will employ or associate with yourself such person or
persons as you may believe to be particularly fitted to assist you
in the performance of this Agreement. Such person or persons may
be officers or employees who are employed by both you and the
Fund. The compensation of such person or persons shall be paid by
you and no obligation may be incurred on the Fund's behalf in any
such respect.
Subject to the supervision and approval of Dreyfus, you
will provide investment management of the Fund's portfolio in
accordance with the Fund's investment objective and policies as
stated in the Fund's Prospectus and Statement of Additional
Information as from time to time in effect. In connection
therewith, you will supervise the Fund's investments and, if
appropriate, the sale and reinvestment of the Fund's assets. You
are authorized to invest the Fund's assets in securities issued by
Mellon Bank Corporation, to the extent required or permitted by
the Fund's investment objective and policies, and to the extent
permitted by the U.S. Securities and Exchange Commission or other
applicable authority. You will furnish to Dreyfus or the Fund
such statistical information, with respect to the investments
which the Fund may hold or contemplate purchasing, as Dreyfus or
the Fund may reasonably request. The Fund and Dreyfus wish to be
informed of important developments materially affecting the Fund's
portfolio and shall expect you, on your own initiative, to furnish
to the Fund or Dreyfus from time to time such information as you
may believe appropriate for this purpose.
You shall exercise your best judgment in rendering the
services to be provided hereunder, and Dreyfus agrees as an
inducement to your undertaking the same that you shall not be
liable hereunder for any error of judgment or mistake of law or
for any loss suffered by the Fund or Dreyfus, provided that
nothing herein shall be deemed to protect or purport to protect
you against any liability to Dreyfus, the Fund or the Fund's
security holders to which you would otherwise be subject by reason
of willful misfeasance, bad faith or gross negligence in the
performance of your duties hereunder, or by reason of your
reckless disregard of your obligations and duties hereunder.
In consideration of the services rendered pursuant to
this Agreement, Dreyfus will pay you, on the first business day of
each month, out of the management fee it receives and only to the
extent thereof, a fee calculated daily and paid monthly at the
annual rate of .095 of 1% of the value of the Fund's average daily
net assets, for the preceding month.
Net asset value shall be computed on such days and at
such time or times as described in the Fund's then-current
Prospectus and Statement of Additional Information. The fee for
the period from the date hereof to the end of the month hereof
shall be pro-rated according to the proportion which such period
bears to the full monthly period, and upon any termination of this
Agreement before the end of any month, the fee for such part of a
month shall be pro-rated according to the proportion which such
period bears to the full monthly period and shall be payable
within 10 business days of date of termination of this Agreement.
For the purpose of determining fees payable to you, the
value of the Fund's net assets shall be computed in the manner
specified in the Fund's charter documents for the computation of
the value of the Fund's net assets.
You will bear all expenses in connection with the
performance of your services under this Agreement. You also will
pay, out of your fee to be received hereunder or from other
sources available to you, for the custody services to be provided
to the Fund by Boston Safe Deposit and Trust Company. All other
expenses to be incurred in the operation of the Fund (other than
those borne by Dreyfus) will be borne by the Fund, except to the
extent specifically assumed by you. The expenses to be borne by
the Fund include, without limitation, the following:
organizational costs, 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 you or Dreyfus or any
affiliate of you or Dreyfus, Securities and Exchange Commission
fees and state Blue Sky qualification fees, advisory fees,
transfer and dividend disbursing agents' fees, certain insurance
premiums, industry association fees, outside auditing and legal
expenses, costs of independent pricing services, costs of
maintaining the Fund's existence, costs attributable to investor
services (including, without limitation, telephone and personnel
expenses), costs of preparing and printing prospectuses and
statements of additional information for regulatory purposes and
for distribution to existing stockholders, costs of stockholders'
reports and meetings, and any extraordinary expenses.
If in any fiscal year the aggregate expenses of the Fund
(including fees pursuant to the Fund's Management Agreement, but
excluding interest, taxes, brokerage and, with the prior written
consent of the necessary state securities commissions,
extraordinary expenses) exceed the expense limitation of any state
having jurisdiction over the Fund, Dreyfus may deduct from the
fees to be paid hereunder, or you will bear such excess expense on
a pro-rata basis with Dreyfus, in the proportion ("Your
Proportion") that the index management fee payable to you pursuant
to this Agreement bears to the fee payable to Dreyfus pursuant to
the Management Agreement, to the extent required by state law. If
Dreyfus fails to receive any portion of its fees under the
Management Agreement, for any reason other than Dreyfus' voluntary
waiver of such fees, your fee under this Agreement shall be
reduced by Your Proportion of the amount which Dreyfus shall not
have received. If Dreyfus waives receipt of any portion of its
fees under the Management Agreement, your fee under this Agreement
shall be reduced by Your Proportion of the amount which Dreyfus
shall have waived, provided that in no event will any such waiver
reduce the fee to be paid to you hereunder below the annual rate
of .055 of 1% of the value of the Fund's average daily net assets
during the period of such waiver. Dreyfus agrees to notify you in
advance of any such waiver. Your obligations pursuant to this
paragraph will be limited to the amount of your fees hereunder.
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.
Dreyfus understands that you now act, and that from time
to time hereafter you may act, as investment adviser to one or
more other investment companies and fiduciary or other managed
accounts, and Dreyfus has no objection to your so acting, provided
that when purchase or sale of securities of the same issuer is
suitable for the investment objectives of two or more companies or
accounts managed by you which have available funds for investment,
the available securities will be allocated in a manner believed by
you to be equitable to each company or account. It is recognized
that in some cases this procedure may adversely affect the price
paid or received by the Fund or the size of the position
obtainable for or disposed of by the Fund.
In addition, it is understood that the persons employed
by you to assist in the performance of your duties hereunder will
not devote their full time to such services and nothing contained
herein shall be deemed to limit or restrict your right or the
right of any of your affiliates to engage in and devote time and
attention to other businesses or to render services of whatever
kind or nature.
You shall not be liable for any error of judgment or
mistake of law or for any loss suffered by the Fund or Dreyfus in
connection with the matters to which this Agreement relates,
except for a loss resulting from willful misfeasance, bad faith or
gross negligence on your part in the performance of your duties or
from reckless disregard by you of your obligations and duties
under this Agreement. Any person, even though also your officer,
director, partner, employee or agent, who may be or become an
officer, Board member, employee or agent of the Fund, shall be
deemed, when rendering services to the Fund or acting on any
business of the Fund, to be rendering such services to or acting
solely for the Fund and not as your officer, director, partner,
employee, or agent or one under your control or direction even
though paid by you.
This Agreement shall continue until May 14, 1997, and
thereafter shall continue automatically for successive annual
periods ending on May 14th of each year, provided such continuance
is specifically approved at least annually by (i) the Fund's Board
or (ii) vote of a majority (as defined in the Investment Company
Act of 1940, as amended) of the Fund's outstanding voting
securities, provided that in either event its continuance also is
approved by a majority of the Fund's Board members who are not
"interested persons" (as defined in said Act) of any party to this
Agreement, by vote cast in person at a meeting called for the
purpose of voting on such approval. This Agreement is terminable
without penalty (i) by Dreyfus upon 60 days' notice to you, (ii)
by the Fund's Board or by vote of the holders of a majority of the
Fund's shares upon 60 days' notice to you, or (iii) by you upon
not less than 90 days' notice to the Fund and Dreyfus. This
Agreement also will terminate automatically in the event of its
assignment (as defined in said Act). In addition, notwithstanding
anything herein to the contrary, if the Management Agreement
terminates for any reason, this Agreement shall terminate
effective upon the date the Management Agreement terminates.
If the foregoing is in accordance with your
understanding, will you kindly so indicate by signing and
returning to us the enclosed copy hereof.
Very truly yours,
THE DREYFUS CORPORATION
By:_________________________
Accepted:
MELLON EQUITY ASSOCIATES
By:__________________________
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 December 7, 1995, in this Registration Statement
(Form N-1A No. 33-41078) of Dreyfus MidCap Index Fund (formerly People's
S&P Midcap Index Fund, Inc.).
ERNST & YOUNG LLP
New York, New York
December 26, 1995
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<NAME> PEOPLES S&P MIDCAP INDEX FUND, INC.
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