-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, P35fKaMP4xp7+Ln25Ydu16WknqSEKCrDQsVdt4W4yxAGvU/4hWU1ESYjeq2sLYba JCLt3geCiJ0CworWc9FxGg== 0000030167-96-000010.txt : 19960801 0000030167-96-000010.hdr.sgml : 19960801 ACCESSION NUMBER: 0000030167-96-000010 CONFORMED SUBMISSION TYPE: 485APOS PUBLIC DOCUMENT COUNT: 5 FILED AS OF DATE: 19960731 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: DREYFUS THIRD CENTURY FUND INC CENTRAL INDEX KEY: 0000030167 STANDARD INDUSTRIAL CLASSIFICATION: UNKNOWN SIC - 0000 [0000] IRS NUMBER: 132691318 STATE OF INCORPORATION: MD FISCAL YEAR END: 0531 FILING VALUES: FORM TYPE: 485APOS SEC ACT: 1933 Act SEC FILE NUMBER: 002-40341 FILM NUMBER: 96601929 FILING VALUES: FORM TYPE: 485APOS SEC ACT: 1940 Act SEC FILE NUMBER: 811-02192 FILM NUMBER: 96601930 BUSINESS ADDRESS: STREET 1: 144 GLENN CURTISS BLVD CITY: UNIONDALE STATE: NY ZIP: 11556-0144 BUSINESS PHONE: 2129226792 MAIL ADDRESS: STREET 1: C/O DREYFUS CORP STREET 2: 200 PARK AVENUE, 8TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10166 485APOS 1 POST-EFFECTIVE AMENDMENT NO. 42 File Nos. 2-40341 811-2192 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM N-1A REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ ] Pre-Effective Amendment No. [ ] Post-Effective Amendment No. 42 [X] and/or REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X] Amendment No. 42 [X] (Check appropriate box or boxes.) THE DREYFUS THIRD CENTURY FUND, INC. (Exact Name of Registrant as Specified in Charter) c/o The Dreyfus Corporation 200 Park Avenue, New York, New York 10166 (Address of Principal Executive Offices) (Zip Code) Registrant's Telephone Number, including Area Code: (212) 922-6000 Mark N. Jacobs, Esq. 200 Park Avenue New York, New York 10166 (Name and Address of Agent for Service) It is proposed that this filing will become effective (check appropriate box) immediately upon filing pursuant to paragraph (b) of Rule 485 ---- on (date) pursuant to paragraph (b) of Rule 485 ---- 60 days after filing pursuant to paragraph (a) of Rule 485 ---- X on October 1, 1996 pursuant to paragraph (a) of Rule 485 ---- 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 May 31, 1996 was filed on July 23, 1996. THE DREYFUS THIRD CENTURY 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, 18 5 Management of the Fund 7 5(a) Management's Discussion of Fund's Performance * 6 Capital Stock and Other Securities 18 7 Purchase of Securities Being Offered 9 8 Redemption or Repurchase 14 9 Pending Legal Proceedings * Items in Part B of Form N-1A - --------- 10 Cover Page Cover 11 Table of Contents Cover 12 General Information and History B-22 13 Investment Objectives and Policies B-2 14 Management of the Fund B-6 15 Control Persons and Principal B-8 Holders of Securities 16 Investment Advisory and Other B-9 Services _____________________________________ NOTE: * Omitted since answer is negative or inapplicable. THE DREYFUS THIRD CENTURY 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-21 18 Capital Stock and Other Securities B-22 19 Purchase, Redemption and Pricing B-12, B-13 of Securities Being Offered 20 Tax Status * 21 Underwriters B-12 22 Calculation of Performance Data * 23 Financial Statements B-24 Items in Part C of Form N-1A _________ 24 Financial Statements and Exhibits C-1 25 Persons Controlled by or Under C-3 Common Control with Registrant 26 Number of Holders of Securities C-3 27 Indemnification C-3 28 Business and Other Connections of C-4 Investment Adviser 29 Principal Underwriters C-14 20 Location of Accounts and Records C-17 31 Management Services C-17 32 Undertakings C-17 _____________________________________ NOTE: * Omitted since answer is negative or inapplicable. - ------------------------------------------------------------------------------ PROSPECTUS OCTOBER 1, 1996 THE DREYFUS THIRD CENTURY FUND, INC. - ------------------------------------------------------------------------------ THE DREYFUS THIRD CENTURY FUND, INC. (THE "FUND") -- CREATED TO MARK THE ENTRY OF THE UNITED STATES INTO THE THIRD CENTURY OF ITS POLITICAL EXISTENCE -- IS AN OPEN-END, DIVERSIFIED, MANAGEMENT INVESTMENT COMPANY, KNOWN AS A MUTUAL FUND. THE FUND'S PRIMARY GOAL IS TO PROVIDE CAPITAL GROWTH. CURRENT INCOME IS A SECONDARY GOAL. THE FUND INVESTS PRINCIPALLY IN COMMON STOCKS, OR SECURITIES CONVERTIBLE INTO COMMON STOCK, OF COMPANIES WHICH, IN THE OPINION OF THE FUND'S MANAGEMENT, NOT ONLY MEET TRADITIONAL INVESTMENT STANDARDS, BUT ALSO SHOW EVIDENCE THAT THEY CONDUCT THEIR BUSINESS IN A MANNER THAT CONTRIBUTES TO THE ENHANCEMENT OF THE QUALITY OF LIFE IN AMERICA. YOU CAN INVEST, REINVEST OR REDEEM SHARES AT ANY TIME WITHOUT CHARGE OR PENALTY. YOU CAN PURCHASE OR REDEEM SHARES BY TELEPHONE USING DREYFUS TELE- TRANSFER. THE DREYFUS CORPORATION ("DREYFUS") SERVES AS THE FUND'S INVESTMENT ADVISER. NCM CAPITAL MANAGEMENT GROUP, INC. ("NCM") SERVES AS THE FUND'S SUB-INVESTMENT ADVISER AND PROVIDES DAY-TO-DAY MANAGEMENT OF THE FUND'S PORTFOLIO. THIS PROSPECTUS SETS FORTH CONCISELY INFORMATION ABOUT THE FUND THAT YOU SHOULD KNOW BEFORE INVESTING. IT SHOULD BE READ AND RETAINED FOR FUTURE REFERENCE. THE STATEMENT OF ADDITIONAL INFORMATION, DATED OCTOBER 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. THE SECURITIES AND EXCHANGE COMMISSION MAINTAINS A WEB SITE (HTTP://WWW.SEC.GOV) THAT CONTAINS THE STATEMENT OF ADDITIONAL INFORMATION, MATERIAL INCORPORATED BY REFERENCE, AND OTHER INFORMATION REGARDING THE FUND. FOR A FREE COPY OF THE STATEMENT OF ADDITIONAL INFORMATION, 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 SHAREHOLDER SERVICES................. 11 HOW TO REDEEM SHARES................. 14 SHAREHOLDER SERVICES PLAN............ 16 DIVIDENDS, DISTRIBUTIONS AND TAXES .. 16 PERFORMANCE INFORMATION.............. 18 GENERAL INFORMATION.................. 18 PAGE ANNUAL FUND OPERATING EXPENSES ..... 3 CONDENSED FINANCIAL INFORMATION..... 3 DESCRIPTION OF THE FUND............. 4 MANAGEMENT OF THE FUND.............. 7 HOW TO BUY SHARES................... 9 - ------------------------------------------------------------------------------ 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. - ------------------------------------------------------------------------------ (This Page Intentionally Left Blank) Page 2
ANNUAL FUND OPERATING EXPENSES (as a percentage of average daily net assets) Management Fees............................................................................. .75% Other Expenses ............................................................................. .36% Total Fund Operating Expenses............................................................... 1.11%
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: $11 $35 $61 $135
- ------------------------------------------------------------------------------ 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 various costs and expenses borne by the Fund and therefore indirectly by investors, the payment of which will reduce investors' annual return. The foregoing table does not reflect any fee waivers or expense reimbursement arrangements that may be in effect. See "Management of the Fund" 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. 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 May 31, ----------------------------------------------------------------------------------------- 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 ------ ------ ------ ------ ------ ----- ------ ------ ------ ------ PER SHARE DATA: Net asset value, beginning of year $8.13 $7.73 $5.76 $6.33 $7.01 $7.79 $7.80 $8.48 $7.80 $7.45 ------ ------ ------ ------ ------ ----- ------ ------ ------ ------ INVESTMENT OPERATIONS: Investment income-net.... .23 .19 .29 .21 .06 .05 .04 .05 .07 .03 Net realized and unrealized gain (loss) on investments........... .64 (.53) .84 .84 1.07 .26 .74 (.08) .65 2.39 ------ ------ ------ ------ ------ ----- ------ ------ ------ ------ TOTAL FROM INVESTMENT OPERATIONS .87 (.34) 1.13 1.05 1.13 .31 .78 (.03) .72 2.42 ------ ------ ------ ------ ------ ----- ------ ------ ------ ------ DISTRIBUTIONS: Dividends from investment income-net (.31) (.36) (.30) (.18) (.12) (.08) (.05) (.04) (.07) (.05) Dividends from net realized gain on investments.............. (.96) (1.27) (.26) (.19) (.23) (.22) (.05) (.61) (1.00) (.57) ------ ------ ------ ------ ------ ----- ------ ------ ------ ------ TOTAL DISTRIBUTIONS...... (1.27) (1.63) (.56) (.37) (.35) (.30) (.10) (.65) (1.07) (.62) ------ ------ ------ ------ ------ ----- ------ ------ ------ ------ Net asset value, end of year $7.73 $5.76 $6.33 $7.01 $7.79 $7.80 $8.48 $7.80 $7.45 $9.25 ====== ====== ====== ====== ====== ===== ====== ====== ====== ====== TOTAL INVESTMENT RETURN 14.53% (3.92%) 20.54% 17.26% 17.19% 3.92% 10.02% (.63%) 11.81% 33.63% RATIOS / SUPPLE MENTAL DATA: Ratio of expenses to average net assets .99% 1.02% 1.04% 1.05% 1.04% 1.08% 1.11% 1.17% 1.12% 1.11% Ratio of net investment income to average net assets............... 2.95% 2.94% 4.71% 3.19% 1.10% .83% .48% .52% .93% .36% Portfolio Turnover Rate.. 32.66% 36.76% 52.82% 162.82% 72.57% 47.92% 67.30% 71.70% 133.54% 92.08% Net Assets, end of year (000's Omitted)$169,944 $152,533 $168,579 $195,658 $266,126 $443,533 $526,335 $390,340 $368,833 $473,452
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 OBJECTIVES -- The Fund's primary goal is to provide capital growth through equity investment in companies that, in the opinion of the Fund's management, not only meet traditional investment standards but which also show evidence that they conduct their business in a manner that contributes to the enhancement of the quality of life in America. Current income is secondary to the primary goal. There can be no assurances that the Fund's investment objectives will be achieved. SPECIAL CONSIDERATIONS -- TYPES OF COMPANIES SOUGHT FOR INVESTMENT _ To assess whether a company contributes to the enhancement of the quality of life in America, the Fund considers a company's record in the areas of (1) protection and improvement of the environment and the proper use of our natural resources, (2) occupational health and safety, (3) consumer protection and product safety, and (4) equal employment opportunity. Consistent with its consumer protection screen, the Fund will not purchase shares in a company which manufactures tobacco products. There are few generally accepted measures of achievement in these areas. The development of suitable measurement techniques, therefore, will be largely within the discretion and judgment of the management of the Fund. Management does not intend at present to evaluate in depth a company's activities not directly connected with the conduct of its business (such as participation in community improvement projects) or the secondary implications of corporate activities (for example, in examining banks, the business activities of their borrowers will not be evaluated). The Fund's special considerations tend to limit the availability of investment opportunities more than is customary with other investment companies, including those managed by Dreyfus. Management believes, however, that there are sufficient investment opportunities among companies which meet the Fund's special considerations to permit full investment, if management believes it desirable, in securities which meet the Fund's investment objective of capital growth through equity investment. The Fund's objectives and special considerations described above cannot be changed without approval by the holders of a majority, as defined in the Investment Company Act of 1940, as amended (the "Act"), of the Fund's outstanding voting shares. The Fund's Board of Directors may adopt additional criteria or restrictions governing the Fund's investments if the Board of Directors determines that the new criteria or restrictions are consistent with the Fund's objective of investing in a socially responsible manner, but the Board may not change the four existing special considerations described above without shareholder approval. THE INVESTMENT SELECTION PROCESS _ Potential investment portfolio selections (based on traditional investment considerations, including an opinion of the fundamental value of the security and other market factors) are designated to the Dreyfus research staff. The staff begins a process of searching publicly available information about the company to determine its record in the areas of special concern to the Fund. Researchers use commercially available computer data bases and reviews and evaluations published or made available by "watchdog" groups whose interests focus on one or more of the special areas, such as the environment, equal employment opportunity, product safety or occupational safety and health, as applicable. Additional data may be obtained, where practical, from local, state and federal agencies which maintain surveillance in certain areas of interest to the Fund and which provide this data to the public. If the initial evaluation reveals no negative pattern in the areas of special concern to the Fund, a company's securities are eligible for purchase. The research staff supplements this initial screening by asking the company to complete a questionnaire designed by the Fund to aid in the evaluation of the company's Page 4 conduct in the areas of special concern. The examination of a company may also include personal interviews with company officials, inspection of facilities and other techniques that may be applicable to specific companies or industries. If it is determined at any stage that purchase or retention of the portfolio security is not consistent with the Fund's goal of investing in companies whose conduct contributes to the enhancement of the quality of life in America, the security will not be purchased or, if already purchased, will be sold as expeditiously as possible, consistent with the best interests of the Fund. The Board will review new portfolio acquisitions in light of the Fund's special concerns at their next regular meeting. While the Board of Directors will disqualify a company evidencing a pattern of conduct that is inconsistent with the Fund's special standards, the Board need not disqualify a company on the basis of incidents that, in the Board's judgment, do not reflect the company's policies and overall current level of performance in the areas of special concern to the Fund. The performance of companies in the areas of special concern are reviewed regularly to determine their continued eligibility. MANAGEMENT POLICIES _ Depending on market conditions, the Fund attempts to be fully invested in common stock, or securities convertible into common stock, which meet both traditional investment standards and the Fund's investment criteria described under "Types of Companies Sought for Investment." As a fundamental policy, the Fund is permitted to borrow to the extent permitted under the Act. However, the Fund currently intends to borrow money only for temporary or emergency (not leveraging) purposes, in an amount up to 15% of the value of the Fund's 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. The Fund may invest up to 15% of the value of its net assets in securities which are illiquid securities, provided such investments are consistent with the Fund's investment objective. Illiquid securities are securities which are not readily marketable, such as certain securities that are subject to legal or contractual restrictions on resale, repurchase agreements providing for settlement in more than seven days after notice, and certain options traded in the over-the-counter market and securities used to cover such options. Investment in illiquid securities subjects the Fund to the risk that it will not be able to sell such securities when it may be opportune to do so. During periods in which management believes adverse trends are occurring in the financial markets or the economy, the Fund may adopt a temporary defensive posture to preserve shareholders' capital by investing in U.S. Government securities, and also in corporate bonds, high grade commercial paper, repurchase agreements, time deposits, bank certificates of deposit, bankers' acceptances and other short-term bank obligations issued in this country as well as those issued in dollar denominations by the foreign branches of U.S. banks, and cash or cash equivalents, without limit as to amount, as long as such investments are made in securities of eligible companies and domestic banks. When the Fund has adopted a temporary defensive posture, the entire portfolio can be so invested. During such periods, the Fund may not achieve its investment objectives. Repurchase agreements involve the acquisition by the Fund of an underlying debt instrument subject to an obligation of the seller to repurchase, and the Fund to resell, the instrument at a fixed price, usually not more than one week after its purchase. The Fund's custodian will have custody of, and will hold in a segregated account, securities acquired by the Fund under a repurchase agreement. Repurchase agreements are considered by the staff of the Securities and Exchange Commission to be loans by the Fund. In an attempt to reduce the risk of incurring a loss on a repurchase agreement, the Fund will enter into repurchase agreements only with domestic banks with total assets in excess of one billion dollars or primary government securities dealers reporting to the Federal Reserve Bank of New Page 5 York with respect to securities of the type in which the Fund may invest, and the Fund will require that additional securities be deposited with its custodian if the value of the securities purchased should decrease below resale price. Dreyfus will monitor on an ongoing basis the value of the collateral to assure that it always equals or exceeds the repurchase price. Certain costs may be incurred by the Fund in connection with the sale of the securities if the seller does not repurchase them in accordance with the repurchase agreement. In addition, if bankruptcy proceedings are commenced with respect to the seller of the securities, realization on the securities by the Fund may be delayed or limited. The Fund will consider on an ongoing basis the creditworthiness of the institutions with which it enters into repurchase agreements. 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. Time deposits which may be held by the Fund will not benefit from insurance from the Bank Insurance Fund or the Savings Association Insurance Fund administered by the Federal Deposit Insurance Corporation. Bankers' acceptances are credit instruments evidencing the obligation of a bank to pay a draft drawn on it by a customer. These instruments reflect the obligation both of the bank and of the drawer to pay the full amount of the instrument upon maturity. The other short-term obligations may include uninsured, direct obligations bearing fixed, floating or variable interest rates. To earn additional income on its portfolio, the Fund may write and sell covered call option contracts on securities it owns to the extent of 20% of the value of its net assets at the time such option contracts are written. A call option gives the purchaser of the option the right to buy, and obligates the writer to sell, the underlying security at the exercise price at any time during the option period. A covered call option sold by the Fund, which is a call option on a security owned by the Fund, exposes the Fund during the term of the option to possible loss of opportunity to realize appreciation in the market price of the underlying security or to possible continued holding of a security which might otherwise have been sold to protect against depreciation in the market price of the security. A more detailed description of the securities in which the Fund may invest can be found in the Statement of Additional Information. The Fund may invest in companies with substantial overseas activities, but, at present, management will not examine corporate activities carried on outside the United States. CERTAIN FUNDAMENTAL POLICIES -- The Fund may (i) borrow money to the extent permitted under the Act, which currently limits borrowing to no more than 331/ 3% of the value of the Fund's total assets; (ii) invest up to 5% of the value of its total net assets in the securities of any one issuer (except securities of the U.S. Government or any instrumentality thereof); (iii) invest in companies having less than three years continuous operating history (including that of predecessors) but only in an amount up to 5% of the value of its net assets; and (iv) invest up to 25% of the value of its total assets in any single industry. This paragraph describes fundamental policies of the Fund which cannot be changed without approval by the holders of a majority (as defined in the Act) of the Fund's outstanding voting shares. See "Investment Objectives and Management Policies_Investment Restrictions" in the Fund's Statement of Additional Information. Page 6 CERTAIN ADDITIONAL NON-FUNDAMENTAL POLICIES -- The Fund may (i) pledge, hypothecate, mortgage or otherwise encumber its assets, but only to secure permitted borrowings; and (ii) invest up to 15% of the value of its net assets in repurchase agreements providing for settlement in more than seven days after notice and in other illiquid securities. See "Investment Objectives and Management Policies _ Investment Restrictions" in the Fund's Statement of Additional Information. INVESTMENT CONSIDERATIONS _ The Fund will not seek to realize profits by anticipating short-term market movements. When market conditions permit, the Fund generally intends to retain securities for at least the statutory long-term capital gain period. The annual portfolio turnover rate indicates the rate of change in the Fund's portfolio; for instance, a rate of 100% would result if all the securities in the portfolio at the beginning of an annual period had been replaced by the end of the period. While the rate of portfolio turnover will not be a limiting factor when management deems changes appropriate, it is anticipated that, in view of the Fund's investment objectives, its annual portfolio turnover rate generally should not exceed 75%. When extraordinary market conditions prevail, a higher turnover rate and increased brokerage expenses may be expected. Investment decisions for the Fund are made independently from those of other investment companies advised by Dreyfus. However, if such other investment companies are prepared to invest in, or desire to dispose of, securities of the type which the Fund invests in at the same time as the Fund, available investments or opportunities for sales will be allocated equitably to each investment company. In some cases, this procedure may adversely affect the size of the position obtained for or disposed of by the Fund or the price paid or received by the Fund. MANAGEMENT OF THE FUND INVESTMENT ADVISER _ Dreyfus, located at 200 Park Avenue, New York, New York 10166, was formed in 1947 and serves as the Fund's investment adviser. Dreyfus is a wholly-owned subsidiary of Mellon Bank, N.A., which is a wholly-owned subsidiary of Mellon Bank Corporation ("Mellon"). As of June 28, 1996, Dreyfus managed or administered approximately $79 billion in assets for more than 1.7 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 overall authority of the Fund's Board of Directors 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, Mellon managed approximately $___ billion in assets as of _____________, including $__ billion in mutual fund assets. As of ___________, Mellon, through various subsidiaries, provided non-investment services, such as custodial or administration services, for approximately $707 billion in assets including approximately $__ billion in mutual fund assets. Under the terms of the Management Agreement, the Fund has agreed to pay Dreyfus a fee, payable monthly, at the annual rate of .75 of 1% of the value of the Fund's average daily net assets. For the fiscal year ended May 31, 1996, the Fund paid Dreyfus a management fee at the annual rate of .75 of 1% of the value of the Fund's average daily net assets. In allocating brokerage transactions for the Fund, Dreyfus seeks to obtain the best execution of orders at the most favorable net price. Subject to this determination, Dreyfus may consider, among other things, the receipt of research services and/or the sale of shares of the Fund or other funds in the Dreyfus Family of Funds as factors in the selection of broker-dealers to execute portfolio transactions for the Fund. See "Portfolio Transactions" in the Statement of Additional Information. SUB-INVESTMENT ADVISER -- NCM, located at 103 West Main Street, Durham, North Carolina 27705-3638, a registered investment adviser, serves as the Fund's sub-investment adviser. NCM was Page 7 incorporated in 1986 and is one of the nation's largest minority-owned investment management firms. Prior to August 2, 1994, NCM had not advised a registered investment company. As of June 30, 1996, NCM served as the sub-investment adviser for one other registered investment company. As of June 30, 1996, NCM managed or administered approximately $3.6 billion in assets. NCM, subject to the supervision and approval of Dreyfus, provides investment advisory assistance and the day-to-day management of the Fund's portfolio, as well as research and statistical information under an Amended and Restated Sub-Investment Advisory Agreement with Dreyfus dated April 22, 1996, subject to the overall authority of the Fund's Board of Directors in accordance with Maryland law. Prior to April 22, 1996, NCM provided such services pursuant to a Sub-Investment Advisory Agreement with Dreyfus dated August 2, 1994 (the "Prior Sub-Advisory Agreement"). The Amended and Restated Sub-Investment Advisory Agreement provides for an increase in the fees payable by Dreyfus to NCM and contains a restriction on NCM's ability to act as the investment adviser or sub-investment adviser for other registered funds with socially responsible investment policies without the consent of Dreyfus or the Fund. Under the Amended and Restated Sub-Investment Advisory Agreement, Dreyfus has agreed to pay NCM an annual fee, payable monthly, as set forth below:
ANNUAL FEE AS A PERCENTAGE OF TOTAL ASSETS AVERAGE DAILY NET ASSETS 0 to $400 million............................................... .10 of 1% In excess of $400 million to $500 million.............................................. .15 of 1% In excess of $500 million to $750 million............................................. .20 of 1% In excess of $750 million....................................... .25 of 1%
For the fiscal year ended May 31, 1996, Dreyfus paid NCM pursuant to the Amended and Restated Sub-Investment Advisory Agreement and Prior Sub-Advisory Agreement a monthly fee at the effective aggregate annual rate of .10 of 1% of the value of the Fund's average daily net assets. The Fund's portfolio managers primarily responsible for management of the Fund's portfolio are Eric W. Steedman, with respect to the Fund's areas of special concern, and Maceo K. Sloan, with respect to selection of portfolio securities. Mr. Steedman has held that position since May 1, 1996 and has been employed by Dreyfus since January 1995. From June 1994 to December 1994, he was employed by the Council on Economic Priorities. Mr. Sloan has held his position with the Fund since August 1994 and has been employed by NCM since 1986. The Fund's other portfolio managers are identified under"Management of the Fund" in the Fund's Statement of Additional Information. Dreyfus also provides research services for the Fund as well as for other funds advised by Dreyfus through a professional staff of portfolio managers and security analysts. EXPENSES -- From time to time, Dreyfus may waive receipt of its fees and/or voluntarily assume certain expenses of the Fund, which would have the effect of lowering the overall expense ratio of the Fund and increasing yield to investors at the time such amounts are waived or assumed, as the case may be. The Fund will not pay Dreyfus at a later time for any amounts it may waive, nor will the Fund reimburse Dreyfus for any amounts it may assume. Dreyfus may pay the Fund's distributor for shareholder services from Dreyfus' 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. DISTRIBUTOR -- The Fund's distributor is Premier Mutual Fund Services, Inc. (the "Distributor"), located at 60 State Street, Boston, Massachusetts 02109. The Distributor is a wholly-owned sub- Page 8 sidiary 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. CUSTODIAN AND TRANSFER AND DIVIDEND DISBURSING AGENT _ Dreyfus Transfer, Inc., a wholly-owned subsidiary of Dreyfus, P.O. Box 9671, Providence, Rhode Island 02940-9671, is the Fund's Transfer and Dividend Disbursing Agent (the "Transfer Agent"). Mellon Bank, N.A., One Mellon Bank Center, Pittsburgh, P.A. 15258, is the Custodian of the Fund's investments. HOW TO BUY SHARES Fund shares are sold without a sales charge if you purchase them directly from the Distributor; you may be charged a nominal fee if you effect transactions in shares of the Fund 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, investment adviser or bank which has made an aggregate minimum initial purchase for its customers of $2,500, or $750 if the investment is for Dreyfus sponsored Keogh Plans, IRAs, SEP-IRAs and 403(b)(7) Plans with only one participant. Subsequent investments normally must be at least $100, although there is no minimum for retirement plans. The initial investment must be accompanied by the Fund's Account Application. The Fund reserves the right to offer Fund shares without regard to minimum purchase requirements to employees participating in certain qualified or non-qualified employee benefit plans or other programs where contributions or account information can be transmitted in a manner and in a form acceptable to the Fund. 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, including members of the Fund's Board, or the spouse or minor child of any of the foregoing, the minimum initial investment is $1,000. For full-time or part-time employees of 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. Fund shares also are offered without regard to the minimum initial investment requirements through Dreyfus-AUTOMATIC Asset BuilderRegistration Mark, Dreyfus Government Direct Deposit Privilege or Dreyfus Payroll Savings Plan pursuant to the Dreyfus Step Program described under "Shareholder Services." These services enable you to make regularly scheduled investments and may provide you with a convenient way to invest for long-term financial goals. You should be aware, however, that periodic investment plans do not guarantee a profit and will not protect an investor against loss in a declining market. The Fund reserves the right to vary further the initial and subsequent investment minimum requirement at any time. You may purchase Fund shares by check or wire, or through the Dreyfus TELETRANSFER Privilege described below. Checks should be made payable to "The Dreyfus Family of Funds," or, if for Dreyfus retirement plan accounts, to "The Dreyfus Trust Company, Custodian." Payments to open new accounts which are mailed should be sent to The Dreyfus Family of Funds, P.O. Box 9387, Providence, Rhode Island 02940-9387, together with your Account Application. For subsequent investments, your Fund account number should appear on the check and an investment slip should be enclosed and sent to The Dreyfus Family of Funds, P.O. Box 105, Newark, New Jersey 07101-0105. 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 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." Page 9 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 #8900051787/The Dreyfus Third Century Fund, Inc. for purchase of Fund shares in your name. The wire must include your Fund account number (for new accounts, your Taxpayer Identification Number ("TIN") should be included instead), account registra- tion 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 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 may also 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." 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 business day, Fund shares will be purchased at the net asset value determined as of the close of trading on that day. Otherwise, Fund shares will be purchased at the next determined net asset value. 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 U.S.-based 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 one million dollars. All present holdings of shares of funds in the Dreyfus Family of Funds by such employee benefit plans or programs will be aggregated to determine the fee payable with respect to each such purchase of Fund shares. 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. Net asset value per share is determined as of the close of trading on the floor of the New York Stock Exchange (currently 4:00 p.m., New York time), on each day that the New York Stock Exchange is open for business. For purposes of determining net asset value per share, options 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 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 Board of Directors. For further information regarding the method employed in valuing Fund investments, see "Determination of Net Asset Value" in the Fund's 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 Page 10 information concerning this requirement. Failure to furnish a certified TIN to the Fund could subject you to a $50 penalty imposed by the Internal Revenue Service (the "IRS"). DREYFUS TELETRANSFER PRIVILEGE _ You may purchase Fund shares (minimum of $500, maximum of $150,000 per day) by telephone if you have checked the appropriate box and supplied the necessary information on the Fund's Account Application or have filed a Shareholder Services Form with the Transfer Agent. The proceeds will be transferred between the bank account designated in one of these documents and your Fund account. Only a bank account maintained in a domestic financial institution which is an Automated Clearing House member may be so designated. The Fund may modify or terminate this Privilege at any time or charge a service fee upon notice to shareholders. No such fee currently is contemplated. If you have selected the Dreyfus TELETRANSFER Privilege, you may request a Dreyfus TELETRANSFER purchase by telephoning 1-800-645-6561 or, if you are calling from overseas, call 516-794-5452. SHAREHOLDER SERVICES FUND EXCHANGES -- You may purchase, in exchange for shares of the Fund, shares of certain other funds managed or administered by Dreyfus, to the extent such shares are offered for sale in your state of residence. These funds have different investment objectives which may be of interest to you. If you desire to use this service, please call 1-800-645-6561 to determine if it is available and whether any conditions are imposed on its use. To request an exchange, you must give exchange instructions to the Transfer Agent in writing or by telephone. Before any exchange, you must obtain and should review a copy of the current prospectus of the fund into which the exchange is being made. Prospectuses may be obtained by calling 1-800-645-6561. Except in the case of Personal Retirement Plans, the shares being exchanged must have a current value of at least $500; furthermore, when establishing a new account by exchange, the shares being exchanged must have a current value of at least the minimum initial investment required for the fund into which the exchange is being made. The ability to issue exchange instructions by telephone is given to all Fund shareholders automatically, unless you check the applicable "No" box on the Account Application, indicating that you specifically refuse this Privilege. The Telephone Exchange Privilege may be established for an existing account by written request, signed by all shareholders on the account, by a separate signed Shareholder Services Form, available by calling 1-800-645-6561 or, by oral request from any of the authorized signatories on the account, also by calling 1-800-645-6561. If you have established the Telephone Exchange Privilege, you may telephone exchange instructions by calling 1-800-645-6561 or, if you are calling from overseas, call 516-794-5452. See "How to Redeem Fund Shares_Procedures." Upon an exchange into a new account, the following shareholder services and privileges, as applicable and where available, will be automatically carried over to the fund into which the exchange is made: Telephone Exchange Privilege, Wire Redemption Privilege, Telephone Redemption Privilege, TELETRANSFER Privilege, and the dividend/capital gain distribution option (except for Dividend Sweep) selected by the investor. Shares will be exchanged at the next determined net asset value; however, a sales load may be charged with respect to exchanges into funds sold with a sales load. If you are exchanging into a fund that charges a sales load, you may qualify for share prices which do not include the sales load or which reflect a reduced sales load, if the shares from which you are exchanging or transferring were: (a) purchased with a sales load, (b) acquired by a previous exchange or transfer from shares purchased with a sales load, or (c) acquired through reinvestment of dividends or distributions paid with respect to the foregoing categories of shares. To qualify, at the time of your exchange or transfer you must notify the Transfer Agent. Any such qualification is subject to confirmation of your holdings through a check of appropriate records. See "Shareholder Services" in the Statement of Additional Information. No fees currently are charged shareholders directly in connection with exchanges, although the Fund reserves the right, upon not less than 60 Page 11 days' notice, to charge shareholders a nominal fee in accordance with rules promulgated by the Securities and Exchange Commission. The Fund reserves the right to reject any exchange request in whole or in part. The availability of Fund Exchanges may be modified or terminated upon notice to shareholders. The exchange of shares of one fund for shares of another is treated for Federal income tax purposes as a sale of the shares given in exchange by the shareholder, and an exchanging shareholder, therefore, may realize a taxable gain or loss. DREYFUS AUTO-EXCHANGE PRIVILEGE -- Dreyfus Auto-Exchange Privilege enables you to invest regularly (on a semi-monthly, monthly, quarterly or annual basis), in exchange for shares of the Fund, in shares of other funds in The Dreyfus Family of Funds of which you are currently an investor. The amount you designate, which can be expressed either in terms of a specific dollar or share amount ($100 minimum), will be exchanged automatically on the first and/or fifteenth day of the month according to the schedule you have selected. Shares will be exchanged at the then-current net asset value; however, a sales load may be charged with respect to exchanges into funds sold with a sales load. See "Shareholder Services" in the Statement of Additional Information. The right to exercise this Privilege may be modified or cancelled by the Fund or the Transfer Agent. You may modify or cancel your exercise of this Privilege at any time by writing to The Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. The Fund may charge a service fee for the use of this Privilege. No such fee currently is contemplated. The exchange of shares of one fund for shares of another is treated for Federal income tax purposes as a sale of the shares given in exchange by the shareholder and, therefore, an exchanging shareholder may realize a taxable gain or loss. For more information concerning this Privilege and the funds in the Dreyfus Family of Funds eligible to participate in this Privilege, or to obtain a Dreyfus Auto-Exchange Authorization Form, please call toll free 1-800-645-6561. DREYFUS-AUTOMATIC ASSET BUILDERRegistration Mark -- Dreyfus-AUTOMATIC Asset Builder permits you to purchase Fund shares (minimum of $100 and maximum of $150,000 per transaction) at regular intervals selected by you. Fund shares are purchased by transferring funds from the bank account designated by you. At your option, the bank account designated by you will be debited in the specified amount, and Fund shares will be purchased, once a month, on either the first or fifteenth day, or twice a month, on both days. Only an account maintained at a domestic financial institution which is an Automated Clearing House member may be so designated. To establish a Dreyfus-AUTOMATIC Asset Builder account, you must file an authorization form with the Transfer Agent. You may obtain the necessary authorization form by calling 1-800-645-6561. You may cancel this Privilege or change the amount of purchase at any time by mailing written notification to The Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671, 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. DREYFUS GOVERNMENT DIRECT DEPOSIT PRIVILEGE -- Dreyfus Government Direct Deposit Privilege enables you to purchase Fund shares (minimum of $100 and maximum of $50,000 per transaction) by having Federal salary, Social Security, or certain veterans', military or other payments from the Federal government automatically deposited into your Fund account. You may deposit as much of such payments as you elect. To enroll in Dreyfus Government Direct Deposit, you must file with the Transfer Agent a completed Direct Deposit Sign-Up Form for each type of payment that you desire to include in this Privilege. The appropriate form may be obtained by calling 1-800-645-6561. Death or legal incapacity will terminate your participation in this Privilege. You may elect at any time to terminate your participation by notifying in writing the appropriate Federal agency. Further, the Fund may terminate your participation upon 30 days' notice to you. DREYFUS DIVIDEND OPTIONS -- Dreyfus Dividend Sweep enables you to invest automatically divi- Page 12 dends or dividends and capital gain distributions, if any, paid by the Fund in shares of another fund in the Dreyfus Family of Funds of which you are a shareholder. Shares of the other fund will be purchased at the then-current net asset value; however, a sales load may be charged with respect to investments in shares of a fund sold with a sales load. If you are investing in a fund that charges a sales load, you may qualify for share price s which do not include the sales load or which reflect a reduced sales load. If you are investing in a fund that charges a contingent deferred sales charge, the shares purchased will be subject upon redemption to the contingent deferred sales charge, if any, applicable to the purchased shares. See "Shareholder Services" in the Statement of Additional Information. Dreyfus Dividend ACH permits you to transfer electronically your dividends or dividends and capital gain distributions, if any, from the Fund to a designated bank account. Only an account maintained at a domestic financial institution which is an Automated Clearing House member may be so designated. Banks may charge a fee for this service. For more information concerning these privileges, or to request a Dividend Options Form, please call toll free 1-800-645-6561. You may cancel these privileges by mailing written notification to The Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. Enrollment in or cancellation of these privileges is effective three business days following receipt. These privileges are available only for existing accounts and may not be used to open new accounts. Minimum subsequent investments do not apply for Dreyfus Dividend Sweep. The Fund may modify or terminate these privileges at any time or charge a service fee. No such fee currently is contemplated. Shares held under Keogh Plans, IRAs or other retirement plans are not eligible for Dreyfus Dividend Sweep. DREYFUS PAYROLL SAVINGS PLAN _ Dreyfus Payroll Savings Plan permits you to purchase Fund shares (minimum of $100 per transaction) automatically on a regular basis. Depending upon your employer's direct deposit program, you may have part or all of your paycheck transferred to your existing Dreyfus account electronically through the Automated Clearing House at each pay period. To establish a Dreyfus Payroll Savings Plan account, you must file an authorization form with your employer's payroll department. Your employer must complete the reverse side of the form and return it to The Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. You may obtain the necessary authorization form by calling 1-800-645-6561. You may change the amount of purchase or cancel the authorization only by written notification to your employer. It is the sole responsibility of your employer, not the Distributor, Dreyfus, the Fund, the Transfer Agent or any other person, to arrange for transactions under the Dreyfus Payroll Savings Plan. The Fund may modify or terminate this Privilege at any time or charge a service fee. No such fee currently is contemplated. DREYFUS STEP PROGRAM _ The Dreyfus Step Program enables you to purchase Fund shares without regard to the Fund's minimum initial investment requirements through Dreyfus-Automatic Asset Builder, Dreyfus Government Direct Deposit Privilege or Dreyfus Payroll Savings Plan. To establish a Dreyfus Step Program account, you must supply the necessary information on the Fund's Account Application and file the required authorization form(s) with the Transfer Agent. For more information concerning this Program, or to request the necessary authorization form(s), please call toll free 1-800-782-6620. You may terminate your participation in this Program at any time by discontinuing your participation in Dreyfus-Automatic Asset Builder, Dreyfus Government Direct Deposit Privilege or Dreyfus Payroll Savings Plan, as the case may be, as provided under the terms of such Privilege(s). The Fund reserves the right to redeem your account if you have terminated your participation in the Program and your account's net asset value is $500 or less. See "How to Redeem Fund Shares." The Fund may modify or terminate this Program at any time. Investors who wish to purchase Fund shares through the Dreyfus Step Program in conjunction with a Dreyfus-sponsored retirement plan may do so only for IRAs, SEP-IRAs and IRA "Rollover Accounts." You should consider your financial condition and the possibi- Page 13 lity of having to redeem your Fund shares in times of rising prices or declining Fund share prices. AUTOMATIC WITHDRAWAL PLAN _ The Automatic Withdrawal Plan permits you to request withdrawal of a specified dollar amount (minimum of $50) on either a monthly or quarterly basis if you have a $5,000 minimum account. An application for the Automatic Withdrawal Plan can be obtained by calling 1-800-645-6561. The Automatic Withdrawal Plan may be ended at any time by you, the Fund or the Transfer Agent. Shares for which stock certificates have been issued may not be redeemed through this Plan. You may make additional investments in Fund shares while an Automatic Withdrawal Plan is in effect. 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 are also 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. HOW TO REDEEM SHARES GENERAL -- You may request redemption of your shares at any time. Redemption requests should be transmitted to the Transfer Agent as described below. When a request is received in proper form, the Fund will redeem the shares at the next determined net asset value. The Fund imposes no charges when shares are redeemed directly through the Distributor. Securities dealers, banks and other financial institutions may charge a nominal fee for effecting redemptions of Fund shares. Any stock certificates representing Fund shares being redeemed must be submitted with the redemption request. The value of the shares redeemed may be more or less than their original cost, depending upon the Fund's then-current net asset value. The Fund ordinarily will make payment for all shares redeemed within seven days after receipt by the Transfer Agent of a redemption request in proper form, except as provided by the rules of the Securities and Exchange Commission. HOWEVER, IF YOU HAVE PURCHASED FUND SHARES BY CHECK, BY DREYFUS TELETRANSFER PRIVILEGE OR THROUGH DREYFUS-AUTOMATIC ASSET BUILDER AND SUBSEQUENTLY SUBMIT A WRITTEN REDEMPTION REQUEST TO THE TRANSFER AGENT, THE REDEMPTION PROCEEDS WILL BE TRANSMITTED TO YOU PROMPTLY UPON BANK CLEARANCE OF YOUR PURCHASE CHECK, DREYFUS TELETRANSFER PURCHASE OR DREYFUS-AUTOMATIC ASSET BUILDER ORDER, WHICH MAY TAKE UP TO EIGHT BUSINESS DAYS OR MORE. IN ADDITION, THE FUND WILL REJECT REQUESTS TO REDEEM SHARES BY WIRE OR TELEPHONE OR PURSUANT TO THE DREYFUS TELETRANSFER PRIVILEGE, FOR A PERIOD OF EIGHT BUSINESS DAYS AFTER RECEIPT BY THE TRANSFER AGENT OF THE PURCHASE CHECK, THE DREYFUS TELETRANSFER PURCHASE OR THE DREYFUS-AUTOMATIC ASSET BUILDER ORDER AGAINST WHICH SUCH REDEMPTION IS REQUESTED. THESE PROCEDURES WILL NOT APPLY IF YOUR SHARES WERE PURCHASED BY WIRE PAYMENT, OR IF YOU OTHERWISE HAVE A SUFFICIENT COLLECTED BALANCE IN YOUR ACCOUNT TO COVER THE REDEMPTION REQUEST. PRIOR TO THE TIME ANY REDEMPTION IS EFFECTIVE, DIVIDENDS ON SUCH SHARES WILL ACCRUE AND BE PAYABLE, AND YOU WILL BE ENTITLED TO EXERCISE ALL OTHER RIGHTS OF BENEFICIAL OWNERSHIP. Fund shares will not be redeemed until the Transfer Agent has received your Account Application. Ordinarily, the Fund will initiate payment for all shares redeemed pursuant to the regular redemption procedure, the Wire Redemption Privilege, the Telephone Redemption Privilege or the Dreyfus TELETRANSFER Privilege on the next business day after receipt by the Transfer Agent of a redemption request in proper form. The Fund reserves the right to redeem your account at its option upon not less than 30 days' written notice if your account's net asset value has been reduced to $500 or less and remains so during the notice period. PROCEDURES _ You may redeem shares by using the regular redemption procedure through the Page 14 Transfer Agent, the Wire Redemption Privilege, the Telephone Redemption Privilege, or the Dreyfus TELETRANSFER Privilege. The Fund makes available to certain large institutions the ability to issue redemption instructions through compatible computer facilities. 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 or telephone exchange privilege (which is granted automatically unless you refuse it), you authorize the Transfer Agent to act on telephone instructions from any person representing himself or herself to be you and reasonably believed by the Transfer Agent to be genuine. The Fund will require the Transfer Agent to employ reasonable procedures, such as requiring a form of personal identification, to confirm that instructions are genuine and, if it does not follow such procedures, the Fund or the Transfer Agent may be liable for any losses due to unauthorized or fraudulent instructions. Neither the Fund nor the Transfer Agent will be liable for following telephone instructions reasonably believed to be genuine. During times of drastic economic or market conditions, you may experience difficulty in contacting the Transfer Agent by telephone to request a redemption or exchange of Fund shares. In such cases, investors 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 your shares by written request mailed to The Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671, or if for Dreyfus retirement plan accounts, to The Dreyfus Trust Company, Custodian, P.O. Box 6427, Providence, Rhode Island 02940-6427. Redemption requests may be delivered in person only to a Dreyfus Financial Center. THESE REQUESTS WILL BE FORWARDED TO THE FUND AND WILL BE PROCESSED ONLY UPON RECEIPT THEREOF. 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, 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. 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. To establish the Wire Redemption Privilege, you must check the appropriate box and supply the necessary information on the Fund's Account Application or file a Shareholder Services Form with the Transfer Agent. You 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 only up to $250,000 wired within any 30-day period. You may telephone redemption requests by calling 1-800-645-6561 or, if you are call- Page 15 ing from overseas, call 516-794-5452. The Fund reserves the right to refuse any redemption request, including requests made shortly after a change of address, and may limit the amount involved or the number of such requests. This Privilege may be modified or terminated at any time by the Transfer Agent or the Fund. The Fund's 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 redeem Fund shares (maximum $150,000 per day) 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. The redemption proceeds will be paid by check and mailed to your address. You may telephone redemption instructions by calling 1-800-645-6561 or, if you are calling from overseas, call 516-794-5452. The Fund reserves the right to refuse any request made by telephone, including requests made shortly after a change of address, and may limit the amount involved or the number of telephone redemption requests. 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. DREYFUS TELETRANSFER PRIVILEGE -- You may redeem Fund shares (minimum $500 per day) by telephone if you have checked the appropriate box and supplied the necessary information on the Fund's Account Application or have filed a Shareholder Services Form with the Transfer Agent. The proceeds will be transferred between your Fund account and the bank account designated in one of these documents. Only such an account maintained in a domestic financial institution which is an Automated Clearing House member may be so designated. Redemption proceeds will be on deposit in your account at an Automated Clearing House member bank ordinarily two days after receipt of the redemption request or, at your request, paid by check (maximum $150,000 per day) and mailed to your address. Holders of jointly registered Fund or bank accounts may redeem through the Dreyfus TELETRANSFER Privilege for transfer to their bank account only up to $250,000 within any 30-day period. The Fund reserves the right to refuse any request made by 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 this Privilege at any time or charge a service fee upon notice to shareholders. No such fee currently is contemplated. If you have selected the Dreyfus TELETRANSFER Privilege, you may request a Dreyfus TELETRANSFER redemption of Fund shares by telephoning 1-800-645-6561 or, if you are calling from overseas, call 516-794-5452. Shares held under Keogh, IRAs or other retirement plans, and shares issued in certificate form, are not eligible for this Privilege. SHAREHOLDER SERVICES PLAN The Fund has adopted a Shareholder Services Plan pursuant to which the Fund reimburses Dreyfus Service Corporation, a subsidiary of Dreyfus, an amount not to exceed an annual rate of .25 of 1% of the value of the average daily net assets of the Fund's shares 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. DIVIDENDS, DISTRIBUTIONS AND TAXES The Fund ordinarily pays dividends from net investment income and makes distributions from net realized securities gains, if any, once a year, but it may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code of 1986, as amended (the Page 16 "Code"), in all events in a manner consistent with the provisions of the Act. The Fund will not make distributions from net realized securities gains unless capital loss carryovers, if any, have been utilized or have expired. You may choose whether to receive dividends and distributions in cash or to reinvest in additional Fund shares at net asset value. All expenses are accrued daily and deducted before the declaration of dividends to investors. Dividends paid by the Fund derived from net investment income, together with distributions from net realized short-term securities gains and all or a portion of gains realized from the sale or other disposition of certain market discount bonds, will be taxable to U.S. shareholders as ordinary income whether or not reinvested. Distributions from net realized long-term securities gains of the Fund will be taxable to U.S. shareholders as long-term capital gains, regardless of how long shareholders have held their Fund shares and whether such distributions are received in cash or reinvested in Fund shares. The Code currently 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, together with distributions from net realized short-term securities gains and all or a portion of gains realized from the sale or other disposition of certain market discount bonds, paid by the Fund to a foreign investor generally are subject to U.S. nonresident withholding taxes 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 the extent to which gain or loss may be realized, generally will not be subject to any U.S. nonresident withholding tax. However, such distributions and redemption proceeds 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 and the proceeds of any redemption, regardless of the extent to which gain or loss may be realized, paid to a shareholder of the Fund 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 May 31, 1996 as a "regulated investment company" under the Code. The Fund intends to continue to so qualify so long as such qualification is in the best interests of its shareholders. Such qualification relieves the Fund of any liability for Federal income taxes to the extent its net investment income and realized capital gains are distributed in accordance with the 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. Page 18 You should consult your tax adviser regarding specific questions as to Federal, state and local taxes. PERFORMANCE INFORMATION For purposes of advertising, performance will be calculated on the basis of average annual total return. Advertisements may also include performance calculated on the basis of 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. Total return is computed on a per share basis and assumes the reinvestment of dividends and distributions. Total return generally is expressed as a percentage rate which is calculated by combining the income and principal changes for a specified period and dividing by the net asset value per share at the beginning of the period. Advertisements may include the percentage rate of total return or may include the value of a hypothetical investment at the end of the period which assumes the application of the percentage rate of total return. Performance will vary from time to time and past results are not necessarily representative of future results. You should remember that performance is a function of portfolio management in selecting the type and quality of portfolio securities and is affected by operating expenses. Performance information, such as that described above, may not provide a basis for comparison with other investments or other investment companies using a different method of calculating performance. Comparative performance information may be used from time to time in advertising or marketing the Fund's shares, including data from Lipper Analytical Services, Inc., Dow Jones Industrial Average, Standard & Poor's 500 Composite Stock Price Index, Morningstar, Inc. or other industry publications GENERAL INFORMATION The Fund was incorporated under Delaware law on May 6, 1971 and began operations on March 29, 1972. On July 30, 1982, the Fund changed its state of incorporation to Maryland. In April 1996, at a meeting of shareholders of the Fund, shareholders approved changes in the Fund's fundamental policies and investment restrictions and an Amended and Restated Sub-Investment Advisory Agreement between Dreyfus and NCM. The Fund is authorized to issue 150 million shares of Common Stock, par value $.331/3 per share. Each share has one vote, has equal voting, redemption, dividend and liquidation rights, and, when issued in accordance with the terms of this offering, is fully-paid and non-assessable. Shares are freely transferable and are redeemable at net asset value, at the option of the shareholder. Unless otherwise required by the 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 the purpose of removing a Director from office and the holders of at least 25% of such shares may require the Fund to hold a special meeting of shareholders for any other purpose. Fund shareholders may remove a Director by the affirmative vote of a majority of the Fund's outstanding voting shares. In addition, the Board of Directors will call a meeting of shareholders for the purpose of electing Directors if, at any time, less than a majority of the Directors holding office at the time were Page 18 elected by shareholders. The Transfer Agent maintains a record of each shareholder's ownership and will send confirmations and statements of account to each shareholder. 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 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. Page 19 The Dreyfus Third Century Fund, Inc. Prospectus Registration Mark Copy Rights 1996 Dreyfus Service Corporation 035p1010196 This Prospectus is Printed on Recycled Paper. Page 20 __________________________________________________________________________ THE DREYFUS THIRD CENTURY FUND, INC. (STATEMENT OF ADDITIONAL INFORMATION) PART B OCTOBER 1, 1996 __________________________________________________________________________ This Statement of Additional Information, which is not a prospectus, supplements and should be read in conjunction with the current Prospectus of The Dreyfus Third Century Fund, Inc. (the "Fund"), dated October 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 718-895-1206 Outside the U.S. and Canada -- Call 516-794-5452 The Dreyfus Corporation (the "Manager") serves as the Fund's investment adviser. NCM Capital Management Group, Inc. ("NCM") serves as the Fund's sub- investment adviser. NCM provides day-to-day management of the Fund's portfolio, subject to the supervision of the Manager. Premier Mutual Fund Services, Inc. (the "Distributor") is the distributor of the Fund's shares. TABLE OF CONTENTS Page Investment Objectives and Management Policies. . . . . . . . . . . . B-2 Management of the Fund . . . . . . . . . . . . . . . . . . . . . . . B-6 Investment Advisory Agreements . . . . . . . . . . . . . . . . . . . B-9 Purchase of Shares . . . . . . . . . . . . . . . . . . . . . . . . . B-12 Redemption of Shares . . . . . . . . . . . . . . . . . . . . . . . . B-14 Shareholder Services . . . . . . . . . . . . . . . . . . . . . . . . B-15 Determination of Net Asset Value . . . . . . . . . . . . . . . . . . B-19 Shareholder Services Plan. . . . . . . . . . . . . . . . . . . . . . B-19 Dividends, Distributions and Taxes . . . . . . . . . . . . . . . . . B-20 Portfolio Transactions . . . . . . . . . . . . . . . . . . . . . . . B-22 Performance Information. . . . . . . . . . . . . . . . . . . . . . . B-23 Information About the Fund . . . . . . . . . . . . . . . . . . . . . B-23 Custodian, Transfer and Dividend Disbursing Agent, Counsel and Independent Auditors . . . . . . . . . . . . . . . . . B-23 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . B-25 Report of Independent Auditors . . . . . . . . . . . . . . . . . . . B-34 INVESTMENT OBJECTIVES AND MANAGEMENT POLICIES The following information supplements and should be read in conjunction with the section in the Fund's Prospectus entitled "Description of the Fund." Portfolio Securities. During a period when it becomes desirable to move the Fund toward a defensive position because of adverse trends in the financial markets or the economy, the Fund may invest in securities issued or guaranteed by the U.S. Government or its agencies or instrumentalities. These include a variety of U.S. Treasury securities, which differ in their interest rates, maturities and times of issuance: Treasury Bills have initial maturities of one year or less; Treasury Notes have initial maturities of one to ten years; and Treasury Bonds generally have initial maturities of greater then ten years. Some obligations issued or guaranteed by U.S. Government agencies and instrumentalities, such as Government National Mortgage Association pass-through certificates, are supported by the full faith and credit of the U.S. Treasury; others, such as those of the Federal Home Loan Banks, by the right of the issuer to borrow from the U.S. Treasury; others, such as those issued by the Federal National Mortgage Association, by discretionary authority of the U.S. Government to purchase certain obligations of the agency or instrumentality; and others, such as those issued by the Student Loan Marketing Association, only by the credit of the instrumentality. These securities bear fixed, floating or variable rates of interest. Principal and interest may fluctuate based on generally recognized reference rates or the relationship of rates. While the U.S. Government provides financial support to such U.S. Government- sponsored agencies or instrumentalities, no assurance can be given that it will always do so since it is not so obligated by law. The Fund will invest in such securities only when the Fund is satisfied that the credit risk with respect to the issuer is minimal. The Board of Directors of the Fund may, to a limited extent, authorize the purchase of securities of foreign companies which have not been declared eligible for investment ("ineligible securities") in order to facilitate the purchase of securities of other foreign companies which are contributing or will contribute to the enhancement of the quality of life in America and which have been declared eligible for investment ("eligible securities"). Certain countries have limited, either permanently or temporarily, the ability of foreigners to purchase shares of their domestic companies, shares which are already owned outside the country or shares which may be obtained through the sale of shares of other companies located in the same country which are owned outside that country. Accordingly, the Fund may purchase ineligible securities so that these securities may be sold or redeemed in the country of origin, and the proceeds thus received used for the purchase of eligible securities. Otherwise ineligible securities purchased for this limited purpose would be held in the Fund's portfolio for a maximum of 60 days in order to enable the Fund to have sufficient time to provide for the transportation of the securities and their sale or redemption. Most transactions of this type, however, are expected to be completed in a much shorter period. Furthermore, such investments are limited, as a fundamental policy, in the aggregate, to a maximum of 2% of the net assets of the Fund at the time of investment. Engaging in these transactions will result in additional expense to the Fund in the form of brokerage commissions incurred in the purchase and sale of the ineligible security. Finally, the Board of Directors would authorize investments in ineligible securities only for the purpose of facilitating the purchase of securities of a specific eligible company. Writing and Purchasing Options. To earn additional income on its portfolio, the Fund, to a limited extent, may write covered call options on securities owned by the Fund ("covered options" or "options") and purchase call options in order to close option transactions, as described below. A call option gives the purchaser of the option the right to buy, and obligates the writer to sell, the underlying security at the exercise price at any time during the option period, regardless of the market price of the security. The premium paid to the writer is the consideration for undertaking the obligations under the option contract. When a covered option is written by the Fund, the Fund will make arrangements with the Fund's Custodian, to segregate the underlying securities until the option either is exercised, expires or the Fund closes out the option as described below. A covered option sold by the Fund exposes the Fund during the term of the option to possible loss of opportunity to realize appreciation in the market price of the underlying security or to possible continued holding of a security which might otherwise have been sold to protect against depreciation in the market price of the security. To limit this exposure, the value of the portfolio securities underlying covered call options written by the Fund will be limited to an amount not in excess of 20% of the value of the Fund's net assets at the time such options are written. The Fund will purchase call options only to close out open positions. To close out a position, the Fund may make a "closing purchase transaction," which involves purchasing a call option on the same security with the same exercise price and expiration date as the option which it has previously written on a particular security. The Fund will realize a profit (or loss) from a closing purchase transaction if the amount paid to purchase a call option is less (or more) than the amount received from the sale thereof. Illiquid Securities. The Fund may invest up to 15% of the value of its net assets in securities which are illiquid securities. Illiquid securities are securities which are not readily marketable, including those with restrictions on resale. Rule 144A under the Securities Act of 1933, as amended (the "Securities Act"), permits certain resales of restricted securities to qualified institutional buyers without registration under the Securities Act ("Rule 144A Securities"). Because it is not possible to predict with assurance how the market for Rule 144A Securities will develop, the Fund's Board has directed the Manager to monitor carefully the Fund's investments in such securities with particular regard to trading activity, availability of reliable price information and other relevant information, and has approved procedures to determine whether a readily available market exists. Rule 144A Securities for which there is a readily available market are not illiquid. When the Fund purchases securities that are illiquid due to the fact that such securities have not been registered under the Securities Act, the Fund will endeavor to obtain the right to registration at the expense of the issuer. Generally, there will be a lapse of time between the Fund's decision to sell any such securities and the registration of the securities permitting sale. The valuation of illiquid securities will be monitored by the Manager subject to the supervision of the Fund's Board. Investment Restrictions. The Fund has adopted investment restrictions numbered 1 through 16 as fundamental policies. These restrictions cannot be changed without approval by the holders of a majority, as defined in the Investment Company Act of 1940, as amended (the "Act"), of the Fund's outstanding voting shares. Investment restrictions numbered 17 and 18 are not fundamental policies and may be changed by vote of a majority of the Fund's Directors at any time. 1. The Fund's special considerations described under "Special Considerations-Types of Companies Sought for Investment" in the Fund's Prospectus will not be changed without stockholder approval. The Board of Directors may from time to time without stockholder approval adopt additional criteria or restrictions governing the Fund's investments if the Board of Directors determines that the new criteria or restrictions are consistent with the Fund's objective of investing in a socially responsible manner. Any such new criteria or restrictions would not be fundamental policies of the Fund and could be subsequently terminated or changed by the Board of Directors at any time without stockholder approval. 2. The Fund may not purchase the securities of any issuer if such purchase would cause more than 5% of the value of its total assets to be invested in securities of such issuer (except securities of the United States Government or any instrumentality thereof). 3. The Fund may not purchase the securities of any issuer if such purchase would cause the Fund to hold more than 10% of the outstanding voting securities of such issuer. 4. The Fund may not purchase securities of any company having less than three years' continuous operating history (including that of any predecessors) if such purchase would cause the value of the Fund's investments in all such securities to exceed 5% of the value of its net assets. See also Investment Restriction No. 10. 5. The Fund may not purchase securities of closed-end investment companies except in connection with a merger or consolidation of portfolio companies. The Fund shall not purchase or retain securities issued by open-end investment companies other than itself. 6. The Fund may not purchase or retain the securities of any issuer if officers or directors of the Fund or of its investment adviser, who own beneficially more than 1/2 of 1% of the securities of such issuer together own beneficially more than 5% of the securities of such issuer. 7. The Fund may not purchase, hold or deal in commodities or commodity contracts, in oil, gas, or other mineral exploration or development programs, or in real estate but this shall not prohibit the Fund from investing, consistent with Item 18 below, in securities of companies engaged in oil, gas or mineral investments or activities. This limitation shall not prevent the Fund from investing in securities issued by a real estate investment trust, provided that such trust is not permitted to invest in real estate or in interests other than mortgages or other security interests. 8. The Fund may not borrow money, except to the extent permitted under the Act (which currently limits borrowing to no more than 33-1/3% of the value of the Fund's total assets). 9. The Fund may not make loans other than by the purchase, consistent with Item 18 below, of bonds, debentures or other debt securities of the types commonly offered privately and purchased by financial institutions. The purchase of a portion of an issue of publicly distributed debt obligations shall not constitute the making of loans. 10. The Fund may not act as an underwriter of securities of other issuers. 11. The Fund may not purchase from or sell to any of its officers or directors, or firms of which any of them are members, any securities (other than capital stock of the Fund), but such persons or firms may act as brokers for the Fund for customary commissions. 12. The Fund may not 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. 13. The Fund may not purchase securities on margin, but the Fund may obtain such short-term credit as may be necessary for the clearance of purchases and sales of securities. 14. The Fund may not sell any security short or engage in the purchase and sale of put, call, straddle, or spread options or combinations thereof, or in writing such options, except that the Fund may write and sell covered call option contracts on securities owned by the Fund up to, but not in excess of, 20% of the market value of its net assets at the time such option contracts are written. The Fund may also purchase call options for the purpose of terminating its outstanding obligations with respect to securities upon which covered call option contracts have been written. In connection with the writing of covered call options, the Fund may pledge assets to an extent not greater than 20% of the market value of its total net assets at the time such options are written. 15. The Fund may not concentrate its investments in any particular industry or industries, except that the Fund may invest up to 25% of the value of its total assets in a single industry. 16. The Fund may not purchase warrants in excess of 2% of the value of its net assets. Such warrants shall be valued at the lower of cost or market, except that warrants acquired by the Fund in units or attached to securities shall be deemed to be without value, for purposes of this restriction only. 17. The Fund may not pledge, mortgage, hypothecate or otherwise encumber its assets, except to the extent necessary to secure permitted borrowings. 18. The Fund may not enter into repurchase agreements providing for settlement in more than seven days after notice or purchase securities which are illiquid if, in the aggregate, more than 15% of the value of the Fund's net assets would be so invested. If a percentage restriction is adhered to at the time of investment, a later increase or decrease in percentage resulting from a change in values or assets will not constitute a violation of that restriction. The Fund may make commitments more restrictive than the restrictions noted above so as to permit the sale of Fund shares in certain states. Should the Fund determine that a commitment is no longer in the best interests of the Fund and its shareholders, the Fund reserves the right to revoke the commitment by terminating the sale of Fund shares in the state involved. MANAGEMENT OF THE FUND Directors and officers of the Fund are shown below, together with information as to their principal business occupation during at least the last five years. Each Director who is deemed an "interested person" of the Fund as defined in the Act, is indicated by an asterisk. Directors of the Fund CLIFFORD L. ALEXANDER, JR., Director. President of Alexander & Associates, Inc., a management consulting firm. From 1977 to 1981, Mr. Alexander served as Secretary of the Army and Chairman of the Board of the Panama Canal Company and from 1975 to 1977 he was a member of the Washington, D.C. law firm of Verner, Liipfert, Bernhard, McPherson and Alexander. He is a director of American Home Products Corporation, The Dun & Bradstreet Corporation, Equitable Resources, Inc., a producer and distributor of natural gas and crude petroleum, MCI Communications Corporation and Mutual of America Life Insurance Company. He is 62 years old and his address is 400 C Street N.E., Washington, D.C. 20002. LUCY WILSON BENSON, Director. President of Benson and Associates, consultants to business and government. Mrs. Benson is a Director of COMSAT Corporation, General Re Corporation and Logistics Management Institute. She is also a Trustee of the Alfred P. Sloan Foundation, Vice Chairman of the Board of Trustees of Lafayette College, Vice Chairman of the Citizens Network for Foreign Affairs and a member of the Council on Foreign Relations. Mrs. Benson served as a consultant to the U.S. Department of State and to SRI International from 1980 to 1981. From 1977 to 1980, she was Under Secretary of State for Security Assistance, Science and Technology. She is 69 years old and her address is 46 Sunset Avenue, Amherst, Massachusetts 01002. *JOSEPH S. DiMARTINO, Chairman of the Board. Since January 1995, Chairman of the Board for various funds in the Dreyfus Family of Funds. For more than five years prior thereto, he was President, a director and, until August 1994, Chief Operating Officer of the Manager and Executive Vice President and a director of Dreyfus Service Corporation, a wholly-owned subsidiary of the Manager and until August 24, 1994, the Fund's distributor. From August 1994 to December 31, 1994, he was a director of Mellon Bank Corporation. He is Chairman of the Board of Directors of Noel Group, Inc.; a trustee of Bucknell University; a director of The Muscular Dystrophy Association, HealthPlan Services Corporation, Belding Heminway Company, Inc., Curtis Industries, Inc., Simmons Outdoor Corporation, and Staffing Resources, Inc. He is 52 years old and his address is 200 Park Avenue, New York, New York 10166. PETER C. GOLDMARK, JR., Director. Since July 1988, President of The Rockefeller Foundation, an organization which promotes research and educational activities. He is also a trustee of The Rockefeller Foundation and a director of Knight-Ridder, Inc. From 1985 to 1988, Mr. Goldmark was Senior Vice President of Times Mirror Company and from 1977 to 1985 he was Executive Director of The Port Authority of New York and New Jersey. He is 55 years old and his address is 420 Fifth Avenue, New York, New York 10018. 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 Act, will be selected and nominated by the Directors who are not "interested persons" of the Fund. The Fund typically pays its Directors an annual retainer fee and reimburses them for their Board meeting expenses. The Chairman of the Board receives an additional 25% of such compensation. Any Director who becomes an Emeritus Director shall be entitled to receive an annual retainer fee of one-half the amount paid to Directors. The aggregate amount of compensation paid to each Director by the Fund (for the fiscal year ended May 31, 1996) 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 Director's total compensation) for the year ended December 31, 1995, were as follows:
(5) (3) Total (2) Pension or Compensation Aggregate Retirement (4) From Fund and (1) Compensation Benefits Accrued Estimated Annual Fund Complex Name of Board From as Part of Benefits Upon Paid to Board Member Fund1 Fund's Expenses Retirement Member - -------------- ------------- ----------------- ----------------- -------------- Clifford L. Alexander $10,000 none none $ 94,386 (17) Lucy Wilson Benson $10,000 none none $ 72,003 (13) Joseph S. DiMartino $12,5002 none none $448,6182 (93) Peter C. Goldmark $10,000 none none $ 12,500 (1) Josie Cruz Natori3 $10,000 none none $ 12,500 (1)
_________________________ 1 Amount does not include reimbursed expenses for attending Board meetings, which amounted to $2,101 for all Directors a group. 2 Estimated amount for the current year ending December 31, 1996. 3 Josie Cruz Natori resigned as a Director of the Fund effective as of June 28, 1996. Officers of the Fund MARIE E. CONNOLLY, President and Treasurer. President and Chief Operating Officer and a Director of the Distributor and an officer of other investment companies advised or administered by the Manager. From December 1991 to July 1994, she was President and Chief Compliance Officer of Funds Distributor, Inc., the ultimate parent company 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 of the Distributor and an officer of other investment companies advised or administered by the Manager. From February 1992 to July 1994, he served as Counsel for The Boston Company Advisors, Inc. Prior thereto, he was employed as an Associate at Ropes & Gray, and prior to August 1990, he was employed as an Associate at Sidley & Austin. He is 32 years old. JOSEPH S. TOWER, Vice President and Assistant Treasurer. Senior Vice President, Treasurer and Chief Financial Officer of the Distributor and an officer of other investment companies advised or administered by the Manager. From July 1988 to August 1994, he was employed by The Boston Company, Inc. where he held various management positions in the Corporate Finance and Treasury areas. He is 34 years old. ELIZABETH BACHMAN, Vice President and Assistant Secretary. Assistant Vice President of the Distributor and an officer of other investment companies advised or administered by the Manager. She is 26 years old. RICHARD W. INGRAM, Vice President and Assistant Secretary. Senior Vice President and Director of Client Services and Treasury Operations of the Distributor and an officer of other investment companies advised or administered by the Manager. From March 1994 to November 1995, he was Vice President and Division Manager for First Data Investor Services Group. From 1989 to 1994, Mr. Ingram was Vice President, Assistant Treasurer and Tax Director - Mutual Funds of The Boston Company. He is 40 years old. MARY A. NELSON, Vice President and Assistant Treasurer. Vice President and Manager of Treasury Services and Administration of the Distributor, and an officer of other investment companies advised or administered by the Manager. From September 1989 to July 1994, she was an Assistant Vice President and Client Manager for The Boston Company. She is 32 years old. DOUGLAS C. CONROY, Vice President and Assistant Secretary. Supervisor of Treasury Services and Administration of the Distributor and an officer of other investment companies advised or administered by the Manager. From April 1993 to January 1995, he was a Senior Fund Accountant for Investors Bank and Trust Company. From December 1991 to March 1993, he was employed as a Fund Accountant at The Boston Company. He 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 outstanding common stock of the Fund on July 15, 1996. The following person is known by the Fund to own of record 5% or more of the Fund's voting securities outstanding on July 15, 1996: Nationwide Life Insurance Company, C/O IPO Co 53, P.O. Box 182029 Columbus, OH 43218- - -5.22%. INVESTMENT ADVISORY AGREEMENTS 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. The Manager provides investment advisory services pursuant to the Management Agreement (the "Agreement") dated August 2, 1994, between the Manager and the Fund which is subject to annual approval by (i) the Board of Directors of the Fund or (ii) vote of a majority (as defined in the 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 of Directors who are not "interested persons" (as defined in the Act) of any party to the Agreement, by vote cast in person at a meeting called for the purpose of voting on such approval. The Board of Directors, including a majority of the Directors who are not "interested persons," last approved the Agreement at a meeting held on July 18, 1996. Shareholders approved the Agreement on August 2, 1994. The Agreement is terminable without penalty, on 60 days' notice, by the Board of Directors of the Fund or by vote of the holders of a majority of the Fund's shares, or, upon not less than 90 days' notice, by the Manager. The Agreement will terminate automatically in the event of its assignment (as defined in the Act). As compensation for the Manager's services to the Fund, under the Agreement the Fund has agreed to pay the Manager a fee payable monthly at an annual rate of .75 of 1% of the Fund's average daily net assets. Prior to August 2, 1994, the Manager provided investment advisory services to the Fund pursuant to an Investment Advisory Agreement with the Fund (the "Prior Advisory Agreement") dated August 27, 1990. Pursuant to the Prior Advisory Agreement, the Fund agreed to pay the Manager an advisory fee at the annual rate of .65 of 1% of the Fund's average daily net assets up to $200 million; .40 of 1% of the Fund's average daily net assets for the next $100 million; and .375 of 1% of the Fund's average daily net assets in excess of $300 million. Pursuant to the Prior Advisory Agreement, the Fund paid the Manager an investment advisory fee for the fiscal year ended May 31, 1994 of $2,374,676. For the period from June 1, 1994 through August 1, 1994, the Fund paid the Manager pursuant to the Prior Advisory Agreement a fee of $332,837. For the period from August 2, 1994 through May 31, 1995 the Fund paid the Manager pursuant to the Agreement a fee of $2,229,348. For the fiscal year ended May 31, 1996, the Fund paid the Manager pursuant to the Agreement a fee of $3,154,864. The following persons are officers and/or directors of the Manager: Howard Stein, Chairman of the Board and Chief Executive Officer; W. Keith Smith, Vice Chairman of the Board; Christopher M. Condron, President, Chief Operating Officer and a director; Stephen E. Canter, Vice Chairman, Chief Investment Officer and a director; Lawrence S. Kash, Vice Chairman- Distribution and a director; Philip L. Toia, Vice Chairman-Operations and Administration and a director; William T. Sandalls, Jr., Senior Vice President and Chief Financial Officer; Elie M. Genadry, Vice President- Institutional Sales; William F. Glavin, Jr., Vice President-Corporate Development; Mark N. Jacobs, Vice President, General Counsel and Secretary; Patrice M. Kozlowski, Vice President-Corporate Communications; Mary Beth Leibig, Vice President-Human Resources; Jeffrey N. Nachman, Vice President-Mutual Fund Accounting; Andrew S. Wasser, Vice President- Information Systems; Elvira Oslapas, Assistant Secretary; and Mandell L. Berman, Frank V. Cahouet, Alvin E. Friedman, Lawrence M. Greene and Julian M. Smerling, directors. Amended and Restated Sub-Investment Advisory Agreement. NCM provides sub-investment advisory services pursuant to an Amended and Restated Sub-Investment Advisory Agreement dated April 22, 1996 between the Manager and NCM. The Amended and Restated Sub-Investment Advisory Agreement is subject to annual approval by (i) the Board of Directors of the Fund or (ii) vote of a majority (as defined in the Act) of the Fund's outstanding voting securities, provided that in either event the continuance also is approved by a majority of the Directors who are not "interested persons" (as defined in the Act) of any party to the Amended and Restated Sub- Investment Advisory Agreement, by vote cast in person at a meeting called for the purpose of voting on such approval. The Board of Directors, including a majority of the Directors who are not "interested persons", last approved the Amended and Restated Sub-Investment Advisory Agreement at a meeting held on July 18, 1996. Shareholders approved the Amended and Restated Sub-Investment Advisory Agreement on April 18, 1996. The Amended and Restated Sub-Investment Agreement contains a restriction on NCM's ability to act as the investment adviser or sub-investment adviser for other registered funds with socially responsible investment policies without the consent of the Fund or the Manager. The Amended and Restated Sub-Investment Advisory Agreement is terminable without penalty, on 60 days' notice, by the Manager, by the Board of Directors of the Fund or by vote of the holders of a majority of the Fund's shares, or, upon not less than 90 days' notice, by NCM. The Amended and Restated Sub-Investment Advisory Agreement will terminate automatically in the event of its assignment (as defined in the Act). In addition, if the Management Agreement terminates for any reason, the Amended and Restated Sub- Investment Advisory Agreement will terminate effective upon the date the Management Agreement terminates. As compensation for NCM's services under the Amended and Restated Sub-Investment Advisory Agreement, the Manager has agreed to pay NCM a fee, payable monthly, at an annual rate as set forth in the Fund's Prospectus. For the period August 2, 1994 through April 21, 1996, NCM served as the Fund's sub-investment adviser pursuant to a sub-investment advisory agreement (the "Former NCM Agreement") dated August 2, 1994 between NCM and Dreyfus. Pursuant to the Former NCM Agreement, Dreyfus agreed to pay NCM a sub-investment advisory fee at the annual rate of .10 of 1% of the Fund's average daily net assets up to $500 million; and .20 of 1% of the Fund's average daily net assets in excess of $500 million. Prior to August 2, 1994, Tiffany Capital Advisors, Inc. ("Tiffany") served as the Fund's sub-investment adviser pursuant to a sub-investment advisory agreement (the "Prior Sub-Advisory Agreement") dated August 27, 1990 between Tiffany and the Fund. Pursuant to the Prior Sub-Advisory Agreement, the Fund agreed to pay Tiffany a sub-investment advisory fee at the annual rate of .10 of 1% of the Fund's average daily net assets up to $200 million; .35 of 1% of the Fund's average daily net assets for the next $100 million; and .375 of 1% of the Fund's average daily net assets in excess of $300 million. The sub-investment advisory fees paid by the Fund pursuant to the Prior Sub-Advisory Agreement for the fiscal year ended May 31, 1994 and for the period from June 1, 1994 to August 1, 1994 were $1,224,676 and $141,170, respectively. For the period from August 2, 1994 to May 31, 1995, Dreyfus paid NCM a sub-advisory fee of $297,131 pursuant to the Former NCM Agreement. For the period from June 1, 1995 to April 21, 1996, Dreyfus paid NCM a sub-advisory fee of $382,143 pursuant to the Former NCM Agreement and for the period from April 22, 1996 to May 31, 1996, Dreyfus paid NCM a sub-advisory fee of $42,614 pursuant to the Amended and Restated Sub-Investment Advisory Agreement. The following persons are officers and/or directors of NCM: Maceo K. Sloan, Chairman, President and Chief Executive Officer; Justin F. Beckett, Executive Vice President and Director; Peter J. Anderson, Director; Morris Goodwin, Jr., Director; Edith H. Noel, Senior Vice President, Corporate Secretary and Treasurer; Clifford D. Mpare, Jr., Senior Vice President- Investments; Brenda Walker, Senior Vice President-Director Marketing and Client Services; Dennis M. McCaskill, Jr., Mary M. Ford, Stanley G. Laborde, Paul L. VanKempen, Senior Vice Presidents; Stephon Jackson, Senior Vice President, Director of Research; Linda Jordan, Victor Ross, Regional Vice Presidents; David Carter, Wendell Mackey, Lorenzo Newsome and Lawrence Verny, Vice Presidents; Deborah C. Bronson, Vice President- Director of Operations; Marc Reid, Assistant Vice President-Manager of Marketing and Client Services. NCM provides day-to-day management of the Fund's portfolio of investments in accordance with the stated policies of the Fund, subject to the supervision of the Manager and the approval of the Fund's Board of Directors. The Manager and NCM provide the Fund with Portfolio Managers who are authorized by the Directors to execute purchases and sales of securities. The Fund's Portfolio Managers are Eric Steedman, Maceo K. Sloan and Stephon Jackson. The Manager also maintains a research department with a professional staff of portfolio managers and securities analysts who provide research services for the Fund as well as for other funds advised by the Manager. All purchases and sales are reported for the Directors' review at the meeting subsequent to such transactions. Expenses. All expenses incurred in the operation of the Fund are borne by the Fund, except to the extent specifically assumed by the Manager or NCM. The expenses borne by the Fund include: organizational costs, taxes, interest, loan commitment fees, interest and distributions on securities sold short, brokerage fees and commissions, if any, fees of Directors who are not officers, directors, employees or holders of 5% or more of the outstanding voting securities of the Manager or NCM, or any affiliate of the Manager or NCM, Securities and Exchange Commission fees, state Blue Sky qualification fees, advisory fees, charges of custodians, transfer and dividend disbursing agents' fees, certain insurance premiums, industry association fees, outside auditing and legal expenses, costs of maintaining the Fund's existence, costs of independent pricing services, costs attributable to investor services (including, without limitation, telephone and personnel expenses), cost of shareholders' reports and meetings, costs of preparing, printing and distributing certain prospectuses and statements of additional information, and any extraordinary expenses. The Manager and NCM have agreed that if, in any fiscal year, the aggregate expenses of the Fund, exclusive of taxes, brokerage, interest and (with the prior written consent of the necessary state securities commissions) extraordinary expenses, but including the management and sub-advisory fees, exceed 1-1/2% of the average value of the Fund's net assets for the fiscal year, the Fund may deduct from the fees to be paid to the Manager and NCM, or each will bear, the excess expense. For each fiscal year of the Fund, the Manager and NCM will pay or bear such excess on a pro rata basis in proportion to the relative fees otherwise payable to each pursuant to the Management Agreement and the Amended and Restated Sub-Investment Advisory Agreement, respectively. Such deduction or payment, if any, will be estimated, reconciled and effected or paid, as the case may be, on a monthly basis and will be limited to the amount of fees otherwise payable to the Manager and NCM under each respective agreement. PURCHASE OF SHARES The following information supplements and should be read in conjunction with the section in the Fund's Prospectus entitled "How to Buy Shares." The Distributor. The Distributor serves as the Fund's distributor 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. Using Federal Funds. Dreyfus Transfer, Inc., the Fund's transfer and dividend disbursing agent (the "Transfer Agent") or the Fund may attempt to notify the investor upon receipt of checks drawn on banks that are not members of the Federal Reserve System as to the possible delay in conversion into Federal Funds and may attempt to arrange for a better means of transmitting the money. If the investor is a customer of a securities dealer, bank or other financial institution and his order to purchase Fund shares is paid for other than in Federal Funds, the securities dealer, bank or other financial institution, acting on behalf of its customer, will complete the conversion into, or itself advance, Federal Funds generally on the business day following receipt of the customer order. The order is effective only when so converted and received by the Transfer Agent. An order for the purchase of Fund shares placed by an investor with sufficient Federal Funds or cash balance in his brokerage account with a securities dealer, bank or other financial institution will become effective on the day that the order, including Federal Funds, is received by the Transfer Agent. In some states, banks or other financial institutions effecting transactions in Fund shares may be required to register as a dealer pursuant to state law. Dreyfus TeleTransfer Privilege. Dreyfus TeleTransfer purchase orders may be made between the hours of 8:00 A.M. and 4:00 P.M., New York time, on any business day that the Transfer Agent and the New York Stock Exchange are open. Such purchases will be credited to the shareholder's Fund account on the next bank business day. To qualify to use Dreyfus TeleTransfer Privilege, the initial payment for purchase of Fund shares must be drawn on, and redemption proceeds paid to, the same bank and account as are designated on the Account Application or Shareholder Services Form on file. If the proceeds of a particular redemption are to be wired to an account at any other bank, the request must be in writing and signature-guaranteed. See also "Redemption of Shares - Dreyfus TeleTransfer Privilege." Reopening an Account. An investor may reopen an account with a minimum investment of $100 without filing a new Account Application during the calendar year the account is closed or during the following calendar year, provided that the information on the old Account Application is still applicable. REDEMPTION OF SHARES The following information supplements and should be read in conjunction with the section in the Fund's Prospectus entitled "How to Redeem Shares." Wire Redemption Privilege. By using this Privilege, the investor authorizes the Transfer Agent to act on wire or telephone redemption instructions from any person representing himself or herself to be the investor, 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 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. Redemption proceeds, if wired, must be in the amount of $1,000 or more and will be wired to the investor's account at the bank of record designated in the investor's file at the Transfer Agent, if the investor's bank is a member of the Federal Reserve System, or to a correspondent bank if the investor's bank is not a member. 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 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." Dreyfus TeleTransfer Privilege. Investors should be aware that if they have selected the Dreyfus TeleTransfer Privilege, requests for redemption, including wire redemption will be effected as a Dreyfus TeleTransfer transaction, not a Wire Redemption transaction, through the Automated Clearing House ("ACH") system unless more prompt transmittal specifically is requested. Redemption proceeds will be on deposit in the investor's account at an ACH member bank ordinarily two business days after receipt of the redemption request. See "Purchase of Shares - Dreyfus TeleTransfer Privilege." Stock Certificates; Signatures. Any stock certificates representing Fund shares to be redeemed must be submitted with the redemption request. Written redemption requests must be signed by each shareholder, including each owner of a joint account and each signature must be guaranteed. Signatures on endorsed certificates submitted for redemption also must be guaranteed. The Transfer Agent has adopted standards and procedures pursuant to which signature-guarantees in proper form generally will be accepted from domestic banks, brokers, dealers, credit unions, national securities exchanges, registered securities associations, clearing agencies and savings associations. Guarantees must be signed by an authorized signatory of the guarantor and "Signature-Guaranteed" should 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 numbers listed on the cover. Redemption Commitment. The Fund has committed itself to pay in cash for 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 in part in securities (which may include non-marketable securities) or other assets of the Fund in case of an emergency or any time a cash distribution would impair the liquidity of the Fund to the detriment of the existing shareholders. In this event, the securities would be valued in the same manner as the portfolio of the Fund. If the recipient sold such securities, brokerage charges would be incurred. There is no charge for redemption. Should such a charge be established, shareholders will be given written notice and a reasonable period within which to redeem shares without charge. 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 normally utilizes is restricted, or when an emergency exists as determined by the Securities and Exchange Commission so that disposal of the Fund's investments or determination of its net asset value is not reasonably practicable, or (c) for such other periods as the Securities and Exchange Commission by order may permit to protect the Fund's shareholders. SHAREHOLDER SERVICES The following information supplements and should be read in conjunction with the section in the Fund's Prospectus entitled "Shareholder Services." Fund Exchanges. Shares of other funds purchased by exchange will be purchased on the basis of relative net asset value per share as follows: A. Exchanges for shares of funds that are offered without a sales load will be made without a sales load. B. Shares of funds purchased without a sales load may be exchanged for shares of other funds sold with a sales load, and the applicable sales load will be deducted. C. Shares of funds purchased with a sales load may be exchanged without a sales load for shares of other funds sold without a sales load. D. Shares of funds purchased with a sales load, shares of funds acquired by a previous exchange from shares purchased with a sales load, and additional shares acquired through reinvestment of dividends or distributions of any such funds (collectively referred to herein as "Purchased Shares") may be exchanged for shares of other funds sold with a sales load (referred to herein as "Offered Shares"), provided that, if the sales load applicable to the Offered Shares exceeds the maximum sales load that could have been imposed in connection with the Purchased Shares (at the time the Purchased Shares were acquired), without giving effect to any reduced loads, the difference will be deducted. To accomplish an exchange under Item D above, shareholders must notify the Transfer Agent of their prior ownership of fund shares and their account number. To request an exchange, an investor must give exchange instructions to the Transfer Agent in writing or by telephone. The ability to issue exchange instructions by telephone is given to all Fund shareholders automatically, unless the investor checks the applicable "No" box on the Account Application, indicating that the investor specifically refuses this privilege. By using the Telephone Exchange Privilege, the investor authorizes the Transfer Agent to act on telephonic instructions from any person representing himself or herself to be the investor, and believed by the Transfer Agent to be genuine. The Transfer Agent's records of such instructions are binding. Telephone exchanges may be subject to limitations as to amount involved or the number of telephone exchanges permitted. Shares issued in certificate form are not eligible for telephone exchanges. To establish a Personal Retirement Plan by exchange, shares of the fund being exchanged must have a value of at least the minimum initial investment required for the fund into which the exchange is being made. For Dreyfus-sponsored Keogh Plans and IRAs, including IRAs set up under a Simplified Employee Pension Plan ("SEP-IRAs"), with only one participant, the minimum initial investment is $750. To exchange shares held in Corporate Plans, 403(b)(7) Plans and SEP-IRAs with more than one participant, the minimum initial investment is $100 if the plan has at least $2,500 invested among the funds in the Dreyfus Family of Funds. To exchange shares held in Personal Retirement Plans, the shares exchanged must have a current value of at least $100. Dreyfus Auto-Exchange Privilege. The Dreyfus Auto-Exchange Privilege permits an investor to purchase, in exchange for shares of the Fund, shares of another fund in the Dreyfus Family of Funds. This Privilege is available only for existing accounts. Shares will be exchanged on the basis of relative net asset value as described above under "Fund Exchanges." Enrollment in or modification or cancellation of this Privilege is effective three business days following notification by the investor. Investors will be notified if their accounts fall below the amount designated to be exchanged under this Privilege. In this case, an investor's account will fall to zero unless additional investments are made in excess of the designated amount prior to the next Auto-Exchange transaction. Shares held under IRA and other retirement plans are eligible for this Privilege. Exchanges of IRA shares may be made between IRA accounts and from regular accounts to IRA accounts, but not from IRA accounts to regular accounts. With respect to all other retirement accounts, exchanges may be made only among those accounts. Fund Exchanges and Dreyfus Auto-Exchange Privilege are available to shareholders resident in any state in which the fund being acquired may legally be sold. Shares may be exchanged only between fund accounts having identical names and other identifying designations. Shareholder Services Forms and prospectuses of the other funds in the Dreyfus Family of Funds may be obtained by calling 1-800-645-6561. The Fund reserves the right to reject any exchange request. The Fund Exchange services or Dreyfus Auto-Exchange Privilege may be modified or terminated at any time upon notice to shareholders. Automatic Withdrawal Plan. The Automatic Withdrawal Plan permits an investor with a $5,000 minimum account to request withdrawal of a specified dollar amount (minimum of $50) on either a monthly or quarterly basis. Withdrawal payments are the proceeds from sales of Fund shares, not the yield on the shares. If withdrawal payments exceed reinvested dividends and distributions, the investor's shares will be reduced and eventually may be depleted. The Automatic Withdrawal Plan may be terminated at any time by the investor, the Fund or the Transfer Agent. Shares for which certificates have been issued may not be redeemed through the Automatic Withdrawal Plan. Dreyfus Dividend Sweep. Dreyfus Dividend Sweep allows investors to invest on payment date their dividends and any capital gains distributions from the Fund in shares of another fund in the Dreyfus Family of Funds of which the investor is a shareholder. Shares of other funds purchased pursuant to Dreyfus Dividend Sweep will be purchased on the basis of relative net asset value per share as follows: A. Dividends and distributions paid by a fund may be invested without imposition of the sales load in shares of other funds that are offered without a sales load. B. Dividends and distributions paid by a fund which does not charge a sales load may be invested in shares of other funds sold with a sales load, and the applicable sales load will be deducted. C. Dividends and distributions paid by a fund which charges a sales load may be invested in shares of other funds sold with a sales load (referred to herein as "Offered Shares"), provided that, if the sales load applicable to the Offered Shares exceeds the maximum sales load charged by the fund from which dividends or distributions are being swept, without giving effect to any reduced loads, the difference will be deducted. D. Dividends and distributions paid by a fund may be invested in shares of other funds that impose a contingent deferred sales charge ("CDSC") and the applicable CDSC, if any, will be imposed upon redemption of such shares. Dreyfus Payroll Savings Plan. The Dreyfus Payroll Savings Plan allows investors to purchase Fund shares (minimum of $100 per transaction) automatically on a regular basis. A Dreyfus Payroll Savings Plan account can only be established by filing an authorization form with your employer's payroll department, which must complete the reverse side of the form and return it to The Dreyfus Family of Funds, P.O. Box 9671, Providence, Rhode Island 02940-9671. You may obtain the necessary authorization form from the Distributor. 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 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. The entity acting as custodian for Keogh Plans, 403(b)(7) Plans or IRAs may charge a fee, payment of which could require the liquidation of shares. All fees charged are described in the appropriate form. Shares may be purchased in connection with these plans only by direct remittance to the entity acting 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 Bank Custodial Agreement for further details on 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 Shares." Valuation of Portfolio Securities. Portfolio securities, including warrants and covered call options written, are valued at the last sales price on the securities exchange on which the securities primarily are traded or at the last sales price on the national securities market. 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 recently reported bid and asked prices. Market quotations of foreign securities in foreign currencies are translated into U.S. dollars at the prevailing rates of exchange. Any securities or other assets for which market quotations are not readily available are valued at fair value as determined in good faith by the Board of Directors. The Fund's Board will review the method of valuation on a regular basis. In making their good faith valuation, the Board will generally take the following into consideration: restricted securities which are, or are convertible into, securities of the same class of securities for which a public market exists usually will be valued at market value less the same percentage discount at which purchased. This discount will be revised periodically by the Fund's Board if they believe that it no longer reflects the value of the restricted securities. Restricted securities not of the same class as securities for which a public market exists will usually be valued initially at cost. Any subsequent adjustments from cost will be based upon considerations deemed relevant by the Board of Directors. Expenses and fees, including the advisory fees, 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. 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, a wholly-owned subsidiary of the Manager, 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. A quarterly report of the amounts expended under the Plan, and the purposes for which such expenditures were incurred, must be made to the Directors for their review. In addition, the Plan provides that material amendments of the Plan must be approved by the Board of Directors, and by the Directors who are not "interested persons" (as defined in the 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 of the Directors cast in person at a meeting called for the purpose of voting on the Plan. The Plan is terminable at any time by vote of a majority of the Directors who are not "interested persons" and have no direct or indirect financial interest in the operation of the Plan. For the year ended May 31, 1996, $655,193 was charged to the Fund under the Plan. 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." Management believes that the Fund qualified for the fiscal year ended May 31, 1996 as a "regulated investment company" under the Internal Revenue Code of 1986, as amended (the "Code"). The Fund intends to continue to so qualify if such qualification is in the best interests of its shareholders. Qualification as a "regulated investment company" relieves the Fund of any liability for Federal income taxes to the extent its net investment income and net realized capital gains are distributed in accordance with applicable provisions of the Code. Among the requirements for such qualification is that less than 30% of the Fund's income be derived from gains from the sale or other disposition of securities held for less than three months, the Fund must distribute at least 90% of its net income (consisting of net investment income and net short-term capital gain) to its shareholders, and the Fund must meet certain asset diversification and other requirements. Accordingly, the Fund may be restricted in the selling of securities held for less than three months, and in the utilization of certain of the investment techniques described in the Prospectus. The Code's rules regarding the determination of the holding period of property comprising a straddle, however, should make it easier for the Fund to satisfy the 30% test. The term "regulated investment company" does not imply the supervision of management or investment practices or policies by any government agency. Any dividend or distribution paid shortly after an investor's purchase may have the effect of reducing the net asset value of the shares below the original cost of his investment. Such dividend or distribution would be a return on 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 such shorter period as the Internal Revenue Service may prescribe by regulations) and has received a capital gain dividend with respect to such shares, any loss incurred on the sale of such shares will be treated as long-term capital loss to the extent of the capital gain dividend received. Depending upon the composition of the Fund's income, the entire amount or a portion of the dividends from net investment income may qualify for the dividends received deduction allowable to qualifying U.S. corporate shareholders ("dividends received deduction"). In general, dividend income of the Fund distributed to its 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. However, Section 246(c) of the Code provides that if a qualifying corporate shareholder has disposed of Fund shares not held for more than 45 days and has received a dividend from net investment income with respect to such shares, the portion designated by the Fund as qualifying for the dividends received deduction will not be eligible for such shareholder's dividends received deduction. 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. Ordinarily, gains and losses realized from portfolio transactions will be treated as capital gain or loss. However, all or a portion of the gain or loss from the disposition of non-U.S. dollar denominated securities (including debt instruments, certain financial forward, futures and option contracts, and certain preferred stock) may be treated as ordinary income or loss under Section 988 of the Code. In addition, all or a portion of the gain realized from the disposition of certain market discount bonds will be treated as ordinary income under Section 1276. Finally, 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, any gain or loss realized by the Fund from certain options 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 or lapse of such options as well as from closing transactions. In addition, any such options 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 certain financial forward, futures or options contracts may be considered, for tax purposes, to constitute "straddles." "Straddles" are defined to include "offsetting positions" in personal property. The tax treatment of "straddles" is governed by Sections 1092 and 1258 of the Code, which, in certain circumstances, override or modify the provisions of Sections 988 and 1256. As such, all or a portion of any short or long-term capital gains from certain "straddle" transactions may be recharacterized as ordinary income. If the Fund were treated as entering into "straddles" by reason of its engaging in certain financial forward, futures or options contracts, such "straddles" could be characterized as "mixed straddles" if at least one (but not all) of the positions comprising such straddles are "Section 1256 contracts." A "Section 1256 contract" is defined to include any regulated futures contract, foreign currency contract, non-equity option, and dealer equity option. Section 1256(d) of the Code permits the Fund to elect not to have Section 1256 apply with respect to "mixed straddles." If no such election is made, to the extent the "straddle" 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" and the conversion transaction 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. PORTFOLIO TRANSACTIONS The Manager assumes 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 Manager and in a manner deemed fair and reasonable to shareholders, rather than by any formula. The primary consideration in all portfolio securities transactions is prompt execution of orders at the most favorable net price. When this primary consideration is met to the satisfaction of the Manager, brokers may also be selected because of their ability to handle special executions such as are involved in large block trades or broad distributions. Large block trades may, in certain cases, result from two or more funds advised or administered by the Manager being engaged simultaneously in the purchase or sale of the same security. Subject to the primary consideration, particular brokers selected may also include those who supplement the Manager's and NCM's research facilities with statistical data, investment information, economic facts and opinions; sales of Fund shares by a broker may be taken into consideration. Information so received is in addition to and not in lieu of services required to be performed by the Manager and NCM and their fees are not reduced as a consequence of the receipt of such supplemental information. Such information may be useful to the Manager in serving both the Fund and other funds which it advises and to NCM in serving both the Fund and the other accounts it manages, and, conversely, supplemental information obtained by the placement of business of other clients may be useful to the Manager and NCM in carrying out their obligations to the Fund. The overall reasonableness of brokerage commissions paid is evaluated by the Manager based upon its knowledge of available information as to the general level of commissions paid by other institutional investors for comparable services. When transactions are executed in the over-the-counter market, the Fund will deal with the primary market makers unless a more favorable price or execution is otherwise obtainable. Although it is not possible to place a dollar value on the research services received from brokers who effect transactions in portfolio securities, it is the opinion of the Manager that these services should not reduce the overall expenses of its research department. For its portfolio securities transactions for the fiscal years ended May 31, 1994, 1995 and 1996, the Fund paid total brokerage commissions of $983,514, $1,445,266 and $777,679, respectively, none of which was paid to the Distributor. The above figures for brokerage commissions paid do not include gross spreads and concessions on principal transactions which, where determinable, amounted to $662,268, $0 and $0 in fiscal years 1994, 1995 and 1996, respectively, none of which was paid to the Distributor. The Fund's portfolio turnover rates (exclusive of U.S. Government securities and short-term investments) for the fiscal years ended May 31, 1995 and 1996 were 133.54% and 92.08%, respectively. 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 one, five and ten year periods ended May 31, 1996 was 33.63%, 11.16% and 11.96%, 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 March 29, 1972 to May 31, 1996 was 1,538.41%. 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. From time to time, advertising material for the Fund may include biographical information relating to its portfolio managers and may refer to, or include commentary by the portfolio manager relating to investment strategy, asset growth, current or past business, political, economic, or financial conditions and other matters of general interest to investors. It may also discuss or portray the principles of dollar-cost-averaging and may refer to Morningstar or Value Line ratings and related analyses supporting the 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 share has one vote and, when issued and paid for in accordance with the terms of the offering, is fully paid and non-assessable. Shares of stock are of one class and have equal rights as to voting, redemption, dividends, and in liquidation. Shares have no preemptive, subscription or conversion rights and are freely transferable. The Fund sends annual and semi-annual financial statements to all its shareholders. CUSTODIAN, TRANSFER AND DIVIDEND DISBURSING AGENT, COUNSEL AND INDEPENDENT AUDITORS Mellon Bank, N.A. (the "Custodian"), Dreyfus' parent and a subsidiary of Mellon Bank Corporation, is located at One Mellon Bank Center, Pittsburgh, Pennsylvania 15258, 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. Dreyfus Transfer, Inc., a wholly-owned subsidiary of Dreyfus, P.O. Box 9671, Providence, Rhode Island 02940-9671, is the Fund's transfer and dividend disbursing agent. Under a transfer agency agreement with the Fund, the Transfer Agent arranges for the maintenance of shareholder account records for the Fund, the handling of certain communications between shareholders and the Fund and the payment of dividends and distributions payable by the Fund. For these services, the Transfer Agent receives a monthly fee computed on the basis of the number of shareholder accounts it maintains for the Fund during the month, and is reimbursed for certain out-of-pocket expenses. For the period December 1, 1995 (effective date of Transfer Agency Agreement) through May 31, 1996, the Fund paid the Transfer Agent $128.102. 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. Fulbright & Jaworski L.L.P., 666 Fifth Avenue, New York, New York 10103, as counsel for the Fund, has rendered its opinion as to certain legal matters in connection with the shares of capital stock being sold pursuant to the Fund's Prospectus to which this Statement of Additional Information relates. Ernst & Young LLP, independent auditors, 787 Seventh Avenue, New York, New York 10019 have been selected as auditors of the Fund.
THE DREYFUS THIRD CENTURY FUND, INC. STATEMENT OF INVESTMENTS MAY 31, 1996 COMMON STOCKS-98.3% SHARES VALUE _______ _______ COMMERCIAL SERVICES-2.3%..... Grainger (W.W.) 55,700 $ 3,724,938 ...................................Sysco 212,000 7,234,500 _______ 10,959,438 _______ CONSUMER DURABLES-1.9%..... Briggs & Stratton 104,500 4,493,500 Oakwood Homes.......................... 95,000 4,607,500 _______ 9,101,000 _______ CONSUMER NON-DURABLES-14.1%......... CPC International 80,000 5,530,000 Campbell Soup.......................... 142,500 9,191,250 Coca-Cola.............................. 229,800 10,570,800 Gillette............................... 141,600 8,372,100 Jones Apparel Group.................. (a) 130,000 6,630,000 NIKE, Cl. B............................ 80,800 8,110,300 PepsiCo................................ 297,000 9,875,250 Tambrands.............................. 180,000 8,302,500 _______ 66,582,200 _______ CONSUMER SERVICES-6.3%... BET Holdings, Cl. A (a) 73,900 1,967,588 CUC International.................... (a) 225,700 8,350,900 Disney (Walt).......................... 133,600 8,116,200 Regal Cinemas........................ (a) 60,000 2,782,500 Service Corp. International............ 150,000 8,381,250 _______ 29,598,438 _______ ELECTRONIC TECHNOLOGY-13.0% Applied Materials (a) 207,000 7,710,750 Atmel............................ (a) 60,000 2,130,000 Coherent............................. (a) 58,400 2,854,300 ....EMC (a) 514,100 11,374,463 Hewlett-Packard........................ 95,200 10,162,600 Linear Technology...................... 194,400 6,706,800 Sun Microsystems..................... (a) 168,600 10,558,575 ....3COM (a) 206,300 10,160,275 _______ 61,657,763 _______ FINANCE-15.2%..................... AFLAC 171,150 5,155,894 Allstate............................... 163,070 6,889,707 American International Group........... 74,700 7,040,475 BankAmerica............................ 175,000 13,168,750 Citicorp............................... 99,200 8,332,800 Federal National Mortgage Association.. 310,600 9,589,775 Green Tree Financial................... 266,800 8,737,700 MGIC Investment........................ 75,000 4,406,250 SunAmerica............................. 150,000 8,400,000 _______ 71,721,351 _______ THE DREYFUS THIRD CENTURY FUND, INC. STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1996 COMMON STOCKS (CONTINUED) SHARES VALUE _______ _______ HEALTH SERVICES-1.1%...... HealthCare COMPARE (a) 105,000 $ 5,079,375 _______ HEALTH TECHNOLOGY-14.3%............Amgen (a) 135,600 8,068,200 Becton, Dickinson & Co. ............... 85,400 7,259,000 Bristol-Myers Squibb................... 103,500 8,836,313 Chiron............................... (a) 50,000 5,250,000 Guidant................................ 100,000 5,800,000 Johnson & Johnson...................... 99,540 9,692,707 Medtronic.............................. 169,600 9,540,000 Merck & Co. ........................... 146,762 9,484,494 Neopath.............................. (a) 97,700 2,515,775 Neurogen............................. (a) 40,000 1,170,000 _______ 67,616,489 _______ INDUSTRIAL SERVICES-.7%......... Schlumberger 42,210 3,519,259 _______ PROCESS INDUSTRIES-5.3%....... Avery Dennison 100,000 5,700,000 ....Bemis 300,600 9,957,375 Sigma-Aldrich.......................... 170,900 9,570,400 _______ 25,227,775 _______ PRODUCER MANUFACTURING-3.6%...............Dover 125,800 5,975,500 Harnischfeger Industries............... 160,000 5,600,000 Philips Electronics, N.V. ............. 158,500 5,567,313 _______ 17,142,813 _______ RETAIL TRADE-2.6%........ Consolidated Stores (a) 113,000 4,279,875 Sears, Roebuck & Co. .................. 158,700 8,073,862 _______ 12,353,737 _______ TECHNOLOGY SERVICES-10.3%.. Arrow Electronics (a) 191,500 9,431,375 BMC Software......................... (a) 148,560 9,359,280 Computer Associates International.............. 128,950 9,381,113 Ericsson (LM) Telephone, Cl. B, A.D.R......... 195,000 4,497,187 Microsoft............................ (a) 48,000 5,700,000 ....Oracle (a) 310,500 10,285,312 _______ 48,654,267 _______ TRANSPORTATION-3.0%.......... Comair Holdings 127,500 3,346,875 Delta Air Lines........................ 56,000 4,641,000 Federal Express...................... (a) 82,820 6,346,082 _______ 14,333,957 _______ UTILITIES-4.6%.................... CMS Energy 75,000 2,156,250 Century Telephone Enterprises.................. 261,900 8,511,750 ....GTE 153,430 6,559,132 THE DREYFUS THIRD CENTURY FUND, INC. STATEMENT OF INVESTMENTS (CONTINUED) MAY 31, 1996 COMMON STOCKS (CONTINUED) SHARES VALUE _______ _______ UTILITIES (CONTINUED)..... 360 Communications 200,000 $ 4,625,000 _______ 21,852,132 _______ TOTAL COMMON STOCKS (cost $361,774,796).................. $465,399,994 ======= PRINCIPAL SHORT-TERM INVESTMENT-.1% AMOUNT _______ U.S. TREASURY BILL;.......... 4.98%, 8/8/1996 (cost $340,764)...................... $.......344,000 $ 340,743 ======= TOTAL INVESTMENTS (cost $362,115,560)....................................... 98.4% $465,740,737 ==== ======= CASH AND RECEIVABLES (NET).................................................. 1.6% $ 7,711,406 ==== ======= NET ASSETS.................................................................. 100.0% $473,452,143 ==== ======= NOTE TO STATEMENT OF INVESTMENTS; (a) Non-income producing. See notes to financial statements.
THE DREYFUS THIRD CENTURY FUND, INC. STATEMENT OF ASSETS AND LIABILITIES MAY 31, 1996 ASSETS: Investments in securities, at value (cost $362,115,560)-see statement..................................... $465,740,737 Cash.................................................................... 903,182 Receivable for investment securities sold............................... 7,195,281 Dividends receivable.................................................... 489,962 Receivable for subscriptions to Common Stock............................ 62,778 Prepaid expenses........................................................ 62,720 _______ 474,454,660 LIABILITIES: Due to The Dreyfus Corporation and subsidiaries......................... $329,540 Payable for investment securities purchased............................. 324,482 Payable for Common Stock redeemed....................................... 32,718 Accrued expenses........................................................ 315,777 1,002,517 ____ _______ NET ASSETS.................................................................. $473,452,143 ======= REPRESENTED BY: Paid-in capital......................................................... $329,978,345 Accumulated undistributed investment income-net......................... 773,541 Accumulated undistributed net realized gain on investments.............. 39,075,080 Accumulated net unrealized appreciation on investments-Note 4........... 103,625,177 _______ NET ASSETS at value applicable to 51,201,638 shares outstanding (150 million shares of $.331/3 par value Common Stock authorized)....... $473,452,143 ======= NET ASSET VALUE, offering and redemption price per share ($473,452,143 / 51,201,638 shares)...................................... $9.25 ======= See notes to financial statements.
THE DREYFUS THIRD CENTURY FUND, INC. STATEMENT OF OPERATIONS YEAR ENDED MAY 31, 1996 INVESTMENT INCOME: INCOME: Cash dividends (net of $78,787 foreign taxes withheld at source)...... $ 5,248,818 Interest.............................................................. 904,332 ______ TOTAL INCOME.................................................... $ 6,153,150 EXPENSES: Investment advisory fee-Note 3(a)..................................... 3,154,864 Shareholder servicing costs-Note 3(b)................................. 1,192,986 Professional fees..................................................... 89,450 Directors' fees and expenses-Note 3(c)................................ 54,327 Prospectus and shareholders' reports.................................. 51,648 Custodian fees-Note 3(b).............................................. 50,005 Registration fees..................................................... 31,646 Miscellaneous......................................................... 21,062 ______ TOTAL EXPENSES.................................................. 4,645,988 _______ INVESTMENT INCOME-NET........................................... 1,507,162 REALIZED AND UNREALIZED GAIN ON INVESTMENTS: Net realized gain on investments-Note 4................................. $62,835,662 Net unrealized appreciation on investments.............................. 54,728,281 ______ NET REALIZED AND UNREALIZED GAIN ON INVESTMENTS................. 117,563,943 _______ NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS........................ $119,071,105 ======= See notes to financial statements.
THE DREYFUS THIRD CENTURY FUND, INC. STATEMENT OF CHANGES IN NET ASSETS YEAR ENDED MAY 31, __________________________________ 1995 1996 _______ ______ OPERATIONS: Investment income-net................................................... $ 3,346,699 $ 1,507,162 Net realized gain on investments........................................ 12,839,259 62,835,662 Net unrealized appreciation on investments for the year................. 22,739,756 54,728,281 _______ ______ NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS.................. 38,925,714 119,071,105 _______ ______ DIVIDENDS TO SHAREHOLDERS FROM: Investment income-net................................................... (2,986,999) (2,113,842) Net realized gain on investments........................................ (46,183,615) (27,118,179) _______ ______ TOTAL DIVIDENDS....................................................... (49,170,614) (29,232,021) _______ ______ CAPITAL STOCK TRANSACTIONS: Net proceeds from shares sold........................................... 68,296,100 347,500,025 Dividends reinvested.................................................... 47,326,617 27,798,267 Cost of shares redeemed................................................. (126,884,560) (360,518,670) _______ ______ INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL STOCK TRANSACTIONS..... (11,261,843) 14,779,622 _______ ______ TOTAL INCREASE (DECREASE) IN NET ASSETS........................... (21,506,743) 104,618,706 NET ASSETS: Beginning of year....................................................... 390,340,180 368,833,437 _______ ______ End of year (including undistributed investment income-net: $1,380,221 in 1995 and $773,541 in 1996).............................. $ 368,833,437 $ 473,452,143 ======= ====== SHARES SHARES _______ ______ CAPITAL SHARE TRANSACTIONS: Shares sold............................................................. 9,474,361 40,415,926 Shares issued for dividends reinvested.................................. 7,548,119 3,419,227 Shares redeemed......................................................... (17,546,982) (42,120,754) _______ ______ NET INCREASE (DECREASE) IN SHARES OUTSTANDING......................... (524,502) 1,714,399 ======= ====== See notes to financial statements.
THE DREYFUS THIRD CENTURY FUND, INC. FINANCIAL HIGHLIGHTS Refernece is made to page 3 of the Fund's Prospectus dated October 1, 1996. THE DREYFUS THIRD CENTURY FUND, INC. NOTES TO FINANCIAL STATEMENTS NOTE 1-SIGNIFICANT ACCOUNTING POLICIES: The Dreyfus Third Century Fund, Inc. (the "Fund") is registered under the Investment Company Act of 1940 ("Act") as a diversified open-end management investment company. The Fund's investment objective is to provide capital growth. The Dreyfus Corporation ("Dreyfus") serves as the Fund's investment adviser. Dreyfus is a direct subsidiary of Mellon Bank, N.A. ("Mellon"). NCM Capital Management Group, Inc. ("NCM") serves as the Fund's sub-investment adviser. Premier Mutual Fund Services, Inc. (the "Distributor") acts as the distributor of the Fund's shares which are sold to the public without a sales charge. (A) PORTFOLIO VALUATION: Investments in securities 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. Securities for which there are no such valuations are valued at fair value as determined in good faith under the direction of the Board of Directors. (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. (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-BANK LINE OF CREDIT: The Fund participates in a $100 million unsecured line of credit provided by The Bank of New York, primarily for temporary or emergency purposes, including the meeting of redemption requests that otherwise might require the untimely disposition of securities. Interest is payable at the Federal Funds rate plus .50% on an annualized basis. During the year ended May 31, 1996, the amounts borrowed from this line of credit were immaterial. NOTE 3-INVESTMENT ADVISORY FEE, SUB-INVESTMENT ADVISORY FEE AND OTHER TRANSACT IONS WITH AFFILIATES: (A) Pursuant to the management agreement ("Agreement") with Dreyfus, the management fee is computed at an annual rate of .75 of 1% of the value of the Fund's average daily net assets and is payable monthly. The agreement provides for an expense reimbursement from the Manager should the Fund's aggregate expenses, exclusive of taxes, brokerage, interest on borrowings and extraordinary THE DREYFUS THIRD CENTURY FUND, INC. NOTES TO FINANCIAL STATEMENTS expenses, exceed 11\2% of the value of the Fund's average daily net assets for any full fiscal year. There was no expense reimbursement for the year ended May 31, 1996. Pursuant to a Sub-Investment Advisory Agreement with NCM, the sub-investment advisory fees are payable monthly by Dreyfus, and are based upon the value of the Fund's average daily net assets, computed at the following rates:
AVERAGE NET ASSETS ____________ 0 to $400 million..................................................................... .10 of 1% $400 to $500 million.................................................................. .15 of 1% $500 to $750 million.................................................................. .20 of 1% In excess of $750 million............................................................. .25 of 1%
Prior to April 18, 1996, the sub-investment advisory fee was computed at an annual rate of .10 of 1% on the first $500 million and .20 of 1% on the excess over $500 million of the value of the Fund's average daily net assets and was payable monthly by Dreyfus. (B) Pursuant to the Fund's Shareholder Services Plan, 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. During the year ended May 31, 1996, the Fund was charged an aggregate of $655,193 pursuant to the Shareholder Services Plan. Effective December 1, 1995, the Fund compensates Dreyfus Transfer, Inc., a wholly-owned subsidiary of Dreyfus, under a transfer agency agreement for providing personnel and facilities to perform transfer agency services for the Fund. Such compensation amounted to $128,102 for the period from December 1, 1995 through May 31, 1996. Effective May 10, 1996, the Fund entered into a Custody Agreement with Mellon to provide custodial services for the Fund. For the period from May 10, 1996 through May 31, 1996, $4,606 was paid to Mellon pursuant to the Custody Agreement. (C) Each director who is not an "affiliated person" as defined in the Act receives from the Fund an annual fee of $10,000. The Chairman of the Board receives an additional 25% of such compensation. NOTE 4-SECURITIES TRANSACTIONS: The aggregate amount of purchases and sales of investment securities, excluding short-term securities, during the year ended May 31, 1996 amounted to $378,938,523 and $369,914,313, respectively. At May 31, 1996, accumulated net unrealized appreciation on investments was $103,625,177, consisting of $107,429,785 gross unrealized appreciation and $3,804,608 gross unrealized depreciation. At May 31, 1996, 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). THE DREYFUS THIRD CENTURY FUND, INC. REPORT OF ERNST & YOUNG LLP, INDEPENDENT AUDITORS SHAREHOLDERS AND BOARD OF DIRECTORS THE DREYFUS THIRD CENTURY FUND, INC. We have audited the accompanying statement of assets and liabilities of The Dreyfus Third Century Fund, Inc., including the statement of investments, as of May 31, 1996, 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 May 31, 1996 and confirm ation of securities not held by the custodian by correspondence with others. 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 The Dreyfus Third Century Fund, Inc. at May 31, 1996, the results of its operations for the year then ended, the changes in its net assets for each of the two years in the period then ended, and the financial highlights for each of the indicated years, in conformity with generally accepted accounting principles. [Ernst and Young LLP signature logo] New York, New York July 9, 1996 THE DREYFUS THIRD CENTURY 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 each of the ten years in the period ended May 31, 1996. Included in Part B of the Registration Statement: Statement of Investments--May 31, 1996. Statement of Assets and Liabilities--May 31, 1996. Statement of Operations--year ended May 31, 1996. Statement of Changes in Net Assets--for each of the years ended May 31, 1995 and 1996. Notes to Financial Statements Report of Ernst & Young LLP, Independent Auditors, dated July 9, 1996. Schedules No. I through VII and other financial statement information, for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission, are either omitted because they are not required under the related instructions, they are inapplicable, or the required information is presented in the financial statements or notes thereto which are included in Part B of the Registration Statement. Item 24. Financial Statements and Exhibits. - List (continued) _______ _____________________________________________________ (b) Exhibits: (1) Registrant's Articles of Incorporation in the State of Maryland are incorporated by reference to Exhibit (1) of Post-Effective Amendment No. 21 to the Registration Statement on Form N-1A, filed on July 30, 1982 ("Post-Effective Amendment No. 21"). (2) Registrant's By-Laws, as amended, are incorporated by reference to Exhibit (2) of Post-Effective Amendment No. 32 to the Registration Statement on Form N-1A, filed on July 6, 1990. (4) Specimen certificate for the Registrant's securities is incorporated by reference to Exhibit (4) of Post-Effective Amendment No. 21. (5)(a) Management Agreement is incorporated by reference to exhibit 5(a) of Post-Effective Amendment No. 38 to the Registration Statement on Form N-1A, filed on September 16, 1994. (b) Amended and Restated Sub-Investment Advisory Agreement. (6) Distribution Agreement is incorporated by reference to exhibit 6 of the Post-Effective Amendment No.38 to the Registration Statement on Form N-1A, filed on September 16, 1994. (8)(a) Custody Agreement. (8)(b) Sub-Custodian Agreements are incorporated by reference to Exhibit 8(b) of Post-Effective Amendment No. 21, and to Exhibit 8(c) of Post-Effective Amendment No. 32 to the Registration Statement on Form N-1A, filed on July 6, 1990. (9) Shareholder Services Plan is incorporated by reference to exhibit 9 of Post-Effective Amendment No. 38 to the Registration Statement on Form N-1A, filed on September 16, 1994. (10) Opinion and consent of Registrant's counsel is incorporated by reference to Exhibit (3) of Post-Effective Amendment No. 1 to the Registration Statement on Form S-5, filed on March 29, 1972. (11) Consent of Independent Auditors. (14) The documents making up model plans in the establishment of retirement plans in conjunction with which Registrant offers its securities is incorporated by reference to Exhibit (14) of Post- Effective Amendment No. 16 to the Registration Statement on Form N-1A, filed on August 24, 1979. (16) Schedules of Computation of Performance Data is incorporated by reference to exhibit 16 of Post-Effective Amendment No. 38 to the Registration Statement in Form N-1A, filed on September 16, 1994. Item 24. Financial Statements and Exhibits. - List (continued) _______ _____________________________________________________ Other Exhibits ______________ (a) Power of Attorney of the Directors and officers are incorporated by reference to Other Exhibits (a) of Post- Effect Amendment No. 38 to the Registration Statement on Form N-1A, filed on September 16, 1994. (b) Certificate of Assistant Secretary is incorporated by reference to Other Exhibits (b) of Post-Effective Amendment No. 38 to the Registration Statement on Form N-1A, filed on September 16, 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 July 15, 1996 ______________ _____________________________ Common Stock 22,784 (Par value $.33 1/3) Item 27. Indemnification _______ _______________ The Statement as to the general effect of any contract, arrangements or statute under which a director, officer, underwriter or affiliated person of the Registrant is insured or indemnified in any manner against any liability which may be incurred in such capacity, other than insurance provided by any director, officer, affiliated person or underwriter for their own protection, is incorporated by reference to Item 4 of Part II of Post-Effective Amendment No. 21 to the Registration Statement on From N-1A, filed on July 30, 1982. Reference is also made to the Distribution Agreement attached as Exhibit (6) of Post-Effective Amendment No. 22 to the Registration Statement on Form N-1A, filed on September 30, 1983. Item 28. Business and Other Connections of Investment Adviser. _______ ____________________________________________________ The Dreyfus Corporation ("Dreyfus") and subsidiary companies comprise a financial service organization whose business consists primarily of providing investment management services as the investment adviser and manager for sponsored investment companies registered under the Investment Company Act of 1940 and as an investment adviser to institutional and individual accounts. Dreyfus also serves as sub-investment adviser to and/or administrator of other investment companies. Dreyfus Service Corporation, a wholly-owned subsidiary of Dreyfus, provides shareholder servicing for 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. Business and Other Connections of Investment Adviser (continued) ________ ________________________________________________________________ Officers and Directors of Investment Adviser ____________________________________________ Name and Position with Dreyfus Other Businesses _________________ ________________ MANDELL L. BERMAN Real estate consultant and private investor Director 29100 Northwestern Highway, Suite 370 Southfield, Michigan 48034; Past Chairman of the Board of Trustees: Skillman Foundation; Member of The Board of Vintners Intl. FRANK V. CAHOUET Chairman of the Board, President and Director Chief Executive Officer: Mellon Bank Corporation****; Mellon Bank, N.A.**** Director: Avery Dennison Corporation 150 North Orange Grove Boulevard Pasadena, California 91103; Saint-Gobain Corporation 750 East Swedesford Road Valley Forge, Pennsylvania 19482; Teledyne, Inc. 1901 Avenue of the Stars Los Angeles, California 90067 ALVIN E. FRIEDMAN Senior Adviser to Dillon, Read & Co. Inc. Director 535 Madison Avenue New York, New York 10022; Director and Member of the Executive Committee of Avnet, Inc.** LAWRENCE M. GREENE Director: Director Dreyfus America Fund JULIAN M. SMERLING None Director HOWARD STEIN Chairman of the Board: Chairman of the Board and Dreyfus Acquisition Corporation*; Chief Executive Officer The Dreyfus Consumer Credit Corporation*; Dreyfus Management, Inc.*; Dreyfus Service Corporation*; Chairman of the Board and Chief Executive Officer: Major Trading Corporation*; Director: Avnet, Inc.**; Dreyfus America Fund++++; The Dreyfus Fund International Limited+++++; World Balanced Fund+++; Dreyfus Partnership Management, Inc.*; Dreyfus Personal Management, Inc.*; Dreyfus Precious Metals, Inc.*; Dreyfus Service Organization, Inc.***; Seven Six Seven Agency, Inc.*; Trustee: Corporate Property Investors New York, New York W. KEITH SMITH Chairman and Chief Executive Officer: Vice Chairman of the Board The Boston Company*****; Vice Chairman of the Board: Mellon Bank Corporation****; Mellon Bank, N.A.****; Director: Dentsply International, Inc. 570 West College Avenue York, Pennsylvania 17405 CHRISTOPHER M. CONDRON Vice Chairman: President, Chief Mellon Bank Corporation****; Operating Officer The Boston Company*****; and a Director Deputy Director: Mellon Trust****; Chief Executive Officer: The Boston Company Asset Management, Inc.*****; President: Boston Safe Deposit and Trust Company***** STEPHEN E. CANTER Director: Vice Chairman and The Dreyfus Trust Company++; Chief Investment Officer, Formerly, Chairman and Chief Executive and a Director Officer: Kleinwort Benson Investment Management Americas Inc.* LAWRENCE S. KASH Chairman, President and Chief Vice Chairman-Distribution Executive Officer: and a Director The Boston Company Advisors, Inc. 53 State Street Exchange Place Boston, Massachusetts 02109 Executive Vice President and Director: Dreyfus Service Organization, Inc.***; Director: The Dreyfus Consumer Credit Corporation*; The Dreyfus Trust Company++; Dreyfus Service Corporation*; President: The Boston Company*****; Laurel Capital Advisors****; Boston Group Holdings, Inc.; Executive Vice President: Mellon Bank, N.A.****; Boston Safe Deposit and Trust Company*****; PHILIP L. TOIA Chairman of the Board and Trust Investment Vice Chairman-Operations Officer: and Administration The Dreyfus Trust Company++; and a Director Chairman of the Board and Chief Operating Officer: Major Trading Corporation*; Chairman and Director: Dreyfus Transfer, Inc. One American Express Plaza Providence, Rhode Island 02903 Director: Dreyfus Precious Metals, Inc.*; Dreyfus Service Corporation*; Seven Six Seven Agency, Inc.*; President and Director: Dreyfus Acquisition Corporation*; The Dreyfus Consumer Credit Corporation*; Dreyfus-Lincoln, Inc.*; Dreyfus Management, Inc.*; Dreyfus Personal Management, Inc.*; Dreyfus Partnership Management, Inc.+; Dreyfus Service Organization, Inc.***; The Truepenny Corporation*; Formerly, Senior Vice President: The Chase Manhattan Bank, N.A. and The Chase Manhattan Capital Markets Corporation One Chase Manhattan Plaza New York, New York 10081 WILLIAM T. SANDALLS, JR. Director: Senior Vice President and Dreyfus Partnership Management, Inc.*; Chief Financial Officer Seven Six Seven Agency, Inc.*; President and Director: Lion Management, Inc.*; Executive Vice President and Director: Dreyfus Service Organization, Inc.*; Vice President, Chief Financial Officer and Director: Dreyfus Acquisition Corporation*; Vice President and Director: The Dreyfus Consumer Credit Corporation*; The Truepenny Corporation*; Treasurer, Financial Officer and Director: The Dreyfus Trust Company++; Treasurer and Director: Dreyfus Management, Inc.*; Dreyfus Personal Management, Inc.*; Dreyfus Service Corporation*; Major Trading Corporation*; Formerly, President and Director: Sandalls & Co., Inc. ELIE M. GENADRY President: Vice President- Institutional Services Division of Institutional Sales Dreyfus 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++ WILLIAM F. GLAVIN, JR. Executive Vice President: Vice President-Corporate Dreyfus Service Corporation*; Development Senior Vice President: The Boston Company Advisors, Inc. 53 State Street Exchange Place Boston, Massachusetts 02109 MARK N. JACOBS Vice President, Secretary and Director: Vice President- Lion Management, Inc.*; General Counsel Secretary: and Secretary The Dreyfus Consumer Credit Corporation*; Dreyfus Management, Inc.*; Assistant Secretary: Dreyfus Service Organization, Inc.***; Major Trading Corporation*; The Truepenny Corporation* PATRICE M. KOZLOWSKI None Vice President- Corporate Communications MARY BETH LEIBIG None Vice President- Human Resources JEFFREY N. NACHMAN President and Director: Vice President-Mutual Fund Dreyfus Transfer, Inc. Accounting One American Express Plaza Providence, Rhode Island 02903 ANDREW S. WASSER Vice President: Vice President-Information Mellon Bank Corporation**** Services 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. Business and Other Connections of Investment Adviser (continued) (b) Sub-Investment Adviser - NCM Capital Management Group, Inc.: NCM Capital Management Group, Inc. ("NCM"), a privately held corporation with principal place of business at 103 West Main Street, Durham, North Carolina 27705, is a registered investment adviser under the Investment Advisers Act of 1940. The business of NCM consists primarily of providing investment counselling services to institutional investors. Officers and Directors of Sub-Investment Adviser Name and Position with NCM Other Businesses MACEO K. SLOAN Chairman, President and Chief Executive Chairman, President and Officer: Chief Executive Officer Sloan Financial Group, Inc. 103 West Main Street Durham, North Carolina 27705; Chairman: New Africa Advisers, Inc. 103 West Main Street Durham, North Carolina 27705; Director: National Association of Securities Professionals; Mechanics and Farmers Bank Durham, North Carolina; North Carolina Air Cargo Airport Authority Raleigh, North Carolina; News and Observer Publishing Company 103 West Main Street Durham, North Carolina 27705; Trustee: College Retirement Equities Fund 730 Third Avenue New York, NY 10017; JUSTIN F. BECKETT President and Chief Executive Officer: Executive Vice President New Africa Advisers and Director 103 West Main Street Durham, North Carolina 27705; Director: African News Service 103 West Main Street Durham, North Carolina 27705; Trustee: Elizabeth State University Elizabeth City, North Carolina; PETER J. ANDERSON Chairman and Chief Investment Officer: Director IDS Advisory Group, Inc. IDS Tower 10 Minneapolis, MN 55440; PETER J. ANDERSON Director and Senior Vice President-Investments: (Cont'd) IDS Financial Services Inc. IDS Tower 10 Minneapolis, MN 55440; Director: Fairview-Southdale Hospital 6401 France Avenue South Edina, MN 55435; MORRIS GOODWIN, JR. Director and Treasurer: Director IDS Financial Corporation IDS Tower 10 Minneapolis, MN 55440; Metropolitan Economic Development Association 2021 East Hennepin Avenue Minneapolis, MN 55413; Director: American Express Minnesota Foundation 200 Vesey Street New York, NY 10285; Minnesota Orchestral Association 1111 Nicollet Mall Minneapolis, MN 55403; Minnesota Chamber of Commerce 30 East 7th Street St. Paul, MN 55101; EDITH H. NOEL None Senior Vice President, Corporate Secretary and Treasurer DENNIS M. MCCASKILL, JR. None Senior Vice President CLIFFORD D. MPARE, JR. None Senior Vice President- Investments DAVID C. CARTER None Vice President MARY M. FORD None Vice President STEPHON A. JACKSON None Vice President STANLEY G. LABORDE None Vice President LINDA JORDAN None Vice President VICTOR ROSS None Vice President Former Principal: Sentra Securities San Diego, CA; Former Trustee: San Diego City Employees Retirement System San Diego, California; WENDELL MACKEY None Vice President LORENZO NEWSOME None Vice President LAWRENCE VERNY None Vice President DEBORAH C. BRONSON None Vice President - Director of Operations TERRENCE S. LASTER None Assistant Vice President MARC REID None Assistant Vice President- Manager of Marketing and Client Services 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 Florida Intermediate Municipal Bond Fund 19) Dreyfus Florida Municipal Money Market Fund 20) The Dreyfus Fund Incorporated 21) Dreyfus Global Bond Fund, Inc. 22) Dreyfus Global Growth Fund 23) Dreyfus GNMA Fund, Inc. 24) Dreyfus Government Cash Management 25) Dreyfus Growth and Income Fund, Inc. 26) Dreyfus Growth and Value Funds, Inc. 27) Dreyfus Growth Opportunity Fund, Inc. 28) Dreyfus Income Funds 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) Dreyfus Stock Index Fund, Inc. 38) Dreyfus LifeTime Portfolios, Inc. 39) Dreyfus Liquid Assets, Inc. 40) Dreyfus Massachusetts Intermediate Municipal Bond Fund 41) Dreyfus Massachusetts Municipal Money Market Fund 42) Dreyfus Massachusetts Tax Exempt Bond Fund 43) Dreyfus Michigan Municipal Money Market Fund, Inc. 44) Dreyfus MidCap Index Fund 45) Dreyfus Money Market Instruments, Inc. 46) Dreyfus Municipal Bond Fund, Inc. 47) Dreyfus Municipal Cash Management Plus 48) Dreyfus Municipal Money Market Fund, Inc. 49) Dreyfus New Jersey Intermediate Municipal Bond Fund 50) Dreyfus New Jersey Municipal Bond Fund, Inc. 51) Dreyfus New Jersey Municipal Money Market Fund, Inc. 52) Dreyfus New Leaders Fund, Inc. 53) Dreyfus New York Insured Tax Exempt Bond Fund 54) Dreyfus New York Municipal Cash Management 55) Dreyfus New York Tax Exempt Bond Fund, Inc. 56) Dreyfus New York Tax Exempt Intermediate Bond Fund 57) Dreyfus New York Tax Exempt Money Market Fund 58) Dreyfus Ohio Municipal Money Market Fund, Inc. 59) Dreyfus 100% U.S. Treasury Intermediate Term Fund 60) Dreyfus 100% U.S. Treasury Long Term Fund 61) Dreyfus 100% U.S. Treasury Money Market Fund 62) Dreyfus 100% U.S. Treasury Short Term Fund 63) Dreyfus Pennsylvania Intermediate Municipal Bond Fund 64) Dreyfus Pennsylvania Municipal Money Market Fund 65) Dreyfus Short-Intermediate Government Fund 66) Dreyfus Short-Intermediate Municipal Bond Fund 67) Dreyfus Investment Grade Bond Funds, Inc. 68) The Dreyfus Socially Responsible Growth Fund, Inc. 69) Dreyfus Tax Exempt Cash Management 70) The Dreyfus Third Century Fund, Inc. 71) Dreyfus Treasury Cash Management 72) Dreyfus Treasury Prime Cash Management 73) Dreyfus Variable Investment Fund 74) Dreyfus Worldwide Dollar Money Market Fund, Inc. 75) General California Municipal Bond Fund, Inc. 76) General California Municipal Money Market Fund 77) General Government Securities Money Market Fund, Inc. 78) General Money Market Fund, Inc. 79) General Municipal Bond Fund, Inc. 80) General Municipal Money Market Fund, Inc. 81) General New York Municipal Bond Fund, Inc. 82) General New York Municipal Money Market Fund 83) Dreyfus S&P 500 Index Fund 84) Premier Insured Municipal Bond Fund 85) Premier California Municipal Bond Fund 86) Premier Equity Funds, Inc. 87) Premier Global Investing, Inc. 88) Premier GNMA Fund 89) Premier Growth Fund, Inc. 90) Premier Municipal Bond Fund 91) Premier New York Municipal Bond Fund 92) Premier State Municipal Bond Fund 93) Premier Strategic Growth Fund 94) Premier Strategic Investing (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 S. Tower, III+ Senior Vice President, Treasurer Vice President and Chief Financial Officer and Assistant Treasurer John E. Pelletier+ Senior Vice President, General Vice President Counsel, Secretary and Clerk and Secretary Roy M. Moura+ First Vice President None Dale F. Lampe+ Vice President None Mary Nelson+ Vice President Vice President and Assistant Treasurer Paul Prescott+ Vice President None Elizabeth Bachman++ Assistant Vice President Vice President and Assistant Secretary 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. Mellon Bank, N.A. One Mellon Bank Center Pittsburgh, Pennsylvania 15258 3. Dreyfus Transfer, Inc. P.O. Box 9671 Providence, Rhode Island 02940-9671 4. The Dreyfus Corporation 200 Park Avenue New York, New York 10166 Item 31. Management Services _______ ___________________ Not Applicable Item 32. Undertakings ________ ____________ (1) To call a meeting of shareholders for the purpose of voting upon the question of removal of a director or directors when requested in writing to do so by the holders of at least 10% of the Registrant's outstanding shares of common stock and in connection with such meeting to comply with the provisions of Section 16(c) of the Investment Company Act of 1940 relating to shareholder communications. (2) To furnish each person to whom a prospectus is delivered with a copy of the Fund's latest Annual Report to Shareholders, upon request and without charge. SIGNATURES __________ Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Registrant 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 July, 1996. THE DREYFUS THIRD CENTURY FUND, INC. BY: /s/Marie E. Connolly* ------------------------------------- MARIE E. CONNOLLY, PRESIDENT Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, 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 7/29/96 - ---------------------------- (Principal Executive, Financial Marie E. Connolly and Accounting Officer) /s/Clifford L. Alexander, Jr.* Director 7/29/96 - ---------------------------- Clifford L. Alexander, Jr. /s/Lucy Wilson Benson* Director 7/29/96 - ---------------------------- Lucy Wilson Benson /s/Joseph DiMartino* Chairman of the Board of 7/29/96 - ---------------------------- Directors Joseph DiMartino /s/Peter C. Goldmark, Jr.* Director 7/29/96 - ---------------------------- Peter C. Goldmark, Jr. *BY: ___________________________ Elizabeth Bachman, Attorney-in-Fact EX-99.B5 2 AMENDED AND RESTATED SUB-INVESTMENT ADVISORY AGREEMENT AMENDED AND RESTATED SUB-INVESTMENT ADVISORY AGREEMENT THE DREYFUS CORPORATION 200 Park Avenue New York, New York 10166 April 22, 1996 NCM Capital Management Group, Inc. 103 West Main Street, 4th Floor Durham, North Carolina 27701-3638 Dear Sirs: As you are aware, The Dreyfus Third Century Fund, Inc., a Maryland corporation (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 Articles of Incorporation 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 of Directors. The Fund intends to employ The Dreyfus Corporation (the "Adviser") to act as its investment adviser pursuant to a written agreement (the "Management Agreement"), a copy of which has been furnished to you. The Adviser desires to employ you to act as the Fund's sub-investment adviser. 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 include persons employed by you who also act as officers of the Fund. The compensation of such person or persons shall be paid by you and no obligation may be incurred on either the Fund's or Adviser's behalf in any such respect. Subject to the supervision and approval of the Adviser, you will provide investment management of the Fund's portfolio in accordance with the Fund's investment objectives 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 conduct a continuous program of investment, evaluation and, if appropriate, sale and reinvestment of the Fund's assets. You will furnish to the Adviser or the Fund such statistical information, with respect to the investments which the Fund may hold or contemplate purchasing, as the Adviser or the Fund may reasonably request. The Fund and the Adviser 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 the Adviser 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 the Adviser 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 the Adviser, provided that nothing herein shall be deemed to protect or purport to protect you against any liability to the Adviser, 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 services rendered pursuant to this Agreement, the Adviser 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 based on the Fund's average daily net assets for the preceding month as follows: Annual Fee as a Percentage of Total Assets Average Daily Net Assets 0 to $400 million .10 of 1% In excess of $400 to $500 million .15 of 1% In excess of $500 to $750 million .20 of 1% In excess of $750 million .25 of 1% 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 following the commencement of sales of the Fund's shares (after any sales are made to the Adviser) to the end of the month during which such sales shall have been commenced 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 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 Articles of Incorporation 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. The Adviser and the Fund have agreed that all other expenses to be incurred in the operation of the Fund (other than those borne by the Adviser) will be borne by the Fund, except to the extent specifically assumed by the Adviser or you. The expenses to be borne by the Fund include, without limitation, the following: organizational costs, taxes, interest, loan committment fees, interest and distributions on securities sold short, brokerage fees and commissions, if any, fees of Directors who are not officers, directors, employees or holders of 5% or more of the outstanding voting securities of you or the Adviser or any affiliate of you or the Adviser, Securities and Exchange Commission fees and state Blue Sky qualification fees, advisory fees, charges of custodians, transfer and dividend disbursing agents' fees, certain insurance premiums, industry association fees, outside auditing and legal expenses, costs of independent pricing services, costs of maintaining the Fund's existence, costs attributable to investor services (including, without limitation, telephone and personnel expenses), costs of stockholders' reports and meetings, costs of preparing, printing and distributing certain prospectuses and statements of additional information, 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 1-1/2% of the average value of the Fund's net assets for the fiscal year, the Adviser may deduct from the fees to be paid hereunder, or you will bear such excess expense on a pro-rata basis with the Adviser, in the proportion that the sub-advisory fee payable to you pursuant to this Agreement bears to the fee payable to the Adviser pursuant to the Management Agreement, 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 Adviser 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 the Adviser 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. Notwithstanding the above, you agree that you will not act as an investment adviser or sub-adviser for any other registered investment company having socially responsible investment policies, except those investment companies under your management as of December 31, 1995, without the prior written consent of the Fund and the Adviser. 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 herein contained 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 the Adviser 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, Director, 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 April 22, 1998, and thereafter shall continue automatically for successive annual periods ending on April 22nd of each year, provided such continuance is specifically approved at least annually by (i) the Fund's Board of Directors or (ii) a 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 Directors 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 the Adviser upon 60 days' notice to you, (ii) by the Fund's Board of Directors 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 the Adviser. 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: NCM CAPITAL MANAGEMENT GROUP, INC. By:_______________________________________ EX-99.B8 3 CUSTODY AGREEMENT CUSTODY AGREEMENT AGREEMENT dated as of May 10, 1996, between The Dreyfus Third Century Fund, Inc., a corporation organized under the laws of the State of Maryland (the "Fund"), having its principal office and place of business at 200 Park Avenue, New York, New York 10166, and Mellon Bank, N.A., (the "Custodian"), a national banking association with its principal place of business at One Mellon Bank Center, Pittsburgh, PA 15258. W I T N E S S E T H: That for and in consideration of the mutual promises hereinafter set forth, the Fund and the Custodian agree as follows: 1. Definitions. Whenever used in this Agreement or in any Schedules to this Agreement, the following words and phrases, unless the context otherwise requires, shall have the following meanings: (a) "Affiliated Person" shall have the meaning of the term within Section 2(a)3 of the 1940 Act. (b) "Authorized Person" shall mean those persons duly authorized by the Board of Directors of the Fund to give Oral Instructions and Written Instructions on behalf of the Fund and listed in the certification annexed hereto as Appendix A or such other certification as may be received by the Custodian from time to time. (c) "Book-Entry System" shall mean the Federal Reserve/Treasury book- entry system for United States and federal agency Securities, its successor or successors and its nominee or nominees, in which the Custodian is hereby specifically authorized and instructed on a continuous and on-going basis to deposit all Securities eligible for deposit therein, and to utilize the Book-Entry System to the extent possible in connection with its performance hereunder. (d) "Business Day" shall mean each day on which the Fund is required to determine its net asset value, and any other day on which the Securities and Exchange Commission may require the Fund to be open for business. (e) "Certificate" shall mean any notice, instruction or other instrument in writing, authorized or required by this Agreement to be given to the Custodian, which is actually received by the Custodian and signed on behalf of the Fund by any two Authorized Persons or any two officers thereof. (f) "Articles of Incorporation" shall mean the Articles of Incorporation of the Fund dated October 8, 1981 as the same may be amended from time to time. (g) "Depository" shall mean The Depository Trust Company ("DTC"), a clearing agency registered with the Securities and Exchange Commission under Section 17(a) of the Securities Exchange Act of 1934, as amended, its successor or successors and its nominee or nominees, in which the Custodian is hereby specifically authorized and instructed on a continuous and on-going basis to deposit all Securities eligible for deposit therein, and to utilize the Book-Entry System to the extent possible in connection with its performance hereunder. The term "Depository" shall further mean and include any other person to be named in a Certificate authorized to act as a depository under the 1940 Act, its successor or successors and its nominee or nominees. (h) "Money Market Security" shall be deemed to include, without limitation, debt obligations issued or guaranteed as to interest and principal by the government of the United States or agencies or instrumentalities thereof ("U.S. government securities"), commercial paper, bank certificates of deposit, bankers' acceptances and short- term corporate obligations, where the purchase or sale of such securities normally requires settlement in federal funds on the same day as such purchase or sale, and repurchase and reverse repurchase agreements with respect to any of the foregoing types of securities and bank time deposits. (i) "Oral Instructions" shall mean verbal instructions actually received by the Custodian from a person reasonably believed by the Custodian to be an Authorized Person. (j) "Prospectus" shall mean the Fund's current prospectus and statement of additional information relating to the registration of the Fund's Shares under the Securities Act of 1933, as amended. (k) "Shares" shall mean all or any part of each class of Common Stock of the Fund listed in the Certificate annexed hereto as Appendix B, as it may be amended from time to time, which from time to time are authorized and/or issued by the Fund. (l) "Security" or "Securities" shall be deemed to include bonds, debentures, notes, stocks, shares, evidences of indebtedness, and other securities, commodities interests and investments from time to time owned by the Fund. (m) "Transfer Agent" shall mean the person which performs the transfer agent, dividend disbursing agent and shareholder servicing agent functions for the Fund. (n) "Written Instructions" shall mean a written communication actually received by the Custodian from a person reasonably believed by the Custodian to be an Authorized Person by any system, including, without limitation, electronic transmissions, facsimile and telex, whereby the receiver of such communication is able to verify by codes or otherwise with a reasonable degree of certainty the authenticity of the sender of such communication. (o) The "1940 Act" refers to the Investment Company Act of 1940, and the Rules and Regulations thereunder, all as amended from time to time. 2. Appointment of Custodian. (a) The Fund hereby constitutes and appoints the Custodian as custodian of all the Securities and monies at the time owned by or in the possession of the Fund during the period of this Agreement. (b) The Custodian hereby accepts appointment as such custodian and agrees to perform the duties thereof as hereinafter set forth. 3. Compensation. (a) The Fund will compensate the Custodian for its services rendered under this Agreement in accordance with the fees set forth in the Fee Schedule annexed hereto as Schedule A and incorporated herein. Such Fee Schedule does not include out-of-pocket disbursements of the Custodian for which the Custodian shall be entitled to bill separately. Out-of-pocket disbursements shall consist of the items specified in the Schedule of Out-of-pocket charges annexed hereto as Schedule B and incorporated herein, which schedule may be modified by the Custodian upon not less than thirty days prior written notice to the Fund. (b) Any compensation agreed to hereunder may be adjusted from time to time by attaching to Schedule A of this Agreement a revised Fee Schedule, dated and signed by an Authorized Officer or authorized representative of each party hereto. (c) The Custodian will bill the Fund as soon as practicable after the end of each calendar month, and said billings will be detailed in accordance with Schedule A, as amended from time to time. The Fund will promptly pay to the Custodian the amount of such billing. The Custodian may charge against any monies held on behalf of the Fund pursuant to this Agreement such compensation and disbursements incurred by the Custodian in the performance of its duties pursuant to this Agreement. The Custodian shall also be entitled to charge against any money held on behalf of the Fund pursuant to this Agreement the amount of any loss, damage, liability or expense incurred with respect to the Fund, including counsel fees, for which it shall be entitled to reimbursement under the provisions of this Agreement. 4. Custody of Cash and Securities. (a) Receipt and Holding of Assets. The Fund will deliver or cause to be delivered to the Custodian or its permitted Sub-Custodians all Securities and monies owned by it at any time during the period of this Agreement. The Custodian will not be responsible for such Securities and monies until actually received by it. The Fund shall instruct the Custodian from time to time in its sole discretion, by means of Written Instructions, or, in connection with the purchase or sale of Money Market Securities, by means of Oral Instructions confirmed in writing in accordance with Section 11(h) hereof or Written Instructions, as to the manner in which and in what amounts Securities and monies are to be deposited on behalf of the Fund in the Book-Entry System or the Depository. Securities and monies of the Fund deposited in the Book-Entry System or the Depository will be represented in accounts which include only assets held by the Custodian for customers, including but not limited to accounts for which the Custodian acts in a fiduciary or representative capacity. (b) Accounts and Disbursements. The Custodian shall establish and maintain a separate account for the Fund and shall credit to the separate account all monies received by it for the account of such Fund and shall disburse the same only: 1. In payment for Securities purchased for the Fund, as provided in Section 5 hereof; 2. In payment of dividends or distributions with respect to the Shares, as provided in Section 7 hereof; 3. In payment of original issue or other taxes with respect to the Shares, as provided in Section 8 hereof; 4. In payment for Shares which have been redeemed by the Fund, as provided in Section 8 hereof; 5. Pursuant to a Certificate setting forth the name and address of the person to whom the payment is to be made, the amount to be paid and the purpose for which payment is to be made, provided that in the event of disbursements pursuant to this Sub-section 4(b)(5), the Fund shall indemnify and hold the Custodian harmless from any claims or losses arising out of such disbursements in reliance on such Certificate; or 6. In payment of fees and in reimbursement of the expenses and liabilities of the Custodian attributable to the Fund, as provided in Sections 3 and 11(i). (c) Confirmation and Statements. Promptly after the close of business on each day, the Custodian shall furnish the Fund with confirmations and a summary of all transfers to or from the account of the Fund during said day. Where securities purchased by the Fund are in a fungible bulk of securities registered in the name of the Custodian (or its nominee) or shown on the Custodian's account on the books of the Depository or the Book-Entry System, the Custodian shall by book entry or otherwise identify the quantity of those securities belonging to the Fund. At least monthly, the Custodian shall furnish the Fund with a detailed statement of the Securities and monies held for the Fund under this Agreement. (d) Registration of Securities and Physical Separation. All Securities held for the Fund which are issued or issuable only in bearer form, except such Securities as are held in the Book-Entry System, shall be held by the Custodian in that form; all other Securities held for the Fund may be registered in the name of the Fund, in the name of the Custodian, in the name of any duly appointed registered nominee of the Custodian as the Custodian may from time to time determine, or in the name of the Book-Entry System or the Depository or their successor or successors, or their nominee or nominees. The Fund reserves the right to instruct the Custodian as to the method of registration and safekeeping of the Securities. The Fund agrees to furnish to the Custodian appropriate instruments to enable the Custodian to hold or deliver in proper form for transfer, or to register in the name of its registered nominee or in the name of the Book-Entry System or the Depository, any Securities which it may hold for the account of the Fund and which may from time to time be registered in the name of the Fund. The Custodian shall hold all such Securities specifically allocated to the Fund which are not held in the Book-Entry System or the Depository in a separate account for the Fund in the name of the Fund physically segregated at all times from those of any other person or persons. (e) Segregated Accounts. Upon receipt of a Certificate the Custodian will establish segregated accounts on behalf of the Fund to hold liquid or other assets as it shall be directed by a Certificate and shall increase or decrease the assets in such segregated accounts only as it shall be directed by subsequent Certificate. (f) Collection of Income and Other Matters Affecting Securities. Unless otherwise instructed to the contrary by a Certificate, the Custodian by itself, or through the use of the Book-Entry System or the Depository with respect to Securities therein deposited, shall with respect to all Securities held for the Fund in accordance with this Agreement: 1. Collect all income due or payable; 2. Present for payment and collect the amount payable upon all Securities which may mature or be called, redeemed, retired or otherwise become payable. Notwithstanding the foregoing, the Custodian only shall have such responsibility to the Fund for Securities which are called if either (i) the Custodian received a written notice of such call; or (ii) notice of such call appears in one or more of the publications listed in Appendix C annexed hereto, which may be amended at any time by the Custodian upon five (5) Business Days prior notification to the Fund; 3. Surrender Securities in temporary form for definitive Securities; 4. Execute any necessary declarations or certificates of ownership under the Federal income tax laws or the laws or regulations of any other taxing authority now or hereafter in effect; and 5. Hold directly, or through the Book-Entry System or the Depository with respect to Securities therein deposited, for the account of the Fund all rights and similar Securities issued with respect to any Securities held by the Custodian hereunder for the Fund. (g) Delivery of Securities and Evidence of Authority. Upon receipt of a Certificate, the Custodian, directly or through the use of the Book-Entry System or the Depository, shall: 1. Execute and deliver or cause to be executed and delivered to such persons as may be designated in such Certificate, proxies, consents, authorizations, and any other instruments whereby the authority of the Fund as owner of any Securities may be exercised; 2. Deliver or cause to be delivered any Securities held for the Fund in exchange for other Securities or cash issued or paid in connection with the liquidation, reorganization, refinancing, merger, consolidation or recapitalization of any corporation, or the exercise of any conversion privilege; 3. Deliver or cause to be delivered any Securities held for the Fund to any protective committee, reorganization committee or other person in connection with the reorganization, refinancing, merger, consolidation or recapitalization or sale of assets of any corporation, and receive and hold under the terms of this Agreement in the separate account for the Fund such certificates of deposit, interim receipts or other instruments or documents as may be issued to it to evidence such delivery; 4. Make or cause to be made such transfers or exchanges of the assets specifically allocated to the separate account of the Fund and take such other steps as shall be stated in a Certificate to be for the purpose of effectuating any duly authorized plan of liquidation, reorganization, merger, consolidation or recapitalization of the Fund; 5. Deliver Securities upon the receipt of payment in connection with any repurchase agreement related to such Securities entered into by the Fund; 6. Deliver Securities owned by the Fund to the issuer thereof or its agent when such Securities are called or otherwise become payable. Notwithstanding the foregoing, the Custodian shall have no responsibility for monitoring or ascertaining any call, redemption or retirement dates with respect to put bonds which are owned by the Fund and held by the Custodian or its nominees. Nor shall the Custodian have any responsibility or liability to the Fund for any loss by the Fund for any missed payments or other defaults resulting therefrom; unless the Custodian received timely notification from the Fund specifying the time, place and manner for the presentment of any such put bond owned by the Fund and held by the Custodian or its nominee. The Custodian shall not be responsible and assumes no liability to the Fund for the accuracy or completeness of any notification the Custodian may furnish to the Fund with respect to put bonds 7. Deliver Securities for delivery in connection with any loans of Securities made by the Fund but only against receipt of adequate collateral as agreed upon from time to time by the Custodian and the Fund which may be in the form of cash or U.S. government securities or a letter of credit; 8. Deliver Securities for delivery as security in connection with any borrowings by the Fund requiring a pledge of Fund assets, but only against receipt of amounts borrowed; 9. Deliver Securities upon receipt of a Certificate from the Fund for delivery to the Transfer Agent or to the holders of Shares in connection with distributions in kind, as may be described from time to time in the Fund's Prospectus, in satisfaction of requests by holders of Shares for repurchase or redemption; 10. Deliver Securities as collateral in connection with short sales by the Fund of common stock for which the Fund owns the stock or owns preferred stocks or debt securities convertible or exchangeable, without payment or further consideration, into shares of the common stock sold short; 11. Deliver Securities for any purpose expressly permitted by and in accordance with procedures described in the Fund's Prospectus; and 12. Deliver Securities for any other proper business purpose, but only upon receipt of, in addition to Written Instructions, a certified copy of a resolution of the Board of Directors signed by an Authorized Person and certified by the Secretary of the Fund, specifying the Securities to be delivered, setting forth the purpose for which such delivery is to be made, declaring such purpose to be a proper business purpose, and naming the person or persons to whom delivery of such Securities shall be made. (h) Endorsement and Collection of Checks, Etc. The Custodian is hereby authorized to endorse and collect all checks, drafts or other orders for the payment of money received by the Custodian for the account of the Fund. 5. Purchase and Sale of Investments of the Fund. (a) Promptly after each purchase of Securities for the Fund, the Fund shall deliver to the Custodian (i) with respect to each purchase of Securities which are not Money Market Securities, a Certificate; and (ii) with respect to each purchase of Money Market Securities, either a Written Instruction or Oral Instruction, in either case specifying with respect to each purchase: (1) the name of the issuer and the title of the Securities; (2) the number of shares or the principal amount purchased and accrued interest, if any; (3) the date of purchase and settlement; (4) the purchase price per unit; (5) the total amount payable upon such purchase; (6) the name of the person from whom or the broker through whom the purchase was made, if any; and (7) whether or not such purchase is to be settled through the Book-Entry System or the Depository. The Custodian shall receive the Securities purchased by or for the Fund and upon receipt of Securities shall pay out of the monies held for the account of the Fund the total amount payable upon such purchase, provided that the same conforms to the total amount payable as set forth in such Certificate, Written or Oral Instruction. (b) Promptly after each sale of Securities of the Fund, the Fund shall deliver to the Custodian (i) with respect to each sale of Securities which are not Money Market Securities, a Certificate, and (ii) with respect to each sale of Money Market Securities, either Written Instruction or Oral Instructions, in either case specifying with respect to such sale: (1) the name of the issuer and the title of the Securities; (2) the number of shares or principal amount sold, and accrued interest, if any; (3) the date of sale; (4) the sale price per unit; (5) the total amount payable to the Fund upon such sale; (6) the name of the broker through whom or the person to whom the sale was made; and (7) whether or not such sale is to be settled through the Book-Entry System or the Depository. The Custodian shall deliver or cause to be delivered the Securities to the broker or other person designated by the Fund upon receipt of the total amount payable to the Fund upon such sale, provided that the same conforms to the total amount payable to the Fund as set forth in such Certificate, Written or Oral Instruction. Subject to the foregoing, the Custodian may accept payment in such form as shall be satisfactory to it, and may deliver Securities and arrange for payment in accordance with the customs prevailing among dealers in Securities. 6. Lending of Securities. If the Fund is permitted by the terms of the Articles of Incorporation and as disclosed in its Prospectus to lend securities, within 24 hours after each loan of Securities, the Fund shall deliver to the Custodian a Certificate specifying with respect to each such loan: (a) the name of the issuer and the title of the Securities; (b) the number of shares or the principal amount loaned; (c) the date of loan and delivery; (d) the total amount to be delivered to the Custodian, and specifically allocated against the loan of the Securities, including the amount of cash collateral and the premium, if any, separately identified; and (e) the name of the broker, dealer or financial institution to which the loan was made. Promptly after each termination of a loan of Securities, the Fund shall deliver to the Custodian a Certificate specifying with respect to each such loan termination and return of Securities: (a) the name of the issuer and the title of the Securities to be returned; (b) the number of shares or the principal amount to be returned; (c) the date of termination; (d) the total amount to be delivered by the Custodian (including the cash collateral for such Securities minus any offsetting credits as described in said Certificate); and (e) the name of the broker, dealer or financial institution from which the Securities will be returned. The Custodian shall receive all Securities returned from the broker, dealer or financial institution to which such Securities were loaned and upon receipt thereof shall pay the total amount payable upon such return of Securities as set forth in the Certificate. Securities returned to the Custodian shall be held as they were prior to such loan. 7. Payment of Dividends or Distributions. (a) The Fund shall furnish to the Custodian a Certificate specifying the date of payment of any dividend or distribution, and the total amount payable to the Transfer Agent on the payment date. (b) Upon the payment date specified in such Certificate, the Custodian shall pay out the total amount payable to the Transfer Agent of the Fund. 8. Sale and Redemption of Shares of the Fund. (a) Whenever the Fund shall sell any Shares, or whenever any shares are redeemed, the Fund shall deliver or cause to be delivered to the Custodian a Written Instruction from the Transfer Agent duly specifying: 1. The net amount of money to be received by the Custodian, where the sale of such Shares exceeds redemption; and 2. The net amount of money to be paid for such Shares, where redemptions exceed purchases. The Custodian understands and agrees that Written Instructions may be furnished subsequent to the purchase of Shares and that the information contained therein will be derived from the sales of Shares as reported to the Fund by the Transfer Agent. (b) Upon receipt of money from the Transfer Agent, the Custodian shall credit such money to the separate account of the Fund. (c) Upon issuance of any Shares in accordance with the foregoing provisions of this Section 8, the Custodian shall pay all original issue or other taxes required to be paid in connection with such issuance upon the receipt of a Written Instruction specifying the amount to be paid. (d) Upon receipt from the Transfer Agent of Written Instructions setting forth the net amount of money to be paid for Shares received by the Transfer Agent for redemption, the Custodian shall make payment to the Transfer Agent of such net amount. 9. Indebtedness. (a) The Fund will cause to be delivered to the Custodian by any bank (excluding the Custodian) from which the Fund borrows money for investment or for temporary administrative or emergency purposes using Securities as collateral for such borrowings, a notice or undertaking in the form currently employed by any such bank setting forth the amount which such bank will loan to the Fund against delivery of a stated amount of collateral. The Fund shall promptly deliver to the Custodian a Certificate stating with respect to each such borrowing: (1) the name of the bank; (2) the amount and terms of the borrowing, which may be set forth by incorporating by reference an attached promissory note, duly endorsed by the Fund, or other loan agreement; (3) the time and date, if known, on which the loan is to be entered into (the "borrowing date"); (4) the date on which the loan becomes due and payable; (5) the total amount payable to the Fund on the borrowing date; (6) the market value of Securities to be delivered as collateral for such loan, including the name of the issuer, the title and the number of shares or the principal amount of any particular Securities; and (7) a statement that such loan is in conformance with the 1940 Act and the Fund's Prospectus. (b) Upon receipt of the Certificate referred to in subparagraph (a) above, the Custodian shall deliver on the borrowing date the specified collateral and the executed promissory note, if any, against delivery by the lending bank of the total amount of the loan payable, provided that the same conforms to the total amount payable as set forth in the Certificate. The Custodian may, at the option of the lending bank, keep such collateral in its possession, but such collateral shall be subject to all rights therein given the lending bank by virtue of any promissory note or loan agreement. The Custodian shall deliver as additional collateral in the manner directed by the Fund from time to time such Securities as may be specified in the Certificate to collateralize further any transaction described in this Section 9. The Fund shall cause all Securities released from collateral status to be returned directly to the Custodian, and the Custodian shall receive from time to time such return of collateral as may be tendered to it. In the event that the Fund fails to specify in the Certificate all of the information required by this Section 9, the Custodian shall not be under any obligation to deliver any Securities. Collateral returned to the Custodian shall be held hereunder as it was prior to being used as collateral. 10. Persons Having Access to Assets of the Fund. (a) No trustee or agent of the Fund, and no officer, director, employee or agent of the Fund's investment adviser, of any sub investment adviser of the Fund, or of the Fund's administrator, shall have physical access to the assets of the Fund held by the Custodian or be authorized or permitted to withdraw any investments of the Fund, nor shall the Custodian deliver any assets of the Fund to any such person. No officer, director, employee or agent of the Custodian who holds any similar position with the Fund's investment adviser, with any sub-investment adviser of the Fund or with the Fund's administrator shall have access to the assets of the Fund. (b) Nothing in this Section 10 shall prohibit any duly authorized officer, employee or agent of the Fund, or any duly authorized officer, director, employee or agent of the investment adviser, of any sub-investment adviser of the Fund or of the Fund's administrator, from giving Oral Instructions or Written Instructions to the Custodian or executing a Certificate so long as it does not result in delivery of or access to assets of the Fund prohibited by paragraph (a) of this Section 10. 11. Concerning the Custodian. (a) Standard of Conduct. Notwithstanding any other provision of this Agreement, neither the Custodian nor its nominee shall be liable for any loss or damage, including counsel fees, resulting from its action or omission to act or otherwise, except for any such loss or damage arising out of the negligence, misfeasance or willful misconduct of the Custodian or any of its employees, Sub-Custodians or agents. The Custodian may, with respect to questions of law, apply for and obtain the advice and opinion of counsel to the Fund or of its own counsel, at the expense of the Fund, and shall be fully protected with respect to anything done or omitted by it in good faith in conformity with such advice or opinion. The Custodian shall not be liable to the Fund for any loss or damage resulting from the use of the Book-Entry System or the Depository, except to the extent such loss or damage arises by reason of any negligence, misfeasance or willful misconduct on the part of the Custodian or any of its employees or agents. (b) Limit of Duties. Without limiting the generality of the foregoing, the Custodian shall be under no duty or obligation to inquire into, and shall not be liable for: 1. The validity of the issue of any Securities purchased by the Fund, the legality of the purchase thereof, or the propriety of the amount paid therefor; 2. The legality of the sale of any Securities by the Fund or the propriety of the amount for which the same are sold; 3. The legality of the issue or sale of any Shares, or the sufficiency of the amount to be received therefor; 4. The legality of the redemption of any Shares, or the propriety of the amount to be paid therefor; 5. The legality of the declaration or payment of any distribution of the Fund; 6. The legality of any borrowing for temporary or emergency administrative purposes. (c) No Liability Until Receipt. The Custodian shall not be liable for, or considered to be the Custodian of, any money, whether or not represented by any check, draft, or other instrument for the payment of money, received by it on behalf of the Fund until the Custodian actually receives and collects such money directly or by the final crediting of the account representing the Fund's interest in the Book- Entry System or the Depository. (d) Amounts Due from Transfer Agent. The Custodian shall not be under any duty or obligation to take action to effect collection of any amount due to the Fund from the Transfer Agent nor to take any action to effect payment or distribution by the Transfer Agent of any amount paid by the Custodian to the Transfer Agent in accordance with this Agreement. (e) Collection Where Payment Refused. The Custodian shall not be under any duty or obligation to take action to effect collection of any amount, if the Securities upon which such amount is payable are in default, or if payment is refused after due demand or presentation, unless and until (a) it shall be directed to take such action by a Certificate and (b) it shall be assured to its satisfaction of reimbursement of its costs and expenses in connection with any such action. (f) Appointment of Agents and Sub-Custodians. The Custodian may appoint one or more banking institutions, including but not limited to banking institutions located in foreign countries, to act as Depository or Depositories or as Sub-Custodian or as Sub-Custodians of Securities and monies at any time owned by the Fund. The Custodian shall use reasonable care in selecting a Depository and/or Sub- Custodian located in a country other than the United States ("Foreign Sub-Custodian"), which selection shall be in accordance with the requirements of Rule 17f-5 under the 1940 Act, and shall oversee the maintenance of any Securities or monies of the Fund by any Foreign Sub-Custodian. In addition, the Custodian shall hold the Fund harmless from, and indemnify the Fund against, any loss, action, claim, demand, expense and proceeding, including counsel fees, that occurs as a result of the failure of any Foreign Sub-Custodian or Depository to exercise reasonable care with respect to the safekeeping of Securities and monies of the Fund. Notwithstanding the generality of the foregoing, however, the Custodian shall not be liable for any losses resulting from the general risk of investing or holding Securities and monies in a particular country, including, but not limited to, losses resulting from nationalization, expropriation, devaluation, revaluation, confiscation, seizure, cancellation, destruction or similar action by any governmental authority, de facto or de jure; or enactment, promulgation, imposition or enforcement by any such governmental authority of currency restrictions, exchange controls, taxes, levies or other charges affecting the Fund's property; or acts of war, terrorism, insurrection or revolution; or any other similar act or event beyond the Custodian's control. (g) No Duty to Ascertain Authority. The Custodian shall not be under any duty or obligation to ascertain whether any Securities at any time delivered to or held by it for the Fund are such as may properly be held by the Fund under the provisions of the Articles of Incorporation and the Prospectus. (h) Reliance on Certificates and Instructions. The Custodian shall be entitled to rely upon any Certificate, notice or other instrument in writing received by the Custodian and reasonably believed by the Custodian to be genuine and to be signed by an officer or Authorized Person of the Fund. The Custodian shall be entitled to rely upon any Written Instructions or Oral Instructions actually received by the Custodian pursuant to the applicable Sections of this Agreement and reasonably believed by the Custodian to be genuine and to be given by an Authorized Person. The Fund agrees to forward to the Custodian Written Instructions from an Authorized Person confirming such Oral Instructions in such manner so that such Written Instructions are received by the Custodian, whether by hand delivery, telex or otherwise, by the close of business on the same day that such Oral Instructions are given to the Custodian. The Fund agrees that the fact that such confirming instructions are not received by the Custodian shall in no way affect the validity of the transactions or enforceability of the transactions hereby authorized by the Fund. The Fund agrees that the Custodian shall incur no liability to the Fund in acting upon Oral Instructions given to the Custodian hereunder concerning such transactions provided such instructions reasonably appear to have been received from a duly Authorized Person. (i) Overdraft Facility and Security for Payment. In the event that the Custodian is directed by Written Instruction (or Oral Instructions confirmed in writing in accordance with Section 11(h) hereof) to make any payment or transfer of monies on behalf of the Fund for which there would be, at the close of business on the date of such payment or transfer, insufficient monies held by the Custodian on behalf of the Fund, the Custodian may, in its sole discretion, provide an overdraft (an "Overdraft") to the Fund in an amount sufficient to allow the completion of such payment or transfer. Any Overdraft provided hereunder: (a) shall be payable on the next Business Day, unless otherwise agreed by the Fund and the Custodian; and (b) shall accrue interest from the date of the Overdraft to the date of payment in full by the Fund at a rate agreed upon in writing, from time to time, by the Custodian and the Fund. The Custodian and the Fund acknowledge that the purpose of such Overdraft is to temporarily finance the purchase of Securities for prompt delivery in accordance with the terms hereof, to meet unanticipated or unusual redemption, to allow the settlement of foreign exchange contracts or to meet other emergency expenses not reasonably foreseeable by the Fund. The Custodian shall promptly notify the Fund in writing (an "Overdraft Notice") of any Overdraft by facsimile transmission or in such other manner as the Fund and the Custodian may agree in writing. To secure payment of any Overdraft, the Fund hereby grants to the Custodian a continuing security interest in and right of setoff against the Securities and cash in the Fund's account from time to time in the full amount of such Overdraft. Should the Fund fail to pay promptly any amounts owed hereunder, the Custodian shall be entitled to use available cash in the Fund's account and to liquidate Securities in the account as is necessary to meet the Fund's obligations under the Overdraft. In any such case, and without limiting the foregoing, the Custodian shall be entitled to take such other actions(s) or exercise such other options, powers and rights as the Custodian now or hereafter has as a secured creditor under the Pennsylvania Uniform Commercial Code or any other applicable law. (j) Inspection of Books and Records. The books and records of the Custodian shall be open to inspection and audit at reasonable times by officers and auditors employed by the Fund and by the appropriate employees of the Securities and Exchange Commission. The Custodian shall provide the Fund with any report obtained by the Custodian on the system of internal accounting control of the Book-Entry System or the Depository and with such reports on its own systems of internal accounting control as the Fund may reasonably request from time to time. 12. Term and Termination. (a) This Agreement shall become effective on the date first set forth above (the "Effective Date") and shall continue in effect thereafter until such time as this Agreement may be terminated in accordance with the provisions hereof. (b) Either of the parties hereto may terminate this Agreement by giving to the other party a notice in writing specifying the date of such termination, which shall be not less than 60 days after the date of receipt of such notice. In the event such notice is given by the Fund, it shall be accompanied by a certified vote of the Board of Directors of the Fund, electing to terminate this Agreement and designating a successor custodian or custodians, which shall be a person qualified to so act under the 1940 Act. In the event such notice is given by the Custodian, the Fund shall, on or before the termination date, deliver to the Custodian a certified vote of the Board of Directors of the Fund, designating a successor custodian or custodians. In the absence of such designation by the Fund, the Custodian may designate a successor custodian, which shall be a person qualified to so act under the 1940 Act. If the Fund fails to designate a successor custodian, the Fund shall upon the date specified in the notice of termination of this Agreement and upon the delivery by the Custodian of all Securities (other than Securities held in the Book-Entry System which cannot be delivered to the Fund) and monies then owned by the Fund, be deemed to be its own custodian and the Custodian shall thereby be relieved of all duties and responsibilities pursuant to this Agreement, other than the duty with respect to Securities held in the Book-Entry System which cannot be delivered to the Fund. (c) Upon the date set forth in such notice under paragraph (b) of this Section 12, this Agreement shall terminate to the extent specified in such notice, and the Custodian shall upon receipt of a notice of acceptance by the successor custodian on that date deliver directly to the successor custodian all Securities and monies then held by the Custodian on behalf of the Fund, after deducting all fees, expenses and other amounts for the payment or reimbursement of which it shall then be entitled. 13. Limitation of Liability. The Fund and the Custodian agree that the obligations of the Fund under this Agreement shall not be binding upon any of the Directors, shareholders, nominees, officers, employees or agents, whether past, present or future, of the Fund, individually, but are binding only upon the assets and property of the Fund, as provided in the Articles of Incorporation. The execution and delivery of this Agreement have been authorized by the Directors of the Fund, and signed by an authorized officer of the Fund, acting as such, and neither such authorization by such Directors nor such execution and delivery by such officer shall be deemed to have been made by any of them or any shareholder of the Fund individually or to impose any liability on any of them or any shareholder of the Fund personally, but shall bind only the assets and property of the Fund as provided in the Articles of Incorporation. 14. Miscellaneous. (a) Annexed hereto as Appendix A is a certification signed by the Secretary of the Fund setting forth the names and the signatures of the present Authorized Persons. The Fund agrees to furnish to the Custodian a new certification in similar form in the event that any such present Authorized Person ceases to be such an Authorized Person or in the event that other or additional Authorized Persons are elected or appointed. Until such new certification shall be received, the Custodian shall be fully protected in acting under the provisions of this Agreement upon Oral Instructions or signatures of the present Authorized Persons as set forth in the last delivered certification. (b) Annexed hereto as Appendix B is a certification signed by the Secretary of the Fund setting forth the names and the signatures of the present officers of the Fund. The Fund agrees to furnish to the Custodian a new certification in similar form in the event any such present officer ceases to be an officer of the Fund or in the event that other or additional officers are elected or appointed. Until such new certification shall be received, the Custodian shall be fully protected in acting under the provisions of this Agreement upon the signature of an officer as set forth in the last delivered certification. (c) Any notice or other instrument in writing, authorized or required by this Agreement to be given to the Custodian, shall be sufficiently given if addressed to the Custodian and mailed or delivered to it at its offices at One Mellon Bank Center, Pittsburgh, PA 15258 or at such other place as the Custodian may from time to time designate in writing. (d) Any notice or other instrument in writing, authorized or required by this Agreement to be given to the Fund, shall be sufficiently given if addressed to the Fund and mailed or delivered to it at its offices at 200 Park Avenue, New York, New York 10166 or at such other place as the Fund may from time to time designate in writing. (e) This Agreement may not be amended or modified in any manner except by a written agreement executed by both parties with the same formality as this Agreement, (i) authorized, or ratified and approved by a vote of the Board of Directors of the Fund, including a majority of the members of the Board of Directors of the Fund who are not "interested persons" of the Fund (as defined in the 1940 Act), or (ii) authorized, or ratified and approved by such other procedures as may be permitted or required by the 1940 Act. (f) This Agreement shall extend to and shall be binding upon the parties hereto, and their respective successors and assigns; provided, however, that this Agreement shall not be assignable by the Fund without the written consent of the Custodian, or by the Custodian without the written consent of the Fund authorized or approved by a vote of the Board of Directors of the Fund. Nothing in this Agreement shall give or be construed to give or confer upon any third party any rights hereunder. (g) The Fund represents that a copy of the Articles of Incorporation is on file with the Secretary of the State of Maryland. (h) This Agreement shall be construed in accordance with the laws of the Commonwealth of Pennsylvania. (i) The captions of the Agreement are included for convenience of reference only and in no way define or delimit any of the provisions hereof or otherwise affect their construction or effect. (j) This agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but such counterparts shall, together, constitute only one instrument. IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective representatives duly authorized as of the day and year first above written. The Dreyfus Third Century Fund, Inc. By: Name: Title: MELLON BANK, N.A. By: Name: Title: APPENDIX A Eric B. Fischman, Assistant Secretary of The Dreyfus Third Century Fund, Inc., a corporation organized under the laws of the State of Maryland (the "Fund"), do hereby certify that: The following individuals have been duly authorized as Authorized Persons to give Oral Instructions and Written Instructions on behalf of the Fund and the specimen signatures set forth opposite their respective names are their true and correct signatures: Name Signature Thomas Durante Mike Stalzer Anna Mancini Jennifer Romano Kathy Jiminez Assistant Secretary Dated: APPENDIX B THE DREYFUS THIRD CENTURY FUND, INC. CUSTODY AGREEMENT I, Eric B. Fischman, Vice President and Assistant Secretary of The Dreyfus Third Century Fund, Inc., a corporation organized and existing under the laws of the State of Maryland (the "Fund"), do hereby certify that the only series of shares of the Fund issued and/or authorized by the Fund as of the date of this Custody Agreement are shares of Common Stock, $.001 par value: Vice President and Assistant Secretary Dated: APPENDIX C The following are designated publications for purposes of Section 4 (f) 2: The Bond Buyer Depository Trust Company Notices Financial Daily Card Service New York Times Standard & Poor's Called Bond Record Wall Street Journal SCHEDULE A I. Asset Based Charges A. U.S. Securities (Net Asset Value) First $1 Billion 0.70 Basis Points Next $1 Billion 0.50 Basis Points Excess 0.25 Basis Points B. International Securities (Market Value) Foreign Assets in all funds will be totaled by country and charged a basis point fee by category. Euroclear 5.00 Basis Points Category I 8.00 Basis Points Category II 14.00 Basis Points Category III 16.00 Basis Points Category IV 45.00 Basis Points (A complete listing of countries is on page 2 of this fee schedule) II. Transaction Charges A. Domestic U.S. Buy/Sell transaction (DTC, PTC, Fed) $ 7 Physical U.S. Buy/Sell transaction $20 B. International Euroclear $ 25 Category I $ 35 Category II $ 60 Category III $ 80 Category IV $100 C. Other Transactions Futures Transaction $ 8 Paydown Transaction $ 5 Margin Variation Wire $ 10 F/X not executed at BSDT $ 20 Options Round Trip $ 20 Wire Transfer $ 5 III. Out-of-Pocket Expenses The Custodian will pass through to the client any out-of-pocket expenses including, but not limited to, postage, courier expense, registration fees, stamp duties telex charges, custom reporting or custom programming, internal/external tax, legal or consulting costs, proxy voting expenses, etc. The Custodian reserves the right to amend its fees if the service requirements change in a way that materially affects our responsibilities or costs. Support of other derivative investment strategies or special processing requirements (e.g. external cash sweep, third party securities lending etc.) may result in additional fees. IV. Country by Country Categories: Category I Category II Category III CategoryIV Australia Argentina Austria Bangladesh Belgium Denmark Indonesia Brazil Canada Finland Israel Colombia France Hong Kong South Korea China Germany Malaysia Philippines Czech Republic Ireland Mexico Singapore Greece Italy Norway Thailand India Japan Spain Jordan Netherlands Luxembourg New Zealand Pakistan South Africa Peru Sweden Poland Switzerland Portugal United Kingdom Sri Lanka Cedel Taiwan Turkey Uruguay Venezuela SCHEDULE B The Fund will pay to the Custodian as soon as possible after the end of each month all out-of-pocket expenses reasonably incurred in connection with the assets of the Fund. EX-23 4 CONSENT OF INDEPENDENT ACCOUNTANT CONSENT OF INDEPENDENT AUDITORS We consent to the reference to our firm under the captions "Condensed Financial Information" and "Custodian, Transfer and Dividend Disbursing Agent, Counsel and Independent Auditors" and to the use of our report dated July 9, 1996, in this Registration Statement (Form N-1A 2-40341) of The Dreyfus Third Century Fund, Inc. ERNST & YOUNG LLP New York, New York July 31, 1996 EX-27 5 FINANCIAL DATA SCHEDULE
6 0000030167 THE DREYFUS THIRD CENTURY FUND, INC. 1000 YEAR MAY-31-1996 MAY-31-1996 362116 465741 7748 966 0 474455 324 0 679 1003 0 329978 51202 49487 774 0 39075 0 103625 473452 5249 904 0 4646 1507 62836 54728 119071 0 (2114) (27118) 0 40416 (42121) 3419 104619 1380 3358 0 0 3155 0 4646 420343 7.45 .03 2.39 (.05) (.57) 0 9.25 .011 0 0
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