Securities Act File No. 333-_____
U.S. SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
_______________________
FORM N-14
REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933
¨ Pre-Effective Amendment No. ¨ Post-Effective Amendment No.
(Check appropriate box or boxes)
__________________________________________________________________
STRATEGIC FUNDS, INC.
(Exact Name of Registrant as Specified in its Charter)
Registrant's Telephone Number, including Area Code: (212) 922-6000
c/o The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
(Address of Principal Executive Offices)
Michael A. Rosenberg, Esq.
200 Park Avenue
New York, New York 10166
(Name and Address of Agent for Service)
COPY TO:
David Stephens, Esq.
Stroock & Stroock & Lavan LLP
180 Maiden Lane
New York, New York 10038-4982
__________________________________________________________________
Approximate Date of Proposed Public Offering: As soon as practicable after this Registration Statement is declared effective.
An indefinite number of Registrant's shares of common stock, par value $0.001 per share, has been registered pursuant to Rule 24f-2 under the Investment Company Act of 1940. Accordingly, no filing fee is being paid at this time.
STRATEGIC FUNDS, INC.
Form N-14
Cross Reference Sheet
Pursuant to Rule 481(a) Under the Securities Act of 1933
FORM N-14 ITEM NO. | PROSPECTUS/PROXY STATEMENT CAPTION | |
PART A | ||
Item 1. | Beginning of Registration Statement and Outside Front Cover Pages of Prospectuses | Cover Page |
Item 2. | Beginning and Outside Back Cover Pages of Prospectuses | Cover Page |
Item 3. | Synopsis Information and Risk Factors | Summary |
Item 4. | Information About the Reorganizations | Letter to Shareholders; Questions and Answers; Summary; Reasons for the Reorganization; Information About the Reorganization; Exhibit A – Agreement and Plan of Reorganization |
Item 5. | Information About the Registrant | Letter to Shareholders; Questions and Answers; Summary; Reasons for the Reorganization; Information About the Reorganization; Additional Information About the Acquiring Fund and the Fund |
Item 6. | Information About the Funds Being Acquired | Letter to Shareholders; Questions and Answers; Summary; Reasons for the Reorganization; Information About the Reorganization; Additional Information About the Acquiring Fund and the Fund |
Item 7. | Voting Information | Letter to Shareholders; Questions and Answers; Notice of Special Meeting of Shareholders; Cover Page; Voting Information |
Item 8. | Interest of Certain Persons and Experts | Not Applicable |
Item 9. | Additional Information Required for Reoffering by Persons Deemed to be Underwriters | Not Applicable |
PART B | STATEMENT OF ADDITIONAL INFORMATION CAPTION | |
Item 10. | Cover Pages | Cover Page |
Item 11. | Table of Contents | Not Applicable |
Item 12. | Additional Information About the Registrant | Statement of Additional Information of the Registrant, dated May 1, 2010(1) |
Item 13. | Additional Information About the Funds Being Acquired | Statement of Additional Information of Advantage Funds, Inc., dated January 1, 2010(2); Statement of Additional Information of Dreyfus Manager Funds I, dated August 1, 2009 (3) |
Item 14. | Financial Statements | Annual Report of Dreyfus Structured Midcap Fund, a series of Advantage Funds, Inc., dated August 31, 2009(4); Semi-Annual Report of Dreyfus Structured Midcap Fund, a series of Advantage Funds, Inc., dated February 28, 2010(5); Annual Report of Dreyfus S&P STARS Opportunities Fund, a series of Dreyfus Manager Funds I, dated March 31, 2010(6); Annual Report of Dreyfus Active MidCap Fund, a series of the Registrant, dated December 31, 2009(7) |
PART C | ||
Item 15. | Indemnification | |
Item 16. | Exhibits | |
Item 17. | Undertakings |
_______________________
(1) | Incorporated herein by reference to Post-Effective Amendment No. 62 to the Registrant's Registration Statement on Form N-1A, filed April 30, 2010 (File No. 2-88816). |
(2) | Incorporated herein by reference to Post-Effective Amendment No. 88 to the Registration Statement on Form N-1A of Advantage Funds, Inc., filed December 23, 2009 (File No. 33-51061). |
(3) | Incorporated herein by reference to Post-Effective Amendment No. 15 to the Registration Statement on Form N-1A of Dreyfus Manager Funds I, filed July 29, 2009 (File No. 333-106576). |
(4) | Incorporated herein by reference to the Annual Report of Dreyfus Structured Midcap Fund, a series of Advantage Funds, Inc., filed November 2, 2009 (File No. 33-51061). |
(5) | Incorporated herein by reference to the Semi-Annual Report of Dreyfus Structured Midcap Fund, a series of Advantage Funds, Inc., filed April 29, 2010 (File No. 33-51061). |
(6) | Incorporated herein by reference to the Annual Report of Dreyfus S&P STARS Opportunities Fund, a series of Dreyfus Manager Funds I, filed May 25, 2010 (File No. 333-106576). |
(7) | Incorporated herein by reference to the Annual Report of Dreyfus Active MidCap Fund, a series of the Registrant, filed March 1, 2010 (File No. 2-88816). |
DREYFUS STRUCTURED MIDCAP FUND
c/o The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Dear Shareholder:
As a shareholder of Dreyfus Structured Midcap Fund (the "Fund"), you are being asked to vote on an Agreement and Plan of Reorganization to allow the Fund to transfer all of its assets in a tax-free reorganization to Dreyfus Active MidCap Fund (the "Acquiring Fund"), in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund and the assumption by the Acquiring Fund of the Fund's stated liabilities. The Fund is a series of Advantage Funds, Inc. (the "Company"). The Dreyfus Corporation ("Dreyfus") is the investment adviser to the Acquiring Fund and the Fund.
Management of Dreyfus has reviewed the funds in the Dreyfus Family of Funds and has concluded that it would be appropriate to consolidate certain funds having similar investment objectives and investment management policies and that would otherwise benefit fund shareholders. As a result of the review, management recommended to the Company's Board that the Fund be consolidated with the Acquiring Fund. If the Agreement and Plan of Reorganization is approved and consummated for the Fund, you would no longer be a shareholder of the Fund, but would become a shareholder of the Acquiring Fund. Management believes that the reorganization will permit Fund shareholders to pursue substantially similar investment goals in a larger combined fund that is expected to have a lower total expense ratio than the Fund. The Acquiring Fund, like the Fund, normally invests in stocks of mid-cap companies. Management also believes that the reorganization should enable Fund shareholders to benefit from more efficient portfolio management and will eliminate the duplication of resources and costs associated with marketing and servicing the funds as separate entities.
After careful review, the Company's Board of Directors has unanimously approved the proposed reorganization. The Company's Board of Directors believes that the reorganization will permit Fund shareholders to pursue substantially similar investment goals in a larger combined fund that is expected to have a lower total expense ratio than the Fund. The Company's Board of Directors recommends that you read the enclosed materials carefully and then vote FOR the proposal.
Your vote is extremely important, no matter how large or small your Fund holdings.
To vote, you may use any of the following methods:
● | By Mail. Please complete, date and sign the enclosed proxy card and mail it in the enclosed, postage-paid envelope. |
● | By Internet. Have your proxy card available. Go to the website listed on the proxy card. Enter your control number from your proxy card. Follow the instructions on the website. |
● | By Telephone. Have your proxy card available. Call the toll-free number listed on the proxy card. Enter your control number from your proxy card. Follow the recorded instructions. |
● | In Person. Any shareholder who attends the meeting in person may vote by ballot at the meeting. |
Further information about the proposed reorganization is contained in the enclosed materials, which you should review carefully before you vote. If you have any questions after considering the enclosed materials, please call 1-800-554-4611.
Sincerely, |
Bradley J. Skapyak President Advantage Funds, Inc. |
September __, 2010
TRANSFER OF THE ASSETS OF
DREYFUS STRUCTURED MIDCAP FUND
TO AND IN EXCHANGE FOR SHARES OF
DREYFUS ACTIVE MIDCAP FUND
QUESTIONS AND ANSWERS
The enclosed materials include a Prospectus/Proxy Statement containing information you need to make an informed decision. However, we thought it also would be helpful to begin by answering some of the important questions you might have about the proposed reorganization.
WHAT WILL HAPPEN TO MY DREYFUS STRUCTURED MIDCAP FUND INVESTMENT IF THE PROPOSED REORGANIZATION IS APPROVED?
You will become a shareholder of Dreyfus Active MidCap Fund (the "Acquiring Fund"), an open-end investment company managed by The Dreyfus Corporation ("Dreyfus"), on or about January 20, 2011 (the "Closing Date"), and will no longer be a shareholder of Dreyfus Structured Midcap Fund (the "Fund"). You will receive Class A, Class B, Class C or Class I shares of the Acquiring Fund corresponding to your Class A, Class B, Class C or Class I shares of the Fund with a value equal to the value of your investment in the Fund as of the Closing Date. The Fund will then cease operations and will be terminated as a series of Advantage Funds, Inc. (the "Company").
WHAT ARE THE BENEFITS OF THE PROPOSED REORGANIZATION FOR ME?
The Company's Board of Directors believes that the reorganization will permit Fund shareholders to pursue substantially similar investment goals in a larger combined fund that also is managed by Dreyfus. By combining the Fund with the Acquiring Fund, which has substantially more assets than the Fund, Fund shareholders should benefit from more efficient portfolio management. If the reorganization is consummated, the combined fund is expected to have a lower total expense ratio than the Fund. The reorganization also will eliminate the duplication of resources and costs associated with marketing and servicing the funds as separate entities. Other potential benefits are described in the enclosed Prospectus/Proxy Statement.
DO THE FUNDS HAVE SIMILAR INVESTMENT GOALS AND STRATEGIES?
Yes. The Acquiring Fund and the Fund have substantially similar investment objectives and investment management policies, but use different investment processes and approaches to select stocks. The Fund seeks long-term capital growth and the Acquiring Fund seeks to maximize capital appreciation. Each fund normally invests primarily in stocks of mid-cap companies. To pursue its goal, the Fund normally invests at least 80% of its assets in the stocks of companies included in the Standard & Poor's® MidCap 400 Index or the Russell Midcap® Index at the time of purchase. The Fund's portfolio managers select stocks through a "bottom-up," structured approach that seeks to identify undervalued securities using a quantitative screening process. The Fund's portfolio managers focus on stock selection as opposed to making proactive decisions as to industry and sector exposure. The Fund's portfolio managers seek to maintain a portfolio that has exposure to industries and market capitalizations that are generally similar to those of the Standard & Poor's MidCap 400 Index. To pursue its goal, the Acquiring Fund normally invests at least 80% of its assets in the stocks of midsize companies. The Acquiring Fund defines "midsize companies" as companies included in the Russell Midcap Index at the time of purchase. The Acquiring Fund's portfolio managers apply a systematic, quantitative investment approach designed to identify and exploit relative misvaluations primarily within mid-cap stocks in the U.S. stock market. The portfolio managers use a proprietary valuation model that identifies and ranks stocks to construct the Acquiring Fund's portfolio, focusing on stock selection as opposed to making proactive decisions as to industry or sector exposure. The Acquiring Fund generally attempts to have a neutral exposure to sectors, industries and capitalizations relative to the Russell Midcap Index. Dreyfus is the investment adviser to the Fund and the Acquiring Fund. Dreyfus has engaged its affiliate, Mellon Capital Management Corporation, to serve as the Fund's sub-investment adviser and provide day-to-day management of the Fund's investments. Dreyfus provides day-to-day management of the Acquiring Fund's investments. MBSC Securities Corporation, a wholly-owned subsidiary of Dreyfus, distributes the shares of the Fund and the Acquiring Fund. For additional information regarding the Fund and the Acquiring Fund, please refer to the enclosed Prospectus/Proxy Statement.
WHAT ARE THE TAX CONSEQUENCES OF THE PROPOSED REORGANIZATION?
The reorganization will not be a taxable event for federal income tax purposes. Shareholders will not recognize any capital gain or loss as a direct result of the reorganization. A shareholder's tax basis and holding period in Fund shares will carry over to the shareholder's Acquiring Fund shares. As a condition to the closing of the reorganization, the Fund and the Acquiring Fund will receive an opinion of counsel to the effect that, for federal income tax purposes, the reorganization will qualify as a tax-free reorganization and, thus, no gain or loss will be recognized by the Fund, the Fund's shareholders, or the Acquiring Fund as a result of the reorganization. The Fund will distribute any undistributed net investment income and net realized capital gains (after reduction for any capital loss carryforward) prior to the reorganization, which distribution will be taxable to shareholders. Certain tax attributes of the Fund will carry over to the Acquiring Fund, including the ability of the Acquiring Fund to utilize the Fund's capital loss carryforward; however, the ability of the Acquiring Fund to utilize the Fund's capital loss carryforward will be subject to limitations.
WILL I ENJOY THE SAME PRIVILEGES AS A SHAREHOLDER OF THE ACQUIRING FUND THAT I CURRENTLY HAVE AS A SHAREHOLDER OF THE FUND?
Yes. You will continue to enjoy the same shareholder privileges such as the Fund Exchanges service, Dreyfus TeleTransfer Privilege, Dreyfus-Automatic Asset BuilderÒ, Dreyfus Payroll Savings Plan, Dreyfus Government Direct Deposit Privilege, Dreyfus Dividend Options, Dreyfus Auto-Exchange Privilege and Dreyfus Automatic Withdrawal Plan.
WILL THE PROPOSED REORGANIZATION RESULT IN A HIGHER MANAGEMENT FEE OR HIGHER TOTAL FUND EXPENSES?
No. Under their respective agreements with Dreyfus, each fund has agreed to pay Dreyfus a management fee at the annual rate of 0.75% of the value of its average daily net assets. As of each fund's most recent fiscal year end, each class of shares of the Acquiring Fund, except Class I shares, had a lower total annual expense ratio than the corresponding class of shares of the Fund. If the reorganization is approved and consummated, it is expected that each class of shares, including Class I shares, of the combined fund will have a lower total annual expense ratio than the corresponding class of shares of the Fund.
WILL I BE CHARGED A SALES CHARGE, REDEMPTION FEE OR CONTINGENT DEFERRED SALES CHARGE ("CDSC") AT THE TIME OF THE REORGANIZATION?
No. No sales charge, redemption fee or CDSC will be imposed at the time of the reorganization. Any subsequent investment in the Acquiring Fund will be subject to any applicable sales charges and any redemption of Class B or Class C shares (or Class A shares subject to a CDSC) of the Acquiring Fund received in the reorganization will be subject to the same CDSC as redemption of Class B or Class C shares (or Class A shares subject to a CDSC) of the Fund (calculated from the date of original purchase of Fund shares).
WHO WILL PAY THE EXPENSES OF THE PROPOSED REORGANIZATION?
Dreyfus, and not the Fund or the Acquiring Fund, will pay the expenses directly related to the proposed reorganization. As discussed further in the enclosed Prospectus/Proxy Statement, transaction costs associated with any repositioning of the Fund's portfolio in connection with the proposed reorganization of the Fund after consummation of the reorganization will be borne by the combined fund.
HOW DOES THE COMPANY'S BOARD OF DIRECTORS RECOMMEND I VOTE?
After considering, among other factors, the terms and conditions of the reorganization, the investment management policies of, as well as shareholder services offered by, the Fund and the Acquiring Fund, fees and expenses, including the net expense ratios of the Fund and the Acquiring Fund, and the relative performance of the Fund and the Acquiring Fund, the Company's Board of Directors believes that reorganizing the Fund into the Acquiring Fund is in the best interests of the Fund and its shareholders. In reaching this conclusion, the Company's Board of Directors determined that reorganizing the Fund into the Acquiring Fund, which also is managed by Dreyfus and has a substantially similar investment objective and substantially similar investment management policies as those of the Fund, offers potential benefits to Fund shareholders. These potential benefits include permitting Fund shareholders to pursue substantially similar investment goals in a larger combined fund that is expected to have a lower total expense ratio than the Fund. By combining the Fund with the Acquiring Fund, shareholders of the Fund also should benefit from more efficient portfolio management. Therefore, the Company's Board of Directors recommends that you vote FOR the reorganization.
HOW CAN I VOTE MY SHARES?
You can vote in any one of the following ways: |
● | By mail, with the enclosed proxy card and postage-paid envelope; |
● | By telephone, with a toll-free call to the number listed on your proxy card; |
● | Through the Internet, at the website address listed on your proxy card; or |
● | In person at the meeting. |
We encourage you to vote through the Internet or by telephone using the number that appears on your proxy card. Whichever voting method you choose, please take the time to read the Prospectus/Proxy Statement before you vote.
Please note: if you sign and date your proxy card, but do not provide voting instructions, your shares will be voted FOR the proposal. Thank you in advance for your vote.
DREYFUS STRUCTURED MIDCAP FUND
__________________________
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
___________________________
To the Shareholders:
A Special Meeting of Shareholders of Dreyfus Structured Midcap Fund (the "Fund"), a series of Advantage Funds, Inc. (the "Company"), will be held at the offices of The Dreyfus Corporation, 200 Park Avenue, 8th Floor, New York, New York 10166, on Wednesday, November 17, 2010, at 9:30 a.m., for the following purposes:
1. | To approve an Agreement and Plan of Reorganization providing for the transfer of all of the assets of the Fund to Dreyfus Active MidCap Fund (the "Acquiring Fund"), in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund having an aggregate net asset value equal to the value of the Fund's net assets and the assumption by the Acquiring Fund of the Fund's stated liabilities (the "Reorganization"). Class A, Class B, Class C and Class I shares of the Acquiring Fund received by the Fund in the Reorganization will be distributed by the Fund to its Class A, Class B, Class C and Class I shareholders, respectively, in liquidation of the Fund, after which the Fund will cease operations and will be terminated as a series of the Company; and |
2. | To transact such other business as may properly come before the meeting, or any adjournment or adjournments thereof. |
Shareholders of record at the close of business on September 1, 2010 will be entitled to receive notice of and to vote at the meeting.
By Order of the Board of Directors |
Michael A. Rosenberg Secretary |
New York, New York
September __, 2010
WE NEED YOUR PROXY VOTE A SHAREHOLDER MAY THINK HIS OR HER VOTE IS NOT IMPORTANT, BUT IT IS VITAL. BY LAW, THE MEETING OF SHAREHOLDERS WILL HAVE TO BE ADJOURNED WITHOUT CONDUCTING ANY BUSINESS IF LESS THAN A QUORUM OF FUND SHARES ELIGIBLE TO VOTE IS REPRESENTED. IN THAT EVENT, THE FUND WOULD CONTINUE TO SOLICIT VOTES IN AN ATTEMPT TO ACHIEVE A QUORUM. CLEARLY, YOUR VOTE COULD BE CRITICAL TO ENABLE THE FUND TO HOLD THE MEETING AS SCHEDULED, SO PLEASE RETURN YOUR PROXY CARD OR OTHERWISE VOTE PROMPTLY. YOU AND ALL OTHER SHAREHOLDERS WILL BENEFIT FROM YOUR COOPERATION. |
Transfer of the Assets of
DREYFUS STRUCTURED MIDCAP FUND
(A Series of Advantage Funds, Inc.)
To and in Exchange for Class A, Class B, Class C and Class I Shares of
DREYFUS ACTIVE MIDCAP FUND
(A Series of Strategic Funds, Inc.)
PROSPECTUS/PROXY STATEMENT
AUGUST __, 2010
_______________________________________
Special Meeting of Shareholders
To Be Held on Wednesday, November 17, 2010
This Prospectus/Proxy Statement is furnished in connection with a solicitation of proxies by the Board of Directors of Advantage Funds, Inc. (the "Company"), on behalf of Dreyfus Structured Midcap Fund (the "Fund"), to be used at the Special Meeting of Shareholders (the "Meeting") of the Fund to be held on Wednesday, November 17, 2010, at 9:30 a.m., at the offices of The Dreyfus Corporation ("Dreyfus"), 200 Park Avenue, 8th Floor, New York, New York 10166, for the purposes set forth in the accompanying Notice of Special Meeting of Shareholders. Shareholders of record at the close of business on September 1, 2010 are entitled to receive notice of and to vote at the Meeting.
It is proposed that the Fund transfer all of its assets to Dreyfus Active MidCap Fund (the "Acquiring Fund"), in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund and the assumption by the Acquiring Fund of the Fund's stated liabilities, all as more fully described in this Prospectus/Proxy Statement (the "Reorganization"). Upon consummation of the Reorganization, the Acquiring Fund shares received by the Fund will be distributed to Fund shareholders, with each shareholder receiving a pro rata distribution of the Acquiring Fund's shares (or fractions thereof) for Fund shares held prior to the Reorganization. It is contemplated that each shareholder will receive for his or her Fund shares a number of Class A, Class B, Class C or Class I shares (or fractions thereof) of the Acquiring Fund equal in value to the aggregate net asset value of the shareholder's Class A, Class B, Class C or Class I Fund shares as of the date of the Reorganization. The Acquiring Fund shares received by each Fund shareholder will be of the same share class as the shareholder's Fund shares.
This Prospectus/Proxy Statement, which should be retained for future reference, concisely sets forth information about the Acquiring Fund that Fund shareholders should know before voting on the proposal or investing in the Acquiring Fund.
A Statement of Additional Information ("SAI") dated August __, 2010, relating to this Prospectus/Proxy Statement, has been filed with the Securities and Exchange Commission (the "Commission") and is incorporated by reference in its entirety. The Commission maintains a website (http://www.sec.gov) that contains the SAI, material incorporated in this Prospectus/Proxy Statement by reference, and other information regarding the Acquiring Fund and the Fund. A copy of the SAI is available without charge by calling 1-800-554-4611, or writing to the Acquiring Fund at its offices at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144.
Shares of the Acquiring Fund and the Fund are not bank deposits and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Investing in the Acquiring Fund, as in the Fund, involves certain risks, including the possible loss of principal.
The Securities and Exchange Commission has not approved or disapproved the Acquiring Fund's shares or passed upon the accuracy or adequacy of this Prospectus/Proxy Statement. Any representation to the contrary is a criminal offense.
The Fund and the Acquiring Fund are open-end management investment companies advised by Dreyfus. The funds have substantially similar investment objectives and investment management policies. The Fund seeks long-term capital growth and the Acquiring Fund seeks to maximize capital appreciation. Each fund normally invests primarily in stocks of mid-cap companies. However, each fund uses different investment processes and approaches to select stocks, and the investment limitations of each fund (and the related risks) are not identical. The Acquiring Fund is a series of Strategic Funds, Inc. (the "Acquiring Company"). A comparison of the Fund and the Acquiring Fund is set forth in this Prospectus/Proxy Statement.
The Acquiring Fund's Prospectus dated May 1, 2010, Annual Report for its fiscal year ended December 31, 2009 (including its audited financial statements for the fiscal year) and Semi-Annual Report for the six-month period ended June 30, 2010 accompany this Prospectus/Proxy Statement. The Acquiring Fund's Prospectus and the financial statements contained in its Annual Report are incorporated into this Prospectus/Proxy Statement by reference. For a free copy of the Fund's most recent Prospectus, Annual Report for its fiscal year ended August 31, 2009 and Semi-Annual Report for the six-month period ended February 28, 2010, please call your financial adviser, or call 1-800-554-4611, visit www.dreyfus.com or write to the Fund at its offices located at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144.
Shareholders are entitled to one vote for each Fund share held and fractional votes for each fractional Fund share held. Class A, Class B, Class C and Class I shareholders of the Fund will vote together on the proposal. Fund shares represented by executed and unrevoked proxies will be voted in accordance with the specifications made thereon. If the enclosed proxy card is executed and returned, it nevertheless may be revoked by giving another proxy before the Meeting. Also, any shareholder who attends the Meeting in person may vote by ballot at the Meeting, thereby canceling any proxy previously given. If you sign and date your proxy card, but do not provide voting instructions, your shares will be voted FOR the proposal.
As of July 30, 2010, the following numbers of Fund shares were issued and outstanding:
Class A Shares Outstanding | Class B Shares Outstanding | Class C Shares Outstanding | Class I Shares Outstanding | |||
Proxy materials will be mailed to shareholders of record on or about September 17, 2010.
TABLE OF CONTENTS
Summary | |
Reasons for the Reorganization | |
Information about the Reorganization | |
Additional Information about the Acquiring Fund and the Fund | |
Voting Information | |
Financial Statements and Experts | |
Other Matters | |
Notice To Banks, Broker/Dealers and Voting Trustees and Their Nominees | |
Exhibit A: Agreement and Plan of Reorganization | A-1 |
Exhibit B: Description of the Acquiring Company's Board Members | B-1 |
APPROVAL OF AN AGREEMENT AND PLAN OF REORGANIZATION
PROVIDING FOR THE TRANSFER OF ALL OF THE FUND'S ASSETS
TO THE ACQUIRING FUND
SUMMARY
This Summary is qualified by reference to the more complete information contained elsewhere in this Prospectus/Proxy Statement, the Acquiring Fund's Prospectus, the Fund's Prospectus and the Agreement and Plan of Reorganization (the "Plan") attached to this Prospectus/Proxy Statement as Exhibit A.
Proposed Transaction. The Company's Board, all of whose members are not "interested persons" (as defined in the Investment Company Act of 1940, as amended (the "1940 Act")) of the Fund or the Acquiring Fund, has unanimously approved the Plan for the Fund. The Plan provides that, subject to the requisite approval of the Fund's shareholders, on the date of the Reorganization the Fund will assign, transfer and convey to the Acquiring Fund all of the assets of the Fund, including all securities and cash, in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund having an aggregate net asset value equal to the value of the Fund's net assets, and the Acquiring Fund will assume the Fund's stated liabilities. The Fund will distribute all Acquiring Fund shares received by it among its shareholders so that each Class A, Class B, Class C and Class I Fund shareholder will receive a pro rata distribution of the Acquiring Fund's Class A, Class B, Class C and Class I shares (or fractions thereof) having an aggregate net asset value equal to the aggregate net asset value of the shareholder's Fund shares as of the date of the Reorganization. The Acquiring Fund shares received by each Fund shareholder will be of the same share class as the shareholder's Fund shares. Thereafter, the Fund will cease operations and will be terminated as a series of the Company.
As a result of the Reorganization, each Fund shareholder will cease to be a shareholder of the Fund and will become a shareholder of the Acquiring Fund as of the close of business on the date of the Reorganization. No sales charge, redemption fee or contingent deferred sales charge ("CDSC") will be imposed at the time of the Reorganization. Any subsequent investment in the Acquiring Fund after the Reorganization will be subject to any applicable sales charges, and any redemption of Class B or Class C shares (or Class A shares subject to a CDSC) of the Acquiring Fund received in the Reorganization will be subject to the same CDSC as the redemption of Class B or Class C shares (or Class A shares subject to a CDSC) of the Fund and would be calculated from the date of original purchase of Fund shares.
The Company's Board has unanimously concluded that the Reorganization is in the best interests of the Fund and its shareholders and the interests of the Fund's existing shareholders will not be diluted as a result of the transactions contemplated thereby. See "Reasons for the Reorganization."
Federal Tax Consequences. As a condition to the closing of the Reorganization, the Fund and the Acquiring Fund will receive an opinion of counsel to the effect that, for federal income tax purposes, the Reorganization will qualify as a tax-free reorganization and, thus, no gain or loss will be recognized by the Fund, the Fund's shareholders, or the Acquiring Fund as a result of the Reorganization. Certain tax attributes of the Fund will carry over to the Acquiring Fund, including the ability of the Acquiring Fund to utilize the Fund's capital loss carryforward; however, the ability of the Acquiring Fund to utilize the Fund's capital loss carryforward will be subject to limitations. See "Information about the Reorganization — Federal Income Tax Consequences," " — Capital Loss Carryforward" and " — Sale of Portfolio Securities."
Comparison of the Fund and the Acquiring Fund. The following discussion is primarily a summary of certain parts of the Fund's Prospectus and the Acquiring Fund's Prospectus. Information contained in this Prospectus/Proxy Statement is qualified by the more complete information set forth in such Prospectuses, which are incorporated herein by reference.
Goal and Approach. The Fund and the Acquiring Fund have substantially similar investment objectives and investment management policies. The Fund seeks long-term capital growth and the Acquiring Fund seeks to maximize capital appreciation. Each fund's investment objective is a fundamental policy which cannot be changed without the approval of the holders of a majority (as defined in the 1940 Act) of the relevant fund's outstanding voting securities.
To pursue its goal, the Fund normally invests at least 80% of its assets in the stocks of companies included in the Standard & Poor's® MidCap 400 Index (the "S&P MidCap 400 Index") or the Russell Midcap® Index at the time of purchase. The Fund's portfolio managers select stocks through a "bottom-up," structured approach that seeks to identify undervalued securities using a quantitative screening process. This process is driven by a proprietary quantitative model that measures a diverse set of characteristics of stocks to identify and rank stocks based on:
● | relative value, such as current and forecasted price-to-earnings ratios, yields, dividend discount models, and other price-sensitive data for a stock compared to its past, its peers, and the models' overall stock universe; |
● | momentum and sentiment, meaning measures that reflect the changes in short-term earnings outlook through factors such as revised earnings estimates and earnings surprises; and |
● | earnings quality measures, such as accruals compared to cash earnings, changes in inventory to sales ratio, and return on equity. |
Next, the Fund's portfolio managers construct the portfolio through a risk controlled process, focusing on stock selection as opposed to making proactive decisions as to industry and sector exposure. The Fund's portfolio managers seek to maintain a portfolio that has exposure to industries and market capitalizations that are generally similar to those of the S&P MidCap 400 Index. Finally, within each sector and style subset, the Fund will seek to overweight the most attractive stocks and underweight or not hold the stocks that have been ranked least attractive.
To pursue its goal, the Acquiring Fund normally invests at least 80% of its assets in the stocks of midsize companies. The Acquiring Fund defines "midsize companies" as companies included in the Russell Midcap Index at the time of purchase. The Acquiring Fund may continue to own stocks subsequently removed from the Russell Midcap Index, but would not expect to do so for extended periods due to the application of the portfolio managers' quantitative investment process described below.
The Acquiring Fund's portfolio managers apply a systematic, quantitative investment approach designed to identify and exploit relative misvaluations primarily within mid-cap stocks in the U.S. stock market. The Acquiring Fund's portfolio managers use a proprietary valuation model that identifies and ranks stocks (Composite Alpha Ranking or "CAR") based on:
● | a long-term relative valuation model that utilizes forward looking estimates of risk and return; |
● | an Earnings Sustainability ("ES") model that gauges how well earnings forecasts are likely to reflect changes in future cash flows. Measures of ES help stock selection strategy by tilting the Acquiring Fund's portfolio away from stocks with poor ES and tilting it towards stocks with strong ES; and |
● | a set of Behavioral Factors, including earnings revisions and share buybacks that provide the portfolio managers with information about potential misvaluations of stocks. |
The Acquiring Fund's portfolio managers construct the Acquiring Fund's portfolio through a systematic structured approach, focusing on stock selection as opposed to making proactive decisions as to industry or sector exposure. Within each sector and style subset, the Acquiring Fund overweights the most attractive stocks and underweights or zero weights the stocks that have been ranked least attractive. This approach differs from conventional portfolio management in that, generally, the Acquiring Fund's portfolio managers will strictly adhere to underlying models in selecting portfolio securities. In unusual circumstances, the Acquiring Fund's portfolio managers may deviate from the models.
The Acquiring Fund generally attempts to have a neutral exposure to sectors, industries and capitalizations relative to the Russell Midcap Index. The Acquiring Fund typically will hold between 100 and 250 securities selected using the models. The Acquiring Fund's portfolio managers will periodically rebalance the Acquiring Fund's portfolio, which will result in changes in portfolio holdings. The Acquiring Fund's portfolio managers may enhance the models from time to time, depending on their ongoing research efforts.
The S&P MidCap 400 Index and the Russell Midcap Index are unmanaged indexes designed to measure the performance of the midcap segment of the U.S. stock market. As of March 31, 2010, the market capitalization of the largest company in the S&P MidCap 400 Index was approximately $8.19 billion, and the weighted average and median market capitalizations of the S&P MidCap 400 Index were approximately $3.07 billion and $2.28 billion, respectively. As of March 31, 2010, the market capitalization of the largest company in the Russell Midcap Index was approximately $17.75 billion, and the weighted average and median market capitalizations of the Russell Midcap Index were approximately $6.81 billion and $3.68 billion, respectively.
Each fund's stock investments may include common stocks, preferred stocks and convertible securities of U.S. and foreign issuers, including those purchased in initial public offerings ("IPOs"). The Fund and the Acquiring Fund may, but are not required to, use derivatives, such as options, and, with respect to the Fund only, futures and options on futures (including those relating to securities, indexes and foreign currencies), and forward contracts, as a substitute for investing directly in an underlying asset, to increase returns, to manage currency risk or as part of a hedging strategy. Each fund also may engage in short-selling, typically for hedging purposes, such as to limit exposure to a possible market decline in the value of its portfolio securities. The Fund also may enter into swap agreements and is permitted to engage in leverage through borrowing money to purchase securities.
Neither fund has any limitation regarding portfolio turnover. The Fund and the Acquiring Fund may engage in short-term trading and each fund may have portfolio turnover rates in excess of 100%. A portfolio turnover rate of 100% is equivalent to a fund buying and selling all of the securities in its portfolio once during the course of a year. During its most recent fiscal year, the Fund's and the Acquiring Fund's portfolio turnover rates were 102.59% and 189.84%, respectively, of the average value of the respective fund's portfolio.
The Fund and the Acquiring Fund may lend their respective portfolio securities to brokers, dealers and other financial institutions needing to borrow securities to complete certain transactions. Loans of portfolio securities may not exceed 33-1/3% of the value of a fund's total assets.
Each fund is a "diversified" fund, which means that neither fund will, with respect to 75% of its total assets, invest more than 5% of its assets in the securities of any single issuer nor hold more than 10% of the outstanding voting securities of any single issuer (other than, in each case, securities of other investment companies, and securities issued or guaranteed by the U.S. government, its agencies or instrumentalities).
For more information on the Fund's or the Acquiring Fund's investment management policies, see "Goal and Approach" in the relevant Prospectus and "Description of the Company and Fund[s]" in the relevant Statement of Additional Information.
Investment Risks. The principal risks associated with an investment in the Fund and the Acquiring Fund are substantially similar. These risks are discussed below. An investment in the Acquiring Fund, as well as in the Fund, is not a bank deposit. It is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. It is not a complete investment program. The value of your investment in the Acquiring Fund, as in the Fund, will fluctuate, sometimes dramatically, which means you could lose money.
● | Market risk. The market value of a security may decline due to general market conditions that are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. A security's market value also may decline because of factors that affect a particular industry or industries, such as labor shortages or increased production costs and competitive conditions within an industry. |
● | Issuer risk. The value of a security may decline for a number of reasons which directly relate to the issuer, such as management performance, financial leverage and reduced demand for the issuer's products or services. |
● | Smaller company risk. Investments in small and midsize companies carry additional risks because the operating histories of these companies tend to be more limited, their earnings and revenues less predictable (and some companies may be experiencing significant losses), and their share prices more volatile than those of larger, more established companies. The shares of smaller companies tend to trade less frequently than those of larger, more established companies, which can adversely affect the pricing of these securities and a fund's ability to sell these securities when deemed appropriate. These companies may have limited product lines, markets and/or financial resources, or may depend on a limited management group. Some of the Fund's and Acquiring Fund's investments will rise and fall based on investor perception rather than economic factors. Other investments are made in anticipation of future products, services or events whose delay or cancellation could cause the stock price to drop. |
● | Growth and value stock risk. By investing in a mix of growth and value companies, the funds assume the risks of both. Investors often expect growth companies to increase their earnings at a certain rate. If these expectations are not met, investors can punish the stocks inordinately, even if earnings do increase. In addition, growth stocks typically lack the dividend yield that can cushion stock prices in market downturns. Value stocks involve the risk that they may never reach their expected market value, either because the market fails to recognize the stock's intrinsic worth, or the expected value was misgauged. They also may decline in price even though in theory they are already undervalued. |
● | Foreign investment risk. To the extent the Fund or the Acquiring Fund invests in foreign securities, its performance will be influenced by political, social and economic factors affecting investments in foreign companies. Special risks associated with investments in foreign companies include exposure to currency fluctuations, less liquidity, less developed or less efficient trading markets, lack of comprehensive company information, political and economic instability and differing auditing and legal standards. The securities of issuers located in emerging markets can be more volatile and less liquid than those of issuers in more mature economies. |
● | Foreign currency risk. Investments in foreign currencies are subject to the risk that those currencies will decline in value relative to the U.S. dollar, or, in the case of hedged positions, that the U.S. dollar will decline relative to the currency being hedged. Currency exchange rates may fluctuate significantly over short periods of time. A decline in the value of foreign currencies relative to the U.S. dollar will reduce the value of securities held by the Fund or the Acquiring Fund and denominated in those currencies. Foreign currencies also are subject to risks caused by inflation, interest rates, budget deficits and low savings rates, political factors and government controls. |
In addition to the principal risks described above, the Fund and the Acquiring Fund, except as noted, are subject to the following additional risks. |
● | Derivatives risk. A small investment in derivatives could have a potentially large impact on a fund's performance. The use of derivatives involves risks different from, or possibly greater than, the risks associated with investing directly in the underlying assets. Derivatives can be highly volatile, illiquid and difficult to value, and there is the risk that changes in the value of a derivative held by the Fund or the Acquiring Fund will not correlate with the underlying instruments or the fund's other investments. Derivative instruments also involve the risk that a loss may be sustained as a result of the failure of the counterparty to the derivative instruments to make required payments or otherwise comply with the derivative instruments' terms. Certain types of derivatives involve greater risks than the underlying obligations because, in addition to general market risks, they are subject to illiquidity risk, counterparty risk and credit risk. Additionally, some derivatives involve economic leverage, which could increase the volatility of these investments as they may fluctuate in value more than the underlying instrument. A fund may be required to segregate liquid assets in connection with the purchase of derivative instruments. |
● | Leveraging risk. The use of leverage, such as lending portfolio securities, engaging in forward commitment transactions, entering into forward currency contracts, and, for the Fund only, entering into futures contracts, borrowing money to purchase securities and engaging in reverse repurchase agreements, may magnify the respective fund's gains or losses. |
● | Short sale risk. The Fund and the Acquiring Fund may make short sales, which involves selling a security the fund does not own in anticipation that the security's price will decline. Short sales expose a fund to the risk that it will be required to buy the security sold short (also known as "covering" the short position) at a time when the security has appreciated in value, thus resulting in a loss to the fund. |
● | IPO risk. Although each fund typically invests in seasoned issuers, each fund may purchase securities of companies in IPOs or shortly thereafter. The prices of securities purchased in IPOs can be very volatile. The effect of IPOs on a fund's performance depends on a variety of factors, including the number of IPOs the fund invests in relative to the size of the fund and whether and to what extent a security purchased in an IPO appreciates or depreciates in value. As a fund's asset base increases, IPOs often have a diminished effect on such fund's performance. |
The Fund and the Acquiring Fund may lend their respective portfolio securities to brokers, dealers and other financial institutions. In connection with such loans, the respective fund will receive collateral from the borrower equal to at least 100% of the value of the loaned securities. If the borrower of the securities fails financially, there could be delays in recovering the loaned securities or exercising rights to the collateral.
The Fund and the Acquiring Fund may engage in short-term trading, which could produce higher transaction costs and taxable distributions and lower the respective fund's after-tax performance.
Under adverse market conditions, the Fund and the Acquiring Fund could invest some or all of their respective assets in U.S. Treasury securities and money market securities. Although the Fund or the Acquiring Fund would do this for temporary defensive purposes, this strategy could reduce the benefit from any upswing in the market. To the extent the Fund or the Acquiring Fund invests defensively in these securities, such fund might not achieve its investment objective. Each fund also may purchase money market instruments when it has cash reserves or in anticipation of taking a market position.
See "Investment Risks" in the relevant Prospectus and "Description of the Company and Fund[s]" in the relevant Statement of Additional Information, for a more complete description of investment risks.
Sales Charges. The schedules of sales charges imposed at the time of purchase of Class A shares of the Fund and the Acquiring Fund are identical. The CDSCs imposed at the time of redemption on Class B and Class C shares for the Fund and the Acquiring Fund are identical. Class I shares of each fund are not subject to any sales charges. See in the relevant Prospectus "Shareholder Guide" for a discussion of sales charges and the CDSC. No sales charge or CDSC will be imposed at the time of the Reorganization. Shares of the Fund and the Acquiring Fund currently are not subject to any exchange or redemption fees.
Fees and Expenses. The Acquiring Fund and the Fund have each agreed to pay Dreyfus a management fee at the annual rate of 0.75% of the value of the respective fund's average daily net assets. As of each fund's most recent fiscal year end, each class of shares of the Acquiring Fund, except Class I shares, had a lower total annual expense ratio than the corresponding class of shares of the Fund. If the Reorganization is approved and consummated, it is expected that each class of shares, including Class I shares, of the combined fund will have a lower total annual expense ratio than the corresponding class of shares of the Fund. In addition, Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of Class I shares of the Acquiring Fund, so that the net operating expenses of Class I shares (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed the net operating expenses of Class I shares of the Fund as of the Fund's fiscal year ended August 31, 2009 (i.e., 1.18%). This undertaking is contingent upon the Reorganization being approved and consummated, and will continue in effect until at least January 31, 2012.
The fees and expenses set forth below for the Fund are as of its fiscal year ended August 31, 2009, and for the Acquiring Fund are as of its fiscal year ended December 31, 2009. The "Pro Forma After Reorganization" operating expenses information set forth below is based on the fees and expenses of each fund as of the fiscal year end noted above, as adjusted showing the effect of the Reorganization. Annual fund operating expenses are paid out of fund assets, so their effect is reflected in the share prices.
Fund Class A | Acquiring Fund Class A | Pro Forma After Reorganization Acquiring Fund Class A | ||||
Shareholder fees (fees paid directly from your investment) | ||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | 5.75% | 5.75% | 5.75% | |||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | none1 | none1 | none1 | |||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||
Management fees | 0.75% | 0.75% | 0.75% | |||
Distribution (12b-1) fees | none | none | none | |||
Other expenses (including shareholder services fees) | 0.77% | 0.57% | 0.56% | |||
Total annual fund operating expenses | 1.52% | 1.32%2 | 1.31% |
Fund Class B | Acquiring Fund Class B | Pro Forma After Reorganization Acquiring Fund Class B | ||||
Shareholder fees (fees paid directly from your investment) | ||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | |||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | 4.00% | 4.00% | 4.00% | |||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||
Management fees | 0.75% | 0.75% | 0.75% | |||
Distribution (12b-1) fees | 0.75% | 0.75% | 0.75% | |||
Other expenses (including shareholder services fees) | 0.84% | 0.74% | 0.72% | |||
Total annual fund operating expenses | 2.34% | 2.24%2 | 2.22% |
Fund Class C | Acquiring Fund Class C | Pro Forma After Reorganization Acquiring Fund Class C | ||||
Shareholder fees (fees paid directly from your investment) | ||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | |||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | 1.00% | 1.00% | 1.00% | |||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||
Management fees | 0.75% | 0.75% | 0.75% | |||
Distribution (12b-1) fees | 0.75% | 0.75% | 0.75% | |||
Other expenses (including shareholder services fees) | 0.73% | 0.64% | 0.61% | |||
Total annual fund operating expenses | 2.23% | 2.14%2 | 2.11% |
Fund Class I | Acquiring Fund Class I | Pro Forma After Reorganization Acquiring Fund Class I | ||||
Shareholder fees (fees paid directly from your investment) | ||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | |||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | none | none | none | |||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||
Management fees | 0.75% | 0.75% | 0.75% | |||
Distribution (12b-1) fees | none | none | none | |||
Other expenses (including shareholder services fees) | 0.43% | 0.86% | 0.35% | |||
Total annual fund operating expenses | 1.18% | 1.61%2 | 1.10%3 |
_____________________
1 Shares bought without an initial sales charge as part of an investment of $1 million or more may be charged a CDSC of 1.00% if redeemed within one year.
2 Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Acquiring Fund for the period June 1, 2010 through November 30, 2010, so that the direct expenses of Class A, Class B, Class C and Class I shares of the Acquiring Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 1.50%, 2.25%, 2.25% and 1.25%, respectively.
3 If the Reorganization is approved and consummated, Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Acquiring Fund's Class I shares until at least January 31, 2012, so that the net operating expenses of Class I shares of the Acquiring Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed the net operating expenses of the Fund's Class I shares as of the Fund's fiscal year ended August 31, 2009 (i.e., 1.18%).
Shareholders of another fund advised by Dreyfus — Dreyfus S&P STARS Opportunities Fund ("STARS Opportunities Fund") — also are being asked in separate proxy materials directed to them to approve an Agreement and Plan of Reorganization providing for the transfer of all of the STARS Opportunities Fund's assets, subject to its liabilities, to the Acquiring Fund in exchange for shares of the Acquiring Fund. If approved by the Fund's shareholders, the Reorganization will be consummated for the Fund whether or not the shareholders of the STARS Opportunities Fund approve the reorganization of the STARS Opportunities Fund and the Acquiring Fund. The fees and expenses set forth below assume that shareholders of the Fund and of the STARS Opportunities Fund approve the reorganizations of their respective funds into the Acquiring Fund. The fees and expenses set forth below for the Fund, the STARS Opportunities Fund and the Acquiring Fund are as of their most recent fiscal year end (March 31, 2010 for the STARS Opportunities Fund). The "Pro Forma After Reorganizations" operating expenses information set forth below is based on the fees and expenses of each fund as of the fiscal year end noted above, as adjusted showing the effect of the reorganizations.
Fund Class A | STARS Opportunities Fund Class A | Acquiring Fund Class A | Pro Forma After Reorganizations Acquiring Fund Class A | |||||
Shareholder fees (fees paid directly from your investment) | ||||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | 5.75% | 5.75% | 5.75% | 5.75% | ||||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | none1 | none1 | none1 | none1 | ||||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||||
Management fees | 0.75% | 0.70% | 0.75% | 0.75% | ||||
Distribution (12b-1) fees | none | none | none | none | ||||
Other expenses (including shareholder services fees) | 0.77% | 0.82%2 | 0.57% | 0.55% | ||||
Total annual fund operating expenses | 1.52% | 1.52% | 1.32% | 1.30% | ||||
Fee waiver and/or expense reimbursement | N/A | (0.22)%3 | N/A4 | N/A5 | ||||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 1.52% | 1.30% | 1.32% | 1.30% |
Fund Class B | STARS Opportunities Fund Class B | Acquiring Fund Class B | Pro Forma After Reorganizations Acquiring Fund Class B | |||||
Shareholder fees (fees paid directly from your investment) | ||||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | none | ||||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | 4.00% | 4.00% | 4.00% | 4.00% | ||||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||||
Management fees | 0.75% | 0.70% | 0.75% | 0.75% | ||||
Distribution (12b-1) fees | 0.75% | 0.75% | 0.75% | 0.75% | ||||
Other expenses (including shareholder services fees) | 0.84% | 0.95%2 | 0.74% | 0.71% | ||||
Total annual fund operating expenses | 2.34% | 2.40% | 2.24% | 2.21% | ||||
Fee waiver and/or expense reimbursement | N/A | (0.35)%3 | N/A4 | (0.16)%5 | ||||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 2.34% | 2.05% | 2.24% | 2.05% |
Fund Class C | STARS Opportunities Fund Class C | Acquiring Fund Class C | Pro Forma After Reorganizations Acquiring Fund Class C | |||||
Shareholder fees (fees paid directly from your investment) | ||||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | none | ||||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | 1.00% | 1.00% | 1.00% | 1.00% | ||||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||||
Management fees | 0.75% | 0.70% | 0.75% | 0.75% | ||||
Distribution (12b-1) fees | 0.75% | 0.75% | 0.75% | 0.75% | ||||
Other expenses (including shareholder services fees) | 0.73% | 0.76%2 | 0.64% | 0.56% | ||||
Total annual fund operating expenses | 2.23% | 2.21% | 2.14% | 2.06% | ||||
Fee waiver and/or expense reimbursement | N/A | (0.16)%3 | N/A4 | (0.01)%5 | ||||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 2.23% | 2.05% | 2.14% | 2.05% |
Fund Class I | STARS Opportunities Fund Class I | Acquiring Fund Class I | Pro Forma After Reorganizations Acquiring Fund Class I | |||||
Shareholder fees (fees paid directly from your investment) | ||||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | none | ||||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | none | none | none | none | ||||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||||
Management fees | 0.75% | 0.70% | 0.75% | 0.75% | ||||
Distribution (12b-1) fees | none | none | none | none | ||||
Other expenses (including shareholder services fees) | 0.43% | 0.62%2 | 0.86% | 0.36% | ||||
Total annual fund operating expenses | 1.18% | 1.32% | 1.61% | 1.11% | ||||
Fee waiver and/or expense reimbursement | N/A | (0.27)%3 | N/A4 | (0.06)%5 | ||||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 1.18% | 1.05% | 1.61% | 1.05% |
____________
1 Shares bought without an initial sales charge as part of an investment of $1 million or more may be charged a CDSC of 1.00% if redeemed within one year.
2 "Other expenses" for the STARS Opportunities Fund include an annual 0.15% licensing fee payable by the STARS Opportunities Fund to Standard & Poor's for the use of certain of Standard & Poor's proprietary tradenames and trademarks, pursuant to a license agreement between Dreyfus and Standard & Poor's. The license agreement will be terminated if the reorganization of the STARS Opportunities Fund is approved and consummated.
3 Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the STARS Opportunities Fund until at least August 1, 2011, so that the direct expenses of Class A, Class B, Class C and Class I shares of the STARS Opportunities Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 1.30%, 2.05%, 2.05% and 1.05%, respectively.
4 Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Acquiring Fund for the period June 1, 2010 through November 30, 2010, so that the direct expenses of Class A, Class B, Class C and Class I shares of the Acquiring Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 1.50%, 2.25%, 2.25% and 1.25%, respectively.
5 If the reorganization of the STARS Opportunities Fund is approved and consummated, Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Acquiring Fund until at least January 31, 2012, so that the net operating expenses of Class A, Class B, Class C and Class I shares of the Acquiring Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed the net operating expenses of the corresponding class of shares of the STARS Opportunities Fund as of the STARS Opportunities Fund's fiscal year ended March 31, 2010 (i.e., 1.30%, 2.05%, 2.05% and 1.05%, respectively).
Examples
The Examples below are intended to help you compare the cost of investing in the Fund and the Acquiring Fund. The first "Pro Forma After Reorganization" Example below shows the Reorganization of the Fund and the Acquiring Fund and the second "Pro Forma After Reorganizations" Example below shows the reorganizations of the Fund, the STARS Opportunities Fund and the Acquiring Fund. Each Example assumes you invest $10,000 in the respective fund for the time periods indicated. Each Example also assumes that your investment has a 5% return each year and that the respective fund's operating expenses remain the same. The "Pro Forma After Reorganization(s)" Examples are based on the operating expenses of the funds, as of the respective fiscal year ends noted above, as adjusted showing the effect of the reorganizations. The one-year and the first year of the three-, five- and ten-years for the second "Pro Forma After Reorganizations" Examples below are based on net operating expenses, which reflect any expense waiver/reimbursement arrangements by Dreyfus. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
Fund | ||||
Class A Shares | Class B Shares * | Class C Shares * | Class I Shares | |
1 Year | $721 | $637/$237 | $326/$226 | $120 |
3 Years | $1,028 | $1,030/$730 | $697/$697 | $375 |
5 Years | $1,356 | $1,450/$1,250 | $1,195/$1,195 | $649 |
10 Years | $2,283 | $2,283/$2,283** | $2,565/$2,565 | $1,432 |
Acquiring Fund | ||||
Class A Shares | Class B Shares * | Class C Shares * | Class I Shares | |
1 Year | $702 | $627/$227 | $317/$217 | $164 |
3 Years | $969 | $1,000/$700 | $670/$670 | $508 |
5 Years | $1,257 | $1,400/$1,200 | $1,149/$1,149 | $876 |
10 Years | $2,074 | $2,129/$2,129** | $2,472/$2,472 | $1,911 |
Pro Forma After Reorganization—Fund and Acquiring Fund Acquiring Fund Shares | ||||
Class A Shares | Class B Shares * | Class C Shares * | Class I Shares | |
1 Year | $701 | $625/$225 | $314/$214 | $112 |
3 Years | $966 | $994/$694 | $661/$661 | $350 |
5 Years | $1,252 | $1,390/$1,190 | $1,134/$1,134 | $606 |
10 Years | $2,063 | $2,113/$2,113** | $2,441/$2,441 | $1,340 |
Pro Forma After Reorganizations—Fund, STARS Opportunities Fund and Acquiring Fund Acquiring Fund Shares | ||||
Class A Shares | Class B Shares * | Class C Shares * | Class I Shares | |
1 Year | $700 | $608/$208 | $308/$208 | $107 |
3 Years | $963 | $976/$676 | $645/$645 | $347 |
5 Years | $1,247 | $1,370/$1,170 | $1,108/$1,108 | $606 |
10 Years | $2,053 | $2,089/$2,089** | $2,389/$2,389 | $1,346 |
___________________________
* With redemption/without redemption.
** Assumes conversion of Class B shares to Class A shares at the end of the sixth year following the date of purchase.
Past Performance. The bar charts and tables below illustrate the risks of investing in the Acquiring Fund and the Fund. The bar chart for the Acquiring Fund shows the changes in the performance of the Acquiring Fund's Class A shares from year to year and the bar chart for the Fund shows the changes in the performance of the Fund's Class A shares from year to year. The table for each fund compares the average annual total returns of the respective fund's shares to those of broad measures of market performance. Sales charges, if any, are not reflected in the bar chart, and if those charges were included, returns would have been less than those shown. Past performance (before and after taxes) is no guarantee of future results. More recent performance information may be available at www.dreyfus.com.
After-tax performance is shown only for Class A shares of the Acquiring Fund and the Fund. After-tax performance of each fund's other share classes will vary. After-tax returns are calculated using the historical highest individual federal marginal income tax rates, and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor's tax situation and may differ from those shown, and the after-tax returns shown are not relevant to investors who hold their shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts.
Acquiring Fund — Class A Shares
Year-by-year total returns as of 12/31 each year (%)
+8.60 | -9.56 | -11.55 | +31.68 | +15.33 | +14.40 | +13.56 | -4.76 | -44.73 | +35.24 |
'00 | '01 | '02 | '03 | '04 | '05 | '06 | '07 | '08 | '09 |
Best Quarter: | Q2 '09 | +20.71% |
Worst Quarter: | Q4 '08 | -28.18% |
The year-to-date total return of the Acquiring Fund's Class A shares as of 6/30/10 was –3.56%.
Acquiring Fund Shares
Average annual total returns as of 12/31/09
Share Class (inception date) | 1 Year | 5 Years | 10 Years |
Class A (1/29/85) returns before taxes | 27.48% | -2.71% | 1.41% |
Class A returns after taxes on distributions | 27.34% | -3.81% | 0.00% |
Class A returns after taxes on distributions and sale of fund shares | 18.05% | -2.07% | 1.03% |
Class B (11/27/02)* returns before taxes | 30.05% | -2.62% | 1.77%** |
Class C (11/27/02)* returns before taxes | 33.13% | -2.31% | 1.47% |
Class I (11/27/02)* returns before taxes | 35.01% | -1.66% | 2.01% |
Russell Midcap Index reflects no deduction for fees, expenses or taxes | 40.48% | 2.43% | 4.98% |
S&P MidCap 400 Index reflects no deduction for fees, expenses or taxes | 37.38% | 3.27% | 6.36% |
_______________________________
* For the Acquiring Fund's Class B, Class C and Class I shares, periods prior to inception date reflect the performance of the Acquiring Fund's Class A shares, adjusted to reflect applicable sales charges. Such performance figures have not been adjusted, however, to reflect applicable fees and expenses; if such fees and expenses were reflected, the performance shown for Class B and Class C shares of the Acquiring Fund would have been lower.
** Assumes conversion of Class B shares to Class A shares at the end of the sixth year following the date of purchase.
Fund—Class A Shares
Year-by-year total returns as of 12/31 each year (%)
-10.74 | +34.02 | +19.31 | +10.03 | +13.00 | +2.58 | -40.57 | +35.17 |
'02 | '03 | '04 | '05 | '06 | '07 | '08 | '09 |
Best Quarter: | Q3 '09 | +17.90% |
Worst Quarter: | Q4 '08 | -27.25% |
The year-to-date total return of the Fund's Class A shares as of 6/30/10 was –0.99%.
Fund Shares
Average annual total returns as of 12/31/09
Share Class (inception date) | 1 Year | 5 Years | Since Inception |
Class A (6/29/01) returns before taxes | 27.35% | -0.70% | 3.38% |
Class A returns after taxes on distributions | 27.29% | -1.17% | 3.02% |
Class A returns after taxes on distributions and sale of fund shares | 17.86% | -0.65% | 2.86% |
Class B (6/29/01) returns before taxes | 30.03% | -0.70% | 3.52%* |
Class C (6/29/01) returns before taxes | 33.28% | -0.28% | 3.30% |
Class I (6/29/01) returns before taxes | 35.64% | -0.66% | 4.32% |
Russell Midcap Index reflects no deduction for fees, expenses or taxes | 40.48% | 2.43% | 5.15% |
S&P MidCap 400 Index reflects no deduction for fees, expenses or taxes | 37.38% | 3.27% | 5.38% |
* Assumes conversion of Class B shares to Class A shares at the end of the sixth year following the date of purchase.
Investment Adviser. The investment adviser for the Fund and the Acquiring Fund is Dreyfus, located at 200 Park Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages approximately $273 billion in approximately 193 mutual fund portfolios. A discussion regarding the basis for the Acquiring Company's Board approving the Acquiring Fund's management agreement with Dreyfus is available in the Acquiring Fund's Annual Report for the fiscal year ended December 31, 2009. Dreyfus is the primary mutual fund business of The Bank of New York Mellon Corporation ("BNY Mellon"), a global financial services company focused on helping clients move and manage their financial assets, operating in 34 countries and serving more than 100 markets. BNY Mellon is a leading provider of financial services for institutions, corporations and high-net-worth individuals, providing asset and wealth management, asset servicing, issuer services, and treasury services through a worldwide client-focused team. BNY Mellon has more than $22.3 trillion in assets under custody and administration and $1.1 trillion in assets under management, and it services more than $12 trillion in outstanding debt. Additional information is available at www.bnymellon.com.
Dreyfus has engaged its affiliate, Mellon Capital Management Corporation ("Mellon Capital"), located at 50 Fremont Street, Suite 3900, San Francisco, California 94105, to serve as the Fund's sub-investment adviser. Mellon Capital provides investment advisory assistance and research and the day-to-day management of the Fund's investments, subject to Dreyfus' supervision and approval. As of June 30, 2010, Mellon Capital managed approximately $170.6 billion in assets. Franklin Portfolio Associates LLC ("FPA"), the Fund's former sub-investment adviser, merged into Mellon Capital on January 1, 2009.
Primary Portfolio Managers. The Fund and the Acquiring Fund have different primary portfolio managers. Oliver Buckley, Michael Dunn and Patrick Slattery have been the Fund's primary portfolio managers since July 2007. Since January 1, 2009, Mr. Buckley has been an Executive Vice President with Mellon Capital. From September 2000 through December 2008, Mr. Buckley served in various capacities with FPA, including Chief Executive Officer, senior vice president and senior portfolio manager. Since January 1, 2009, Mr. Dunn has been a Director with Mellon Capital. From October 1999 through December 2008, he was an employee of FPA serving in various capacities, including senior portfolio manager. Since January 1, 2009, Mr. Slattery has been a senior portfolio manager of Mellon Capital. From 2005 through December 2008, Mr. Slattery was a vice president and portfolio manager for FPA. Prior to joining FPA, Mr. Slattery was a senior vice president at Independence Investment LLC where he was a portfolio manager and quantitative researcher.
Warren Chiang, CFA, and C. Wesley Boggs serve as the primary portfolio managers of the Acquiring Fund, positions they have held since February 2009. Mr. Chiang is managing director and head of active equity strategies at Mellon Capital, where he has been employed since 1997. Mr. Boggs is a vice president and senior portfolio manager at Mellon Capital, where he has been employed since 1993. Messrs. Chiang and Boggs have been employed by Dreyfus since September 2007. Messrs. Chiang and Boggs will manage the combined fund if the Reorganization is approved and consummated.
Board Members. Other than Joseph S. DiMartino, who is Chairman of the Board of the Acquiring Company and the Company, and Ehud Houminer, who is a member of the Boards of the Acquiring Company and the Company, the Acquiring Company and the Company have different Board members. None of the Board members of the Acquiring Company or the Company is an "interested person" (as defined in the 1940 Act) of the Fund or the Acquiring Fund ("Independent Board Members"). For a description of the Acquiring Company's Board members, see Exhibit B.
Independent Registered Public Accounting Firm. Ernst & Young LLP is the independent registered public accounting firm for the Fund and the Acquiring Fund.
Capitalization. The Fund and the Acquiring Fund have classified their respective shares into four classes – Class A, Class B, Class C and Class I. The following tables set forth, as of December 31, 2009, (1) the capitalization of each class of the Fund's shares, (2) the capitalization of each class of the Acquiring Fund's shares and (3) the pro forma capitalization of each class of the Acquiring Fund's shares, as adjusted showing the effect of the Reorganization had it occurred on such date.
Fund Class A | Acquiring Fund Class A | Adjustments | Pro Forma After Reorganization Acquiring Fund Class A | ||||
Total net assets | $45,338,606 | $445,290,042 | $490,628,648 | ||||
Net asset value per share | $15.13 | $28.02 | $28.02 | ||||
Shares outstanding | 2,997,235 | 15,889,262 | 1,618,421* | 17,507,683 |
Fund Class B | Acquiring Fund Class B | Adjustments | Pro Forma After Reorganization Acquiring Fund Class B | ||||
Total net assets | $2,018,065 | $4,928,774 | $6,946,839 | ||||
Net asset value per share | $14.22 | $26.85 | $26.85 | ||||
Shares outstanding | 141,958 | 183,579 | 75,182* | 258,761 |
Fund Class C | Acquiring Fund Class C | Adjustments | Pro Forma After Reorganization Acquiring Fund Class C | ||||
Total net assets | $11,655,979 | $8,407,308 | $20,063,287 | ||||
Net asset value per share | $14.26 | $26.91 | $26.91 | ||||
Shares outstanding | 817,489 | 312,423 | 433,199* | 745,622 |
Fund Class I | Acquiring Fund Class I | Adjustments | Pro Forma After Reorganization Acquiring Fund Class I | ||||
Total net assets | $52,437,067 | $4,112,066 | $56,549,133 | ||||
Net asset value per share | $15.29 | $28.36 | $28.36 | ||||
Shares outstanding | 3,430,019 | 145,003 | 1,849,259* | 1,994,262 |
_______________________
* Adjustment to reflect the exchange of shares outstanding from the Fund to the Acquiring Fund.
The Fund's total net assets (attributable to Class A, Class B, Class C and Class I shares) and the Acquiring Fund's total net assets (attributable to Class A, Class B, Class C and Class I shares), as of December 31, 2009, were $111,449,717 and $462,738,190, respectively. Each share has one vote. Shares have no preemptive or subscription rights and are freely transferable. All share classes of a fund invest in the same portfolio of securities, but the classes are subject to different charges and expenses and will likely have different share prices.
Shareholders of the STARS Opportunities Fund also are being asked in proxy materials directed to them to approve a separate Agreement and Plan of Reorganization providing for the transfer of all of such fund's assets, subject to liabilities, to the Acquiring Fund in exchange for Acquiring Fund shares. As of December 31 ,2009, the STARS Opportunities Fund had total net assets (attributable to Class A, Class B, Class C and Class I shares) of $205,481,489. If approved by the Fund's shareholders, the Reorganization will be consummated for the Fund whether or not the shareholders of the STARS Opportunities Fund approve the reorganization of that fund with the Acquiring Fund.
Purchase Procedures. The purchase procedures of the Fund and the Acquiring Fund and the automatic investment services they offer are the same. See the relevant fund's Prospectus and Statement of Additional Information for a discussion of purchase procedures.
Distribution (12b-1) Plans. Class B and Class C shares of the Fund and the Acquiring Fund are subject to plans adopted pursuant to Rule 12b-1 under the 1940 Act (each, a "Rule 12b-1 Plan"). Under the respective Rule 12b-1 Plan, the Fund and the Acquiring Fund pay MBSC Securities Corporation ("MBSC"), their distributor, a fee at an annual rate of 0.75% of the value of the average daily net assets of their respective Class B and Class C shares to finance the sale and distribution of such shares. There is no Rule 12b-1 Plan fee for Class A or Class I shares of either fund. Because Rule 12b-1 Plan fees are paid out of the assets attributable to the relevant class of shares on an ongoing basis, over time they will increase the cost of your investment in such class of shares and may cost you more than paying other types of sales charges. See "Distribution Plan and Shareholder Services Plan—Distribution Plan" in each fund's Statement of Additional Information for a discussion of the respective Rule 12b-1 Plan.
Shareholder Services Plan. Class A, Class B and Class C shares of the Fund and the Acquiring Fund are subject to a Shareholder Services Plan pursuant to which the Fund and the Acquiring Fund pay MBSC a fee at an annual rate of 0.25% of the value of the average daily net assets of their respective Class A, Class B and Class C shares for providing shareholder services and/or maintaining shareholder accounts. There is no Shareholder Services Plan fee for Class I shares of either fund. See "Distribution Plan and Shareholder Services Plan—Shareholder Services Plan" in each fund's Statement of Additional Information for a discussion of the respective Shareholder Services Plan.
Redemption Procedures. The redemption procedures of the Fund and the Acquiring Fund are the same. See the relevant fund's Prospectus and Statement of Additional Information for a discussion of redemption procedures.
Distributions. The dividends and distributions policies of the Fund and the Acquiring Fund are identical. Each fund anticipates paying its shareholders any dividends and capital gain distributions annually, but each fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code of 1986, as amended (the "Code"), in all events in a manner consistent with the provisions of the 1940 Act. The actual amount of dividends paid per share by the Fund and the Acquiring Fund is different. See "Distributions and Taxes" in the relevant Prospectus for a discussion of such policies.
Shareholder Services. The shareholder services offered by the Fund and the Acquiring Fund are the same. The privileges you currently have on your Fund account will transfer automatically to your account with the Acquiring Fund. See "Services for Fund Investors" in the relevant Prospectus and "Shareholder Services" in the relevant Statement of Additional Information for a further discussion of the shareholder services offered.
REASONS FOR THE REORGANIZATION
After management of Dreyfus reviewed the funds in the Dreyfus Family of Funds to determine whether it would be appropriate to consolidate certain funds having similar investment objectives and investment management policies and that would otherwise benefit fund shareholders, management recommended to the Company's Board and to the Acquiring Company's Board that the Fund be consolidated with the Acquiring Fund. The Company's Board and the Acquiring Company's Board have concluded, with respect to the Fund and the Acquiring Fund, respectively, that the Reorganization is in the best interests of the Fund and its shareholders and the Acquiring Fund and its shareholders, respectively. In reaching this conclusion, the Company's Board of Directors determined that reorganizing the Fund into the Acquiring Fund, which also is managed by Dreyfus and has a substantially similar investment objective and substantially similar investment management policies as those of the Fund, offers potential benefits to Fund shareholders. The Company's Board believes that the Reorganization will permit Fund shareholders to pursue substantially similar investment goals in a larger combined fund that is expected to have a lower total expense ratio than the Fund, without diluting such shareholders' interests. As of December 31, 2009, the Fund had net assets of approximately $111 million and the Acquiring Fund had net assets of approximately $463 million. By combining the Fund with the Acquiring Fund, Fund shareholders should benefit from more efficient portfolio management and Dreyfus should be able to eliminate the duplication of resources and costs associated with marketing and servicing the funds as separate entities.
The Acquiring Company's Board considered that the Reorganization presents an opportunity for the Acquiring Fund to acquire substantial investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Acquiring Fund.
In determining whether to recommend approval of the Reorganization, each Board considered the following factors, among others: (1) the compatibility of the Fund's and the Acquiring Fund's investment objectives, management policies and restrictions, as well as shareholder services offered by the Fund and the Acquiring Fund; (2) the terms and conditions of the Reorganization and whether the Reorganization would result in dilution of shareholder interests; (3) information regarding the fees and expenses, including the net expense ratios, of the Fund and the Acquiring Fund, as well as the estimated expense ratio of the combined fund; (4) the relative performance of the Fund and the Acquiring Fund; (5) the tax consequences of the Reorganization; and (6) that the costs to be incurred by the Fund and the Acquiring Fund in connection with the Reorganization would be borne by Dreyfus and not the Fund or the Acquiring Fund.
For the reasons described above, the Company's Board and the Acquiring Company's Board, each of which is comprised entirely of Independent Board Members, approved the Reorganization.
INFORMATION ABOUT THE REORGANIZATION
Plan of Reorganization. The following summary of the Plan is qualified in its entirety by reference to the Plan attached to this Prospectus/Proxy Statement as Exhibit A. The Plan provides that, subject to the requisite approval of the Fund's shareholders, the Acquiring Fund will acquire all of the assets of the Fund in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund and the assumption by the Acquiring Fund of the Fund's stated liabilities on January 20, 2011 or such other date as may be agreed upon by the parties (the "Closing Date"). The number of Class A, Class B, Class C and Class I shares of the Acquiring Fund to be issued to the Fund will be determined on the basis of the relative net asset values per share and aggregate net assets of the corresponding class of shares of the Fund and the Acquiring Fund, generally computed as of the close of trading on the floor of the New York Stock Exchange (usually at 4:00 p.m., Eastern time) on the Closing Date. Portfolio securities of the Fund and the Acquiring Fund will be valued in accordance with the valuation practices of the Acquiring Fund, which are the same as those of the Fund and are described under the caption "Shareholder Guide—Buying and Selling Shares" in the Acquiring Fund's Prospectus and under the caption "Determination of Net Asset Value" in the Acquiring Fund's Statement of Additional Information.
On or before the Closing Date, the Fund will declare a dividend or dividends which, together with all previous dividends, will have the effect of distributing to Fund shareholders all of the Fund's previously undistributed investment company taxable income, if any, for the tax periods ending on or before the Closing Date (computed without regard to any deduction for dividends paid), its net exempt interest income for the tax periods ending on or before the Closing Date, and all of its previously undistributed net capital gain, if any, realized in the tax periods ending on or before the Closing Date (after reduction for any capital loss carryforward). Any such distribution will be taxable to Fund shareholders.
As soon as conveniently practicable after the Closing Date, the Fund will liquidate and distribute pro rata to its Class A, Class B, Class C and Class I shareholders of record, as of the close of business on the Closing Date, the Acquiring Fund Class A, Class B, Class C and Class I shares received by it in the Reorganization. Such liquidation and distribution will be accomplished by establishing accounts on the share records of the Acquiring Fund in the name of each Fund shareholder, each account being credited with the respective pro rata number of Acquiring Fund shares due to the shareholder. The Acquiring Fund shares received by each Fund shareholder will be of the same share class as the shareholder's Fund shares. After such distribution and the winding up of its affairs, the Fund will cease operations and will be terminated as a series of the Company. After the Closing Date, any outstanding certificates representing Fund shares will be canceled and the Acquiring Fund shares distributed to the Fund's shareholders of record will be reflected on the books of the Acquiring Fund as uncertificated, book-entry shares.
The Plan may be amended at any time prior to the Reorganization. The Fund will provide its shareholders with information describing any material amendment to the Plan prior to shareholder consideration. The obligations of the Company, on behalf of the Fund, and the Acquiring Company, on behalf of the Acquiring Fund, under the Plan are subject to various conditions, including approval by Fund shareholders holding the requisite number of Fund shares and the continuing accuracy of various representations and warranties of the Company, on behalf of the Fund, and the Acquiring Company, on behalf of the Acquiring Fund.
The total expenses of the Reorganization are expected to be approximately $100,000, which will be borne by Dreyfus. In addition to use of the mails, proxies may be solicited personally or by telephone, and Dreyfus may pay persons holding Fund shares in their names or those of their nominees for their expenses in sending soliciting materials to their principals. In addition, an outside firm may be retained to solicit proxies on behalf of the Company's Board. The cost of any such outside solicitation firm, which would be borne by Dreyfus, is estimated to be approximately $8,000, which amount is included in the estimated total expenses of the Reorganization listed above. The funds, however, will bear their respective portfolio transaction costs whether or not associated with the Reorganization.
By approving the Reorganization, Fund shareholders also are, in effect, agreeing to the Acquiring Fund's investment objective and policies, investment advisory and distribution arrangements, Board composition, and independent registered public accounting firm. If the Reorganization is not approved by Fund shareholders, the Company's Board will consider other appropriate courses of action with respect to the Fund.
Temporary Suspension of Certain of the Fund's Investment Restrictions. Since certain of the Fund's existing investment restrictions could preclude the Fund from consummating the Reorganization in the manner contemplated in the Plan, Fund shareholders are requested to authorize the temporary suspension of any investment restriction of the Fund to the extent necessary to permit the consummation of the Reorganization. The temporary suspension of any of the Fund's investment restrictions will not affect the investment restrictions of the Acquiring Fund. A vote in favor of the proposal is deemed to be a vote in favor of the temporary suspension.
Federal Income Tax Consequences. The exchange of Fund assets for Acquiring Fund Class A, Class B, Class C and Class I shares, the Acquiring Fund's assumption of the Fund's stated liabilities, and the Fund's distribution of those shares to Fund shareholders are intended to qualify for federal income tax purposes as a tax-free reorganization under Section 368(a) of the Code. As a condition to the closing of the Reorganization, the Fund and the Acquiring Fund will receive the opinion of Stroock & Stroock & Lavan LLP, counsel to the Fund, the Acquiring Fund and the Independent Board Members, to the effect that, on the basis of the existing provisions of the Code, Treasury regulations issued thereunder, current administrative regulations and pronouncements and court decisions, and certain facts, assumptions and representations, for federal income tax purposes: (1) the transfer of all of the Fund's assets to the Acquiring Fund in exchange solely for Acquiring Fund Class A, Class B, Class C and Class I shares and the assumption by the Acquiring Fund of the Fund's stated liabilities, followed by the distribution by the Fund of those Acquiring Fund Class A, Class B, Class C and Class I shares pro rata to Fund shareholders in complete liquidation of the Fund, will qualify as a "reorganization" within the meaning of Section 368(a) of the Code, and each of the Fund and the Acquiring Fund will be "a party to a reorganization"; (2) no gain or loss will be recognized by the Acquiring Fund upon the receipt of the assets of the Fund in exchange solely for Acquiring Fund Class A, Class B, Class C and Class I shares and the assumption by the Acquiring Fund of stated liabilities of the Fund pursuant to the Reorganization; (3) no gain or loss will be recognized by the Fund upon the transfer of its assets to the Acquiring Fund in exchange solely for Acquiring Fund Class A, Class B, Class C and Class I shares and the assumption by the Acquiring Fund of stated liabilities of the Fund or upon the distribution (whether actual or constructive) of those Acquiring Fund Class A, Class B, Class C and Class I shares to Fund shareholders in exchange for their shares of the Fund in liquidation of the Fund pursuant to the Reorganization; (4) no gain or loss will be recognized by Fund shareholders upon the exchange of their Fund Class A, Class B, Class C and Class I shares for Acquiring Fund Class A, Class B, Class C and Class I shares pursuant to the Reorganization; (5) the aggregate tax basis for the Acquiring Fund Class A, Class B, Class C and Class I shares received by each Fund shareholder pursuant to the Reorganization will be the same as the aggregate tax basis for the Fund shares held by such shareholder immediately prior to the Reorganization, and the holding period of those Acquiring Fund Class A, Class B, Class C and Class I shares received by each Fund shareholder will include the period during which the Fund shares exchanged therefor were held by such shareholder (provided the Fund shares were held as capital assets on the date of the Reorganization); and (6) the tax basis of each Fund asset acquired by the Acquiring Fund will be the same as the tax basis of such asset to the Fund immediately prior to the Reorganization, and the holding period of each Fund asset in the hands of the Acquiring Fund will include the period during which that asset was held by the Fund.
The Fund and the Acquiring Fund have not sought a tax ruling from the Internal Revenue Service ("IRS"). The opinion of counsel is not binding on the IRS, nor does it preclude the IRS from adopting a contrary position. Fund shareholders should consult their tax advisers regarding the effect, if any, of the Reorganization in light of their individual circumstances. Because the foregoing discussion relates only to the federal income tax consequences of the Reorganization, Fund shareholders also should consult their tax advisers as to state and local tax consequences, if any, of the Reorganization.
Capital Loss Carryforward. As of the Fund's fiscal year ended August 31, 2009, the Fund had an unused capital loss carryforward of approximately $17.4 million. There are limitations to the amount of the carryforward that can be utilized in any one year, and any amount that cannot be utilized in any one year can be carried over to a succeeding year subject to the same limitations in such year. Different amounts of the capital loss carryforward expire in different years. The Reorganization would impose further limitations on the amount of the carryforward that could be utilized and carried over to succeeding years. Consequently, as a result of the limitations on the use of the capital loss carryforward, if the Reorganization is consummated it is expected that some of the Fund's capital loss carryforward will expire unused.
Sale of Portfolio Securities. Certain of the portfolio securities currently held by the Fund are expected to be sold after the consummation of the Reorganization, subject to any restrictions imposed by the Code. The tax impact of the sale of such portfolio securities will depend on the difference between the price at which such securities are sold and the combined fund's tax basis in such securities. Any capital gains recognized as a result of these sales on a net basis, after the application of any available capital loss carryforward, will be distributed to the combined fund's shareholders and such distributions will be taxable to such shareholders. As of the date hereof, the combined fund is not expected to recognize material capital gains as a result of the sale of certain of the Fund's portfolio securities acquired in connection with the Reorganization. The transaction costs associated with the sale of such Fund securities will be borne by the combined fund. The Fund and the Acquiring Fund also may buy and sell securities in the normal course of their operations, the transaction costs for which would be borne by the respective fund.
Required Vote and Board's Recommendation
The Company's Board has approved the Plan and the Reorganization and has determined that (1) participation in the Reorganization is in the best interests of the Fund and its shareholders and (2) the interests of shareholders of the Fund will not be diluted as a result of the Reorganization. The affirmative vote of a majority of the Fund's shares outstanding and entitled to vote is required to approve the Plan and the Reorganization.
THE COMPANY'S BOARD, ALL OF WHOSE MEMBERS ARE INDEPENDENT
BOARD MEMBERS, UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS
VOTE "FOR" APPROVAL OF THE PLAN AND THE REORGANIZATION.
ADDITIONAL INFORMATION ABOUT THE ACQUIRING FUND AND THE FUND
Information about the Acquiring Fund is incorporated by reference into this Prospectus/Proxy Statement from the Acquiring Fund's Prospectus, forming a part of the Acquiring Company's Registration Statement on Form N-1A (File No. 2-88816). Information about the Fund is incorporated by reference into this Prospectus/Proxy Statement from the Fund's Prospectus, forming a part of the Company's Registration Statement on Form N-1A (File No. 33-51061).
The Fund and the Acquiring Fund are subject to the requirements of the 1940 Act and file reports, proxy statements and other information with the Commission. Reports, proxy statements and other information filed by the Fund and the Acquiring Fund may be inspected and copied at the Public Reference Facilities of the Commission at 100 F Street, N.E., Washington, D.C. 20549. Text-only versions of fund documents can be viewed on-line or downloaded from www.sec.gov or www.dreyfus.com. Copies of such material also can be obtained from the Public Reference Branch, Office of Consumer Affairs and Information Services, Securities and Exchange Commission, Washington, D.C. 20549, at prescribed rates.
VOTING INFORMATION
In addition to the use of the mails, proxies may be solicited personally or by telephone, and persons holding Fund shares in their names or in nominee name may be paid for their expenses in sending soliciting materials to their principals. An outside firm may be retained to assist in the solicitation of proxies, primarily by contacting shareholders by telephone.
Authorizations to execute proxies may be obtained by telephonic or electronically transmitted instructions in accordance with procedures designed to authenticate the shareholder's identity. In all cases where a telephonic proxy is solicited (as opposed to where the shareholder calls the toll-free number directly to vote), the shareholder will be asked to provide or confirm certain identifiable information and to confirm that the shareholder has received the Prospectus/Proxy Statement and proxy card in the mail. Within 72 hours of receiving a shareholder's telephonic or electronically transmitted voting instructions, a confirmation will be sent to the shareholder to ensure that the vote has been taken in accordance with the shareholder's instructions and to provide a telephone number to call immediately if the shareholder's instructions are not correctly reflected in the confirmation. Any shareholder giving a proxy may revoke it at any time before it is exercised by submitting a new proxy to the Fund or by attending the Meeting and voting in person.
If a proxy is executed properly and returned accompanied by instructions to withhold authority to vote, represents a broker "non-vote" (that is, a proxy from a broker or nominee indicating that such person has not received instructions from the beneficial owner or other person entitled to vote Fund shares on a particular matter with respect to which the broker or nominee does not have discretionary power) or is marked with an abstention (collectively, "abstentions"), the Fund shares represented thereby will be considered to be present at the Meeting for purposes of determining the existence of a quorum for the transaction of business. Abstentions will have the effect of a "no" vote for the purpose of obtaining requisite approval for the proposal.
With respect to Dreyfus-sponsored individual retirement accounts ("IRAs"), the Individual Retirement Custodial Account Agreement governing the IRAs requires The Bank of New York Mellon ("BNYM"), as the custodian of the IRAs, to vote Fund shares held in such IRAs in accordance with the IRA shareholder's instructions. However, if no voting instructions are received, BNYM may vote Fund shares held in the IRA in the same proportions as the Fund shares for which voting instructions are received from other Dreyfus IRA shareholders. Therefore, if an IRA shareholder does not provide voting instructions prior to the Meeting, BNYM will vote the IRA shares "FOR", "AGAINST" or "ABSTAIN" in the same proportions as it votes the shares for which properly conveyed instructions are timely received from other Dreyfus IRA shareholders.
In the event that a quorum is not present at the Meeting, or if a quorum is present but sufficient votes to approve the proposal are not received, the persons named as proxies may propose one or more adjournments of the Meeting to permit further solicitation of proxies for the Fund. In determining whether to adjourn the Meeting, the following factors may be considered: the nature of the proposal, the percentage of votes actually cast, the percentage of negative votes actually cast, the nature of any further solicitation and the information to be provided to Fund shareholders with respect to the reasons for the solicitation. Any adjournment will require the affirmative vote of a majority of those shares affected by the adjournment that are represented at the Meeting in person or by proxy. If a quorum is present, the persons named as proxies will vote those proxies which they are entitled to vote "FOR" the proposal in favor of such adjournment, and will vote those proxies required to be voted "AGAINST" the proposal against any adjournment. A quorum is constituted for the Fund by the presence in person or by proxy of the holders of one-third of the Fund's outstanding shares entitled to vote at the Meeting.
The votes of the Acquiring Fund's shareholders are not being solicited since their approval or consent is not necessary for the Reorganization.
As of July 30, 2010, the following shareholders were known by the Fund to own of record or beneficially 5% or more of the indicated class of the Fund's outstanding voting shares:
Percentage of Outstanding Shares | ||
Name and Address | Before Reorganization | After Reorganization |
Class A Shares | % | % |
Class B Shares | % | % |
Class C Shares | % | % |
Class I Shares | % | % |
As of July 30, 2010, the following shareholders were known by the Acquiring Fund to own of record or beneficially 5% or more of the indicated class of the Acquiring Fund's outstanding voting shares:
Percentage of Outstanding Shares | ||
Name and Address | Before Reorganization | After Reorganization |
Class A Shares | % | % |
Class B Shares | % | % |
Class C Shares | % | % |
Class I Shares | % | % |
A shareholder who beneficially owns, directly or indirectly, more than 25% of a fund's voting securities may be deemed a "control person" (as defined in the 1940 Act) of the fund.
As of July 30, 2010, Board members and officers of the Company and the Acquiring Company, as a group, owned less than 1% of the Fund's or the Acquiring Fund's outstanding shares, respectively.
FINANCIAL STATEMENTS AND EXPERTS
The audited financial statements of the Fund for its fiscal year ended August 31, 2009 and the audited financial statements of the Acquiring Fund for its fiscal year ended December 31, 2009 have been incorporated herein by reference in reliance upon the reports of Ernst & Young LLP, independent registered public accounting firm for the Fund and the Acquiring Fund, given on their authority as experts in accounting and auditing.
OTHER MATTERS
The Company's Board members are not aware of any other matters that may come before the Meeting. However, should any such matters properly come before the Meeting, it is the intention of the persons named in the accompanying form of proxy to vote the proxy in accordance with their judgment on such matters.
NOTICE TO BANKS, BROKER/DEALERS AND VOTING TRUSTEES
AND THEIR NOMINEES
Please advise the Fund, in care of Dreyfus Transfer, Inc., P.O. Box 55263, Boston, Massachusetts 02205-5263, whether other persons are the beneficial owners of Fund shares for which proxies are being solicited from you, and, if so, the number of copies of the Prospectus/Proxy Statement and other soliciting material you wish to receive in order to supply copies to the beneficial owners of Fund shares.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY. THEREFORE, SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE MEETING IN PERSON ARE URGED TO COMPLETE, DATE, SIGN AND RETURN THE PROXY CARD IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
AGREEMENT AND PLAN OF REORGANIZATION dated as of July 19, 2010 (the "Agreement"), between ADVANTAGE FUNDS, INC. (the "Company"), a Maryland corporation, on behalf of DREYFUS STRUCTURED MIDCAP FUND (the "Fund"), and STRATEGIC FUNDS, INC. (the "Acquiring Company"), a Maryland corporation, on behalf of DREYFUS ACTIVE MIDCAP FUND (the "Acquiring Fund").
This Agreement is intended to be and is adopted as a "plan of reorganization" within the meaning of the regulations under Section 368(a) of the United States Internal Revenue Code of 1986, as amended (the "Code"). The reorganization will consist of the transfer of all of the assets of the Fund to the Acquiring Fund in exchange solely for the Acquiring Fund's Class A, Class B, Class C and Class I shares ("Acquiring Fund Shares") of common stock, par value $.001 per share, and the assumption by the Acquiring Fund of the liabilities of the Fund as described herein, and the distribution, after the Closing Date hereinafter referred to, of the Acquiring Fund Shares to the shareholders of the Fund in liquidation of the Fund as provided herein, all upon the terms and conditions hereinafter set forth in this Agreement (the "Reorganization").
WHEREAS, the Fund is a series of the Company, a registered, open-end management investment company, and the Acquiring Fund is a series of the Acquiring Company, a registered, open-end management investment company, and the Fund owns securities which are assets of the character in which the Acquiring Fund is permitted to invest;
WHEREAS, both the Fund and the Acquiring Fund are authorized to issue their shares of common stock;
WHEREAS, the Company's Board has determined that the Reorganization is in the best interests of the Fund and the Fund's shareholders and that the interests of the Fund's existing shareholders will not be diluted as a result of the Reorganization; and
WHEREAS, the Acquiring Company's Board has determined that the Reorganization is in the best interests of the Acquiring Fund and the Acquiring Fund's shareholders and that the interests of the Acquiring Fund's existing shareholders will not be diluted as a result of the Reorganization:
NOW THEREFORE, in consideration of the premises and of the covenants and agreements hereinafter set forth, the parties agree as follows:
1. | THE REORGANIZATION. |
1.1 Subject to the terms and conditions contained herein and on the basis of the representations and warranties contained herein, the Fund agrees to assign, transfer and convey to the Acquiring Fund all of the assets of the Fund, as set forth in paragraph 1.2, free and clear of all liens, encumbrances and claims whatsoever. The Acquiring Fund agrees in exchange therefor (a) to deliver to the Fund the number of Acquiring Fund Shares, including fractional Acquiring Fund Shares, determined as set forth in paragraph 2.3; and (b) to assume the stated liabilities of the Fund, as set forth in paragraph 1.3. Such transactions shall take place at the closing (the "Closing") as of the close of business on the closing date (the "Closing Date"), provided for in paragraph 3.1. In lieu of delivering certificates for the Acquiring Fund Shares, the Acquiring Fund shall credit the Acquiring Fund Shares to the Fund's account on the books of the Acquiring Fund and shall deliver a confirmation thereof to the Fund.
1.2 The assets of the Fund to be acquired by the Acquiring Fund shall consist of all assets, including, without limitation, all portfolio securities, cash, cash equivalents, commodities, interests in futures and other financial instruments, claims (whether absolute or contingent, known or unknown), receivables (including dividends or interest and other receivables) and other property belonging to the Fund, and any deferred or prepaid expenses, reflected on an unaudited statement of assets and liabilities of the Fund approved by The Dreyfus Corporation ("Dreyfus"), as of the Valuation Date (as defined in paragraph 2.1), in accordance with U.S. generally accepted accounting principles ("GAAP") consistently applied from the Fund's prior audited period (the "Assets").
1.3 The Fund will endeavor to identify and, to the extent practicable, discharge all of its known liabilities and obligations before the Closing Date. The Acquiring Fund shall assume the liabilities, expenses, costs, charges and reserves reflected on an unaudited statement of assets and liabilities of the Fund approved by Dreyfus, as of the Valuation Date, in accordance with GAAP consistently applied from the Fund's prior audited period. The Acquiring Fund shall assume only those liabilities of the Fund reflected in that unaudited statement of assets and liabilities and shall not assume any other liabilities, whether absolute or contingent.
1.4 Delivery of the Fund's Assets shall be made on the Closing Date and shall be delivered to The Bank of New York Mellon, One Wall Street, New York, New York 10286, the Acquiring Fund's custodian (the "Custodian"), for the account of the Acquiring Fund, with all securities not in bearer or book-entry form duly endorsed, or accompanied by duly executed separate assignments or stock powers, in proper form for transfer, with signatures guaranteed, and with all necessary stock transfer stamps, sufficient to transfer good and marketable title thereto (including all accrued interest and dividends and rights pertaining thereto) to the Custodian for the account of the Acquiring Fund free and clear of all liens, encumbrances, rights, restrictions and claims. All cash delivered shall be in the form of immediately available funds payable to the order of the Custodian for the account of the Acquiring Fund.
1.5 The Fund will pay or cause to be paid to the Acquiring Fund any dividends and interest received on or after the Closing Date with respect to Assets transferred to the Acquiring Fund hereunder. The Fund will transfer to the Acquiring Fund any distributions, rights or other assets received by the Fund after the Closing Date as distributions on or with respect to the securities transferred. Such assets shall be deemed included in the Assets transferred to the Acquiring Fund on the Closing Date and shall not be separately valued.
1.6 As soon after the Closing Date as is conveniently practicable, the Fund will distribute pro rata to holders of record of the Fund's Class A, Class B, Class C and Class I shares, determined as of the close of business on the Closing Date ("Fund Shareholders"), the corresponding class of Acquiring Fund Shares received by the Fund pursuant to paragraph 1.1, and will completely liquidate and, promptly thereafter, terminate in accordance with applicable laws of the State of Maryland and federal securities laws. Such distribution and liquidation will be accomplished by the transfer of the Acquiring Fund Shares then credited to the account of the Fund on the books of the Acquiring Fund to open accounts on the share records of the Acquiring Fund in the names of the Fund Shareholders and representing the respective pro rata number of the applicable Acquiring Fund Shares due such shareholders. All issued and outstanding shares of the Fund simultaneously will be canceled on the books of the Fund and will be null and void. Acquiring Fund Shares distributed to Fund Shareholders will be reflected on the books of the Acquiring Fund as uncertificated, book-entry shares; the Acquiring Fund will not issue share certificates in the Reorganization.
1.7 Ownership of Acquiring Fund Shares will be shown on the books of the Acquiring Fund's transfer agent. Acquiring Fund Shares will be issued in the manner described in the Acquiring Fund's then-current prospectus and statement of additional information.
1.8 Any transfer taxes payable upon issuance of the Acquiring Fund Shares in a name other than the registered holder of the Acquiring Fund Shares on the books of the Fund as of that time shall, as a condition of such issuance and transfer, be paid by the person to whom such Acquiring Fund Shares are to be issued and transferred.
1.9 Any reporting responsibility of the Fund, including the responsibility for filing regulatory reports, tax returns, or other documents with the Securities and Exchange Commission (the "Commission"), any state securities commission, and any federal, state or local tax authorities or any other relevant regulatory authority, is and shall remain the responsibility of the Fund up to and including the Closing Date and such later date on which the Fund's existence is terminated.
1.10 As soon as practicable after the Closing Date, the Company shall provide the Acquiring Fund with copies of all books and records that pertain to the Fund that the Acquiring Fund is required to maintain under the Investment Company Act of 1940, as amended (the "1940 Act"), and the rules of the Commission thereunder.
2. | VALUATION. |
2.1 The value of the Fund's Assets to be acquired, and the amount of the Fund's liabilities to be assumed, by the Acquiring Fund hereunder shall be computed as of the close of trading on the floor of the New York Stock Exchange (usually 4:00 p.m., Eastern time) on the Closing Date (such time and date being hereinafter called the "Valuation Date"), using the valuation procedures set forth in the Acquiring Company's Articles of Incorporation, as amended (the "Acquiring Company's Charter"), and the then-current prospectus or statement of additional information of the Acquiring Fund, which are and shall be consistent with the policies currently in effect for the Fund, or such other valuation procedures as shall be mutually agreed upon by the parties hereto.
2.2 The net asset value of an Acquiring Fund Share shall be the net asset value per share computed as of the Valuation Date, using the valuation procedures set forth in the Acquiring Company's Charter and the then-current prospectus or statement of additional information of the Acquiring Fund, which are and shall be consistent with the policies currently in effect for the Fund.
2.3 The number of Acquiring Fund Shares to be issued (including fractional shares, if any) in exchange for the Fund's net assets shall be determined by dividing the value of the net assets of the applicable class of the Fund determined using the same valuation procedures referred to in paragraph 2.1 by the net asset value of one Acquiring Fund Share of the corresponding class, as the case may be, determined in accordance with paragraph 2.2.
2.4 All computations of value shall be made in accordance with the regular practices of Dreyfus as fund accountant for the Fund and the Acquiring Fund.
3. | CLOSING AND CLOSING DATE. |
3.1 The Closing Date shall be January 20, 2011, or such other date as the parties, through their duly authorized officers, may mutually agree. All acts taking place at the Closing shall be deemed to take place simultaneously on the Closing Date unless otherwise provided. The Closing shall be held at 5:00 p.m., Eastern time, at the offices of Dreyfus, 200 Park Avenue, 8th Floor, New York, New York, or such other time and/or place as the parties may mutually agree.
3.2 The Custodian shall deliver at the Closing a certificate of an authorized officer stating that the Fund's Assets have been delivered in proper form to the Acquiring Fund on the Closing Date. The Fund's portfolio securities and instruments deposited with a securities depository (as defined in Rule 17f-4 under the 1940 Act) or with a permitted counterparty or futures commission merchant (as defined in Rule 17f-6 under the 1940 Act) shall be delivered to the Custodian as of the Closing Date by book entry, in accordance with the customary practices of the Custodian. The cash to be transferred by the Fund shall be delivered to the Custodian for the account of the Acquiring Fund by wire transfer of federal funds on the Closing Date.
3.3 If on the Valuation Date (a) the New York Stock Exchange or another primary trading market for portfolio securities of the Acquiring Fund or the Fund shall be closed to trading or trading thereon shall be restricted, or (b) trading or the reporting of trading on said Exchange or elsewhere shall be disrupted so that accurate appraisal of the value of the net assets of the Acquiring Fund or the Fund is impracticable, the Closing Date shall be postponed until the first business day after the day when trading shall have been fully resumed and reporting shall have been restored or such other date as the parties hereto may agree.
3.4 The Fund's transfer agent shall deliver at the Closing a certificate of an authorized officer stating that its records contain the names and addresses of the Fund Shareholders and the number and percentage ownership of outstanding shares owned by each such shareholder immediately prior to the Closing. The Acquiring Fund's transfer agent shall issue and deliver to the Company's Secretary a confirmation evidencing the Acquiring Fund Shares to be credited on the Closing Date, or provide evidence satisfactory to the Company that such Acquiring Fund Shares have been credited to the Fund's account on the books of the Acquiring Fund.
3.5 ��At the Closing, each party shall deliver to the other such bills of sale, checks, assignments, receipts or other documents as such other party or its counsel may reasonably request.
3.6 If the Fund is unable to make delivery to the Custodian pursuant to paragraph 3.2 of any of the Assets for the reason that any of such Assets have not yet been delivered to the Fund by the Fund's broker, dealer or other counterparty, then, in lieu of such delivery, the Fund shall deliver with respect to said Assets executed copies of an agreement of assignment and due bills executed on behalf of said broker, dealer or other counterparty, together with such other documents as may be required by the Acquiring Fund or the Custodian, including broker confirmation slips.
4. | REPRESENTATIONS AND WARRANTIES. |
4.1 The Company, on behalf of the Fund, represents and warrants to the Acquiring Company, on behalf of the Acquiring Fund, as follows:
(a) The Fund is a duly established and designated series of the Company, a corporation duly organized and validly existing under the laws of the State of Maryland, and has the power to carry out its obligations under this Agreement.
(b) The Company is registered under the 1940 Act as an open-end management investment company, and the Fund's shares are registered under the Securities Act of 1933, as amended (the "1933 Act"), and such registrations have not been revoked or rescinded and are in full force and effect. The Fund is in compliance in all material respects with the 1940 Act and the rules and regulations thereunder.
(c) The current prospectus and statement of additional information of the Fund conform in all material respects to the applicable requirements of the 1933 Act and the 1940 Act and the rules and regulations of the Commission thereunder and do not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.
(d) The Fund is not, and the execution, delivery and performance of this Agreement will not result, in material violation of the Company's Articles of Incorporation, as amended (the "Company's Charter"), or its By-Laws or of any agreement, indenture, instrument, contract, lease or other undertaking to which the Company is a party on behalf of the Fund or by which the Fund is bound, nor will the execution, delivery and performance of this Agreement by the Fund result in the acceleration of any obligation, or the imposition of any penalty, under any agreement, indenture, instrument, contract, lease or other undertaking to which the Company is a party on behalf of the Fund or by which the Fund is bound.
(e) The Fund has no material contracts or other commitments that will be terminated with liability to the Fund on or prior to the Closing Date.
(f) No consent, approval, authorization, or order of any court or governmental authority is required for the consummation by the Fund of the transactions contemplated herein, except as may be required under the 1933 Act, the Securities Exchange Act of 1934, as amended (the "1934 Act"), and the 1940 Act and by state securities laws.
(g) No litigation or administrative proceeding or investigation of or before any court or governmental body is currently pending or to the Company's knowledge threatened against the Fund or any of the Fund's properties or assets which, if adversely determined, would materially and adversely affect the Fund's financial condition or the conduct of the Fund's business. The Fund knows of no facts which might form the basis for the institution of such proceedings, and is not a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially and adversely affects the Fund's business or the Fund's ability to consummate the transactions contemplated herein.
(h) The Statements of Assets and Liabilities, Statements of Operations, Statements of Changes in Net Assets and Statement of Investments (indicating their market values) of the Fund for each of the Fund's five fiscal years ended August 31, 2009 have been audited by Ernst & Young LLP, an independent registered public accounting firm, and are in accordance with GAAP, consistently applied, and such statements (copies of which have been furnished to the Acquiring Fund) fairly reflect the financial condition of the Fund as of such dates, and there are no known contingent liabilities of the Fund as of such dates not disclosed therein.
(i) Since August 31, 2009, there has not been any material adverse change in the Fund's financial condition, assets, liabilities or business other than changes occurring in the ordinary course of business, or any incurrence by the Fund of indebtedness maturing more than one year from the date such indebtedness was incurred, except as disclosed on the statement of assets and liabilities referred to in paragraphs 1.3 and 4.1(h) hereof.
(j) At the Closing Date, all federal and other tax returns and reports of the Fund required by law then to be filed shall have been filed, and all federal and other taxes shown as due on said returns and reports shall have been paid so far as due, or provision shall have been made for the payment thereof, and to the knowledge of the Company no such return is currently under audit and no assessment or deficiency has been asserted with respect to such returns.
(k) For each taxable year of its operation (including the taxable year ending on the Closing Date), the Fund has met the requirements of Subchapter M of the Code for qualification and treatment as a regulated investment company.
(l) All issued and outstanding shares of the Fund are, and at the Closing Date will be, duly and validly issued and outstanding, fully paid and non-assessable by the Fund. All of the issued and outstanding shares of the Fund will, at the time of the Closing, be held by the persons and in the amounts set forth in the records of its transfer agent as provided in paragraph 3.4. The Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any of the Fund's shares, nor is there outstanding any security convertible into any of the Fund's shares.
(m) On the Closing Date, the Fund will have good and marketable title to the Assets and full right, power and authority to sell, assign, transfer and deliver the Assets to be transferred by it hereunder free of any liens or other encumbrances, and upon delivery and payment for the Assets, the Acquiring Fund will acquire good and marketable title thereto, subject to no restrictions on the full transfer thereof, including such restrictions as might arise under the 1933 Act, other than as disclosed to and accepted by the Acquiring Fund.
(n) The execution, delivery and performance of this Agreement will have been duly authorized prior to the Closing Date by all necessary action on the part of the Company's Board and, subject to the approval of the Fund's shareholders, this Agreement will constitute the valid and legally binding obligation of the Company, on behalf of the Fund, enforceable in accordance with its terms, subject to the effect of bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other similar laws relating to or affecting creditors' rights generally and court decisions with respect thereto, and to general principles of equity and the discretion of the court (regardless of whether the enforceability is considered in a proceeding in equity or at law).
(o) The information to be furnished by the Company, on behalf of the Fund, for use in registration statements, proxy materials and other documents filed or to be filed with any federal, state or local regulatory authority (including the Financial Industry Regulatory Authority), which may be necessary in connection with the transactions contemplated hereby, shall be accurate and complete in all material respects and shall comply in all material respects with federal securities and other laws and regulations applicable thereto.
(p) The Registration Statement on Form N-14 and the Prospectus/Proxy Statement contained therein as amended or supplemented (the "Registration Statement"), as of the effective date of the Registration Statement and at all times subsequent thereto up to and including the Closing Date, conform and will conform, as it relates to the Company and the Fund, in all material respects to the requirements of the federal and state securities laws and the rules and regulations thereunder and do not and will not include, as it relates to the Company and the Fund, any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which such statements were made, not misleading.
4.2 The Acquiring Company, on behalf of the Acquiring Fund, represents and warrants to the Company, on behalf of the Fund, as follows:
(a) The Acquiring Fund is a duly established and designated series of the Acquiring Company, a corporation duly organized and validly existing under the laws of the State of Maryland, and has the power to carry out its obligations under this Agreement.
(b) The Acquiring Company is registered under the 1940 Act as an open-end management investment company, and the Acquiring Fund's shares are registered under the 1933 Act, and such registrations have not been revoked or rescinded and are in full force and effect. The Acquiring Fund is in compliance in all material respects with the 1940 Act and the rules and regulations thereunder.
(c) The current prospectus and statement of additional information of the Acquiring Fund conform in all material respects to the applicable requirements of the 1933 Act and the 1940 Act and the rules and regulations of the Commission thereunder and do not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.
(d) The Acquiring Fund is not, and the execution, delivery and performance of this Agreement will not result, in material violation of the Acquiring Company's Charter or its By-Laws or of any agreement, indenture, instrument, contract, lease or other undertaking to which the Acquiring Company is a party on behalf of the Acquiring Fund or by which the Acquiring Fund is bound, nor will the execution, delivery and performance of this Agreement by the Acquiring Fund result in the acceleration of any obligation, or the imposition of any penalty, under any agreement, indenture, instrument, contract, lease or other undertaking to which the Acquiring Company is a party on behalf of the Acquiring Fund or by which the Acquiring Fund is bound.
(e) No consent, approval, authorization, or order of any court or governmental authority is required for the consummation by the Acquiring Fund of the transactions contemplated herein, except as may be required under the 1933 Act, the 1934 Act and the 1940 Act and by state securities laws.
(f) No litigation or administrative proceeding or investigation of or before any court or governmental body is currently pending or to the Acquiring Company's knowledge threatened against the Acquiring Fund or any of the Acquiring Fund's properties or assets which, if adversely determined, would materially and adversely affect the Acquiring Fund's financial condition or the conduct of the Acquiring Fund's business. The Acquiring Fund knows of no facts which might form the basis for the institution of such proceedings, and is not a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially and adversely affects the Acquiring Fund's business or the Acquiring Fund's ability to consummate the transactions contemplated herein.
(g) The Statements of Assets and Liabilities, Statements of Operations, Statements of Changes in Net Assets and Statement of Investments (indicating their market values) of the Acquiring Fund for each of the Acquiring Fund's five fiscal years ended December 31, 2009 have been audited by Ernst & Young LLP, an independent registered public accounting firm, and are in accordance with GAAP, consistently applied, and such statements (copies of which have been furnished to the Fund) fairly reflect the financial condition of the Acquiring Fund as of such dates.
(h) Since December 31, 2009, there has not been any material adverse change in the Acquiring Fund's financial condition, assets, liabilities or business other than changes occurring in the ordinary course of business, or any incurrence by the Acquiring Fund of indebtedness maturing more than one year from the date such indebtedness was incurred, except as disclosed on the statement of assets and liabilities referred to in paragraph 4.2(g) hereof.
(i) At the Closing Date, all federal and other tax returns and reports of the Acquiring Fund required by law then to be filed shall have been filed, and all federal and other taxes shown as due on said returns and reports shall have been paid so far as due, or provision shall have been made for the payment thereof, and to the knowledge of the Acquiring Company no such return is currently under audit and no assessment or deficiency has been asserted with respect to such returns.
(j) For each taxable year of its operation, the Acquiring Fund has met the requirements of Subchapter M of the Code for qualification and treatment as a regulated investment company.
(k) All issued and outstanding shares of the Acquiring Fund are, and at the Closing Date (including the shares of the Acquiring Fund to be issued pursuant to paragraph 1.1 of this Agreement) will be, duly and validly issued and outstanding, fully paid and non-assessable by the Acquiring Fund. The Acquiring Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any of the Acquiring Fund Shares, nor is there outstanding any security convertible into any Acquiring Fund Shares.
(l) The execution, delivery and performance of this Agreement will have been duly authorized prior to the Closing Date by all necessary action on the part of the Acquiring Company's Board and, subject to the approval of the Fund's shareholders, this Agreement will constitute the valid and legally binding obligation of the Acquiring Company, on behalf of the Acquiring Fund, enforceable in accordance with its terms, subject to the effect of bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other similar laws relating to or affecting creditors' rights generally and court decisions with respect thereto, and to general principles of equity and the discretion of the court (regardless of whether the enforceability is considered in a proceeding in equity or at law).
(m) The Registration Statement as of its effective date and at all times subsequent thereto up to and including the Closing Date, conforms and will conform, as it relates to the Acquiring Fund, in all material respects to the requirements of the federal and state securities laws and the rules and regulations thereunder and does not and will not include, as it relates to the Acquiring Fund, any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which such statements were made, not misleading. No representations and warranties in this paragraph 4.2 shall apply to statements or omissions made in reliance upon and in conformity with written information concerning the Fund furnished to the Acquiring Fund by the Company.
(n) No consideration other than the Acquiring Fund Shares (and the Acquiring Fund's assumption of the Fund's stated liabilities) will be issued in exchange for the Fund's assets in the Reorganization.
(o) The Acquiring Fund does not directly or indirectly own, nor on the Closing Date will it directly or indirectly own, nor has it directly or indirectly owned at any time during the past five years, any shares of the Fund.
5. COVENANTS OF THE ACQUIRING COMPANY AND THE COMPANY, ON BEHALF OF THE ACQUIRING FUND AND THE FUND, RESPECTIVELY. |
5.1 The Acquiring Fund and the Fund each will operate its business in the ordinary course between the date hereof and the Closing Date, it being understood that such ordinary course of business will include payment of customary dividends and other distributions.
5.2 The Company will call a meeting of the Fund's shareholders to consider and act upon this Agreement and to take all other action necessary to obtain approval of the transactions contemplated herein.
5.3 Subject to the provisions of this Agreement, the Fund and the Acquiring Fund will each take, or cause to be taken, all action, and do or cause to be done, all things reasonably necessary, proper or advisable to consummate and make effective the transactions contemplated by this Agreement.
5.4 As promptly as practicable, but in any case within sixty days after the Closing Date, the Company shall furnish the Acquiring Fund, in such form as is reasonably satisfactory to the Acquiring Fund, a statement of the earnings and profits of the Fund for federal income tax purposes which will be carried over to the Acquiring Fund as a result of Section 381 of the Code and which will be certified by the Company's President or its Vice President and Treasurer.
5.5 The Company, on behalf of the Fund, will provide the Acquiring Fund with information reasonably necessary for the preparation of the Registration Statement.
5.6 The Acquiring Fund agrees to use all reasonable efforts to obtain the approvals and authorizations required by the 1933 Act, the 1940 Act and such of the state Blue Sky or securities laws as it may deem appropriate in order to continue its operations after the Closing Date.
5.7 The Company, on behalf of the Fund, covenants that the Fund is not acquiring the Acquiring Fund Shares to be issued hereunder for the purpose of making any distribution thereof, other than in accordance with the terms of this Agreement.
5.8 As soon as is reasonably practicable after the Closing, the Fund will make a liquidating distribution to the Fund's shareholders consisting of the Acquiring Fund Shares received at the Closing.
6. | CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND. |
The obligations of the Acquiring Fund to consummate the transactions provided for herein shall be subject, at its election, to the performance by the Fund of all the obligations to be performed by it hereunder on or before the Closing Date and, in addition thereto, the following conditions:
6.1 All representations and warranties of the Company, on behalf of the Fund, contained in this Agreement shall be true and correct in all material respects as of the date hereof and, except as they may be affected by the transactions contemplated by this Agreement, as of the Closing Date with the same force and effect as if made on and as of the Closing Date.
6.2 The Company shall have delivered to the Acquiring Fund a statement of the Fund's assets and liabilities, together with a list of the Fund's portfolio securities showing the tax basis of such securities by lot and the holding periods of such securities, as of the Closing Date, certified by the Company's Treasurer.
6.3 The Company shall have delivered to the Acquiring Fund on the Closing Date a certificate executed in the Company's name by the Company's President or Vice President and its Treasurer, in form and substance satisfactory to the Acquiring Fund, to the effect that the representations and warranties of the Company, on behalf of the Fund, made in this Agreement are true and correct at and as of the Closing Date, except as they may be affected by the transactions contemplated by this Agreement, and as to such other matters as the Acquiring Fund shall reasonably request.
7. | CONDITIONS PRECEDENT TO OBLIGATIONS OF THE FUND. |
The obligations of the Fund to consummate the transactions provided for herein shall be subject, at its election, to the performance by the Acquiring Fund of all the obligations to be performed by it hereunder on or before the Closing Date and, in addition thereto, the following conditions:
7.1 All representations and warranties of the Acquiring Company, on behalf of the Acquiring Fund, contained in this Agreement shall be true and correct in all material respects as of the date hereof and, except as they may be affected by the transactions contemplated by this Agreement, as of the Closing Date with the same force and effect as if made on and as of the Closing Date.
7.2 The Acquiring Company shall have delivered to the Fund on the Closing Date a certificate executed in the Acquiring Company's name by the Acquiring Company's President or Vice President and its Treasurer, in form and substance reasonably satisfactory to the Fund, to the effect that the representations and warranties of the Acquiring Company, on behalf of the Acquiring Fund, made in this Agreement are true and correct at and as of the Closing Date, except as they may be affected by the transactions contemplated by this Agreement, and as to such other matters as the Fund shall reasonably request.
8. | FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE FUND AND THE ACQUIRING FUND. |
If any of the conditions set forth below do not exist on or before the Closing Date with respect to the Fund or the Acquiring Fund, the other party to this Agreement shall, at its option, not be required to consummate the transactions contemplated by this Agreement.
8.1 This Agreement and the transactions contemplated herein shall have been approved by the requisite vote of the holders of the outstanding shares of the Fund in accordance with the provisions of the Company's Charter and the 1940 Act.
8.2 On the Closing Date, no action, suit or other proceeding shall be pending before any court or governmental agency in which it is sought to restrain or prohibit, or obtain damages or other relief in connection with, this Agreement or the transactions contemplated herein.
8.3 All consents of other parties and all other consents, orders and permits of federal, state and local regulatory authorities (including those of the Commission and of state Blue Sky and securities authorities) deemed necessary by the Fund or the Acquiring Fund to permit consummation, in all material respects, of the transactions contemplated hereby shall have been obtained, except where failure to obtain any such consent, order or permit would not involve a risk of a material adverse effect on the assets or properties of the Fund or the Acquiring Fund, provided that either party hereto may for itself waive any of such conditions.
8.4 The Registration Statement shall have become effective under the 1933 Act and no stop orders suspending the effectiveness thereof shall have been issued and, to the best knowledge of the parties hereto, no investigation or proceeding for that purpose shall have been instituted or be pending, threatened or contemplated under the 1933 Act.
8.5 The Fund shall have declared and paid a dividend or dividends which, together with all previous dividends, shall have the effect of distributing to Fund shareholders all of the Fund's investment company taxable income (within the meaning of Section 852(b)(2) of the Code) for all taxable years or periods ending on or prior to the Closing Date (computed without regard to any deduction for dividends paid); the excess of its interest income excludable from gross income under Section 103(a) of the Code over its disallowed deductions under Sections 265 and 171(a)(2) of the Code, for all taxable years or periods; and all of its net capital gain (as defined in Section 1222(11) of the Code) realized in all taxable years or periods (after reduction for any capital loss carryforward).
8.6 The Fund and Acquiring Fund shall have received an opinion of Stroock & Stroock & Lavan LLP substantially to the effect that based on the facts and assumptions stated herein and conditioned on consummation of the Reorganization in accordance with this Agreement, for federal income tax purposes:
(a) The transfer of all of the Fund's assets to the Acquiring Fund in exchange solely for the Acquiring Fund Shares and the assumption by the Acquiring Fund of certain identified liabilities of the Fund, followed by the distribution by the Fund of those Acquiring Fund Shares to Fund Shareholders in complete liquidation of the Fund, will qualify as a "reorganization" within the meaning of Section 368(a) of the Code and each of the Fund and the Acquiring Fund will be "a party to a reorganization"; (b) no gain or loss will be recognized by the Acquiring Fund upon the receipt of the assets of the Fund in exchange solely for Acquiring Fund Shares and the assumption by the Acquiring Fund of certain identified liabilities of the Fund pursuant to the Reorganization; (c) no gain or loss will be recognized by the Fund upon the transfer of the Fund's assets to the Acquiring Fund in exchange solely for Acquiring Fund Shares and the assumption by the Acquiring Fund of certain identified liabilities of the Fund or upon the distribution (whether actual or constructive) of those Acquiring Fund Shares to Fund Shareholders in exchange for their shares of the Fund in liquidation of the Fund pursuant to the Reorganization; (d) no gain or loss will be recognized by Fund Shareholders upon the exchange of their Fund shares for the Acquiring Fund Shares pursuant to the Reorganization; (e) the aggregate tax basis for the Acquiring Fund Shares received by each Fund Shareholder pursuant to the Reorganization will be the same as the aggregate tax basis of the Fund shares held by such Shareholder immediately prior to the Reorganization, and the holding period of those Acquiring Fund Shares received by each Fund Shareholder will include the period during which the Fund shares exchanged therefor were held by such Shareholder (provided the Fund shares were held as capital assets on the date of the Reorganization); and (f) the tax basis of each Fund asset acquired by the Acquiring Fund will be the same as the tax basis of such asset to the Fund immediately prior to the Reorganization, and the holding period of each asset of the Fund in the hands of the Acquiring Fund will include the period during which that asset was held by the Fund.
In rendering its opinion, counsel may rely as to factual matters, exclusively and without independent verification, on the representations and warranties made in this Agreement, which counsel may treat as representations and warranties made to it, and in separate letters addressed to counsel and the certificates delivered pursuant to this Agreement.
No opinion will be expressed as to the effect of the Reorganization on (i) the Fund or the Acquiring Fund with respect to any asset as to which any unrealized gain or loss is required to be recognized for federal income tax purposes at the end of a taxable year (or on the termination or transfer thereof) under a mark-to-market system of accounting, and (ii) any Fund Shareholder that is required to recognize unrealized gains and losses for federal income tax purposes under a mark-to-market system of accounting.
9. | TERMINATION OF AGREEMENT; EXPENSES. |
9.1 This Agreement and the transactions contemplated hereby may be terminated and abandoned by resolution of the Board of the Acquiring Company or of the Company, as the case may be, at any time prior to the Closing Date (and notwithstanding any vote of the Fund's shareholders) if circumstances should develop that, in the opinion of the party's Board, make proceeding with the Reorganization inadvisable.
9.2 If this Agreement is terminated and the transactions contemplated hereby are abandoned pursuant to the provisions of this Section 9, this Agreement shall become void and have no effect, without any liability on the part of any party hereto or the Board members or officers of the Company or the Acquiring Company, or shareholders of the Fund or of the Acquiring Fund, as the case may be, in respect of this Agreement.
9.3 Each party acknowledges that all expenses directly incurred in connection with the Reorganization will be borne by Dreyfus.
10. | WAIVER. |
At any time prior to the Closing Date, except as otherwise expressly provided, any of the foregoing conditions may be waived by the Board of the Company or of the Acquiring Company if, in the judgment of either, such waiver will not have a material adverse effect on the benefits intended under this Agreement to the shareholders of the Fund or of the Acquiring Fund, as the case may be.
11. | MISCELLANEOUS. |
11.1 None of the representations and warranties included or provided for herein shall survive consummation of the transactions contemplated hereby.
11.2 This Agreement contains the entire agreement and understanding between the parties hereto with respect to the subject matter hereof, and merges and supersedes all prior discussions, agreements and understandings of every kind and nature between them relating to the subject matter hereof. Neither party shall be bound by any condition, definition, warranty or representation, other than as set forth or provided in this Agreement or as may be, on or subsequent to the date hereof, set forth in a writing signed by the party to be bound thereby.
11.3 This Agreement shall be governed and construed in accordance with the internal laws of the State of New York, without giving effect to principles of conflict of laws; provided, however, that the due authorization, execution and delivery of this Agreement by the Acquiring Company, on behalf of the Acquiring Fund, and the Company, on behalf of the Fund, shall be governed and construed in accordance with the internal laws of the State of Maryland, without giving effect to principles of conflict of laws; provided that, in the case of any conflict between those laws and the federal securities laws, the latter shall govern.
11.4 This Agreement may be amended only by a signed writing between the parties.
11.5 This Agreement may be executed in counterparts, each of which, when executed and delivered, shall be deemed to be an original.
11.6 This Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns, but no assignment or transfer hereof or of any rights or obligations hereunder shall be made by any party without the written consent of the other party. Nothing herein expressed or implied is intended or shall be construed to confer upon or give any person, firm or corporation, other than the parties hereto and their respective successors and assigns, any rights or remedies under or by reason of this Agreement.
11.7 It is expressly agreed that the obligations of the parties hereunder shall not be binding upon any of the Board members or officers of the Company or the Acquiring Company, or shareholders, nominees, agents, or employees of the Fund or the Acquiring Fund personally, but shall bind only the property of the Fund or the Acquiring Fund, as the case may be, as provided in the Company's Charter or the Acquiring Company's Charter. The execution and delivery of this Agreement by such officers shall not be deemed to have been made by any of them individually or to impose any liability on any of them personally, but shall bind only the property of the Fund or the Acquiring Fund, as the case may be.
IN WITNESS WHEREOF, the Company, on behalf of the Fund, and the Acquiring Company, on behalf of the Acquiring Fund, have each caused this Agreement and Plan of Reorganization to be executed and attested on its behalf by its duly authorized representatives as of the date first above written.
ADVANTAGE FUNDS, INC., on behalf of Dreyfus Structured Midcap Fund | ||
By: | ||
Bradley J. Skapyak, President | ||
ATTEST: | |
Jeff Prusnofsky, Assistant Secretary | |
STRATEGIC FUNDS, INC., on behalf of Dreyfus Active MidCap Fund | ||
By: | ||
Bradley J. Skapyak, President | ||
ATTEST: | |
Jeff Prusnofsky, Assistant Secretary | |
EXHIBIT B
DESCRIPTION OF THE ACQUIRING COMPANY'S BOARD MEMBERS
Board members of the Acquiring Company, together with information as to their positions with the Acquiring Company, principal occupations and other board memberships for the past five years, are shown below.1
Name (Age) Position with Acquiring Company (Since) | Principal Occupation During Past 5 Years | Other Public Company Board Memberships During Past 5 Years | |||
Joseph S. DiMartino (66) Chairman of the Board (1995) | Corporate Director and Trustee | CBIZ (formerly, Century Business Services, Inc.), a provider of outsourcing functions for small and medium size companies, Director (1997 – present) The Newark Group, a provider of a national market of paper recovery facilities, paperboard mills and paperboard converting plants, Director (2000 – present) Sunair Services Corporation, a provider of certain outdoor-related services to homes and businesses, Director (2005 – 2009) | |||
David W. Burke (74) Board Member (1994) | Corporate Director and Trustee | N/A | |||
William Hodding Carter III (75) Board Member (1988) | Professor of Leadership & Public Policy, University of North Carolina, Chapel Hill (2006 – present) President and Chief Executive Officer of the John S. and James L. Knight Foundation (1998 – 2006) | N/A | |||
Gordon J. Davis (68) Board Member (2006) | Partner in the law firm of Dewey & LeBoeuf LLP | Consolidated Edison, Inc., a utility company, Director (1997 – present) Phoenix Companies, Inc., a life insurance company, Director (2000 – present) | |||
Joni Evans (68) Board Member (2006) | Chief Executive Officer, www.wowOwow.com, an online community dedicated to women's conversations and publications Principal, Joni Evans Ltd. (publishing) Senior Vice President of the William Morris Agency (1994 – 2006) | N/A | |||
Ehud Houminer (69) Board Member (1994) | Executive-in-Residence at the Columbia Business School, Columbia University | Avnet, Inc., an electronics distributor, Director (1993 – present) | |||
Richard C. Leone (70) Board Member (1984) | President of The Century Foundation (formerly, The Twentieth Century Fund, Inc.), a tax exempt research foundation engaged in the study of economic, foreign policy and domestic issues | N/A | |||
Hans C. Mautner (72) Board Member (1984) | President – International Division and an Advisory Director of Simon Property Group, a real estate investment company Chairman and Chief Executive Officer of Simon Global Limited, a real estate company (1999 – present) | N/A | |||
Robin A. Melvin (46) Board Member (1995) | Director, Boisi Family Foundation, a private family foundation that supports youth-serving organizations that promote the self sufficiency of youth from disadvantaged circumstances (1995 – present) Senior Vice President, MENTOR, a national non-profit youth mentoring organization (1992 – 2005) | N/A | |||
Burton N. Wallack (59) Board Member (2006) | President and Co-owner of Wallack Management Company, a real estate management company | N/A | |||
John E. Zuccotti (73) Board Member (1984) | Chairman of Brookfield Financial Properties, Inc. Senior Counsel of Weil, Gotshal & Manges, LLP Emeritus Chairman of the Real Estate Board of New York | Wellpoint, Inc., a health benefits company, Director (2005 – present) |
________________________
1 None of the Board members are "interested persons" of the Acquiring Company, as defined in the 1940 Act.
Each Board member of the Acquiring Company, as is the case with each Board member of the Company, has been a Board member of other Dreyfus mutual funds for over 10 years. Additional information about each Board member of the Acquiring Company follows (supplementing the information provided in the table above) that describes some of the specific experiences, qualifications, attributes or skills that each such Board member possesses which the Board of the Acquiring Company believes has prepared them to be effective Board members. The Board of the Acquiring Company believes that the significance of each Board member's experience, qualifications, attributes or skills is an individual matter (meaning that experience that is important for one Board member may not have the same value for another) and that these factors are best evaluated at the board level, with no single Board member, or particular factor, being indicative of board effectiveness. However, the Board of the Acquiring Company, as does the Board of the Company, believes that Board members need to have the ability to critically review, evaluate, question and discuss information provided to them, and to interact effectively with fund management, service providers and counsel, in order to exercise effective business judgment in the performance of their duties; the Board of the Acquiring Company believes that its members satisfy this standard. Experience relevant to having this ability may be achieved through a Board member's educational background; business, professional training or practice (e.g., medicine, accounting or law), public service or academic positions; experience from service as a board member (including the Board of the Acquiring Company) or as an executive of investment funds, public companies or significant private or not-for-profit entities or other organizations; and/or other life experiences. The charter for the nominating committee of the Board of the Acquiring Company contains certain other factors considered by the committee in identifying and evaluating potential Board member nominees. To assist them in evaluating matters under federal and state law, the Board members of the Acquiring Company are counseled by their own independent legal counsel, who participates in Board meetings and interacts with Dreyfus, and also may benefit from information provided by Dreyfus' counsel. The Board of the Acquiring Company and its committees have the ability to engage other experts as appropriate. The Acquiring Company's Board evaluates its performance on an annual basis.
● | Joseph S. DiMartino – Mr. DiMartino has been the Chairman of the Board of the funds in the Dreyfus Family of Funds for over 15 years. From 1971 through 1994, Mr. DiMartino served in various roles as an employee of Dreyfus (prior to its acquisition by a predecessor of BNY Mellon in August 1994 and related management changes), including portfolio manager, President, Chief Operating Officer and a Director. He ceased being an employee or Director of Dreyfus by the end of 1994. From July 1995 to November 1997, Mr. DiMartino served as Chairman of the Board of The Noel Group, a public buyout firm; in that capacity, he helped manage, acquire, take public and liquidate a number of operating companies. Mr. DiMartino has been a Director of The Muscular Dystrophy Association since 1986. |
● | David W. Burke – Mr. Burke was previously a member of the Labor-Management Committee for the U.S. Department of Commerce, Executive Secretary to the President's Advisory Committee on Labor-Management Policy, Secretary to the Governor of the State of New York and Chief of Staff for Senator Edward M. Kennedy. In addition, Mr. Burke previously served as the President of CBS News and as the Chairman of the federal government's Broadcasting Board of Governors, which oversees the Voice of America, Radio Free Europe, Radio Free Asia and other U.S. government-sponsored international broadcasts. Mr. Burke also was a Vice President and Chief Operating Officer of Dreyfus (prior to its acquisition by a predecessor of BNY Mellon in August 1994 and related management changes). |
● | William Hodding Carter III – Mr. Carter served as spokesman of the Department of State and as Assistant Secretary of State for Public Affairs in the Carter administration. Mr. Carter held the Knight Chair in Journalism at the University of Maryland College of Journalism from 1995 to 1998, and is now the University Professor of Leadership and Public Policy at the University of North Carolina at Chapel Hill. Mr. Carter's work as a journalist includes serving as Chief Correspondent on "Frontline," public television's flagship public affairs series. |
● | Gordon J. Davis – Mr. Davis is a partner in the law firm of Dewey & LeBoeuf LLP, where his practice involves complex real estate, land use development and related environmental matters. Prior to joining the firm, Mr. Davis served as a Commissioner and member of the New York City Planning Commission, and as Commissioner of Parks and Recreation for the City of New York. Mr. Davis was a co-founder of the Central Park Conservancy and the founding Chairman of Jazz at the Lincoln Center for the Performing Arts in New York City. He has also served as President of Lincoln Center. Mr. Davis also served on the board of Dreyfus (prior to its acquisition by a predecessor of BNY Mellon in August 1994 and related management changes). |
● | Joni Evans – Ms. Evans has more than 35 years experience in the publishing industry, serving as Publisher of Random House, Inc., President and Publisher of Simon & Schuster, Inc. and, most recently, Senior Vice President of the William Morris Agency, Inc.'s literary department until 2006. Ms. Evans is a member of the Young Presidents' Organization and the Women's Forum, and is a founding member of The Committee of 200 and Women's Media Group. |
● | Ehud Houminer – Mr. Houminer currently serves on Columbia Business School's Board of Overseers. Prior to his association with Columbia Business School beginning in 1991, Mr. Houminer held various senior financial, strategic and management positions at Philip Morris Companies Inc., including serving as Senior Corporate Vice President for Corporate Planning, and as President and Chief Executive Officer of Philip Morris USA, Inc. (now part of Altria Group, Inc.). Mr. Houminer is Chairman of the Business School Board and a Trustee of Ben Gurion University. |
● | Richard C. Leone – Mr. Leone currently serves as President of the Century Foundation (formerly named the Twentieth Century Fund), a non-profit public policy research foundation. Prior to that, Mr. Leone served as Chairman of the Port Authority of New York and New Jersey and as State Treasurer of New Jersey. Mr. Leone also has served as President of the New York Mercantile Exchange and was a Managing Director at Dillon Read and Co., an investment banking firm. He is a member of the Council on Foreign Relations and the National Academy of Social Insurance. |
● | Hans C. Mautner – Mr. Mautner is President of the International Division of Simon Property Group, Inc. and Chairman of Simon Global Limited. Mr. Mautner previously served as Vice Chairman of the Board of Directors of Simon Property Group, Inc., Chairman of the Board of Directors and Chief Executive Officer of Corporate Property Investors and as a General Partner of Lazard Frères. In addition, Mr. Mautner is currently Chairman of Simon Ivanhoe BV/SARL and Chairman of Gallerie Commerciali Italia S.p.A. |
● | Robin A. Melvin – Ms. Melvin is currently a Director of the Boisi Family Foundation, a private family foundation that supports organizations serving the needs of youth from disadvantaged circumstances. In that role she also manages the Boisi Family Office, providing the primary interface with all investment managers, legal advisors and other service providers to the family. She has also served in various roles with MENTOR, a national non-profit youth mentoring advocacy organization, including Executive Director of the New York City affiliate, Vice President of the national affiliate network, Vice President of Development, and, immediately prior to her departure, Senior Vice President in charge of strategy. Prior to that, Ms. Melvin served as an investment banker with Goldman Sachs Group, Inc. |
● | Burton N. Wallack – Mr. Wallack is President and co-owner of Wallack Management Company, a real estate management company that provides financial reporting and management services. |
● | John E. Zuccotti – Mr. Zuccotti is senior counsel to the law firm of Weil, Gotshal & Manges LLP, focusing his legal practice on real estate, land use and development. Prior to that, Mr. Zuccotti served as First Deputy Mayor of the City of New York and as Chairman of the New York City Planning Commission. In addition, Mr. Zuccotti has served as a member of the boards of Empire BlueCross BlueShield, Applied Graphics Technologies, Inc. and Olympia & York Companies (U.S.A.), and as Chairman of the board of directors of Brookfield Financial Properties, Inc. since 1996. |
DREYFUS STRUCTURED MIDCAP FUND
The undersigned shareholder of Dreyfus Structured Midcap Fund (the "Fund"), a series of Advantage Funds, Inc. (the "Company"), hereby appoints Jeff Prusnofsky and Joseph M. Chioffi, and each of them, the attorneys and proxies of the undersigned, with full power of substitution, to vote, as indicated herein, all of the shares of common stock of the Fund standing in the name of the undersigned at the close of business on September 1, 2010 at a Special Meeting of Shareholders to be held at the offices of The Dreyfus Corporation, 200 Park Avenue, 8th Floor, New York, New York 10166, at 9:30 a.m., on Wednesday, November 17, 2010, and at any and all adjournments thereof, with all of the powers the undersigned would possess if then and there personally present and especially (but without limiting the general authorization and power hereby given) to vote as indicated on the proposal, as more fully described in the Prospectus/Proxy Statement for the meeting.
THIS PROXY IS SOLICITED BY THE COMPANY'S BOARD OF DIRECTORS AND WILL BE VOTED FOR THE PROPOSAL SHOWN ON THE REVERSE SIDE UNLESS OTHERWISE INDICATED.
THREE EASY WAYS TO VOTE YOUR PROXY
1. | TELEPHONE: Call 1-800-690-6903 and follow the simple instructions. |
2. | INTERNET: Go to www.proxyvote.com, and follow the on-line directions. |
3. | MAIL: Vote, sign and date, and return in the enclosed postage-paid envelope. |
If you are NOT voting by Telephone or Internet, Please Sign, Date and Return the Proxy Card Promptly Using the Enclosed Envelope.
Dated: ________________________ |
Sign, Date and Return the Proxy Card Promptly Using the Enclosed Envelope ______________________________ |
Signature(s) (Sign in the Box) |
Signature(s) should be exactly as name or names appearing on this proxy. If shares are held jointly, each holder should sign. If signing is by attorney, executor, administrator, trustee or guardian, please give full title. By signing this proxy card, receipt of the accompanying Notice of Special Meeting of Shareholders and Prospectus/Proxy Statement is acknowledged. |
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: x
1. | To approve an Agreement and Plan of Reorganization providing for the transfer of all of the assets of the Fund to Dreyfus Active MidCap Fund (the "Acquiring Fund"), in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund having an aggregate net asset value equal to the value of the Fund's net assets and the assumption by the Acquiring Fund of the Fund's stated liabilities (the "Reorganization"). Class A, Class B, Class C and Class I shares of the Acquiring Fund received by the Fund in the Reorganization will be distributed by the Fund to its Class A, Class B, Class C and Class I shareholders, respectively, in liquidation of the Fund, after which the Fund will cease operations and will be terminated as a series of the Company. |
FOR | AGAINST | ABSTAIN | |
¨ | ¨ | ¨ |
2. | In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting, or any adjournment(s) thereof. |
PLEASE SIGN AND DATE ON THE REVERSE SIDE.
STATEMENT OF ADDITIONAL INFORMATION |
August [__], 2010 |
Acquisition of the Assets of |
DREYFUS STRUCTURED MIDCAP FUND (A Series of Advantage Funds, Inc.) |
144 Glenn Curtiss Boulevard |
Uniondale, New York 11556-0144 |
1-800-554-4611 |
By and in Exchange for Class A, B, C, and I Shares of |
DREYFUS ACTIVE MIDCAP FUND (A Series of Strategic Funds, Inc.) |
144 Glenn Curtiss Boulevard |
Uniondale, New York 11556-0144 |
1-800-554-4611 |
This Statement of Additional Information, which is not a prospectus, supplements and should be read in conjunction with the Prospectus/Proxy Statement dated August [__], 2010 relating specifically to the proposed transfer of all of the assets and liabilities of Dreyfus Structured Midcap Fund (the "Fund"), a series of Advantage Funds, Inc. (the "Company"), in exchange for Class A, Class B, Class C and Class I shares of Dreyfus Active MidCap Fund (the "Acquiring Fund"), a series of Strategic Funds, Inc. (the "Acquiring Company"). The transfer is to occur pursuant to an Agreement and Plan of Reorganization. This Statement of Additional Information consists of this cover page and the following documents attached hereto:
1. | The Acquiring Fund's Statement of Additional Information dated May 1, 2010. |
2. | The Acquiring Fund's Annual Report for the fiscal year ended December 31, 2009. |
3. | The Acquiring Fund's Semi-Annual Report for the six-month period ended June 30, 2010. |
4. | The Fund's Statement of Additional Information dated January 1, 2010. |
5. The Fund's Annual Report for the fiscal year ended August 31, 2009.
6. | The Fund's Semi-Annual Report for the six-month period ended February 28, 2010. |
7. | Pro forma financial statements for the combined Fund and Acquiring Fund as of December 31, 2009. |
The Acquiring Fund's Statement of Additional Information, and the financial statements included in the Acquiring Fund's Annual Report and Semi-Annual Report, and the Fund's Annual Report, are incorporated herein by reference. The Prospectus/Proxy Statement dated August [__], 2010 may be obtained by writing to the Fund or the Acquiring Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144.
DOCUMENTS INCORPORATED BY REFERENCE
The Acquiring Fund's Statement of Additional Information dated May 1, 2010 is incorporated herein by reference to the Acquiring Company's Post-Effective Amendment No. 62 to its Registration Statement on Form N-1A, filed on April 30, 2010 (File No. 2-88816). The financial statements of the Acquiring Fund are incorporated herein by reference to its Annual Report for its fiscal year ended December 31, 2009, filed March 1, 2010.
The Fund's Statement of Additional Information dated January 1, 2010 is incorporated herein by reference to the Company's Post-Effective Amendment No. 88 to its Registration Statement on Form N-1A, filed December 23, 2009 (File No. 33-51061). The financial statements of the Fund are incorporated herein by reference to its Annual Report for its fiscal year ended August 31, 2009, filed November 2, 2009.
Dreyfus Active MidCap Fund |
Pro Forma Statement of Investments |
December 31, 2009 (Unaudited) |
Dreyfus Active MidCap Fund | Dreyfus Structured Midcap Fund | Dreyfus S&P STARS Opportunities S&P Fund | Dreyfus Active MidCap Fund Pro Forma Combined (*) | Dreyfus Active MidCap Fund | Dreyfus Structured Midcap Fund | Dreyfus S&P STARS Opportunities Fund | Dreyfus Active MidCap Fund Pro Forma Combined (*) | ||||||||||||||
Common Stocks--99.7% | Shares | Value ($) | |||||||||||||||||||
Commercial & Professional Services--0.9% | |||||||||||||||||||||
FactSet Research Systems | 12,300 | b | 12,300 | 810,201 | 810,201 | ||||||||||||||||
FTI Consulting | 4,400 | a | 4,400 | 207,504 | 207,504 | ||||||||||||||||
Gartner | 39,700 | a | 39,700 | 716,188 | 716,188 | ||||||||||||||||
1,733,893 | 1,733,893 | ||||||||||||||||||||
Consumer Discretionary--16.4% | |||||||||||||||||||||
Advance Auto Parts | 110,100 | a | 36,600 | a | 110,000 | 256,700 | 4,456,848 | 1,481,568 | 4,452,800 | 10,391,216 | |||||||||||
Aeropostale | 151,500 | b | 27,650 | b | 150,000 | b | 329,150 | 5,158,575 | 941,482 | 5,107,500 | 11,207,557 | ||||||||||
American Greetings, Cl. A | 33,900 | 33,900 | 738,681 | 738,681 | |||||||||||||||||
Barnes & Noble | 29,100 | a | 29,100 | 554,937 | 554,937 | ||||||||||||||||
Big Lots | 167,500 | a,b | 167,500 | 4,854,150 | 4,854,150 | ||||||||||||||||
Blyth | 6,500 | 6,500 | 219,180 | 219,180 | |||||||||||||||||
Boyd Gaming | 23,000 | a,b | 23,000 | 192,510 | 192,510 | ||||||||||||||||
Brinker International | 48,200 | 48,200 | 719,144 | 719,144 | |||||||||||||||||
Cheesecake Factory | 62,900 | a,b | 62,900 | 1,358,011 | 1,358,011 | ||||||||||||||||
Chico's FAS | 100,000 | a | 100,000 | 1,405,000 | 1,405,000 | ||||||||||||||||
Coach | 180,000 | 180,000 | 6,575,400 | 6,575,400 | |||||||||||||||||
Corinthian Colleges | 331,100 | a,b | 331,100 | 4,559,247 | 4,559,247 | ||||||||||||||||
DeVry | 7,300 | 7,300 | 414,129 | 414,129 | |||||||||||||||||
DISH Network, Cl. A | 285,300 | 285,300 | 5,925,681 | 5,925,681 | |||||||||||||||||
Dollar Tree | 119,800 | b | 23,100 | b | 21,000 | b | 163,900 | 5,786,340 | 1,115,730 | 1,014,300 | 7,916,370 | ||||||||||
Family Dollar Stores | 178,900 | 14,600 | 162,000 | 355,500 | 4,978,787 | 406,318 | 4,508,460 | 9,893,565 | |||||||||||||
Foot Locker | 78,300 | 78,300 | 872,262 | 872,262 | |||||||||||||||||
Fossil | 19,600 | b | 19,600 | 657,776 | 657,776 | ||||||||||||||||
GameStop, Cl. A | 231,900 | a,b | 100,000 | a,b | 331,900 | 5,087,886 | 2,194,000 | 7,281,886 | |||||||||||||
Garmin | 175,700 | a | 175,700 | 5,393,990 | 5,393,990 | ||||||||||||||||
H & R Block | 273,100 | 273,100 | 6,177,522 | 6,177,522 | |||||||||||||||||
IAC/InterActiveCorp | 15,100 | b | 15,100 | 309,248 | 309,248 | ||||||||||||||||
International Speedway, Cl. A | 9,400 | 9,400 | 267,430 | 267,430 | |||||||||||||||||
ITT Educational Services | 11,700 | b | 7,600 | a,b | 19,300 | 1,122,732 | 729,296 | 1,852,028 | |||||||||||||
Leggett & Platt | 107,400 | a | 107,400 | 2,190,960 | 2,190,960 | ||||||||||||||||
Lennar, Cl. A | 150,000 | 150,000 | 1,915,500 | 1,915,500 | |||||||||||||||||
Liberty Global, Cl. A | 238,600 | a,b | 238,600 | 5,227,726 | 5,227,726 | ||||||||||||||||
Panera Bread, Cl. A | 7,800 | b | 7,800 | 522,366 | 522,366 | ||||||||||||||||
PetSmart | 32,100 | 32,100 | 856,749 | 856,749 | |||||||||||||||||
Priceline.com | 21,800 | a,b | 21,800 | 4,763,300 | 4,763,300 | ||||||||||||||||
Pulte Group | 58,100 | a,b | 58,100 | 581,000 | 581,000 | ||||||||||||||||
Regal Entertainment Group, Cl. A | 23,800 | 23,800 | 343,672 | 343,672 | |||||||||||||||||
Regis | 15,100 | a | 15,100 | 235,107 | 235,107 | ||||||||||||||||
Rent-A-Center | 134,400 | b | 40,800 | b | 175,200 | 2,381,568 | 722,976 | 3,104,544 | |||||||||||||
Ross Stores | 26,700 | a | 16,500 | 43,200 | 1,140,357 | 704,715 | 1,845,072 | ||||||||||||||
Scholastic | 21,600 | a | 21,600 | 644,328 | 644,328 | ||||||||||||||||
Sherwin-Williams | 53,900 | 53,900 | 3,322,935 | 3,322,935 | |||||||||||||||||
Snap-On | 25,700 | 25,700 | 1,086,082 | 1,086,082 | |||||||||||||||||
Timberland, Cl. A | 20,500 | b | 20,500 | 367,565 | 367,565 | ||||||||||||||||
Toll Brothers | 100,000 | b | 100,000 | 1,881,000 | 1,881,000 | ||||||||||||||||
TRW Automotive Holdings | 215,200 | a,b | 215,200 | 5,138,976 | 5,138,976 | ||||||||||||||||
Under Armour, Cl. A | 93,000 | a,b | 93,000 | 2,536,110 | 2,536,110 | ||||||||||||||||
Warnaco Group | 18,600 | b | 18,600 | 784,734 | 784,734 | ||||||||||||||||
Wyndham Worldwide | 11,000 | 11,000 | 221,870 | 221,870 | |||||||||||||||||
78,783,740 | 16,203,410 | 32,319,366 | 127,306,516 | ||||||||||||||||||
Consumer Staples--4.7% | |||||||||||||||||||||
BJ's Wholesale Club | 15,000 | a,b | 15,000 | 490,650 | 490,650 | ||||||||||||||||
Coca-Cola Enterprises | 276,100 | 276,100 | 5,853,320 | 5,853,320 | |||||||||||||||||
Dean Foods | 283,100 | b | 283,100 | 5,107,124 | 5,107,124 | ||||||||||||||||
Del Monte Foods | 440,400 | 440,400 | 4,994,136 | 4,994,136 | |||||||||||||||||
Estee Lauder, Cl. A | 76,900 | 76,900 | 3,718,884 | 3,718,884 | |||||||||||||||||
Hershey | 101,600 | 101,600 | 3,636,264 | 3,636,264 | |||||||||||||||||
Hormel Foods | 20,200 | 20,200 | 776,690 | 776,690 | |||||||||||||||||
Lancaster Colony | 19,000 | 25,300 | 44,300 | 944,300 | 1,257,410 | 2,201,710 | |||||||||||||||
Lorillard | 26,400 | 26,400 | 2,118,072 | 2,118,072 | |||||||||||||||||
Smithfield Foods | 26,800 | a,b | 26,800 | 407,092 | 407,092 | ||||||||||||||||
SUPERVALU | 111,300 | 111,300 | 1,414,623 | 1,414,623 | |||||||||||||||||
Tyson Foods, Cl. A | 299,700 | 20,000 | 319,700 | 3,677,319 | 245,400 | 3,922,719 | |||||||||||||||
Universal | 15,800 | a | 14,000 | a | 29,800 | 720,638 | 638,540 | 1,359,178 | |||||||||||||
31,464,042 | 3,407,230 | 1,129,190 | 35,509,812 | ||||||||||||||||||
Energy--4.7% | |||||||||||||||||||||
Bill Barrett | 27,100 | a,b | 27,100 | 843,081 | 843,081 | ||||||||||||||||
BJ Services | 46,300 | 46,300 | 861,180 | 861,180 | |||||||||||||||||
Encore Acquisition | 11,000 | b | 18,500 | b | 29,500 | 528,220 | 888,370 | 1,416,590 | |||||||||||||
Energen | 11,600 | 11,600 | 542,880 | 542,880 | |||||||||||||||||
FMC Technologies | 20,000 | a,b | 20,000 | 1,156,800 | 1,156,800 | ||||||||||||||||
Frontier Oil | 62,300 | 62,300 | 750,092 | 750,092 | |||||||||||||||||
Helix Energy Solutions Group | 14,300 | b | 14,300 | 168,025 | 168,025 | ||||||||||||||||
Mariner Energy | 150,000 | b | 150,000 | 1,741,500 | 1,741,500 | ||||||||||||||||
Murphy Oil | 53,400 | 53,400 | 2,894,280 | 2,894,280 | |||||||||||||||||
Noble | 150,000 | 150,000 | 6,105,000 | 6,105,000 | |||||||||||||||||
Plains Exploration & Production | 14,600 | b | 14,600 | 403,836 | 403,836 | ||||||||||||||||
Spectra Energy | 331,700 | 331,700 | 6,803,167 | 6,803,167 | |||||||||||||||||
Tesoro | 346,900 | a | 22,600 | a | 369,500 | 4,700,495 | 306,230 | 5,006,725 | |||||||||||||
Unit | 16,000 | b | 16,000 | 680,000 | 680,000 | ||||||||||||||||
WGL Holdings | 8,600 | a | 8,300 | 16,900 | 288,444 | 278,382 | 566,826 | ||||||||||||||
Whiting Petroleum | 80,100 | a,b | 80,100 | 5,723,145 | 5,723,145 | ||||||||||||||||
XTO Energy | 109,000 | 109,000 | 5,071,770 | 5,071,770 | |||||||||||||||||
21,798,931 | 4,860,896 | 14,075,070 | 35,663,127 | ||||||||||||||||||
Financial--15.1% | |||||||||||||||||||||
Aaron's | 20,800 | a | 20,800 | 576,784 | 576,784 | ||||||||||||||||
Alexandria Real Estate Equities | 12,900 | a,d | 12,900 | 829,341 | 829,341 | ||||||||||||||||
Allied World Assurance Holdings | 12,000 | 12,000 | 552,840 | 552,840 | |||||||||||||||||
American Financial Group | 200,800 | 48,750 | 249,550 | 5,009,960 | 1,216,313 | 6,226,273 | |||||||||||||||
AmeriCredit | 67,700 | a,b | 67,700 | 1,289,008 | 1,289,008 | ||||||||||||||||
Ameriprise Financial | 15,500 | 15,500 | 601,710 | 601,710 | |||||||||||||||||
Annaly Capital Management | 365,100 | 30,500 | 395,600 | 6,334,485 | 529,175 | 6,863,660 | |||||||||||||||
Corporate Office Properties Trust | 13,800 | 13,800 | 505,494 | 505,494 | |||||||||||||||||
Discover Financial Services | 425,138 | 425,138 | 6,253,780 | 6,253,780 | |||||||||||||||||
Endurance Specialty Holdings | 16,200 | 16,200 | 603,126 | 603,126 | |||||||||||||||||
Equity One | 18,200 | 18,200 | 294,294 | 294,294 | |||||||||||||||||
Everest Re Group | 14,300 | 50,000 | 64,300 | 1,225,224 | 4,284,000 | 5,509,224 | |||||||||||||||
Federated Investors, Cl. B | 199,600 | a | 12,000 | a | 211,600 | 5,489,000 | 330,000 | 5,819,000 | |||||||||||||
FirstMerit | 49,400 | 49,400 | 994,916 | 994,916 | |||||||||||||||||
Fortress Investment Group | 700,000 | a,b | 700,000 | 3,115,000 | 3,115,000 | ||||||||||||||||
GATX | 13,100 | a | 13,100 | 376,625 | 376,625 | ||||||||||||||||
HCC Insurance Holdings | 39,900 | 23,700 | 63,600 | 1,116,003 | 662,889 | 1,778,892 | |||||||||||||||
Hospitality Properties Trust | 105,100 | d | 55,000 | d | 160,100 | 2,491,921 | 1,304,050 | 3,795,971 | |||||||||||||
Hudson City Bancorp | 160,100 | 70,600 | 420,000 | 650,700 | 2,198,173 | 969,338 | 5,766,600 | 8,934,111 | |||||||||||||
Interactive Brokers Group, Cl. A | 130,300 | a,b | 130,300 | 2,308,916 | 2,308,916 | ||||||||||||||||
IntercontinentalExchange | 11,000 | b | 11,000 | 1,235,300 | 1,235,300 | ||||||||||||||||
International Bancshares | 12,000 | a | 12,000 | 227,160 | 227,160 | ||||||||||||||||
Invesco | 150,000 | 150,000 | 3,523,500 | 3,523,500 | |||||||||||||||||
Investment Technology Group | 228,600 | b | 228,600 | 4,503,420 | 4,503,420 | ||||||||||||||||
Liberty Property Trust | 13,700 | a,d | 13,700 | 438,537 | 438,537 | ||||||||||||||||
Macerich | 18,039 | d | 18,039 | 648,502 | 648,502 | ||||||||||||||||
Mack-Cali Realty | 4,500 | 4,500 | 155,565 | 155,565 | |||||||||||||||||
Mercury General | 3,000 | 3,000 | 117,780 | 117,780 | |||||||||||||||||
Moody's | 260,500 | a | 260,500 | 6,981,400 | 6,981,400 | ||||||||||||||||
Nasdaq OMX Group | 12,400 | b | 20,000 | b | 32,400 | 245,768 | 396,400 | 642,168 | |||||||||||||
Nationwide Health Properties | 26,000 | d | 26,000 | 914,680 | 914,680 | ||||||||||||||||
New York Community Bancorp | 31,700 | 31,700 | 459,967 | 459,967 | |||||||||||||||||
NewAlliance Bancshares | 98,800 | 98,800 | 1,186,588 | 1,186,588 | |||||||||||||||||
Old Republic International | 34,700 | 34,700 | 348,388 | 348,388 | |||||||||||||||||
PartnerRe | 65,700 | 65,700 | 4,905,162 | 4,905,162 | |||||||||||||||||
People's United Financial | 300,000 | 300,000 | 5,010,000 | 5,010,000 | |||||||||||||||||
Potlatch | 29,200 | a,d | 29,200 | 930,896 | 930,896 | ||||||||||||||||
Principal Financial Group | 19,200 | 19,200 | 461,568 | 461,568 | |||||||||||||||||
Protective Life | 235,500 | 235,500 | 3,897,525 | 3,897,525 | |||||||||||||||||
Public Storage | 32,300 | a | 32,300 | 2,630,835 | 2,630,835 | ||||||||||||||||
Raymond James Financial | 196,600 | a | 34,200 | 230,800 | 4,673,182 | 812,934 | 5,486,116 | ||||||||||||||
Regency Centers | 20,700 | a | 20,700 | 725,742 | 725,742 | ||||||||||||||||
Reinsurance Group of America | 13,500 | 13,500 | 643,275 | 643,275 | |||||||||||||||||
RenaissanceRe Holdings | 3,500 | 3,500 | 186,025 | 186,025 | |||||||||||||||||
StanCorp Financial Group | 32,400 | 32,400 | 1,296,648 | 1,296,648 | |||||||||||||||||
TD Ameritrade Holding | 220,400 | b | 220,400 | 4,271,352 | 4,271,352 | ||||||||||||||||
Transatlantic Holdings | 21,700 | 21,700 | 1,130,787 | 1,130,787 | |||||||||||||||||
UDR | 165,000 | 165,000 | 2,712,600 | 2,712,600 | |||||||||||||||||
Unitrin | 13,000 | 13,000 | 286,650 | 286,650 | |||||||||||||||||
Validus Holdings | 40,400 | 40,400 | 1,088,376 | 1,088,376 | |||||||||||||||||
Weingarten Realty Investors | 41,600 | a,d | 41,600 | 823,264 | 823,264 | ||||||||||||||||
Westamerica Bancorporation | 18,800 | a | 13,000 | a | 31,800 | 1,040,956 | 719,810 | 1,760,766 | |||||||||||||
67,249,299 | 21,269,429 | 28,340,779 | 116,859,507 | ||||||||||||||||||
Health Care--13.9% | |||||||||||||||||||||
Celgene | 12,600 | a,b | 107,000 | b | 119,600 | 786,366 | 5,957,760 | 6,744,126 | |||||||||||||
Charles River Laboratories International | 9,300 | b | 9,300 | 313,317 | 313,317 | ||||||||||||||||
Cooper | 9,400 | 9,400 | 358,328 | 358,328 | |||||||||||||||||
Edwards Lifesciences | 40,000 | b | 40,000 | 3,474,000 | 3,474,000 | ||||||||||||||||
Endo Pharmaceuticals Holdings | 125,200 | b | 45,400 | b | 170,600 | 2,567,852 | 931,154 | 3,499,006 | |||||||||||||
Express Scripts | 3,900 | b | 3,900 | 337,155 | 337,155 | ||||||||||||||||
Forest Laboratories | 145,600 | b | 145,600 | 4,675,216 | 4,675,216 | ||||||||||||||||
Gilead Sciences | 130,000 | b | 130,000 | 5,626,400 | 5,626,400 | ||||||||||||||||
Henry Schein | 24,400 | b | 24,400 | 1,283,440 | 1,283,440 | ||||||||||||||||
Hospira | 115,700 | b | 115,700 | 5,900,700 | 5,900,700 | ||||||||||||||||
Humana | 97,800 | b | 26,300 | b | 124,100 | 4,292,442 | 1,154,307 | 5,446,749 | |||||||||||||
IMS Health | 181,900 | 181,900 | 3,830,814 | 3,830,814 | |||||||||||||||||
Kinetic Concepts | 109,000 | a,b | 24,100 | a,b | 133,100 | 4,103,850 | 907,365 | 5,011,215 | |||||||||||||
Laboratory Corp. of America Holdings | 17,700 | b | 17,700 | 1,324,668 | 1,324,668 | ||||||||||||||||
Life Technologies | 151,000 | b | 151,000 | 7,886,730 | 7,886,730 | ||||||||||||||||
LifePoint Hospitals | 22,600 | a,b | 22,600 | 734,726 | 734,726 | ||||||||||||||||
Mettler-Toledo International | 53,100 | a,b | 53,100 | 5,574,969 | 5,574,969 | ||||||||||||||||
Millipore | 75,600 | b | 75,600 | 5,469,660 | 5,469,660 | ||||||||||||||||
Mylan | 107,700 | a,b | 250,000 | a,b | 357,700 | 1,984,911 | 4,607,500 | 6,592,411 | |||||||||||||
Omnicare | 238,300 | a | 31,400 | 269,700 | 5,762,094 | 759,252 | 6,521,346 | ||||||||||||||
OSI Pharmaceuticals | 30,200 | a,b | 30,200 | 937,106 | 937,106 | ||||||||||||||||
Perrigo | 94,200 | 94,200 | 3,752,928 | 3,752,928 | |||||||||||||||||
Resmed | 17,400 | b | 17,400 | 909,498 | 909,498 | ||||||||||||||||
STERIS | 32,900 | a | 32,900 | 920,213 | 920,213 | ||||||||||||||||
Techne | 22,000 | 22,000 | 1,508,320 | 1,508,320 | |||||||||||||||||
Tenet Healthcare | 352,900 | b | 352,900 | 1,902,131 | 1,902,131 | ||||||||||||||||
Universal Health Services, Cl. B | 194,400 | 22,000 | 216,400 | 5,929,200 | 671,000 | 6,600,200 | |||||||||||||||
Valeant Pharmaceuticals International | 127,600 | a,b | 36,800 | a,b | 164,400 | 4,056,404 | 1,169,872 | 5,226,276 | |||||||||||||
Vertex Pharmaceuticals | 8,000 | b | 140,000 | a,b | 148,000 | 342,800 | 5,999,000 | 6,341,800 | |||||||||||||
61,914,205 | 12,229,698 | 34,559,545 | 108,703,448 | ||||||||||||||||||
Industrial--9.2% | |||||||||||||||||||||
AGCO | 14,250 | a,b | 14,250 | 460,845 | 460,845 | ||||||||||||||||
Alliant Techsystems | 23,600 | a,b | 23,600 | 2,083,172 | 2,083,172 | ||||||||||||||||
Brink's | 32,300 | 10,100 | 42,400 | 786,182 | 245,834 | 1,032,016 | |||||||||||||||
Bucyrus International | 26,400 | 26,400 | 1,488,168 | 1,488,168 | |||||||||||||||||
Cameron International | 18,300 | b | 18,300 | 764,940 | 764,940 | ||||||||||||||||
C.H. Robinson Worldwide | 110,000 | a | 110,000 | 6,460,300 | 6,460,300 | ||||||||||||||||
Dun & Bradstreet | 4,400 | 8,000 | 12,400 | 371,228 | 674,960 | 1,046,188 | |||||||||||||||
Dycom Industries | 87,000 | b | 87,000 | 698,610 | 698,610 | ||||||||||||||||
Energizer Holdings | 3,200 | b | 3,200 | 196,096 | 196,096 | ||||||||||||||||
Fastenal | 142,000 | a | 142,000 | 5,912,880 | 5,912,880 | ||||||||||||||||
Flowserve | 4,400 | 83,000 | 87,400 | 415,932 | 7,845,990 | 8,261,922 | |||||||||||||||
Fluor | 28,000 | 6,000 | 34,000 | 1,261,120 | 270,240 | 1,531,360 | |||||||||||||||
Gentex | 29,900 | 29,900 | 533,715 | 533,715 | |||||||||||||||||
Goodrich | 56,000 | 56,000 | 3,598,000 | 3,598,000 | |||||||||||||||||
Granite Construction | 12,200 | a | 12,200 | 410,652 | 410,652 | ||||||||||||||||
Hubbell, Cl. B | 12,500 | 28,400 | 40,900 | 591,250 | 1,343,320 | 1,934,570 | |||||||||||||||
ITT | 23,500 | 23,500 | 1,168,890 | 1,168,890 | |||||||||||||||||
Jacobs Engineering Group | 13,900 | b | 100,000 | b | 113,900 | 522,779 | 3,761,000 | 4,283,779 | |||||||||||||
Joy Global | 22,500 | 22,500 | 1,160,775 | 1,160,775 | |||||||||||||||||
KBR | 17,600 | 17,600 | 334,400 | 334,400 | |||||||||||||||||
L-3 Communications Holdings | 11,500 | 11,500 | 999,925 | 999,925 | |||||||||||||||||
Landstar System | 88,000 | 88,000 | 3,411,760 | 3,411,760 | |||||||||||||||||
Oceaneering International | 16,200 | b | 16,200 | 948,024 | 948,024 | ||||||||||||||||
Oshkosh | 141,500 | 38,700 | 180,200 | 5,239,745 | 1,433,061 | 6,672,806 | |||||||||||||||
Patterson-UTI Energy | 16,800 | 16,800 | 257,880 | 257,880 | |||||||||||||||||
Pitney Bowes | 13,700 | 13,700 | 311,812 | 311,812 | |||||||||||||||||
R.R. Donnelley & Sons | 258,400 | 258,400 | 5,754,568 | 5,754,568 | |||||||||||||||||
SAIC | 48,800 | b | 48,800 | 924,272 | 924,272 | ||||||||||||||||
SEACOR Holdings | 8,400 | b | 8,400 | 640,500 | 640,500 | ||||||||||||||||
SPX | 91,100 | 91,100 | 4,983,170 | 4,983,170 | |||||||||||||||||
Stericycle | 10,000 | b | 10,000 | 551,700 | 551,700 | ||||||||||||||||
URS | 18,100 | b | 18,100 | 805,812 | 805,812 | ||||||||||||||||
Valmont Industries | 26,200 | a | 26,200 | 2,055,390 | 2,055,390 | ||||||||||||||||
W.W. Grainger | 30,000 | 30,000 | 2,904,900 | 2,904,900 | |||||||||||||||||
24,584,356 | 13,901,032 | 36,098,409 | 71,218,052 | ||||||||||||||||||
Information Technology--15.6% | |||||||||||||||||||||
Advent Software | 20,900 | b | 20,900 | 851,257 | 851,257 | ||||||||||||||||
Affiliated Computer Services, Cl. A | 14,600 | b | 14,600 | 871,474 | 871,474 | ||||||||||||||||
Amdocs | 70,000 | b | 70,000 | 1,997,100 | 1,997,100 | ||||||||||||||||
AU Optronics, ADR | 300,000 | a | 300,000 | 3,597,000 | 3,597,000 | ||||||||||||||||
Avnet | 31,900 | a,b | 19,400 | b | 51,300 | 962,104 | 585,104 | 1,547,208 | |||||||||||||
Broadridge Financial Solutions | 227,400 | 45,500 | 272,900 | 5,130,144 | 1,026,480 | 6,156,624 | |||||||||||||||
CA | 25,900 | 25,900 | 581,714 | 581,714 | |||||||||||||||||
Cognizant Technology Solutions, Cl. A | 12,300 | b | 12,300 | 557,190 | 557,190 | ||||||||||||||||
Computer Sciences | 20,800 | b | 9,800 | b | 30,600 | 1,196,624 | 563,794 | 1,760,418 | |||||||||||||
Convergys | 274,300 | a,b | 274,300 | 2,948,725 | 2,948,725 | ||||||||||||||||
Cree | 100,900 | b | 100,900 | 5,687,733 | 5,687,733 | ||||||||||||||||
Cypress Semiconductor | 472,600 | a,b | 110,400 | a,b | 583,000 | 4,990,656 | 1,165,824 | 6,156,480 | |||||||||||||
Diebold | 167,700 | 167,700 | 4,771,065 | 4,771,065 | |||||||||||||||||
Dolby Laboratories, Cl. A | 108,200 | a,b | 108,200 | 5,164,386 | 5,164,386 | ||||||||||||||||
DST Systems | 63,200 | b | 63,200 | 2,752,360 | 2,752,360 | ||||||||||||||||
F5 Networks | 21,200 | b | 21,200 | 1,123,176 | 1,123,176 | ||||||||||||||||
Fair Isaac | 30,300 | b | 30,300 | 645,693 | 645,693 | ||||||||||||||||
Fidelity National Information Services | 246,700 | 246,700 | 5,782,648 | 5,782,648 | |||||||||||||||||
Fiserv | 74,200 | b | 74,200 | 3,597,216 | 3,597,216 | ||||||||||||||||
FLIR Systems | 35,000 | a,b | 35,000 | 1,145,200 | 1,145,200 | ||||||||||||||||
Global Payments | 120,000 | 120,000 | 6,463,200 | 6,463,200 | |||||||||||||||||
Harris | 5,200 | 60,000 | 65,200 | 247,260 | 2,853,000 | 3,100,260 | |||||||||||||||
Informatica | 11,600 | b | 11,600 | 299,976 | 299,976 | ||||||||||||||||
Ingram Micro, Cl. A | 299,000 | b | 27,600 | b | 326,600 | 5,217,550 | 481,620 | 5,699,170 | |||||||||||||
Integrated Device Technology | 73,600 | b | 73,600 | 476,192 | 476,192 | ||||||||||||||||
Intersil, Cl. A | 40,800 | 40,800 | 625,872 | 625,872 | |||||||||||||||||
Intuit | 26,200 | a,b | 26,200 | 804,602 | 804,602 | ||||||||||||||||
Linear Technology | 130,000 | 130,000 | 3,970,200 | 3,970,200 | |||||||||||||||||
ManTech International, Cl. A | 4,500 | a,b | 4,500 | 217,260 | 217,260 | ||||||||||||||||
Microchip Technology | 190,000 | a | 190,000 | 5,521,400 | 5,521,400 | ||||||||||||||||
Micron Technology | 32,800 | b | 32,800 | 346,368 | 346,368 | ||||||||||||||||
Novell | 1,069,600 | b | 1,069,600 | 4,438,840 | 4,438,840 | ||||||||||||||||
SanDisk | 150,000 | a,b | 150,000 | 4,348,500 | 4,348,500 | ||||||||||||||||
Semtech | 10,400 | b | 10,400 | 176,904 | 176,904 | ||||||||||||||||
Sohu.com | 57,500 | a,b | 57,500 | 3,293,600 | 3,293,600 | ||||||||||||||||
Sun Microsystems | 117,600 | b | 117,600 | 1,101,912 | 1,101,912 | ||||||||||||||||
Sybase | 13,600 | a,b | 24,400 | b | 115,000 | a,b | 153,000 | 590,240 | 1,058,960 | 4,991,000 | 6,640,200 | ||||||||||
Synopsys | 68,100 | b | 68,100 | 1,517,268 | 1,517,268 | ||||||||||||||||
Tech Data | 43,300 | b | 19,000 | a,b | 62,300 | 2,020,378 | 886,540 | 2,906,918 | |||||||||||||
Teradata | 18,700 | b | 18,700 | 587,741 | 587,741 | ||||||||||||||||
ValueClick | 18,900 | b | 18,900 | 191,268 | 191,268 | ||||||||||||||||
VeriSign | 97,000 | b | 97,000 | 2,351,280 | 2,351,280 | ||||||||||||||||
Western Digital | 165,400 | b | 165,400 | 7,302,410 | 7,302,410 | ||||||||||||||||
Xilinx | 17,800 | 17,800 | 446,068 | 446,068 | |||||||||||||||||
73,661,173 | 16,017,669 | 30,843,234 | 120,522,076 | ||||||||||||||||||
Materials--9.7% | |||||||||||||||||||||
Airgas | 8,700 | 8,700 | 414,120 | 414,120 | |||||||||||||||||
Bemis | 12,560 | 12,560 | 372,404 | 372,404 | |||||||||||||||||
Cabot | 20,100 | 20,100 | 527,223 | 527,223 | |||||||||||||||||
Carlisle Cos. | 127,400 | 40,400 | 167,800 | 4,364,724 | 1,384,104 | 5,748,828 | |||||||||||||||
CF Industries Holdings | 8,100 | 8,100 | 735,318 | 735,318 | |||||||||||||||||
Commercial Metals | 282,700 | a | 282,700 | 4,424,255 | 4,424,255 | ||||||||||||||||
Crown Holdings | 162,400 | b | 15,800 | b | 168,000 | b | 346,200 | 4,154,192 | 404,164 | 4,297,440 | 8,855,796 | ||||||||||
Donaldson | 18,900 | 18,900 | 804,006 | 804,006 | |||||||||||||||||
Eastman Chemical | 99,500 | 99,500 | 5,993,880 | 5,993,880 | |||||||||||||||||
FMC | 93,000 | 93,000 | 5,185,680 | 5,185,680 | |||||||||||||||||
General Cable | 10,700 | a,b | 10,700 | 314,794 | 314,794 | ||||||||||||||||
International Paper | 209,400 | 209,400 | 5,607,732 | 5,607,732 | |||||||||||||||||
Huntsman | 47,300 | 47,300 | 534,017 | 534,017 | |||||||||||||||||
Minerals Technologies | 24,600 | 13,700 | 38,300 | 1,339,962 | 746,239 | 2,086,201 | |||||||||||||||
Nalco Holding | 171,600 | a | 171,600 | 4,377,516 | 4,377,516 | ||||||||||||||||
Pactiv | 214,400 | b | 23,100 | b | 237,500 | 5,175,616 | 557,634 | 5,733,250 | |||||||||||||
Plum Creek Timber | 32,100 | a | 32,100 | 1,212,096 | 1,212,096 | ||||||||||||||||
Reliance Steel & Aluminum | 126,800 | 27,800 | 154,600 | 5,480,296 | 1,201,516 | 6,681,812 | |||||||||||||||
Scotts Miracle-Gro, Cl. A | 16,400 | 16,400 | 644,684 | 644,684 | |||||||||||||||||
Sealed Air | 3,500 | 3,500 | 76,510 | 76,510 | |||||||||||||||||
Temple-Inland | 63,100 | 63,100 | 1,332,041 | 1,332,041 | |||||||||||||||||
Terra Industries | 11,500 | 11,500 | 370,185 | 370,185 | |||||||||||||||||
Timken | 35,300 | 35,300 | 836,963 | 836,963 | |||||||||||||||||
Titanium Metals | 50,200 | a,b | 50,200 | 628,504 | 628,504 | ||||||||||||||||
Valspar | 11,100 | 11,100 | 301,254 | 301,254 | |||||||||||||||||
Walter Energy | 91,700 | 91,700 | 6,905,927 | 6,905,927 | |||||||||||||||||
Worthington Industries | 230,900 | 72,000 | 302,900 | 3,017,863 | 941,040 | 3,958,903 | |||||||||||||||
51,898,329 | 12,536,211 | 10,229,359 | 74,663,899 | ||||||||||||||||||
Telecommunication Services--2.8% | |||||||||||||||||||||
CommScope | 60,900 | a,b | 35,700 | b | 96,600 | 1,615,677 | 947,121 | 2,562,798 | |||||||||||||
Crown Castle International | 147,000 | b | 147,000 | 5,738,880 | 5,738,880 | ||||||||||||||||
Frontier Communications | 280,000 | 280,000 | 2,186,800 | 2,186,800 | |||||||||||||||||
NeuStar, Cl. A | 13,600 | b | 13,600 | 313,344 | 313,344 | ||||||||||||||||
Qwest Communications International | 245,500 | a | 245,500 | 1,033,555 | 1,033,555 | ||||||||||||||||
RF Micro Devices | 1,119,300 | a,b | 1,119,300 | 5,339,061 | 5,339,061 | ||||||||||||||||
Telephone & Data Systems | 21,600 | 21,600 | 732,672 | 732,672 | |||||||||||||||||
US Cellular | 9,400 | b | 9,400 | 398,654 | 398,654 | ||||||||||||||||
Virgin Media | 219,500 | a | 219,500 | 3,694,185 | 3,694,185 | ||||||||||||||||
11,995,822 | 2,078,447 | 7,925,680 | 21,999,949 | ||||||||||||||||||
Transportation--0.1% | |||||||||||||||||||||
Con-way | 7,600 | 7,600 | 265,316 | 265,316 | |||||||||||||||||
Expeditors International of Washington | 13,400 | 13,400 | 465,382 | 465,382 | |||||||||||||||||
730,698 | 730,698 | ||||||||||||||||||||
Utilities--6.6% | |||||||||||||||||||||
AES | 170,000 | b | 170,000 | 2,262,700 | 2,262,700 | ||||||||||||||||
AGL Resources | 20,200 | 20,200 | 736,694 | 736,694 | |||||||||||||||||
American Water Works | 170,297 | 19,100 | 189,397 | 3,816,356 | 428,031 | 4,244,387 | |||||||||||||||
Atmos Energy | 15,900 | 15,900 | 467,460 | 467,460 | |||||||||||||||||
CMS Energy | 19,400 | a | 19,400 | 303,804 | 303,804 | ||||||||||||||||
Consolidated Edison | 82,100 | a | 82,100 | 3,729,803 | 3,729,803 | ||||||||||||||||
Covanta Holding | 16,300 | b | 16,300 | 294,867 | 294,867 | ||||||||||||||||
DPL | 168,400 | a | 168,400 | 4,647,840 | 4,647,840 | ||||||||||||||||
DTE Energy | 56,300 | 56,300 | 2,454,117 | 2,454,117 | |||||||||||||||||
IDACORP | 10,400 | a | 14,400 | 24,800 | 332,280 | 460,080 | 792,360 | ||||||||||||||
Integrys Energy | 128,500 | 128,500 | 5,395,715 | 5,395,715 | |||||||||||||||||
Northeast Utilities | 37,600 | 37,600 | 969,704 | 969,704 | |||||||||||||||||
NSTAR | 19,400 | 6,900 | 26,300 | 713,920 | 253,920 | 967,840 | |||||||||||||||
NV Energy | 397,200 | 99,600 | 496,800 | 4,917,336 | 1,233,048 | 6,150,384 | |||||||||||||||
ONEOK | 117,000 | 117,000 | 5,214,690 | 5,214,690 | |||||||||||||||||
PG & E | 63,200 | 63,200 | 2,821,880 | 2,821,880 | |||||||||||||||||
Pinnacle West Capital | 148,600 | 148,600 | 5,435,788 | 5,435,788 | |||||||||||||||||
Southern Union | 45,600 | 45,600 | 1,035,120 | 1,035,120 | |||||||||||||||||
UGI | 43,600 | 21,000 | 64,600 | 1,054,684 | 507,990 | 1,562,674 | |||||||||||||||
WESCO International | 31,700 | b | 31,700 | 856,217 | 856,217 | ||||||||||||||||
Westar Energy | 135,200 | 135,200 | 2,936,544 | 2,936,544 | |||||||||||||||||
Xcel Energy | 2,900 | 2,900 | 61,538 | 61,538 | |||||||||||||||||
39,089,038 | 6,267,708 | 7,985,380 | 51,079,426 | ||||||||||||||||||
Total Common Stocks | |||||||||||||||||||||
(cost $402,905,668, $107,515,552, $166,244,253 and $676,665,473, respectively) | 462,438,935 | 111,236,321 | 203,506,012 | 777,181,268 | |||||||||||||||||
Other Investment--1.3% | |||||||||||||||||||||
Registered Investment Company; | |||||||||||||||||||||
Dreyfus Institutional Preferred | |||||||||||||||||||||
Plus Money Market Fund | |||||||||||||||||||||
(cost $5,831,000, $1,182,000, $3,058,000 and $10,071,000, respectively) | |||||||||||||||||||||
5,831,000 | c | 1,182,000 | c | 3,058,000 | c | 10,071,000 | 5,831,000 | 1,182,000 | 3,058,000 | 10,071,000 | |||||||||||
Investment of Cash Collateral for | |||||||||||||||||||||
Securities Loaned--16.0% | |||||||||||||||||||||
Registered Investment Company; | |||||||||||||||||||||
Dreyfus Institutional Cash | |||||||||||||||||||||
Advantage Fund | 76,044,585 | c | 76,044,585 | 76,044,585 | 76,044,585 | ||||||||||||||||
Dreyfus Institutional Cash | |||||||||||||||||||||
Advantage Plus Fund | 15,717,597 | c | 32,854,928 | c | 48,572,525 | 15,717,597 | 32,854,928 | 48,572,525 | |||||||||||||
(cost $76,044,585, $15,717,597, $32,854,928 and $124,617,110, respectively) | 76,044,585 | 15,717,597 | 32,854,928 | 124,617,110 | |||||||||||||||||
Total Investments (cost $484,781,253, $124,415,149, $202,157,181 and $811,353,583, respectively) | 117.0% | 544,314,520 | 128,135,918 | 239,418,940 | 911,869,378 | ||||||||||||||||
Liabilities, Less Cash and Receivables | (17.1%) | (81,576,330) | (16,686,201) | (33,937,451) | (132,199,982) | ||||||||||||||||
Net Assets | 100.0% | 462,738,190 | 111,449,717 | 205,481,489 | 779,669,396 |
ADR - American Depository Receipts
a | Security, or portion thereof, on loan. At December 31, 2009, the total market value of securities on loan is $73,359,619, $15,341,553, $31,661,848 and $120,363,020, respectively and the total market value of the collateral held by the funds is $76,044,585, $15,717,597, $32,854,928 and $124,617,110, respectively. |
b | Non-income producing security. |
c | Investment in affiliated money market mutual fund. |
d | Investment in real estate investment trust. |
* As of 12/31/2009, all of the securities held by Dreyfus Structured Midcap Fund and Dreyfus S&P STARS Opportunities Fund comport with the investment strategies and restrictions of Dreyfus Active MidCap Fund and management does not anticipate having to dispose of any securities as a result of the merger.
See notes to unaudited pro forma financial statements.
Dreyfus Active MidCap Fund |
Pro Forma Statement of Assets and Liabilities |
December 31, 2009 (Unaudited) |
Dreyfus Active MidCap Fund | Dreyfus Structured Midcap Fund | Dreyfus S&P STARS Opportunities Fund | Adjustments | Dreyfus Active MidCap Fund Pro Forma Combined (Note 1) | ||||||||||||||||||
ASSETS ($): | Investments in securities, at value - See Statement of Investments* | |||||||||||||||||||||
Unaffiliated issuers | 462,438,935 | 111,236,321.00 | 203,506,012.00 | 777,181,268 | ||||||||||||||||||
Affiliated issuers | 81,875,585 | 16,899,597 | 35,912,928 | 134,688,110 | ||||||||||||||||||
Receivable for investment securities sold | 4,780,300 | - | - | 4,780,300 | ||||||||||||||||||
Dividends and interest receivable | 635,198 | 109,015 | 131,902 | 876,115 | ||||||||||||||||||
Receivable for shares of Common Stock subscribed | 36,324 | 116,374 | 119,193 | 271,891 | ||||||||||||||||||
Prepaid expenses | 16,125 | 15,995 | 14,279 | 46,399 | ||||||||||||||||||
Total Assets | 549,782,467 | 128,377,302 | 239,684,314 | 917,844,083 | ||||||||||||||||||
LIABILITIES ($): | Due to The Dreyfus Corporation and affiliates | 431,749 | 108,124 | 161,296 | 701,169 | |||||||||||||||||
Cash overdraft due to Custodian | 4,737,010 | 809,456 | 813,202 | 6,359,668 | ||||||||||||||||||
Liability for securities on loan | 76,044,585 | 15,717,597 | 32,854,928 | 124,617,110 | ||||||||||||||||||
Payable for shares of Common Stock redeemed | 5,480,964 | 175,923 | 104,870 | 5,761,757 | ||||||||||||||||||
Accrued expenses | 349,969 | 116,485 | 268,529 | 734,983 | ||||||||||||||||||
Total Liabilities | 87,044,277 | 16,927,585 | 34,202,825 | 138,174,687 | ||||||||||||||||||
NET ASSETS ($) | 462,738,190 | 111,449,717 | 205,481,489 | 779,669,396 | ||||||||||||||||||
REPRESENTED BY ($): | Paid-in capital | 685,186,985 | 157,341,004 | 254,766,320 | 1,097,294,309 | |||||||||||||||||
Accumulated undistributed investment income - net | 398,049 | 36,841 | 110,418 | 545,308 | ||||||||||||||||||
Accumulated net realized gain (loss) on investments | (282,380,111 | ) | (49,648,897 | ) | (86,657,008 | ) | (418,686,016 | ) | ||||||||||||||
Accumulated net unrealized appreciation (depreciation) on investments | 59,533,267 | 3,720,769 | 37,261,759 | 100,515,795 | ||||||||||||||||||
NET ASSETS ($) | 462,738,190 | 111,449,717 | 205,481,489 | 779,669,396 | ||||||||||||||||||
Dreyfus Structured Midcap Fund, Class A shares (100 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 45,338,606 | ||||||||||||||||||||
Shares outstanding | 2,997,235 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 15.13 | ||||||||||||||||||||
Maximum offering price per share (net asset value plus maximum sales charge) | $ | 16.05 | ||||||||||||||||||||
Dreyfus Structured Midcap Fund, Class B shares (100 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 2,018,065 | ||||||||||||||||||||
Shares outstanding | 141,958 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 14.22 | ||||||||||||||||||||
Dreyfus Structured Midcap Fund, Class C shares (100 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 11,655,979 | ||||||||||||||||||||
Shares outstanding | 817,489 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 14.26 | ||||||||||||||||||||
Dreyfus Structured Midcap Fund, Class I shares (100 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 52,437,067 | ||||||||||||||||||||
Shares outstanding | 3,430,019 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 15.29 | ||||||||||||||||||||
Dreyfus S&P STARS Opportunities Fund, Class A shares (unlimited number of $.001 par value shares of Beneficial Interest authorized) | ||||||||||||||||||||||
Net Assets | $ | 124,677,505 | ||||||||||||||||||||
Shares outstanding | 6,749,519 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 18.47 | ||||||||||||||||||||
Maximum offering price per share (net asset value plus maximum sales charge) | $ | 19.60 | ||||||||||||||||||||
Dreyfus S&P STARS Opportunities Fund, Class B shares (unlimited number of $.001 par value shares of Beneficial Interest authorized) | ||||||||||||||||||||||
Net Assets | $ | 6,613,826 | ||||||||||||||||||||
Shares outstanding | 377,933 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 17.50 | ||||||||||||||||||||
Dreyfus S&P STARS Opportunities Fund, Class C shares (unlimited number of $.001 par value shares of Beneficial Interest authorized) | ||||||||||||||||||||||
Net Assets | $ | 28,328,010 | ||||||||||||||||||||
Shares outstanding | 1,617,195 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 17.52 | ||||||||||||||||||||
Dreyfus S&P STARS Opportunities Fund, Class I shares (unlimited number of $.001 par value shares of Beneficial Interest authorized) | ||||||||||||||||||||||
Net Assets | $ | 45,862,148 | ||||||||||||||||||||
Shares outstanding | 2,412,898 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 19.01 | ||||||||||||||||||||
Dreyfus Active MidCap Fund, Class A Shares (35 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 445,290,042 | $ | 170,016,111 | (a) | $ | 615,306,153 | |||||||||||||||
Shares outstanding | 15,889,262 | 6,067,515 | (a) | 21,956,777 | ||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 28.02 | $ | 28.02 | ||||||||||||||||||
Maximum offering price per share (net asset value plus maximum sales charge) | $ | 29.73 | $ | 29.73 | ||||||||||||||||||
Dreyfus Active MidCap Fund, Class B Shares (30 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 4,928,774 | $ | 8,631,891 | (a) | $ | 13,560,665 | |||||||||||||||
Shares outstanding | 183,579 | 321,507 | (a) | 505,086 | ||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 26.85 | $ | 26.85 | ||||||||||||||||||
Dreyfus Active MidCap Fund, Class C Shares (15 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 8,407,308 | $ | 39,983,989 | (a) | $ | 48,391,297 | |||||||||||||||
Shares outstanding | 312,423 | 1,486,089 | (a) | 1,798,512 | ||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 26.91 | $ | 26.91 | ||||||||||||||||||
Dreyfus Active MidCap Fund, Class I Shares (15 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 4,112,066 | $ | 98,299,215 | (a) | $ | 102,411,281 | |||||||||||||||
Shares outstanding | 145,003 | 3,466,650 | (a) | 3,611,653 | ||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 28.36 | $ | 28.36 | ||||||||||||||||||
* Investments in securities, at cost | ||||||||||||||||||||||
Unaffiliated issuers | $ | 402,905,668 | $ | 107,515,552 | $ | 166,244,253 | $ | 676,665,473 | ||||||||||||||
Affiliated issuers | $ | 81,875,585 | $ | 16,899,597 | $ | 35,912,928 | $ | 134,688,110 | ||||||||||||||
Market value of securities on loan | $ | 73,359,619 | $ | 15,341,553 | $ | 31,661,848 | $ | 120,363,020 |
(a) Adjustment to reflect the exchange of shares outstanding from Dreyfus S&P STARS Opportunities Fund and Dreyfus Structured Midcap Fund into Dreyfus Active MidCap Fund.
See notes to unaudited pro forma financial statements.
Dreyfus Active MidCap Fund |
Pro Forma Statement of Operations |
December 31, 2009 (Unaudited) |
Dreyfus Active MidCap Fund | Dreyfus Structured Midcap Fund | Dreyfus S&P STARS Opportunities Fund | Adjustments | Dreyfus Active MidCap Fund Pro Forma Combined (Note 1) | ||||||||||||||||||
INVESTMENT INCOME: | ||||||||||||||||||||||
INCOME: | Cash Dividends (net of $20,463 foreign taxes withheld on Dreyfus S&P STARS Opportunities Fund | |||||||||||||||||||||
Unaffiliated issuers | $ | 8,493,293 | $ | 2,000,351 | $ | 3,102,911 | $ | 13,596,555 | ||||||||||||||
Affiliated issuers | 3,569 | 2,431 | 9,517 | 15,517 | ||||||||||||||||||
Income from securities lending | 494,846 | 67,923 | 360,551 | 923,320 | ||||||||||||||||||
Interest Income | - | - | 4,135 | 4,135 | ||||||||||||||||||
Total Income | 8,991,708 | 2,070,705 | 3,477,114 | 14,539,527 | ||||||||||||||||||
EXPENSES: | Management fee | 3,196,911 | 776,015 | 1,540,153 | $ | 110,011 | (a) | 5,623,090 | ||||||||||||||
Shareholder servicing costs | 2,120,276 | 456,457 | 1,149,933 | (200,000 | ) | (a) | 3,526,666 | |||||||||||||||
Distribution fees | 101,969 | 100,710 | 337,793 | 540,472 | ||||||||||||||||||
Professional fees | 88,763 | 36,382 | 63,380 | (97,525 | ) | (a) | 91,000 | |||||||||||||||
Registration fees | 57,572 | 78,887 | 61,286 | (122,745 | ) | (a) | 75,000 | |||||||||||||||
Prospectus and shareholders' reports | 56,515 | - | 67,467 | (50,000 | ) | (a) | 73,982 | |||||||||||||||
Custodian fees | 45,239 | 20,392 | 19,915 | (15,500 | ) | (a) | 70,046 | |||||||||||||||
Directors'/Trustees' fees and expenses | 35,907 | 8,814 | 19,423 | (26,000 | ) | (a) | 38,144 | |||||||||||||||
Loan commitment fees | 4,029 | 637 | 530 | 5,196 | ||||||||||||||||||
Interest expense | 368 | - | 885 | 1,253 | ||||||||||||||||||
License fees | - | - | 331,173 | (331,173 | ) | (a) | - | |||||||||||||||
Miscellaneous | 44,734 | 17,123 | 28,821 | 10,000 | (a) | 100,678 | ||||||||||||||||
Total Expenses | 5,752,283 | 1,495,417 | 3,620,759 | (722,932 | ) | 10,145,527 | ||||||||||||||||
Less- reduction in management fee due to undertaking | (426,184 | ) | (521,324 | ) | 197,763 | (b) | (749,745 | ) | ||||||||||||||
Less- reduction in fees due to earnings credits | (57,548 | ) | (8,161 | ) | (19,797 | ) | (85,506 | ) | ||||||||||||||
Net Expenses | 5,268,551 | 1,487,256 | 3,079,638 | (525,169 | ) | 9,310,276 | ||||||||||||||||
INVESTMENT INCOME (LOSS) - NET | 3,723,157 | 583,449 | 397,476 | 525,169 | 5,229,251 | |||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | ||||||||||||||||||||||
Net realized gain (loss) on investments: | (134,898,912 | ) | (23,504,901 | ) | (33,812,380 | ) | (192,216,193 | ) | ||||||||||||||
Net unrealized appreciation (depreciation) on investments | 257,839,035 | 50,296,884 | 75,397,634 | 383,533,553 | ||||||||||||||||||
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS | 122,940,123 | 26,791,983 | 41,585,254 | 191,317,360 | ||||||||||||||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ | 126,663,280 | $ | 27,375,432 | $ | 41,982,730 | $ | 525,169 | $ | 196,546,611 |
(a) Reflects the adjustment of expenses to be commensurate with those of the combined fund.
(b) Reflects the adjustment of management fee undertaking to be commensurate with those of the combined fund.
See notes to unaudited pro forma financial statements.
Dreyfus Active MidCap Fund
NOTES TO PRO FORMA FINANCIAL STATEMENTS (Unaudited)
NOTE 1--Basis of Combination:
At a meeting held on July 19, 2010, the Board of Directors of Strategic Funds, Inc., on behalf of Dreyfus Active MidCap Fund (the "Acquiring Fund"), and at a meeting held on June 29, 2010, the Board of Trustees of Dreyfus Manager Funds I, on behalf of Dreyfus S&P STARS Opportunities Fund, and the Board of Directors of Advantage Funds, Inc., on behalf of Dreyfus Structured Midcap Fund (Dreyfus S&P STARS Opportunities Fund and Dreyfus Structured Midcap Fund may be referred to herein individually as a "Fund" and collectively as the "Funds"), each approved an Agreement and Plan of Reorganization pursuant to which, subject to approval by shareholders of the respective Fund, the Fund will transfer all of its assets, subject to its liabilities, to the Acquiring Fund, in exchange for a number of Class A, Class B, Class C and Class I shares of the Acquiring Fund equal in value to the assets less liabilities of the respective Fund (each, an "Exchange"). The Acquiring Fund shares will then be distributed to the respective Fund's shareholders on a pro rata basis in liquidation of the Funds. Shareholders of each Fund will receive shares of the corresponding class of the Acquiring Fund in the respective Exchange.
Each Exchange will be accounted for as a tax-free merger of investment companies. The unaudited pro forma statements of investments and assets and liabilities reflect the financial position of the Acquiring Fund and the Funds on December 31, 2009. The unaudited pro forma statement of operations reflects the results of operations of the Acquiring Fund and the Funds for the twelve months ended December 31, 2009. These pro forma financial statements reflect the financial position and the results of operations assuming each Fund's shareholders approved the relevant Exchange as of January 1, 2009. Each Fund Exchange will be voted on separately by the respective Fund's shareholders and is not conditional upon shareholders approving the other Fund Exchange or on any other Exchange approvals. These pro forma financial statements have been derived from each Fund's and the Acquiring Fund's respective books and records utilized in calculating daily net asset value at the dates indicated above under accounting principles generally accepted in the United States ("GAAP"). Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its relative net assets. The historical cost of investment securities will be carried forward to the surviving entity and results of operations of the Acquiring Fund for prior periods will not be restated. The fiscal year end is December 31 for the Acquiring Fund, March 31 for Dreyfus S&P STARS Opportunities Fund and August 31 for Dreyfus Structured Midcap Fund.
The pro forma statements of investments, assets and liabilities and operations should be read in conjunction with the historical financial statements of the Funds and the Acquiring Fund included or incorporated by reference in the Statement of Additional Information of which the pro forma combined financial statements form a part. The pro forma combined financial statements are presented for information only and may not necessarily be representative of what the actual combined financial statements would have been had each Exchange occurred on December 31, 2009. The pro forma financial statements were prepared in accordance with GAAP, which may require the use of management estimates and assumptions. Actual results could differ from those estimates. Following the relevant Exchange, the Acquiring Fund will be the accounting survivor.
The funds enter into contracts that contain a variety of indemnifications. The funds' maximum exposure under these arrangements is unknown. The funds do not anticipate recognizing any loss related to these arrangements.
NOTE 2--Portfolio Valuation:
Investments in securities are valued at the last sales price on the securities exchange or national securities market on which such securities are primarily traded. Securities listed on the National Market System for which market quotations are available are valued at the official closing price or, if there is no official closing price that day, at the last sales price. 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, except for open short positions, where the asked price is used for valuation purposes. Bid price is used when no asked price is available. Registered investment companies that are not traded on an exchange are valued at their net asset value. When market quotations or official closing prices are not readily available, or are determined not to reflect accurately fair value, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded (for example, a foreign exchange or market), but before the fund calculates its net asset value, the fund may value these investments at fair value as determined in accordance with the procedures approved by the fund's Board. Fair valuing of securities may be determined with the assistance of a pricing service using calculations based on indices of domestic securities and other appropriate indicators, such as prices of relevant ADRs and futures contracts. For other securities that are fair valued by the Board, certain factors may be considered such as: fundamental analytical data, the nature and duration of restrictions on disposition, an evaluation of the forces that influence the market in which the securities are purchased and sold and public trading in similar securities of the issuer or comparable issuers. Financial futures are valued at the last sales price.
The fair value of a financial instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (i.e., the exit price). GAAP establishes a fair value hierarchy that prioritizes the inputs of valuation techniques used to measure fair value. This hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).
Additionally, GAAP provides guidance on determining whether the volume and activity in a market has decreased significantly and whether such a decrease in activity results in transactions that are not orderly. GAAP requires enhanced disclosures around valuation inputs and techniques used during annual and interim periods.
Various inputs are used in determining the value of the fund's investments relating to fair value measurements. These inputs are summarized in the three broad levels listed below:
Level 1---unadjusted quoted prices in active markets for identical investments.
Level 2---other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).
Level 3---significant unobservable inputs (including the fund's own assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
All of the investments in each fund are considered Level 1.
NOTE 3--Capital Shares:
The pro forma number of shares that would be issued was calculated by dividing the net assets of each class of shares of the respective Fund on December 31, 2009 by the net asset value per share of the corresponding class of the Acquiring Fund on December 31, 2009.
NOTE 4--Pro Forma Operating Expenses:
The accompanying pro forma statement of operations reflects changes in fund expenses as if each Exchange had taken place on January 1, 2009. The Dreyfus Corporation will bear the expenses of each Exchange.
NOTE 5--Federal Income Taxes:
Each fund has qualified as a "regulated investment company" under the Internal Revenue Code. After each Exchange, the Acquiring Fund intends to continue to qualify as a regulated investment company, if such qualification is in the best interests of its shareholders, by complying with the provisions available to certain investment companies, as defined in applicable sections of the Internal Revenue Code, and to make distributions of taxable income sufficient to relieve it from all, or substantially all, federal income taxes.
The identified cost of investments for the funds is substantially the same for both financial accounting and federal income tax purposes. The tax cost of investments will remain unchanged for the combined entity.
NOTE 6—Bank Line of Credit:
The Acquiring Fund and the Funds participate with other Dreyfus-managed funds in a $225 million unsecured credit facility led by Citibank, N.A. and a $300 million unsecured credit facility provided by The Bank of New York Mellon (each, a "Facility"), each to be utilized primarily for temporary or emergency purposes, including the financing of redemptions. In connection therewith, each fund has agreed to pay its pro rata portion of commitment fees for each Facility. Interest is charged to the fund based on rates determined pursuant to the terms of the respective Facility at the time of the borrowing.
DREYFUS S&P STARS OPPORTUNITIES FUND
c/o The Dreyfus Corporation
200 Park Avenue
New York, New York 10166
Dear Shareholder:
As a shareholder of Dreyfus S&P STARS Opportunities Fund (the "Fund"), you are being asked to vote on an Agreement and Plan of Reorganization to allow the Fund to transfer all of its assets in a tax-free reorganization to Dreyfus Active MidCap Fund (the "Acquiring Fund"), in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund and the assumption by the Acquiring Fund of the Fund's stated liabilities. The Fund is a series of Dreyfus Manager Funds I (the "Trust"). The Dreyfus Corporation ("Dreyfus") is the investment adviser to the Acquiring Fund and the Fund.
Management of Dreyfus has reviewed the funds in the Dreyfus Family of Funds and has concluded that it would be appropriate to consolidate certain funds having similar investment objectives and investment management policies and that would otherwise benefit fund shareholders. As a result of the review, management recommended to the Trust's Board that the Fund be consolidated with the Acquiring Fund. If the Agreement and Plan of Reorganization is approved and consummated for the Fund, you would no longer be a shareholder of the Fund, but would become a shareholder of the Acquiring Fund. Management believes that the reorganization will permit Fund shareholders to pursue substantially similar investment goals in a larger combined fund. The Acquiring Fund, like the Fund, normally invests in stocks of mid-cap companies. In addition, the Acquiring Fund has a better recent short-term performance record than the Fund. Management also believes that the reorganization should enable Fund shareholders to benefit from more efficient portfolio management and will eliminate the duplication of resources and costs associated with marketing and servicing the funds as separate entities.
After careful review, the Trust's Board of Trustees has unanimously approved the proposed reorganization. The Trust's Board of Trustees believes that the reorganization will permit Fund shareholders to pursue substantially similar investment goals in a larger combined fund. In addition, the Acquiring Fund has a better recent short-term performance record than the Fund. The Trust's Board of Trustees recommends that you read the enclosed materials carefully and then vote FOR the proposal.
Your vote is extremely important, no matter how large or small your Fund holdings.
To vote, you may use any of the following methods:
● | By Mail. Please complete, date and sign the enclosed proxy card and mail it in the enclosed, postage-paid envelope. |
● | By Internet. Have your proxy card available. Go to the website listed on the proxy card. Enter your control number from your proxy card. Follow the instructions on the website. |
● | By Telephone. Have your proxy card available. Call the toll-free number listed on the proxy card. Enter your control number from your proxy card. Follow the recorded instructions. |
● | In Person. Any shareholder who attends the meeting in person may vote by ballot at the meeting. |
Further information about the proposed reorganization is contained in the enclosed materials, which you should review carefully before you vote. If you have any questions after considering the enclosed materials, please call 1-800-554-4611.
Sincerely, | |
Bradley J. Skapyak President Dreyfus Manager Funds I |
September __, 2010
TRANSFER OF THE ASSETS OF
DREYFUS S&P STARS OPPORTUNITIES FUND
TO AND IN EXCHANGE FOR SHARES OF
DREYFUS ACTIVE MIDCAP FUND
QUESTIONS AND ANSWERS
The enclosed materials include a Prospectus/Proxy Statement containing information you need to make an informed decision. However, we thought it also would be helpful to begin by answering some of the important questions you might have about the proposed reorganization.
WHAT WILL HAPPEN TO MY DREYFUS S&P STARS OPPORTUNITIES FUND INVESTMENT IF THE PROPOSED REORGANIZATION IS APPROVED?
You will become a shareholder of Dreyfus Active MidCap Fund (the "Acquiring Fund"), an open-end investment company managed by The Dreyfus Corporation ("Dreyfus"), on or about January 27, 2011 (the "Closing Date"), and will no longer be a shareholder of Dreyfus S&P STARS Opportunities Fund (the "Fund"). You will receive Class A, Class B, Class C or Class I shares of the Acquiring Fund corresponding to your Class A, Class B, Class C or Class I shares of the Fund with a value equal to the value of your investment in the Fund as of the Closing Date. The Fund will then cease operations and will be terminated as a series of Dreyfus Manager Funds I (the "Trust").
WHAT ARE THE BENEFITS OF THE PROPOSED REORGANIZATION FOR ME?
The Trust's Board of Trustees believes that the reorganization will permit Fund shareholders to pursue substantially similar investment goals in a larger combined fund that also is managed by Dreyfus. By combining the Fund with the Acquiring Fund, which has substantially more assets than the Fund, Fund shareholders should benefit from more efficient portfolio management. In addition, the Acquiring Fund has a better recent short-term performance record than the Fund. The reorganization also will eliminate the duplication of resources and costs associated with marketing and servicing the funds as separate entities. Other potential benefits are described in the enclosed Prospectus/Proxy Statement.
DO THE FUNDS HAVE SIMILAR INVESTMENT GOALS AND STRATEGIES?
Yes. The Acquiring Fund and the Fund have substantially similar investment objectives and similar investment management policies, but use different investment processes and approaches to select stocks. The Fund seeks long-term capital appreciation and the Acquiring Fund seeks to maximize capital appreciation. Each fund normally invests primarily in stocks of mid-cap companies. To pursue its goal, the Fund normally invests at least 80% of its assets in securities that have been ranked at the time of purchase by Standard & Poor's ("S&P") analysts according to S&P's STock Appreciation Ranking System (or "STARS"). S&P's equity research staff analyzes and ranks stocks — with 5-STARS being the highest ranking and 1-STARS the lowest ranking. The Fund's portfolio managers principally use STARS to identify common stocks in the highest category (five-STARS) for purchase and in the lowest category (one-STARS) for short-selling. The Fund's portfolio managers generally select securities of companies that, at the time of purchase, have market capitalizations within the range of companies included in the Standard & Poor's® MidCap 400 Index. To pursue its goal, the Acquiring Fund normally invests at least 80% of its assets in the stocks of midsize companies. The Acquiring Fund defines "midsize companies" as companies included in the Russell MidcapÒ Index at the time of purchase. The Acquiring Fund's portfolio managers apply a systematic, quantitative investment approach designed to identify and exploit relative misvaluations primarily within mid-cap stocks in the U.S. stock market. The portfolio managers use a proprietary valuation model that identifies and ranks stocks to construct the Acquiring Fund's portfolio, focusing on stock selection as opposed to making proactive decisions as to industry or sector exposure. The Acquiring Fund generally attempts to have a neutral exposure to sectors, industries and capitalizations relative to the Russell Midcap Index. Dreyfus is the investment adviser to the Fund and the Acquiring Fund and provides day-to-day management of each fund's investments. MBSC Securities Corporation, a wholly-owned subsidiary of Dreyfus, distributes the shares of the Fund and the Acquiring Fund. For additional information regarding the Fund and the Acquiring Fund, please refer to the enclosed Prospectus/Proxy Statement.
WHAT ARE THE TAX CONSEQUENCES OF THE PROPOSED REORGANIZATION?
The reorganization will not be a taxable event for federal income tax purposes. Shareholders will not recognize any capital gain or loss as a direct result of the reorganization. A shareholder's tax basis and holding period in Fund shares will carry over to the shareholder's Acquiring Fund shares. As a condition to the closing of the reorganization, the Fund and the Acquiring Fund will receive an opinion of counsel to the effect that, for federal income tax purposes, the reorganization will qualify as a tax-free reorganization and, thus, no gain or loss will be recognized by the Fund, the Fund's shareholders, or the Acquiring Fund as a result of the reorganization. The Fund will distribute any undistributed net investment income and net realized capital gains (after reduction for any capital loss carryforward) prior to the reorganization, which distribution will be taxable to shareholders. Certain tax attributes of the Fund will carry over to the Acquiring Fund, including the ability of the Acquiring Fund to utilize the Fund's capital loss carryforward; however, the ability of the Acquiring Fund to utilize the Fund's capital loss carryforward will be subject to limitations.
WILL I ENJOY THE SAME PRIVILEGES AS A SHAREHOLDER OF THE ACQUIRING FUND THAT I CURRENTLY HAVE AS A SHAREHOLDER OF THE FUND?
Yes. You will continue to enjoy the same shareholder privileges such as the Fund Exchanges service, Dreyfus TeleTransfer Privilege, Dreyfus-Automatic Asset BuilderÒ, Dreyfus Payroll Savings Plan, Dreyfus Government Direct Deposit Privilege, Dreyfus Dividend Options, Dreyfus Auto-Exchange Privilege and Dreyfus Automatic Withdrawal Plan.
WILL THE PROPOSED REORGANIZATION RESULT IN A HIGHER MANAGEMENT FEE OR HIGHER TOTAL FUND EXPENSES?
Under their respective agreements with Dreyfus, the Fund has agreed to pay Dreyfus a management fee at the annual rate of 0.70% of the value of the Fund's average daily net assets, and the Acquiring Fund has agreed to pay Dreyfus a management fee at the annual rate of 0.75% of the value of the Acquiring Fund's average daily net assets. Pursuant to an existing undertaking, Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Fund until at least August 1, 2011, so that the direct expenses of Class A, Class B, Class C and Class I shares of the Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 1.30%, 2.05%, 2.05% and 1.05%, respectively. Because each class of shares of the Fund had a lower net expense ratio than the corresponding class of shares of the Acquiring Fund, as of each fund's most recent fiscal year end, after applicable fee waiver and/or expense reimbursement arrangements, if the reorganization is approved and consummated, Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of Class A, Class B, Class C and Class I shares of the Acquiring Fund, so that the net operating expenses of such classes of shares (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed the net operating expenses of Class A, Class B, Class C and Class I shares, respectively, of the Fund, as of its most recent fiscal year end (i.e., 1.30%, 2.05%, 2.05% and 1.05%, respectively). Dreyfus has agreed to continue this undertaking until at least January 31, 2012.
WILL I BE CHARGED A SALES CHARGE, REDEMPTION FEE OR CONTINGENT DEFERRED SALES CHARGE ("CDSC") AT THE TIME OF THE REORGANIZATION?
No. No sales charge, redemption fee or CDSC will be imposed at the time of the reorganization. Any subsequent investment in the Acquiring Fund will be subject to any applicable sales charges and any redemption of Class B or Class C shares (or Class A shares subject to a CDSC) of the Acquiring Fund received in the reorganization will be subject to the same CDSC as redemption of Class B or Class C shares (or Class A shares subject to a CDSC) of the Fund (calculated from the date of original purchase of Fund shares).
WHO WILL PAY THE EXPENSES OF THE PROPOSED REORGANIZATION?
Dreyfus, and not the Fund or the Acquiring Fund, will pay the expenses directly related to the proposed reorganization. As discussed further in the enclosed Prospectus/Proxy Statement, transaction costs associated with any repositioning of the Fund's portfolio in connection with the proposed reorganization of the Fund after consummation of the reorganization will be borne by the combined fund.
HOW DOES THE TRUST'S BOARD OF TRUSTEES RECOMMEND I VOTE?
After considering, among other factors, the terms and conditions of the reorganization, the investment management policies of, as well as shareholder services offered by, the Fund and the Acquiring Fund, fees and expenses, including the net expense ratios of the Fund and the Acquiring Fund, and the relative performance of the Fund and the Acquiring Fund, the Trust's Board of Trustees believes that reorganizing the Fund into the Acquiring Fund is in the best interests of the Fund and its shareholders. In reaching this conclusion, the Trust's Board of Trustees determined that reorganizing the Fund into the Acquiring Fund, which also is managed by Dreyfus and has a substantially similar investment objective and similar investment management policies as those of the Fund, offers potential benefits to Fund shareholders. These potential benefits include permitting Fund shareholders to pursue substantially similar investment goals in a larger combined fund. In addition, the Acquiring Fund has a better recent short-term performance record than the Fund. By combining the Fund with the Acquiring Fund, shareholders of the Fund also should benefit from more efficient portfolio management. Therefore, the Trust's Board of Trustees recommends that you vote FOR the reorganization.
HOW CAN I VOTE MY SHARES?
You can vote in any one of the following ways:
● | By mail, with the enclosed proxy card and postage-paid envelope; | |
● | By telephone, with a toll-free call to the number listed on your proxy card; | |
● | Through the Internet, at the website address listed on your proxy card; or | |
● | In person at the meeting. |
We encourage you to vote through the Internet or by telephone using the number that appears on your proxy card. Whichever voting method you choose, please take the time to read the Prospectus/Proxy Statement before you vote.
Please note: if you sign and date your proxy card, but do not provide voting instructions, your shares will be voted FOR the proposal. Thank you in advance for your vote.
DREYFUS S&P STARS OPPORTUNITIES FUND
__________________________
NOTICE OF SPECIAL MEETING OF SHAREHOLDERS
___________________________
To the Shareholders:
A Special Meeting of Shareholders of Dreyfus S&P STARS Opportunities Fund (the "Fund"), a series of Dreyfus Manager Funds I (the "Trust"), will be held at the offices of The Dreyfus Corporation, 200 Park Avenue, 8th Floor, New York, New York 10166, on Wednesday, November 17, 2010, at 10:00 a.m., for the following purposes:
1. | To approve an Agreement and Plan of Reorganization providing for the transfer of all of the assets of the Fund to Dreyfus Active MidCap Fund (the "Acquiring Fund"), in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund having an aggregate net asset value equal to the value of the Fund's net assets and the assumption by the Acquiring Fund of the Fund's stated liabilities (the "Reorganization"). Class A, Class B, Class C and Class I shares of the Acquiring Fund received by the Fund in the Reorganization will be distributed by the Fund to its Class A, Class B, Class C and Class I shareholders, respectively, in liquidation of the Fund, after which the Fund will cease operations and will be terminated as a series of the Trust; and |
2. | To transact such other business as may properly come before the meeting, or any adjournment or adjournments thereof. |
Shareholders of record at the close of business on September 1, 2010 will be entitled to receive notice of and to vote at the meeting.
By Order of the Board of Trustees | |
Michael A. Rosenberg Secretary |
New York, New York
September __, 2010
WE NEED YOUR PROXY VOTE |
A SHAREHOLDER MAY THINK HIS OR HER VOTE IS NOT IMPORTANT, BUT IT IS VITAL. BY LAW, THE MEETING OF SHAREHOLDERS WILL HAVE TO BE ADJOURNED WITHOUT CONDUCTING ANY BUSINESS IF LESS THAN A QUORUM OF FUND SHARES ELIGIBLE TO VOTE IS REPRESENTED. IN THAT EVENT, THE FUND WOULD CONTINUE TO SOLICIT VOTES IN AN ATTEMPT TO ACHIEVE A QUORUM. CLEARLY, YOUR VOTE COULD BE CRITICAL TO ENABLE THE FUND TO HOLD THE MEETING AS SCHEDULED, SO PLEASE RETURN YOUR PROXY CARD OR OTHERWISE VOTE PROMPTLY. YOU AND ALL OTHER SHAREHOLDERS WILL BENEFIT FROM YOUR COOPERATION. |
Transfer of the Assets of
DREYFUS S&P STARS OPPORTUNITIES FUND
(A Series of Dreyfus Manager Funds I)
To and in Exchange for Class A, Class B, Class C and Class I Shares of
DREYFUS ACTIVE MIDCAP FUND
(A Series of Strategic Funds, Inc.)
PROSPECTUS/PROXY STATEMENT
AUGUST __, 2010
_______________________________________
Special Meeting of Shareholders
To Be Held on Wednesday, November 17, 2010
This Prospectus/Proxy Statement is furnished in connection with a solicitation of proxies by the Board of Trustees of Dreyfus Manager Funds I (the "Trust"), on behalf of Dreyfus S&P STARS Opportunities Fund (the "Fund"), to be used at the Special Meeting of Shareholders (the "Meeting") of the Fund to be held on Wednesday, November 17, 2010, at 10:00 a.m., at the offices of The Dreyfus Corporation ("Dreyfus"), 200 Park Avenue, 8th Floor, New York, New York 10166, for the purposes set forth in the accompanying Notice of Special Meeting of Shareholders. Shareholders of record at the close of business on September 1, 2010 are entitled to receive notice of and to vote at the Meeting.
It is proposed that the Fund transfer all of its assets to Dreyfus Active MidCap Fund (the "Acquiring Fund"), in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund and the assumption by the Acquiring Fund of the Fund's stated liabilities, all as more fully described in this Prospectus/Proxy Statement (the "Reorganization"). Upon consummation of the Reorganization, the Acquiring Fund shares received by the Fund will be distributed to Fund shareholders, with each shareholder receiving a pro rata distribution of the Acquiring Fund's shares (or fractions thereof) for Fund shares held prior to the Reorganization. It is contemplated that each shareholder will receive for his or her Fund shares a number of Class A, Class B, Class C or Class I shares (or fractions thereof) of the Acquiring Fund equal in value to the aggregate net asset value of the shareholder's Class A, Class B, Class C or Class I Fund shares as of the date of the Reorganization. The Acquiring Fund shares received by each Fund shareholder will be of the same share class as the shareholder's Fund shares.
This Prospectus/Proxy Statement, which should be retained for future reference, concisely sets forth information about the Acquiring Fund that Fund shareholders should know before voting on the proposal or investing in the Acquiring Fund.
A Statement of Additional Information ("SAI") dated August __, 2010, relating to this Prospectus/Proxy Statement, has been filed with the Securities and Exchange Commission (the "Commission") and is incorporated by reference in its entirety. The Commission maintains a website (http://www.sec.gov) that contains the SAI, material incorporated in this Prospectus/Proxy Statement by reference, and other information regarding the Acquiring Fund and the Fund. A copy of the SAI is available without charge by calling 1-800-554-4611, or writing to the Acquiring Fund at its offices at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144.
Shares of the Acquiring Fund and the Fund are not bank deposits and are not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. Investing in the Acquiring Fund, as in the Fund, involves certain risks, including the possible loss of principal. |
The Securities and Exchange Commission has not approved or disapproved the Acquiring Fund's shares or passed upon the accuracy or adequacy of this Prospectus/Proxy Statement. Any representation to the contrary is a criminal offense. |
The Fund and the Acquiring Fund are open-end management investment companies advised by Dreyfus. The funds have substantially similar investment objectives and similar investment management policies. The Fund seeks long-term capital appreciation and the Acquiring Fund seeks to maximize capital appreciation. Each fund normally invests primarily in stocks of mid-cap companies. However, each fund uses different investment processes and approaches to select stocks, and the investment limitations of each fund (and the related risks) are not identical. The Acquiring Fund is a series of Strategic Funds, Inc. (the "Company"). A comparison of the Fund and the Acquiring Fund is set forth in this Prospectus/Proxy Statement.
The Acquiring Fund's Prospectus dated May 1, 2010, Annual Report for its fiscal year ended December 31, 2009 (including its audited financial statements for the fiscal year) and Semi-Annual Report for the six-month period ended June 30, 2010 accompany this Prospectus/Proxy Statement. The Acquiring Fund's Prospectus and the financial statements contained in its Annual Report are incorporated into this Prospectus/Proxy Statement by reference. For a free copy of the Fund's most recent Prospectus or Annual Report for its fiscal year ended March 31, 2010, please call your financial adviser, or call 1-800-554-4611, visit www.dreyfus.com or write to the Fund at its offices located at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144.
Shareholders are entitled to one vote for each Fund share held and fractional votes for each fractional Fund share held. Class A, Class B, Class C and Class I shareholders of the Fund will vote together on the proposal. Fund shares represented by executed and unrevoked proxies will be voted in accordance with the specifications made thereon. If the enclosed proxy card is executed and returned, it nevertheless may be revoked by giving another proxy before the Meeting. Also, any shareholder who attends the Meeting in person may vote by ballot at the Meeting, thereby canceling any proxy previously given. If you sign and date your proxy card, but do not provide voting instructions, your shares will be voted FOR the proposal.
As of July 30, 2010, the following numbers of Fund shares were issued and outstanding:
Class A Shares Outstanding | Class B Shares Outstanding | Class C Shares Outstanding | Class I Shares Outstanding | |||
Proxy materials will be mailed to shareholders of record on or about September 17, 2010.
TABLE OF CONTENTS
Summary | |
Reasons for the Reorganization | |
Information about the Reorganization | |
Additional Information about the Acquiring Fund and the Fund | |
Voting Information | |
Financial Statements and Experts | |
Other Matters | |
Notice To Banks, Broker/Dealers and Voting Trustees and Their Nominees | |
Exhibit A: Agreement and Plan of Reorganization | A-1 |
Exhibit B: Description of the Company's Board Members | B-1 |
APPROVAL OF AN AGREEMENT AND PLAN OF REORGANIZATION PROVIDING
FOR THE TRANSFER OF ALL OF THE FUND'S ASSETS TO THE ACQUIRING FUND
SUMMARY
This Summary is qualified by reference to the more complete information contained elsewhere in this Prospectus/Proxy Statement, the Acquiring Fund's Prospectus, the Fund's Prospectus and the Agreement and Plan of Reorganization (the "Plan") attached to this Prospectus/Proxy Statement as Exhibit A.
Proposed Transaction. The Trust's Board, all of whose members are not "interested persons" (as defined in the Investment Company Act of 1940, as amended (the "1940 Act")) of the Fund or the Acquiring Fund, has unanimously approved the Plan for the Fund. The Plan provides that, subject to the requisite approval of the Fund's shareholders, on the date of the Reorganization the Fund will assign, transfer and convey to the Acquiring Fund all of the assets of the Fund, including all securities and cash, in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund having an aggregate net asset value equal to the value of the Fund's net assets, and the Acquiring Fund will assume the Fund's stated liabilities. The Fund will distribute all Acquiring Fund shares received by it among its shareholders so that each Class A, Class B, Class C and Class I Fund shareholder will receive a pro rata distribution of the Acquiring Fund's Class A, Class B, Class C and Class I shares (or fractions thereof) having an aggregate net asset value equal to the aggregate net asset value of the shareholder's Fund shares as of the date of the Reorganization. The Acquiring Fund shares received by each Fund shareholder will be of the same share class as the shareholder's Fund shares. Thereafter, the Fund will cease operations and will be terminated as a series of the Trust.
As a result of the Reorganization, each Fund shareholder will cease to be a shareholder of the Fund and will become a shareholder of the Acquiring Fund as of the close of business on the date of the Reorganization. No sales charge, redemption fee or contingent deferred sales charge ("CDSC") will be imposed at the time of the Reorganization. Any subsequent investment in the Acquiring Fund after the Reorganization will be subject to any applicable sales charges, and any redemption of Class B or Class C shares (or Class A shares subject to a CDSC) of the Acquiring Fund received in the Reorganization will be subject to the same CDSC as the redemption of Class B or Class C shares (or Class A shares subject to a CDSC) of the Fund and would be calculated from the date of original purchase of Fund shares.
The Trust's Board has unanimously concluded that the Reorganization is in the best interests of the Fund and its shareholders and the interests of the Fund's existing shareholders will not be diluted as a result of the transactions contemplated thereby. See "Reasons for the Reorganization."
Federal Tax Consequences. As a condition to the closing of the Reorganization, the Fund and the Acquiring Fund will receive an opinion of counsel to the effect that, for federal income tax purposes, the Reorganization will qualify as a tax-free reorganization and, thus, no gain or loss will be recognized by the Fund, the Fund's shareholders, or the Acquiring Fund as a result of the Reorganization. Certain tax attributes of the Fund will carry over to the Acquiring Fund, including the ability of the Acquiring Fund to utilize the Fund's capital loss carryforward; however, the ability of the Acquiring Fund to utilize the Fund's capital loss carryforward will be subject to limitations. See "Information about the Reorganization — Federal Income Tax Consequences," " — Capital Loss Carryforward" and " — Sale of Portfolio Securities."
Comparison of the Fund and the Acquiring Fund. The following discussion is primarily a summary of certain parts of the Fund's Prospectus and the Acquiring Fund's Prospectus. Information contained in this Prospectus/Proxy Statement is qualified by the more complete information set forth in such Prospectuses, which are incorporated herein by reference.
Goal and Approach. The Fund and the Acquiring Fund have substantially similar investment objectives and similar investment management policies. The Fund seeks long-term capital appreciation and the Acquiring Fund seeks to maximize capital appreciation. Each fund's investment objective is a fundamental policy which cannot be changed without the approval of the holders of a majority (as defined in the 1940 Act) of the relevant fund's outstanding voting securities.
To pursue its goal, the Fund normally invests at least 80% of its net assets in securities that have been ranked at the time of purchase by Standard & Poor's ("S&P") analysts according to the Standard & Poor's STock Appreciation Ranking System (or "STARS"). S&P's equity research staff analyzes and ranks the stocks of approximately 1,500 issuers and evaluates their appreciation potential for the coming 12 months as shown below:
5-STARS (Strong Buy): Total return is expected to outperform the total return of a relevant benchmark by a wide margin over the coming 12 months, with shares rising in price on an absolute basis.
4-STARS (Buy): Total return is expected to outperform the total return of a relevant benchmark over the coming 12 months, with shares rising in price on an absolute basis.
3-STARS (Hold): Total return is expected to closely approximate that of the total return of a relevant benchmark over the coming 12 months, with shares generally rising in price on an absolute basis.
2-STARS (Sell): Total return is expected to underperform the total return of a relevant benchmark over the coming 12 months, and the share price is not anticipated to show a gain.
1-STARS (Strong Sell): Total return is expected to underperform the total return of a relevant benchmark by a wide margin over the coming 12 months, with shares falling in price on an absolute basis.
In seeking to achieve the investment objective of the Fund, the Fund's portfolio managers principally use STARS to identify common stocks in the highest category (five-STARS) for purchase and in the lowest category (one-STARS) for short-selling. This investment approach is designed to provide opportunities to achieve performance that exceeds the total return of the S&P MidCap 400 Index, the Fund's benchmark. The portfolio managers generally select for the Fund securities of companies that, at the time of purchase, have market capitalizations within the range of companies included in the S&P MidCap 400 Index.
Generally, the Fund invests at least 75% of its total assets in U.S. common stocks and U.S. dollar-denominated American Depositary Receipts ("ADRs") that are listed on U.S. exchanges that, at the time of initial purchase, were ranked five- or four-STARS, or at the time of the short sale, were ranked one- or two-STARS. The Fund, however, may invest up to 25% of its total assets in U.S. common stocks and ADRs without regard to STARS ranking at the time of purchase. This strategy will allow the Fund's portfolio managers to consider a larger universe of stocks that S&P does not follow, which means that the Fund may purchase more "lower-ranked" securities (or sell short more "higher-ranked" securities) than it otherwise could.
In selecting investments for the Fund, the Fund's portfolio managers analyze the stocks ranked by S&P analysts according to the STARS and select those they believe have the best potential for capital appreciation. The portfolio managers focus on companies that show the potential to achieve growth at a reasonable price. The Fund's portfolio managers consider various factors including market segment, industry, earnings history, price-to-earnings ratio and management.
If S&P downgrades a security held by the Fund to four-STARS from five-STARS, the Fund may purchase additional shares of that security without limitation. In addition, if S&P upgrades a security held by the Fund to two-STARS from one-STARS, the Fund may sell short additional shares of that security without limitation. If, however, S&P downgrades a security held by the Fund from five- or four-STARS to three-STARS or lower, that security is subject to the 25% limitation on acquiring securities without regard to STARS ranking. Similarly, if S&P upgrades a security sold short by the Fund from one- or two-STARS to three-STARS or higher, that security also is subject to the 25% limitation on investments made without regard to STARS ranking.
"Standard & Poor'sÒ", "S&PÒ" and "STARSÒ" are trademarks of Standard & Poor's and have been licensed for use. The Fund is not sponsored, managed, advised, sold or promoted by S&P.
To pursue its goal, the Acquiring Fund normally invests at least 80% of its assets in the stocks of midsize companies. The Acquiring Fund's stock investments may include common stocks, preferred stocks and convertible securities of U.S. and foreign issuers, including those purchased in initial public offerings ("IPOs"). The Acquiring Fund defines "midsize companies" as companies included in the Russell MidcapÒ Index at the time of purchase. The Acquiring Fund may continue to own stocks subsequently removed from the Russell Midcap Index, but would not expect to do so for extended periods due to the application of the portfolio managers' quantitative investment process described below.
The Acquiring Fund's portfolio managers apply a systematic, quantitative investment approach designed to identify and exploit relative misvaluations primarily within mid-cap stocks in the U.S. stock market. The Acquiring Fund's portfolio managers use a proprietary valuation model that identifies and ranks stocks (Composite Alpha Ranking or "CAR") based on:
● | a long-term relative valuation model that utilizes forward looking estimates of risk and return; |
● | an Earnings Sustainability ("ES") model that gauges how well earnings forecasts are likely to reflect changes in future cash flows. Measures of ES help stock selection strategy by tilting the Acquiring Fund's portfolio away from stocks with poor ES and tilting it towards stocks with strong ES; and |
● | a set of Behavioral Factors, including earnings revisions and share buybacks that provide the portfolio managers with information about potential misvaluations of stocks. |
The Acquiring Fund's portfolio managers construct the Acquiring Fund's portfolio through a systematic structured approach, focusing on stock selection as opposed to making proactive decisions as to industry or sector exposure. Within each sector and style subset, the Acquiring Fund overweights the most attractive stocks and underweights or zero weights the stocks that have been ranked least attractive. This approach differs from conventional portfolio management in that, generally, the Acquiring Fund's portfolio managers will strictly adhere to underlying models in selecting portfolio securities. In unusual circumstances, the Acquiring Fund's portfolio managers may deviate from the models.
The Acquiring Fund generally attempts to have a neutral exposure to sectors, industries and capitalizations relative to the Russell Midcap Index. The Acquiring Fund typically will hold between 100 and 250 securities selected using the models. The Acquiring Fund's portfolio managers will periodically rebalance the Acquiring Fund's portfolio, which will result in changes in portfolio holdings. The Acquiring Fund's portfolio managers may enhance the models from time to time, depending on their ongoing research efforts.
The S&P MidCap 400 Index and the Russell Midcap Index are unmanaged indexes designed to measure the performance of the midcap segment of the U.S. stock market. As of March 31, 2010, the market capitalization of the largest company in the S&P MidCap 400 Index was approximately $8.19 billion, and the weighted average and median market capitalizations of the S&P MidCap 400 Index were approximately $3.07 billion and $2.28 billion, respectively. As of March 31, 2010, the market capitalization of the largest company in the Russell Midcap Index was approximately $17.75 billion, and the weighted average and median market capitalizations of the Russell Midcap Index were approximately $6.81 billion and $3.68 billion, respectively.
The Fund and the Acquiring Fund may, but are not required to, use derivatives, such as options, and, with respect to the Fund only, futures and options on futures (including those relating to securities, indexes and foreign currencies), and forward contracts, as a substitute for investing directly in an underlying asset, to increase returns, to manage currency risk or as part of a hedging strategy. The Fund may "sell short" securities that at their time of initial sale were ranked one- or two-STARS. The Fund and the Acquiring Fund also may engage in short-selling, typically for hedging purposes, such as to limit exposure to a possible market decline in the value of its portfolio securities. Short-selling is considered "leverage," may involve substantial risk and could produce higher transaction costs and taxable distributions and lower the fund's after-tax performance. The Fund also is permitted to engage in leverage through borrowing money to purchase securities.
Neither fund has any limitation regarding portfolio turnover. The Fund and the Acquiring Fund may engage in short-term trading and each fund may have portfolio turnover rates in excess of 100%. A portfolio turnover rate of 100% is equivalent to a fund buying and selling all of the securities in its portfolio once during the course of a year. During its most recent fiscal year, the Fund's and the Acquiring Fund's portfolio turnover rates were 53.51% and 189.84%, respectively, of the average value of the respective fund's portfolio.
The Fund and the Acquiring Fund may lend their respective portfolio securities to brokers, dealers and other financial institutions needing to borrow securities to complete certain transactions. Loans of portfolio securities may not exceed 33-1/3% of the value of a fund's total assets.
The Fund is a "non-diversified" fund, which means that the proportion of the Fund's assets that may be invested in the securities of a single issuer is not limited by the 1940 Act. The Acquiring Fund is a "diversified" fund, which means that the Acquiring Fund will not, with respect to 75% of its total assets, invest more than 5% of its assets in the securities of any single issuer nor hold more than 10% of the outstanding voting securities of any single issuer (other than, in each case, securities of other investment companies, and securities issued or guaranteed by the U.S. government, its agencies or instrumentalities). The Acquiring Fund cannot change its diversified status without shareholder approval, but the Fund may elect to become a diversified fund without shareholder approval.
For more information on the Fund's or the Acquiring Fund's investment management policies, see "Goal and Approach" in the relevant Prospectus and "Description of the Company and Fund[s]" in the relevant Statement of Additional Information.
The Fund is a series of the Trust, which is an unincorporated business trust organized under the laws of the Commonwealth of Massachusetts. The Acquiring Fund is a series of the Company, which is a corporation organized under the laws of the State of Maryland. See "Certain Organizational Differences Between the Trust and the Company" below.
Investment Risks. The principal risks associated with an investment in the Fund and the Acquiring Fund are substantially similar. These risks are discussed below. An investment in the Acquiring Fund, as well as in the Fund, is not a bank deposit. It is not insured or guaranteed by the Federal Deposit Insurance Corporation or any other government agency. It is not a complete investment program. The value of your investment in the Acquiring Fund, as in the Fund, will fluctuate, sometimes dramatically, which means you could lose money.
● | Market risk. The market value of a security may decline due to general market conditions that are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. A security's market value also may decline because of factors that affect a particular industry or industries, such as labor shortages or increased production costs and competitive conditions within an industry. |
● | Issuer risk. The value of a security may decline for a number of reasons which directly relate to the issuer, such as management performance, financial leverage and reduced demand for the issuer's products or services. |
● | Smaller company risk. Investments in small and midsize companies carry additional risks because the operating histories of these companies tend to be more limited, their earnings and revenues less predictable (and some companies may be experiencing significant losses), and their share prices more volatile than those of larger, more established companies. The shares of smaller companies tend to trade less frequently than those of larger, more established companies, which can adversely affect the pricing of these securities and a fund's ability to sell these securities when deemed appropriate. These companies may have limited product lines, markets and/or financial resources, or may depend on a limited management group. Some of the Fund's and Acquiring Fund's investments will rise and fall based on investor perception rather than economic factors. Other investments are made in anticipation of future products, services or events whose delay or cancellation could cause the stock price to drop. |
● | Growth and value stock risk. By investing in a mix of growth and value companies, the funds assume the risks of both. Investors often expect growth companies to increase their earnings at a certain rate. If these expectations are not met, investors can punish the stocks inordinately, even if earnings do increase. In addition, growth stocks typically lack the dividend yield that can cushion stock prices in market downturns. Value stocks involve the risk that they may never reach their expected market value, either because the market fails to recognize the stock's intrinsic worth or the expected value was misgauged. They also may decline in price even though in theory they are already undervalued. |
● | Foreign investment risk. To the extent the Fund or the Acquiring Fund invests in foreign securities, its performance will be influenced by political, social and economic factors affecting investments in foreign companies. Special risks associated with investments in foreign companies include exposure to currency fluctuations, less liquidity, less developed or less efficient trading markets, lack of comprehensive company information, political and economic instability and differing auditing and legal standards. The securities of issuers located in emerging markets can be more volatile and less liquid than those of issuers in more mature economies. |
● | Foreign currency risk. Investments in foreign currencies are subject to the risk that those currencies will decline in value relative to the U.S. dollar, or, in the case of hedged positions, that the U.S. dollar will decline relative to the currency being hedged. Currency exchange rates may fluctuate significantly over short periods of time. A decline in the value of foreign currencies relative to the U.S. dollar will reduce the value of securities held by the Fund or the Acquiring Fund and denominated in those currencies. Foreign currencies also are subject to risks caused by inflation, interest rates, budget deficits and low savings rates, political factors and government controls. |
● | STARS rankings risk. (Fund only) S&P STARS rankings represent the subjective determination of S&P's analysts, and may not accurately assess the investment prospects of a particular security. Past performance of securities included in the S&P STARS system does not necessarily predict the future performance of the Fund. |
● | Non-diversification risk. (Fund only) The Fund is non-diversified, which means that a relatively high percentage of the Fund's assets may be invested in a limited number of issuers. Therefore, the Fund's performance may be more vulnerable to changes in the market value of a single issuer or group of issuers and more susceptible to risks associated with a single economic, political or regulatory occurrence than a diversified fund. |
In addition to the principal risks described above, the Fund and the Acquiring Fund, except as noted, are subject to the following additional risks.
● | Derivatives risk. A small investment in derivatives could have a potentially large impact on a fund's performance. The use of derivatives involves risks different from, or possibly greater than, the risks associated with investing directly in the underlying assets. Derivatives can be highly volatile, illiquid and difficult to value, and there is the risk that changes in the value of a derivative held by the Fund or the Acquiring Fund will not correlate with the underlying instruments or the fund's other investments. Derivative instruments also involve the risk that a loss may be sustained as a result of the failure of the counterparty to the derivative instruments to make required payments or otherwise comply with the derivative instruments' terms. Certain types of derivatives involve greater risks than the underlying obligations because, in addition to general market risks, they are subject to illiquidity risk, counterparty risk and credit risk. Additionally, some derivatives involve economic leverage, which could increase the volatility of these investments as they may fluctuate in value more than the underlying instrument. A fund may be required to segregate liquid assets in connection with the purchase of derivative instruments. |
● | Leveraging risk. The use of leverage, such as lending portfolio securities, engaging in forward commitment transactions, entering into forward currency contracts, and, for the Fund only, entering into futures contracts, borrowing money to purchase securities and engaging in reverse repurchase agreements, may magnify the respective fund's gains or losses. |
● | Short sale risk. The Fund and the Acquiring Fund may make short sales, which involves selling a security the fund does not own in anticipation that the security's price will decline. Short sales expose a fund to the risk that it will be required to buy the security sold short (also known as "covering" the short position) at a time when the security has appreciated in value, thus resulting in a loss to the fund. Short sales may involve substantial risk and "leverage." Short positions in stocks involve more risk than long positions in stocks because the maximum sustainable loss on a stock purchased is limited to the amount paid for the stock plus the transaction costs, whereas there is no maximum attainable price on the shorted stock. In theory, stocks sold short have unlimited risk. A fund may not always be able to close out a short position at a particular time or at an acceptable price. A fund may not always be able to borrow a security the fund seeks to sell short at a particular time or at an acceptable price. Thus, there is a risk that the Fund may be unable to fully implement its investment strategy due to a lack of available stocks or for some other reason. |
● | Market sector risk. (Fund only) The Fund may significantly overweight or underweight certain companies, industries or market sectors, which may cause its performance to be more or less sensitive to developments affecting those companies, industries or sectors. |
● | IPO risk. Although each fund typically invests in seasoned issuers, each fund may purchase securities of companies in IPOs or shortly thereafter. The prices of securities purchased in IPOs can be very volatile. The effect of IPOs on a fund's performance depends on a variety of factors, including the number of IPOs the fund invests in relative to the size of the fund and whether and to what extent a security purchased in an IPO appreciates or depreciates in value. As a fund's asset base increases, IPOs often have a diminished effect on such fund's performance. |
The Fund and the Acquiring Fund may lend their respective portfolio securities to brokers, dealers and other financial institutions. In connection with such loans, the respective fund will receive collateral from the borrower equal to at least 100% of the value of the loaned securities. If the borrower of the securities fails financially, there could be delays in recovering the loaned securities or exercising rights to the collateral.
The Fund and the Acquiring Fund may engage in short-term trading, which could produce higher transaction costs and taxable distributions and lower the respective fund's after-tax performance.
Under adverse market conditions, the Fund and the Acquiring Fund could invest some or all of their respective assets in U.S. Treasury securities and money market securities. Although the Fund or the Acquiring Fund would do this for temporary defensive purposes, this strategy could reduce the benefit from any upswing in the market. To the extent the Fund or the Acquiring Fund invests defensively in these securities, such fund might not achieve its investment objective. Each fund also may purchase money market instruments when it has cash reserves or in anticipation of taking a market position.
See "Investment Risks" in the relevant Prospectus and "Description of the Company and Fund[s]" in the relevant Statement of Additional Information, for a more complete description of investment risks.
Sales Charges. The schedules of sales charges imposed at the time of purchase of Class A shares of the Fund and the Acquiring Fund are identical. The CDSCs imposed at the time of redemption on Class B and Class C shares for the Fund and the Acquiring Fund are identical. Class I shares of each fund are not subject to any sales charges. See in the relevant Prospectus "Shareholder Guide" for a discussion of sales charges and the CDSC. No sales charge or CDSC will be imposed at the time of the Reorganization. Shares of the Fund and the Acquiring Fund currently are not subject to any exchange or redemption fees.
Fees and Expenses. Under their respective agreements with Dreyfus, the Fund has agreed to pay Dreyfus a management fee at the annual rate of 0.70% of the value of the Fund's average daily net assets, and the Acquiring Fund has agreed to pay Dreyfus a management fee at the annual rate of 0.75% of the value of the Acquiring Fund's average daily net assets. Pursuant to an existing undertaking, Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Fund until at least August 1, 2011, so that the direct expenses of Class A, Class B, Class C and Class I shares of the Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 1.30%, 2.05%, 2.05% and 1.05%, respectively. Because each class of shares of the Fund had a lower net expense ratio than the corresponding class of shares of the Acquiring Fund, as of each fund's most recent fiscal year end, after applicable fee waiver and/or expense reimbursement arrangements, if the Reorganization is approved and consummated, Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of Class A, Class B, Class C and Class I shares of the Acquiring Fund, so that the net operating expenses of such classes of shares (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed the net operating expenses of Class A, Class B, Class C and Class I shares, respectively, of the Fund, as of its most recent fiscal year end (i.e., 1.30%, 2.05%, 2.05% and 1.05%, respectively). Dreyfus has agreed to continue this undertaking until at least January 31, 2012. Without Dreyfus' current expense undertaking for the Fund, each class of shares of the Acquiring Fund, except for Class I shares, had a lower total expense ratio than the corresponding class of shares of the Fund, based on expenses of the funds, as of the respective fund's most recent fiscal year end.
The fees and expenses set forth below for the Fund are as of its fiscal year ended March 31, 2010, and for the Acquiring Fund are as of its fiscal year ended December 31, 2009. The "Pro Forma After Reorganization" operating expenses information set forth below is based on the fees and expenses of each fund as of the fiscal year end noted above, as adjusted showing the effect of the Reorganization. Annual fund operating expenses are paid out of fund assets, so their effect is reflected in the share prices.
Fund Class A | Acquiring Fund Class A | Pro Forma After Reorganization Acquiring Fund Class A | ||||
Shareholder fees (fees paid directly from your investment) | ||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | 5.75% | 5.75% | 5.75% | |||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | none1 | none1 | none1 | |||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||
Management fees | 0.70% | 0.75% | 0.75% | |||
Distribution (12b-1) fees | none | none | none | |||
Other expenses (including shareholder services fees) | 0.82%2 | 0.57% | 0.55% | |||
Total annual fund operating expenses | 1.52% | 1.32% | 1.30% | |||
Fee waiver and/or expense reimbursement | (0.22)%3 | N/A4 | N/A5 | |||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 1.30% | 1.32% | 1.30% | |||
Fund Class B | Acquiring Fund Class B | Pro Forma After Reorganization Acquiring Fund Class B | ||||
Shareholder fees (fees paid directly from your investment) | ||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | |||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | 4.00% | 4.00% | 4.00% | |||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||
Management fees | 0.70% | 0.75% | 0.75% | |||
Distribution (12b-1) fees | 0.75% | 0.75% | 0.75% | |||
Other expenses (including shareholder services fees) | 0.95%2 | 0.74% | 0.71% | |||
Total annual fund operating expenses | 2.40% | 2.24% | 2.21% | |||
Fee waiver and/or expense reimbursement | (0.35)%3 | N/A4 | (0.16)%5 | |||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 2.05% | 2.24% | 2.05% | |||
Fund Class C | Acquiring Fund Class C | Pro Forma After Reorganization Acquiring Fund Class C | ||||
Shareholder fees (fees paid directly from your investment) | ||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | |||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | 1.00% | 1.00% | 1.00% | |||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||
Management fees | 0.70% | 0.75% | 0.75% | |||
Distribution (12b-1) fees | 0.75% | 0.75% | 0.75% | |||
Other expenses (including shareholder services fees) | 0.76%2 | 0.64% | 0.56% | |||
Total annual fund operating expenses | 2.21% | 2.14% | 2.06% | |||
Fee waiver and/or expense reimbursement | (0.16)%3 | N/A4 | (0.01)%5 | |||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 2.05% | 2.14% | 2.05% | |||
Fund Class I | Acquiring Fund Class I | Pro Forma After Reorganization Acquiring Fund Class I | ||||
Shareholder fees (fees paid directly from your investment) | ||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | |||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | none | none | none | |||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||
Management fees | 0.70% | 0.75% | 0.75% | |||
Distribution (12b-1) fees | none | none | none | |||
Other expenses (including shareholder services fees) | 0.62%2 | 0.86% | 0.36% | |||
Total annual fund operating expenses | 1.32% | 1.61% | 1.11% | |||
Fee waiver and/or expense reimbursement | (0.27)%3 | N/A4 | (0.06)%5 | |||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 1.05% | 1.61% | 1.05% | |||
_______________________________
1 Shares bought without an initial sales charge as part of an investment of $1 million or more may be charged a CDSC of 1.00% if redeemed within one year.
2 "Other expenses" for the Fund include an annual 0.15% licensing fee payable by the Fund to S&P for the use of certain of S&P's proprietary tradenames and trademarks, pursuant to a license agreement between Dreyfus and S&P. The license agreement will be terminated if the Reorganization is approved and consummated.
3 Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Fund until at least August 1, 2011, so that the direct expenses of Class A, Class B, Class C and Class I shares of the Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 1.30%, 2.05%, 2.05% and 1.05%, respectively.
4 Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Acquiring Fund for the period June 1, 2010 through November 30, 2010, so that the direct expenses of Class A, Class B, Class C and Class I shares of the Acquiring Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 1.50%, 2.25%, 2.25% and 1.25%, respectively.
5 If the Reorganization is approved and consummated, Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Acquiring Fund until at least January 31, 2012, so that the net operating expenses of Class A, Class B, Class C and Class I shares of the Acquiring Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed the net operating expenses of the corresponding class of shares of the Fund as of the Fund's fiscal year ended March 31, 2010 (i.e., 1.30%, 2.05%, 2.05% and 1.05%, respectively).
Shareholders of another fund advised by Dreyfus—Dreyfus Structured Midcap Fund (the "Structured Fund")—also are being asked in separate proxy materials directed to them to approve an Agreement and Plan of Reorganization providing for the transfer of all of the Structured Fund's assets, subject to its liabilities, to the Acquiring Fund in exchange for shares of the Acquiring Fund. If approved by the Fund's shareholders, the Reorganization will be consummated for the Fund whether or not the shareholders of the Structured Fund approve the reorganization of the Structured Fund and the Acquiring Fund. The fees and expenses set forth below assume that shareholders of the Fund and of the Structured Fund approve the reorganizations of their respective funds into the Acquiring Fund. The fees and expenses set forth below for the Fund, the Structured Fund and the Acquiring Fund are as of their most recent fiscal year end (August 31, 2009 for the Structured Fund). The "Pro Forma After Reorganizations" operating expenses information set forth below is based on the fees and expenses of each fund as of the fiscal year end noted above, as adjusted showing the effect of the reorganizations.
Fund Class A | Structured Fund Class A | Acquiring Fund Class A | Pro Forma After Reorganization Acquiring Fund Class A | |||||
Shareholder fees (fees paid directly from your investment) | ||||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | 5.75% | 5.75% | 5.75% | 5.75% | ||||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | none1 | none1 | none1 | none1 | ||||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||||
Management fees | 0.70% | 0.75% | 0.75% | 0.75% | ||||
Distribution (12b-1) fees | none | none | none | none | ||||
Other expenses (including shareholder services fees) | 0.82%2 | 0.77% | 0.57% | 0.55% | ||||
Total annual fund operating expenses | 1.52% | 1.52% | 1.32% | 1.30% | ||||
Fee waiver and/or expense reimbursement | (0.22)%3 | N/A | N/A4 | N/A5 | ||||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 1.30% | 1.52% | 1.32% | 1.30% | ||||
Fund Class B | Structured Fund Class B | Acquiring Fund Class B | Pro Forma After Reorganization Acquiring Fund Class B | |||||
Shareholder fees (fees paid directly from your investment) | ||||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | none | ||||
�� | ||||||||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | 4.00% | 4.00% | 4.00% | 4.00% | ||||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||||
Management fees | 0.70% | 0.75% | 0.75% | 0.75% | ||||
Distribution (12b-1) fees | 0.75% | 0.75% | 0.75% | 0.75% | ||||
Other expenses (including shareholder services fees) | 0.95%2 | 0.84% | 0.74% | 0.71% | ||||
Total annual fund operating expenses | 2.40% | 2.34% | 2.24% | 2.21% | ||||
Fee waiver and/or expense reimbursement | (0.35)%3 | N/A | N/A4 | (0.16)%5 | ||||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 2.05% | 2.34% | 2.24% | 2.05% | ||||
Fund Class C | Structured Fund Class C | Acquiring Fund Class C | Pro Forma After Reorganization Acquiring Fund Class C | |||||
Shareholder fees (fees paid directly from your investment) | ||||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | none | ||||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | 1.00% | 1.00% | 1.00% | 1.00% | ||||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||||
Management fees | 0.70% | 0.75% | 0.75% | 0.75% | ||||
Distribution (12b-1) fees | 0.75% | 0.75% | 0.75% | 0.75% | ||||
Other expenses (including shareholder services fees) | 0.76%2 | 0.73% | 0.64% | 0.56% | ||||
Total annual fund operating expenses | 2.21% | 2.23% | 2.14% | 2.06% | ||||
Fee waiver and/or expense reimbursement | (0.16)%3 | N/A | N/A4 | (0.01)%5 | ||||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 2.05% | 2.23% | 2.14% | 2.05% | ||||
Fund Class I | Structured Fund Class I | Acquiring Fund Class I | Pro Forma After Reorganization Acquiring Fund Class I | |||||
Shareholder fees (fees paid directly from your investment) | ||||||||
Maximum sales charge (load) imposed on purchases (as a percentage of offering price) | none | none | none | none | ||||
Maximum deferred sales charge (load) (as a percentage of lower of purchase or sale price) | none | none | none | none | ||||
Annual fund operating expenses (expenses that you pay each year as a percentage of the value of your investment) | ||||||||
Management fees | 0.70% | 0.75% | 0.75% | 0.75% | ||||
Distribution (12b-1) fees | none | none | none | none | ||||
Other expenses (including shareholder services fees) | 0.62%2 | 0.43% | 0.86% | 0.36% | ||||
Total annual fund operating expenses | 1.32% | 1.18% | 1.61% | 1.11% | ||||
Fee waiver and/or expense reimbursement | (0.27)%3 | N/A | N/A4 | (0.06)%5 | ||||
Total annual fund operating expenses (after fee waiver and/or expense reimbursement) | 1.05% | 1.18% | 1.61% | 1.05% | ||||
_______________________________
1 Shares bought without an initial sales charge as part of an investment of $1 million or more may be charged a CDSC of 1.00% if redeemed within one year.
2 "Other expenses" for the Fund include an annual 0.15% licensing fee payable by the Fund to S&P for the use of certain of S&P's proprietary tradenames and trademarks, pursuant to a license agreement between Dreyfus and S&P. The license agreement will be terminated if the Reorganization is approved and consummated.
3 Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Fund until at least August 1, 2011, so that the direct expenses of Class A, Class B, Class C and Class I shares of the Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 1.30%, 2.05%, 2.05% and 1.05%, respectively.
4 Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Acquiring Fund for the period June 1, 2010 through November 30, 2010, so that the direct expenses of Class A, Class B, Class C and Class I shares of the Acquiring Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed 1.50%, 2.25%, 2.25% and 1.25%, respectively.
5 If the Reorganization is approved and consummated, Dreyfus has contractually agreed to waive receipt of its fees and/or assume the expenses of the Acquiring Fund until at least January 31, 2012, so that the net operating expenses of Class A, Class B, Class C and Class I shares of the Acquiring Fund (excluding taxes, interest, brokerage commissions, commitment fees on borrowings and extraordinary expenses) do not exceed the net operating expenses of the corresponding class of shares of the Fund as of the Fund's fiscal year ended March 31, 2010 (i.e., 1.30%, 2.05%, 2.05% and 1.05%, respectively).
Examples
The Examples below are intended to help you compare the cost of investing in the Fund and the Acquiring Fund. The first "Pro Forma After Reorganization" Example below shows the Reorganization of the Fund and the Acquiring Fund and the second "Pro Forma After Reorganizations" Example below shows the reorganizations of the Fund, the Structured Fund and the Acquiring Fund. Each Example assumes you invest $10,000 in the respective fund for the time periods indicated. Each Example also assumes that your investment has a 5% return each year and that the respective fund's operating expenses remain the same. The one-year Example and the first year of the three-, five- and ten-years Examples for the Fund are based on net operating expenses, which reflect any expense waiver/reimbursement arrangements by Dreyfus. The "Pro Forma After Reorganization(s)" Examples are based on the operating expenses of the funds, as of the respective fiscal year ends noted above, as adjusted showing the effect of the reorganizations. The one-year and the first year of the three-, five- and ten-years for the "Pro Forma After Reorganization(s)" Examples below are based on net operating expenses, which reflect any expense waiver/reimbursement arrangements by Dreyfus. Although your actual costs may be higher or lower, based on these assumptions your costs would be:
Fund | ||||
Class A Shares | Class B Shares* | Class C Shares* | Class I Shares | |
1 Year | $700 | $608/$208 | $308/$208 | $107 |
3 Years | $1,007 | $1,015/$715 | $676/$676 | $392 |
5 Years | $1,337 | $1,449/$1,249 | $1,170/$1,170 | $698 |
10 Years | $2,266 | $2,289/$2,289** | $2,532/$2,532 | $1,567 |
Acquiring Fund | ||||
Class A Shares | Class B Shares* | Class C Shares* | Class I Shares | |
1 Year | $702 | $627/$227 | $317/$217 | $164 |
3 Years | $969 | $1,000/$700 | $670/$670 | $508 |
5 Years | $1,257 | $1,400/$1,200 | $1,149/$1,149 | $876 |
10 Years | $2,074 | $2,129/$2,129** | $2,472/$2,472 | $1,911 |
Pro Forma After Reorganization—Fund and Acquiring Fund Acquiring Fund Shares | ||||
Class A Shares | Class B Shares* | Class C Shares* | Class I Shares | |
1 Year | $700 | $608/$208 | $308/$208 | $107 |
3 Years | $963 | $978/$678 | $645/$645 | $364 |
5 Years | $1,247 | $1,374/$1,174 | $1,108/$1,108 | $641 |
10 Years | $2,053 | $2,094/$2,094** | $2,389/$2,389 | $1,431 |
Pro Forma After Reorganizations—Fund, Structured Fund and Acquiring Fund Acquiring Fund Shares | ||||
Class A Shares | Class B Shares* | Class C Shares* | Class I Shares | |
1 Year | $700 | $608/$208 | $308/$208 | $107 |
3 Years | $963 | $976/$676 | $645/$645 | $347 |
5 Years | $1,247 | $1,370/$1,170 | $1,108/$1,108 | $606 |
10 Years | $2,053 | $2,089/$2,089** | $2,389/$2,389 | $1,346 |
___________________________
* | With redemption/without redemption. |
** | Assumes conversion of Class B shares to Class A shares at the end of the sixth year following the date of purchase. |
Past Performance. The bar charts and tables below illustrate the risks of investing in the Acquiring Fund and the Fund. The bar chart for the Acquiring Fund shows the changes in the performance of the Acquiring Fund's Class A shares from year to year and the bar chart for the Fund shows the changes in the performance of the Fund's Class A shares from year to year. The table for each fund compares the average annual total returns of the respective fund's shares to those of broad measures of market performance. Sales charges, if any, are not reflected in the bar chart, and if those charges were included, returns would have been less than those shown. Past performance (before and after taxes) is no guarantee of future results. More recent performance information may be available at www.dreyfus.com.
The Fund commenced investment operations after all of the assets of another investment company (the "predecessor fund") were transferred to the Fund in a tax-free reorganization on May 1, 2004. The Fund's performance figures in the bar chart and table below represent the performance of the predecessor fund's shares for periods prior to May 1, 2004 and the performance of the respective class of Fund shares thereafter.
After-tax performance is shown only for Class A shares of the Acquiring Fund and the Fund. After-tax performance of each fund's other share classes will vary. After-tax returns are calculated using the historical highest individual federal marginal income tax rates, and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor's tax situation and may differ from those shown, and the after-tax returns shown are not relevant to investors who hold their shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts.
Acquiring Fund—Class A Shares
Year-by-year total returns as of 12/31 each year (%)
+8.60 | -9.56 | -11.55 | +31.68 | +15.33 | +14.40 | +13.56 | -4.76 | -44.73 | +35.24 |
'00 | '01 | '02 | '03 | '04 | '05 | '06 | '07 | '08 | '09 |
Best Quarter: | Q2 '09 | +20.71% |
Worst Quarter: | Q4 '08 | -28.18% |
The year-to-date total return of the Acquiring Fund's Class A shares as of 6/30/10 was –3.56%.
Acquiring Fund Shares
Average annual total returns as of 12/31/09
Share Class (inception date) | 1 Year | 5 Years | 10 Years |
Class A (1/29/85) returns before taxes | 27.48% | -2.71% | 1.41% |
Class A returns after taxes on distributions | 27.34% | -3.81% | 0.00% |
Class A returns after taxes on distributions and sale of fund shares | 18.05% | -2.07% | 1.03% |
Class B (11/27/02)* returns before taxes | 30.05% | -2.62% | 1.77%** |
Class C (11/27/02)* returns before taxes | 33.13% | -2.31% | 1.47% |
Class I (11/27/02)* returns before taxes | 35.01% | -1.66% | 2.01% |
Russell Midcap Index reflects no deduction for fees, expenses or taxes | 40.48% | 2.43% | 4.98% |
S&P MidCap 400 Index reflects no deduction for fees, expenses or taxes | 37.38% | 3.27% | 6.36% |
_______________________________
* For the Acquiring Fund's Class B, Class C and Class I shares, periods prior to inception date reflect the performance of the Acquiring Fund's Class A shares, adjusted to reflect applicable sales charges. Such performance figures have not been adjusted, however, to reflect applicable fees and expenses; if such fees and expenses were reflected, the performance shown for Class B and Class C shares of the Acquiring Fund would have been lower.
** Assumes conversion of Class B shares to Class A shares at the end of the sixth year following the date of purchase.
Fund—Class A Shares*
Year-by-year total returns as of 12/31 each year (%)
-22.59 | +34.88 | +17.29 | +20.64 | +12.09 | +11.89 | -37.56 | +21.59 |
'02 | '03 | '04 | '05 | '06 | '07 | '08 | '09 |
Best Quarter: | Q2 '03 | +15.54% |
Worst Quarter: | Q4 '08 | -22.46% |
The year-to-date total return of the Fund's Class A shares as of 6/30/10 was –4.28%.
* Represents the performance of the predecessor fund's shares for periods prior to May 1, 2004.
Fund Shares Average annual total returns as of 12/31/09* |
Share Class (inception date) | 1 Year | 5 Years | Since Inception |
Class A (10/01/01) returns before taxes | 14.58% | 1.60% | 5.52% |
Class A returns after taxes on distributions | 14.58% | 1.46% | 5.34% |
Class A returns after taxes on distributions and sale of fund shares | 9.48% | 1.39% | 4.78% |
Class B (10/01/01) returns before taxes | 16.77% | 1.72% | 5.83%** |
Class C (10/01/01) returns before taxes | 19.66% | 2.11% | 5.62% |
Class I (10/01/01) returns before taxes | 21.94% | 3.08% | 6.64% |
Russell Midcap Index reflects no deduction for fees, expenses or taxes | 40.48% | 2.43% | 7.85% |
S&P MidCap 400 Index reflects no deduction for fees, expenses or taxes | 37.38% | 3.27% | 7.89% |
_______________________________
* Represents the performance of the predecessor fund's shares for periods prior to May 1, 2004, as adjusted to reflect the Fund's applicable sales loads, and the performance of the respective class of Fund shares thereafter.
** Assumes conversion of Class B shares to Class A shares at the end of the sixth year following the date of purchase.
Investment Adviser. The investment adviser for the Fund and the Acquiring Fund is Dreyfus, located at 200 Park Avenue, New York, New York 10166. Founded in 1947, Dreyfus manages approximately $273 billion in approximately 193 mutual fund portfolios. A discussion regarding the basis for the Company's Board approving the Acquiring Fund's management agreement with Dreyfus is available in the Acquiring Fund's Annual Report for the fiscal year ended December 31, 2009. Dreyfus is the primary mutual fund business of The Bank of New York Mellon Corporation ("BNY Mellon"), a global financial services company focused on helping clients move and manage their financial assets, operating in 34 countries and serving more than 100 markets. BNY Mellon is a leading provider of financial services for institutions, corporations and high-net-worth individuals, providing asset and wealth management, asset servicing, issuer services, and treasury services through a worldwide client-focused team. BNY Mellon has more than $22.3 trillion in assets under custody and administration and $1.1 trillion in assets under management, and it services more than $12 trillion in outstanding debt. Additional information is available at www.bnymellon.com.
Primary Portfolio Managers. Warren Chiang, CFA, and C. Wesley Boggs serve as the primary portfolio managers of the Fund and the Acquiring Fund, and will manage the combined fund if the Reorganization is approved and consummated. Messrs. Chiang and Boggs have served as the primary portfolio managers of the Acquiring Fund since February 2009 and of the Fund since March 2010. Mr. Chiang is managing director and head of active equity strategies at Mellon Capital Management Corporation ("Mellon Capital"), an affiliate of Dreyfus, where he has been employed since 1997. Mr. Boggs is a vice president and senior portfolio manager at Mellon Capital, where he has been employed since 1993. Messrs. Chiang and Boggs have been employed by Dreyfus since September 2007.
Board Members. Other than Joseph S. DiMartino, who is Chairman of the Board of the Trust and the Company, and Ehud Houminer, who is a member of the Boards of the Trust and the Company, the Trust and the Company have different Board members. None of the Board members of the Trust or the Company is an "interested person" (as defined in the 1940 Act) of the Fund or the Acquiring Fund ("Independent Board Members"). For a description of the Company's Board members, see Exhibit B.
Independent Registered Public Accounting Firm. Ernst & Young LLP is the independent registered public accounting firm for the Fund and the Acquiring Fund.
Capitalization. The Fund and the Acquiring Fund have classified their respective shares into four classes – Class A, Class B, Class C and Class I. The following tables set forth, as of December 31, 2009, (1) the capitalization of each class of the Fund's shares, (2) the capitalization of each class of the Acquiring Fund's shares and (3) the pro forma capitalization of each class of the Acquiring Fund's shares, as adjusted showing the effect of the Reorganization had it occurred on such date.
Fund Class A | Acquiring Fund Class A | Adjustments | Pro Forma After Reorganization Acquiring Fund Class A | ||||
Total net assets | $124,677,505 | $445,290,042 | $569,967,547 | ||||
Net asset value per share | $18.47 | $28.02 | $28.02 | ||||
Shares outstanding | 6,749,519 | 15,889,262 | 4,449,094* | 20,338,356 |
Fund Class B | Acquiring Fund Class B | Adjustments | Pro Forma After Reorganization Acquiring Fund Class B | ||||
Total net assets | $6,613,826 | $4,928,774 | $11,542,600 | ||||
Net asset value per share | $17.50 | $26.85 | $26.85 | ||||
Shares outstanding | 377,933 | 183,579 | 246,325* | 429,904 |
Fund Class C | Acquiring Fund Class C | Adjustments | Pro Forma After Reorganization Acquiring Fund Class C | ||||
Total net assets | $28,328,010 | $8,407,308 | $36,735,318 | ||||
Net asset value per share | $17.52 | $26.91 | $26.91 | ||||
Shares outstanding | 1,617,195 | 312,423 | 1,052,889* | 1,365,312 |
Fund Class I | Acquiring Fund Class I | Adjustments | Pro Forma After Reorganization Acquiring Fund Class I | ||||
Total net assets | $45,862,148 | $4,112,066 | $49,974,214 | ||||
Net asset value per share | $19.01 | $28.36 | $28.36 | ||||
Shares outstanding | 2,412,898 | 145,003 | 1,617,390* | 1,762,393 |
_______________________
* Adjustment to reflect the exchange of shares outstanding from the Fund to the Acquiring Fund.
The Fund's total net assets (attributable to Class A, Class B, Class C and Class I shares) and the Acquiring Fund's total net assets (attributable to Class A, Class B, Class C and Class I shares), as of December 31, 2009, were $205,481,489 and $462,738,190, respectively. Each share has one vote. Shares have no preemptive or subscription rights and are freely transferable. All share classes of a fund invest in the same portfolio of securities, but the classes are subject to different charges and expenses and will likely have different share prices.
Shareholders of the Structured Fund also are being asked in proxy materials directed to them to approve a separate Agreement and Plan of Reorganization providing for the transfer of all of such fund's assets, subject to liabilities, to the Acquiring Fund in exchange for Acquiring Fund shares. As of December 31 ,2009, the Structured Fund had total net assets (attributable to Class A, Class B, Class C and Class I shares) of $111,449,717. If approved by the Fund's shareholders, the Reorganization will be consummated for the Fund whether or not the shareholders of the Structured Fund approve the reorganization of that fund with the Acquiring Fund.
Purchase Procedures. The purchase procedures of the Fund and the Acquiring Fund and the automatic investment services they offer are the same. See the relevant fund's Prospectus and Statement of Additional Information for a discussion of purchase procedures.
Distribution (12b-1) Plans. Class B and Class C shares of the Fund and the Acquiring Fund are subject to plans adopted pursuant to Rule 12b-1 under the 1940 Act (each, a "Rule 12b-1 Plan"). Under the respective Rule 12b-1 Plan, the Fund and the Acquiring Fund pay MBSC Securities Corporation ("MBSC"), their distributor, a fee at an annual rate of 0.75% of the value of the average daily net assets of their respective Class B and Class C shares to finance the sale and distribution of such shares. There is no Rule 12b-1 Plan fee for Class A or Class I shares of either fund. Because Rule 12b-1 Plan fees are paid out of the assets attributable to the relevant class of shares on an ongoing basis, over time they will increase the cost of your investment in such class of shares and may cost you more than paying other types of sales charges. See "Distribution Plan and Shareholder Services Plan—Distribution Plan" in each fund's Statement of Additional Information for a discussion of the respective Rule 12b-1 Plan.
Shareholder Services Plan. Class A, Class B and Class C shares of the Fund and the Acquiring Fund are subject to a Shareholder Services Plan pursuant to which the Fund and the Acquiring Fund pay MBSC a fee at an annual rate of 0.25% of the value of the average daily net assets of their respective Class A, Class B and Class C shares for providing shareholder services and/or maintaining shareholder accounts. There is no Shareholder Services Plan fee for Class I shares of either fund. See "Distribution Plan and Shareholder Services Plan — Shareholder Services Plan" in each fund's Statement of Additional Information for a discussion of the respective Shareholder Services Plan.
Redemption Procedures. The redemption procedures of the Fund and the Acquiring Fund are the same. See the relevant fund's Prospectus and Statement of Additional Information for a discussion of redemption procedures.
Distributions. The dividends and distributions policies of the Fund and the Acquiring Fund are identical. Each fund anticipates paying its shareholders any dividends and capital gain distributions annually, but each fund may make distributions on a more frequent basis to comply with the distribution requirements of the Internal Revenue Code of 1986, as amended (the "Code"), in all events in a manner consistent with the provisions of the 1940 Act. The actual amount of dividends paid per share by the Fund and the Acquiring Fund is different. See "Distributions and Taxes" in the relevant Prospectus for a discussion of such policies.
Shareholder Services. The shareholder services offered by the Fund and the Acquiring Fund are the same. The privileges you currently have on your Fund account will transfer automatically to your account with the Acquiring Fund. See "Services for Fund Investors" in the relevant Prospectus and "Shareholder Services" in the relevant Statement of Additional Information for a further discussion of the shareholder services offered.
Certain Organizational Differences Between the Trust and the Company. The Fund is a series of the Trust, which is a Massachusetts business trust, and the rights of its shareholders are governed by the Trust's Agreement and Declaration of Trust (the "Trust Agreement"), the Trust's By-Laws and applicable Massachusetts law. The Acquiring Fund is a series of the Company, which is a Maryland corporation, and the rights of its shareholders are governed by the Company's Articles of Incorporation (the "Charter"), the Company's By-Laws and the Maryland General Corporation Law (the "Maryland Code"). Certain relevant differences between the two forms of organization are summarized below.
Shareholder Meetings and Voting Rights. Generally, neither the Fund nor the Acquiring Fund is required to hold annual meetings of its shareholders. The relevant Board is required to call a special meeting of shareholders for the purpose of removing a Board member when requested in writing to do so by the holders of at least 10% of its outstanding shares entitled to vote. Shareholders may remove a Board member by the affirmative vote of two-thirds, in the case of the Fund, or a majority, in the case of the Acquiring Fund, of the respective fund's outstanding voting shares. Moreover, the Board will call a meeting of shareholders for the purpose of electing Board members if at any time less than a majority of the Board members then holding office have been elected by the shareholders.
Shares of the Fund and the Acquiring Fund are entitled to one vote for each full share held and a proportionate fractional vote for each fractional share held. Generally, on matters submitted to a vote of shareholders, all shares of the Fund or the Acquiring Fund then entitled to vote will be voted in the aggregate as a single class. The Trust Agreement provides that 30% of the Fund's shares entitled to vote shall constitute a quorum for the transaction of business at a Fund shareholders' meeting. The Company's Charter provides that one-third of the Acquiring Fund's shares entitled to vote shall constitute a quorum for the transaction of business at an Acquiring Fund shareholders' meeting. Matters requiring a larger vote by law or under the organizational documents for the Trust or the Company are not affected by such quorum requirements.
Shareholder Liability. Under the Maryland Code, Acquiring Fund shareholders have no personal liability as such for the Acquiring Fund's acts or obligations.
Under Massachusetts law, shareholders of a Massachusetts business trust, under certain circumstances, could be held personally liable for the obligations of the business trust. However, the Trust's Trust Agreement disclaims shareholder liability for acts or obligations of the Fund and requires that notice of such disclaimer be given in each agreement, obligation, instrument or other undertaking issued or entered into or executed by, or on behalf of, the Fund, or the Trust's Trustees. The Trust Agreement provides for indemnification out of the Fund's property of all losses and expenses of any shareholder held personally liable for the obligations of the Fund solely by reason of being or having been a Fund shareholder and not because of such shareholder's acts or omissions or some other reason. Thus, the Fund considers the risk of a Fund shareholder incurring financial loss on account of shareholder liability to be remote because it is limited to circumstances in which a disclaimer is inoperative or the Fund itself would be unable to meet its obligations. The Trust Agreement also provides that the Trust, upon request, will assume the defense of any claim made against any shareholder for any act or obligation of the Fund and satisfy any judgment thereon.
Liability and Indemnification of Board Members. Under the Maryland Code, the Company's Charter and By-Laws, and subject to the 1940 Act, a Director or officer of the Company is not liable to the Acquiring Fund or its shareholders for monetary damages except to the extent he or she receives an improper personal benefit or his or her action or failure to act was the result of active and deliberate dishonesty and was material to the cause of action adjudicated. In addition, a Director is entitled to indemnification against judgments, penalties, fines, settlements and reasonable expenses unless his or her act or omission was material to the cause of action and was committed in bad faith or was the result of active and deliberate dishonesty or the individual received an improper personal benefit (or, in a criminal case, had reasonable cause to believe that his or her act or omission was unlawful). Indemnification may be made against amounts recovered by settlement of suits brought by or in the right of the Acquiring Fund except where the individual is adjudged liable to the Acquiring Fund. The termination of a civil proceeding by judgment, order or settlement does not create a presumption that the requisite standard of conduct was not met. A Director or officer is entitled to advances of expenses in the course of litigation if (i) such Director or officer undertakes to repay such sums if indemnification ultimately is denied and provides acceptable security, (ii) the Company is insured against losses arising from the advances, or (iii) the disinterested non-party Directors or independent legal counsel determine there is a reason to believe the Director or officer ultimately will be found to be entitled to indemnification. Officers, employees and agents also are indemnified to the same extent as Directors and to such further extent as is consistent with law.
If these provisions of the Maryland Code are amended, the Directors and officers will be entitled to limited liability and to indemnification to the fullest extent of Maryland law as amended. No amendment or repeal of the provisions of the Company's Charter relating to limited liability and indemnification will apply to any event, omission or proceeding that precedes the amendment or repeal.
Under Massachusetts law, the Trust's Trust Agreement and By-Laws, and subject to the 1940 Act, a Trustee is entitled to indemnification against all liability and expenses reasonably incurred by such Trustee in connection with the defense or disposition of any threatened or actual proceeding by reason of his or her being or having been a Trustee, unless such Trustee is adjudicated to have acted with bad faith, willful misfeasance, gross negligence or in reckless disregard of his or her duties. A Trustee is entitled to advances of expenses in the course of litigation if (i) such Trustee undertakes to repay such sums if indemnification ultimately is denied and (ii) any of the following has occurred: (x) the Trustee provides acceptable security, (y) the Trust is insured against losses arising from the advances, or (z) the disinterested non-party Trustees or independent legal counsel determine there is a reason to believe the Trustee ultimately will be found to be entitled to indemnification. Officers, employees and agents of the Trust may be indemnified to the same extent as Trustees.
Under the 1940 Act, a director or trustee may not be protected against liability to a fund and its security holders to which he or she would otherwise be subject as a result of his or her willful misfeasance, bad faith or gross negligence in the performance of his or her duties, or by reason of reckless disregard of his or her obligations and duties.
* * * * * * * * *
The foregoing is only a summary of certain differences between the Acquiring Fund, the Company's Charter, the Company's By-Laws and the Maryland Code, and the Fund, the Trust's Trust Agreement, the Trust's By-Laws and Massachusetts law. It is not a complete description of the differences, but only of material differences. Shareholders desiring copies of the Company's Charter and By-Laws or the Trust's Trust Agreement and By-Laws should write to the relevant fund at 200 Park Avenue, New York, New York 10166, Attention: Legal Department.
REASONS FOR THE REORGANIZATION
After management of Dreyfus reviewed the funds in the Dreyfus Family of Funds to determine whether it would be appropriate to consolidate certain funds having similar investment objectives and investment management policies and that would otherwise benefit fund shareholders, management recommended to the Trust's Board and to the Company's Board that the Fund be consolidated with the Acquiring Fund. The Trust's Board and the Company's Board have concluded, with respect to the Fund and the Acquiring Fund, respectively, that the Reorganization is in the best interests of the Fund and its shareholders and the Acquiring Fund and its shareholders, respectively. In reaching this conclusion, the Trust's Board of Trustees determined that reorganizing the Fund into the Acquiring Fund, which also is managed by Dreyfus and has a substantially similar investment objective and similar investment management policies as those of the Fund, offers potential benefits to Fund shareholders. The Trust's Board believes that the Reorganization will permit Fund shareholders to pursue substantially similar investment goals in a larger combined fund, without diluting such shareholders' interests. In addition, the Acquiring Fund had a better recent short-term performance record than the Fund. As of December 31, 2009, the Fund had net assets of approximately $205 million and the Acquiring Fund had net assets of approximately $463 million. By combining the Fund with the Acquiring Fund, Fund shareholders should benefit from more efficient portfolio management and Dreyfus should be able to eliminate the duplication of resources and costs associated with marketing and servicing the funds as separate entities.
The Company's Board considered that the Reorganization presents an opportunity for the Acquiring Fund to acquire substantial investment assets without the obligation to pay commissions or other transaction costs that a fund normally incurs when purchasing securities. This opportunity provides an economic benefit to the Acquiring Fund.
In determining whether to recommend approval of the Reorganization, each Board considered the following factors, among others: (1) the compatibility of the Fund's and the Acquiring Fund's investment objectives, management policies and restrictions, as well as shareholder services offered by the Fund and the Acquiring Fund; (2) the terms and conditions of the Reorganization and whether the Reorganization would result in dilution of shareholder interests; (3) information regarding the fees and expenses, including the net expense ratios, of the Fund and the Acquiring Fund, as well as the estimated expense ratio of the combined fund; (4) the relative performance of the Fund and the Acquiring Fund; (5) the tax consequences of the Reorganization; and (6) that the costs to be incurred by the Fund and the Acquiring Fund in connection with the Reorganization would be borne by Dreyfus and not the Fund or the Acquiring Fund.
For the reasons described above, the Trust's Board and the Company's Board, each of which is comprised entirely of Independent Board Members, approved the Reorganization.
INFORMATION ABOUT THE REORGANIZATION
Plan of Reorganization. The following summary of the Plan is qualified in its entirety by reference to the Plan attached to this Prospectus/Proxy Statement as Exhibit A. The Plan provides that, subject to the requisite approval of the Fund's shareholders, the Acquiring Fund will acquire all of the assets of the Fund in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund and the assumption by the Acquiring Fund of the Fund's stated liabilities on January 27, 2011 or such other date as may be agreed upon by the parties (the "Closing Date"). The number of Class A, Class B, Class C and Class I shares of the Acquiring Fund to be issued to the Fund will be determined on the basis of the relative net asset values per share and aggregate net assets of the corresponding class of shares of the Fund and the Acquiring Fund, generally computed as of the close of trading on the floor of the New York Stock Exchange (usually at 4:00 p.m., Eastern time) on the Closing Date. Portfolio securities of the Fund and the Acquiring Fund will be valued in accordance with the valuation practices of the Acquiring Fund, which are the same as those of the Fund and are described under the caption "Shareholder Guide—Buying and Selling Shares" in the Acquiring Fund's Prospectus and under the caption "Determination of Net Asset Value" in the Acquiring Fund's Statement of Additional Information.
On or before the Closing Date, the Fund will declare a dividend or dividends which, together with all previous dividends, will have the effect of distributing to Fund shareholders all of the Fund's previously undistributed investment company taxable income, if any, for the tax periods ending on or before the Closing Date (computed without regard to any deduction for dividends paid), its net exempt interest income for the tax periods ending on or before the Closing Date, and all of its previously undistributed net capital gain, if any, realized in the tax periods ending on or before the Closing Date (after reduction for any capital loss carryforward). Any such distribution will be taxable to Fund shareholders.
As soon as conveniently practicable after the Closing Date, the Fund will liquidate and distribute pro rata to its Class A, Class B, Class C and Class I shareholders of record, as of the close of business on the Closing Date, the Acquiring Fund Class A, Class B, Class C and Class I shares received by it in the Reorganization. Such liquidation and distribution will be accomplished by establishing accounts on the share records of the Acquiring Fund in the name of each Fund shareholder, each account being credited with the respective pro rata number of Acquiring Fund shares due to the shareholder. The Acquiring Fund shares received by each Fund shareholder will be of the same share class as the shareholder's Fund shares. After such distribution and the winding up of its affairs, the Fund will cease operations and will be terminated as a series of the Trust. After the Closing Date, any outstanding certificates representing Fund shares will be canceled and the Acquiring Fund shares distributed to the Fund's shareholders of record will be reflected on the books of the Acquiring Fund as uncertificated, book-entry shares.
The Plan may be amended at any time prior to the Reorganization. The Fund will provide its shareholders with information describing any material amendment to the Plan prior to shareholder consideration. The obligations of the Trust, on behalf of the Fund, and the Company, on behalf of the Acquiring Fund, under the Plan are subject to various conditions, including approval by Fund shareholders holding the requisite number of Fund shares and the continuing accuracy of various representations and warranties of the Trust, on behalf of the Fund, and the Company, on behalf of the Acquiring Fund.
The total expenses of the Reorganization are expected to be approximately $135,000, which will be borne by Dreyfus. In addition to use of the mails, proxies may be solicited personally or by telephone, and Dreyfus may pay persons holding Fund shares in their names or those of their nominees for their expenses in sending soliciting materials to their principals. In addition, an outside firm may be retained to solicit proxies on behalf of the Trust's Board. The cost of any such outside solicitation firm, which would be borne by Dreyfus, is estimated to be approximately $20,000, which amount is included in the estimated total expenses of the Reorganization listed above. The funds, however, will bear their respective portfolio transaction costs whether or not associated with the Reorganization.
By approving the Reorganization, Fund shareholders also are, in effect, agreeing to the Acquiring Fund's investment objective and policies, investment advisory and distribution arrangements, Board composition, and independent registered public accounting firm. If the Reorganization is not approved by Fund shareholders, the Trust's Board will consider other appropriate courses of action with respect to the Fund.
Temporary Suspension of Certain of the Fund's Investment Restrictions. Since certain of the Fund's existing investment restrictions could preclude the Fund from consummating the Reorganization in the manner contemplated in the Plan, Fund shareholders are requested to authorize the temporary suspension of any investment restriction of the Fund to the extent necessary to permit the consummation of the Reorganization. The temporary suspension of any of the Fund's investment restrictions will not affect the investment restrictions of the Acquiring Fund. A vote in favor of the proposal is deemed to be a vote in favor of the temporary suspension.
Federal Income Tax Consequences. The exchange of Fund assets for Acquiring Fund Class A, Class B, Class C and Class I shares, the Acquiring Fund's assumption of the Fund's stated liabilities, and the Fund's distribution of those shares to Fund shareholders are intended to qualify for federal income tax purposes as a tax-free reorganization under Section 368(a) of the Code. As a condition to the closing of the Reorganization, the Fund and the Acquiring Fund will receive the opinion of Stroock & Stroock & Lavan LLP, counsel to the Fund, the Acquiring Fund and the Independent Board Members, to the effect that, on the basis of the existing provisions of the Code, Treasury regulations issued thereunder, current administrative regulations and pronouncements and court decisions, and certain facts, assumptions and representations, for federal income tax purposes: (1) the transfer of all of the Fund's assets to the Acquiring Fund in exchange solely for Acquiring Fund Class A, Class B, Class C and Class I shares and the assumption by the Acquiring Fund of the Fund's stated liabilities, followed by the distribution by the Fund of those Acquiring Fund Class A, Class B, Class C and Class I shares pro rata to Fund shareholders in complete liquidation of the Fund, will qualify as a "reorganization" within the meaning of Section 368(a) of the Code, and each of the Fund and the Acquiring Fund will be "a party to a reorganization"; (2) no gain or loss will be recognized by the Acquiring Fund upon the receipt of the assets of the Fund in exchange solely for Acquiring Fund Class A, Class B, Class C and Class I shares and the assumption by the Acquiring Fund of stated liabilities of the Fund pursuant to the Reorganization; (3) no gain or loss will be recognized by the Fund upon the transfer of its assets to the Acquiring Fund in exchange solely for Acquiring Fund Class A, Class B, Class C and Class I shares and the assumption by the Acquiring Fund of stated liabilities of the Fund or upon the distribution (whether actual or constructive) of those Acquiring Fund Class A, Class B, Class C and Class I shares to Fund shareholders in exchange for their shares of the Fund in liquidation of the Fund pursuant to the Reorganization; (4) no gain or loss will be recognized by Fund shareholders upon the exchange of their Fund Class A, Class B, Class C and Class I shares for Acquiring Fund Class A, Class B, Class C and Class I shares pursuant to the Reorganization; (5) the aggregate tax basis for the Acquiring Fund Class A, Class B, Class C and Class I shares received by each Fund shareholder pursuant to the Reorganization will be the same as the aggregate tax basis for the Fund shares held by such shareholder immediately prior to the Reorganization, and the holding period of those Acquiring Fund Class A, Class B, Class C and Class I shares received by each Fund shareholder will include the period during which the Fund shares exchanged therefor were held by such shareholder (provided the Fund shares were held as capital assets on the date of the Reorganization); and (6) the tax basis of each Fund asset acquired by the Acquiring Fund will be the same as the tax basis of such asset to the Fund immediately prior to the Reorganization, and the holding period of each Fund asset in the hands of the Acquiring Fund will include the period during which that asset was held by the Fund.
The Fund and the Acquiring Fund have not sought a tax ruling from the Internal Revenue Service ("IRS"). The opinion of counsel is not binding on the IRS, nor does it preclude the IRS from adopting a contrary position. Fund shareholders should consult their tax advisers regarding the effect, if any, of the Reorganization in light of their individual circumstances. Because the foregoing discussion relates only to the federal income tax consequences of the Reorganization, Fund shareholders also should consult their tax advisers as to state and local tax consequences, if any, of the Reorganization.
Capital Loss Carryforward. As of the Fund's fiscal year ended March 31, 2010, the Fund had an unused capital loss carryforward of approximately $73.1 million. There are limitations to the amount of the carryforward that can be utilized in any one year, and any amount that cannot be utilized in any one year can be carried over to a succeeding year subject to the same limitations in such year. Different amounts of the capital loss carryforward expire in different years. The Reorganization would impose further limitations on the amount of the carryforward that could be utilized and carried over to succeeding years. Consequently, as a result of the limitations on the use of the capital loss carryforward, if the Reorganization is consummated it is expected that some of the Fund's capital loss carryforward will expire unused.
Sale of Portfolio Securities. Certain of the portfolio securities currently held by the Fund are expected to be sold after the consummation of the Reorganization, subject to any restrictions imposed by the Code. The tax impact of the sale of such portfolio securities will depend on the difference between the price at which such securities are sold and the combined fund's tax basis in such securities. Any capital gains recognized as a result of these sales on a net basis, after the application of any available capital loss carryforward, will be distributed to the combined fund's shareholders and such distributions will be taxable to such shareholders. As of the date hereof, the combined fund is not expected to recognize material capital gains as a result of the sale of certain of the Fund's portfolio securities acquired in connection with the Reorganization. The transaction costs associated with the sale of such Fund securities will be borne by the combined fund. The Fund and the Acquiring Fund also may buy and sell securities in the normal course of their operations, the transaction costs for which would be borne by the respective fund.
Required Vote and Board's Recommendation
The Trust's Board has approved the Plan and the Reorganization and has determined that (1) participation in the Reorganization is in the best interests of the Fund and its shareholders and (2) the interests of shareholders of the Fund will not be diluted as a result of the Reorganization. The affirmative vote of a majority of the Fund's shares outstanding and entitled to vote is required to approve the Plan and the Reorganization.
THE TRUST'S BOARD, ALL OF WHOSE MEMBERS ARE INDEPENDENT BOARD
MEMBERS, UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
"FOR" APPROVAL OF THE PLAN AND THE REORGANIZATION.
ADDITIONAL INFORMATION ABOUT THE ACQUIRING FUND AND THE FUND
Information about the Acquiring Fund is incorporated by reference into this Prospectus/Proxy Statement from the Acquiring Fund's Prospectus, forming a part of the Company's Registration Statement on Form N-1A (File No. 2-88816). Information about the Fund is incorporated by reference into this Prospectus/Proxy Statement from the Fund's Prospectus, forming a part of the Trust's Registration Statement on Form N-1A (File No. 333-106576).
The Fund and the Acquiring Fund are subject to the requirements of the 1940 Act and file reports, proxy statements and other information with the Commission. Reports, proxy statements and other information filed by the Fund and the Acquiring Fund may be inspected and copied at the Public Reference Facilities of the Commission at 100 F Street, N.E., Washington, D.C. 20549. Text-only versions of fund documents can be viewed on-line or downloaded from www.sec.gov or www.dreyfus.com. Copies of such material also can be obtained from the Public Reference Branch, Office of Consumer Affairs and Information Services, Securities and Exchange Commission, Washington, D.C. 20549, at prescribed rates.
VOTING INFORMATION
In addition to the use of the mails, proxies may be solicited personally or by telephone, and persons holding Fund shares in their names or in nominee name may be paid for their expenses in sending soliciting materials to their principals. An outside firm may be retained to assist in the solicitation of proxies, primarily by contacting shareholders by telephone.
Authorizations to execute proxies may be obtained by telephonic or electronically transmitted instructions in accordance with procedures designed to authenticate the shareholder's identity. In all cases where a telephonic proxy is solicited (as opposed to where the shareholder calls the toll-free number directly to vote), the shareholder will be asked to provide or confirm certain identifiable information and to confirm that the shareholder has received the Prospectus/Proxy Statement and proxy card in the mail. Within 72 hours of receiving a shareholder's telephonic or electronically transmitted voting instructions, a confirmation will be sent to the shareholder to ensure that the vote has been taken in accordance with the shareholder's instructions and to provide a telephone number to call immediately if the shareholder's instructions are not correctly reflected in the confirmation. Any shareholder giving a proxy may revoke it at any time before it is exercised by submitting a new proxy to the Fund or by attending the Meeting and voting in person.
If a proxy is executed properly and returned accompanied by instructions to withhold authority to vote, represents a broker "non-vote" (that is, a proxy from a broker or nominee indicating that such person has not received instructions from the beneficial owner or other person entitled to vote Fund shares on a particular matter with respect to which the broker or nominee does not have discretionary power) or is marked with an abstention (collectively, "abstentions"), the Fund shares represented thereby will be considered to be present at the Meeting for purposes of determining the existence of a quorum for the transaction of business. Abstentions will have the effect of a "no" vote for the purpose of obtaining requisite approval for the proposal.
With respect to Dreyfus-sponsored individual retirement accounts ("IRAs"), the Individual Retirement Custodial Account Agreement governing the IRAs requires The Bank of New York Mellon ("BNYM"), as the custodian of the IRAs, to vote Fund shares held in such IRAs in accordance with the IRA shareholder's instructions. However, if no voting instructions are received, BNYM may vote Fund shares held in the IRA in the same proportions as the Fund shares for which voting instructions are received from other Dreyfus IRA shareholders. Therefore, if an IRA shareholder does not provide voting instructions prior to the Meeting, BNYM will vote the IRA shares "FOR", "AGAINST" or "ABSTAIN" in the same proportions as it votes the shares for which properly conveyed instructions are timely received from other Dreyfus IRA shareholders.
In the event that a quorum is not present at the Meeting, or if a quorum is present but sufficient votes to approve the proposal are not received, the persons named as proxies may propose one or more adjournments of the Meeting to permit further solicitation of proxies for the Fund. In determining whether to adjourn the Meeting, the following factors may be considered: the nature of the proposal, the percentage of votes actually cast, the percentage of negative votes actually cast, the nature of any further solicitation and the information to be provided to Fund shareholders with respect to the reasons for the solicitation. Any adjournment will require the affirmative vote of a majority of those shares affected by the adjournment that are represented at the Meeting in person or by proxy. If a quorum is present, the persons named as proxies will vote those proxies which they are entitled to vote "FOR" the proposal in favor of such adjournment, and will vote those proxies required to be voted "AGAINST" the proposal against any adjournment. A quorum is constituted for the Fund by the presence in person or by proxy of the holders of 30% of the Fund's outstanding shares entitled to vote at the Meeting.
The votes of the Acquiring Fund's shareholders are not being solicited since their approval or consent is not necessary for the Reorganization.
As of July 30, 2010, the following shareholders were known by the Fund to own of record or beneficially 5% or more of the indicated class of the Fund's outstanding voting shares:
Percentage of Outstanding Shares | ||
Name and Address | Before Reorganization | After Reorganization |
Class A Shares | % | % |
Class B Shares | % | % |
Class C Shares | % | % |
Class I Shares | % | % |
As of July 30, 2010, the following shareholders were known by the Acquiring Fund to own of record or beneficially 5% or more of the indicated class of the Acquiring Fund's outstanding voting shares:
Percentage of Outstanding Shares | ||
Name and Address | Before Reorganization | After Reorganization |
Class A Shares | % | % |
Class B Shares | % | % |
Class C Shares | % | % |
Class I Shares | % | % |
A shareholder who beneficially owns, directly or indirectly, more than 25% of a fund's voting securities may be deemed a "control person" (as defined in the 1940 Act) of the fund.
As of July 30, 2010, Board members and officers of the Trust and the Company, as a group, owned less than 1% of the Fund's or the Acquiring Fund's outstanding shares, respectively.
FINANCIAL STATEMENTS AND EXPERTS
The audited financial statements of the Fund for its fiscal year ended March 31, 2010 and the audited financial statements of the Acquiring Fund for its fiscal year ended December 31, 2009 have been incorporated herein by reference in reliance upon the reports of Ernst & Young LLP, independent registered public accounting firm for the Fund and the Acquiring Fund, given on their authority as experts in accounting and auditing.
OTHER MATTERS
The Trust's Board members are not aware of any other matters that may come before the Meeting. However, should any such matters properly come before the Meeting, it is the intention of the persons named in the accompanying form of proxy to vote the proxy in accordance with their judgment on such matters.
NOTICE TO BANKS, BROKER/DEALERS AND VOTING TRUSTEES
AND THEIR NOMINEES
Please advise the Fund, in care of Dreyfus Transfer, Inc., P.O. Box 55263, Boston, Massachusetts 02205-5263, whether other persons are the beneficial owners of Fund shares for which proxies are being solicited from you, and, if so, the number of copies of the Prospectus/Proxy Statement and other soliciting material you wish to receive in order to supply copies to the beneficial owners of Fund shares.
IT IS IMPORTANT THAT PROXIES BE RETURNED PROMPTLY.
THEREFORE, SHAREHOLDERS WHO DO NOT EXPECT TO ATTEND THE
MEETING IN PERSON ARE URGED TO COMPLETE, DATE, SIGN AND
RETURN THE PROXY CARD IN THE ENCLOSED POSTAGE-PAID ENVELOPE.
EXHIBIT A
AGREEMENT AND PLAN OF REORGANIZATION
AGREEMENT AND PLAN OF REORGANIZATION dated as of July 19, 2010 (the "Agreement"), between DREYFUS MANAGER FUNDS I (the "Trust"), a Massachusetts business trust, on behalf of DREYFUS S&P STARS OPPORTUNITIES FUND (the "Fund"), and STRATEGIC FUNDS, INC. (the "Company"), a Maryland corporation, on behalf of DREYFUS ACTIVE MIDCAP FUND (the "Acquiring Fund").
This Agreement is intended to be and is adopted as a "plan of reorganization" within the meaning of the regulations under Section 368(a) of the United States Internal Revenue Code of 1986, as amended (the "Code"). The reorganization will consist of the transfer of all of the assets of the Fund to the Acquiring Fund in exchange solely for the Acquiring Fund's Class A, Class B, Class C and Class I shares ("Acquiring Fund Shares") of common stock, par value $.001 per share, and the assumption by the Acquiring Fund of the liabilities of the Fund as described herein, and the distribution, after the Closing Date hereinafter referred to, of the Acquiring Fund Shares to the shareholders of the Fund in liquidation of the Fund as provided herein, all upon the terms and conditions hereinafter set forth in this Agreement (the "Reorganization").
WHEREAS, the Fund is a series of the Trust, a registered, open-end management investment company, and the Acquiring Fund is a series of the Company, a registered, open-end management investment company, and the Fund owns securities which are assets of the character in which the Acquiring Fund is permitted to invest;
WHEREAS, both the Fund and the Acquiring Fund are authorized to issue their shares of beneficial interest and common stock, respectively;
WHEREAS, the Trust's Board has determined that the Reorganization is in the best interests of the Fund and the Fund's shareholders and that the interests of the Fund's existing shareholders will not be diluted as a result of the Reorganization; and
WHEREAS, the Company's Board has determined that the Reorganization is in the best interests of the Acquiring Fund and the Acquiring Fund's shareholders and that the interests of the Acquiring Fund's existing shareholders will not be diluted as a result of the Reorganization:
NOW THEREFORE, in consideration of the premises and of the covenants and agreements hereinafter set forth, the parties agree as follows:
1. | THE REORGANIZATION. |
1.1 Subject to the terms and conditions contained herein and on the basis of the representations and warranties contained herein, the Fund agrees to assign, transfer and convey to the Acquiring Fund all of the assets of the Fund, as set forth in paragraph 1.2, free and clear of all liens, encumbrances and claims whatsoever. The Acquiring Fund agrees in exchange therefor (a) to deliver to the Fund the number of Acquiring Fund Shares, including fractional Acquiring Fund Shares, determined as set forth in paragraph 2.3; and (b) to assume the stated liabilities of the Fund, as set forth in paragraph 1.3. Such transactions shall take place at the closing (the "Closing") as of the close of business on the closing date (the "Closing Date"), provided for in paragraph 3.1. In lieu of delivering certificates for the Acquiring Fund Shares, the Acquiring Fund shall credit the Acquiring Fund Shares to the Fund's account on the books of the Acquiring Fund and shall deliver a confirmation thereof to the Fund.
1.2 The assets of the Fund to be acquired by the Acquiring Fund shall consist of all assets, including, without limitation, all portfolio securities, cash, cash equivalents, commodities, interests in futures and other financial instruments, claims (whether absolute or contingent, known or unknown), receivables (including dividends or interest and other receivables) and other property belonging to the Fund, and any deferred or prepaid expenses, reflected on an unaudited statement of assets and liabilities of the Fund approved by The Dreyfus Corporation ("Dreyfus"), as of the Valuation Date (as defined in paragraph 2.1), in accordance with U.S. generally accepted accounting principles ("GAAP") consistently applied from the Fund's prior audited period (the "Assets").
1.3 The Fund will endeavor to identify and, to the extent practicable, discharge all of its known liabilities and obligations before the Closing Date. The Acquiring Fund shall assume the liabilities, expenses, costs, charges and reserves reflected on an unaudited statement of assets and liabilities of the Fund approved by Dreyfus, as of the Valuation Date, in accordance with GAAP consistently applied from the Fund's prior audited period. The Acquiring Fund shall assume only those liabilities of the Fund reflected in that unaudited statement of assets and liabilities and shall not assume any other liabilities, whether absolute or contingent.
1.4 Delivery of the Fund's Assets shall be made on the Closing Date and shall be delivered to The Bank of New York Mellon, One Wall Street, New York, New York 10286, the Acquiring Fund's custodian (the "Custodian"), for the account of the Acquiring Fund, with all securities not in bearer or book-entry form duly endorsed, or accompanied by duly executed separate assignments or stock powers, in proper form for transfer, with signatures guaranteed, and with all necessary stock transfer stamps, sufficient to transfer good and marketable title thereto (including all accrued interest and dividends and rights pertaining thereto) to the Custodian for the account of the Acquiring Fund free and clear of all liens, encumbrances, rights, restrictions and claims. All cash delivered shall be in the form of immediately available funds payable to the order of the Custodian for the account of the Acquiring Fund.
1.5 The Fund will pay or cause to be paid to the Acquiring Fund any dividends and interest received on or after the Closing Date with respect to Assets transferred to the Acquiring Fund hereunder. The Fund will transfer to the Acquiring Fund any distributions, rights or other assets received by the Fund after the Closing Date as distributions on or with respect to the securities transferred. Such assets shall be deemed included in the Assets transferred to the Acquiring Fund on the Closing Date and shall not be separately valued.
1.6 As soon after the Closing Date as is conveniently practicable, the Fund will distribute pro rata to holders of record of the Fund's Class A, Class B, Class C and Class I shares, determined as of the close of business on the Closing Date ("Fund Shareholders"), the corresponding class of Acquiring Fund Shares received by the Fund pursuant to paragraph 1.1, and will completely liquidate and, promptly thereafter, terminate in accordance with applicable laws of the Commonwealth of Massachusetts and federal securities laws. Such distribution and liquidation will be accomplished by the transfer of the Acquiring Fund Shares then credited to the account of the Fund on the books of the Acquiring Fund to open accounts on the share records of the Acquiring Fund in the names of the Fund Shareholders and representing the respective pro rata number of the applicable Acquiring Fund Shares due such shareholders. All issued and outstanding shares of the Fund simultaneously will be canceled on the books of the Fund and will be null and void. Acquiring Fund Shares distributed to Fund Shareholders will be reflected on the books of the Acquiring Fund as uncertificated, book-entry shares; the Acquiring Fund will not issue share certificates in the Reorganization.
1.7 Ownership of Acquiring Fund Shares will be shown on the books of the Acquiring Fund's transfer agent. Acquiring Fund Shares will be issued in the manner described in the Acquiring Fund's then-current prospectus and statement of additional information.
1.8 Any transfer taxes payable upon issuance of the Acquiring Fund Shares in a name other than the registered holder of the Acquiring Fund Shares on the books of the Fund as of that time shall, as a condition of such issuance and transfer, be paid by the person to whom such Acquiring Fund Shares are to be issued and transferred.
1.9 Any reporting responsibility of the Fund, including the responsibility for filing regulatory reports, tax returns, or other documents with the Securities and Exchange Commission (the "Commission"), any state securities commission, and any federal, state or local tax authorities or any other relevant regulatory authority, is and shall remain the responsibility of the Fund up to and including the Closing Date and such later date on which the Fund's existence is terminated.
1.10 As soon as practicable after the Closing Date, the Trust shall provide the Acquiring Fund with copies of all books and records that pertain to the Fund that the Acquiring Fund is required to maintain under the Investment Company Act of 1940, as amended (the "1940 Act"), and the rules of the Commission thereunder.
2. | VALUATION. |
2.1 The value of the Fund's Assets to be acquired, and the amount of the Fund's liabilities to be assumed, by the Acquiring Fund hereunder shall be computed as of the close of trading on the floor of the New York Stock Exchange (usually 4:00 p.m., Eastern time) on the Closing Date (such time and date being hereinafter called the "Valuation Date"), using the valuation procedures set forth in the Company's Articles of Incorporation, as amended (the "Company's Charter"), and the then-current prospectus or statement of additional information of the Acquiring Fund, which are and shall be consistent with the policies currently in effect for the Fund, or such other valuation procedures as shall be mutually agreed upon by the parties hereto.
2.2 The net asset value of an Acquiring Fund Share shall be the net asset value per share computed as of the Valuation Date, using the valuation procedures set forth in the Company's Charter and the then-current prospectus or statement of additional information of the Acquiring Fund, which are and shall be consistent with the policies currently in effect for the Fund.
2.3 The number of Acquiring Fund Shares to be issued (including fractional shares, if any) in exchange for the Fund's net assets shall be determined by dividing the value of the net assets of the applicable class of the Fund determined using the same valuation procedures referred to in paragraph 2.1 by the net asset value of one Acquiring Fund Share of the corresponding class, as the case may be, determined in accordance with paragraph 2.2.
2.4 All computations of value shall be made in accordance with the regular practices of Dreyfus as fund accountant for the Fund and the Acquiring Fund.
3. | CLOSING AND CLOSING DATE. |
3.1 The Closing Date shall be January 27, 2011, or such other date as the parties, through their duly authorized officers, may mutually agree. All acts taking place at the Closing shall be deemed to take place simultaneously on the Closing Date unless otherwise provided. The Closing shall be held at 5:00 p.m., Eastern time, at the offices of Dreyfus, 200 Park Avenue, 8th Floor, New York, New York, or such other time and/or place as the parties may mutually agree.
3.2 The Custodian shall deliver at the Closing a certificate of an authorized officer stating that the Fund's Assets have been delivered in proper form to the Acquiring Fund on the Closing Date. The Fund's portfolio securities and instruments deposited with a securities depository (as defined in Rule 17f-4 under the 1940 Act) or with a permitted counterparty or futures commission merchant (as defined in Rule 17f-6 under the 1940 Act) shall be delivered to the Custodian as of the Closing Date by book entry, in accordance with the customary practices of the Custodian. The cash to be transferred by the Fund shall be delivered to the Custodian for the account of the Acquiring Fund by wire transfer of federal funds on the Closing Date.
3.3 If on the Valuation Date (a) the New York Stock Exchange or another primary trading market for portfolio securities of the Acquiring Fund or the Fund shall be closed to trading or trading thereon shall be restricted, or (b) trading or the reporting of trading on said Exchange or elsewhere shall be disrupted so that accurate appraisal of the value of the net assets of the Acquiring Fund or the Fund is impracticable, the Closing Date shall be postponed until the first business day after the day when trading shall have been fully resumed and reporting shall have been restored or such other date as the parties hereto may agree.
3.4 The Fund's transfer agent shall deliver at the Closing a certificate of an authorized officer stating that its records contain the names and addresses of the Fund Shareholders and the number and percentage ownership of outstanding shares owned by each such shareholder immediately prior to the Closing. The Acquiring Fund's transfer agent shall issue and deliver to the Trust's Secretary a confirmation evidencing the Acquiring Fund Shares to be credited on the Closing Date, or provide evidence satisfactory to the Trust that such Acquiring Fund Shares have been credited to the Fund's account on the books of the Acquiring Fund.
3.5 At the Closing, each party shall deliver to the other such bills of sale, checks, assignments, receipts or other documents as such other party or its counsel may reasonably request.
3.6 If the Fund is unable to make delivery to the Custodian pursuant to paragraph 3.2 of any of the Assets for the reason that any of such Assets have not yet been delivered to the Fund by the Fund's broker, dealer or other counterparty, then, in lieu of such delivery, the Fund shall deliver with respect to said Assets executed copies of an agreement of assignment and due bills executed on behalf of said broker, dealer or other counterparty, together with such other documents as may be required by the Acquiring Fund or the Custodian, including broker confirmation slips.
4. | REPRESENTATIONS AND WARRANTIES. |
4.1 The Trust, on behalf of the Fund, represents and warrants to the Company, on behalf of the Acquiring Fund, as follows:
(a) The Fund is a duly established and designated series of the Trust, a voluntary association with transferable shares of the type commonly referred to as a Massachusetts business trust, duly organized and validly existing under the laws of the Commonwealth of Massachusetts, and has the power to carry out its obligations under this Agreement.
(b) The Trust is registered under the 1940 Act as an open-end management investment company, and the Fund's shares are registered under the Securities Act of 1933, as amended (the "1933 Act"), and such registrations have not been revoked or rescinded and are in full force and effect. The Fund is in compliance in all material respects with the 1940 Act and the rules and regulations thereunder.
(c) The current prospectus and statement of additional information of the Fund conform in all material respects to the applicable requirements of the 1933 Act and the 1940 Act and the rules and regulations of the Commission thereunder and do not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.
(d) The Fund is not, and the execution, delivery and performance of this Agreement will not result, in material violation of the Trust's Amended and Restated Agreement and Declaration of Trust (the "Trust's Trust Agreement"), or its By-Laws or of any agreement, indenture, instrument, contract, lease or other undertaking to which the Trust is a party on behalf of the Fund or by which the Fund is bound, nor will the execution, delivery and performance of this Agreement by the Fund result in the acceleration of any obligation, or the imposition of any penalty, under any agreement, indenture, instrument, contract, lease or other undertaking to which the Trust is a party on behalf of the Fund or by which the Fund is bound.
(e) The Fund has no material contracts or other commitments that will be terminated with liability to the Fund on or prior to the Closing Date.
(f) No consent, approval, authorization, or order of any court or governmental authority is required for the consummation by the Fund of the transactions contemplated herein, except as may be required under the 1933 Act, the Securities Exchange Act of 1934, as amended (the "1934 Act"), and the 1940 Act and by state securities laws.
(g) No litigation or administrative proceeding or investigation of or before any court or governmental body is currently pending or to the Trust's knowledge threatened against the Fund or any of the Fund's properties or assets which, if adversely determined, would materially and adversely affect the Fund's financial condition or the conduct of the Fund's business. The Fund knows of no facts which might form the basis for the institution of such proceedings, and is not a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially and adversely affects the Fund's business or the Fund's ability to consummate the transactions contemplated herein.
(h) The Statements of Assets and Liabilities, Statements of Operations, Statements of Changes in Net Assets and Statement of Investments (indicating their market values) of the Fund for each of the Fund's five fiscal years ended March 31, 2010 have been audited by Ernst & Young LLP, an independent registered public accounting firm, and are in accordance with GAAP, consistently applied, and such statements (copies of which have been furnished to the Acquiring Fund) fairly reflect the financial condition of the Fund as of such dates, and there are no known contingent liabilities of the Fund as of such dates not disclosed therein.
(i) Since March 31, 2010, there has not been any material adverse change in the Fund's financial condition, assets, liabilities or business other than changes occurring in the ordinary course of business, or any incurrence by the Fund of indebtedness maturing more than one year from the date such indebtedness was incurred, except as disclosed on the statement of assets and liabilities referred to in paragraphs 1.3 and 4.1(h) hereof.
(j) At the Closing Date, all federal and other tax returns and reports of the Fund required by law then to be filed shall have been filed, and all federal and other taxes shown as due on said returns and reports shall have been paid so far as due, or provision shall have been made for the payment thereof, and to the knowledge of the Trust no such return is currently under audit and no assessment or deficiency has been asserted with respect to such returns.
(k) For each taxable year of its operation (including the taxable year ending on the Closing Date), the Fund has met the requirements of Subchapter M of the Code for qualification and treatment as a regulated investment company.
(l) All issued and outstanding shares of the Fund are, and at the Closing Date will be, duly and validly issued and outstanding, fully paid and non-assessable by the Fund. All of the issued and outstanding shares of the Fund will, at the time of the Closing, be held by the persons and in the amounts set forth in the records of its transfer agent as provided in paragraph 3.4. The Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any of the Fund's shares, nor is there outstanding any security convertible into any of the Fund's shares.
(m) On the Closing Date, the Fund will have good and marketable title to the Assets and full right, power and authority to sell, assign, transfer and deliver the Assets to be transferred by it hereunder free of any liens or other encumbrances, and upon delivery and payment for the Assets, the Acquiring Fund will acquire good and marketable title thereto, subject to no restrictions on the full transfer thereof, including such restrictions as might arise under the 1933 Act, other than as disclosed to and accepted by the Acquiring Fund.
(n) The execution, delivery and performance of this Agreement will have been duly authorized prior to the Closing Date by all necessary action on the part of the Trust's Board and, subject to the approval of the Fund's shareholders, this Agreement will constitute the valid and legally binding obligation of the Trust, on behalf of the Fund, enforceable in accordance with its terms, subject to the effect of bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other similar laws relating to or affecting creditors' rights generally and court decisions with respect thereto, and to general principles of equity and the discretion of the court (regardless of whether the enforceability is considered in a proceeding in equity or at law).
(o) The information to be furnished by the Trust, on behalf of the Fund, for use in registration statements, proxy materials and other documents filed or to be filed with any federal, state or local regulatory authority (including the Financial Industry Regulatory Authority), which may be necessary in connection with the transactions contemplated hereby, shall be accurate and complete in all material respects and shall comply in all material respects with federal securities and other laws and regulations applicable thereto.
(p) The Registration Statement on Form N-14 and the Prospectus/Proxy Statement contained therein as amended or supplemented (the "Registration Statement"), as of the effective date of the Registration Statement and at all times subsequent thereto up to and including the Closing Date, conform and will conform, as it relates to the Trust and the Fund, in all material respects to the requirements of the federal and state securities laws and the rules and regulations thereunder and do not and will not include, as it relates to the Trust and the Fund, any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which such statements were made, not misleading.
4.2 The Company, on behalf of the Acquiring Fund, represents and warrants to the Trust, on behalf of the Fund, as follows:
(a) The Acquiring Fund is a duly established and designated series of the Company, a corporation duly organized and validly existing under the laws of the State of Maryland, and has the power to carry out its obligations under this Agreement.
(b) The Company is registered under the 1940 Act as an open-end management investment company, and the Acquiring Fund's shares are registered under the 1933 Act, and such registrations have not been revoked or rescinded and are in full force and effect. The Acquiring Fund is in compliance in all material respects with the 1940 Act and the rules and regulations thereunder.
(c) The current prospectus and statement of additional information of the Acquiring Fund conform in all material respects to the applicable requirements of the 1933 Act and the 1940 Act and the rules and regulations of the Commission thereunder and do not include any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.
(d) The Acquiring Fund is not, and the execution, delivery and performance of this Agreement will not result, in material violation of the Company's Charter or its By-Laws or of any agreement, indenture, instrument, contract, lease or other undertaking to which the Company is a party on behalf of the Acquiring Fund or by which the Acquiring Fund is bound, nor will the execution, delivery and performance of this Agreement by the Acquiring Fund result in the acceleration of any obligation, or the imposition of any penalty, under any agreement, indenture, instrument, contract, lease or other undertaking to which the Company is a party on behalf of the Acquiring Fund or by which the Acquiring Fund is bound.
(e) No consent, approval, authorization, or order of any court or governmental authority is required for the consummation by the Acquiring Fund of the transactions contemplated herein, except as may be required under the 1933 Act, the 1934 Act and the 1940 Act and by state securities laws.
(f) No litigation or administrative proceeding or investigation of or before any court or governmental body is currently pending or to the Company's knowledge threatened against the Acquiring Fund or any of the Acquiring Fund's properties or assets which, if adversely determined, would materially and adversely affect the Acquiring Fund's financial condition or the conduct of the Acquiring Fund's business. The Acquiring Fund knows of no facts which might form the basis for the institution of such proceedings, and is not a party to or subject to the provisions of any order, decree or judgment of any court or governmental body which materially and adversely affects the Acquiring Fund's business or the Acquiring Fund's ability to consummate the transactions contemplated herein.
(g) The Statements of Assets and Liabilities, Statements of Operations, Statements of Changes in Net Assets and Statement of Investments (indicating their market values) of the Acquiring Fund for each of the Acquiring Fund's five fiscal years ended December 31, 2009 have been audited by Ernst & Young LLP, an independent registered public accounting firm, and are in accordance with GAAP, consistently applied, and such statements (copies of which have been furnished to the Fund) fairly reflect the financial condition of the Acquiring Fund as of such dates.
(h) Since December 31, 2009, there has not been any material adverse change in the Acquiring Fund's financial condition, assets, liabilities or business other than changes occurring in the ordinary course of business, or any incurrence by the Acquiring Fund of indebtedness maturing more than one year from the date such indebtedness was incurred, except as disclosed on the statement of assets and liabilities referred to in paragraph 4.2(g) hereof.
(i) At the Closing Date, all federal and other tax returns and reports of the Acquiring Fund required by law then to be filed shall have been filed, and all federal and other taxes shown as due on said returns and reports shall have been paid so far as due, or provision shall have been made for the payment thereof, and to the knowledge of the Company no such return is currently under audit and no assessment or deficiency has been asserted with respect to such returns.
(j) For each taxable year of its operation, the Acquiring Fund has met the requirements of Subchapter M of the Code for qualification and treatment as a regulated investment company.
(k) All issued and outstanding shares of the Acquiring Fund are, and at the Closing Date (including the shares of the Acquiring Fund to be issued pursuant to paragraph 1.1 of this Agreement) will be, duly and validly issued and outstanding, fully paid and non-assessable by the Acquiring Fund. The Acquiring Fund does not have outstanding any options, warrants or other rights to subscribe for or purchase any of the Acquiring Fund Shares, nor is there outstanding any security convertible into any Acquiring Fund Shares.
(l) The execution, delivery and performance of this Agreement will have been duly authorized prior to the Closing Date by all necessary action on the part of the Company's Board and, subject to the approval of the Fund's shareholders, this Agreement will constitute the valid and legally binding obligation of the Company, on behalf of the Acquiring Fund, enforceable in accordance with its terms, subject to the effect of bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance and other similar laws relating to or affecting creditors' rights generally and court decisions with respect thereto, and to general principles of equity and the discretion of the court (regardless of whether the enforceability is considered in a proceeding in equity or at law).
(m) The Registration Statement as of its effective date and at all times subsequent thereto up to and including the Closing Date, conforms and will conform, as it relates to the Acquiring Fund, in all material respects to the requirements of the federal and state securities laws and the rules and regulations thereunder and does not and will not include, as it relates to the Acquiring Fund, any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which such statements were made, not misleading. No representations and warranties in this paragraph 4.2 shall apply to statements or omissions made in reliance upon and in conformity with written information concerning the Fund furnished to the Acquiring Fund by the Trust.
(n) No consideration other than the Acquiring Fund Shares (and the Acquiring Fund's assumption of the Fund's stated liabilities) will be issued in exchange for the Fund's assets in the Reorganization.
(o) The Acquiring Fund does not directly or indirectly own, nor on the Closing Date will it directly or indirectly own, nor has it directly or indirectly owned at any time during the past five years, any shares of the Fund.
5. | COVENANTS OF THE COMPANY AND THE TRUST, ON BEHALF OF THE ACQUIRING FUND AND THE FUND, RESPECTIVELY. |
5.1 The Acquiring Fund and the Fund each will operate its business in the ordinary course between the date hereof and the Closing Date, it being understood that such ordinary course of business will include payment of customary dividends and other distributions.
5.2 The Trust will call a meeting of the Fund's shareholders to consider and act upon this Agreement and to take all other action necessary to obtain approval of the transactions contemplated herein.
5.3 Subject to the provisions of this Agreement, the Fund and the Acquiring Fund will each take, or cause to be taken, all action, and do or cause to be done, all things reasonably necessary, proper or advisable to consummate and make effective the transactions contemplated by this Agreement.
5.4 As promptly as practicable, but in any case within sixty days after the Closing Date, the Trust shall furnish the Acquiring Fund, in such form as is reasonably satisfactory to the Acquiring Fund, a statement of the earnings and profits of the Fund for federal income tax purposes which will be carried over to the Acquiring Fund as a result of Section 381 of the Code and which will be certified by the Trust's President or its Vice President and Treasurer.
5.5 The Trust, on behalf of the Fund, will provide the Acquiring Fund with information reasonably necessary for the preparation of the Registration Statement.
5.6 The Acquiring Fund agrees to use all reasonable efforts to obtain the approvals and authorizations required by the 1933 Act, the 1940 Act and such of the state Blue Sky or securities laws as it may deem appropriate in order to continue its operations after the Closing Date.
5.7 The Trust, on behalf of the Fund, covenants that the Fund is not acquiring the Acquiring Fund Shares to be issued hereunder for the purpose of making any distribution thereof, other than in accordance with the terms of this Agreement.
5.8 As soon as is reasonably practicable after the Closing, the Fund will make a liquidating distribution to the Fund's shareholders consisting of the Acquiring Fund Shares received at the Closing.
6. | CONDITIONS PRECEDENT TO OBLIGATIONS OF THE ACQUIRING FUND. |
The obligations of the Acquiring Fund to consummate the transactions provided for herein shall be subject, at its election, to the performance by the Fund of all the obligations to be performed by it hereunder on or before the Closing Date and, in addition thereto, the following conditions:
6.1 All representations and warranties of the Trust, on behalf of the Fund, contained in this Agreement shall be true and correct in all material respects as of the date hereof and, except as they may be affected by the transactions contemplated by this Agreement, as of the Closing Date with the same force and effect as if made on and as of the Closing Date.
6.2 The Trust shall have delivered to the Acquiring Fund a statement of the Fund's assets and liabilities, together with a list of the Fund's portfolio securities showing the tax basis of such securities by lot and the holding periods of such securities, as of the Closing Date, certified by the Trust's Treasurer.
6.3 The Trust shall have delivered to the Acquiring Fund on the Closing Date a certificate executed in the Trust's name by the Trust's President or Vice President and its Treasurer, in form and substance satisfactory to the Acquiring Fund, to the effect that the representations and warranties of the Trust, on behalf of the Fund, made in this Agreement are true and correct at and as of the Closing Date, except as they may be affected by the transactions contemplated by this Agreement, and as to such other matters as the Acquiring Fund shall reasonably request.
7. | CONDITIONS PRECEDENT TO OBLIGATIONS OF THE FUND. |
The obligations of the Fund to consummate the transactions provided for herein shall be subject, at its election, to the performance by the Acquiring Fund of all the obligations to be performed by it hereunder on or before the Closing Date and, in addition thereto, the following conditions:
7.1 All representations and warranties of the Company, on behalf of the Acquiring Fund, contained in this Agreement shall be true and correct in all material respects as of the date hereof and, except as they may be affected by the transactions contemplated by this Agreement, as of the Closing Date with the same force and effect as if made on and as of the Closing Date.
7.2 The Company shall have delivered to the Fund on the Closing Date a certificate executed in the Company's name by the Company's President or Vice President and its Treasurer, in form and substance reasonably satisfactory to the Fund, to the effect that the representations and warranties of the Company, on behalf of the Acquiring Fund, made in this Agreement are true and correct at and as of the Closing Date, except as they may be affected by the transactions contemplated by this Agreement, and as to such other matters as the Fund shall reasonably request.
8. | FURTHER CONDITIONS PRECEDENT TO OBLIGATIONS OF THE FUND AND THE ACQUIRING FUND. |
If any of the conditions set forth below do not exist on or before the Closing Date with respect to the Fund or the Acquiring Fund, the other party to this Agreement shall, at its option, not be required to consummate the transactions contemplated by this Agreement.
8.1 This Agreement and the transactions contemplated herein shall have been approved by the requisite vote of the holders of the outstanding shares of the Fund in accordance with the provisions of the Trust's Trust Agreement and the 1940 Act.
8.2 On the Closing Date, no action, suit or other proceeding shall be pending before any court or governmental agency in which it is sought to restrain or prohibit, or obtain damages or other relief in connection with, this Agreement or the transactions contemplated herein.
8.3 All consents of other parties and all other consents, orders and permits of federal, state and local regulatory authorities (including those of the Commission and of state Blue Sky and securities authorities) deemed necessary by the Fund or the Acquiring Fund to permit consummation, in all material respects, of the transactions contemplated hereby shall have been obtained, except where failure to obtain any such consent, order or permit would not involve a risk of a material adverse effect on the assets or properties of the Fund or the Acquiring Fund, provided that either party hereto may for itself waive any of such conditions.
8.4 The Registration Statement shall have become effective under the 1933 Act and no stop orders suspending the effectiveness thereof shall have been issued and, to the best knowledge of the parties hereto, no investigation or proceeding for that purpose shall have been instituted or be pending, threatened or contemplated under the 1933 Act.
8.5 The Fund shall have declared and paid a dividend or dividends which, together with all previous dividends, shall have the effect of distributing to Fund shareholders all of the Fund's investment company taxable income (within the meaning of Section 852(b)(2) of the Code) for all taxable years or periods ending on or prior to the Closing Date (computed without regard to any deduction for dividends paid); the excess of its interest income excludable from gross income under Section 103(a) of the Code over its disallowed deductions under Sections 265 and 171(a)(2) of the Code, for all taxable years or periods; and all of its net capital gain (as defined in Section 1222(11) of the Code) realized in all taxable years or periods (after reduction for any capital loss carryforward).
8.6 The Fund and Acquiring Fund shall have received an opinion of Stroock & Stroock & Lavan LLP substantially to the effect that based on the facts and assumptions stated herein and conditioned on consummation of the Reorganization in accordance with this Agreement, for federal income tax purposes:
(a) The transfer of all of the Fund's assets to the Acquiring Fund in exchange solely for the Acquiring Fund Shares and the assumption by the Acquiring Fund of certain identified liabilities of the Fund, followed by the distribution by the Fund of those Acquiring Fund Shares to Fund Shareholders in complete liquidation of the Fund, will qualify as a "reorganization" within the meaning of Section 368(a) of the Code and each of the Fund and the Acquiring Fund will be "a party to a reorganization"; (b) no gain or loss will be recognized by the Acquiring Fund upon the receipt of the assets of the Fund in exchange solely for Acquiring Fund Shares and the assumption by the Acquiring Fund of certain identified liabilities of the Fund pursuant to the Reorganization; (c) no gain or loss will be recognized by the Fund upon the transfer of the Fund's assets to the Acquiring Fund in exchange solely for Acquiring Fund Shares and the assumption by the Acquiring Fund of certain identified liabilities of the Fund or upon the distribution (whether actual or constructive) of those Acquiring Fund Shares to Fund Shareholders in exchange for their shares of the Fund in liquidation of the Fund pursuant to the Reorganization; (d) no gain or loss will be recognized by Fund Shareholders upon the exchange of their Fund shares for the Acquiring Fund Shares pursuant to the Reorganization; (e) the aggregate tax basis for the Acquiring Fund Shares received by each Fund Shareholder pursuant to the Reorganization will be the same as the aggregate tax basis of the Fund shares held by such Shareholder immediately prior to the Reorganization, and the holding period of those Acquiring Fund Shares received by each Fund Shareholder will include the period during which the Fund shares exchanged therefor were held by such Shareholder (provided the Fund shares were held as capital assets on the date of the Reorganization); and (f) the tax basis of each Fund asset acquired by the Acquiring Fund will be the same as the tax basis of such asset to the Fund immediately prior to the Reorganization, and the holding period of each asset of the Fund in the hands of the Acquiring Fund will include the period during which that asset was held by the Fund.
In rendering its opinion, counsel may rely as to factual matters, exclusively and without independent verification, on the representations and warranties made in this Agreement, which counsel may treat as representations and warranties made to it, and in separate letters addressed to counsel and the certificates delivered pursuant to this Agreement.
No opinion will be expressed as to the effect of the Reorganization on (i) the Fund or the Acquiring Fund with respect to any asset as to which any unrealized gain or loss is required to be recognized for federal income tax purposes at the end of a taxable year (or on the termination or transfer thereof) under a mark-to-market system of accounting, and (ii) any Fund Shareholder that is required to recognize unrealized gains and losses for federal income tax purposes under a mark-to-market system of accounting.
9. | TERMINATION OF AGREEMENT; EXPENSES. |
9.1 This Agreement and the transactions contemplated hereby may be terminated and abandoned by resolution of the Board of the Trust or of the Company, as the case may be, at any time prior to the Closing Date (and notwithstanding any vote of the Fund's shareholders) if circumstances should develop that, in the opinion of the party's Board, make proceeding with the Reorganization inadvisable.
9.2 If this Agreement is terminated and the transactions contemplated hereby are abandoned pursuant to the provisions of this Section 9, this Agreement shall become void and have no effect, without any liability on the part of any party hereto or the Board members or officers of the Trust or the Company, or shareholders of the Fund or of the Acquiring Fund, as the case may be, in respect of this Agreement.
9.3 Each party acknowledges that all expenses directly incurred in connection with the Reorganization will be borne by Dreyfus.
10. | WAIVER. |
At any time prior to the Closing Date, except as otherwise expressly provided, any of the foregoing conditions may be waived by the Board of the Trust or of the Company if, in the judgment of either, such waiver will not have a material adverse effect on the benefits intended under this Agreement to the shareholders of the Fund or of the Acquiring Fund, as the case may be.
11. | MISCELLANEOUS. |
11.1 None of the representations and warranties included or provided for herein shall survive consummation of the transactions contemplated hereby.
11.2 This Agreement contains the entire agreement and understanding between the parties hereto with respect to the subject matter hereof, and merges and supersedes all prior discussions, agreements and understandings of every kind and nature between them relating to the subject matter hereof. Neither party shall be bound by any condition, definition, warranty or representation, other than as set forth or provided in this Agreement or as may be, on or subsequent to the date hereof, set forth in a writing signed by the party to be bound thereby.
11.3 This Agreement shall be governed and construed in accordance with the internal laws of the State of New York, without giving effect to principles of conflict of laws; provided, however, that the due authorization, execution and delivery of this Agreement by the Trust, on behalf of the Fund, and the Company, on behalf of the Acquiring Fund, shall be governed and construed in accordance with the internal laws of the Commonwealth of Massachusetts and the State of Maryland, respectively, without giving effect to principles of conflict of laws; provided that, in the case of any conflict between those laws and the federal securities laws, the latter shall govern.
11.4 This Agreement may be amended only by a signed writing between the parties.
11.5 This Agreement may be executed in counterparts, each of which, when executed and delivered, shall be deemed to be an original.
11.6 This Agreement shall bind and inure to the benefit of the parties hereto and their respective successors and assigns, but no assignment or transfer hereof or of any rights or obligations hereunder shall be made by any party without the written consent of the other party. Nothing herein expressed or implied is intended or shall be construed to confer upon or give any person, firm or corporation, other than the parties hereto and their respective successors and assigns, any rights or remedies under or by reason of this Agreement.
11.7 It is expressly agreed that the obligations of the parties hereunder shall not be binding upon any of the Board members or officers of the Company or the Trust, or shareholders, nominees, agents, or employees of the Acquiring Fund or the Fund personally, but shall bind only the property of the Acquiring Fund or the Fund, as the case may be, as provided in the Company's Charter or the Trust's Trust Agreement; a copy of the Trust's Trust Agreement is on file at the office of the Secretary of the Commonwealth of Massachusetts and at the Trust's principal offices. The execution and delivery of this Agreement by such officers shall not be deemed to have been made by any of them individually or to impose any liability on any of them personally, but shall bind only the property of the Acquiring Fund or the Fund, as the case may be.
IN WITNESS WHEREOF, the Trust, on behalf of the Fund, and the Company, on behalf of the Acquiring Fund, have each caused this Agreement and Plan of Reorganization to be executed and attested on its behalf by its duly authorized representatives as of the date first above written.
DREYFUS MANAGER FUNDS I, on behalf of Dreyfus S&P STARS Opportunities Fund | ||
By: | ||
Bradley J. Skapyak, President |
ATTEST: | |
Jeff Prusnofsky, Assistant Secretary |
STRATEGIC FUNDS, INC., on behalf of Dreyfus Active MidCap Fund | ||
By: | ||
Bradley J. Skapyak, President |
ATTEST: | |
Jeff Prusnofsky, Assistant Secretary |
EXHIBIT B
DESCRIPTION OF THE COMPANY'S BOARD MEMBERS
Board members of the Company, together with information as to their positions with the Company, principal occupations and other board memberships for the past five years, are shown below.1
Name (Age) Position with Company (Since) | Principal Occupation During Past 5 Years | Other Public Company Board Memberships During Past 5 Years | ||
Joseph S. DiMartino (66) Chairman of the Board (1995) | Corporate Director and Trustee | CBIZ (formerly, Century Business Services, Inc.), a provider of outsourcing functions for small and medium size companies, Director (1997 – present) The Newark Group, a provider of a national market of paper recovery facilities, paperboard mills and paperboard converting plants, Director (2000 – present) Sunair Services Corporation, a provider of certain outdoor-related services to homes and businesses, Director (2005 – 2009) | ||
David W. Burke (74) Board Member (1994) | Corporate Director and Trustee | N/A | ||
William Hodding Carter III (75) Board Member (1988) | Professor of Leadership & Public Policy, University of North Carolina, Chapel Hill (2006 – present) President and Chief Executive Officer of the John S. and James L. Knight Foundation (1998 – 2006) | N/A | ||
Gordon J. Davis (68) Board Member (2006) | Partner in the law firm of Dewey & LeBoeuf LLP | Consolidated Edison, Inc., a utility company, Director (1997 – present) Phoenix Companies, Inc., a life insurance company, Director (2000 – present) | ||
Joni Evans (68) Board Member (2006) | Chief Executive Officer, www.wowOwow.com, an online community dedicated to women's conversations and publications Principal, Joni Evans Ltd. (publishing) Senior Vice President of the William Morris Agency (1994 – 2006) | N/A | ||
Ehud Houminer (69) Board Member (1994) | Executive-in-Residence at the Columbia Business School, Columbia University | Avnet, Inc., an electronics distributor, Director (1993 – present) | ||
Richard C. Leone (70) Board Member (1984) | President of The Century Foundation (formerly, The Twentieth Century Fund, Inc.), a tax exempt research foundation engaged in the study of economic, foreign policy and domestic issues | N/A | ||
Hans C. Mautner (72) Board Member (1984) | President – International Division and an Advisory Director of Simon Property Group, a real estate investment company Chairman and Chief Executive Officer of Simon Global Limited, a real estate company (1999 – present) | N/A | ||
Robin A. Melvin (46) Board Member (1995) | Director, Boisi Family Foundation, a private family foundation that supports youth-serving organizations that promote the self sufficiency of youth from disadvantaged circumstances (1995 – present) Senior Vice President, MENTOR, a national non-profit youth mentoring organization (1992 – 2005) | N/A | ||
Burton N. Wallack (59) Board Member (2006) | President and Co-owner of Wallack Management Company, a real estate management company | N/A | ||
John E. Zuccotti (73) Board Member (1984) | Chairman of Brookfield Financial Properties, Inc. Senior Counsel of Weil, Gotshal & Manges, LLP Emeritus Chairman of the Real Estate Board of New York | Wellpoint, Inc., a health benefits company, Director (2005 – present) |
________________________
1 None of the Board members are "interested persons" of the Company, as defined in the 1940 Act.
Each Board member of the Company, as is the case with each Board member of the Trust, has been a Board member of other Dreyfus mutual funds for over 10 years. Additional information about each Board member of the Company follows (supplementing the information provided in the table above) that describes some of the specific experiences, qualifications, attributes or skills that each such Board member possesses which the Board of the Company believes has prepared them to be effective Board members. The Board of the Company believes that the significance of each Board member's experience, qualifications, attributes or skills is an individual matter (meaning that experience that is important for one Board member may not have the same value for another) and that these factors are best evaluated at the board level, with no single Board member, or particular factor, being indicative of board effectiveness. However, the Board of the Company, as does the Board of the Trust, believes that Board members need to have the ability to critically review, evaluate, question and discuss information provided to them, and to interact effectively with fund management, service providers and counsel, in order to exercise effective business judgment in the performance of their duties; the Board of the Company believes that its members satisfy this standard. Experience relevant to having this ability may be achieved through a Board member's educational background; business, professional training or practice (e.g., medicine, accounting or law), public service or academic positions; experience from service as a board member (including the Board of the Company) or as an executive of investment funds, public companies or significant private or not-for-profit entities or other organizations; and/or other life experiences. The charter for the nominating committee of the Board of the Company contains certain other factors considered by the committee in identifying and evaluating potential Board member nominees. To assist them in evaluating matters under federal and state law, the Board members of the Company are counseled by their own independent legal counsel, who participates in Board meetings and interacts with Dreyfus, and also may benefit from information provided by Dreyfus' counsel. The Board of the Company and its committees have the ability to engage other experts as appropriate. The Company's Board evaluates its performance on an annual basis.
● | Joseph S. DiMartino – Mr. DiMartino has been the Chairman of the Board of the funds in the Dreyfus Family of Funds for over 15 years. From 1971 through 1994, Mr. DiMartino served in various roles as an employee of Dreyfus (prior to its acquisition by a predecessor of BNY Mellon in August 1994 and related management changes), including portfolio manager, President, Chief Operating Officer and a Director. He ceased being an employee or Director of Dreyfus by the end of 1994. From July 1995 to November 1997, Mr. DiMartino served as Chairman of the Board of The Noel Group, a public buyout firm; in that capacity, he helped manage, acquire, take public and liquidate a number of operating companies. Mr. DiMartino has been a Director of The Muscular Dystrophy Association since 1986. |
● | David W. Burke – Mr. Burke was previously a member of the Labor-Management Committee for the U.S. Department of Commerce, Executive Secretary to the President's Advisory Committee on Labor-Management Policy, Secretary to the Governor of the State of New York and Chief of Staff for Senator Edward M. Kennedy. In addition, Mr. Burke previously served as the President of CBS News and as the Chairman of the federal government's Broadcasting Board of Governors, which oversees the Voice of America, Radio Free Europe, Radio Free Asia and other U.S. government-sponsored international broadcasts. Mr. Burke also was a Vice President and Chief Operating Officer of Dreyfus (prior to its acquisition by a predecessor of BNY Mellon in August 1994 and related management changes). |
● | William Hodding Carter III – Mr. Carter served as spokesman of the Department of State and as Assistant Secretary of State for Public Affairs in the Carter administration. Mr. Carter held the Knight Chair in Journalism at the University of Maryland College of Journalism from 1995 to 1998, and is now the University Professor of Leadership and Public Policy at the University of North Carolina at Chapel Hill. Mr. Carter's work as a journalist includes serving as Chief Correspondent on "Frontline," public television's flagship public affairs series. |
● | Gordon J. Davis – Mr. Davis is a partner in the law firm of Dewey & LeBoeuf LLP, where his practice involves complex real estate, land use development and related environmental matters. Prior to joining the firm, Mr. Davis served as a Commissioner and member of the New York City Planning Commission, and as Commissioner of Parks and Recreation for the City of New York. Mr. Davis was a co-founder of the Central Park Conservancy and the founding Chairman of Jazz at the Lincoln Center for the Performing Arts in New York City. He has also served as President of Lincoln Center. Mr. Davis also served on the board of Dreyfus (prior to its acquisition by a predecessor of BNY Mellon in August 1994 and related management changes). |
● | Joni Evans – Ms. Evans has more than 35 years experience in the publishing industry, serving as Publisher of Random House, Inc., President and Publisher of Simon & Schuster, Inc. and, most recently, Senior Vice President of the William Morris Agency, Inc.'s literary department until 2006. Ms. Evans is a member of the Young Presidents' Organization and the Women's Forum, and is a founding member of The Committee of 200 and Women's Media Group. |
● | Ehud Houminer – Mr. Houminer currently serves on Columbia Business School's Board of Overseers. Prior to his association with Columbia Business School beginning in 1991, Mr. Houminer held various senior financial, strategic and management positions at Philip Morris Companies Inc., including serving as Senior Corporate Vice President for Corporate Planning, and as President and Chief Executive Officer of Philip Morris USA, Inc. (now part of Altria Group, Inc.). Mr. Houminer is Chairman of the Business School Board and a Trustee of Ben Gurion University. |
● | Richard C. Leone – Mr. Leone currently serves as President of the Century Foundation (formerly named the Twentieth Century Fund), a non-profit public policy research foundation. Prior to that, Mr. Leone served as Chairman of the Port Authority of New York and New Jersey and as State Treasurer of New Jersey. Mr. Leone also has served as President of the New York Mercantile Exchange and was a Managing Director at Dillon Read and Co., an investment banking firm. He is a member of the Council on Foreign Relations and the National Academy of Social Insurance. |
● | Hans C. Mautner – Mr. Mautner is President of the International Division of Simon Property Group, Inc. and Chairman of Simon Global Limited. Mr. Mautner previously served as Vice Chairman of the Board of Directors of Simon Property Group, Inc., Chairman of the Board of Directors and Chief Executive Officer of Corporate Property Investors and as a General Partner of Lazard Frères. In addition, Mr. Mautner is currently Chairman of Simon Ivanhoe BV/SARL and Chairman of Gallerie Commerciali Italia S.p.A. |
● | Robin A. Melvin – Ms. Melvin is currently a Director of the Boisi Family Foundation, a private family foundation that supports organizations serving the needs of youth from disadvantaged circumstances. In that role she also manages the Boisi Family Office, providing the primary interface with all investment managers, legal advisors and other service providers to the family. She has also served in various roles with MENTOR, a national non-profit youth mentoring advocacy organization, including Executive Director of the New York City affiliate, Vice President of the national affiliate network, Vice President of Development, and, immediately prior to her departure, Senior Vice President in charge of strategy. Prior to that, Ms. Melvin served as an investment banker with Goldman Sachs Group, Inc. |
● | Burton N. Wallack – Mr. Wallack is President and co-owner of Wallack Management Company, a real estate management company that provides financial reporting and management services. |
● | John E. Zuccotti – Mr. Zuccotti is senior counsel to the law firm of Weil, Gotshal & Manges LLP, focusing his legal practice on real estate, land use and development. Prior to that, Mr. Zuccotti served as First Deputy Mayor of the City of New York and as Chairman of the New York City Planning Commission. In addition, Mr. Zuccotti has served as a member of the boards of Empire BlueCross BlueShield, Applied Graphics Technologies, Inc. and Olympia & York Companies (U.S.A.), and as Chairman of the board of directors of Brookfield Financial Properties, Inc. since 1996. |
DREYFUS S&P STARS OPPORTUNITIES FUND
The undersigned shareholder of Dreyfus S&P STARS Opportunities Fund (the "Fund"), a series of Dreyfus Manager Funds I (the "Trust"), hereby appoints Jeff Prusnofsky and Joseph M. Chioffi, and each of them, the attorneys and proxies of the undersigned, with full power of substitution, to vote, as indicated herein, all of the shares of beneficial interest of the Fund standing in the name of the undersigned at the close of business on September 1, 2010, at a Special Meeting of Shareholders to be held at the offices of The Dreyfus Corporation, 200 Park Avenue, 8th Floor, New York, New York 10166, at 10:00 a.m., on Wednesday, November 17, 2010, and at any and all adjournments thereof, with all of the powers the undersigned would possess if then and there personally present and especially (but without limiting the general authorization and power hereby given) to vote as indicated on the proposal, as more fully described in the Prospectus/Proxy Statement for the meeting.
THIS PROXY IS SOLICITED BY THE TRUST'S BOARD OF TRUSTEES AND WILL BE VOTED FOR THE PROPOSAL SHOWN ON THE REVERSE SIDE UNLESS OTHERWISE INDICATED.
THREE EASY WAYS TO VOTE YOUR PROXY
1. | TELEPHONE: Call 1-800-690-6903 and follow the simple instructions. |
2. | INTERNET: Go to www.proxyvote.com, and follow the on-line directions. |
3. | MAIL: Vote, sign and date, and return in the enclosed postage-paid envelope. |
If you are NOT voting by Telephone or Internet, Please Sign, Date and Return the Proxy Card Promptly Using the Enclosed Envelope.
Dated: ________________________ | |
Sign, Date and Return the Proxy Card Promptly Using the Enclosed Envelope ______________________________ | |
Signature(s) (Sign in the Box) | |
Signature(s) should be exactly as name or names appearing on this proxy. If shares are held jointly, each holder should sign. If signing is by attorney, executor, administrator, trustee or guardian, please give full title. By signing this proxy card, receipt of the accompanying Notice of Special Meeting of Shareholders and Prospectus/Proxy Statement is acknowledged. |
TO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS: T
1. | To approve an Agreement and Plan of Reorganization providing for the transfer of all of the assets of the Fund to Dreyfus Active MidCap Fund (the "Acquiring Fund"), in exchange for Class A, Class B, Class C and Class I shares of the Acquiring Fund having an aggregate net asset value equal to the value of the Fund's net assets and the assumption by the Acquiring Fund of the Fund's stated liabilities (the "Reorganization"). Class A, Class B, Class C and Class I shares of the Acquiring Fund received by the Fund in the Reorganization will be distributed by the Fund to its Class A, Class B, Class C and Class I shareholders, respectively, in liquidation of the Fund, after which the Fund will cease operations and will be terminated as a series of the Trust. |
FOR | AGAINST | ABSTAIN | |
¨ | ¨ | ¨ |
2. | In their discretion, the proxies are authorized to vote upon such other business as may properly come before the meeting, or any adjournment(s) thereof. |
PLEASE SIGN AND DATE ON THE REVERSE SIDE.
STATEMENT OF ADDITIONAL INFORMATION |
August __, 2010 |
Acquisition of the Assets of |
DREYFUS S&P STARS OPPORTUNITIES FUND (A Series of Dreyfus Manager Funds I) |
144 Glenn Curtiss Boulevard |
Uniondale, New York 11556-0144 |
1-800-554-4611 |
By and in Exchange for Class A, B, C and I Shares of |
DREYFUS ACTIVE MIDCAP FUND (A Series of Strategic Funds, Inc.) |
144 Glenn Curtiss Boulevard |
Uniondale, New York 11556-0144 |
1-800-554-4611 |
This Statement of Additional Information, which is not a prospectus, supplements and should be read in conjunction with the Prospectus/Proxy Statement dated August __, 2010 relating specifically to the proposed transfer of all of the assets and liabilities of Dreyfus S&P STARS Opportunities Fund (the "Fund"), a series of Dreyfus Manager Funds I (the "Trust"), in exchange for Class A, Class B, Class C and Class I shares of Dreyfus Active MidCap Fund (the "Acquiring Fund"), a series of Strategic Funds, Inc. (the "Company"). The transfer is to occur pursuant to an Agreement and Plan of Reorganization. This Statement of Additional Information consists of this cover page and the following documents attached hereto:
1. | The Acquiring Fund's Statement of Additional Information dated May 1, 2010. |
2. | The Acquiring Fund's Annual Report for the fiscal year ended December 31, 2009. |
3. | The Acquiring Fund's Semi-Annual Report for the six-month period ended June 30, 2010. |
4. | The Fund's Statement of Additional Information dated August 1, 2010. |
5. | The Fund's Annual Report for the fiscal year ended March 31, 2010. |
6. | Pro forma financial statements for the combined Fund and Acquiring Fund as of December 31, 2009. |
The Acquiring Fund's Statement of Additional Information, and the financial statements included in the Acquiring Fund's Annual Report and Semi-Annual Report, and the Fund's Annual Report, are incorporated herein by reference. The Prospectus/Proxy Statement dated August __, 2010 may be obtained by writing to the Fund or the Acquiring Fund at 144 Glenn Curtiss Boulevard, Uniondale, New York 11556-0144.
DOCUMENTS INCORPORATED BY REFERENCE
The Acquiring Fund's Statement of Additional Information dated May 1, 2010 is incorporated herein by reference to the Company's Post-Effective Amendment No. 62 to its Registration Statement on Form N-1A, filed on April 30, 2010 (File No. 2-88816). The financial statements of the Acquiring Fund are incorporated herein by reference to its Annual Report for its fiscal year ended December 31, 2009, filed March 1, 2010.
The Fund's Statement of Additional Information dated August 1, 2010 is incorporated herein by reference to the Trust's Post-Effective Amendment No. [16] to its Registration Statement on Form N-1A, filed on _________, 2010 (File No. 333-106576). The financial statements of the Fund are incorporated herein by reference to the Fund's Annual Report for its fiscal year ended March 31, 2010, filed on May 26, 2010.
Dreyfus Active MidCap Fund |
Pro Forma Statement of Investments |
December 31, 2009 (Unaudited) |
Dreyfus Active MidCap Fund | Dreyfus Structured Midcap Fund | Dreyfus S&P STARS Opportunities S&P Fund | Dreyfus Active MidCap Fund Pro Forma Combined (*) | Dreyfus Active MidCap Fund | Dreyfus Structured Midcap Fund | Dreyfus S&P STARS Opportunities Fund | Dreyfus Active MidCap Fund Pro Forma Combined (*) | ||||||||||||||
Common Stocks--99.7% | Shares | Value ($) | |||||||||||||||||||
Commercial & Professional Services--0.9% | |||||||||||||||||||||
FactSet Research Systems | 12,300 | b | 12,300 | 810,201 | 810,201 | ||||||||||||||||
FTI Consulting | 4,400 | a | 4,400 | 207,504 | 207,504 | ||||||||||||||||
Gartner | 39,700 | a | 39,700 | 716,188 | 716,188 | ||||||||||||||||
1,733,893 | 1,733,893 | ||||||||||||||||||||
Consumer Discretionary--16.4% | |||||||||||||||||||||
Advance Auto Parts | 110,100 | a | 36,600 | a | 110,000 | 256,700 | 4,456,848 | 1,481,568 | 4,452,800 | 10,391,216 | |||||||||||
Aeropostale | 151,500 | b | 27,650 | b | 150,000 | b | 329,150 | 5,158,575 | 941,482 | 5,107,500 | 11,207,557 | ||||||||||
American Greetings, Cl. A | 33,900 | 33,900 | 738,681 | 738,681 | |||||||||||||||||
Barnes & Noble | 29,100 | a | 29,100 | 554,937 | 554,937 | ||||||||||||||||
Big Lots | 167,500 | a,b | 167,500 | 4,854,150 | 4,854,150 | ||||||||||||||||
Blyth | 6,500 | 6,500 | 219,180 | 219,180 | |||||||||||||||||
Boyd Gaming | 23,000 | a,b | 23,000 | 192,510 | 192,510 | ||||||||||||||||
Brinker International | 48,200 | 48,200 | 719,144 | 719,144 | |||||||||||||||||
Cheesecake Factory | 62,900 | a,b | 62,900 | 1,358,011 | 1,358,011 | ||||||||||||||||
Chico's FAS | 100,000 | a | 100,000 | 1,405,000 | 1,405,000 | ||||||||||||||||
Coach | 180,000 | 180,000 | 6,575,400 | 6,575,400 | |||||||||||||||||
Corinthian Colleges | 331,100 | a,b | 331,100 | 4,559,247 | 4,559,247 | ||||||||||||||||
DeVry | 7,300 | 7,300 | 414,129 | 414,129 | |||||||||||||||||
DISH Network, Cl. A | 285,300 | 285,300 | 5,925,681 | 5,925,681 | |||||||||||||||||
Dollar Tree | 119,800 | b | 23,100 | b | 21,000 | b | 163,900 | 5,786,340 | 1,115,730 | 1,014,300 | 7,916,370 | ||||||||||
Family Dollar Stores | 178,900 | 14,600 | 162,000 | 355,500 | 4,978,787 | 406,318 | 4,508,460 | 9,893,565 | |||||||||||||
Foot Locker | 78,300 | 78,300 | 872,262 | 872,262 | |||||||||||||||||
Fossil | 19,600 | b | 19,600 | 657,776 | 657,776 | ||||||||||||||||
GameStop, Cl. A | 231,900 | a,b | 100,000 | a,b | 331,900 | 5,087,886 | 2,194,000 | 7,281,886 | |||||||||||||
Garmin | 175,700 | a | 175,700 | 5,393,990 | 5,393,990 | ||||||||||||||||
H & R Block | 273,100 | 273,100 | 6,177,522 | 6,177,522 | |||||||||||||||||
IAC/InterActiveCorp | 15,100 | b | 15,100 | 309,248 | 309,248 | ||||||||||||||||
International Speedway, Cl. A | 9,400 | 9,400 | 267,430 | 267,430 | |||||||||||||||||
ITT Educational Services | 11,700 | b | 7,600 | a,b | 19,300 | 1,122,732 | 729,296 | 1,852,028 | |||||||||||||
Leggett & Platt | 107,400 | a | 107,400 | 2,190,960 | 2,190,960 | ||||||||||||||||
Lennar, Cl. A | 150,000 | 150,000 | 1,915,500 | 1,915,500 | |||||||||||||||||
Liberty Global, Cl. A | 238,600 | a,b | 238,600 | 5,227,726 | 5,227,726 | ||||||||||||||||
Panera Bread, Cl. A | 7,800 | b | 7,800 | 522,366 | 522,366 | ||||||||||||||||
PetSmart | 32,100 | 32,100 | 856,749 | 856,749 | |||||||||||||||||
Priceline.com | 21,800 | a,b | 21,800 | 4,763,300 | 4,763,300 | ||||||||||||||||
Pulte Group | 58,100 | a,b | 58,100 | 581,000 | 581,000 | ||||||||||||||||
Regal Entertainment Group, Cl. A | 23,800 | 23,800 | 343,672 | 343,672 | |||||||||||||||||
Regis | 15,100 | a | 15,100 | 235,107 | 235,107 | ||||||||||||||||
Rent-A-Center | 134,400 | b | 40,800 | b | 175,200 | 2,381,568 | 722,976 | 3,104,544 | |||||||||||||
Ross Stores | 26,700 | a | 16,500 | 43,200 | 1,140,357 | 704,715 | 1,845,072 | ||||||||||||||
Scholastic | 21,600 | a | 21,600 | 644,328 | 644,328 | ||||||||||||||||
Sherwin-Williams | 53,900 | 53,900 | 3,322,935 | 3,322,935 | |||||||||||||||||
Snap-On | 25,700 | 25,700 | 1,086,082 | 1,086,082 | |||||||||||||||||
Timberland, Cl. A | 20,500 | b | 20,500 | 367,565 | 367,565 | ||||||||||||||||
Toll Brothers | 100,000 | b | 100,000 | 1,881,000 | 1,881,000 | ||||||||||||||||
TRW Automotive Holdings | 215,200 | a,b | 215,200 | 5,138,976 | 5,138,976 | ||||||||||||||||
Under Armour, Cl. A | 93,000 | a,b | 93,000 | 2,536,110 | 2,536,110 | ||||||||||||||||
Warnaco Group | 18,600 | b | 18,600 | 784,734 | 784,734 | ||||||||||||||||
Wyndham Worldwide | 11,000 | 11,000 | 221,870 | 221,870 | |||||||||||||||||
78,783,740 | 16,203,410 | 32,319,366 | 127,306,516 | ||||||||||||||||||
Consumer Staples--4.7% | |||||||||||||||||||||
BJ's Wholesale Club | 15,000 | a,b | 15,000 | 490,650 | 490,650 | ||||||||||||||||
Coca-Cola Enterprises | 276,100 | 276,100 | 5,853,320 | 5,853,320 | |||||||||||||||||
Dean Foods | 283,100 | b | 283,100 | 5,107,124 | 5,107,124 | ||||||||||||||||
Del Monte Foods | 440,400 | 440,400 | 4,994,136 | 4,994,136 | |||||||||||||||||
Estee Lauder, Cl. A | 76,900 | 76,900 | 3,718,884 | 3,718,884 | |||||||||||||||||
Hershey | 101,600 | 101,600 | 3,636,264 | 3,636,264 | |||||||||||||||||
Hormel Foods | 20,200 | 20,200 | 776,690 | 776,690 | |||||||||||||||||
Lancaster Colony | 19,000 | 25,300 | 44,300 | 944,300 | 1,257,410 | 2,201,710 | |||||||||||||||
Lorillard | 26,400 | 26,400 | 2,118,072 | 2,118,072 | |||||||||||||||||
Smithfield Foods | 26,800 | a,b | 26,800 | 407,092 | 407,092 | ||||||||||||||||
SUPERVALU | 111,300 | 111,300 | 1,414,623 | 1,414,623 | |||||||||||||||||
Tyson Foods, Cl. A | 299,700 | 20,000 | 319,700 | 3,677,319 | 245,400 | 3,922,719 | |||||||||||||||
Universal | 15,800 | a | 14,000 | a | 29,800 | 720,638 | 638,540 | 1,359,178 | |||||||||||||
31,464,042 | 3,407,230 | 1,129,190 | 35,509,812 | ||||||||||||||||||
Energy--4.7% | |||||||||||||||||||||
Bill Barrett | 27,100 | a,b | 27,100 | 843,081 | 843,081 | ||||||||||||||||
BJ Services | 46,300 | 46,300 | 861,180 | 861,180 | |||||||||||||||||
Encore Acquisition | 11,000 | b | 18,500 | b | 29,500 | 528,220 | 888,370 | 1,416,590 | |||||||||||||
Energen | 11,600 | 11,600 | 542,880 | 542,880 | |||||||||||||||||
FMC Technologies | 20,000 | a,b | 20,000 | 1,156,800 | 1,156,800 | ||||||||||||||||
Frontier Oil | 62,300 | 62,300 | 750,092 | 750,092 | |||||||||||||||||
Helix Energy Solutions Group | 14,300 | b | 14,300 | 168,025 | 168,025 | ||||||||||||||||
Mariner Energy | 150,000 | b | 150,000 | 1,741,500 | 1,741,500 | ||||||||||||||||
Murphy Oil | 53,400 | 53,400 | 2,894,280 | 2,894,280 | |||||||||||||||||
Noble | 150,000 | 150,000 | 6,105,000 | 6,105,000 | |||||||||||||||||
Plains Exploration & Production | 14,600 | b | 14,600 | 403,836 | 403,836 | ||||||||||||||||
Spectra Energy | 331,700 | 331,700 | 6,803,167 | 6,803,167 | |||||||||||||||||
Tesoro | 346,900 | a | 22,600 | a | 369,500 | 4,700,495 | 306,230 | 5,006,725 | |||||||||||||
Unit | 16,000 | b | 16,000 | 680,000 | 680,000 | ||||||||||||||||
WGL Holdings | 8,600 | a | 8,300 | 16,900 | 288,444 | 278,382 | 566,826 | ||||||||||||||
Whiting Petroleum | 80,100 | a,b | 80,100 | 5,723,145 | 5,723,145 | ||||||||||||||||
XTO Energy | 109,000 | 109,000 | 5,071,770 | 5,071,770 | |||||||||||||||||
21,798,931 | 4,860,896 | 14,075,070 | 35,663,127 | ||||||||||||||||||
Financial--15.1% | |||||||||||||||||||||
Aaron's | 20,800 | a | 20,800 | 576,784 | 576,784 | ||||||||||||||||
Alexandria Real Estate Equities | 12,900 | a,d | 12,900 | 829,341 | 829,341 | ||||||||||||||||
Allied World Assurance Holdings | 12,000 | 12,000 | 552,840 | 552,840 | |||||||||||||||||
American Financial Group | 200,800 | 48,750 | 249,550 | 5,009,960 | 1,216,313 | 6,226,273 | |||||||||||||||
AmeriCredit | 67,700 | a,b | 67,700 | 1,289,008 | 1,289,008 | ||||||||||||||||
Ameriprise Financial | 15,500 | 15,500 | 601,710 | 601,710 | |||||||||||||||||
Annaly Capital Management | 365,100 | 30,500 | 395,600 | 6,334,485 | 529,175 | 6,863,660 | |||||||||||||||
Corporate Office Properties Trust | 13,800 | 13,800 | 505,494 | 505,494 | |||||||||||||||||
Discover Financial Services | 425,138 | 425,138 | 6,253,780 | 6,253,780 | |||||||||||||||||
Endurance Specialty Holdings | 16,200 | 16,200 | 603,126 | 603,126 | |||||||||||||||||
Equity One | 18,200 | 18,200 | 294,294 | 294,294 | |||||||||||||||||
Everest Re Group | 14,300 | 50,000 | 64,300 | 1,225,224 | 4,284,000 | 5,509,224 | |||||||||||||||
Federated Investors, Cl. B | 199,600 | a | 12,000 | a | 211,600 | 5,489,000 | 330,000 | 5,819,000 | |||||||||||||
FirstMerit | 49,400 | 49,400 | 994,916 | 994,916 | |||||||||||||||||
Fortress Investment Group | 700,000 | a,b | 700,000 | 3,115,000 | 3,115,000 | ||||||||||||||||
GATX | 13,100 | a | 13,100 | 376,625 | 376,625 | ||||||||||||||||
HCC Insurance Holdings | 39,900 | 23,700 | 63,600 | 1,116,003 | 662,889 | 1,778,892 | |||||||||||||||
Hospitality Properties Trust | 105,100 | d | 55,000 | d | 160,100 | 2,491,921 | 1,304,050 | 3,795,971 | |||||||||||||
Hudson City Bancorp | 160,100 | 70,600 | 420,000 | 650,700 | 2,198,173 | 969,338 | 5,766,600 | 8,934,111 | |||||||||||||
Interactive Brokers Group, Cl. A | 130,300 | a,b | 130,300 | 2,308,916 | 2,308,916 | ||||||||||||||||
IntercontinentalExchange | 11,000 | b | 11,000 | 1,235,300 | 1,235,300 | ||||||||||||||||
International Bancshares | 12,000 | a | 12,000 | 227,160 | 227,160 | ||||||||||||||||
Invesco | 150,000 | 150,000 | 3,523,500 | 3,523,500 | |||||||||||||||||
Investment Technology Group | 228,600 | b | 228,600 | 4,503,420 | 4,503,420 | ||||||||||||||||
Liberty Property Trust | 13,700 | a,d | 13,700 | 438,537 | 438,537 | ||||||||||||||||
Macerich | 18,039 | d | 18,039 | 648,502 | 648,502 | ||||||||||||||||
Mack-Cali Realty | 4,500 | 4,500 | 155,565 | 155,565 | |||||||||||||||||
Mercury General | 3,000 | 3,000 | 117,780 | 117,780 | |||||||||||||||||
Moody's | 260,500 | a | 260,500 | 6,981,400 | 6,981,400 | ||||||||||||||||
Nasdaq OMX Group | 12,400 | b | 20,000 | b | 32,400 | 245,768 | 396,400 | 642,168 | |||||||||||||
Nationwide Health Properties | 26,000 | d | 26,000 | 914,680 | 914,680 | ||||||||||||||||
New York Community Bancorp | 31,700 | 31,700 | 459,967 | 459,967 | |||||||||||||||||
NewAlliance Bancshares | 98,800 | 98,800 | 1,186,588 | 1,186,588 | |||||||||||||||||
Old Republic International | 34,700 | 34,700 | 348,388 | 348,388 | |||||||||||||||||
PartnerRe | 65,700 | 65,700 | 4,905,162 | 4,905,162 | |||||||||||||||||
People's United Financial | 300,000 | 300,000 | 5,010,000 | 5,010,000 | |||||||||||||||||
Potlatch | 29,200 | a,d | 29,200 | 930,896 | 930,896 | ||||||||||||||||
Principal Financial Group | 19,200 | 19,200 | 461,568 | 461,568 | |||||||||||||||||
Protective Life | 235,500 | 235,500 | 3,897,525 | 3,897,525 | |||||||||||||||||
Public Storage | 32,300 | a | 32,300 | 2,630,835 | 2,630,835 | ||||||||||||||||
Raymond James Financial | 196,600 | a | 34,200 | 230,800 | 4,673,182 | 812,934 | 5,486,116 | ||||||||||||||
Regency Centers | 20,700 | a | 20,700 | 725,742 | 725,742 | ||||||||||||||||
Reinsurance Group of America | 13,500 | 13,500 | 643,275 | 643,275 | |||||||||||||||||
RenaissanceRe Holdings | 3,500 | 3,500 | 186,025 | 186,025 | |||||||||||||||||
StanCorp Financial Group | 32,400 | 32,400 | 1,296,648 | 1,296,648 | |||||||||||||||||
TD Ameritrade Holding | 220,400 | b | 220,400 | 4,271,352 | 4,271,352 | ||||||||||||||||
Transatlantic Holdings | 21,700 | 21,700 | 1,130,787 | 1,130,787 | |||||||||||||||||
UDR | 165,000 | 165,000 | 2,712,600 | 2,712,600 | |||||||||||||||||
Unitrin | 13,000 | 13,000 | 286,650 | 286,650 | |||||||||||||||||
Validus Holdings | 40,400 | 40,400 | 1,088,376 | 1,088,376 | |||||||||||||||||
Weingarten Realty Investors | 41,600 | a,d | 41,600 | 823,264 | 823,264 | ||||||||||||||||
Westamerica Bancorporation | 18,800 | a | 13,000 | a | 31,800 | 1,040,956 | 719,810 | 1,760,766 | |||||||||||||
67,249,299 | 21,269,429 | 28,340,779 | 116,859,507 | ||||||||||||||||||
Health Care--13.9% | |||||||||||||||||||||
Celgene | 12,600 | a,b | 107,000 | b | 119,600 | 786,366 | 5,957,760 | 6,744,126 | |||||||||||||
Charles River Laboratories International | 9,300 | b | 9,300 | 313,317 | 313,317 | ||||||||||||||||
Cooper | 9,400 | 9,400 | 358,328 | 358,328 | |||||||||||||||||
Edwards Lifesciences | 40,000 | b | 40,000 | 3,474,000 | 3,474,000 | ||||||||||||||||
Endo Pharmaceuticals Holdings | 125,200 | b | 45,400 | b | 170,600 | 2,567,852 | 931,154 | 3,499,006 | |||||||||||||
Express Scripts | 3,900 | b | 3,900 | 337,155 | 337,155 | ||||||||||||||||
Forest Laboratories | 145,600 | b | 145,600 | 4,675,216 | 4,675,216 | ||||||||||||||||
Gilead Sciences | 130,000 | b | 130,000 | 5,626,400 | 5,626,400 | ||||||||||||||||
Henry Schein | 24,400 | b | 24,400 | 1,283,440 | 1,283,440 | ||||||||||||||||
Hospira | 115,700 | b | 115,700 | 5,900,700 | 5,900,700 | ||||||||||||||||
Humana | 97,800 | b | 26,300 | b | 124,100 | 4,292,442 | 1,154,307 | 5,446,749 | |||||||||||||
IMS Health | 181,900 | 181,900 | 3,830,814 | 3,830,814 | |||||||||||||||||
Kinetic Concepts | 109,000 | a,b | 24,100 | a,b | 133,100 | 4,103,850 | 907,365 | 5,011,215 | |||||||||||||
Laboratory Corp. of America Holdings | 17,700 | b | 17,700 | 1,324,668 | 1,324,668 | ||||||||||||||||
Life Technologies | 151,000 | b | 151,000 | 7,886,730 | 7,886,730 | ||||||||||||||||
LifePoint Hospitals | 22,600 | a,b | 22,600 | 734,726 | 734,726 | ||||||||||||||||
Mettler-Toledo International | 53,100 | a,b | 53,100 | 5,574,969 | 5,574,969 | ||||||||||||||||
Millipore | 75,600 | b | 75,600 | 5,469,660 | 5,469,660 | ||||||||||||||||
Mylan | 107,700 | a,b | 250,000 | a,b | 357,700 | 1,984,911 | 4,607,500 | 6,592,411 | |||||||||||||
Omnicare | 238,300 | a | 31,400 | 269,700 | 5,762,094 | 759,252 | 6,521,346 | ||||||||||||||
OSI Pharmaceuticals | 30,200 | a,b | 30,200 | 937,106 | 937,106 | ||||||||||||||||
Perrigo | 94,200 | 94,200 | 3,752,928 | 3,752,928 | |||||||||||||||||
Resmed | 17,400 | b | 17,400 | 909,498 | 909,498 | ||||||||||||||||
STERIS | 32,900 | a | 32,900 | 920,213 | 920,213 | ||||||||||||||||
Techne | 22,000 | 22,000 | 1,508,320 | 1,508,320 | |||||||||||||||||
Tenet Healthcare | 352,900 | b | 352,900 | 1,902,131 | 1,902,131 | ||||||||||||||||
Universal Health Services, Cl. B | 194,400 | 22,000 | 216,400 | 5,929,200 | 671,000 | 6,600,200 | |||||||||||||||
Valeant Pharmaceuticals International | 127,600 | a,b | 36,800 | a,b | 164,400 | 4,056,404 | 1,169,872 | 5,226,276 | |||||||||||||
Vertex Pharmaceuticals | 8,000 | b | 140,000 | a,b | 148,000 | 342,800 | 5,999,000 | 6,341,800 | |||||||||||||
61,914,205 | 12,229,698 | 34,559,545 | 108,703,448 | ||||||||||||||||||
Industrial--9.2% | |||||||||||||||||||||
AGCO | 14,250 | a,b | 14,250 | 460,845 | 460,845 | ||||||||||||||||
Alliant Techsystems | 23,600 | a,b | 23,600 | 2,083,172 | 2,083,172 | ||||||||||||||||
Brink's | 32,300 | 10,100 | 42,400 | 786,182 | 245,834 | 1,032,016 | |||||||||||||||
Bucyrus International | 26,400 | 26,400 | 1,488,168 | 1,488,168 | |||||||||||||||||
Cameron International | 18,300 | b | 18,300 | 764,940 | 764,940 | ||||||||||||||||
C.H. Robinson Worldwide | 110,000 | a | 110,000 | 6,460,300 | 6,460,300 | ||||||||||||||||
Dun & Bradstreet | 4,400 | 8,000 | 12,400 | 371,228 | 674,960 | 1,046,188 | |||||||||||||||
Dycom Industries | 87,000 | b | 87,000 | 698,610 | 698,610 | ||||||||||||||||
Energizer Holdings | 3,200 | b | 3,200 | 196,096 | 196,096 | ||||||||||||||||
Fastenal | 142,000 | a | 142,000 | 5,912,880 | 5,912,880 | ||||||||||||||||
Flowserve | 4,400 | 83,000 | 87,400 | 415,932 | 7,845,990 | 8,261,922 | |||||||||||||||
Fluor | 28,000 | 6,000 | 34,000 | 1,261,120 | 270,240 | 1,531,360 | |||||||||||||||
Gentex | 29,900 | 29,900 | 533,715 | 533,715 | |||||||||||||||||
Goodrich | 56,000 | 56,000 | 3,598,000 | 3,598,000 | |||||||||||||||||
Granite Construction | 12,200 | a | 12,200 | 410,652 | 410,652 | ||||||||||||||||
Hubbell, Cl. B | 12,500 | 28,400 | 40,900 | 591,250 | 1,343,320 | 1,934,570 | |||||||||||||||
ITT | 23,500 | 23,500 | 1,168,890 | 1,168,890 | |||||||||||||||||
Jacobs Engineering Group | 13,900 | b | 100,000 | b | 113,900 | 522,779 | 3,761,000 | 4,283,779 | |||||||||||||
Joy Global | 22,500 | 22,500 | 1,160,775 | 1,160,775 | |||||||||||||||||
KBR | 17,600 | 17,600 | 334,400 | 334,400 | |||||||||||||||||
L-3 Communications Holdings | 11,500 | 11,500 | 999,925 | 999,925 | |||||||||||||||||
Landstar System | 88,000 | 88,000 | 3,411,760 | 3,411,760 | |||||||||||||||||
Oceaneering International | 16,200 | b | �� | 16,200 | 948,024 | 948,024 | |||||||||||||||
Oshkosh | 141,500 | 38,700 | 180,200 | 5,239,745 | 1,433,061 | 6,672,806 | |||||||||||||||
Patterson-UTI Energy | 16,800 | 16,800 | 257,880 | 257,880 | |||||||||||||||||
Pitney Bowes | 13,700 | 13,700 | 311,812 | 311,812 | |||||||||||||||||
R.R. Donnelley & Sons | 258,400 | 258,400 | 5,754,568 | 5,754,568 | |||||||||||||||||
SAIC | 48,800 | b | 48,800 | 924,272 | 924,272 | ||||||||||||||||
SEACOR Holdings | 8,400 | b | 8,400 | 640,500 | 640,500 | ||||||||||||||||
SPX | 91,100 | 91,100 | 4,983,170 | 4,983,170 | |||||||||||||||||
Stericycle | 10,000 | b | 10,000 | 551,700 | 551,700 | ||||||||||||||||
URS | 18,100 | b | 18,100 | 805,812 | 805,812 | ||||||||||||||||
Valmont Industries | 26,200 | a | 26,200 | 2,055,390 | 2,055,390 | ||||||||||||||||
W.W. Grainger | 30,000 | 30,000 | 2,904,900 | 2,904,900 | |||||||||||||||||
24,584,356 | 13,901,032 | 36,098,409 | 71,218,052 | ||||||||||||||||||
Information Technology--15.6% | |||||||||||||||||||||
Advent Software | 20,900 | b | 20,900 | 851,257 | 851,257 | ||||||||||||||||
Affiliated Computer Services, Cl. A | 14,600 | b | 14,600 | 871,474 | 871,474 | ||||||||||||||||
Amdocs | 70,000 | b | 70,000 | 1,997,100 | 1,997,100 | ||||||||||||||||
AU Optronics, ADR | 300,000 | a | 300,000 | 3,597,000 | 3,597,000 | ||||||||||||||||
Avnet | 31,900 | a,b | 19,400 | b | 51,300 | 962,104 | 585,104 | 1,547,208 | |||||||||||||
Broadridge Financial Solutions | 227,400 | 45,500 | 272,900 | 5,130,144 | 1,026,480 | 6,156,624 | |||||||||||||||
CA | 25,900 | 25,900 | 581,714 | 581,714 | |||||||||||||||||
Cognizant Technology Solutions, Cl. A | 12,300 | b | 12,300 | 557,190 | 557,190 | ||||||||||||||||
Computer Sciences | 20,800 | b | 9,800 | b | 30,600 | 1,196,624 | 563,794 | 1,760,418 | |||||||||||||
Convergys | 274,300 | a,b | 274,300 | 2,948,725 | 2,948,725 | ||||||||||||||||
Cree | 100,900 | b | 100,900 | 5,687,733 | 5,687,733 | ||||||||||||||||
Cypress Semiconductor | 472,600 | a,b | 110,400 | a,b | 583,000 | 4,990,656 | 1,165,824 | 6,156,480 | |||||||||||||
Diebold | 167,700 | 167,700 | 4,771,065 | 4,771,065 | |||||||||||||||||
Dolby Laboratories, Cl. A | 108,200 | a,b | 108,200 | 5,164,386 | 5,164,386 | ||||||||||||||||
DST Systems | 63,200 | b | 63,200 | 2,752,360 | 2,752,360 | ||||||||||||||||
F5 Networks | 21,200 | b | 21,200 | 1,123,176 | 1,123,176 | ||||||||||||||||
Fair Isaac | 30,300 | b | 30,300 | 645,693 | 645,693 | ||||||||||||||||
Fidelity National Information Services | 246,700 | 246,700 | 5,782,648 | 5,782,648 | |||||||||||||||||
Fiserv | 74,200 | b | 74,200 | 3,597,216 | 3,597,216 | ||||||||||||||||
FLIR Systems | 35,000 | a,b | 35,000 | 1,145,200 | 1,145,200 | ||||||||||||||||
Global Payments | 120,000 | 120,000 | 6,463,200 | 6,463,200 | |||||||||||||||||
Harris | 5,200 | 60,000 | 65,200 | 247,260 | 2,853,000 | 3,100,260 | |||||||||||||||
Informatica | 11,600 | b | 11,600 | 299,976 | 299,976 | ||||||||||||||||
Ingram Micro, Cl. A | 299,000 | b | 27,600 | b | 326,600 | 5,217,550 | 481,620 | 5,699,170 | |||||||||||||
Integrated Device Technology | 73,600 | b | 73,600 | 476,192 | 476,192 | ||||||||||||||||
Intersil, Cl. A | 40,800 | 40,800 | 625,872 | 625,872 | |||||||||||||||||
Intuit | 26,200 | a,b | 26,200 | 804,602 | 804,602 | ||||||||||||||||
Linear Technology | 130,000 | 130,000 | 3,970,200 | 3,970,200 | |||||||||||||||||
ManTech International, Cl. A | 4,500 | a,b | 4,500 | 217,260 | 217,260 | ||||||||||||||||
Microchip Technology | 190,000 | a | 190,000 | 5,521,400 | 5,521,400 | ||||||||||||||||
Micron Technology | 32,800 | b | 32,800 | 346,368 | 346,368 | ||||||||||||||||
Novell | 1,069,600 | b | 1,069,600 | 4,438,840 | 4,438,840 | ||||||||||||||||
SanDisk | 150,000 | a,b | 150,000 | 4,348,500 | 4,348,500 | ||||||||||||||||
Semtech | 10,400 | b | 10,400 | 176,904 | 176,904 | ||||||||||||||||
Sohu.com | 57,500 | a,b | 57,500 | 3,293,600 | 3,293,600 | ||||||||||||||||
Sun Microsystems | 117,600 | b | 117,600 | 1,101,912 | 1,101,912 | ||||||||||||||||
Sybase | 13,600 | a,b | 24,400 | b | 115,000 | a,b | 153,000 | 590,240 | 1,058,960 | 4,991,000 | 6,640,200 | ||||||||||
Synopsys | 68,100 | b | 68,100 | 1,517,268 | 1,517,268 | ||||||||||||||||
Tech Data | 43,300 | b | 19,000 | a,b | 62,300 | 2,020,378 | 886,540 | 2,906,918 | |||||||||||||
Teradata | 18,700 | b | 18,700 | 587,741 | 587,741 | ||||||||||||||||
ValueClick | 18,900 | b | 18,900 | 191,268 | 191,268 | ||||||||||||||||
VeriSign | 97,000 | b | 97,000 | 2,351,280 | 2,351,280 | ||||||||||||||||
Western Digital | 165,400 | b | 165,400 | 7,302,410 | 7,302,410 | ||||||||||||||||
Xilinx | 17,800 | 17,800 | 446,068 | 446,068 | |||||||||||||||||
73,661,173 | 16,017,669 | 30,843,234 | 120,522,076 | ||||||||||||||||||
Materials--9.7% | |||||||||||||||||||||
Airgas | 8,700 | 8,700 | 414,120 | 414,120 | |||||||||||||||||
Bemis | 12,560 | 12,560 | 372,404 | 372,404 | |||||||||||||||||
Cabot | 20,100 | 20,100 | 527,223 | 527,223 | |||||||||||||||||
Carlisle Cos. | 127,400 | 40,400 | 167,800 | 4,364,724 | 1,384,104 | 5,748,828 | |||||||||||||||
CF Industries Holdings | 8,100 | 8,100 | 735,318 | 735,318 | |||||||||||||||||
Commercial Metals | 282,700 | a | 282,700 | 4,424,255 | 4,424,255 | ||||||||||||||||
Crown Holdings | 162,400 | b | 15,800 | b | 168,000 | b | 346,200 | 4,154,192 | 404,164 | 4,297,440 | 8,855,796 | ||||||||||
Donaldson | 18,900 | 18,900 | 804,006 | 804,006 | |||||||||||||||||
Eastman Chemical | 99,500 | 99,500 | 5,993,880 | 5,993,880 | |||||||||||||||||
FMC | 93,000 | 93,000 | 5,185,680 | 5,185,680 | |||||||||||||||||
General Cable | 10,700 | a,b | 10,700 | 314,794 | 314,794 | ||||||||||||||||
International Paper | 209,400 | 209,400 | 5,607,732 | 5,607,732 | |||||||||||||||||
Huntsman | 47,300 | 47,300 | 534,017 | 534,017 | |||||||||||||||||
Minerals Technologies | 24,600 | 13,700 | 38,300 | 1,339,962 | 746,239 | 2,086,201 | |||||||||||||||
Nalco Holding | 171,600 | a | 171,600 | 4,377,516 | 4,377,516 | ||||||||||||||||
Pactiv | 214,400 | b | 23,100 | b | 237,500 | 5,175,616 | 557,634 | 5,733,250 | |||||||||||||
Plum Creek Timber | 32,100 | a | 32,100 | 1,212,096 | 1,212,096 | ||||||||||||||||
Reliance Steel & Aluminum | 126,800 | 27,800 | 154,600 | 5,480,296 | 1,201,516 | 6,681,812 | |||||||||||||||
Scotts Miracle-Gro, Cl. A | 16,400 | 16,400 | 644,684 | 644,684 | |||||||||||||||||
Sealed Air | 3,500 | 3,500 | 76,510 | 76,510 | |||||||||||||||||
Temple-Inland | 63,100 | 63,100 | 1,332,041 | 1,332,041 | |||||||||||||||||
Terra Industries | 11,500 | 11,500 | 370,185 | 370,185 | |||||||||||||||||
Timken | 35,300 | 35,300 | 836,963 | 836,963 | |||||||||||||||||
Titanium Metals | 50,200 | a,b | 50,200 | 628,504 | 628,504 | ||||||||||||||||
Valspar | 11,100 | 11,100 | 301,254 | 301,254 | |||||||||||||||||
Walter Energy | 91,700 | 91,700 | 6,905,927 | 6,905,927 | |||||||||||||||||
Worthington Industries | 230,900 | 72,000 | 302,900 | 3,017,863 | 941,040 | 3,958,903 | |||||||||||||||
51,898,329 | 12,536,211 | 10,229,359 | 74,663,899 | ||||||||||||||||||
Telecommunication Services--2.8% | |||||||||||||||||||||
CommScope | 60,900 | a,b | 35,700 | b | 96,600 | 1,615,677 | 947,121 | 2,562,798 | |||||||||||||
Crown Castle International | 147,000 | b | 147,000 | 5,738,880 | 5,738,880 | ||||||||||||||||
Frontier Communications | 280,000 | 280,000 | 2,186,800 | 2,186,800 | |||||||||||||||||
NeuStar, Cl. A | 13,600 | b | 13,600 | 313,344 | 313,344 | ||||||||||||||||
Qwest Communications International | 245,500 | a | 245,500 | 1,033,555 | 1,033,555 | ||||||||||||||||
RF Micro Devices | 1,119,300 | a,b | 1,119,300 | 5,339,061 | 5,339,061 | ||||||||||||||||
Telephone & Data Systems | 21,600 | 21,600 | 732,672 | 732,672 | |||||||||||||||||
US Cellular | 9,400 | b | 9,400 | 398,654 | 398,654 | ||||||||||||||||
Virgin Media | 219,500 | a | 219,500 | 3,694,185 | 3,694,185 | ||||||||||||||||
11,995,822 | 2,078,447 | 7,925,680 | 21,999,949 | ||||||||||||||||||
Transportation--0.1% | |||||||||||||||||||||
Con-way | 7,600 | 7,600 | 265,316 | 265,316 | |||||||||||||||||
Expeditors International of Washington | 13,400 | 13,400 | 465,382 | 465,382 | |||||||||||||||||
730,698 | 730,698 | ||||||||||||||||||||
Utilities--6.6% | |||||||||||||||||||||
AES | 170,000 | b | 170,000 | 2,262,700 | 2,262,700 | ||||||||||||||||
AGL Resources | 20,200 | 20,200 | 736,694 | 736,694 | |||||||||||||||||
American Water Works | 170,297 | 19,100 | 189,397 | 3,816,356 | 428,031 | 4,244,387 | |||||||||||||||
Atmos Energy | 15,900 | 15,900 | 467,460 | 467,460 | |||||||||||||||||
CMS Energy | 19,400 | a | 19,400 | 303,804 | 303,804 | ||||||||||||||||
Consolidated Edison | 82,100 | a | 82,100 | 3,729,803 | 3,729,803 | ||||||||||||||||
Covanta Holding | 16,300 | b | 16,300 | 294,867 | 294,867 | ||||||||||||||||
DPL | 168,400 | a | 168,400 | 4,647,840 | 4,647,840 | ||||||||||||||||
DTE Energy | 56,300 | 56,300 | 2,454,117 | 2,454,117 | |||||||||||||||||
IDACORP | 10,400 | a | 14,400 | 24,800 | 332,280 | 460,080 | 792,360 | ||||||||||||||
Integrys Energy | 128,500 | 128,500 | 5,395,715 | 5,395,715 | |||||||||||||||||
Northeast Utilities | 37,600 | 37,600 | 969,704 | 969,704 | |||||||||||||||||
NSTAR | 19,400 | 6,900 | 26,300 | 713,920 | 253,920 | 967,840 | |||||||||||||||
NV Energy | 397,200 | 99,600 | 496,800 | 4,917,336 | 1,233,048 | 6,150,384 | |||||||||||||||
ONEOK | 117,000 | 117,000 | 5,214,690 | 5,214,690 | |||||||||||||||||
PG & E | 63,200 | 63,200 | 2,821,880 | 2,821,880 | |||||||||||||||||
Pinnacle West Capital | 148,600 | 148,600 | 5,435,788 | 5,435,788 | |||||||||||||||||
Southern Union | 45,600 | 45,600 | 1,035,120 | 1,035,120 | |||||||||||||||||
UGI | 43,600 | 21,000 | 64,600 | 1,054,684 | 507,990 | 1,562,674 | |||||||||||||||
WESCO International | 31,700 | b | 31,700 | 856,217 | 856,217 | ||||||||||||||||
Westar Energy | 135,200 | 135,200 | 2,936,544 | 2,936,544 | |||||||||||||||||
Xcel Energy | 2,900 | 2,900 | 61,538 | 61,538 | |||||||||||||||||
39,089,038 | 6,267,708 | 7,985,380 | 51,079,426 | ||||||||||||||||||
Total Common Stocks | |||||||||||||||||||||
(cost $402,905,668, $107,515,552, $166,244,253 and $676,665,473, respectively) | 462,438,935 | 111,236,321 | 203,506,012 | 777,181,268 | |||||||||||||||||
Other Investment--1.3% | |||||||||||||||||||||
Registered Investment Company; | |||||||||||||||||||||
Dreyfus Institutional Preferred | |||||||||||||||||||||
Plus Money Market Fund | |||||||||||||||||||||
(cost $5,831,000, $1,182,000, $3,058,000 and $10,071,000, respectively) | |||||||||||||||||||||
5,831,000 | c | 1,182,000 | c | 3,058,000 | c | 10,071,000 | 5,831,000 | 1,182,000 | 3,058,000 | 10,071,000 | |||||||||||
Investment of Cash Collateral for | |||||||||||||||||||||
Securities Loaned--16.0% | |||||||||||||||||||||
Registered Investment Company; | |||||||||||||||||||||
Dreyfus Institutional Cash | |||||||||||||||||||||
Advantage Fund | 76,044,585 | c | 76,044,585 | 76,044,585 | 76,044,585 | ||||||||||||||||
Dreyfus Institutional Cash | |||||||||||||||||||||
Advantage Plus Fund | 15,717,597 | c | 32,854,928 | c | 48,572,525 | 15,717,597 | 32,854,928 | 48,572,525 | |||||||||||||
(cost $76,044,585, $15,717,597, $32,854,928 and $124,617,110, respectively) | 76,044,585 | 15,717,597 | 32,854,928 | 124,617,110 | |||||||||||||||||
Total Investments (cost $484,781,253, $124,415,149, $202,157,181 and $811,353,583, respectively) | 117.0% | 544,314,520 | 128,135,918 | 239,418,940 | 911,869,378 | ||||||||||||||||
Liabilities, Less Cash and Receivables | (17.1%) | (81,576,330) | (16,686,201) | (33,937,451) | (132,199,982) | ||||||||||||||||
Net Assets | 100.0% | 462,738,190 | 111,449,717 | 205,481,489 | 779,669,396 |
ADR - American Depository Receipts
a | Security, or portion thereof, on loan. At December 31, 2009, the total market value of securities on loan is $73,359,619, $15,341,553, $31,661,848 and $120,363,020, respectively and the total market value of the collateral held by the funds is $76,044,585, $15,717,597, $32,854,928 and $124,617,110, respectively. |
b | Non-income producing security. |
c | Investment in affiliated money market mutual fund. |
d | Investment in real estate investment trust. |
* As of 12/31/2009, all of the securities held by Dreyfus Structured Midcap Fund and Dreyfus S&P STARS Opportunities Fund comport with the investment strategies and restrictions of Dreyfus Active MidCap Fund and management does not anticipate having to dispose of any securities as a result of the merger.
See notes to unaudited pro forma financial statements.
Dreyfus Active MidCap Fund |
Pro Forma Statement of Assets and Liabilities |
December 31, 2009 (Unaudited) |
Dreyfus Active MidCap Fund | Dreyfus Structured Midcap Fund | Dreyfus S&P STARS Opportunities Fund | Adjustments | Dreyfus Active MidCap Fund Pro Forma Combined (Note 1) | ||||||||||||||||||
ASSETS ($): | Investments in securities, at value - See Statement of Investments* | |||||||||||||||||||||
Unaffiliated issuers | 462,438,935 | 111,236,321.00 | 203,506,012.00 | 777,181,268 | ||||||||||||||||||
Affiliated issuers | 81,875,585 | 16,899,597 | 35,912,928 | 134,688,110 | ||||||||||||||||||
Receivable for investment securities sold | 4,780,300 | - | - | 4,780,300 | ||||||||||||||||||
Dividends and interest receivable | 635,198 | 109,015 | 131,902 | 876,115 | ||||||||||||||||||
Receivable for shares of Common Stock subscribed | 36,324 | 116,374 | 119,193 | 271,891 | ||||||||||||||||||
Prepaid expenses | 16,125 | 15,995 | 14,279 | 46,399 | ||||||||||||||||||
Total Assets | 549,782,467 | 128,377,302 | 239,684,314 | 917,844,083 | ||||||||||||||||||
LIABILITIES ($): | Due to The Dreyfus Corporation and affiliates | 431,749 | 108,124 | 161,296 | 701,169 | |||||||||||||||||
Cash overdraft due to Custodian | 4,737,010 | 809,456 | 813,202 | 6,359,668 | ||||||||||||||||||
Liability for securities on loan | 76,044,585 | 15,717,597 | 32,854,928 | 124,617,110 | ||||||||||||||||||
Payable for shares of Common Stock redeemed | 5,480,964 | 175,923 | 104,870 | 5,761,757 | ||||||||||||||||||
Accrued expenses | 349,969 | 116,485 | 268,529 | 734,983 | ||||||||||||||||||
Total Liabilities | 87,044,277 | 16,927,585 | 34,202,825 | 138,174,687 | ||||||||||||||||||
NET ASSETS ($) | 462,738,190 | 111,449,717 | 205,481,489 | 779,669,396 | ||||||||||||||||||
REPRESENTED BY ($): | Paid-in capital | 685,186,985 | 157,341,004 | 254,766,320 | 1,097,294,309 | |||||||||||||||||
Accumulated undistributed investment income - net | 398,049 | 36,841 | 110,418 | 545,308 | ||||||||||||||||||
Accumulated net realized gain (loss) on investments | (282,380,111 | ) | (49,648,897 | ) | (86,657,008 | ) | (418,686,016 | ) | ||||||||||||||
Accumulated net unrealized appreciation (depreciation) on investments | 59,533,267 | 3,720,769 | 37,261,759 | 100,515,795 | ||||||||||||||||||
NET ASSETS ($) | 462,738,190 | 111,449,717 | 205,481,489 | 779,669,396 | ||||||||||||||||||
Dreyfus Structured Midcap Fund, Class A shares (100 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 45,338,606 | ||||||||||||||||||||
Shares outstanding | 2,997,235 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 15.13 | ||||||||||||||||||||
Maximum offering price per share (net asset value plus maximum sales charge) | $ | 16.05 | ||||||||||||||||||||
Dreyfus Structured Midcap Fund, Class B shares (100 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 2,018,065 | ||||||||||||||||||||
Shares outstanding | 141,958 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 14.22 | ||||||||||||||||||||
Dreyfus Structured Midcap Fund, Class C shares (100 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 11,655,979 | ||||||||||||||||||||
Shares outstanding | 817,489 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 14.26 | ||||||||||||||||||||
Dreyfus Structured Midcap Fund, Class I shares (100 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 52,437,067 | ||||||||||||||||||||
Shares outstanding | 3,430,019 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 15.29 | ||||||||||||||||||||
Dreyfus S&P STARS Opportunities Fund, Class A shares (unlimited number of $.001 par value shares of Beneficial Interest authorized) | ||||||||||||||||||||||
Net Assets | $ | 124,677,505 | ||||||||||||||||||||
Shares outstanding | 6,749,519 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 18.47 | ||||||||||||||||||||
Maximum offering price per share (net asset value plus maximum sales charge) | $ | 19.60 | ||||||||||||||||||||
Dreyfus S&P STARS Opportunities Fund, Class B shares (unlimited number of $.001 par value shares of Beneficial Interest authorized) | ||||||||||||||||||||||
Net Assets | $ | 6,613,826 | ||||||||||||||||||||
Shares outstanding | 377,933 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 17.50 | ||||||||||||||||||||
Dreyfus S&P STARS Opportunities Fund, Class C shares (unlimited number of $.001 par value shares of Beneficial Interest authorized) | ||||||||||||||||||||||
Net Assets | $ | 28,328,010 | ||||||||||||||||||||
Shares outstanding | 1,617,195 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 17.52 | ||||||||||||||||||||
Dreyfus S&P STARS Opportunities Fund, Class I shares (unlimited number of $.001 par value shares of Beneficial Interest authorized) | ||||||||||||||||||||||
Net Assets | $ | 45,862,148 | ||||||||||||||||||||
Shares outstanding | 2,412,898 | |||||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 19.01 | ||||||||||||||||||||
Dreyfus Active MidCap Fund, Class A Shares (35 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 445,290,042 | $ | 170,016,111 | (a) | $ | 615,306,153 | |||||||||||||||
Shares outstanding | 15,889,262 | 6,067,515 | (a) | 21,956,777 | ||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 28.02 | $ | 28.02 | ||||||||||||||||||
Maximum offering price per share (net asset value plus maximum sales charge) | $ | 29.73 | $ | 29.73 | ||||||||||||||||||
Dreyfus Active MidCap Fund, Class B Shares (30 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 4,928,774 | $ | 8,631,891 | (a) | $ | 13,560,665 | |||||||||||||||
Shares outstanding | 183,579 | 321,507 | (a) | 505,086 | ||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 26.85 | $ | 26.85 | ||||||||||||||||||
Dreyfus Active MidCap Fund, Class C Shares (15 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 8,407,308 | $ | 39,983,989 | (a) | $ | 48,391,297 | |||||||||||||||
Shares outstanding | 312,423 | 1,486,089 | (a) | 1,798,512 | ||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 26.91 | $ | 26.91 | ||||||||||||||||||
Dreyfus Active MidCap Fund, Class I Shares (15 million shares of $.001 par value Common Stock authorized) | ||||||||||||||||||||||
Net Assets | $ | 4,112,066 | $ | 98,299,215 | (a) | $ | 102,411,281 | |||||||||||||||
Shares outstanding | 145,003 | 3,466,650 | (a) | 3,611,653 | ||||||||||||||||||
Net asset value, offering price and redemption price per share | $ | 28.36 | $ | 28.36 | ||||||||||||||||||
* Investments in securities, at cost | ||||||||||||||||||||||
Unaffiliated issuers | $ | 402,905,668 | $ | 107,515,552 | $ | 166,244,253 | $ | 676,665,473 | ||||||||||||||
Affiliated issuers | $ | 81,875,585 | $ | 16,899,597 | $ | 35,912,928 | $ | 134,688,110 | ||||||||||||||
Market value of securities on loan | $ | 73,359,619 | $ | 15,341,553 | $ | 31,661,848 | $ | 120,363,020 |
(a) Adjustment to reflect the exchange of shares outstanding from Dreyfus S&P STARS Opportunities Fund and Dreyfus Structured Midcap Fund into Dreyfus Active MidCap Fund.
See notes to unaudited pro forma financial statements.
Dreyfus Active MidCap Fund |
Pro Forma Statement of Operations |
December 31, 2009 (Unaudited) |
Dreyfus Active MidCap Fund | Dreyfus Structured Midcap Fund | Dreyfus S&P STARS Opportunities Fund | Adjustments | Dreyfus Active MidCap Fund Pro Forma Combined (Note 1) | ||||||||||||||||||
INVESTMENT INCOME: | ||||||||||||||||||||||
INCOME: | Cash Dividends (net of $20,463 foreign taxes withheld on Dreyfus S&P STARS Opportunities Fund | |||||||||||||||||||||
Unaffiliated issuers | $ | 8,493,293 | $ | 2,000,351 | $ | 3,102,911 | $ | 13,596,555 | ||||||||||||||
Affiliated issuers | 3,569 | 2,431 | 9,517 | 15,517 | ||||||||||||||||||
Income from securities lending | 494,846 | 67,923 | 360,551 | 923,320 | ||||||||||||||||||
Interest Income | - | - | 4,135 | 4,135 | ||||||||||||||||||
Total Income | 8,991,708 | 2,070,705 | 3,477,114 | 14,539,527 | ||||||||||||||||||
EXPENSES: | Management fee | 3,196,911 | 776,015 | 1,540,153 | $ | 110,011 | (a) | 5,623,090 | ||||||||||||||
Shareholder servicing costs | 2,120,276 | 456,457 | 1,149,933 | (200,000 | ) | (a) | 3,526,666 | |||||||||||||||
Distribution fees | 101,969 | 100,710 | 337,793 | 540,472 | ||||||||||||||||||
Professional fees | 88,763 | 36,382 | 63,380 | (97,525 | ) | (a) | 91,000 | |||||||||||||||
Registration fees | 57,572 | 78,887 | 61,286 | (122,745 | ) | (a) | 75,000 | |||||||||||||||
Prospectus and shareholders' reports | 56,515 | - | 67,467 | (50,000 | ) | (a) | 73,982 | |||||||||||||||
Custodian fees | 45,239 | 20,392 | 19,915 | (15,500 | ) | (a) | 70,046 | |||||||||||||||
Directors'/Trustees' fees and expenses | 35,907 | 8,814 | 19,423 | (26,000 | ) | (a) | 38,144 | |||||||||||||||
Loan commitment fees | 4,029 | 637 | 530 | 5,196 | ||||||||||||||||||
Interest expense | 368 | - | 885 | 1,253 | ||||||||||||||||||
License fees | - | - | 331,173 | (331,173 | ) | (a) | - | |||||||||||||||
Miscellaneous | 44,734 | 17,123 | 28,821 | 10,000 | (a) | 100,678 | ||||||||||||||||
Total Expenses | 5,752,283 | 1,495,417 | 3,620,759 | (722,932 | ) | 10,145,527 | ||||||||||||||||
Less- reduction in management fee due to undertaking | (426,184 | ) | (521,324 | ) | 197,763 | (b) | (749,745 | ) | ||||||||||||||
Less- reduction in fees due to earnings credits | (57,548 | ) | (8,161 | ) | (19,797 | ) | (85,506 | ) | ||||||||||||||
Net Expenses | 5,268,551 | 1,487,256 | 3,079,638 | (525,169 | ) | 9,310,276 | ||||||||||||||||
INVESTMENT INCOME (LOSS) - NET | 3,723,157 | 583,449 | 397,476 | 525,169 | 5,229,251 | |||||||||||||||||
REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS: | ||||||||||||||||||||||
Net realized gain (loss) on investments: | (134,898,912 | ) | (23,504,901 | ) | (33,812,380 | ) | (192,216,193 | ) | ||||||||||||||
Net unrealized appreciation (depreciation) on investments | 257,839,035 | 50,296,884 | 75,397,634 | 383,533,553 | ||||||||||||||||||
NET REALIZED AND UNREALIZED GAIN (LOSS) ON INVESTMENTS | 122,940,123 | 26,791,983 | 41,585,254 | 191,317,360 | ||||||||||||||||||
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS | $ | 126,663,280 | $ | 27,375,432 | $ | 41,982,730 | $ | 525,169 | $ | 196,546,611 |
(a) Reflects the adjustment of expenses to be commensurate with those of the combined fund.
(b) Reflects the adjustment of management fee undertaking to be commensurate with those of the combined fund.
See notes to unaudited pro forma financial statements.
Dreyfus Active MidCap Fund
NOTES TO PRO FORMA FINANCIAL STATEMENTS (Unaudited)
NOTE 1--Basis of Combination:
At a meeting held on July 19, 2010, the Board of Directors of Strategic Funds, Inc., on behalf of Dreyfus Active MidCap Fund (the "Acquiring Fund"), and at a meeting held on June 29, 2010, the Board of Trustees of Dreyfus Manager Funds I, on behalf of Dreyfus S&P STARS Opportunities Fund, and the Board of Directors of Advantage Funds, Inc., on behalf of Dreyfus Structured Midcap Fund (Dreyfus S&P STARS Opportunities Fund and Dreyfus Structured Midcap Fund may be referred to herein individually as a "Fund" and collectively as the "Funds"), each approved an Agreement and Plan of Reorganization pursuant to which, subject to approval by shareholders of the respective Fund, the Fund will transfer all of its assets, subject to its liabilities, to the Acquiring Fund, in exchange for a number of Class A, Class B, Class C and Class I shares of the Acquiring Fund equal in value to the assets less liabilities of the respective Fund (each, an "Exchange"). The Acquiring Fund shares will then be distributed to the respective Fund's shareholders on a pro rata basis in liquidation of the Funds. Shareholders of each Fund will receive shares of the corresponding class of the Acquiring Fund in the respective Exchange.
Each Exchange will be accounted for as a tax-free merger of investment companies. The unaudited pro forma statements of investments and assets and liabilities reflect the financial position of the Acquiring Fund and the Funds on December 31, 2009. The unaudited pro forma statement of operations reflects the results of operations of the Acquiring Fund and the Funds for the twelve months ended December 31, 2009. These pro forma financial statements reflect the financial position and the results of operations assuming each Fund's shareholders approved the relevant Exchange as of January 1, 2009. Each Fund Exchange will be voted on separately by the respective Fund's shareholders and is not conditional upon shareholders approving the other Fund Exchange or on any other Exchange approvals. These pro forma financial statements have been derived from each Fund's and the Acquiring Fund's respective books and records utilized in calculating daily net asset value at the dates indicated above under accounting principles generally accepted in the United States ("GAAP"). Income, expenses (other than expenses attributable to a specific class), and realized and unrealized gains or losses on investments are allocated to each class of shares based on its relative net assets. The historical cost of investment securities will be carried forward to the surviving entity and results of operations of the Acquiring Fund for prior periods will not be restated. The fiscal year end is December 31 for the Acquiring Fund, March 31 for Dreyfus S&P STARS Opportunities Fund and August 31 for Dreyfus Structured Midcap Fund.
The pro forma statements of investments, assets and liabilities and operations should be read in conjunction with the historical financial statements of the Funds and the Acquiring Fund included or incorporated by reference in the Statement of Additional Information of which the pro forma combined financial statements form a part. The pro forma combined financial statements are presented for information only and may not necessarily be representative of what the actual combined financial statements would have been had each Exchange occurred on December 31, 2009. The pro forma financial statements were prepared in accordance with GAAP, which may require the use of management estimates and assumptions. Actual results could differ from those estimates. Following the relevant Exchange, the Acquiring Fund will be the accounting survivor.
The funds enter into contracts that contain a variety of indemnifications. The funds' maximum exposure under these arrangements is unknown. The funds do not anticipate recognizing any loss related to these arrangements.
NOTE 2--Portfolio Valuation:
Investments in securities are valued at the last sales price on the securities exchange or national securities market on which such securities are primarily traded. Securities listed on the National Market System for which market quotations are available are valued at the official closing price or, if there is no official closing price that day, at the last sales price. 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, except for open short positions, where the asked price is used for valuation purposes. Bid price is used when no asked price is available. Registered investment companies that are not traded on an exchange are valued at their net asset value. When market quotations or official closing prices are not readily available, or are determined not to reflect accurately fair value, such as when the value of a security has been significantly affected by events after the close of the exchange or market on which the security is principally traded (for example, a foreign exchange or market), but before the fund calculates its net asset value, the fund may value these investments at fair value as determined in accordance with the procedures approved by the fund's Board. Fair valuing of securities may be determined with the assistance of a pricing service using calculations based on indices of domestic securities and other appropriate indicators, such as prices of relevant ADRs and futures contracts. For other securities that are fair valued by the Board, certain factors may be considered such as: fundamental analytical data, the nature and duration of restrictions on disposition, an evaluation of the forces that influence the market in which the securities are purchased and sold and public trading in similar securities of the issuer or comparable issuers. Financial futures are valued at the last sales price.
The fair value of a financial instrument is the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date (i.e., the exit price). GAAP establishes a fair value hierarchy that prioritizes the inputs of valuation techniques used to measure fair value. This hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements).
Additionally, GAAP provides guidance on determining whether the volume and activity in a market has decreased significantly and whether such a decrease in activity results in transactions that are not orderly. GAAP requires enhanced disclosures around valuation inputs and techniques used during annual and interim periods.
Various inputs are used in determining the value of the fund's investments relating to fair value measurements. These inputs are summarized in the three broad levels listed below:
Level 1---unadjusted quoted prices in active markets for identical investments.
Level 2---other significant observable inputs (including quoted prices for similar securities, interest rates, prepayment speeds, credit risk, etc.).
Level 3---significant unobservable inputs (including the fund's own assumptions in determining the fair value of investments).
The inputs or methodology used for valuing securities are not necessarily an indication of the risk associated with investing in those securities.
All of the investments in each fund are considered Level 1.
NOTE 3--Capital Shares:
The pro forma number of shares that would be issued was calculated by dividing the net assets of each class of shares of the respective Fund on December 31, 2009 by the net asset value per share of the corresponding class of the Acquiring Fund on December 31, 2009.
NOTE 4--Pro Forma Operating Expenses:
The accompanying pro forma statement of operations reflects changes in fund expenses as if each Exchange had taken place on January 1, 2009. The Dreyfus Corporation will bear the expenses of each Exchange.
NOTE 5--Federal Income Taxes:
Each fund has qualified as a "regulated investment company" under the Internal Revenue Code. After each Exchange, the Acquiring Fund intends to continue to qualify as a regulated investment company, if such qualification is in the best interests of its shareholders, by complying with the provisions available to certain investment companies, as defined in applicable sections of the Internal Revenue Code, and to make distributions of taxable income sufficient to relieve it from all, or substantially all, federal income taxes.
The identified cost of investments for the funds is substantially the same for both financial accounting and federal income tax purposes. The tax cost of investments will remain unchanged for the combined entity.
NOTE 6—Bank Line of Credit:
The Acquiring Fund and the Funds participate with other Dreyfus-managed funds in a $225 million unsecured credit facility led by Citibank, N.A. and a $300 million unsecured credit facility provided by The Bank of New York Mellon (each, a "Facility"), each to be utilized primarily for temporary or emergency purposes, including the financing of redemptions. In connection therewith, each fund has agreed to pay its pro rata portion of commitment fees for each Facility. Interest is charged to the fund based on rates determined pursuant to the terms of the respective Facility at the time of the borrowing.
STRATEGIC FUNDS, INC.
PART C
OTHER INFORMATION
Item 15 | Indemnification. |
The response to this item is incorporated by reference to Item 25 of Part C of Post-Effective Amendment No. 62 to the Registrant's Registration Statement on Form N-1A (the "Registration Statement"), filed April 30, 2010 (File No. 2-88816). | |
Item 16 | Exhibits. |
(1)(a) | Registrant's Articles of Incorporation and Articles of Amendment are incorporated by reference to Exhibit (1) of Post-Effective Amendment No. 15 to the Registration Statement on Form N-1A, filed on April 25, 1996. |
(1)(b) | Articles of Amendment and Articles Supplementary, as amended, are incorporated by reference to Exhibit (a) of Post-Effective Amendment No. 24 to the Registration Statement on Form N-1A, filed on September 27, 2002. |
(1)(c) | Articles of Amendment are incorporated by reference to Exhibit (a)(iii) of Post-Effective Amendment No. 32 to the Registration Statement on Form N-1A, filed on May 16, 2006. |
(1)(d) | Articles Supplementary are incorporated by reference to Exhibit (a)(iv) of Post-Effective Amendment No. 32 to the Registration Statement on Form N-1A, filed on May 16, 2006. |
(1)(e) | Articles Supplementary, as revised, are incorporated by reference to Exhibit (a)(v) of Post-Effective Amendment No. 50 to the Registration Statement on Form N-1A, filed on December 16, 2008. |
(1)(f) | Articles of Amendment are incorporated by reference to Exhibit (a)(vi) of Post-Effective Amendment No. 53 to the Registration Statement on Form N-1A, filed on April 30, 2009. |
(1)(g) | Articles of Supplementary are incorporated by reference to Exhibit (a)(vii) of Post-Effective Amendment No. 56 to the Registration Statement on Form N-1A, filed on September 25, 2009. |
(2) | Registrant's By-Laws, as amended, are incorporated by reference to Exhibit (b) of Post-Effective Amendment No. 31 to the Registration Statement on Form N-1A, filed on April 26, 2006. |
(3) | Not Applicable. |
(4)(a) | Agreement and Plan of Reorganization—Dreyfus Structured Midcap Fund.* |
(4)(b) | Agreement and Plan of Reorganization—Dreyfus S&P STARS Opportunities Fund.* |
(5) | Reference is made to Exhibits (1) and (2) hereof. |
(6) | Management Agreement between the Registrant, on behalf of Dreyfus Active MidCap Fund, and The Dreyfus Corporation, as revised, is incorporated by reference to Exhibit (d)(i) of Post-Effective Amendment No. 56 to the Registration Statement on Form N-1A, filed on September 25, 2009. |
(7)(a) | Distribution Agreement with MBSC Securities Corporation, as revised, is incorporated by reference to Exhibit (e)(i) of Post-Effective Amendment No. 56 to the Registration Statement on Form N-1A, filed on September 25, 2009. |
(7)(b) | Form of Service Agreement, as amended, is incorporated by reference to Exhibit (e)(ii) of Post-Effective Amendment No. 24 to the Registration Statement on Form N-1A, filed on September 27, 2002. |
(7)(c) | Forms of Supplement to Service Agreements are incorporated by reference to Exhibit (e)(iii) of Post-Effective Amendment No. 40 to the Registration Statement on Form N-1A, filed on April 27, 2007. |
(8) | Not Applicable. |
(9)(a) | Amended and Restated Custody Agreement with Mellon Bank, N.A. is incorporated by reference to Exhibit (8)(a) of Post-Effective Amendment No. 15 to the Registration Statement on Form N-1A, filed on April 25, 1996. |
(9)(b) | Foreign Sub-Custodian Agreement is incorporated by reference to Exhibit (8)(b) of Post-Effective Amendment No. 15 to the Registration Statement on Form N-1A, filed on April 25, 1996. |
(10)(a) | Shareholder Services Plan, as revised, is incorporated by reference to Exhibit (h)(i) of Post-Effective Amendment No. 56 to the Registration Statement on Form N-1A, filed on September 25, 2009. |
(10)(b) | Rule 12b-1 Distribution Plan, as revised, is incorporated by reference to Exhibit (m) of Post-Effective Amendment No. 50 to the Registration Statement on Form N-1A, filed on December 16, 2008. |
(10)(c) | Rule 18f-3 Plan, as revised, is incorporated by reference to Exhibit (n) of Post-Effective Amendment No. 55 to the Registration Statement on Form N-1A, filed on July 24, 2009. |
(11) | Opinion and Consent of Registrant's counsel.* |
(12)(a) | Opinion and Consent of counsel regarding tax matters—Dreyfus Structured Midcap Fund.** |
(12)(b) | Opinion and Consent of counsel regarding tax matters—Dreyfus S&P STARS Opportunities Fund.** |
(13) | Not Applicable. |
(14)(a) | Consent of Independent Registered Public Accounting Firm—Dreyfus Structured Midcap Fund.* |
(14)(b) | Consent of Independent Registered Public Accounting Firm—Dreyfus S&P STARS Opportunities Fund.* |
(15) | Not Applicable. |
(16) | Power of Attorney.* |
(17)(a) | Forms of Proxy.* |
(17)(b) | The Prospectus and Statement of Additional Information of the Registrant is incorporated herein by reference to Post-Effective Amendment No. 62 (File No. 2-88816). |
________________________
* Filed herein or herewith.
** To be filed by post-effective amendment.
Item 17. | Undertakings. |
(1) | The undersigned Registrant agrees that prior to any public reoffering of the securities registered through the use of a prospectus which is a part of this registration statement by any person or party who is deemed to be an underwriter within the meaning of Rule 145(c) of the Securities Act of 1933, the reoffering prospectus will contain the information called for by the applicable registration form for reofferings by persons who may be deemed underwriters, in addition to the information called for by the other items of the applicable form. |
(2) | The undersigned Registrant agrees that every prospectus that is filed under paragraph (1) above will be filed as a part of an amendment to the registration statement and will not be used until the amendment is effective, and that, in determining any liability under the Securities Act of 1933 each post-effective amendment shall be deemed to be a new registration statement for the securities offered therein, and the offering of the securities at that time shall be deemed to be the initial bona fide offering of them. |
(3) | The undersigned Registrant agrees to file by post-effective amendment the final opinion of counsel regarding tax matters within a reasonable period of time after receiving such opinion. |
SIGNATURES
As required by the Securities Act of 1933, this Registration Statement has been signed on behalf of the Registrant, in the City of New York, and State of New York on the 27th day of July, 2010.
STRATEGIC FUNDS, INC. | ||
By: | /s/ Bradley J. Skapyak* | |
Bradley J. Skapyak, President | ||
Pursuant to the requirements of the Securities Act of 1933, the following persons in the capacities and on the dates indicated have signed this Registration Statement below.
/s/ Bradley J. Skapyak* | President (Principal Executive Officer) | July 27, 2010 | ||
Bradley J. Skapyak | ||||
/s/ James Windels* | Treasurer (Principal Financial and Accounting Officer) | July 27, 2010 | ||
James Windels | ||||
/s/ Joseph S. DiMartino* | Chairman of the Board | July 27, 2010 | ||
Joseph S. DiMartino | ||||
/s/ David W. Burke* | Board Member | July 27, 2010 | ||
David W. Burke | ||||
/s/ William Hodding Carter III* | Board Member | July 27, 2010 | ||
William Hodding Carter III | ||||
/s/ Gordon J. Davis* | Board Member | July 27, 2010 | ||
Gordon J. Davis | ||||
/s/ Joni Evans* | Board Member | July 27, 2010 | ||
Joni Evans | ||||
/s/ Ehud Houminer * | Board Member | July 27, 2010 | ||
Ehud Houminer | ||||
/s/ Richard C. Leone* | Board Member | July 27, 2010 | ||
Richard C. Leone | ||||
/s/ Hans C. Mautner * | Board Member | July 27, 2010 | ||
Hans C. Mautner | ||||
/s/ Robin A. Melvin * | Board Member | July 27, 2010 | ||
Robin A. Melvin | ||||
/s/ Burton N. Wallack * | Board Member | July 27, 2010 | ||
Burton N. Wallack | ||||
/s/ John E. Zuccotti * | Board Member | July 27, 2010 | ||
John E. Zuccotti | ||||
*By: | /s/ Jeff Prusnofsky | ||
Jeff Prusnofsky, Attorney-in-fact | |||
Exhibit Index
(11) | Opinion and Consent of Registrant's counsel. |
(14)(a) | Consent of Independent Registered Public Accounting Firm—Dreyfus Structured Midcap Fund. |
(14)(b) | Consent of Independent Registered Public Accounting Firm—Dreyfus S&P STARS Opportunities Fund. |
(16) | Power of Attorney. |