<PAGE> 1
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
File No. 2-28871
<TABLE>
<S> <C>
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 / X /
Pre-Effective Amendment No. / /
--------
Post-Effective Amendment No. 54 / X /
--------
AND
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 / X /
Amendment No. 54 / X /
------
</TABLE>
<TABLE>
<S> <C>
DELAWARE GROUP TREND FUND, INC.
- ---------------------------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
1818 Market Street, Philadelphia, Pennsylvania 19103
- ---------------------------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (215) 751-2923
--------------
George M. Chamberlain, Jr., 1818 Market Street, Philadelphia, PA 19103
- ---------------------------------------------------------------------------------------------------
(Name and Address of Agent for Service)
Approximate Date of Public Offering: November 29, 1995
-----------------
</TABLE>
It is proposed that this filing will become effective:
immediately upon filing pursuant to paragraph (b)
---------
X on November 29, 1995 pursuant to paragraph (b)
---------
60 days after filing pursuant to paragraph (a)(1)
---------
on (date) pursuant to paragraph (a)(1)
---------
75 days after filing pursuant to paragraph (a)(2)
---------
on (date) pursuant to paragraph (a)(2) of Rule 485
---------
Registrant has registered an indefinite amount of securities
under the Securities Act of 1933 pursuant to Section 24(f)
of the Investment Company Act of 1940. Registrant's 24f-2 Notice
for its most recent fiscal year was filed on August 31, 1995.
<PAGE> 2
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
--- C O N T E N T S ---
This Post-Effective Amendment No. 54 to Registration File No. 2-28871
includes the following:
1. Facing Page
2. Contents Page
3. Cross-Reference Sheet
4. Part A - Prospectuses and Supplement*
5. Part B - Statement of Additional Information
6. Part C - Other Information
7. Signatures
* The Registrant's Institutional Class Prospectus dated October
31, 1995 is incorporated into this filing by reference to the
electronic filing of that Prospectus made pursuant to Rule
497(c) on November 6, 1995.
<PAGE> 3
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
CROSS-REFERENCE SHEET*
PART A**
<TABLE>
<CAPTION>
Location in
Item No. Description Prospectuses
-------- ----------- ------------
<S> <C> <C> <C>
A Class/ Institutional
B Class/ Class
C Class
1 Cover Page . . . . . . . . . . . . . . . . . . . . . . . . Cover Cover
2 Synopsis . . . . . . . . . . . . . . . . . . . . . . . . . Synopsis, Synopsis,
Summary Summary
of Expenses of Expenses
3 Condensed Financial Information . . . . . . . . . . . . . . Financial Financial
Highlights Highlights
4 General Description of Registrant . . . . . . . . . . . . Investment Investment
Objective Objective
and Policies, and Policies,
Shares Shares
5 Management of the Fund . . . . . . . . . . . . . . . . . . Management of Management of
the Fund the Fund
6 Capital Stock and Other Securities . . . . . . . . . . . . Delaware Dividends and
Difference, Distributions,
Dividends and Taxes, Shares
Distributions,
Taxes, Shares
7 Purchase of Securities Being Offered . . . . . . . . . . . Cover, Cover,
Buying Shares, Buying Shares,
Calculation of Calculation of
Offering Price Net Asset
and Net Asset Value Per Share,
Value Per Share, Management of
Management of the Fund
the Fund
8 Redemption or Repurchase . . . . . . . . . . . . . . . . . Redemption and Redemption and
Exchange Exchange
9 Pending Legal Proceedings . . . . . . . . . . . . . . . . . None None
</TABLE>
* This filing relates to Registrant's Trend Fund A Class, Trend Fund
B Class and Trend Fund C Class, which are combined in one
prospectus, and Trend Fund Institutional Class, which has its own
prospectus. The four classes have a common Part B and Part C.
** The Registrant's Institutional Class Prospectus dated October 31,
1995 is incorporated into this filing by reference to the
electronic filing of that Prospectus made pursuant to Rule 497(c)
on November 6, 1995.
<PAGE> 4
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
CROSS-REFERENCE SHEET
PART B
<TABLE>
<CAPTION>
Location in Statement
Item No. Description of Additional Information
-------- ----------- -------------------------
<S> <C> <C>
10 Cover Page . . . . . . . . . . . . . . . . . . . . . . . . Cover
11 Table of Contents . . . . . . . . . . . . . . . . . . . . . Table of Contents
12 General Information and History . . . . . . . . . . . . . . General Information
13 Investment Objectives and Policies . . . . . . . . . . . . Investment Objective
and Policies
14 Management of the Registrant . . . . . . . . . . . . . . . Officers and Directors
15 Control Persons and Principal Holders of Securities . . . . Officers and Directors
16 Investment Advisory and Other Services . . . . . . . . . . Plans Under Rule 12b-1 for
the Fund Classes (under
Purchasing Shares),
Investment Management
Agreement, Officers and
Directors, General
Information, Financial
Statements
17 Brokerage Allocation . . . . . . . . . . . . . . . . . . . Trading Practices
and Brokerage
18 Capital Stock and Other Securities . . . . . . . . . . . . Capitalization and
Noncumulative Voting
(under General
Information)
19 Purchase, Redemption and Pricing of Securities
Being Offered . . . . . . . . . . . . . . . . . . . . . . . Purchasing Shares,
Determining Offering
Price and Net Asset Value,
Redemption and
Repurchase, Exchange
Privilege
20 Tax Status . . . . . . . . . . . . . . . . . . . . . . . . Taxes
21 Underwriters . . . . . . . . . . . . . . . . . . . . . . . Purchasing Shares
22 Calculation of Performance Data . . . . . . . . . . . . . . Performance Information
23 Financial Statements . . . . . . . . . . . . . . . . . . . Financial Statements
</TABLE>
<PAGE> 5
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
CROSS-REFERENCE SHEET
PART C
<TABLE>
<CAPTION>
Location in
Part C
-------
<S> <C> <C>
24 Financial Statements and Exhibits . . . . . . . . . . . . . . . . . Item 24
25 Persons Controlled by or under Common
Control with Registrant . . . . . . . . . . . . . . . . . . . . . . Item 25
26 Number of Holders of Securities . . . . . . . . . . . . . . . . . . Item 26
27 Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . Item 27
28 Business and Other Connections of Investment Adviser . . . . . . . Item 28
29 Principal Underwriters . . . . . . . . . . . . . . . . . . . . . . Item 29
30 Location of Accounts and Records . . . . . . . . . . . . . . . . . Item 30
31 Management Services . . . . . . . . . . . . . . . . . . . . . . . . Item 31
32 Undertakings . . . . . . . . . . . . . . . . . . . . . . . . . . . Item 32
</TABLE>
<PAGE> 6
(DTF-ABC)
TREND FUND
A CLASS SHARES PROSPECTUS
B CLASS SHARES NOVEMBER 29, 1995
C CLASS SHARES
-----------------------------------------------------------------------
1818 MARKET STREET, PHILADELPHIA, PA 19103
FOR PROSPECTUS AND PERFORMANCE: NATIONWIDE 800-523-4640, PHILADELPHIA
215-988-1333
INFORMATION ON EXISTING ACCOUNTS: (SHAREHOLDERS ONLY)
NATIONWIDE 800-523-1918, PHILADELPHIA 215-988-1241
DEALER SERVICES: (BROKER/DEALERS ONLY)
NATIONWIDE 800-362-7500, PHILADELPHIA 215-988-1050
This Prospectus describes the Trend Fund A Class of shares (the "Class
A Shares"), the Trend Fund B Class of shares (the "Class B Shares") and the
Trend Fund C Class of shares (the "Class C Shares") (individually, the "Class"
and collectively, the "Classes") of Delaware Group Trend Fund, Inc. (the
"Fund"), a professionally-managed mutual fund. The Fund's objective is to
achieve capital appreciation by investing primarily in securities of emerging
and other growth-oriented companies.
Class A Shares may be purchased at the public offering price, which is
equal to the next determined net asset value per share, plus a front-end sales
charge. Class B Shares and Class C Shares may be purchased at a price equal to
the next determined net asset value per share. Class A Shares are subject to a
maximum front-end sales charge of 4.75% and annual 12b-1 Plan expenses of up to
0.30%. Class B Shares are subject to a contingent deferred sales charge
("CDSC") which may be imposed on redemptions made within six years of purchase
and annual 12b-1 Plan expenses of 1.00% which are assessed against the Class B
Shares for approximately eight years after purchase. See Automatic Conversion
of Class B Shares under Buying Shares. Class C Shares are subject to a CDSC
which may be imposed on redemptions made within twelve months of purchase and
annual 12b-1 Plan expenses of 1.00%, which are assessed against the Class C
Shares for the life of the investment. See Summary of Expenses. These
alternatives permit an investor to choose the method of purchasing shares that
is most suitable for his or her needs. In choosing the most suitable Class, an
investor should consider the differences among the three Classes, including the
effect of sales charges and 12b-1 Plan expenses, given the amount of the
purchase, the length of time the investor expects to hold the shares and other
circumstances. See Buying Shares.
This Prospectus relates only to the Classes listed above and sets
forth information that you should read and consider before you invest. Please
retain it for future reference. Part B of the Fund's registration statement,
dated November 29, 1995, as it may be amended from time to time, contains
additional information about the Fund and has been filed with the Securities
and Exchange Commission. Part B is incorporated by reference into this
Prospectus and is available, without charge, by writing to Delaware
Distributors, L.P. at the above address or by calling the above numbers. The
Fund's financial statements appear in its Annual Report for the fiscal year
ended June 30, 1995; which will accompany any response to requests for Part B.
The Fund also offers the Trend Fund Institutional Class. That class
is available for purchase only by certain investors. A prospectus for the
Trend Fund Institutional Class can be obtained by writing to Delaware
Distributors, L.P. at the above address or by calling the above number.
-1-
<PAGE> 7
(DTF-ABC)
<TABLE>
<CAPTION>
TABLE OF CONTENTS
<S> <C>
COVER PAGE RETIREMENT PLANNING
SYNOPSIS BUYING SHARES
SUMMARY OF EXPENSES REDEMPTION AND EXCHANGE
FINANCIAL HIGHLIGHTS DIVIDENDS AND DISTRIBUTIONS
INVESTMENT OBJECTIVE AND POLICIES TAXES
INVESTMENT STRATEGY CALCULATION OF OFFERING PRICE AND
SUITABILITY NET ASSET VALUE PER SHARE
THE DELAWARE DIFFERENCE MANAGEMENT OF THE FUND
PLANS AND SERVICES APPENDIX A - INVESTMENT ILLUSTRATIONS
</TABLE>
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
BE SURE TO CONSULT YOUR FINANCIAL ADVISER WHEN MAKING INVESTMENTS. MUTUAL
FUNDS CAN BE A VALUABLE PART OF YOUR FINANCIAL PLAN; HOWEVER, SHARES OF THE
FUND ARE NOT FDIC OR NCUSIF INSURED, ARE NOT GUARANTEED BY ANY BANK OR ANY
CREDIT UNION, ARE NOT OBLIGATIONS OF ANY BANK OR ANY CREDIT UNION, AND INVOLVE
INVESTMENT RISK, INCLUDING THE POSSIBLE LOSS OF PRINCIPAL. SHARES OF THE FUND
ARE NOT BANK OR CREDIT UNION DEPOSITS.
-2-
<PAGE> 8
(DTF-ABC)
SYNOPSIS
CAPITALIZATION
Trend Fund offers four classes of shares: Class A Shares, Class B
Shares, Class C Shares and the Trend Fund Institutional Class. The Fund has a
present authorized capitalization of five hundred million shares of capital
stock with a $.50 par value per share. Fifty million shares of that stock have
been allocated to the Class A Shares, twenty-five million shares have been
allocated to the Class B Shares, twenty-five million shares have been allocated
to the Class C Shares and twenty-five million shares have been allocated to the
Trend Fund Institutional Class. See Shares under Management of the Fund.
INVESTMENT MANAGER, DISTRIBUTOR AND SERVICE AGENT
Delaware Management Company, Inc. (the "Manager") is the investment
manager for the Fund. The Manager or its affiliate, Delaware International
Advisers Ltd., also manages the other funds in the Delaware Group. Delaware
Distributors, L.P. (the "Distributor") is the national distributor for the Fund
and for all of the other mutual funds in the Delaware Group. Delaware Service
Company, Inc. (the "Transfer Agent") is the shareholder servicing, dividend
disbursing and transfer agent for the Fund and for all of the other mutual
funds in the Delaware Group. See Management of the Fund.
SALES CHARGES
The price of the Class A Shares includes a maximum front-end sales
charge of 4.75% of the offering price, which, based on the net asset value per
share of the Class A Shares as of the end of the Fund's most recent fiscal
year, is equivalent to 5.00% of the amount invested. The sales charge is
reduced on certain transactions of at least $100,000 but under $1,000,000. For
purchases of $1,000,000 or more, the front-end sales charge is eliminated.
Class A Shares are subject to annual 12b-1 Plan expenses.
The price of the Class B Shares is equal to the net asset value per
share. Class B Shares are subject to a CDSC of: (i) 4% if shares are redeemed
within two years of purchase; (ii) 3% if shares are redeemed during the third
or fourth year following purchase; (iii) 2% if shares are redeemed during the
fifth year following purchase; and (iv) 1% if shares are redeemed during the
sixth year following purchase. Class B Shares are subject to annual 12b-1 Plan
expenses for approximately eight years after purchase. See Automatic
Conversion of Class B Shares under Buying Shares.
The price of the Class C Shares is equal to the net asset value per
share. Class C Shares are subject to a CDSC of 1% if shares are redeemed
within twelve months of purchase. Class C Shares are subject to annual 12b-1
Plan expenses for the life of the investment.
See Buying Shares and Distribution (12b-1) and Service under
Management of the Fund.
PURCHASE AMOUNTS
Generally, the minimum initial investment is $1,000 for Class A
Shares, Class B Shares and Class C Shares. Subsequent investments in any Class
generally must be at least $100. Each purchase of Class B Shares is subject to
a maximum purchase limitation of $250,000. For Class C Shares, each purchase
must be in an amount that is less than $1,000,000. An investor may exceed
these maximum purchase limitations for Class B Shares and Class C Shares by
making cumulative purchases over a period of time. An investor should keep in
mind, however, that reduced front-end sales charges apply to investments of
$100,000 or more of Class A Shares, which are subject to lower annual 12b-1
Plan expenses than Class B Shares and Class C Shares and generally are not
subject to a CDSC. The minimum and maximum purchase amounts for retirement
plans may vary. See Buying Shares.
INVESTMENT OBJECTIVE
The objective of the Fund is to seek to achieve capital appreciation
by investing primarily in securities of emerging and other growth-oriented
companies. For further details, see Investment Objective and Policies.
OPEN-END INVESTMENT COMPANY
-3-
<PAGE> 9
(DTF-ABC)
The Fund, which was organized as a Maryland corporation in 1983, is an
open-end management investment company and its portfolio of assets is
diversified as defined by the Investment Company Act of 1940 (the "1940 Act").
Previously, the Fund was a Delaware corporation organized in 1966. See Shares
under Management of the Fund.
INVESTMENT MANAGEMENT FEES
The Manager furnishes investment management services to the Fund,
subject to the supervision and direction of the Board of Directors. Under the
Investment Management Agreement, the annual compensation paid to the Manager is
equal to 3/4 of 1% of the average daily net assets, less a proportionate share
of all directors' fees paid to the unaffiliated directors by the Fund. See
Management of the Fund.
REDEMPTION AND EXCHANGE
Class A Shares of the Fund may be redeemed or exchanged at the net
asset value calculated after receipt of the redemption or exchange request.
Neither the Fund nor the Distributor assesses a charge for redemptions or
exchanges of Class A Shares, except for certain redemptions of shares purchased
at net asset value, which may be subject to a CDSC if such purchases triggered
the payment of a dealer's commission. See Front-End Sales Charge Alternative -
Class A Shares under Buying Shares and Contingent Deferred Sales Charge for
Certain Purchases of Class A Shares Made at Net Asset Value under Redemption
and Exchange. Class B and Class C Shares may be redeemed or exchanged at the
net asset value calculated after receipt of the redemption or exchange request
subject, in the case of redemptions, to any applicable CDSC. Neither the Fund
nor the Distributor assesses any charges other than the CDSC for redemptions or
exchanges of Class B or Class C Shares. There are certain limitations on an
investor's ability to exchange shares between the various classes of shares
that are offered. See Redemption and Exchange.
-4-
<PAGE> 10
(DTF-ABC)
SUMMARY OF EXPENSES
A general comparison of the sales arrangements and other expenses
applicable to Class A, Class B and Class C Shares follows:
<TABLE>
<CAPTION>
CLASS A CLASS B CLASS C
SHAREHOLDER TRANSACTION EXPENSES SHARES SHARES SHARES
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price) . . . . 4.75% None None
Maximum Sales Charge Imposed on Reinvested
Dividends (as a percentage of offering
price) . . . . . . . . . . . . . . . . . . None None None
Maximum Contingent Deferred Sales Charge
(as a percentage of original purchase price
or redemption proceeds, whichever is lower) None* 4.00%* 1.00%*
Redemption Fees . . . . . . . . . . . . . . None** None** None**
</TABLE>
<TABLE>
<CAPTION>
ANNUAL OPERATING EXPENSES (AS A CLASS A CLASS B CLASS C
PERCENTAGE OF AVERAGE DAILY NET ASSETS) SHARES SHARE*** SHARES
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Management Fees . . . . . . . . . . . . . . 0.75% 0.75% 0.75%
12b-1 Expenses (including service fees) . . 0.24%+/++ 1.00%++ 1.00%++
Other Operating Expenses . . . . . . . . . 0.37% 0.37% 0.37%+++
----- ----- --------
Total Operating Expenses . . . . . . . . . 1.36%+ 2.12% 2.12%
===== ===== =====
</TABLE>
The purpose of this table is to assist the investor in understanding the
various costs and expenses that an investor in any of the Classes will bear
directly or indirectly.
*With respect to Class A Shares, purchases of $1 million or more may be
made at net asset value; however, if in connection with any such purchase
certain dealer commissions are paid to the financial adviser through whom such
purchase is effected, a CDSC of 1% will be imposed on certain redemptions
within twelve months of purchase ("Limited CDSC"). Class B Shares are subject
to a CDSC of: (i) 4% if shares are redeemed within two years of purchase; (ii)
3% if shares are redeemed during the third or fourth year following purchase;
(iii) 2% if shares are redeemed during the fifth year following purchase; (iv)
1% if shares are redeemed during the sixth year following purchase; and (v) 0%
thereafter. Class C Shares are subject to a CDSC of 1% if the shares are
redeemed within twelve months of purchase. See Contingent Deferred Sales
Charge for Certain Purchases of Class A Shares Made at Net Asset Value under
Redemption and Exchange and Deferred Sales Charge Alternative - Class B Shares
and Level Sales Charge Alternative - Class C Shares under Buying Shares.
**CoreStates Bank, N.A. currently charges $7.50 per redemption for
redemptions payable by wire.
***"Annual Operating Expenses" for Class B Shares are based on the
actual expenses incurred by the Class during the period September 6, 1994
through June 30, 1995, and have been annualized.
+The actual 12b-1 Plan expenses to be paid and, consequently, the Total
Operating Expenses of the Class A Shares, may be somewhat more (but the 12b-1
Plan expenses may be no more than .30%) or somewhat less (but the 12b-1 Plan
expenses may be no less than .10%) because of the formula adopted by
-5-
<PAGE> 11
(DTF-ABC)
the Board of Directors for use in calculating the 12b-1 Plan expenses beginning
June 1, 1992. See Distribution (12b-1) and Service under Management of the
Fund.
++Class A Shares, Class B Shares and Class C Shares are subject to
separate 12b-1 Plans. Long-term shareholders may pay more than the economic
equivalent of the maximum front-end sales charges permitted by rules of the
National Association of Securities Dealers, Inc. (the "NASD"). See
Distribution (12b-1) and Service under Management of the Fund.
+++ "Other Operating Expenses" for Class C Shares are estimates based on
the actual expenses incurred by the Class A Shares for the fiscal year ended
June 30, 1995. See Trend Fund Institutional Class for expense information for
that class.
The following example illustrates the expenses that an investor would
pay on a $1,000 investment over various time periods, assuming (1) a 5% annual
rate of return, (2) redemption at the end of each time period and (3) with
respect to Class B Shares and Class C Shares, payment of a CDSC at the time of
redemption, if applicable.
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Class A Shares $61(1) $89 $118 $203
Class B Shares 62 96 134 226(2)
Class C Shares 32 66 114 245
</TABLE>
An investor would pay the following expenses on the same $1,000
investment, assuming no redemption at the end of the period:
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Class A Shares $61 $89 $118 $203
Class B Shares 22 66 114 226(2)
Class C Shares 22 66 114 245
</TABLE>
(1) Generally, the Fund does not assess a redemption charge upon
redemption of Class A Shares. Under certain circumstances,
however, a Limited CDSC, which has not been reflected in this
calculation, may be imposed on certain redemptions within twelve
months of purchase. See Contingent Deferred Sales Charge for
Certain Purchases of Class A Shares Made at Net Asset Value under
Redemption and Exchange.
(2) At the end of approximately eight years after purchase, Class B
Shares will be automatically converted into Class A Shares. The
example above assumes conversion of Class B Shares at the end of
the eighth year. However, the conversion may occur as late as
three months after the eighth anniversary of purchase, during which
time the higher 12b-1 Plan fees payable by Class B Shares will
continue to be assessed. Information for the ninth and tenth years
reflects expenses of Class A Shares. See Automatic Conversion of
Class B Shares under Buying Shares for a description of the
automatic conversion feature.
THIS EXAMPLE SHOULD NOT BE CONSIDERED A REPRESENTATION OF PAST OR FUTURE
EXPENSES OR PERFORMANCE. ACTUAL EXPENSES MAY BE GREATER OR LESS THAN THOSE
SHOWN.
-6-
<PAGE> 12
(DTF-ABC)
- --------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
The following financial highlights are derived from the financial statements of
Delaware Group Trend Fund, Inc. and have been audited by Ernst & Young LLP,
independent auditors. The data should be read in conjunction with the
financial statements, related notes, and the report of Ernst & Young LLP
covering such financial information and highlights, all of which are
incorporated by reference into Part B. Further information about the Fund's
performance is contained in its Annual Report to shareholders for the fiscal
year ended June 30, 1995. A copy of the Fund's Annual Report (including the
report of Ernst & Young LLP) may be obtained from the Fund upon request at no
charge. Information regarding Class C Shares has not been included in these
tables because such shares were not offered to the public prior to the date of
this Prospectus.
- --------------------------------------------------------------------------------
-7-
<PAGE> 13
DTF-A-CHT
<TABLE>
<CAPTION>
CLASS A SHARES
------------------------------------------------------------------------
YEAR ENDED
6/30/95(1) 6/30/94(1) 6/30/93(1) 6/30/92(1) 6/30/91
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period . . . . . $12.210 $13.980 $11.380 $8.920 $9.970
INCOME FROM INVESTMENT OPERATIONS
- ---------------------------------
Net Investment Income (Loss)(3) . . . . . . . . (0.074) (0.042) (0.004) (0.005) (0.020)
Net Gains or Losses on Securities
(both realized and unrealized) . . . . . 2.864 0.212 3.754 2.625 (0.460)
----- ----- ----- ----- -------
Total From Investment Operations . . . . 2.790 0.170 3.750 2.620 (0.480)
----- ----- ----- ----- -------
LESS DISTRIBUTIONS
- ------------------
Dividends (from net investment
income) . . . . . . . . . . . . . . . . . . . none none none none (0.050)
Distributions (from capital
gains) . . . . . . . . . . . . . . . . . . . (0.790) (1.940) (1.150) (0.160) (0.520)
Returns of Capital . . . . . . . . . . . . . . none none none none none
---- ---- ---- ---- ----
Total Distributions . . . . . . . . . . (0.790) (1.940) (1.150) (0.160) (0.570)
------- ------- ------- ------- -------
Net Asset Value, End of Period . . . . . . . . $14.210 $12.210 $13.980 $11.380 $8.920
======= ======= ======= ======= ======
- ----------------------------------------------------------------------------------------
TOTAL RETURN(4) . . . . . . . . . . . . . . . . 24.40% 0.59% 35.24% 29.31% (4.82%)
- ------------
- ---------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------
Net Assets, End of Period
(000's omitted) . . . . . . . . . . . . . . . $318,933 $253,964 $219,826 $124,548 $78,631
Ratio of Expenses to Average
Daily Net Assets . . . . . . . . . . . . . . 1.36% 1.37% 1.33% 1.18% 1.29%
Ratio of Net Investment Income
to Average Daily Net Assets . . . . . . . . . (0.58%) (0.72%) (0.61%) (0.43%) (0.24%)
Portfolio Turnover Rate . . . . . . . . . . . . 64% 67% 75% 76% 67%
</TABLE>
<TABLE>
<CAPTION>
CLASS A SHARES
----------------------------------------------------------------------
YEAR ENDED
6/30/90 6/30/89 6/30/88 6/30/87 6/30/86(2)
<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period . . . . . $10.870 $8.130 $9.120 $8.910 $6.430
INCOME FROM INVESTMENT OPERATIONS
- ---------------------------------
Net Investment Income (Loss)(3) . . . . . . . . 0.146 0.018 (0.066) (0.082) (0.042)
Net Gains or Losses on Securities
(both realized and unrealized) . . . . . 1.224 3.042 (0.924) 0.292 2.650
----- ----- ------- ----- -----
Total From Investment Operations . . . . 1.370 3.060 (0.990) 0.210 2.608
----- ----- ------- ----- -----
LESS DISTRIBUTIONS
- ------------------
Dividends (from net investment
income) . . . . . . . . . . . . . . . . . . . (0.050) none none none (0.128)
Distributions (from capital
gains) . . . . . . . . . . . . . . . . . . . (2.220) (0.320) none none none
Returns of Capital . . . . . . . . . . . . . . none none none none none
---- ---- ---- ---- ----
Total Distributions . . . . . . . . . . (2.270) (0.320) none none (0.128)
------- ------- ---- ---- -------
Net Asset Value, End of Period . . . . . . . . $9.970 $10.870 $8.130 $9.120 $8.910
====== ======= ====== ====== ======
- ----------------------------------------------------------------------------------------
TOTAL RETURN(4) . . . . . . . . . . . . . . . . 14.32% 39.27% (10.86%) 2.36% 41.37%
- ------------
- ---------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------
Net Assets, End of Period
(000's omitted) . . . . . . . . . . . . . . . $88,274 $67,111 $59,879 $79,266 $109,884
Ratio of Expenses to Average
Daily Net Assets . . . . . . . . . . . . . . 1.27% 1.28% 1.20% 1.18% 1.20%
Ratio of Net Investment Income
to Average Daily Net Assets . . . . . . . . . 0.82% 0.19% (0.51%) (0.64%) (0.57%)
Portfolio Turnover Rate . . . . . . . . . . . . 80% 48% 63% 93% 113%
</TABLE>
- ------------------------
(1) Reflects 12b-1 distribution expenses beginning June 1, 1992.
(2) All figures prior to May 9, 1986 are adjusted for a 2-for-1 stock split
paid on that date.
(3) 1995 per share information was based on the average shares outstanding
method.
(4) Does not reflect maximum sales charge that is or was in effect nor the
Limited CDSC that would apply in the event of certain redemptions within twelve
months of purchase. See Contingent Deferred Sales Charge for Certain Purchases
of Class A Shares Made at Net Asset Value under Redemption and Exchange.
<PAGE> 14
DTF-B-CHT
<TABLE>
<CAPTION>
CLASS B SHARES
--------------
PERIOD
9/6/94(1)
THROUGH
6/30/95
<S> <C>
Net Asset Value, Beginning of Period . . . . . . . . . . . . . . . $12.110
INCOME FROM INVESTMENT OPERATIONS
- ---------------------------------
Net Investment Loss(2) . . . . . . . . . . . . . . . . . . . . . . (0.142)
Net Gains or Losses on Securities
(both realized and unrealized) . . . . . . . . . . . 2.162
-----
Total From Investment Operations . . . . . . . . . . . . . 2.020
-----
LESS DISTRIBUTIONS
- ------------------
Dividends (from net investment income) . . . . . . . . . . . . . . none
Distributions (from capital gains) . . . . . . . . . . . . . . . . none
Returns of Capital . . . . . . . . . . . . . . . . . . . . . . . . none
Total Distributions . . . . . . . . . . . . . . . . . . . none
----
Net Asset Value, End of Period . . . . . . . . . . . . . . . . . . $14.130
=======
- ----------------------------------------------------------------------------------------
TOTAL RETURN(3) . . . . . . . . . . . . . . . . . . . . . . . . . . 16.68%(1)
- ------------
- ---------------------------------------------------------------
RATIOS/SUPPLEMENTAL DATA
- ------------------------
Net Assets, End of Period (000's omitted) . . . . . . . . . . . . . $5,175
Ratio of Expenses to Average Daily Net Assets . . . . . . . . . . . 2.12%(1)
Ratio of Net Investment Income to Average Daily Net Assets . . . . (1.34%)(1)
Portfolio Turnover Rate . . . . . . . . . . . . . . . . . . . . . . 64%
</TABLE>
- -----------------------
(1) Date of initial public offering; ratios have been annualized but total
return for the limited period between September 6, 1994 and June 30, 1995 has
not been annualized.
(2) 1995 per share information was based on the average shares outstanding
method.
(3) Does not reflect the CDSC which varies from 1%-4% depending upon the
holding period.
<PAGE> 15
(DTF-ABC)
INVESTMENT OBJECTIVE AND POLICIES
INVESTMENT STRATEGY
The objective of the Fund is long-term capital appreciation. The Fund's
strategy is to invest primarily in the common stocks and securities convertible
into common stocks of emerging and other growth-oriented companies which, in
the opinion of the Manager, are responsive to changes within the marketplace
and have the fundamental characteristics to support growth.
The Fund will seek to identify changing and dominant trends within the
economy, the political arena and our society. The Fund will purchase
securities which it believes will benefit from these trends and which have the
fundamentals to exploit them. The fundamentals include managerial skills,
product development and sales and earnings.
In investing for capital appreciation, the Fund may hold securities for
any period of time. The Fund may also invest in foreign securities.
The Fund may purchase privately placed securities the resale of which is
restricted under applicable securities laws. Such securities may offer a
higher return than comparably registered securities but involve some additional
risk as they can be resold only in privately negotiated transactions, in
accordance with an exemption from the registration requirements under
applicable securities laws or after registration. The Fund will not purchase
illiquid assets, including such restricted securities, if more than 10% of the
value of its assets would then consist of illiquid securities.
Certain of the privately placed securities acquired by the Fund will be
eligible for resale by the Fund pursuant to Rule 144A under the Securities Act
of 1933 ("Rule 144A Securities"). Rule 144A permits many privately placed or
legally restricted securities to be freely traded without restriction among
certain institutional buyers such as the Fund.
While maintaining oversight, the Board of Directors of the Fund has
delegated to the Manager the day-to-day function of determining whether or not
individual Rule 144A Securities are liquid for purposes of the Fund's 10%
limitation on investments in illiquid securities. The Board has instructed the
Manager to consider the following factors in determining the liquidity of a
Rule 144A Security: (i) the frequency of trades and trading volume for the
security; (ii) whether at least three dealers are willing to purchase or sell
the security and the number of potential purchasers; (iii) whether at least two
dealers are making a market in the security; and (iv) the nature of the
security and the nature of the marketplace trades (e.g., the time needed to
dispose of the security, the method of soliciting offers, and the mechanics of
transfer). If the Manager determines that a Rule 144A Security which was
previously determined to be liquid is no longer liquid and, as a result, the
Fund's holdings of illiquid securities exceed the Fund's 10% limit on
investments in such securities, the Manager will determine what action to take
to ensure that the Fund continues to adhere to such limitation.
Income is not an objective of the Fund. However, should the market
warrant a temporary defensive approach, the Fund may also invest in cash
equivalents, and fixed income obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities, as well as corporate bonds.
The Fund may invest in repurchase agreements, but will not normally do
so except to invest excess cash balances. In a repurchase agreement, the Fund
purchases a security and simultaneously agrees to sell it back to the seller at
a set (generally higher) price. Delays or losses could result if the other
party to the repurchase agreement defaults or becomes insolvent.
While the Fund is permitted under certain circumstances to borrow money,
it does not normally do so. The Fund will not purchase securities while any
borrowings are outstanding.
Although the Fund will constantly strive to attain the objective of
long-term capital growth, there can be no assurance that it will be attained.
The objective of the Fund may not be changed without shareholder approval.
Part B provides more information on the Fund's investment policies and
restrictions.
PORTFOLIO LOAN TRANSACTIONS
The Fund may loan up to 25% of its assets to qualified broker/dealers or
institutional investors for their use relating to short sales or other security
transactions.
The major risk to which the Fund would be exposed on a loan transaction
is the risk that
-10-
<PAGE> 16
(DTF-ABC)
the borrower would go bankrupt at a time when the value of the security goes
up. Therefore, the Fund will only enter into loan arrangements after a review
of all pertinent facts by the Manager, subject to overall supervision by the
Board of Directors, including the creditworthiness of the borrowing broker,
dealer or institution and then only if the consideration to be received from
such loans would justify the risk. Creditworthiness will be monitored on an
ongoing basis by the Manager.
SUITABILITY
The Fund may be suitable for investors interested in long-term capital
appreciation. The prices of common stocks, especially those of smaller
companies, tend to fluctuate, particularly in the shorter term. Investors
should be willing to accept the risks associated with investments in
growth-oriented securities, some of which may be speculative and subject the
Fund to an additional risk. Also, ownership of Fund shares reduces the
bookkeeping and administrative inconveniences connected with direct purchases
of these securities.
Net asset value may fluctuate in response to the condition of individual
companies and general market and economic conditions and, as a result, the Fund
is not appropriate for a short-term investor.
This Fund is designed primarily for capital appreciation. Providing
current income is not an objective of the Fund. Any income produced is
expected to be minimal. Investors should not consider a purchase of Fund
shares as equivalent to a complete investment program. The Delaware Group
includes a family of funds, generally available through registered investment
dealers, which may be used together to create a more complete investment
program.
THE DELAWARE DIFFERENCE
PLANS AND SERVICES
The Delaware Difference is our commitment to provide you with superior
information and quality service on your investments in the Delaware Group of
funds.
SHAREHOLDER PHONE DIRECTORY
INVESTOR INFORMATION CENTER
800-523-4640
(PHILADELPHIA 215-988-1333)
FUND INFORMATION
LITERATURE
PRICE, YIELD AND
PERFORMANCE FIGURES
SHAREHOLDER SERVICE CENTER
800-523-1918
(PHILADELPHIA 215-988-1241)
INFORMATION ON EXISTING
REGULAR INVESTMENT
ACCOUNTS AND RETIREMENT
PLAN ACCOUNTS
WIRE INVESTMENTS
WIRE LIQUIDATIONS
TELEPHONE LIQUIDATIONS
TELEPHONE EXCHANGES
DELAPHONE
800-362-FUND
(800-362-3863)
SHAREHOLDER SERVICES
During business hours, you can call the Fund's Shareholder Service
Center. Our representatives can answer any questions about your account, the
Fund, the various service features and other funds in the Delaware Group.
PERFORMANCE INFORMATION
During business hours, you can call the Investor Information Center to
get current performance information.
DELAPHONE SERVICE
Delaphone is an account inquiry service for investors with Touch-Tone(R)
phone service. It enables you to get information on your account faster than
the mailed statements and confirmations. Delaphone is available seven days a
week, 24 hours a day.
STATEMENTS AND CONFIRMATIONS
You will receive quarterly statements of your account summarizing all
transactions during the period. A confirmation statement will be sent
following all transactions other than those involving a reinvestment of
distributions. See Dividend Reinvestment Plan below. You should examine
statements and confirmations by calling the Shareholder Service Center.
-11-
<PAGE> 17
(DTF-ABC)
DUPLICATE CONFIRMATIONS
If your investment dealer is noted on your investment application, we
will send your dealer a duplicate confirmation. This makes it easier for your
investment dealer to help you manage your investments.
TAX INFORMATION
Each year, the Fund will mail to you information on the tax status of
your dividends and distributions.
DIVIDEND REINVESTMENT PLAN
You can elect to have your distributions (capital gains and/or dividend
income) paid to you by check or reinvested in your account. Also, you may
invest your distributions in certain other funds in the Delaware Group, subject
to the exceptions noted below as well as the eligibility and minimum purchase
requirements set forth in each fund's prospectus. Reinvestments of
distributions into Class A Shares of the Fund or of other Delaware Group funds
are made without a front-end sales charge. Reinvestments of distributions into
Class B Shares of the Fund or of other Delaware Group funds and Class C Shares
of the Fund or of other Delaware Group funds are also made without any sales
charge and will not be subject to a CDSC if later redeemed. See Automatic
Conversion of Class B Shares under Buying Shares for information concerning the
automatic conversion of Class B Shares acquired by reinvesting dividends.
Holders of Class A Shares of the Fund may not reinvest their
distributions into the Class B Shares or Class C Shares of any fund in the
Delaware Group, including the Fund. Holders of Class B Shares of the Fund may
reinvest their distributions only into the Class B Shares of the funds in the
Delaware Group which offer that class of shares (the "Class B Funds").
Similarly, holders of Class C Shares of the Fund may reinvest their
distributions only into the Class C Shares of the funds in the Delaware Group
which offer that class of shares (the "Class C Funds"). See Class B Funds and
Class C Funds under Buying Shares for a list of the funds offering those
classes of shares. For more information about reinvestments, call the
Shareholder Service Center.
EXCHANGE PRIVILEGE
The Exchange Privilege permits shareholders to exchange all or part of
their shares into shares of the other funds in the Delaware Group, subject to
certain exceptions and limitations noted below as well as the eligibility and
minimum purchase requirements set forth in each fund's prospectus.
For additional information on exchanges, see Investing by Exchange under How
to Buy Shares and Redemption and Exchange.
WEALTH BUILDER OPTION
You may elect to have amounts in your account automatically invested in
shares of other funds in the Delaware Group. Investments under this feature
are exchanges and are therefore subject to the same conditions and limitations
as other exchanges of Class A, Class B and Class C Shares. See Redemption and
Exchange.
-12-
<PAGE> 18
(DTF-ABC)
RIGHT OF ACCUMULATION
With respect to Class A Shares, the Right of Accumulation feature allows
you to combine the value of your current holdings of Class A Shares, Class B
Shares and Class C Shares of the Fund with the dollar amount of new purchases
of Class A Shares to qualify for a reduced front-end sales charge. Under the
COMBINED PURCHASES PRIVILEGE, you may also include certain shares that you own
in other funds in the Delaware Group. See Buying Shares.
LETTER OF INTENTION
The Letter of Intention feature permits you to obtain a reduced
front-end sales charge on purchases of Class A Shares by aggregating certain of
your purchases of Delaware Group fund shares over a 13-month period. See
Buying Shares and Part B.
12-MONTH REINVESTMENT PRIVILEGE
The 12-Month Reinvestment Privilege permits you to reinvest proceeds of
Class A Shares within one year of the date of redemption, without a front-end
sales charge. See Part B.
DELAWARE GROUP ASSET PLANNER
Delaware Group Asset Planner is an asset allocation service that gives
investors, working with a professional financial adviser, the ability to more
easily design and maintain investments in a diversified selection of Delaware
Group mutual funds. The Asset Planner service offers a choice of four
predesigned Allocation Strategies (each with a different risk/reward profile)
made up of separate investments in predetermined percentages of Delaware Group
funds. With the guidance of a financial adviser, investors may also tailor a
Strategy that meets their personal needs and goals. See How to Buy Shares
under Buying Shares.
FINANCIAL INFORMATION ABOUT THE FUND
Each fiscal year, you will receive an audited annual report and an
unaudited semi-annual report. These reports provide detailed information about
the Fund's investments and performance. The Fund's fiscal year ends on June
30.
-13-
<PAGE> 19
(DTF-ABC)
RETIREMENT PLANNING
An investment in the Fund may be suitable for tax-deferred retirement
plans. Among the retirement plans noted below, Class B Shares are available
for investment only by Individual Retirement Accounts, Simplified Employee
Pension Plans, 457 Deferred Compensation Plans and 403(b)(7) Deferred
Compensation Plans.
Retirement plans may be subject to plan establishment fees, annual
maintenance fees and/or other administrative or trustee fees. Fees are based
upon the number of participants in the plan as well as the services selected.
Additional information about fees is included in retirement plan materials.
Fees are quoted upon request. Certain shareholder investment services
available to non-retirement plan shareholders may not be available to
retirement plan shareholders. Certain retirement plans may qualify to purchase
the Trend Fund Institutional Class. For additional information on any of the
plans and Delaware's retirement services, call the Shareholder Service Center
or see Part B.
INDIVIDUAL RETIREMENT ACCOUNT ("IRA")
Individuals, even if they participate in an employer-sponsored
retirement plan, may establish their own retirement program for investments in
each of the Classes. Contributions to an IRA may be tax-deductible and
earnings are tax-deferred. Under the Tax Reform Act of 1986, the tax
deductibility of IRA contributions is restricted, and in some cases eliminated,
for individuals who participate in certain employer-sponsored retirement plans
and whose annual income exceeds certain limits. Existing IRAs and future
contributions up to the IRA maximums, whether deductible or not, still earn on
a tax-deferred basis.
SIMPLIFIED EMPLOYEE PENSION PLAN ("SEP/IRA")
A SEP/IRA may be established by an employer who wishes to sponsor a
tax-sheltered retirement program by making contributions on behalf of all
eligible employees. Each of the Classes is available for investment by a
SEP/IRA.
SALARY REDUCTION SIMPLIFIED EMPLOYEE PENSION PLAN ("SAR/SEP")
Offers employers with 25 or fewer eligible employees the ability to
establish a SEP/IRA that permits salary deferral contributions. An employer
may also elect to make additional contributions to this plan. Class B Shares
are not available for purchase by such plans.
403(B)(7) DEFERRED COMPENSATION PLAN
Permits employees of public school systems or of certain types of
non-profit organizations to enter into a deferred compensation arrangement for
the purchase of shares of each of the Classes.
457 DEFERRED COMPENSATION PLAN
Permits employees of state and local governments and certain other
entities to enter into a deferred compensation arrangement for the purchase of
shares of each of the Classes.
-14-
<PAGE> 20
(DTF-ABC)
PROTOTYPE PROFIT SHARING OR MONEY PURCHASE PENSION PLAN
Offers self-employed individuals, partnerships and corporations a
tax-qualified plan which provides for the investment of contributions in Class
A Shares or Class C Shares. Class B Shares are not available for purchase by
such plans.
PROTOTYPE 401(K) DEFINED CONTRIBUTION PLAN
Permits employers to establish a tax-qualified plan based on salary
deferral contributions for investment in Class A or Class C Shares. Class B
Shares are not available for purchase by such plans.
ALLIED PLANS
Class A Shares are available for purchase by participants in 401(k)
Defined Contribution Plans ("Allied Plans") which are made available under a
joint venture agreement between the Distributor and another institution through
which mutual funds are marketed and which allow investments in Class A Shares
of designated Delaware Group funds ("eligible Delaware Group fund shares"), as
well as shares of designated classes of non-Delaware Group funds ("eligible
non-Delaware Group fund shares"). Class B Shares and Class C Shares are not
eligible for purchase by Allied Plans.
With respect to purchases made in connection with an Allied Plan, the
value of eligible Delaware Group and eligible non-Delaware Group fund shares
held by a participant under the Allied Plan may be combined with the dollar
amount of new purchases by that participant to obtain a reduced front-end sales
charge on additional purchases of eligible Delaware Group fund shares. See
Front-End Sales Charge Alternative - Class A Shares under Buying Shares.
Participants in Allied Plans may exchange all or part of their eligible
Delaware Group fund shares for other eligible Delaware Group fund shares or for
eligible non-Delaware Group fund shares at net asset value without payment of a
front-end sales charge. However, exchanges of eligible fund shares, both
Delaware Group and non-Delaware Group, which were not subject to a front-end
sales charge, will be subject to the applicable sales charge if exchanged for
eligible Delaware Group fund shares to which a sales charge applies. No sales
charge will apply if the eligible fund shares were previously acquired through
the exchange of eligible shares on which a sales charge was already paid or
through the reinvestment of dividends. See Investing by Exchange.
The Limited CDSC is applicable to redemptions of net asset value
purchases from an Allied Plan on which a dealer's commission has been paid.
Waivers of the Limited CDSC, as described below under Waiver of Limited CDSC -
Class A Shares, apply to redemptions by participants in Allied Plans except in
the case of exchanges between eligible Delaware Group and non-Delaware Group
fund shares. When eligible Delaware Group fund shares are exchanged into
eligible non-Delaware Group fund shares, the Limited CDSC will be imposed at
the time of the exchange, unless the joint venture agreement specifies that the
amount of the CDSC will be paid by the financial adviser or selling dealer.
See Contingent Deferred Sales Charge for Certain Purchases of Class A Shares
Made at Net Asset Value under Redemption and Exchange.
A dealer's commission may be payable on purchases of eligible Delaware
Group fund shares under an Allied Plan. In determining a financial adviser's
eligibility for a dealer's commission on net asset value purchases of eligible
Delaware Group fund shares in connection with Allied Plans, all participant
holdings in the Allied Plan will be aggregated. See Front-End Sales Charge
Alternative - Class A Shares under Buying Shares.
-15-
<PAGE> 21
(DTF-ABC)
BUYING SHARES
PURCHASE AMOUNTS
Generally, the minimum initial purchase is $1,000 for Class A Shares,
Class B Shares and Class C Shares. Subsequent purchases of shares of any Class
generally must be $100 or more. Class A Shares purchased under the Uniform
Gifts to Minors Act or Uniform Transfers to Minors Act are subject to a minimum
initial purchase of $250 and a minimum subsequent purchase of $25. In
addition, there is a maximum purchase limitation of $250,000 on each purchase
of Class B Shares; for Class C shares, each purchase must be in an amount that
is less than $1,000,000. An investor may exceed these maximum purchase
limitations by making cumulative purchases over a period of time. In doing so,
an investor should keep in mind that reduced front-end sales charges are
available on investments of $100,000 or more in Class A Shares, and that Class
A Shares (i) are subject to lower annual 12b-1 Plan expenses than Class B
Shares and Class C Shares and (ii) generally are not subject to a CDSC.
For retirement plans, the maximum purchase limitations apply only to the
initial purchase of Class B Shares or Class C Shares by the plan. Minimum
purchase requirements do not apply to retirement plans other than IRAs for
which there is a minimum initial purchase of $250, and a minimum subsequent
purchase of $25, regardless of which Class is selected.
ALTERNATIVE PURCHASE ARRANGEMENTS
Shares may be purchased at a price equal to the next determined net
asset value per share, subject to a sales charge which may be imposed, at the
election of the purchaser, at the time of the purchase with respect to Class A
Shares ("front-end sales charge alternative"), or on a contingent deferred
basis with respect to Class B Shares ("deferred sales charge alternative") or
Class C Shares ("level sales charge alternative").
Class A Shares. An investor who elects the front-end sales charge
alternative acquires Class A Shares. Class A Shares incur a sales charge when
they are purchased but generally are not subject to any sales charge when they
are redeemed. Class A Shares are subject to annual 12b-1 Plan expenses of up
to a maximum of .30% of average daily net assets of such shares. See
Contingent Deferred Sales Charge for Certain Purchases of Class A Shares Made
at Net Asset Value and Distribution (12b-1) and Service. Certain purchases of
Class A Shares qualify for reduced front-end sales charges. See Front-End
Sales Charge Alternative - Class A Shares, below.
Class B Shares. An investor who elects the deferred sales charge
alternative acquires Class B Shares. Class B Shares do not incur a front-end
sales charge when they are purchased, but they are subject to a sales charge if
they are redeemed within six years of purchase and are subject to annual 12b-1
Plan expenses of up to a maximum of 1% (.25% of which are service fees to be
paid to the Distributor, dealers or others for providing personal service
and/or maintaining shareholder accounts) of average daily net assets of such
shares for approximately eight years after purchase. Class B Shares permit all
of the investor's dollars to work from the time the investment is made. The
higher 12b-1 Plan expenses paid by Class B Shares will cause such shares to
have a higher expense ratio and to pay lower dividends than those related to
Class A Shares. At the end of approximately eight years after purchase, Class
B Shares will automatically be converted into Class A Shares. See Automatic
Conversion of Class B Shares, below.
Class C Shares. An investor who elects the level sales charge
alternative acquires Class C Shares. Class C Shares do not incur a front-end
sales charge when they are purchased, but are subject to a sales charge if they
are redeemed within twelve months of purchase and are subject to annual 12b-1
Plan expenses of up to a maximum of 1% (.25% of which are service fees to be
paid to the Distributor, dealers or others for providing personal service
and/or maintaining shareholder accounts) of average daily net assets of such
shares for the life of the investment. The higher 12b-1 Plan expenses paid by
Class C Shares will cause such shares to have a higher expense ratio and to pay
lower dividends than those related to the Class A Shares. Unlike Class B
Shares, Class C Shares do not convert to another class.
The alternative purchase arrangements described above permit investors
in the Fund to choose the method of purchasing shares that is most suitable
given the amount of their purchase, the length of time they expect to hold
their shares and other relevant circumstances. Investors should determine
whether, given
-16-
<PAGE> 22
(DTF-ABC)
their particular circumstances, it is more advantageous to purchase Class A
Shares and incur a front-end sales charge, purchase Class B Shares and have the
entire initial purchase amount invested in the Fund with their investment being
subject to a CDSC if they redeem shares within six years of purchase, or
purchase Class C Shares and have the entire initial purchase amount invested in
the Fund with their investment being subject to a CDSC if they redeem shares
within twelve months of purchase. In addition, investors should consider the
level of annual 12b-1 Plan expenses to which each of the Classes is subject
and, in comparing Class B Shares to Class C Shares, the desirability of an
automatic conversion feature, which is available only for Class B Shares.
As an illustration, investors who qualify for significantly reduced
front-end sales charges on purchases of Class A Shares, as described below,
might elect the front-end sales charge alternative because similar sales charge
reductions are not available for purchases under either the deferred sales
charge alternative or the level sales charge alternative. Moreover, shares
acquired under the front-end sales charge alternative are subject to annual
12b-1 Plan expenses of up to .30%, whereas Class B Shares acquired under the
deferred sales charge alternative are subject to annual 12b-1 Plan expenses of
up to 1% for approximately eight years after purchase (see Automatic Conversion
of Class B Shares) and Class C Shares acquired under the level sales charge
alternative are subject to annual 12b-1 Plan expenses of up to 1% for the life
of the investment. However, because front-end sales charges are deducted at
the time of purchase, investors who buy Class A Shares would not have their
full purchase amount invested in the Fund.
Certain other investors might determine it to be more advantageous to
purchase Class B Shares and have all their funds invested initially, although
they would be subject to a CDSC for up to six years after purchase, as well as
annual 12b-1 Plan expenses of up to 1% until the shares are automatically
converted into Class A Shares. Still other investors might determine it to be
more advantageous to purchase Class C Shares and have all of their funds
invested initially, recognizing that they would be subject to a CDSC for just
twelve months after purchase, but that Class C Shares do not offer a conversion
feature, so their shares would be subject to annual 12b-1 Plan expenses of up
to 1% for the life of the investment. The higher 12b-1 Plan expenses on Class
B Shares and Class C Shares will be offset to the extent a return is realized
on the additional money initially invested under the deferred sales charge
alternative or the level sales charge alternative. However, there can be no
assurance as to the return, if any, that will be realized on such additional
money.
Prospective investors should refer to Appendix A to this Prospectus for
an illustration of the potential impact on a long-term shareholder's investment
in the Fund under each purchase option.
For the distribution and related services provided to, and the expenses
borne on behalf of, the Fund, the Distributor and others will be paid, in the
case of the Class A Shares, from the proceeds of the front-end sales charge and
12b-1 Plan fees and, in the case of the Class B Shares and the Class C Shares,
from the proceeds of the 12b-1 Plan fees and, if applicable, the CDSC incurred
upon redemption. Sales personnel may receive different compensation for
selling Class A, Class B and Class C Shares. INVESTORS SHOULD UNDERSTAND THAT
THE PURPOSE AND FUNCTION OF THE RESPECTIVE 12b-1 PLANS AND THE CDSCs APPLICABLE
TO CLASS B SHARES AND CLASS C SHARES ARE THE SAME AS THOSE OF THE 12b-1 PLAN
AND THE FRONT-END SALES CHARGE APPLICABLE TO CLASS A SHARES IN THAT SUCH FEES
AND CHARGES PROVIDE FOR THE FINANCING OF THE DISTRIBUTION OF THE RESPECTIVE
CLASSES. See 12b-1 Distribution Plans - Class A, Class B and Class C Shares.
Dividends paid by the Fund with respect to the Class A, Class B and
Class C Shares, to the extent any dividends are paid, will be calculated in the
same manner, at the same time, on the same day and will be in the same amount,
except that the additional amount of 12b-1 Plan expenses relating to the Class
B Shares and the Class C Shares will be borne exclusively by such shares. See
Calculation of Offering Price and Net Asset Value Per Share.
The NASD has adopted certain rules relating to investment company sales
charges. The Fund and the Distributor intend to operate in compliance with
these rules.
-17-
<PAGE> 23
(DTF-ABC)
FRONT-END SALES CHARGE ALTERNATIVE - CLASS A SHARES
The Class A Shares may be purchased at the offering price, which
reflects a maximum front-end sales charge of 4.75%. See Calculation of
Offering Price and Net Asset Value Per Share.
Purchases of $100,000 or more carry a reduced front-end sales charge as
shown in the following table.
<TABLE>
<CAPTION>
Trend Fund A Class
- ------------------------------------------------------------------------------------------------------------------------------
Dealer's
Front-End Sales Charge as % of Concession***
Amount of Purchase Offering Amount as % of
- ------------------------------------------------------------------------------------------------------------------------------
Price Invested** Offering Price
<S> <C> <C> <C>
Less than $100,000 4.75% 5.00% 4.00%
$100,000 but under $250,000 3.75 3.87 3.00
$250,000 but under $500,000 2.50 2.53 2.00
$500,000 but under $1,000,000* 2.00 2.04 1.60
</TABLE>
* There is no front-end sales charge on purchases of Class A Shares of $1
million or more but, under certain limited circumstances, a 1% Limited
CDSC may apply upon redemption of such shares.
** Based upon the net asset value per share of the Class A Shares as of the
end of the Fund's most recent fiscal year.
*** Financial institutions or their affiliated brokers may receive an agency
transaction fee in the percentages set forth above.
- -------------------------------------------------------------------------------
The Fund must be notified when a sale takes place which would qualify for
the reduced front-end sales charge on the basis of previous or current
purchases. The reduced front-end sales charge will be granted upon
confirmation of the shareholder's holdings by the Fund. Such reduced
front-end sales charges are not retroactive.
From time to time, upon written notice to all of its dealers, the
Distributor may hold special promotions for specified periods during
which the Distributor may reallow to dealers up to the full amount of the
front-end sales charge shown above. In addition, certain dealers who
enter into an agreement to provide extra training and information on
Delaware Group products and services and who increase sales of Delaware
Group funds may receive an additional concession of up to .15% of the
offering price. Dealers who receive 90% or more of the sales charge may
be deemed to be underwriters under the Securities Act of 1933.
- ------------------------------------------------------------------------------
-18-
<PAGE> 24
(DTF-ABC)
For initial purchases of Class A Shares of $1,000,000 or more, a
dealer's commission may be paid by the Distributor to financial advisers
through whom such purchases are made, in accordance with the following
schedule:
<TABLE>
<CAPTION>
DEALER'S
COMMISSION
----------
(as a percent-
AMOUNT age of amount
OF PURCHASE purchased)
- -----------
<S> <C>
Up to $2 million 1.00%
Next $1 million up to $3 million .75
Next $2 million up to $5 million .50
Amount over $5 million .25
</TABLE>
In determining a financial adviser's eligibility for the dealer's
commission, purchases of Class A Shares of other Delaware Group funds as to
which a Limited CDSC applies may be aggregated with those of the Class A Shares
of the Fund. Financial advisers also may be eligible for a dealer's commission
in connection with certain purchases made under a Letter of Intention or
pursuant to an investor's Right of Accumulation. Financial advisers should
contact the Distributor concerning the applicability and calculation of the
dealer's commission in the case of combined purchases.
An exchange from other Delaware Group funds will not qualify for
payment of the dealer's commission, unless such exchange is from a Delaware
Group fund with assets as to which a dealer's commission or similar payment has
not been previously paid. The schedule and program for payment of the dealer's
commission are subject to change or termination at any time by the Distributor
in its discretion.
Redemptions of Class A Shares purchased at net asset value may result
in the imposition of a Limited CDSC if the dealer's commission described above
was paid in connection with the purchase of those shares. See Contingent
Deferred Sales Charge for Certain Purchases of Class A Shares Made at Net Asset
Value under Redemption and Exchange.
COMBINED PURCHASES PRIVILEGE
By combining your holdings of Class A Shares with your holdings of
Class B Shares and/or Class C Shares of the Fund and shares of the other funds
in the Delaware Group, except those noted below, you can reduce the front-end
sales charges on any additional purchases of Class A Shares. Shares of
Delaware Group Premium Fund, Inc. beneficially owned in connection with
ownership of variable insurance products may be combined with other Delaware
Group fund holdings. Shares of other funds that do not carry a front-end sales
charge or CDSC may not be included unless they were acquired through an
exchange from a Delaware Group fund that does carry a front-end sales charge or
CDSC.
This privilege permits you to combine your purchases and holdings
with those of your spouse, your children under twenty-one years of age and any
trust, fiduciary or retirement account for the benefit of such family members.
It also permits you to use these combinations under a Letter of
Intention. A Letter of Intention allows you to make purchases over a 13-month
period and qualify the entire purchase for a reduction in front-end sales
charges on Class A Shares.
Combined purchases of $1,000,000 or more, including certain purchases
made at net asset value pursuant to a Right of Accumulation or under a Letter
of Intention, may trigger the payment of a dealer's commission and the
applicability of a Limited CDSC. Investors should consult their financial
advisers or the Shareholder Service Center about the operation of these
features. See Front-End Sales Charge Alternative - Class A Shares under Buying
Shares.
-19-
<PAGE> 25
(DTF-ABC)
BUYING AT NET ASSET VALUE
Class A Shares may be purchased at net asset value under the Delaware
Group Dividend Reinvestment Plan and, under certain circumstances, the 12-month
Reinvestment Privilege and the Exchange Privilege. See The Delaware Difference
and Redemption and Exchange for additional information.
Purchases of Class A Shares may be made at net asset value by current
and former officers, directors and employees (and members of their immediate
families) of the Manager, any affiliate, any of the funds in the Delaware
Group, certain of their agents and registered representatives and employees of
authorized investment dealers and by employee benefit plans for such entities.
Individual purchases include retirement accounts and must be for accounts in
the name of the individual or a qualifying family member. Purchases of Class A
Shares may be made by clients of registered representatives of an authorized
investment dealer at net asset value within six months of a change of the
registered representative's employment, if the purchase is funded by proceeds
from an investment where a front-end sales charge has been assessed and the
redemption of the investment did not result in the imposition of a CDSC or
other redemption charge. Purchases of Class A Shares also may be made at net
asset value by bank employees who provide services in connection with
agreements between the bank and unaffiliated brokers or dealers concerning
sales of Class A Shares. Officers, directors and key employees of
institutional clients of the Manager or any of its affiliates may purchase
Class A Shares at net asset value. Moreover, purchases may be effected at net
asset value for the benefit of the clients of brokers, dealers and registered
investment advisers affiliated with a broker or dealer, if such broker, dealer
or investment adviser has entered into an agreement with the Distributor
providing specifically for the purchase of Class A Shares in connection with
special investment products, such as wrap accounts or similar fee based
programs.
Investments in Class A Shares made by plan level and/or participant
retirement accounts that are for the purpose of repaying a loan taken from such
accounts will be made at net asset value. Loan repayments made to a Delaware
Group account in connection with loans originated from accounts previously
maintained by another investment firm will also be invested at net asset value.
The Fund must be notified in advance that an investment qualifies for
purchase of Class A Shares at net asset value.
GROUP INVESTMENT PLANS
Group Investment Plans (e.g., SEP/IRA, SAR/SEP, Prototype Profit
Sharing, Pension and 401(k) Defined Contribution Plans) may benefit from the
reduced front-end sales charges relating to the Class A Shares set forth in the
table on page _____, based on total plan assets. In addition, 403(b)(7) and
457 Retirement Plan Accounts may benefit from a reduced front-end sales charge
on Class A Shares based on the total amount invested by all participants in the
plan by satisfying the following criteria: (i) the employer for which the plan
was established has 250 or more eligible employees and the plan lists only one
broker of record, or (ii) the plan includes employer contributions and the plan
lists only one broker of record. If a company has more than one plan investing
in the Delaware Group of funds, then the total amount invested in all plans
will be aggregated to determine the applicable front-end sales charge reduction
on each purchase, both initial and subsequent, if, at the time of each such
purchase, the company notifies the Fund that it qualifies for the reduction.
Employees participating in such Group Investment Plans may also combine the
investments held in their plan account to determine the front-end sales charge
applicable to purchases in non-retirement Delaware Group investment accounts
if, at the time of each such purchase, they notify the Fund that they are
eligible to combine purchase amounts held in their plan account.
For additional information on these plans, including plan forms,
applications, minimum investments and any applicable account maintenance fees,
contact your investment dealer or the Distributor.
For other retirement plans and special services, see Retirement
Planning.
-20-
<PAGE> 26
(DTF-ABC)
DEFERRED SALES CHARGE ALTERNATIVE - CLASS B SHARES
Class B Shares may be purchased at net asset value without the
imposition of a front-end sales charge and, as a result, the Fund will invest
the full amount of the investor's purchase payment. The Distributor currently
anticipates compensating dealers or brokers for selling Class B Shares at the
time of purchase from its own assets in an amount equal to no more than 4% of
the dollar amount purchased. As discussed below, however, Class B Shares are
subject to annual 12b-1 Plan expenses and, if redeemed within six years of
purchase, a CDSC.
Proceeds from the CDSC and the annual 12b-1 Plan fees are paid to the
Distributor and others for providing distribution and related services, and
bearing related expenses, in connection with the sale of Class B Shares. These
payments support the compensation paid to dealers or brokers for selling Class
B Shares. Payments to the Distributor and others under the Class B 12b-1 Plan
may be in an amount equal to no more than 1% annually. The combination of the
CDSC and the proceeds of the 12b-1 Plan fees facilitates the ability of the
Fund to sell the Class B Shares without deducting a front-end sales charge at
the time of purchase.
Shareholders of the Fund's Class B Shares exercising the exchange
privilege described below will continue to be subject to the CDSC schedule for
the Fund's Class B Shares described in this Prospectus, even after the
exchange. Such CDSC schedule may be higher than the CDSC schedule relating to
the Class B Shares acquired as a result of the exchange. See Redemption and
Exchange.
AUTOMATIC CONVERSION OF CLASS B SHARES
Except for shares acquired through a reinvestment of dividends, Class
B Shares held for eight years after purchase are eligible for automatic
conversion into Class A Shares. The Fund will effect conversions of Class B
Shares into Class A Shares only four times in any calendar year, on the last
business day of the second full week of March, June, September and December
(each, a "Conversion Date"). If the eighth anniversary after a purchase of
Class B Shares falls on a Conversion Date, an investor's Class B Shares will be
converted on that date. If the eighth anniversary occurs between Conversion
Dates, an investor's Class B Shares will be converted on the next Conversion
Date after such anniversary. Consequently, if a shareholder's eighth
anniversary falls on the day after a Conversion Date, that shareholder will
have to hold Class B Shares for as long as three additional months after the
eighth anniversary of purchase before the shares will automatically convert
into Class A Shares.
Class B Shares of a fund acquired through reinvestment of dividends
will convert to the corresponding Class A Shares of that fund (or, in the case
of Delaware Group Cash Reserve, Inc., the Delaware Cash Reserve Consultant
Class) pro-rata with Class B Shares of that fund not acquired through dividend
reinvestment.
All such automatic conversions of Class B Shares will constitute
tax-free exchanges for federal income tax purposes. See Taxes.
LEVEL SALES CHARGE ALTERNATIVE - CLASS C SHARES
Class C Shares may be purchased at net asset value without the
imposition of a front-end sales charge and, as a result, the Fund will invest
the full amount of the investor's purchase payment. The Distributor currently
anticipates compensating dealers or brokers for selling Class C Shares at the
time of purchase from its own assets in an amount equal to no more than 1% of
the dollar amount purchased. As discussed below, however, Class C Shares are
subject to annual 12b-1 Plan expenses and, if redeemed within twelve months of
purchase, a CDSC.
Proceeds from the CDSC and the annual 12b-1 Plan fees are paid to the
Distributor and others for providing distribution and related services, and
bearing related expenses, in connection with the sale of Class C Shares. These
payments support the compensation paid to dealers or brokers for selling Class
C Shares. Payments to the Distributor and others under the Class C 12b-1 Plan
may be in an amount equal to no more than 1% annually.
Shareholders of the Fund's Class C Shares who exercise the exchange
privilege described below will continue to be subject to the CDSC schedule for
the Fund's Class C Shares as described in this Prospectus. See Redemption and
Exchange.
-21-
<PAGE> 27
(DTF-ABC)
CONTINGENT DEFERRED SALES CHARGE - CLASS B SHARES AND CLASS C SHARES
Class B Shares redeemed within six years of purchase may be subject
to a CDSC at the rates set forth below, and Class C Shares redeemed within
twelve months of purchase may be subject to a CDSC of 1%. CDSCs are charged as
a percentage of the dollar amount subject to the CDSC. The charge will be
assessed on an amount equal to the lesser of the net asset value at the time of
purchase of the shares being redeemed or the net asset value of those shares at
redemption. No CDSC will be imposed on increases in net asset value above the
initial purchase price. In addition, no CDSC will be assessed on redemptions
of shares received through reinvestments of dividends or capital gains
distributions. For purposes of this formula, the "net asset value at the time
of purchase" will be the net asset value at purchase of either the Class B
Shares or the Class C Shares of the Fund, even if those shares are later
exchanged for shares of another Delaware Group fund. In the event of an
exchange of the shares, the "net asset value of such shares at the time of
redemption" will be the net asset value of the shares that were acquired in the
exchange.
The following table sets forth the rates of the CDSC for the Class B
Shares of the Fund:
<TABLE>
<CAPTION>
CONTINGENT DEFERRED
SALES CHARGE (AS A
PERCENTAGE OF
DOLLAR AMOUNT
YEAR AFTER PURCHASE MADE SUBJECT TO CHARGE)
- ------------------------ ------------------
<S> <C>
0-2 4%
3-4 3%
5 2%
6 1%
7 and thereafter None
</TABLE>
During the seventh year after purchase and, thereafter, until converted
automatically into Class A Shares of the Fund, the Class B Shares will still be
subject to annual 12b-1 Plan expenses of up to 1% of average daily net assets
of those shares. See Automatic Conversion of Class B Shares, above. Investors
are reminded that the Class A Shares into which the Class B Shares will convert
are subject to ongoing annual 12b-1 Plan expenses of up to a maximum of .30% of
average daily net assets representing such shares.
In determining whether a CDSC is applicable to a redemption of Class
B Shares, it will be assumed that shares held for more than six years are
redeemed first, followed by shares acquired through the reinvestment of
dividends or distributions, and finally by shares held longest during the
six-year period. With respect to the Class C Shares, it will be assumed that
shares held for more than twelve months are redeemed first, followed by shares
acquired through the reinvestment of dividends or distributions, and finally by
shares held for twelve months or less. All investments made during a calendar
month, regardless of what day of the month the investment occurred, will age
one month on the last day of that month and each subsequent month.
The CDSC is waived on certain redemptions of Class B Shares and
Class C Shares. See Waiver of CDSC - Class B and Class C Shares under
Redemption and Exchange.
12b-1 DISTRIBUTION PLANS - CLASS A, CLASS B AND CLASS C SHARES
Under the distribution plans adopted by the Fund in accordance with
Rule 12b-1 under the 1940 Act, the Fund is permitted to pay the Distributor
annual distribution fees of up to .30% of the average daily net assets of the
Class A Shares, 1% of the average daily net assets of the Class B Shares and 1%
of the average daily net assets of the Class C Shares. These fees, which are
payable monthly, compensate the Distributor for providing distribution and
related services and bearing certain expenses of each Class. The 12b-1 Plans
applicable to the Class B Shares and the Class C Shares are designed to permit
an investor to purchase Class B Shares or Class C Shares through dealers or
brokers without the assessment of a front-end sales charge while enabling the
Distributor to compensate dealers and brokers for the sale of such shares. For
a more detailed discussion of the 12b-1 Plans relating to the Class A, Class B
and Class C Shares, see Distribution (12b-1) and Service under Management of
the Fund.
OTHER PAYMENTS TO DEALERS -- CLASS A, CLASS B AND CLASS C SHARES
In addition, from time to time at the discretion of the Distributor,
all registered broker/dealers whose aggregate sales of the
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<PAGE> 28
(DTF-ABC)
Classes exceed certain limits, as set by the Distributor, may receive from the
Distributor an additional payment of up to .25% of the dollar amount of such
sales. The Distributor may also provide additional promotional incentives or
payments to dealers that sell shares of the Delaware Group of funds. In some
instances, these incentives or payments may be offered only to certain dealers
who maintain, have sold or may sell certain amounts of shares.
Subject to pending amendments to the NASD's Rules of Fair Practice,
in connection with the promotion of Delaware Group fund shares, the Distributor
may, from time to time, pay to participate in dealer-sponsored seminars and
conferences, reimburse dealers for expenses incurred in connection with
preapproved seminars, conferences and advertising and may, from time to time,
pay or allow additional promotional incentives to dealers, which shall include
non-cash concessions, such as certain luxury merchandise or a trip to or
attendance at a business or investment seminar at a luxury resort, as part of
preapproved sales contests. Payment of non-cash compensation to dealers is
currently under review by the NASD and the Securities and Exchange Commission.
It is likely that the NASD's Rules of Fair Practice will be amended such that
the ability of the Distributor to pay non-cash compensation as described above
will be restricted in some fashion. The Distributor intends to comply with the
NASD's Rules of Fair Practice as they may be amended. In addition, as noted
above, the Distributor may pay dealers a commission in connection with net
asset value purchases.
CLASS B FUNDS AND CLASS C FUNDS
The following funds currently offer Class B Shares and Class C
Shares: Delaware Group Delchester High-Yield Bond Fund, Inc., Delaware Group
Government Fund, Inc., Limited-Term Government Fund of Delaware Group
Limited-Term Government Funds, Inc., Delaware Group Cash Reserve, Inc.,
Tax-Free USA Fund, Tax-Free Insured Fund and Tax-Free USA Intermediate Fund of
Delaware Group Tax-Free Fund, Inc., Delaware Group DelCap Fund, Inc., Delaware
Fund and Devon Fund of Delaware Group Delaware Fund, Inc., Decatur Income Fund
and Decatur Total Return Fund of Delaware Group Decatur Fund, Inc., Delaware
Group Value Fund, Inc., International Equity Series, Global Bond Series and
Global Assets Series of Delaware Group Global & International Funds, Inc., DMC
Tax-Free Income Trust-Pennsylvania and the Fund.
TREND FUND INSTITUTIONAL CLASS
In addition to offering the Class A, Class B and Class C Shares, the
Fund also offers the Trend Fund Institutional Class of shares, which is
described in a separate prospectus relating to that class of shares and is
available for purchase only by certain investors. Trend Fund Institutional
Class shares generally are distributed directly by the Distributor and do not
have a front-end sales charge, a CDSC or a Limited CDSC, and are not subject to
12b-1 Plan distribution expenses. To obtain a prospectus which describes the
Trend Fund Institutional Class, contact the Distributor by writing to the
address or by calling the telephone number listed on the cover of this
Prospectus.
DIVIDEND ORDERS
YOU MAY HAVE THE DIVIDENDS EARNED IN ONE FUND AUTOMATICALLY INVESTED
IN ANOTHER DELAWARE GROUP FUND WITH A DIFFERENT INVESTMENT OBJECTIVE. For more
information, see Dividend Reinvestment Plan under The Delaware Difference or
call the Shareholder Service Center.
HOW TO BUY SHARES
The Fund makes it easy to invest by mail, by wire, by exchange and
by arrangement with your investment dealer.
INVESTING THROUGH YOUR INVESTMENT DEALER
You can make a purchase of shares of the Classes through most
investment dealers who, as part of the service they provide, must transmit
orders promptly. They may charge for this service. If you want a dealer but
do not have one, we can refer you to one.
INVESTING BY MAIL
1. Initial Purchases--An Investment Application or, in the case of a
retirement account, an appropriate retirement plan application, must be
completed, signed and sent with a check payable to Trend Fund A Class, Trend
Fund B Class or Trend Fund C Class at 1818 Market Street, Philadelphia, PA
19103.
-23-
<PAGE> 29
(DTF-ABC)
2. Subsequent Purchases--Additional purchases may be made at any time
by mailing a check payable to Trend Fund A Class, Trend Fund B Class or Trend
Fund C Class. Your check should be identified with your name(s) and account
number. An investment slip (similar to a deposit slip) is provided at the
bottom of transaction confirmations and dividend statements that you will
receive from the Fund. Use of this investment slip can help expedite
processing of your check when making additional purchases. Your investment may
be delayed if you send additional purchases by certified mail.
INVESTING BY WIRE
You may purchase shares by requesting your bank to transmit funds by
wire to CoreStates Bank, N.A., ABA #031000011, account number 0114-2596
(include your name(s) and your account number for the Class in which you are
investing).
1. Initial Purchases--Before you invest, telephone the Fund's
Shareholder Service Center to get an account number. If you do not call first,
processing of your investment may be delayed. In addition, you must promptly
send your Investment Application or, in the case of a retirement account, an
appropriate retirement plan application, to Trend Fund A Class, Trend Fund B
Class or Trend Fund C Class at 1818 Market Street, Philadelphia, PA 19103.
2. Subsequent Purchases--You may make additional investments anytime by
wiring funds to CoreStates Bank, N.A., as described above. You should advise
the Fund's Shareholder Service Center by telephone of each wire you send.
If you want to wire investments to a retirement plan account, call
the Shareholder Service Center for special wiring instructions.
DELAWARE GROUP ASSET PLANNER
To invest in Delaware Group funds using the Asset Planner service,
you should complete a Delaware Group Asset Planner Account Registration Form,
which is available only from a financial adviser. The sales charge on the
investment is determined by the individual sales charges of the underlying
funds and their percentage allocation in the selected Strategy. The minimum
initial investment per Strategy is $2,000; subsequent investments must be at
least $100. Individual fund minimums do not apply to investments made using
the Asset Planner service. Class A, Class B and Class C Shares are available
for use inside the Asset Planner service; however, only "like" class shares may
be used within the same Strategy.
An annual maintenance fee, currently $35 per Strategy, is due at the
time of initial investment and by September 30th of each subsequent year. The
fee, payable to Delaware Service Company, Inc. to defray extra costs associated
with administering the Asset Planner service will be deducted automatically
from one of your Fund accounts if not paid by September 30th. See the
Statement of Additional of Information.
Investors will receive a customized quarterly Strategy Report
summarizing all Delaware Group Asset Planner investment performance and account
activity during the prior period. Confirmation statements will be sent
following all transactions other than those involving a reinvestment of
distributions.
Certain shareholder services are not available to investors using
the Asset Planner service, due to its special design. These include Delaphone,
Checkwriting, Wealth Builder Option and Letter of Intention. Systematic
Withdrawal Plans are available after the account has been open for two years.
INVESTING BY EXCHANGE
If you have an investment in another mutual fund in the Delaware
Group, you may write and authorize an exchange of part or all of your
investment into shares of the Fund. If you wish to open an account by
exchange, call the Shareholder Service Center for more information. All
exchanges are subject to the eligibility and minimum purchase requirements set
forth in each fund's prospectus.
Shareholders of Class A Shares may exchange all or part of their
shares for certain of the shares of other funds in the Delaware Group,
including other Class A Shares, but may not exchange their shares for Class B
Shares or Class C Shares of the Fund or for any Class B Shares or Class C
Shares of any other fund in the Delaware Group. Shareholders of Class B Shares
of the Fund are permitted to exchange all or part of their Class B Shares only
into the
-24-
<PAGE> 30
(DTF-ABC)
corresponding class of shares of the Class B Funds. Similarly, shareholders of
Class C Shares of the Fund are permitted to exchange all or part of their Class
C Shares only into the corresponding class of shares of the Class C Funds.
Class B Shares of the Fund and Class C Shares of the Fund acquired by exchange
will continue to carry the CDSC and, in the case of Class B Shares, the
automatic conversion schedule of the fund from which the exchange is made. The
holding period of the Class B Shares of the Fund acquired by exchange will be
added to that of the shares that were exchanged for purposes of determining the
time of the automatic conversion into Class A Shares of the Fund.
Permissible exchanges into Class A Shares of the Fund will be made
without a front-end sales charge imposed by the Fund, except for exchanges from
funds not subject to a front-end sales charge (unless such shares were acquired
in an exchange from a fund subject to such a charge or such shares were
acquired through the reinvestment of dividends). Permissible exchanges into
Class B Shares or Class C Shares of the Fund will be made without the
imposition of a CDSC by the fund from which the exchange is being made at the
time of the exchange.
See Allied Plans under Retirement Planning for information on
exchanges by participants in an Allied Plan.
ADDITIONAL METHODS OF ADDING TO YOUR INVESTMENT
Call the Shareholder Service Center for more information if you wish
to use the following services:
1. Direct Deposit
YOU MAY HAVE YOUR EMPLOYER OR BANK MAKE REGULAR INVESTMENTS DIRECTLY
TO YOUR ACCOUNT FOR YOU (for example: payroll deduction, pay by phone, annuity
payments). The Fund also accepts preauthorized recurring government and
private payments by Electronic Fund Transfer, which avoids mail time and check
clearing holds on payments such as social security, federal salaries, Railroad
Retirement benefits, etc.
2. Automatic Investing Plan
THE AUTOMATIC INVESTING PLAN ENABLES YOU TO MAKE REGULAR MONTHLY
INVESTMENTS WITHOUT WRITING OR MAILING CHECKS. You may authorize the Fund to
transfer a designated amount monthly from your checking account to your Fund
account. Many shareholders use this as an automatic savings plan.
Shareholders should allow a reasonable amount of time for initial purchases and
changes to these plans to become effective.
This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans.
* * *
Should investments by these two methods be reclaimed or returned for
some reason, the Fund has the right to liquidate your shares to reimburse the
government or transmitting bank. If there are insufficient funds in your Class
account, you are obligated to reimburse the Fund.
PURCHASE PRICE AND EFFECTIVE DATE
The offering price and net asset value of the Class A, Class B and
Class C Shares are determined as of the close of regular trading on the New
York Stock Exchange (ordinarily, 4 p.m., Eastern time) on days when the
Exchange is open.
The effective date of a purchase made through an investment dealer
is the date the order is received by the Fund. The effective date of a direct
purchase is the day your wire, electronic transfer or check is received unless
it is received after the time the offering price or net asset value of shares
is determined, as noted above. Purchase orders received after such time will
be effective the next business day.
THE CONDITIONS OF YOUR PURCHASE
The Fund reserves the right to reject any purchase order. If a
purchase is canceled because your check is returned unpaid, you are responsible
for any loss incurred. The Fund can redeem shares from your account(s) to
reimburse itself for any loss, and you may be restricted from making future
purchases in any of the funds in the Delaware Group. The Fund reserves the
right to reject purchase orders paid by third-party checks or checks that are
not drawn on a domestic branch of a United States financial institution. If
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<PAGE> 31
(DTF-ABC)
a check drawn on a foreign financial institution is accepted, you may be
subject to additional bank charges for clearance and currency conversion.
The Fund also reserves the right, following shareholder
notification, to charge a service fee on non-retirement accounts that have
remained below the minimum stated account balance for a period of three or more
consecutive months. Holders of such accounts may be notified of their
insufficient account balance and advised that they have until the end of the
current calendar quarter to raise their balance to the stated minimum. If the
account has not reached the minimum balance requirement by that time, the Fund
will charge a $9 fee for that quarter and each subsequent calendar quarter
until the account is brought up to the minimum balance. The service fee will
be deducted from the account during the first week of each calendar quarter for
the previous quarter, and will be used to help defray the cost of maintaining
low-balance accounts. No fees will be charged without proper notice, and no
CDSC will apply to such assessments.
The Fund also reserves the right, upon sixty days' written notice,
to redeem accounts that remain under a Class' minimum initial purchase amount
as a result of redemptions. An investor making the minimum initial investment
may be subject to involuntary redemption without the imposition of a CDSC or
Limited CDSC if he or she redeems any portion of his or her account.
REDEMPTION AND EXCHANGE
YOU CAN REDEEM OR EXCHANGE YOUR SHARES IN A NUMBER OF DIFFERENT
WAYS. The exchange service is useful if your investment requirements change
and you want an easy way to invest in other equity funds, tax-advantaged funds,
bond funds or money market funds. This service is also useful if you are
anticipating a major expenditure and want to move a portion of your investment
into a fund that has the checkwriting feature. Exchanges are subject to the
requirements of each fund and all exchanges of shares from one fund or class to
another constitute taxable events. See Taxes. Further, in order for an
exchange to be processed, shares of the fund being acquired must be registered
in the state where the acquiring shareholder resides. You may want to consult
your financial adviser or investment dealer to discuss which funds in the
Delaware Group will best meet your changing objectives, and the consequences of
any exchange transaction. You may also call the Delaware Group directly for
fund information.
Your shares will be redeemed or exchanged at a price based on the
net asset value next determined after we receive your request in good order
subject in the case of a redemption, to any applicable CDSC or Limited CDSC.
Redemption or exchange requests received in good order after the time the
offering price and net asset value of shares are determined, as noted above,
will be processed on the next business day. See Purchase Price and Effective
Date under Buying Shares. A shareholder submitting a redemption may indicate
that he or she wishes to receive redemption proceeds of a specific dollar
amount. In the case of such a request, and in the case of certain redemptions
from retirement plan accounts, the Fund will redeem the number of shares
necessary to deduct the applicable CDSC in the case of Class B Shares or Class
C Shares or, if applicable, the Limited CDSC in the case of Class A Shares and
tender to the shareholder the requested amount assuming the shareholder holds
enough shares in his or her account for the redemption to be processed in this
manner. Otherwise, the amount tendered to the shareholder upon redemption will
be reduced by the amount of the applicable CDSC or Limited CDSC.
Except as noted below, for a redemption request to be in "good
order," you must provide your account number, account registration, and the
total number of shares or dollar amount of the transaction. For exchange
requests, you must also provide the name of the fund you want to receive the
proceeds. Exchange instructions and redemption requests must be signed by the
record owner(s) exactly as the shares are registered. You may request a
redemption or an exchange by calling the Fund at 800-523-1918 (in Philadelphia,
215-988-1241). The Fund may suspend, terminate, or amend the terms of, the
exchange privilege upon sixty days' written notice to shareholders.
The Fund will honor written redemption requests of shareholders who
recently purchased shares by check, but will not mail the proceeds until it is
reasonably satisfied that the purchase check has cleared, which may take up to
fifteen days from the purchase date. The Fund will not honor telephone
redemptions for shares recently
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(DTF-ABC)
purchased by check unless it is reasonably satisfied that the purchase check
has cleared. You can avoid this potential delay if you purchase shares by
wiring Federal Funds. The Fund reserves the right to reject a written or
telephone redemption request or delay payment of redemption proceeds if there
has been a recent change to the shareholder's address of record.
There is no front-end sales charge or fee for exchanges made between
shares of funds which both carry a front-end sales charge. Any applicable
front-end sales charge will apply to exchanges from shares of funds not subject
to a front-end sales charge, except for transfers involving assets that were
previously invested in a fund with a front-end sales charge and/or transfers
involving the reinvestment of dividends.
Holders of Class B Shares or Class C Shares that exchange their
shares ("Original Shares") for Class B shares of other Class B Funds or Class C
shares of other Class C Funds, as applicable (in each case, "New Shares"), will
not be subject to a CDSC that might otherwise be due upon redemption of the
Original Shares. However, such shareholders will continue to be subject to the
CDSC and, in the case of Class B Shares, the automatic conversion schedule of
the Original Shares as described in this Prospectus and any CDSC assessed upon
redemption will be charged by the Fund. In an exchange of Class B Shares, the
Fund's CDSC schedule may be higher than the CDSC schedule relating to the New
Shares acquired as a result of the exchange. For purposes of computing the
CDSC that may be payable upon a disposition of the New Shares, the period of
time that an investor held the Original Shares is added to the period of time
that an investor held the New Shares. With respect to Class B Shares, the
automatic conversion schedule of the Original Shares may be longer than that of
the New Shares. Consequently, an investment in New Shares by exchange may
subject an investor to the higher 12b-1 fees applicable to Class B Shares of
the Fund for a longer period of time than if the investment in New Shares were
made directly.
Various redemption and exchange methods are outlined below. Except
for the CDSC applicable to certain redemptions of Class B and Class C Shares
and the Limited CDSC applicable to certain redemptions of Class A Shares
purchased at net asset value, there is no fee charged by the Fund or the
Distributor for redeeming or exchanging your shares, but such fees could be
charged in the future. You may have your investment dealer arrange to have
your shares redeemed or exchanged. Your investment dealer may charge for this
service.
All authorizations given by shareholders, including selection of
any of the features described below, shall continue in effect until such time
as a written revocation or modification has been received by the Fund or its
agent.
All exchanges involve a purchase of shares of the fund into which
the exchange is made. As with any purchase, an investor should obtain and
carefully read that fund's prospectus before buying shares in an exchange. The
prospectus contains more complete information about the fund, including charges
and expenses.
WRITTEN REDEMPTION
You can write to the Fund at 1818 Market Street, Philadelphia, PA
19103 to redeem some or all of your shares. The request must be signed by all
owners of the account or your investment dealer of record. For redemptions of
more than $50,000, or when the proceeds are not sent to the shareholder(s) at
the address of record, the Fund requires a signature by all owners of the
account and a signature guarantee for each owner. Each signature guarantee
must be supplied by an eligible guarantor institution. The Fund reserves the
right to reject a signature guarantee supplied by an eligible institution based
on its creditworthiness. The Fund may require further documentation from
corporations, executors, retirement plans, administrators, trustees or
guardians.
Payment is normally mailed the next business day, but no later than
seven days, after receipt of your redemption request. If your Class A Shares
are in certificate form, the certificate must accompany your request and also
be in good order. The Fund issues certificates for Class A Shares only if a
shareholder submits a specific request. The Fund does not issue certificates
for Class B Shares or Class C Shares.
WRITTEN EXCHANGE
You may also write to the Fund (at 1818 Market Street, Philadelphia,
PA 19103) to request
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an exchange of any or all of your shares into another mutual fund in the
Delaware Group, subject to the same conditions and limitations as other
exchanges noted above.
TELEPHONE REDEMPTION AND EXCHANGE
To get the added convenience of the telephone redemption and
exchange methods, you must have the Transfer Agent hold your shares (without
charge) for you. If you choose to have your Class A Shares in certificate
form, you may only redeem or exchange by written request and you must return
your certificates.
The Telephone Redemption - Check to Your Address of Record service
and the Telephone Exchange service, both of which are described below, are
automatically provided unless you notify the Fund in writing that you do not
wish to have such services available with respect to your account. The Fund
reserves the right to modify, terminate or suspend these procedures upon sixty
days' written notice to shareholders. It may be difficult to reach the Fund by
telephone during periods when market or economic conditions lead to an
unusually large volume of telephone requests.
Neither the Fund nor the Transfer Agent is responsible for any
shareholder loss incurred in acting upon written or telephone instructions for
redemption or exchange of Fund shares which are reasonably believed to be
genuine. With respect to such telephone transactions, the Fund will follow
reasonable procedures to confirm that instructions communicated by telephone
are genuine (including verification of a form of personal identification) as,
if it does not, the Fund or the Transfer Agent may be liable for any losses due
to unauthorized or fraudulent transactions. Instructions received by telephone
are generally tape recorded, and a written confirmation will be provided for
all purchase, exchange and redemption transactions initiated by telephone. By
exchanging shares by telephone, you are acknowledging prior receipt of a
prospectus for the fund into which your shares are being exchanged.
TELEPHONE REDEMPTION - CHECK TO YOUR ADDRESS OF RECORD
THE TELEPHONE REDEMPTION FEATURE IS A QUICK AND EASY METHOD TO
REDEEM SHARES. You or your investment dealer of record can have redemption
proceeds of $50,000 or less mailed to you at your address of record. Checks
will be payable to the shareholder(s) of record. Payment is normally mailed
the next business day, but no more than seven days, after receipt of the
request. This service is only available to individual, joint and individual
fiduciary-type accounts.
TELEPHONE REDEMPTION - PROCEEDS TO YOUR BANK
Redemption proceeds of $1,000 or more can be transferred to your
predesignated bank account by wire or by check. You should authorize this
service when you open your account. If you change your predesignated bank
account, the Fund requires an Authorization Form with your signature
guaranteed. For your protection, your authorization must be on file. If you
request a wire, your funds will normally be sent the next business day.
CoreStates Bank, N.A.'s fee (currently $7.50) will be deducted from your
redemption. If you ask for a check, it will normally be mailed the next
business day, but no later than seven days, after receipt of your request to
your predesignated bank account. Except for any CDSC which may be applicable
to Class B and Class C Shares and the Limited CDSC which may be applicable to
certain Class A Shares, there are no fees for this redemption method, but the
mail time may delay getting funds into your bank account. Simply call the
Fund's Shareholder Service Center prior to the time the offering price and net
asset value are determined, as noted above.
If expedited payment by check or wire could adversely affect the
Fund, the Fund may take up to seven days to pay.
TELEPHONE EXCHANGE
The Telephone Exchange feature is a convenient and efficient way to
adjust your investment holdings as your liquidity requirements and investment
objectives change. You or your investment dealer of record can exchange your
shares into any fund in the Delaware Group under the same registration, subject
to the same conditions and limitations as other exchanges
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(DTF-ABC)
noted above. As with the written exchange service, telephone exchanges are
subject to the requirements of each fund, as described above. Telephone
exchanges may be subject to limitations as to amounts or frequency.
SYSTEMATIC WITHDRAWAL PLANS
1. Regular Plans
This plan provides shareholders with a consistent monthly (or
quarterly) payment. THIS IS PARTICULARLY USEFUL TO SHAREHOLDERS LIVING ON
FIXED INCOMES, SINCE IT CAN PROVIDE THEM WITH A STABLE SUPPLEMENTAL AMOUNT.
With accounts of at least $5,000, you may elect monthly withdrawals of $25
(quarterly $75) or more. The Fund does not recommend any particular monthly
amount, as each shareholder's situation and needs vary. Payments are normally
made by check. You may elect to have your payments transferred from your Fund
account to your predesignated bank account through the Delaware Group's
MoneyLine service. Your funds will normally be credited to your bank account
two business days after the payment date. Except for the Limited CDSC which
may be applicable to Class A Shares and the CDSC which may be applicable to
Class B and Class C Shares as noted below, there are no fees for this
redemption method. You can initiate the MoneyLine service by completing an
Authorization Agreement. If the name and address on your bank account are not
identical to the name and address on your Fund account, you must have your
signature guaranteed. Please call the Shareholder Service Center for
additional information.
2. Retirement Plans
For shareholders eligible under the applicable retirement plan to
receive benefits in periodic payments, the Fund's Systematic Withdrawal Plan
provides you with maximum flexibility. A number of formulas are available for
calculating your withdrawals, depending upon whether the distributions are
required or optional. Withdrawals must be for $25 or more; however, no minimum
account balance is required. The MoneyLine Service is not available for
retirement plans.
* * *
Shareholders should not purchase Class A Shares while participating
in a Systematic Withdrawal Plan. Also, redemptions of Class A Shares via a
Systematic Withdrawal Plan may be subject to a Limited CDSC if the original
purchase was made at net asset value within the twelve months prior to the
withdrawal at net asset value and a dealer's commission has been paid on that
purchase. See Contingent Deferred Sales Charge for Certain Purchases of Class
A Shares Made at Net Asset Value, below.
With respect to Class B Shares and Class C Shares redeemed via a
Systematic Withdrawal Plan, any applicable CDSC will be waived if, on the date
that the Plan is established, the annual amount selected to be withdrawn is
less than 12% of the account balance. If the annual amount selected to be
withdrawn exceeds 12% of the account balance on the date that the Systematic
Withdrawal Plan is established, all redemptions under the Plan will be subject
to the applicable CDSC. Whether a waiver of the CDSC is available or not, the
first shares to be redeemed for each Systematic Withdrawal Plan payment will be
those not subject to a CDSC because they have either satisfied the required
holding period or were acquired through the reinvestment of distributions. The
12% annual limit will be reset on the date that any Systematic Withdrawal Plan
is modified (for example, a change in the amount selected to be withdrawn or
the frequency or date of withdrawals), based on the balance in the account on
that date. See Waiver of CDSC - Class B and Class C Shares, below.
For more information on Systematic Withdrawal Plans, call the
Shareholder Service Center.
WEALTH BUILDER OPTION
Shareholders may elect to invest in other mutual funds in the
Delaware Group through our Wealth Builder Option. Under this automatic
exchange program, shareholders can authorize regular monthly amounts (minimum
of $100 per fund) to be liquidated from their account and invested
automatically into an account in one or more funds in the Delaware Group. If,
in connection with the Wealth Builder Option, a
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shareholder wishes to open a new account in such other fund or funds to receive
the automatic investment, such new account must meet such other fund's minimum
initial purchase requirement. Investments under this option are exchanges and
are therefore subject to the same conditions and limitations as other exchanges
noted above.
Shareholders can use the Wealth Builder Option to invest in the Fund
through regular liquidations of shares in their accounts in other funds in the
Delaware Group, subject to the same conditions and limitations as other
exchanges noted above. Shareholders can terminate their participation at any
time by written notice to the Fund. See Redemption and Exchange.
This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans.
CONTINGENT DEFERRED SALES CHARGE FOR CERTAIN PURCHASES OF CLASS A SHARES MADE
AT NET ASSET VALUE
A Limited CDSC will be imposed by the Fund upon certain redemptions
of Class A Shares (or shares into which such Class A Shares are exchanged) made
within twelve months of purchase, if such purchases were made at net asset
value and triggered the payment by the Distributor of the dealer's commission
described above. See Buying Shares.
The Limited CDSC will be paid to the Distributor and will be equal
to the lesser of 1% of (1) the net asset value at the time of purchase of the
Class A Shares being redeemed or (2) the net asset value of such Class A Shares
at the time of redemption. For purposes of this formula, the "net asset value
at the time of purchase" will be the net asset value at purchase of the Class A
Shares even if those shares are later exchanged for shares of another Delaware
Group fund and, in the event of an exchange of Class A Shares, the "net asset
value of such shares at the time of redemption" will be the net asset value of
the shares acquired in the exchange.
Redemptions of such Class A Shares held for more than twelve months
will not be subjected to the Limited CDSC and an exchange of such Class A
Shares into another Delaware Group fund will not trigger the imposition of the
Limited CDSC at the time of such exchange. The period a shareholder owns
shares into which Class A Shares are exchanged will count towards satisfying
the 12-month holding period. The Fund assesses the Limited CDSC if such
12-month period is not satisfied irrespective of whether the redemption
triggering its payment is of the Class A Shares of the Fund or the Class A
Shares acquired in the exchange.
In determining whether a Limited CDSC is payable, it will be assumed
that shares not subject to the Limited CDSC are the first redeemed followed by
other shares held for the longest period of time. The Limited CDSC will not be
imposed upon shares representing reinvested dividends or capital gains
distributions, or upon amounts representing share appreciation. All
investments made during a calendar month, regardless of what day of the month
the investment occurred, will age one month on the last day of that month and
each subsequent month.
WAIVER OF LIMITED CDSC - CLASS A SHARES
The Limited CDSC for Class A Shares on which a dealer's commission
has been paid will be waived in the following instances: (i) redemptions that
result from the Fund's right to liquidate a shareholder's account if the
aggregate net asset value of the shares held in the account is less than the
then-effective minimum account size; (ii) distributions to participants from a
retirement plan qualified under section 401(a) or 401(k) of the Internal
Revenue Code of 1986, as amended ("the Code"), or due to death of a participant
in such a plan; (iii) redemptions pursuant to the direction of a participant or
beneficiary of a retirement plan qualified under section 401(a) or 401(k) of
the Code with respect to that retirement plan; (iv) distributions from a
section 403(b)(7) Plan or an IRA due to death, disability, or attainment of age
59 1/2; (v) returns of excess contributions to an IRA; (vi) distributions by
other employee benefit plans to pay benefits; (vii) distributions described in
(ii), (iv), and (vi) above pursuant to a systematic withdrawal plan; and (viii)
redemptions by the classes of shareholders who are permitted to purchase shares
at net asset value, regardless of the size of the purchase (see Buying at Net
Asset Value under Buying Shares).
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(DTF-ABC)
WAIVER OF CDSC - CLASS B AND CLASS C SHARES
The CDSC on certain redemptions of Class B Shares is waived in
connection with the following redemptions: (i) redemptions that result from
the Fund's right to liquidate a shareholder's account if the aggregate net
asset value of the shares held in the account is less than the then-effective
minimum account size; (ii) returns of excess contributions to an IRA or
403(b)(7) Deferred Compensation Plan; (iii) required minimum distributions from
an IRA, 403(b)(7) Deferred Compensation Plan, or 457 Deferred Compensation
Plan; and (iv) distributions from an account if the redemption results from the
death of all registered owners of the account (in the case of accounts
established under the Uniform Gifts to Minors or Uniform Transfers to Minors
Acts or trust accounts, the waiver applies upon the death of all beneficial
owners) or a total and permanent disability (as defined in Section 72 of the
Code) of all registered owners occurring after the purchase of the shares being
redeemed.
The CDSC on certain redemptions of Class C Shares is waived in
connection with the following redemptions: (i) redemptions that result from
the Fund's right to liquidate a shareholder's account if the aggregate net
asset value of the shares held in the account is less than the then-effective
minimum account size; (ii) returns of excess contributions to an IRA, 403(b)(7)
Deferred Compensation Plan, Profit Sharing Plan, Money Purchase Pension Plan or
401(k) Defined Contribution Plan; (iii) required minimum distributions from an
IRA, 403(b)(7) Deferred Compensation Plan, 457 Deferred Compensation Plan,
Profit Sharing Plan, Money Purchase Pension Plan, or 401(k) Defined
Contribution Plan; (iv) distributions from a 403(b)(7) Deferred Compensation
Plan, 457 Deferred Compensation Plan, Profit Sharing Plan, or 401(k) Defined
Contribution Plan, under hardship provisions of the plan; (v) distributions
from a 403(b)(7) Deferred Compensation Plan, 457 Deferred Compensation Plan,
Profit Sharing Plan, Money Purchase Pension Plan or a 401(k) Defined
Contribution Plan upon attainment of normal retirement age under the plan or
upon separation from service; (vi) distributions from an IRA on or after
attainment of age 59 1/2; and (vii) distributions from an account if the
redemption results from the death of all registered owners of the account (in
the case of accounts established under the Uniform Gifts to Minors or Uniform
Transfers to Minors Acts or trust accounts, the waiver applies upon the death
of all beneficial owners) or a total and permanent disability (as defined in
Section 72 of the Code) of all registered owners occurring after the purchase
of the shares being redeemed.
In addition, the CDSC will be waived on Class B and Class C Shares
redeemed in accordance with a Systematic Withdrawal Plan if the annual amount
selected to be withdrawn under the Plan does not exceed 12% of the value of the
account on the date that the Systematic Withdrawal Plan was established or
modified.
DIVIDENDS AND DISTRIBUTIONS
The Fund will make payments from net investment income and net
realized securities profits, if any, twice a year. The first payment would be
made during the first quarter of the next fiscal year. The second payment
would be made near the end of the calendar year if necessary to comply with
certain requirements of the Internal Revenue Code. During the fiscal year
ended June 30, 1995, distributions totaling $0.79 per share of the Class A
Shares were paid from realized securities profits. On August 7, 1995, a
distribution of $0.55 per share of the Class A Shares and the Class B Shares
was paid from realized securities profits to shareholders of record July 28,
1995. Class C Shares were not offered prior to the date of this Prospectus.
Each of the Classes will share proportionately in the investment
income and expenses of the Fund, except that the per share dividends from net
investment income on the Class A Shares, Class B Shares and Class C Shares will
vary due to the expenses under the 12b-1 Plan applicable to each Class.
Generally, the dividends per share on Class B Shares and Class C Shares can be
expected to be lower than the dividends per share on Class A Shares because the
expenses under the 12b-1 Plans relating to Class B and Class C Shares will be
higher than the expenses under the 12b-1 Plan relating to Class A Shares. See
Distribution (12b-1) and Service under Management of the Fund.
Both dividends and distributions, if any, are automatically
reinvested in your account at net asset value unless you elect otherwise. Any
check in payment of dividends or other
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(DTF-ABC)
distributions which cannot be delivered by the United States Post Office or
which remains uncashed for a period of more than one year may be reinvested in
the shareholder's account at the then-current net asset value and the dividend
option may be changed from cash to reinvest. If you elect to take your
dividends and distributions in cash and such dividends and distributions are in
an amount of $25 or more, you may choose Delaware Group's MoneyLine service and
have such payments transferred from your Fund account to your predesignated
bank account. Your funds will normally be credited to your bank account two
business days after the payment date. There are no fees for the MoneyLine
service. See Systematic Withdrawal Plan for Class A Shares, Class B Shares and
Class C Shares under Redemption and Exchange for information regarding
authorization of this service. This service is not available for retirement
plans. See The Delaware Difference for more information on reinvestment
options.
TAXES
The Fund has qualified, and intends to continue to qualify, as a
regulated investment company under Subchapter M of the Code. As such, the Fund
will not be subject to federal income tax, or to any excise tax, to the extent
its earnings are distributed as provided in the Code.
The Fund intends to distribute substantially all of its net
investment income and net capital gains, if any. Dividends from net investment
income or net short-term capital gains will be taxable to you as ordinary
income, whether received in cash or in additional shares. For corporate
investors, dividends from net investment income will generally qualify in part
for the corporate dividends-received deduction. The portion of dividends paid
by the Fund that so qualifies will be designated each year in a notice mailed
to the Fund's shareholders.
Distributions paid by the Fund from long-term capital gains, whether
received in cash or in additional shares, are taxable to those investors who
are subject to income taxes as long-term capital gains, regardless of the
length of time an investor has owned shares in the Fund. The Fund does not
seek to realize any particular amount of capital gains during a year; rather,
realized gains are a byproduct of Fund management activities. Consequently,
capital gains distributions may be expected to vary considerably from year to
year. Also, for those investors subject to tax, if purchases of shares in the
Fund are made shortly before the record date for a dividend or capital gains
distribution, a portion of the investment will be returned as a taxable
distribution.
Although dividends generally will be treated as distributed when
paid, dividends which are declared in October, November, or December to
shareholders of record on a specified date in one of those months, but which,
for operational reasons, may not be paid to the shareholder until the following
January, will be treated for tax purposes as if paid by the Fund and received
by the shareholder on December 31 of the year declared.
The sale of shares of the Fund is a taxable event and may result in
a capital gain or loss to shareholders subject to tax. Capital gain or loss
may be realized from an ordinary redemption of shares or an exchange of shares
between two mutual funds (or two series or portfolios of a mutual fund). Any
loss incurred on sale or exchange of the Fund's shares which had been held for
six months or less will be treated as a long-term capital loss to the extent of
capital gain dividends received with respect to such shares. All or a portion
of the sales charge incurred in acquiring Fund shares will be excluded from the
federal tax basis of any of such shares sold or exchanged within ninety days of
their purchase (for purposes of determining gain or loss upon sale of such
shares) if the sale proceeds are reinvested in the Fund or in another fund in
the Delaware Group of funds and a sales charge that would otherwise apply to
the reinvestment is reduced or eliminated. Any portion of such sales charge
excluded from the tax basis of the shares sold will be added to the tax basis
of the shares acquired in the reinvestment.
The automatic conversion of Class B Shares into Class A Shares at
the end of approximately eight years after purchase will be tax-free for
federal tax purposes. See Automatic Conversion of Class B Shares under Buying
Shares.
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(DTF-ABC)
In addition to federal taxes, shareholders may be subject to state
and local taxes on distributions. Distributions of interest income and capital
gains realized from certain types of U.S. Government securities may be exempt
from state personal income taxes. Shares of the Fund are exempt from
Pennsylvania county personal property taxes.
Each year, the Fund will mail to you information on the tax status
of the Fund's dividends and distributions. Shareholders will also receive each
year information as to the portion of dividend income, if any, that is derived
from U.S. Government securities that are exempt from state income tax. Of
course, shareholders who are not subject to tax on their income would not be
required to pay tax on amounts distributed to them by the Fund.
The Fund is required to withhold 31% of taxable dividends, capital
gains distributions, and redemptions paid to shareholders who have not complied
with IRS taxpayer identification regulations. You may avoid this withholding
requirement by certifying on your Account Registration Form your proper
Taxpayer Identification Number and by certifying that you are not subject to
backup withholding.
The tax discussion set forth above is included for general
information only. Investors should consult their own tax advisers concerning
the federal, state, local or foreign tax consequences of an investment in the
Fund.
See Taxes in Part B for additional information on tax matters
relating to the Fund and its shareholders.
CALCULATION OF OFFERING PRICE AND NET ASSET VALUE PER SHARE
Class A Shares are purchased at the offering price per share, while
Class B Shares and Class C Shares are purchased at the net asset value ("NAV")
per share. The offering price per share of Class A Shares consists of the NAV
per share next computed after the order is received, plus any applicable
front-end sales charges. The offering price and NAV are computed as of the
close of regular trading on the New York Stock Exchange (ordinarily, 4 p.m.,
Eastern time) on days when the Exchange is open.
The NAV per share is computed by adding the value of all securities
and other assets in the portfolio, deducting any liabilities (expenses and fees
are accrued daily) and dividing by the number of shares outstanding. Portfolio
securities for which market quotations are available are priced at market
value. Short-term investments having a maturity of less than sixty days are
valued at amortized cost, which approximates market value. All other
securities are valued at their fair value as determined in good faith and in a
method approved by the Fund's Board of Directors.
Each of the Fund's four classes will bear, pro-rata, all of the
common expenses of the Fund. The net asset values of all outstanding shares of
each class of the Fund will be computed on a pro-rata basis for each
outstanding share based on the proportionate participation in the Fund
represented by the value of shares of that class. All income earned and
expenses incurred by the Fund will be borne on a pro-rata basis by each
outstanding share of a class, based on each class' percentage in the Fund
represented by the value of shares of such classes, except that the Trend Fund
Institutional Class will not incur any of the expenses under the Fund's 12b-1
Plans and the Class A, Class B and Class C Shares alone will bear the 12b-1
Plan expenses payable under their respective 12b-1 Plans. Due to the specific
distribution expenses and other costs that will be allocable to each class, the
net asset value of each class of the Fund will vary.
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(DTF-ABC)
MANAGEMENT OF THE FUND
DIRECTORS
The business and affairs of the Fund are managed under the direction
of its Board of Directors. Part B contains additional information regarding
the directors and officers.
INVESTMENT MANAGER
The Manager furnishes investment management services to the Fund.
The Manager and its predecessors have been managing the funds in the Delaware
Group since 1938. On June 30, 1995, the Manager and its affiliate, Delaware
International Advisers Ltd., were supervising in the aggregate more than $26
billion in assets in the various institutional (approximately $16,227,892,000)
and investment company (approximately $9,916,645,000) accounts.
The Manager is an indirect, wholly-owned subsidiary of Delaware
Management Holdings, Inc. ("DMH"). On April 3, 1995, a merger between DMH and
a wholly-owned subsidiary of Lincoln National Corporation ("Lincoln National")
was completed. DMH and the Manager are now wholly-owned subsidiaries and
subject to the ultimate control, of Lincoln National. Lincoln National, with
headquarters in Fort Wayne, Indiana, is a diversified organization with
operations in many aspects of the financial services industry, including
insurance and investment management. In connection with the merger, a new
Investment Management Agreement between the Fund and the Manager was executed
following shareholder approval.
The Manager manages the Fund's portfolio and makes investment
decisions which are implemented by the Fund's Trading Department. The Manager
also administers the Fund's affairs and pays the salaries of all the directors,
officers and employees of the Fund who are affiliated with the Manager. For
these services, the Manager is paid an annual fee of 3/4 of 1% of the average
daily net assets of the Fund, less all directors' fees paid to unaffiliated
directors. This fee was paid by the Fund during the last fiscal year. This
fee is higher than that paid by many other funds and may be higher or lower
than that paid by funds with comparable investment objectives. Investment
management fees paid by the Fund for the fiscal year ended June 30, 1995 were
0.75% of average daily net assets.
Edward N. Antoian has primary responsibility for making day-to-day
investment decisions for the Fund. He has been the Fund's senior portfolio
manager since 1984. A graduate of The State University of New York at Albany
with an MBA in Finance from the University of Pennsylvania's Wharton School,
Mr. Antoian began his career with Price Waterhouse. Prior to joining the
Delaware Group in June 1984, he worked in the Institutional Equity Department
of E.F. Hutton in Philadelphia. A Chartered Financial Analyst, Mr. Antoian is
a member of the Philadelphia Finance Association and the Philadelphia
Securities Association.
In making investment decisions for the Fund, Mr. Antoian regularly
consults with Wayne A. Stork, William H. Miller and other members of Delaware's
equity department. Mr. Stork, Chairman of the Manager and the Fund's Board of
Directors, is a graduate of Brown University and attended New York University's
Graduate School of Business Administration. Mr. Miller is an Assistant
Portfolio Manager. He holds a BA in Economics from Trinity College. Prior to
joining the Delaware Group in 1995, he worked as a technology analyst for
Janney Montgomery Scott in Philadelphia and he has also served as an
institutional salesman for Rutherford Brown & Catherwood.
-34-
<PAGE> 40
(DTF-ABC)
PORTFOLIO TRADING PRACTICES
The Fund normally will not invest for short-term trading purposes.
However, the Fund may sell securities without regard to the length of time they
have been held. The degree of portfolio activity will affect brokerage costs
of the Fund and may affect taxes payable by the Fund's shareholders to the
extent that net capital gains are realized. Given the Fund's investment
objective, its annual portfolio turnover rate may exceed 100%. A turnover rate
of 100% would occur if all the investments in the Fund's portfolio at the
beginning of the year were replaced by the end of the year. The turnover rate
also may be affected by cash requirements for redemptions and repurchases of
Fund shares. During the past two fiscal years, the Fund's portfolio turnover
rates were 67% for 1994 and 64% for 1995.
The Fund uses its best efforts to obtain the best available price
and most favorable execution for portfolio transactions. Orders may be placed
with brokers or dealers who provide brokerage and research services to the
Manager or its advisory clients. These services may be used by the Manager in
servicing any of its accounts. Subject to best price and execution, the Fund
may consider a broker/dealer's sales of Fund shares in placing portfolio orders
and may place orders with broker/dealers that have agreed to defray certain
Fund expenses such as custodian fees.
PERFORMANCE INFORMATION
From time to time, the Fund may quote total return performance of
the Classes in advertising and other types of literature. Total return will be
based on a hypothetical $1,000 investment, reflecting the reinvestment of all
distributions at net asset value and (i) in the case of Class A Shares, the
impact of the maximum front-end sales charge at the beginning of each specified
period and (ii) in the case of Class B Shares and Class C Shares, the deduction
of any applicable CDSC at the end of the relevant period. Each presentation
will include the average annual total return for one-, five- and ten-year
periods, as relevant. The Fund may also advertise aggregate and average total
return information concerning a Class over additional periods of time. In
addition, the Fund may present total return information that does not reflect
the deduction of the maximum front-end sales charge or any applicable CDSC. In
this case, such total return information would be more favorable than total
return information which includes deductions of the maximum front-end sales
charge or any applicable CDSC.
Because stock prices fluctuate, investment results of the Classes
will fluctuate over time and past performance should not be considered as a
representation of future results.
DISTRIBUTION (12b-1) AND SERVICE
The Distributor, Delaware Distributors, L.P. (which formerly
conducted business as Delaware Distributors, Inc.), serves as the national
distributor for the Fund under a Distribution Agreement dated April 3, 1995 as
amended on November 29, 1995.
The Fund has adopted a separate distribution plan under Rule 12b-1
for each of the Class A Shares, Class B Shares and Class C Shares (the
"Plans"). The Plans permit the Fund to pay the Distributor from the assets of
the respective Classes a monthly fee for its services and expenses in
distributing and promoting sales of shares. These expenses include, among
other things, preparing and distributing advertisements, sales literature, and
prospectuses and reports used for sales purposes, compensating sales and
marketing personnel, holding special promotions for specified periods of time,
and paying distribution and maintenance fees to brokers, dealers and others.
In connection with the promotion of Class A, Class B Shares and Class C, the
Distributor may, from time to time, pay to participate in dealer-sponsored
seminars and conferences, and reimburse dealers for expenses incurred in
connection with
-35-
<PAGE> 41
(DTF-ABC)
preapproved seminars, conferences and advertising. The Distributor may pay or
allow additional promotional incentives to dealers as part of preapproved sales
contests and/or to dealers who provide extra training and information
concerning a Class and increase sales of the Class. In addition, the Fund may
make payments from the assets of the respective Class directly to others, such
as banks, who aid in the distribution of Class shares or provide services in
respect of a Class, pursuant to service agreements with the Fund.
The Plan expenses relating to each of the Class B Shares and the
Class C Shares are also used to pay the Distributor for advancing the
commission costs to dealers with respect to the initial sale of such shares.
The aggregate fees paid by the Fund from the assets of the
respective Classes to the Distributor and others under the Plans may not exceed
.30% of the Class A Shares' average daily net assets in any year, and 1% (.25%
of which are service fees to be paid to the Distributor, dealers or others, for
providing personal service and/or maintaining shareholder accounts) of each of
the Class B Shares' and Class C Shares' average daily net assets in any year.
The Class A, Class B and Class C Shares will not incur any distribution
expenses beyond these limits, which may not be increased without shareholder
approval. The Distributor may, however, incur additional expenses and make
additional payments to dealers from its own resources to promote the
distribution of shares of the Classes.
Effective June 1, 1992, the Board of Directors has determined that
the annual fee payable on a monthly basis, under the Plan relating to the Class
A Shares, will be equal to the sum of (i) the amount obtained by multiplying
.30% by the average daily net assets represented by shares of the Class A
Shares that are acquired by shareholders on or after June 1, 1992, and (ii) the
amount obtained by multiplying .10% by the average daily net assets represented
by shares of the Class A Shares that were acquired before June 1, 1992. While
this is the method for calculating the Class A Shares' 12b-1 fee, the fee is a
Class expense so that all shareholders, regardless of when they purchase their
shares, will bear 12b-1 expenses at the same per share rate. As Class A Shares
are sold on or after June 1, 1992, the initial rate of at least .10% will
increase over time. Thus, as the proportion of Class A Shares purchased on or
after June 1, 1992, to Class A Shares outstanding prior to June 1, 1992,
increases, the expenses attributable to payments under the Plan will also
increase (but will not exceed .30% of average daily net assets). While this
describes the current formula for calculating the fees which will be payable
under the Plan, such Plan permits a full .30% on all Class A Shares' assets to
be paid at any time following Board approval.
The Fund's Plans do not apply to the Trend Fund Institutional Class
of shares. Those shares are not included in calculating the Plans' fees, and
the Plans are not used to assist in the distribution and marketing of Trend
Fund Institutional Class shares.
While payments pursuant to the Plans may not exceed .30% annually
with respect to the Class A Shares and 1% annually with respect to each of the
Class B Shares and Class C Shares, the Plans do not limit fees to amounts
actually expended by the Distributor. It is therefore possible that the
Distributor may realize a profit in any particular year. However, the
Distributor currently expects that its distribution expenses will likely equal
or exceed payments to it under the Plans. The monthly fees paid to the
Distributor are subject to the review and approval of the Fund's unaffiliated
directors who may reduce the fees or terminate the Plans at any time.
The Transfer Agent, Delaware Service Company, Inc., serves as the
shareholder servicing, dividend disbursing and transfer agent for the Fund
under an Agreement dated June 29, 1988. The directors annually review service
fees paid to the Transfer Agent.
The Distributor and the Transfer Agent are also indirect,
wholly-owned subsidiaries of DMH.
EXPENSES
The Fund is responsible for all of its own expenses other than those
borne by the Manager under the Investment Management Agreement and those borne
by the Distributor under the Distribution Agreement. The Class A Shares' ratio
of expenses to average daily net assets for the fiscal year ended June 30, 1995
was 1.36%. The Class B Shares' ratio of expenses to average daily net assets
for the period September 6, 1994 (date of initial public offering) through June
30, 1995 was 2.12%, annualized. The Fund
-36-
<PAGE> 42
(DTF-ABC)
anticipates that the expense ratio for Class C Shares will be identical to the
expense ratio for Class B Shares. The expense ratio of each Class reflects the
impact of its Plan.
SHARES
The Fund is an open-end management investment company and its
portfolio of assets is diversified for purposes of the 1940 Act. Commonly
known as a mutual fund, the Fund was organized as a Maryland corporation on
March 4, 1983. Previously, it was a Delaware corporation organized in 1966.
Fund shares have a par value of $.50, equal voting rights, except as
noted below, and are equal in all other respects. All Fund shares have
noncumulative voting rights which means that the holders of more than 50% of
the Fund's shares voting for the election of directors can elect 100% of the
directors if they choose to do so. Under Maryland law, the Fund is not
required, and does not intend, to hold annual meetings of shareholders unless,
under certain circumstances, it is required to do so under the 1940 Act.
Shareholders of 10% or more of the Fund's shares may request that a special
meeting be called to consider the removal of a director.
In addition to Class A Shares, Class B Shares and Class C Shares,
the Fund also offers the Trend Fund Institutional Class. Shares of each class
represent proportionate interests in the assets of the Fund and have the same
voting and other rights and preferences as the other classes of the Fund,
except that shares of the Trend Fund Institutional Class are not subject to,
and may not vote on matters affecting, the Plans. Similarly, as a general
matter, shareholders of Class A Shares, Class B Shares and Class C Shares may
vote only on matters affecting the Plan that relates to the Class of shares
that they hold. However, the Class B Shares may vote on a proposal to increase
materially the fees to be paid by the Fund under the Plan relating to the Class
A Shares.
Prior to September 6, 1994, the Trend Fund A Class was known as the
Trend Fund class and the Trend Fund Institutional Class was known as the Trend
Fund (Institutional) class.
-37-
<PAGE> 43
(DTF-ABC)
APPENDIX A
ILLUSTRATIONS OF THE POTENTIAL IMPACT ON INVESTMENT BASED ON PURCHASE OPTION
$10,000 PURCHASE
<TABLE>
<CAPTION>
Scenario 1 Scenario 2
No Redemption Redeem 1st Year
----------------------------------------- ------------------------------
Year Class A Class B Class C Class A Class B Class C
---- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
0 9,525 10,000 10,000 9,525 10,000 10,000
1 10,478 10,930 10,930 10,478 10,530 10,830+
2 11,525 11,946 11,946
3 12,678 13,058 13,058
4 13,946 14,272 14,272
5 15,340 15,599 15,599
6 16,874 17,050 17,050
7 18,562 18,636 18,636
8 20,418+ 20,369 20,369
9 22,459 22,405* 22,263
10 24,705 24,646* 24,333
</TABLE>
<TABLE>
<CAPTION>
Scenario 3 Scenario 4
Redeem 3rd Year Redeem 5th Year
-------- ----------------------------- -----------------------------
Year Class A Class B Class C Class A Class B Class C
---- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
0 9,525 10,000 10,000 9,525 10,000 10,000
1 10,478 10,930 10,930 10,478 10,930 10,930
2 11,525 11,946 11,946 11,525 11,946 11,946
3 12,678 12,758 13,058+ 12,678 13,058 13,058
4 13,946 14,272 14,272
5 15,340 15,399 15,599+
6
7
8
9
10
</TABLE>
*This assumes that Class B Shares were converted to Class A Shares at the end
of the eighth year.
$250,000 PURCHASE
<TABLE>
<CAPTION>
Scenario 1 Scenario 2
No Redemption Redeem 1st Year
--------------------------------------- ------------------------------
Year Class A Class B Class C Class A Class B Class C
---- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
0 243,750 250,000 250,000 243,750 250,000 250,000
1 268,125 273,250 273,250 268,125 263,250 270,750+
2 294,938 298,662 298,662
3 324,431 326,438 326,438
4 356,874+ 356,797 356,797
5 392,562 389,979 389,979
6 431,818 426,247 426,247
7 475,000 465,888 465,888
8 522,500 509,215 509,215
9 574,750 560,137* 556,572
10 632,225 616,150* 608,333
</TABLE>
<TABLE>
<CAPTION>
Scenario 3 Scenario 4
Redeem 3rd Year Redeem 5th Year
------------------------------ -----------------------------
Year Class A Class B Class C Class A Class B Class C
---- ------- ------- ------- ------- ------- -------
<S> <C> <C> <C> <C> <C> <C>
0 243,750 250,000 250,000 243,750 250,000 250,000
1 268,125 273,250 273,250 268,125 273,250 273,250
2 294,938 298,662 298,662 294,938 298,662 298,662
3 324,431 318,938 326,438+ 324,431 326,438 326,438
4 356,874+ 356,797 356,797
5 392,562 384,979 389,979
6
7
8
9
10
</TABLE>
*This assumes that Class B Shares convert to Class A Shares at the end of the
eighth year.
Assumes a hypothetical return for Class A of 10% per year, a hypothetical
return for Class B of 9.3% for years 1-8 and 10% for years 9-10, and a
hypothetical return for Class C of 9.3% per year.
Hypothetical returns vary due to the different expense structures for
each class and do not represent actual performance.
Class A purchase subject to appropriate sales charge breakpoint (4.75% @
$10,000; 3.75% @ $100,000; 2.50% @ $250,000).
Class B purchase assessed appropriate CDSC upon redemption (4%-4%-3%-3%-2%-1%
in years 1-2-3-4-5-6).
Class C purchase assessed 1% CDSC upon redemption in year 1.
Figures marked "+" identify which class offers the greater return potential
based on investment amount and holding period.
-38-
<PAGE> 44
(DTF-ABC)
The Delaware Group includes funds with a wide range of investment
objectives. Stock funds, income funds, tax-free funds, money market funds,
global and international funds and closed-end equity funds give investors the
ability to create a portfolio that fits their personal financial goals. For
more information, contact your financial adviser or call Delaware Group at
800-523-4640, in Philadelphia call 215-988-1333.
INVESTMENT MANAGER
Delaware Management Company, Inc.
One Commerce Square
Philadelphia, PA 19103
NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
1818 Market Street
Philadelphia, PA 19103
SHAREHOLDER SERVICING,
DIVIDEND DISBURSING
AND TRANSFER AGENT
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103
LEGAL COUNSEL
Stradley, Ronon, Stevens & Young
One Commerce Square
Philadelphia, PA 19103
INDEPENDENT AUDITORS
Ernst & Young LLP
Two Commerce Square
Philadelphia, PA 19103
CUSTODIAN
Chemical Bank
450 West 33rd Street
New York, NY 10001
- -------------------------------------
TREND FUND
- -------------------------------------
A CLASS
- -------------------------------------
B CLASS
- -------------------------------------
C CLASS
- -------------------------------------
P R O S P E C T U S
- -------------------------------------
November 29, 1995
DELAWARE
GROUP
--------
-39-
<PAGE> 45
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
* The Registrant's Institutional Class Prospectus dated October 31,
1995 is incorporated into this filing by reference to the
electronic filing of that Prospectus made pursuant to Rule 497(c)
on November 6, 1995.
<PAGE> 46
NOVEMBER 29, 1995
DELAWARE GROUP TREND FUND, INC.
TREND FUND INSTITUTIONAL CLASS
SUPPLEMENT TO PROSPECTUS DATED OCTOBER 31, 1995
ADDITIONAL CLASSES
In addition to the Institutional Class, the Delaware Group Trend Fund,
Inc. offers the Trend Fund A Class, the Trend Fund B Class and the Trend Fund C
Class shares (together, the "Fund Classes"), which are described in a separate
prospectus relating to the Fund Classes. The Fund Classes have sales charges
and other expenses that are different from the Institutional Class and that may
affect the performance of the Fund Classes. For a prospectus relating to the
Fund Classes, write to Delaware Distributors, L.P. at 1818 Market Street,
Philadelphia, PA 19103, or call at one of the following telephone numbers:
800-523-4640 (Nationwide) or 215-988-1333 (Philadelphia).
INVESTMENT STRATEGY
The following supplements the information in the fifth paragraph under
Investment Strategy:
The Board has instructed the Manager to consider the
following factors in determining the liquidity of a Rule 144A
Security: (i) the frequency of trades and trading volume for
the security; (ii) whether at least three dealers are willing
to purchase or sell the security and the number of potential
purchasers; (iii) whether at least two dealers are making a
market in the security; and (iv) the nature of the security
and the nature of the marketplace trades (e.g., the time
needed to dispose of the security, the method of soliciting
offers, and the mechanics of transfer.
If the Manager determines that a Rule 144A Security
which was previously determined to be liquid is no longer
liquid and, as a result, the Fund's holdings of illiquid
securities exceed the Fund's 10% limit on investments in such
securities, the Manager will determine what action to take to
ensure that the Fund continues to adhere to such limitation.
<PAGE> 47
(SAI-DTF/PART B)
- --------------------------------------------------------------------------------
PART B--STATEMENT OF ADDITIONAL INFORMATION
NOVEMBER 29, 1995
- --------------------------------------------------------------------------------
DELAWARE GROUP TREND FUND, INC.
- --------------------------------------------------------------------------------
1818 MARKET STREET
PHILADELPHIA, PA 19103
FOR MORE INFORMATION ABOUT THE
TREND FUND INSTITUTIONAL CLASS:
800-828-5052
FOR PROSPECTUS AND PERFORMANCE
OF THE TREND FUND A CLASS,
THE TREND FUND B CLASS AND THE
TREND FUND C CLASS:
NATIONWIDE 800-523-4640
PHILADELPHIA 215-988-1333
INFORMATION ON EXISTING ACCOUNTS
OF THE TREND FUND A CLASS, THE
TREND FUND B CLASS AND THE TREND
FUND C CLASS:
(SHAREHOLDERS ONLY)
NATIONWIDE 800-523-1918
PHILADELPHIA 215-988-1241
DEALER SERVICES:
(BROKER/DEALERS ONLY)
NATIONWIDE 800-362-7500
PHILADELPHIA 215-988-1050
- --------------------------------------------------------------------------------
TABLE OF CONTENTS
- --------------------------------------------------------------------------------
COVER PAGE
- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVE AND POLICIES
- --------------------------------------------------------------------------------
PERFORMANCE INFORMATION
- --------------------------------------------------------------------------------
TRADING PRACTICES AND BROKERAGE
- --------------------------------------------------------------------------------
PURCHASING SHARES
- --------------------------------------------------------------------------------
INVESTMENT PLANS
- --------------------------------------------------------------------------------
DETERMINING OFFERING PRICE AND
NET ASSET VALUE
- --------------------------------------------------------------------------------
REDEMPTION AND REPURCHASE
- --------------------------------------------------------------------------------
DIVIDENDS AND REALIZED SECURITIES
PROFITS DISTRIBUTIONS
- --------------------------------------------------------------------------------
TAXES
- --------------------------------------------------------------------------------
INVESTMENT MANAGEMENT AGREEMENT
- --------------------------------------------------------------------------------
OFFICERS AND DIRECTORS
- --------------------------------------------------------------------------------
EXCHANGE PRIVILEGE
- --------------------------------------------------------------------------------
GENERAL INFORMATION
- --------------------------------------------------------------------------------
APPENDIX A - IRA INFORMATION
- --------------------------------------------------------------------------------
APPENDIX B - PERFORMANCE OVERVIEW
- --------------------------------------------------------------------------------
APPENDIX C - THE COMPANY LIFE CYCLE
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
-1-
<PAGE> 48
(SAI-DTF/PART B)
Delaware Group Trend Fund, Inc. (the "Fund") is a professionally-managed
mutual fund. The Fund offers four classes (individually, a "Class" and
collectively, the "Classes") of shares - the Trend Fund A Class (the "Class A
Shares"), the Trend Fund B Class (the "Class B Shares") and the Trend Fund C
Class (the "Class C Shares) (together, the "Fund Classes") and the Trend Fund
Institutional Class (the "Institutional Class"). Class B Shares, Class C
Shares and Institutional Class shares may be purchased at a price equal to the
next determined net asset value per share. Class A Shares may be purchased at
the public offering price, which is equal to the next determined net asset
value per share, plus a front-end sales charge. Class A Shares are subject to
a maximum front-end sales charge of 4.75% and annual 12b-1 Plan expenses of up
to 0.30%. Class B Shares are subject to a contingent deferred sales charge
("CDSC") which may be imposed on redemptions made within six years of purchase
and annual 12b-1 Plan expenses of up to 1%, which are assessed against Class B
Shares for approximately eight years after purchase. See Automatic Conversion
of Class B Shares under Buying Shares in the Fund Classes' Prospectus. Class C
Shares are subject to a CDSC which may be imposed on redemptions made within
twelve months of purchase and annual 12b-1 Plan expenses of up to 1%, which are
assessed against the Class C Shares for the life of the investment. All
references to "shares" in this Statement of Additional Information ("Part B" of
the registration statement) refer to all Classes of shares of the Fund, except
where noted.
This Part B supplements the information contained in the current
Prospectus for the Fund Classes dated November 29, 1995 and the current
Prospectus for the Institutional Class dated October 31, 1995 and the
supplement thereto dated November 29, 1995, as they may be amended from time to
time. It should be read in conjunction with the respective Class' Prospectus.
Part B is not itself a prospectus but is, in its entirety, incorporated by
reference into each Class' Prospectus. A Prospectus relating to the Fund
Classes and a Prospectus relating to the Institutional Class may be obtained by
writing or calling your investment dealer or by contacting the Fund's national
distributor, Delaware Distributors, L.P. (the "Distributor"), 1818 Market
Street, Philadelphia, PA 19103.
-2-
<PAGE> 49
(SAI-DTF/PART B)
INVESTMENT OBJECTIVE AND POLICIES
The objective of the Fund, which is a fundamental policy and cannot be
changed without shareholder approval, is capital appreciation. The strategy is
to invest primarily in the common stocks and securities convertible into common
stocks of emerging and other growth-oriented companies that, in the judgment of
Delaware Management Company, Inc. (the "Manager"), are responsive to changes
within the marketplace and have the fundamental characteristics to support
growth. Income will not be a significant investment factor except so far as
future dividend growth may affect market appraisal of a security. Purchases
and sales of portfolio securities will be based upon management's judgment of
economic and market trends in addition to fundamental investment analysis. The
Fund will seek to identify changing and dominant trends affecting securities
values which it believes will offer the opportunities for growth of capital,
such as trends in the overall economic environment (including social,
political, monetary and technological trends); trends within a company and its
industry reflected by, for example, improving managerial skills, new product
development and sales and earnings trends; and trends in market prices of
various types of categories of investments. Since the production of income is
not an objective of the Fund, any income earned and paid to shareholders will
likely be minimal. An investor should not consider a purchase of Fund shares
as equivalent to a complete investment program.
Although the Fund will constantly strive to attain the objective of
capital appreciation, of course there can be no assurance that it will be
attained. It also should be borne in mind that investing in securities
believed to have a potential for capital appreciation may involve exposure to a
greater risk than securities which do not have growth characteristics, and that
the shares of the Fund will fluctuate in value. Investing for this objective,
the Fund usually will invest in common stocks or securities convertible into
common stocks of emerging and other growth-oriented companies, some of which
may be of a speculative nature and subject the Fund to an additional risk.
However, from time to time, the Fund may, in its judgment, depending upon
prevailing circumstances, and for defensive purposes without limit as to the
proportion of assets invested, hold varying proportions of cash, U.S.
Government securities, nonconvertible securities and straight debt securities.
In investing for capital appreciation, the Fund may hold securities for
any period of time. See Portfolio Turnover under Trading Practices and
Brokerage.
While the Fund is permitted to do so, it normally does not invest in
repurchase agreements, except to invest excess cash balances. A repurchase
agreement is a short-term investment by which the purchaser acquires ownership
of a debt security and the seller agrees to repurchase the obligation at a
future time and set price, thereby determining the yield during the purchaser's
holding period. Should an issuer of a repurchase agreement fail to repurchase
the underlying security, the loss to the Fund, if any, would be the difference
between the repurchase price and the market value of the security. The Fund
will limit its investments in repurchase agreements to those which the Manager
under the guidelines of the Board of Directors determines to present minimal
credit risks and which are of high quality. In addition, the Fund must have
collateral of at least 100% of the repurchase price, including the portion
representing the Fund's yield under such agreements which is monitored on a
daily basis.
The funds in the Delaware Group have obtained an exemption from the
joint-transaction prohibitions of Section 17(d) of the Investment Company Act
of 1940 (the "1940 Act") to allow the Delaware Group funds jointly to invest
cash balances. The Fund may invest cash balances in a joint repurchase
agreement in accordance with the
-3-
<PAGE> 50
(SAI-DTF/PART B)
terms of the Order and subject generally to the conditions described above.
While the Fund is permitted under certain circumstances to borrow money
and invest in investment company securities, it does not normally do so.
Investment securities will not normally be purchased while the Fund has an
outstanding borrowing.
The Fund may purchase privately placed securities which may be resold
only in privately negotiated transactions, in accordance with an exemption from
registration under applicable securities laws or after registration. The
registration process may involve delays which could result in the Fund
obtaining a less favorable price on resale. In addition, to the extent that
there is no established trading market for restricted securities, it will be
more difficult for the Fund to obtain precise valuations for such securities in
its portfolio. As a result, judgment may play a greater role in valuing such
securities than is normally the case.
Certain of the privately placed securities acquired by the Fund will be
eligible for resale pursuant to Rule 144A under the Securities Act of 1933
("Rule 144A Securities"). The Fund's Board of Directors has instructed the
Manager to consider the following factors in determining the liquidity of Rule
144A Securities: (i) the frequency of trades and trading volume for the
security; (ii) whether at least three dealers are willing to purchase or sell
the security and the number of potential purchasers; (iii) whether at least two
dealers are making a market in the security; and (iv) the nature of the
security and the nature of the marketplace trades (e.g., the time needed to
dispose of the security, the method of soliciting offers, and the mechanics of
transfer). Investing in Rule 144A Securities could have the effect of
increasing the level of the Fund's illiquidity to the extent that qualified
institutional buyers become, for a period of time, uninterested in purchasing
these securities.
Although it is not a matter of fundamental policy, the Fund may invest
not more than 5% of its assets in foreign securities. Foreign markets may be
more volatile than U.S. markets. Such investments involve sovereign risk in
addition to the normal risks associated with American securities. These risks
include political risks, foreign taxes and exchange controls and currency
fluctuations. For example, foreign portfolio investments may fluctuate in
value due to changes in currency rates (i.e., the value of foreign investments
would increase with a fall in the value of the dollar, and decrease with a rise
in the value of the dollar) and control regulations apart from market
fluctuations. The Fund may also experience delays in foreign securities
settlement.
PORTFOLIO LOAN TRANSACTIONS
The Fund may loan up to 25% of its assets to qualified broker/dealers or
institutional investors for their use relating to short sales or other security
transactions.
It is the understanding of the Manager that the staff of the Securities
and Exchange Commission permits portfolio lending by registered investment
companies if certain conditions are met. These conditions are as follows: 1)
each transaction must have 100% collateral in the form of cash, short-term U.S.
Government securities, or irrevocable letters of credit payable by banks
acceptable to the Fund from the borrower; 2) this collateral must be valued
daily and should the market value of the loaned securities increase, the
borrower must furnish additional collateral to the Fund; 3) the Fund must be
able to terminate the loan after notice, at any time; 4) the Fund must receive
reasonable interest on any loan, and any dividends, interest or other
distributions on the lent securities, and any increase in the market value of
such securities; 5) the Fund may pay reasonable custodian fees in connection
with the loan; 6) the voting rights on the lent securities may pass to the
borrower; however, if the directors of the Fund know that a material event will
occur affecting an investment loan, they must either terminate the loan
-4-
<PAGE> 51
(SAI-DTF/PART B)
in order to vote the proxy or enter into an alternative arrangement with the
borrower to enable the directors to vote the proxy.
The major risk to which the Fund would be exposed on a loan transaction
is the risk that the borrower would go bankrupt at a time when the value of the
security goes up. Therefore, the Fund will only enter into loan arrangements
after a review of all pertinent facts by the Manager, under the supervision of
the Board of Directors, including the creditworthiness of the borrowing broker,
dealer or institution and then only if the consideration to be received from
such loans would justify the risk. Creditworthiness will be monitored on an
ongoing basis by the Manager.
INVESTMENT RESTRICTIONS
The Fund has the following investment restrictions which may not be
amended without approval of a majority of the outstanding voting securities,
which is the lesser of a) 67% or more of the voting securities present in
person or by proxy at a meeting if the holders of more than 50% of the
outstanding voting securities are present or represented by proxy; or b) more
than 50% of the outstanding voting securities. The percentage limitations
contained in the restrictions and policies set forth herein apply at the time
of purchase of securities.
1. Not to invest more than 5% of the value of its assets in securities
of any one company (except U.S. Government bonds) or purchase more than 10% of
the voting or nonvoting securities of any one company.
2. Not to acquire control of any company.
3. Not to purchase or retain securities of any company which has an
officer or director who is an officer or director of the Fund, or an officer,
director or partner of its investment manager if, to the knowledge of the Fund,
one or more of such persons own beneficially more than 1/2 of 1% of the shares
of the company, and in the aggregate more than 5% thereof.
4. Not to invest in securities of other investment companies except at
customary brokerage commissions rates or in connection with mergers,
consolidations or offers of exchange.
5. Not to purchase any security issued by any other investment company
if after such purchase it would: (a) own more than 3% of the voting stock of
such company, (b) own securities of such company having a value in excess of 5%
of the Fund's assets or (c) own securities of investment companies having an
aggregate value in excess of 10% of the Fund's assets.
6. Not to make any investment in real estate unless necessary for
office space or the protection of investments already made. (This restriction
does not preclude the Fund's purchase of securities issued by real estate
investment trusts.) Any investment in real estate together with any investment
in illiquid assets cannot exceed 10% of the value of the Fund's assets.
7. Not to sell short any security or property.
8. Not to deal in commodities.
9. Not to borrow money in excess of 10% of the value of its assets, and
then only as a temporary measure for extraordinary or emergency purposes. Any
borrowing will be done from a bank and to the extent that such borrowing
exceeds 5% of the value of the Fund's assets, asset coverage of at least 300%
is required. In the event that such asset coverage shall at any time fall
below 300%, the Fund shall, within three days thereafter (not including Sunday
and holidays) or such longer period as the Securities and Exchange Commission
may prescribe by rules and regulations, reduce the amount of its borrowings to
an extent that the asset coverage of such borrowings shall be at least 300%.
The Fund shall not issue senior securities as defined in the Investment Company
Act of 1940, except for notes to banks.
10. Not to make loans. However, the purchase of a portion of an issue
of publicly distributed bonds, debentures or other securities,
-5-
<PAGE> 52
(SAI-DTF/PART B)
whether or not the purchase was made upon the original issuance of the
securities, and the entry into "repurchase agreements" are not to be considered
the making of a loan by the Fund and the Fund may loan up to 25% of its assets
to qualified broker/dealers or institutional investors for their use relating
to short sales or other security transactions.
11. Not to invest more than 5% of the value of its total assets in
securities of companies less than three years old. Such three-year period
shall include the operation of any predecessor company or companies.
12. Not to act as an underwriter of securities of other issuers.
13. No long or short positions on shares of the Fund may be taken by
its officers, directors or any of its affiliated persons. Such persons may buy
shares of the Fund for investment purposes, however, as described under
Purchasing Shares.
14. Not to invest more than 25% of its assets in any one particular
industry.
Although it is not a matter of fundamental policy, the Fund has also
made a commitment that it will not invest in warrants valued at the lower of
cost or market exceeding 5% of the Fund's net assets. Included within that
amount, but not to exceed 2% of the Fund's net assets, may be warrants not
listed on the New York Stock Exchange or American Stock Exchange. In addition,
although not a fundamental investment restriction, the Fund currently does not
invest its assets in real estate limited partnerships or oil, gas and other
mineral leases.
-6-
<PAGE> 53
(SAI-DTF/PART B)
PERFORMANCE INFORMATION
From time to time, the Fund may state each Class' total return in
advertisements and other types of literature. Any statements of total return
performance data for a Class will be accompanied by information on the average
annual compounded rate of return for that Class over, as relevant, the most
recent one-, five- and ten-year periods. The Fund may also advertise aggregate
and average total return information of each Class over additional periods of
time.
The average annual total rate of return for each Class is based on a
hypothetical $1,000 investment that includes capital appreciation and
depreciation during the stated periods. The following formula will be used for
the actual computations:
n
P(1+T) = ERV
Where: P = a hypothetical initial purchase order of $1,000 from
which, in the case only of Class A Shares, the maximum
front-end sales charge, if any, is deducted;
T = average annual total return;
n = number of years;
ERV = redeemable value of the hypothetical $1,000 purchase at
the end of the period after the deduction of the
applicable CDSC, if any, with respect to Class B Shares
and Class C Shares.
Aggregate or cumulative total return is calculated in a similar manner,
except that the results are not annualized. Each calculation assumes the
maximum front-end sales charge, if any, is deducted from the initial $1,000
investment at the time it is made with respect to Class A Shares and that all
distributions are reinvested at net asset value, and, with respect to Class B
Shares and Class C Shares reflects the deduction of the CDSC that would be
applicable upon complete redemption of such shares. In addition, the Fund may
present total return information that does not reflect the deduction of the
maximum front-end sales charge or any applicable CDSC.
The performance of Class A Shares and the Institutional Class, as shown
below, is the average annual total return quotations for the one-, three-,
five-, ten- and fifteen-year periods ended June 30, 1995 and for the life of
these Classes, computed as described above. The average annual total return
for Class A Shares at offer reflects the maximum front-end sales charges paid
on the purchase of shares. The average annual total return for the Class A
Shares at net asset value (NAV) does not reflect the payment of the maximum
front-end sales charge of 4.75%. Stock prices fluctuated during the periods
covered and past results should not be considered as representative of future
performance. Pursuant to applicable regulation, total return shown for the
Institutional Class for the periods prior to the commencement of operations of
such Class is calculated by taking the performance of Class A Shares and
adjusting it to reflect the elimination of all sales charges. However, for
those periods, no adjustment has been made to eliminate the impact of 12b-1
payments, and performance would have been affected had such an adjustment been
made.
In the case of Class A Shares, the Limited CDSC, applicable only to
certain redemptions of those shares, will not be deducted from any computation
of total return. See the Prospectus for the Fund Classes for a description of
the Limited CDSC and the limited instances in which it applies. All references
to a CDSC will apply to Class B Shares or Class C Shares.
-7-
<PAGE> 54
(SAI-DTF/PART B)
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURN
CLASS A CLASS A
SHARES(1) SHARES(1) INSTITUTIONAL
(AT OFFER) (AT NAV) CLASS(2)
<S> <C> <C> <C>
1 year
ended
6/30/95 18.48% 24.40% 24.74%
3 years
ended
6/30/95 17.24% 19.17% 19.40%
5 years
ended
6/30/95 14.68% 15.81% 15.94%
10 years
ended
6/30/95 15.08% 15.64% 15.71%
15 years
ended
6/30/95 16.48% 16.86% 16.91%
Period
10/3/68(3)
through
6/30/95 8.53% 8.73% 8.75%
</TABLE>
(1) Class A Shares began paying 12b-1 payments on June 1, 1992 and
performance prior to that date does not reflect such payments. Prior to
November 29, 1995, the maximum front-end sales charge was 5.75%.
Effective November 29, 1995, the maximum front-end sales charge was
reduced to 4.75% and the above performance numbers are calculated using
4.75% as the applicable sales charge.
(2) Date of initial public offering was November 23, 1992.
(3) Date of initial public offering of Class A Shares.
The performance of Class B Shares, as shown below, is the aggregate
total return quotation for the period September 6, 1994 (date of initial public
offering) through June 30, 1995. The aggregate total return for Class B Shares
including deferred sales charge reflects the deduction of the applicable CDSC
that would be paid if the shares were redeemed at June 30, 1995. The aggregate
total return for Class B Shares excluding deferred sales charge assumes the
shares were not redeemed at June 30, 1995 and therefore does not reflect the
deduction of a CDSC.
<TABLE>
<CAPTION>
AGGREGATE TOTAL RETURN
CLASS B SHARES CLASS B SHARES
(INCLUDING (EXCLUDING
DEFERRED DEFERRED
SALES CHARGE) SALES CHARGE)
<S> <C> <C>
Period
9/6/94(1)
through
6/30/95 12.68% 16.68%
</TABLE>
(1) Date of initial public offering of Class B Shares; total return for this
short of a time period may not be representative of longer-term
results.
Information regarding the performance of Class C Shares is not shown
because such shares were not offered to the public prior to the date of this
Part B.
The Fund may also state total return performance for each Class in the
form of an average annual return. This average annual return figure will be
computed by taking the sum of a Class' annual returns, then dividing that
figure by the number of years in the overall period indicated. The computation
will reflect the impact of the maximum front-end sales charge or CDSC if any,
paid on the illustrated investment amount against the first year's return.
From time to time, the Fund may quote actual total return performance for each
Class in advertising and other types of literature compared to indices or
averages of alternative financial products available to prospective investors.
For example, the performance comparisons may include the average return of
various bank instruments, some of which may carry certain return guarantees
offered by leading banks and thrifts as monitored by Bank Rate Monitor, and
those of generally-accepted corporate bond and government security price
indices of various durations prepared by Lehman Brothers and Salomon Brothers,
Inc. These indices are not managed for any investment goal.
Total return performance for the Classes will be computed by adding all
reinvested income and realized securities profits distributions plus the change
in net asset value during a specific period and dividing by the offering price
at the beginning of the period. It will also reflect the maximum sales charge,
if any, paid for the illustrated
-8-
<PAGE> 55
(SAI-DTF/PART B)
investment amount, but not any income taxes payable by shareholders on the
reinvested distributions included in the calculation. Because securities
prices fluctuate, past performance should not be considered as a representation
of the results which may be realized from an investment in the Fund in the
future.
From time to time, the Fund may also quote each Class' actual total
return performance, dividend results and other performance information in
advertising and other types of literature and may compare that information to,
or may separately illustrate similar information reported by the Standard and
Poor's 500 Stock Index and the Dow Jones Industrial Average and other unmanaged
indices.
The Standard & Poor's 500 Stock Index and the Dow Jones Industrial
Average are industry-accepted unmanaged indices of generally-conservative
securities used for measuring general market performance. The total return
performance reported for these indices will reflect the reinvestment of all
distributions on a quarterly basis and market price fluctuations. The indices
do not take into account any sales charge or other fees. In seeking a
particular investment objective, the Fund's portfolio primarily includes common
stocks considered by the Manager to be more aggressive than those tracked by
these indices.
Comparative information on the Consumer Price Index and the CDA Growth
Index may also be included. The Consumer Price Index, as prepared by the U.S.
Bureau of Labor Statistics, is the most commonly used measure of inflation. It
indicates the cost fluctuations of a representative group of consumer goods.
It does not represent a return from an investment. The CDA Growth Index was
developed and is maintained by CDA Technologies, Inc. The Index is comprised
of 230 separately-managed, growth-oriented equity mutual funds. It reflects
the reinvestment of any dividend and capital gains distributions paid during a
specified period.
Statistical and performance information and various indices compiled and
maintained by organizations such as the following may also be used in preparing
exhibits comparing certain industry trends and competitive mutual fund
performance to comparable Fund activity and performance and in illustrating
general financial planning principles. From time to time, certain mutual fund
performance ranking information, calculated and provided by these
organizations, may also be used in the promotion of sales in the Fund. Any
indices used are not managed for any investment goal.
CDA Technologies, Inc., Lipper Analytical Services, Inc. and
Morningstar, Inc. are performance evaluation services that maintain
statistical performance databases, as reported by a diverse universe of
independently-managed mutual funds.
Ibbotson Associates, Inc. is a consulting firm that provides a variety
of historical data including total return, capital appreciation and
income on the stock market as well as other investment asset classes,
and inflation. With their permission, this information will be used
primarily for comparative purposes and to illustrate general financial
planning principles.
Interactive Data Corporation is a statistical access service that
maintains a database of various international industry indicators, such
as historical and current price/earning information, individual equity
and fixed income price and return information.
Compustat Industrial Databases, a service of Standard & Poor's, may also
be used in preparing performance and historical stock and
-9-
<PAGE> 56
(SAI-DTF/PART B)
bond market exhibits. This firm maintains fundamental databases that
provide financial, statistical and market information covering more than
7,000 industrial and non-industrial companies.
Salomon Brothers and Lehman Brothers are statistical research firms that
maintain databases of international market, bond market, corporate and
government-issued securities of various maturities. This information,
as well as unmanaged indices compiled and maintained by these firms,
will be used in preparing comparative illustrations.
The following table is an example, for purposes of illustration only, of
cumulative total return performance for the Class A Shares and the
Institutional Class for the three-, six- and nine-month periods ended June 30,
1995, for the one-, three-, five-, ten- and fifteen-year periods ended June 30,
1995 and for the life of these Classes. For these purposes, the calculations
assume the reinvestment of any capital gains distributions and income dividends
paid during the indicated periods. Comparative information on the Standard &
Poor's 500 Stock Index, the Dow Jones Industrial Average and the NASDAQ
Composite Index is also included. Information regarding the performance of
Class C Shares is not shown because such shares were not offered to the public
prior to the date of this Part B.
The performance of the Class A Shares, Class B Shares and the
Institutional Class, as shown below, reflects maximum front-end sales charges,
if any, but not any income taxes payable by shareholders on the reinvested
distributions included in the calculations. The net asset value of a Class
fluctuates so shares, when redeemed, may be worth more or less than the
original investment, and a Class' results should not be considered as
representative of future performance. The performance of the Class B Shares is
calculated both with the applicable CDSC included and excluded.
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN
DOW
CLASS A INSTITU- STANDARD JONES
SHARES(1) TIONAL & POOR'S INDUS- NASDAQ
(AT OFFER) CLASS(2) 500 TRIAL COMPOSITE
<S> <C> <C> <C> <C> <C>
3 months
ended
6/30/95 5.9% 11.2% 9.5% 10.3% 14.2%
6 months
ended
6/30/95 15.2% 21.1% 20.2% 20.4% 24.1%
9 months
ended
6/30/95 11.1% 16.9% 20.2% 21.0% 22.1%
1 year
ended
6/30/95 18.5% 24.7% 26.1% 29.2% 32.2%
3 years
ended
6/30/95 61.2% 70.2% 45.2% 49.5% 65.6%
5 years
ended
6/30/95 98.3% 109.5% 76.8% 84.1% 101.9%
10 years
ended
6/30/95 307.5% 330.3% 292.7% 380.6% 215.1%
15 years
ended
6/30/95 885.6% 941.3% 743.8% 872.1% 491.6%
Period
10/3/68(3)
through
6/30/95 792.0% 842.2% 1,404.1% 1,418.7% N/A
</TABLE>
(1) Class A Shares began paying 12b-1 payments on June 1, 1992 and performance
prior to that date does not reflect such payments. Prior to November 29,
1995, the maximum front-end sales charge was 5.75%. Effective November
29, 1995, the maximum front-end sales charge was reduced to 4.75%, and the
above performance numbers are calculated using 4.75% as the applicable
sales charge.
(2) Date of initial public offering was November 23, 1992. Pursuant to
applicable regulation, total return shown for the Institutional Class for
the periods prior to the commencement of operations of such Class is
calculated by taking the performance of the Class A Shares and adjusting
it to reflect the elimination of all sales charges. However, for those
periods no adjustment has been made to eliminate the impact of 12b-1
payments, and performance would have been affected had such an adjustment
been made.
(3) Date of initial public offering of Class A Shares.
-10-
<PAGE> 57
(SAI-DTF/PART B)
The performance of the Class B Shares, as shown below, is the cumulative
total return quotation for the three-, six- and nine-month periods ended June
30, 1995 and for the life of this Class. The aggregate total return for Class
B Shares including deferred sales charge reflects the deduction of the
applicable CDSC that would be paid if the shares were redeemed at June 30,
1995. The aggregate total return for Class B Shares excluding deferred sales
charge assumes the shares were not redeemed at June 30, 1995 and therefore does
not reflect the deduction of a CDSC. Comparative information on the Standard &
Poor's 500 Stock Index, the Dow Jones Industrial Average and the NASDAQ
Composite Index is also included.
<TABLE>
<CAPTION>
CUMULATIVE TOTAL RETURN
CLASS B CLASS B
SHARES SHARES
(INCLUDING (EXCLUDING DOW
DEFERRED DEFERRED JONES NASDAQ
SALES SALES STANDARD INDUS- COMPO-
CHARGE) CHARGE) & POOR'S TRIAL SITE
<S> <C> <C> <C> <C> <C>
3 months
ended
6/30/95 6.9% 10.9% 9.5% 10.3% 14.2%
6 months
ended
6/30/95 16.5% 20.5% 20.2% 20.4% 24.1%
9 months
ended
6/30/95 12.1% 16.1% 20.2% 21.0% 22.1%
Period
9/6/94(1)
through
6/30/95 12.7% 16.7% 18.1% 19.5% 22.9%
</TABLE>
(1) Date of initial public offering of Class B Shares; total return for this
short of a time period may not be representative of longer-term results.
For additional performance information, see Appendix B.
Because every investor's goals and risk threshold are different, the
Distributor, as distributor for the Fund and other mutual funds in the Delaware
Group, will provide general information about investment alternatives and
scenarios that will allow investors to assess their personal goals. This
information will include general material about investing as well as materials
reinforcing various industry-accepted principles of prudent and responsible
personal financial planning. One typical way of addressing these issues is to
compare an individual's goals and the length of time the individual has to
attain these goals to his or her risk threshold. In addition, the Distributor
will provide information that discusses the Manager's overriding investment
philosophy and how that philosophy impacts the Fund's, and other Delaware Group
funds', investment disciplines employed in seeking their objectives. The
Distributor may also from time to time cite general or specific information
about the institutional clients of the Manager, including the number of such
clients serviced by the Manager.
THE POWER OF COMPOUNDING
When you opt to reinvest your current income for additional Fund shares,
your investment is given yet another opportunity to grow. It's called the
Power of Compounding and the following chart illustrates just how powerful it
can be.
-11-
<PAGE> 58
(SAI-DTF/PART B)
COMPOUNDED RETURNS
Results of various assumed fixed rates of return on a $10,000 investment
compounded quarterly for 10 years:
<TABLE>
<CAPTION>
8% Rate 10% Rate 12% Rate 14% Rate
of Return of Return of Return of Return
<S> <C> <C> <C> <C>
12-'85 $10,824 $11,038 $11,255 $11,475
12-'86 $11,717 $12,184 $12,668 $13,168
12-'87 $12,682 $13,449 $14,258 $15,111
12-'88 $13,728 $14,845 $16,047 $17,340
12-'89 $14,859 $16,386 $18,061 $19,898
12-'90 $16,084 $18,087 $20,328 $22,833
12-'91 $17,410 $19,965 $22,879 $26,202
12-'92 $18,845 $22,038 $25,751 $30,067
12-'93 $20,399 $24,325 $28,983 $34,503
12-'94 $22,080 $26,851 $32,620 $39,593
</TABLE>
These figures are calculated assuming a fixed constant investment
return and assume no fluctuation in the value of principal. These figures do
not reflect payment of applicable taxes, are not intended to be a projection of
investment results and do not reflect the actual performance results of any of
the Classes.
-12-
<PAGE> 59
(SAI-DTF/PART B)
TRADING PRACTICES AND BROKERAGE
The Fund selects brokers or dealers to execute transactions for the
purchase or sale of portfolio securities on the basis of its judgment of their
professional capability to provide the service. The primary consideration is
to have brokers or dealers execute transactions at best price and execution.
Best price and execution refers to many factors, including the price paid or
received for a security, the commission charged, the promptness and reliability
of execution, the confidentiality and placement accorded the order and other
factors affecting the overall benefit obtained by the account on the
transaction. A number of trades are made on a net basis where the Fund either
buys the securities directly from the dealer or sells them to the dealer. In
these instances, there is no direct commission charged but there is a spread
(the difference between the buy and sell price) which is the equivalent of a
commission. When a commission is paid, the Fund pays reasonably competitive
brokerage commission rates based upon the professional knowledge of its trading
department as to rates paid and charged for similar transactions throughout the
securities industry. In some instances, the Fund pays a minimal share
transaction cost when the transaction presents no difficulty.
During the fiscal years ended June 30, 1993, 1994 and 1995, the
aggregate dollar amounts of brokerage commissions paid by the Fund were
$205,614, $188,574 and $542,083, respectively.
The Manager may allocate out of all commission business generated by
all of the funds and accounts under its management, brokerage business to
brokers or dealers who provide brokerage and research services. These services
include advice, either directly or through publications or writings, as to the
value of securities, the advisability of investing in, purchasing or selling
securities, and the availability of securities or purchasers or sellers of
securities; furnishing of analyses and reports concerning issuers, securities
or industries; providing information on economic factors and trends; assisting
in determining portfolio strategy; providing computer software and hardware
used in security analyses; and providing portfolio performance evaluation and
technical market analyses. Such services are used by the Manager in connection
with its investment decision-making process with respect to one or more funds
and accounts managed by it, and may not be used, or used exclusively, with
respect to the fund or account generating the brokerage.
During the fiscal year ended June 30, 1995, portfolio transactions of
the Fund in the amount of $58,447,750, resulting in brokerage commissions of
$258,819, were directed to brokers for brokerage and research services
provided.
As provided in the Securities Exchange Act of 1934 and the Fund's
Investment Management Agreement, higher commissions are permitted to be paid to
broker/dealers who provide brokerage and research services than to
broker/dealers who do not provide such services if such higher commissions are
deemed reasonable in relation to the value of the brokerage and research
services provided. Although transactions are directed to broker/dealers who
provide such brokerage and research services, the Fund believes that the
commissions paid to such broker/dealers are not, in general, higher than
commissions that would be paid to broker/dealers not providing such services
and that such commissions are reasonable in relation to the value of the
brokerage and research services provided. In some instances, services may be
provided to the Manager which constitute in some part brokerage and research
services used by the Manager in connection with its investment decision-making
process and constitute in some part services used by the Manager in connection
with administrative or other functions not related to its investment
decision-making process. In such cases, the Manager will make a good faith
allocation of brokerage and research services and will pay out of its
-13-
<PAGE> 60
(SAI-DTF/PART B)
own resources for services used by the Manager in connection with
administrative or other functions not related to its investment decision-making
process. In addition, so long as no fund is disadvantaged, portfolio
transactions which generate commissions or their equivalent are allocated to
broker/dealers who provide daily portfolio pricing services to the Fund and to
other funds in the Delaware Group. Subject to best price and execution,
commissions allocated to brokers providing such pricing services may or may not
be generated by the funds receiving the pricing service.
The Manager may place a combined order for two or more accounts or
funds engaged in the purchase or sale of the same security if, in its judgment,
joint execution is in the best interest of each participant and will result in
best price and execution. Transactions involving commingled orders are
allocated in a manner deemed equitable to each account or fund. When a
combined order is executed in a series of transactions at different prices,
each account participating in the order may be allocated an average price
obtained from the executing broker. It is believed that the ability of the
accounts to participate in volume transactions will generally be beneficial to
the accounts and funds. Although it is recognized that, in some cases, the
joint execution of orders could adversely affect the price or volume of the
security that a particular account or fund may obtain, it is the opinion of the
Manager and the Fund's Board of Directors that the advantages of combined
orders outweigh the possible disadvantages of separate transactions.
Consistent with the Rules of Fair Practice of the National Association
of Securities Dealers, Inc. (the "NASD"), and subject to seeking best price and
execution, the Fund may place orders with broker/dealers that have agreed to
defray certain Fund expenses such as custodian fees, and may, at the request of
the Distributor, give consideration to sales of shares of the Fund as a factor
in the selection of brokers and dealers to execute Fund portfolio transactions.
PORTFOLIO TURNOVER
In investing for capital appreciation, the Fund may hold securities for
any period of time. It is anticipated that, given the Fund's investment
objective, its annual portfolio turnover rate will be higher than that of many
other investment companies. A turnover rate of 100% would occur, for example,
if all the investments in the Fund's portfolio at the beginning of the year
were replaced by the end of the year. The degree of portfolio activity will
affect brokerage costs of the Fund and may affect taxes payable by the Fund's
shareholders. Total brokerage costs generally increase with higher portfolio
turnover rates. To the extent the Fund realizes gains on securities held for
less than six months, such gains are taxable to the shareholder or to the Fund
at ordinary income tax rates. The turnover rate also may be affected by cash
requirements from redemptions and repurchases of Fund shares.
The portfolio turnover rate of the Fund is calculated by dividing the
lesser of purchases or sales of portfolio securities for the particular fiscal
year by the monthly average of the value of the portfolio securities owned by
the Fund during the particular fiscal year, exclusive of securities whose
maturities at the time of acquisition are one year or less.
During the past two fiscal years, the Fund's portfolio turnover rates
were 67% for 1994 and 64% for 1995.
-14-
<PAGE> 61
(SAI-DTF/PART B)
PURCHASING SHARES
The Distributor serves as the national distributor for the Fund's four
classes of shares - Class A Shares, Class B Shares, Class C Shares and the
Institutional Class, and has agreed to use its best efforts to sell shares of
the Fund. See the Prospectuses for information on how to invest. Shares of
the Fund are offered on a continuous basis and may be purchased through
authorized investment dealers or directly by contacting the Fund or its agent.
The minimum initial investment generally is $1,000 for Class A Shares,
Class B Shares and Class C Shares. Subsequent purchases generally must be at
least $100. The initial and subsequent investment minimums for Class A Shares
will be waived for purchases by officers, directors and employees of any
Delaware Group fund, the Manager or any of the Manager's affiliates if the
purchases are made pursuant to a payroll deduction program. Class A Shares
purchased pursuant to the Uniform Gifts to Minors Act or Uniform Transfers to
Minors Act and Class A Shares purchased in connection with an Automatic
Investing Plan are subject to a minimum initial purchase of $250 and a minimum
subsequent purchase of $25. Accounts opened under the Delaware Group Asset
Planner service are subject to a minimum initial investment of $2000 per Asset
Planner Strategy selected. There are no minimum purchase requirements for the
Institutional Class, but certain eligibility requirements must be satisfied.
Each purchase of Class B Shares is subject to a maximum purchase
limitation of $250,000. For Class C Shares, each purchase must be in an amount
that is less than $1,000,000. (See Investment Plans for purchase limitations
applicable to each of the Fund's master retirement plans.) The Fund will
reject any order for purchase of more than $250,000 of Class B Shares and
$1,000,000 or more of Class C Shares. An investor may exceed these limitations
by making cumulative purchases over a period of time. An investor should keep
in mind, however, that reduced front-end sales charges apply to investments of
$100,000 or more in Class A Shares, which are subject to lower annual 12b-1
Plan expenses than Class B Shares and Class C Shares and generally are not
subject to a CDSC.
Selling dealers have the responsibility of transmitting orders
promptly. The Fund reserves the right to reject any order for the purchase of
its shares if in the opinion of management such rejection is in the Fund's best
interest.
The NASD has adopted amendments to its Rules of Fair Practice relating
to investment company sales charges. The Fund and the Distributor intend to
operate in compliance with these rules.
Class A Shares are purchased at the offering price which reflects a
maximum front-end sales charge of 4.75%; however, lower front-end sales charges
apply for larger purchases. See the table below. Class A Shares are also
subject to annual 12b-1 Plan expenses.
Class B Shares are purchased at net asset value and are subject to a
CDSC of: (i) 4% if shares are redeemed within two years of purchase; (ii) 3%
if shares are redeemed during the third or fourth year following purchase;
(iii) 2% if shares are redeemed during the fifth year following purchase; and
(iv) 1% if shares are redeemed during the sixth year following purchase. Class
B Shares are also subject to annual 12b-1 Plan expenses which are higher than
those to which Class A Shares are subject and are assessed against the Class B
Shares for approximately eight years after purchase.
Class C Shares are purchased at net asset value and are subject to a
CDSC of 1% if shares are redeemed within twelve months following purchase.
Class C Shares are also subject to annual 12b-1 Plan expenses for the life of
the investment which are equal to those to which Class B Shares are subject.
Institutional Class shares are purchased at the net asset value per
share without the imposition of a front-end or sales charge, CDSC or 12b-1 Plan
expenses.
Institutional Class shares, Class A Shares, Class B Shares and Class C
Shares represent a proportionate interest in the Fund's assets and will receive
a proportionate interest in the Fund's income, before application, as to the
Class A, Class B and Class C Shares, of any expenses under the Fund's 12b-1
Plans.
See Automatic Conversion of Class B Shares under Buying Shares in the
Fund Classes' Prospectus, and Determining Offering Price and Net Asset Value
and Plans Under Rule 12b-1 for the Fund Classes in this Part B.
Certificates representing shares purchased are not ordinarily issued
unless a shareholder submits a specific request. Certificates are not issued
in the case of Class B Shares or Class C Shares. However, purchases not
involving the issuance of certificates are confirmed to the investor and
credited to the shareholder's account on
-15-
<PAGE> 62
(SAI-DTF/PART B)
the books maintained by Delaware Service Company, Inc. (the "Transfer Agent").
The investor will have the same rights of ownership with respect to such shares
as if certificates had been issued. An investor that is permitted to obtain a
certificate may receive a certificate representing shares purchased by sending
a letter to the Transfer Agent requesting the certificate. No charge is made
for any certificate issued. Investors who hold certificates representing any
of their shares may only redeem those shares by written request. The
investor's certificate(s) must accompany such request.
ALTERNATIVE PURCHASE ARRANGEMENTS
The alternative purchase arrangements of Class A, Class B and Class C
Shares permit an investor to choose the method of purchasing shares that is
most suitable for his or her needs given the amount of their purchase, the
length of time they expect to hold their shares and other relevant
circumstances. Investors should determine whether, given their particular
circumstances, it is more advantageous to purchase Class A Shares and incur a
front-end sales charge and annual 12b-1 Plan expenses of up to a maximum of
.30% of the average daily net assets of Class A Shares or to purchase either
Class B or Class C Shares and have the entire initial purchase amount invested
in the Fund with the investment thereafter subject to a CDSC and annual 12b-1
Plan expenses. Class B Shares are subject to a CDSC if the shares are redeemed
within six years of purchase, and Class C Shares are subject to a CDSC if the
shares are redeemed within twelve months of purchase. Class B and Class C
Shares are each subject to annual 12b-1 Plan expenses of up to a maximum of 1%
(.25% of which are service fees to be paid to the Distributor, dealers or
others for providing personal service and/or maintaining shareholder accounts)
of average daily net assets of the respective Class. Class B Shares will
automatically convert to Class A Shares at the end of approximately eight years
after purchase and, thereafter, be subject to annual 12b-1 Plan expenses of up
to a maximum of .30% of average daily net assets of such shares. Unlike Class
B Shares, Class C Shares do not convert to another class.
CLASS A SHARES
Purchases of $100,000 or more of Class A Shares at the offering price
carry reduced front-end sales charges as shown in the accompanying table, and
may include a series of purchases over a 13-month period under a Letter of
Intention signed by the purchaser. See Special Purchase Features - Class A
Shares, below for more information on ways in which investors can avail
themselves of reduced front-end sales charges and other purchase features.
<TABLE>
<CAPTION>
Class A Shares
- -------------------------------------------------------------------------------------
Dealer's
Front-End Sales Charge as % of Concession***
Amount of Purchase Offering Amount as % of
Price Invested** Offering Price
- -------------------------------------------------------------------------------------
<S> <C> <C> <C>
Less than $100,000 4.75% 5.00% 4.00%
$100,000 but under $250,000 3.75 3.87 3.00
$250,000 but under $500,000 2.50 2.53 2.00
$500,000 but under $1,000,000* 2.00 2.04 1.60
</TABLE>
* There is no front-end sales charge on purchases of $1 million or more of
Class A Shares, but, under certain limited circumstances, a 1% CDSC may
apply upon redemption of such shares (the "Limited CDSC"). The Limited
CDSC that may be applicable arises only in the case of certain net asset
value purchases which have triggered the payment of a dealer's
commission.
** Based on the net asset value per share of Class A Shares as of the end of
the Fund's most recent fiscal year.
*** Financial institutions or their affiliated brokers may receive an agency
transaction fee in the percentages set forth above.
- -------------------------------------------------------------------------------
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<PAGE> 63
(SAI-DTF/PART B)
The Fund must be notified when a sale takes place which would qualify for the
reduced front-end sales charge on the basis of previous or current purchases.
The reduced front-end sales charge will be granted upon confirmation of the
shareholder's holdings by the Fund. Such reduced front-end sales charges are
not retroactive.
From time to time, upon written notice to all of its dealers, the Distributor
may hold special promotions for specified periods during which the Distributor
may reallow to dealers up to the full amount of the front-end sales charge
shown above. Dealers who receive 90% or more of the sales charge may be deemed
to be underwriters under the Securities Act of 1933.
-17-
<PAGE> 64
(SAI-DTF/PART B)
Certain dealers who enter into an agreement to provide extra training and
information on Delaware Group products and services and who increase sales of
Delaware Group funds may receive an additional concession of up to .15% of the
offering price in connection with sales of Class A Shares. Such dealers must
meet certain requirements in terms of organization and distribution
capabilities and their ability to increase sales. The Distributor should be
contacted for further information on these requirements as well as the basis
and circumstances upon which the additional concession will be paid.
Participating dealers may be deemed to have additional responsibilities under
the securities laws.
DEALER'S COMMISSION
For initial purchases of Class A Shares of $1,000,000 or more, a dealer's
commission may be paid by the Distributor to financial advisers through whom
such purchases are effected in accordance with the following schedule:
<TABLE>
<CAPTION>
DEALER'S
COMMISSION
----------
(as a percent-
AMOUNT age of amount
OF PURCHASE purchased)
- -----------
<S> <C>
Up to $2 million 1.00%
Next $1 million up to $3 million .75
Next $2 million up to $5 million .50
Amount over $5 million .25
</TABLE>
In determining a financial adviser's eligibility for the dealer's
commission, purchases of Class A Shares of other Delaware Group funds as to
which a Limited CDSC applies (see Redemption and Repurchase) may be aggregated
with those of the Class A Shares of the Fund. Financial advisers also may be
eligible for a dealer's commission in connection with certain purchases made
under a Letter of Intention or pursuant to an investor's Right of Accumulation.
Financial advisers should contact the Distributor concerning the applicability
and calculation of the dealer's commission in the case of combined purchases.
An exchange from other Delaware Group funds will not qualify for payment
of the dealer's commission, unless such exchange is from a Delaware Group fund
with assets as to which a dealer's commission or similar payment has not been
previously paid. The schedule and program for payment of the dealer's
commission are subject to change or termination at any time by the Distributor
in its discretion.
CONTINGENT DEFERRED SALES CHARGE - CLASS B SHARES AND CLASS C SHARES
Class B and Class C Shares are purchased without the imposition of a
front-end sales charge. Class B Shares redeemed within six years of purchase
may be subject to a CDSC at the rates set forth below, and Class C Shares
redeemed within twelve months of purchase may be subject to a CDSC of 1%. CDSC
fees are charged as a percentage of the dollar amount subject to the CDSC. The
charge will be assessed on an amount equal to the lesser of the net asset value
at the time of purchase of the shares being redeemed or the net asset value of
those shares at the time of redemption. No CDSC will be imposed on increases
in net asset value above the initial purchase price. In addition, no CDSC will
be assessed on redemptions of shares received through reinvestment of dividends
or capital gains distributions. See Waiver of CDSC - Class B and Class C
Shares under Redemption and Exchange in the Prospectus for the Fund Classes
for a list of the instances in which the CDSC is waived.
The following table sets forth the rates of the CDSC for Class B Shares
of the Fund:
<TABLE>
<CAPTION>
CONTINGENT DEFERRED
SALES CHARGE (AS A
PERCENTAGE OF
DOLLAR AMOUNT
YEAR AFTER PURCHASE MADE SUBJECT TO CHARGE)
- ------------------------ ------------------
<S> <C>
0-2 4%
3-4 3%
5 2%
6 1%
7 and thereafter None
</TABLE>
-18-
<PAGE> 65
(SAI-DTF/PART B)
During the seventh year after purchase and, thereafter, until converted
automatically into Class A Shares of the Fund, Class B Shares will still be
subject to the annual 12b-1 Plan expenses of up to 1% of average daily net
assets of those shares. At the end of approximately eight years after
purchase, the investor's Class B Shares will be automatically converted into
Class A Shares of the Fund. See Automatic Conversion of Class B Shares under
Buying Shares in the Fund Classes' Prospectus. Such conversion will constitute
a tax-free exchange for federal income tax purposes. See Taxes in the
Prospectus for the Fund Classes.
PLANS UNDER RULE 12b-1 FOR THE FUND CLASSES
Pursuant to Rule 12b-1 under the 1940 Act, the Fund has adopted a
separate plan for each of the Class A Shares, the Class B Shares and the Class
C Shares of the Fund (the "Plans"). Each Plan permits the Fund to pay for
certain distribution, promotional and related expenses involved in the
marketing of only the Class to which the Plan applies. The Plans do not apply
to the Institutional Class of shares. Such shares are not included in
calculating the Plans' fees, and the Plans are not used to assist in the
distribution and marketing of the Institutional Class shares. Shareholders of
the Institutional Class may not vote on matters affecting the Plans.
The Plans permit the Fund, pursuant to the Distribution Agreement, to
pay out of the assets of the Class A, Class B and Class C Shares monthly fees
to the Distributor for its services and expenses in distributing and promoting
sales of shares of such classes. These expenses include, among other things,
preparing and distributing advertisements, sales literature and prospectuses
and reports used for sales purposes, compensating sales and marketing
personnel, and paying distribution and maintenance fees to securities brokers
and dealers who enter into agreements with the Distributor. The Plan expenses
relating to the Class B Shares and Class C Shares are also used to pay the
Distributor for advancing the commission costs to dealers with respect to the
initial sale of such shares.
In addition, the Fund may make payments out of the assets of the Class
A, Class B and Class C Shares directly to other unaffiliated parties, such as
banks, who either aid in the distribution of shares of, or provide services to,
such classes.
The maximum aggregate fee payable by the Fund under the Plans, and the
Fund's Distribution Agreement, is on an annual basis up to .30% of the Class A
Shares' average daily net assets for the year, and up to 1% (.25% of which are
service fees to be paid to the Distributor, dealers and others for providing
personal service and/or maintaining shareholder accounts) of each of the Class
B Shares' and the Class C Shares' average daily net assets for the year. The
Fund's Board of Directors may reduce these amounts at any time.
Effective June 1, 1992, the Board of Directors has determined that the
annual fee, payable on a monthly basis, for the Class A Shares, under its Plan,
will be equal to the sum of: (i) the amount obtained by multiplying .30% by
the average daily net assets represented by shares of the Class A Shares that
were acquired by shareholders on or after June 1, 1992, and (ii) the amount
obtained by multiplying .10% by the average daily net assets represented by
shares of the Class A Shares that were acquired before June 1, 1992. While
this is the method for calculating the 12b-1 fees to be paid by the Class A
Shares, the fee is a Class expense so that all shareholders of that Class,
regardless of when they purchased their shares, will bear 12b-1 expenses at the
same per share rate. As Class A Shares are sold on or after June 1, 1992, the
initial rate of at least .10% will increase over time. Thus, as the proportion
of Class A Shares purchased on or after June 1, 1992 to Class A Shares
outstanding prior to June 1, 1992
-19-
<PAGE> 66
(SAI-DTF/PART B)
increases, the expenses attributable to payments under the Plan will also
increase (but will not exceed .30% of average daily net assets). While this
describes the current formula for calculating the fees which will be payable
under the Plan, the Plan permits the Fund to pay a full .30% on all Class A
Shares assets at any time.
All of the distribution expenses incurred by the Distributor and
others, such as broker/dealers, in excess of the amount paid on behalf of Class
A, Class B and Class C Shares would be borne by such persons without any
reimbursement from such classes. Subject to seeking best price and execution,
the Fund may, from time to time, buy or sell portfolio securities from or to
firms which receive payments under the Plans.
From time to time, the Distributor may pay additional amounts from its
own resources to dealers for aid in distribution or for aid in providing
administrative services to shareholders.
The Plans and the Distribution Agreement, as amended, have been
approved by the Board of Directors of the Fund, including a majority of the
directors who are not "interested persons" (as defined in the 1940 Act) of the
Fund and who have no direct or indirect financial interest in the Plans by vote
cast in person at a meeting duly called for the purpose of voting on the Plans
and such Distribution Agreement. Continuation of the Plans and the
Distribution Agreement, as amended, must be approved annually by the Board of
Directors in the same manner as specified above.
Each year, the directors must determine whether continuation of the
Plans is in the best interest of shareholders of, respectively, Class A Shares,
Class B Shares and Class C Shares and that there is a reasonable likelihood of
the Plan relating to a Fund Class providing a benefit to that Class. The Plans
and the Distribution Agreement, as amended, may be terminated at any time
without penalty by a majority of those directors who are not "interested
persons" or by a majority vote of the outstanding voting securities of the
relevant Fund Class. Any amendment materially increasing the percentage
payable under the Plans must likewise be approved by a majority vote of the
outstanding voting securities of the relevant Fund Class, as well as by a
majority vote of those directors who are not "interested persons." With
respect to the Class A Shares' Plan, any material increase in the maximum
percentage payable thereunder must also be approved by a majority of the
outstanding voting Class B Shares. Also, any other material amendment to the
Plans must be approved by a majority vote of the directors including a majority
of the noninterested directors of the Fund having no interest in the Plans. In
addition, in order for the Plans to remain effective, the selection and
nomination of directors who are not "interested persons" of the Fund must be
effected by the directors who themselves are not "interested persons" and who
have no direct or indirect financial interest in the Plans. Persons authorized
to make payments under the Plans must provide written reports at least
quarterly to the Board of Directors for their review.
For the fiscal year ended June 30, 1995, payments from the Class A
Shares pursuant to its Plan amounted to $671,067 and such payments were used
for the following purposes: Annual and Semi-Annual Reports - $23,141; Broker
Trails - $552,922; Commissions to Wholesalers - $73,738; Promotional-Broker
Meetings - $9,113; Promotional-Other - $15,052; Telephone - $2,095; Wholesaler
Expenses - $22,343; and Prospectus Printing - $2,663.
For the period September 6, 1994 (date of initial public offering)
through June 30, 1995, payments from the Class B Shares pursuant to its Plan
amounted to $16,004 and such payments were used for the following purposes:
Broker Sales Charges - $5,902; Commissions to Wholesalers - $815;
Promotional-Broker Meetings - $48; Telephone - $25; Interest on Broker Sales
Charges - $5,300; and Broker Trails - $3,914.
The staff of the Securities and Exchange Commission ("SEC") has
proposed amendments to Rule 12b-1 and other related regulations that could
impact Rule 12b-1 Distribution Plans. The Fund intends to amend the Plans, if
necessary, to comply with any new rules or regulations the SEC may adopt with
respect to Rule 12b-1.
-20-
<PAGE> 67
(SAI-DTF/PART B)
OTHER PAYMENTS TO DEALERS - CLASS A, CLASS B AND CLASS C SHARES
From time to time, at the discretion of the Distributor, all registered
broker/dealers whose aggregate sales of Fund Classes exceed certain limits as
set by the Distributor, may receive from the Distributor an additional payment
of up to .25% of the dollar amount of such sales. The Distributor may also
provide additional promotional incentives or payments to dealers that sell
shares of the Delaware Group of funds. In some instances, these incentives or
payments may be offered only to certain dealers who maintain, have sold or may
sell certain amounts of shares.
Payments to dealers made in connection with seminars, conferences or
contests relating to the promotion of fund shares may be in an amount up to
100% of the expenses incurred or awards made. The Distributor may also pay a
portion of the expense of preapproved dealer advertisements promoting the sale
of Delaware Group fund shares.
SPECIAL PURCHASE FEATURES - CLASS A SHARES
BUYING AT NET ASSET VALUE
Class A Shares may be purchased without a front-end sales charge under
the Dividend Reinvestment Plan and, under certain circumstances, the 12-Month
Reinvestment Privilege and the Exchange Privilege.
Current and former officers, directors and employees of the Fund, any
other fund in the Delaware Group, the Manager, or any of the Manager's
affiliates that may in the future be created, legal counsel to the funds and
registered representatives and employees of broker/dealers who have entered
into Dealer's Agreements with the Distributor may purchase Class A Shares and
any such class of shares of any of the funds in the Delaware Group, including
any fund that may be created, at the net asset value per share. Spouses,
parents, brothers, sisters and children (regardless of age) of such persons at
their direction, and any employee benefit plan established by any of the
foregoing funds, corporations, counsel or broker/dealers may also purchase
shares at net asset value. Purchases of Class A Shares may also be made by
clients of registered representatives of an authorized investment dealer at net
asset value within six months of a change of the registered representative's
employment, if the purchase is funded by proceeds from an investment where a
front-end sales charge has been assessed and the redemption of the investment
did not result in the imposition of a CDSC or other redemption charges.
Purchases of Class A Shares also may be made at net asset value by bank
employees who provide services in connection with agreements between the bank
and unaffiliated brokers or dealers concerning sales of Class A Shares.
Officers, directors and key employees of institutional clients of the Manager
or any of its affiliates, may purchase Class A Shares at net asset value.
Moreover, purchases may be effected at net asset value for the benefit of the
clients of brokers, dealers and registered investment advisers affiliated with
a broker or dealer, if such broker, dealer or investment adviser has entered
into an agreement with the Distributor providing specifically for the purchase
of Class A Shares in connection with special investment products, such as wrap
accounts or similar fee based programs. Such purchasers are
-21-
<PAGE> 68
(SAI-DTF/PART B)
required to sign a letter stating that the purchase is for investment only and
that the securities may not be resold except to the issuer. Such purchasers
may also be required to sign or deliver such other documents as the Fund may
reasonably require to establish eligibility for purchase at net asset value.
The Fund must be notified in advance that the trade qualifies for purchase at
net asset value.
Investments in Class A Shares made by plan level and/or participant
retirement accounts that are for the purpose of repaying a loan taken from such
accounts will be made at net asset value. Loan repayments made to a Delaware
Group account in connection with loans originated from accounts previously
maintained by another investment firm will also be invested at net asset value.
LETTER OF INTENTION
The reduced front-end sales charges described above with respect to
Class A Shares are also applicable to the aggregate amount of purchases made by
any such purchaser previously enumerated within a 13-month period pursuant to a
written Letter of Intention provided by the Distributor and signed by the
purchaser, and not legally binding on the signer or the Fund, which provides
for the holding in escrow by the Transfer Agent, of 5% of the total amount of
the Class A Shares intended to be purchased until such purchase is completed
within the 13-month period. A Letter of Intention may be dated to include
shares purchased up to ninety days prior to the date the Letter is signed. The
13-month period begins on the date of the earliest purchase. If the intended
investment is not completed, except as noted below, the purchaser will be asked
to pay an amount equal to the difference between the front-end sales charge on
the Class A Shares purchased at the reduced rate and the front-end sales charge
otherwise applicable to the total shares purchased. If such payment is not
made within twenty days following the expiration of the 13-month period, the
Transfer Agent will surrender an appropriate number of the escrowed shares for
redemption in order to realize the difference. Such purchasers may include the
value (at offering price at the level designated in their Letter of Intention)
of all their shares of the Fund and of any class of any of the other mutual
funds in the Delaware Group (except shares of any Delaware Group fund which do
not carry a front-end sales charge, CDSC or Limited CDSC, other than shares of
Delaware Group Premium Fund, Inc. beneficially owned in connection with the
ownership of variable insurance products, unless they were acquired through an
exchange from a Delaware Group fund which carried a front-end sales charge,
CDSC or Limited CDSC) previously purchased and still held as of the date of
their Letter of Intention toward the completion of such Letter. For purposes
of satisfying an investor's obligation under a Letter of Intention, Class B
Shares and Class C Shares of the Fund and the corresponding classes of shares
of other Delaware Group funds which offer such shares may be aggregated with
Class A Shares of the Fund and the corresponding class of shares of the other
Delaware Group funds.
Employers offering a Delaware Group retirement plan may also complete a
Letter of Intention to obtain a reduced front-end sales charge on investments
of Class A Shares made by the plan. The aggregate investment level of the
Letter of Intention will be determined and accepted by the Transfer Agent at
the point of plan establishment. The level and any reduction in front-end
sales charge will be based on actual plan participation and the projected
investments in Delaware Group funds that are offered with a front-end sales
charge, CDSC or Limited CDSC for a 13-month period. The Transfer Agent
reserves the right to adjust the signed Letter of Intention based on this
acceptance criteria. The 13-month period will begin on the date this Letter of
Intention is accepted by the Transfer Agent. If actual investments exceed the
anticipated level and equal an amount that would qualify the plan for further
discounts, any front-end sales charges will be automatically adjusted. In the
event this Letter of Intention is not fulfilled within the 13-month period, the
plan level will be adjusted
-22-
<PAGE> 69
(SAI-DTF/PART B)
(without completing another Letter of Intention) and the employer will be
billed for the difference in front-end sales charges due, based on the plan's
assets under management at that time. Employers may also include the value (at
offering price at the level designated in their Letter of Intention) of all
their shares intended for purchase that are offered with a front-end sales
charge, CDSC or Limited CDSC of any class. Class B Shares and Class C Shares
of the Fund and other Delaware Group funds which offer corresponding classes of
shares may also be aggregated for this purpose.
COMBINED PURCHASES PRIVILEGE
In determining the availability of the reduced front-end sales charge
previously set forth with respect to Class A Shares, purchasers may combine the
total amount of any combination of Class B Shares and/or Class C Shares of the
Fund, as well as shares of any other class of any of the other Delaware Group
funds (except shares of any Delaware Group fund which do not carry a front-end
sales charge, CDSC or Limited CDSC, other than shares of Delaware Group Premium
Fund, Inc. beneficially owned in connection with the ownership of variable
insurance products, unless they were acquired through an exchange from a
Delaware Group fund which carried a front-end sales charge, CDSC or Limited
CDSC).
The privilege also extends to all purchases made at one time by an
individual; or an individual, his or her spouse and their children under
twenty-one years of age; or a trustee or other fiduciary of trust estates or
fiduciary accounts for the benefit of such family members (including certain
employee benefit programs).
RIGHT OF ACCUMULATION
In determining the availability of the reduced front-end sales charge
with respect to Class A Shares, purchasers may also combine any subsequent
purchases of Class A Shares, Class B Shares and Class C Shares of the Fund as
well as shares of any other class of any of the other Delaware Group funds
which offer such classes (except shares of any Delaware Group fund which do not
carry a front-end sales charge, CDSC or Limited CDSC, other than shares of
Delaware Group Premium Fund, Inc. beneficially owned in connection with the
ownership of variable insurance products, unless they were acquired through an
exchange from a Delaware Group fund which carried a front-end sales charge,
CDSC or Limited CDSC). If, for example, any such purchaser has previously
purchased and still holds Class A Shares and/or shares of any other of the
classes described in the previous sentence with a value of $40,000 and
subsequently purchases $60,000 at offering price of additional shares of Class
A Shares, the charge applicable to the $60,000 purchase would currently be
3.75%. For the purpose of this calculation, the shares presently held shall be
valued at the public offering price that would have been in effect were the
shares purchased simultaneously with the current purchase. Investors should
refer to the table of sales charges for Class A Shares to determine the
applicability of the Right of Accumulation to their particular circumstances.
12-MONTH REINVESTMENT PRIVILEGE
Holders of Class A Shares (and of the Institutional Class holding
shares which were acquired through an exchange of one of the other mutual funds
in the Delaware Group offered with a front-end sales charge) who redeem such
shares of the Fund have one year from the date of redemption to reinvest all or
part of their redemption proceeds in Class A Shares of the Fund or in Class A
Shares of any of the other funds in the Delaware Group, subject to applicable
eligibility and minimum purchase requirements, in states where shares of such
other funds may be sold, at net asset value without the payment of a front-end
sales charge. This privilege does not extend to Class A Shares where the
redemption of the shares triggered the payment of a Limited CDSC. Persons
investing redemption proceeds from direct investments in mutual funds in the
Delaware Group offered without a front-end sales charge will be required to pay
the applicable sales charge when purchasing Class A
-23-
<PAGE> 70
(SAI-DTF/PART B)
Shares. The reinvestment privilege does not extend to a redemption of either
Class B or Class C Shares.
Any such reinvestment cannot exceed the redemption proceeds (plus any
amount necessary to purchase a full share). The reinvestment will be made at
the net asset value next determined after receipt of remittance. A redemption
and reinvestment could have income tax consequences. It is recommended that a
tax adviser be consulted with respect to such transactions. Any reinvestment
directed to a fund in which the investor does not then have an account will be
treated like all other initial purchases of a fund's shares. Consequently, an
investor should obtain and read carefully the prospectus for the fund in which
the investment is proposed to be made before investing or sending money. The
prospectus contains more complete information about the fund, including charges
and expenses.
Investors should consult their financial advisers or the Transfer
Agent, which also serves as the Fund's shareholder servicing agent, about the
applicability of the Limited CDSC (see Contingent Deferred Sales Charge for
Certain Purchases of Class A Shares Made at Net Asset Value under Redemption
and Exchange in the Fund Classes' Prospectus) in connection with the features
described above.
GROUP INVESTMENT PLANS
Group Investment Plans which are not eligible to purchase shares of the
Institutional Class may also benefit from the reduced front-end sales charges
for investments in Class A Shares set forth in the table on page _______, based
on total plan assets. If a company has more than one plan investing in the
Delaware Group of funds, then the total amount invested in all plans would be
used in determining the applicable front-end sales charge reduction upon each
purchase, both initial and subsequent, upon notification to the Fund at the
time of each such purchase. Employees participating in such Group Investment
Plans may also combine the investments made in their plan account when
determining the applicable front-end sales charge on purchases to
non-retirement Delaware Group investment accounts if they so notify the Fund in
connection with each purchase. For other retirement plans and special
services, see Retirement Plans for the Fund Classes under Investment Plans.
TREND FUND INSTITUTIONAL CLASS
The Institutional Class is available for purchase only by: (a)
retirement plans introduced by persons not associated with brokers or dealers
that are primarily engaged in the retail securities business and rollover
individual retirement accounts from such plans; (b) tax-exempt employee benefit
plans of the Manager or its affiliates and securities dealer firms with a
selling agreement with the Distributor; (c) institutional advisory accounts of
the Manager or its affiliates and those having client relationships with
Delaware Investment Advisers, a division of the Manager, or its affiliates and
their corporate sponsors, as well as subsidiaries and related employee benefit
plans and rollover individual retirement account from such institutional
advisory accounts; (d) banks, trust companies and similar financial
institutions investing for their own account or for the account of their trust
customers for whom such financial institution is exercising investment
discretion in purchasing shares of the Class; and (e) registered investment
advisers investing on behalf of clients that consist solely of institutions and
high net-worth individuals having at least $1,000,000 entrusted to the adviser
for investment purposes, but only if the adviser is not affiliated or
associated with a broker or dealer and derives compensation for its services
exclusively from its clients for such advisory services.
Shares of the Institutional Class are available for purchase at net
asset value, without the imposition of a front-end sales charge or CDSC and are
not subject to Rule 12b-1 expenses.
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(SAI-DTF/PART B)
INVESTMENT PLANS
REINVESTMENT PLAN/OPEN ACCOUNT
Unless otherwise designated by shareholders in writing, dividends from
net investment income and distributions from realized securities profits, if
any, will be automatically reinvested in additional shares of the respective
Fund Class in which an investor has an account (based on the net asset value in
effect on the reinvestment date) and will be credited to the shareholder's
account on that date. All dividends and distributions of the Institutional
Class are reinvested in the account of the holders of such shares (based on the
net asset value of the Fund in effect on the reinvestment date). A
confirmation of each dividend payment from net investment income and of
distributions from realized securities profits, if any, will be mailed to
shareholders in the first quarter of the fiscal year.
Under the Reinvestment Plan/Open Account, shareholders may purchase and
add full and fractional shares to their plan accounts at any time either
through their investment dealers or by sending a check or money order to the
Fund. Such purchases, which must meet the minimum subsequent purchase
requirements set forth in the Prospectuses and this Part B, are made for Class
A Shares at the public offering price and, for Class B Shares, Class C Shares
and Institutional Class at the net asset value, at the end of the day of
receipt. A reinvestment plan may be terminated at any time. This plan does
not assure a profit nor protect against depreciation in a declining market.
REINVESTMENT OF DIVIDENDS IN OTHER DELAWARE GROUP FUNDS
Subject to applicable eligibility and minimum initial purchase
requirements and the limitations set forth below, holders of Class A, Class B
and Class C Shares may automatically reinvest dividends and/or distributions
from the Fund in any of the other mutual funds in the Delaware Group, including
the Fund, in states where their shares may be sold. Such investments will be
at net asset value at the close of business on the reinvestment date without
any front-end sales charge or service fee. The shareholder must notify the
Transfer Agent in writing and must have established an account in the fund into
which the dividends and/or distributions are to be invested. Any reinvestment
directed to a fund in which the investor does not then have an account will be
treated like all other initial purchases of a fund's shares. Consequently, an
investor should obtain and read carefully the prospectus for the fund in which
the investment is proposed to be made before investing or sending money. The
prospectus contains more complete information about the fund, including charges
and expenses.
Subject to the following limitations, dividends and/or distributions
from other funds in the Delaware Group may be invested in shares of the Fund,
provided an account has been established. Dividends from Class A Shares may
not be directed to Class B Shares or Class C Shares of another fund in the
Delaware Group. Dividends from Class B Shares may only be directed to Class B
Shares of another fund in the Delaware Group that offers such class of shares.
Dividends from Class C Shares may only be directed to Class C Shares of another
fund in the Delaware Group that offers such class of shares. See Class B Funds
and Class C Funds under Buying Shares in the Fund Classes' Prospectus for the
funds in the Delaware Group that are eligible for investment by holders of Fund
shares.
This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans.
INVESTING BY ELECTRONIC FUND TRANSFER
Direct Deposit Purchase Plan--Investors may arrange for the Fund to
accept for investment in Class A, Class B or Class C Shares, through an agent
bank, preauthorized government or private recurring payments. This method of
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(SAI-DTF/PART B)
investment assures the timely credit to the shareholder's account of payments
such as social security, veterans' pension or compensation benefits, federal
salaries, Railroad Retirement benefits, private payroll checks, dividends, and
disability or pension fund benefits. It also eliminates lost, stolen and
delayed checks.
Automatic Investing Plan--Shareholders of Class A, Class B and Class C
Shares may make automatic investments by authorizing, in advance, monthly
payments directly from their checking account for deposit into their Fund
account. This type of investment will be handled in either of the two ways
noted below. (1) If the shareholder's bank is a member of the National
Automated Clearing House Association ("NACHA"), the amount of the investment
will be electronically deducted from his or her account by Electronic Fund
Transfer ("EFT"). The shareholder's checking account will reflect a debit each
month at a specified date although no check is required to initiate the
transaction. (2) If the shareholder's bank is not a member of NACHA,
deductions will be made by preauthorized checks, known as Depository Transfer
Checks. Should the shareholder's bank become a member of NACHA in the future,
his or her investments would be handled electronically through EFT.
This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans.
* * *
Investments under the Direct Deposit Purchase Plan and the Automatic
Investing Plan must be for $25 or more for Class A Shares and $100 or more for
Class B and Class C Shares. An investor wishing to take advantage of either
service must complete an authorization form. Either service can be
discontinued by the shareholder at any time without penalty by giving written
notice.
Payments to the Fund from the federal government or its agencies on
behalf of a shareholder may be credited to the shareholder's account after such
payments should have been terminated by reason of death or otherwise. Any such
payments are subject to reclamation by the federal government or its agencies.
Similarly, under certain circumstances, investments from private sources may be
subject to reclamation by the transmitting bank. In the event of a
reclamation, the Fund may liquidate sufficient shares from a shareholder's
account to reimburse the government or the private source. In the event there
are insufficient shares in the shareholder's account, the shareholder is
expected to reimburse the Fund.
DIRECT DEPOSIT PURCHASES BY MAIL
Shareholders may authorize a third party, such as a bank or employer,
to make investments directly to their Fund accounts. The Fund will accept
these investments, such as bank-by-phone, annuity payments and payroll
allotments, by mail directly from the third party. Investors should contact
their employers or financial institutions who in turn should contact the Fund
for proper instructions.
RETIREMENT PLANS FOR THE FUND CLASSES
An investment in the Fund may be suitable for tax-deferred retirement
plans. Among the retirement plans noted below, Class B Shares are available
for investment only by Individual Retirement Accounts, Simplified Employee
Pension Plans, 457 Deferred Compensation Plans and 403(b)(7) Deferred
Compensation Plans. The CDSC may be waived on certain redemptions of Class B
Shares and Class C Shares. See Waiver of CDSC - Class B and Class C Shares
under Redemption and Exchange in the Prospectus for the Fund Classes for a list
of the instances in which the CDSC is waived.
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(SAI-DTF/PART B)
Each purchase of Class B Shares is subject to a maximum purchase
limitation of $250,000 for retirement plans. Each purchase of Class C Shares
must be in an amount that is less than $1,000,000 for such plans. The maximum
purchase limitations apply only to the initial purchase of shares by the
retirement plan.
Minimum investment limitations generally applicable to other investors
do not apply to retirement plans other than Individual Retirement Accounts
("IRAs"), for which there is a minimum initial purchase of $250 and a minimum
subsequent purchase of $25 regardless of which Class is selected. Retirement
plans may be subject to plan establishment fees, annual maintenance fees and/or
other administrative or trustee fees. Fees are based upon the number of
participants in the plan as well as the services selected. Additional
information about fees is included in retirement plan materials. Fees are
quoted upon request. Annual maintenance fees may be shared by Delaware
Management Trust Company, the Transfer Agent, other affiliates of the Manager
and others that provide services to such Plans.
Certain shareholder investment services available to non-retirement
plan shareholders may not be available to retirement plan shareholders.
Certain retirement plans may qualify to purchase shares of the Institutional
Class. See Trend Fund Institutional Class above. For additional information
on any of the plans and Delaware's retirement services, call the Shareholder
Service Center telephone number.
IT IS ADVISABLE FOR AN INVESTOR CONSIDERING ANY ONE OF THE RETIREMENT
PLANS DESCRIBED BELOW TO CONSULT WITH AN ATTORNEY, ACCOUNTANT OR A QUALIFIED
RETIREMENT PLAN CONSULTANT. FOR FURTHER DETAILS, INCLUDING APPLICATIONS FOR
ANY OF THESE PLANS, CONTACT YOUR INVESTMENT DEALER OR THE DISTRIBUTOR.
Taxable distributions from the retirement plans described below may be
subject to withholding.
Please contact your investment dealer or the Distributor for the
special application forms required for the Plans described below.
PROTOTYPE PROFIT SHARING OR MONEY PURCHASE PENSION PLANS
Prototype Plans are available for self-employed individuals,
partnerships and corporations which replace the former Keogh and corporate
retirement plans. These plans contain profit sharing or money purchase pension
plan provisions. Contributions may be invested only in Class A and Class C
Shares.
INDIVIDUAL RETIREMENT ACCOUNT ("IRA")
A document is available for an individual who wants to establish an IRA
by making contributions which may be tax-deductible, even if the individual is
already participating in an employer-sponsored retirement plan. Even if
contributions are not deductible for tax purposes, as indicated below, earnings
will be tax-deferred. In addition, an individual may make contributions on
behalf of a spouse who has no compensation for the year or elects to be treated
as having no compensation for the year. Investments in each of the Fund
Classes are permissible.
The Tax Reform Act of 1986 (the "Act") restructured, and in some cases
eliminated, the tax deductibility of IRA contributions. Under the Act, the
full deduction for IRAs ($2,000 for each
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(SAI-DTF/PART B)
working spouse and $2,250 for one-income couples) was retained for all
taxpayers who are not covered by an employer-sponsored retirement plan. Even
if a taxpayer (or his or her spouse) is covered by an employer-sponsored
retirement plan, the full deduction is still available if the taxpayer's
adjusted gross income is below $25,000 ($40,000 for taxpayers filing joint
returns). A partial deduction is allowed for married couples with incomes
between $40,000 and $50,000, and for single individuals with incomes between
$25,000 and $35,000. The Act does not permit deductions for contributions to
IRAs by taxpayers whose adjusted gross income before IRA deductions exceeds
$50,000 ($35,000 for singles) and who are active participants in an
employer-sponsored retirement plan. Taxpayers who are not allowed deductions
on IRA contributions still can make nondeductible IRA contributions of as much
as $2,000 for each working spouse ($2,250 for one-income couples), and defer
taxes on interest or other earnings from the IRAs. Special rules apply for
determining the deductibility of contributions made by married individuals
filing separate returns.
A company or association may establish a Group IRA for employees or
members who want to purchase shares of the Fund. Purchases of $1 million or
more of Class A Shares qualify for purchase at net asset value but may, under
certain circumstances, be subject to a Limited CDSC. See Purchasing Shares
concerning reduced front-end sales charges applicable to Class A Shares.
Investments generally must be held in the IRA until age 59 1/2 in order
to avoid premature distribution penalties, but distributions generally must
commence no later than April 1 of the calendar year following the year in which
the participant reaches age 70 1/2. Individuals are entitled to revoke the
account, for any reason and without penalty, by mailing written notice of
revocation to Delaware Management Trust Company within seven days after the
receipt of the IRA Disclosure Statement or within seven days after the
establishment of the IRA, except, if the IRA is established more than seven
days after receipt of the IRA Disclosure Statement, the account may not be
revoked. Distributions from the account (except for the pro-rata portion of
any nondeductible contributions) are fully taxable as ordinary income in the
year received. Excess contributions removed after the tax filing deadline,
plus extensions, for the year in which the excess contributions were made are
subject to a 6% excise tax on the amount of excess. Premature distributions
(distributions made before age 59 1/2, except for death, disability and certain
other limited circumstances) will be subject to a 10% excise tax on the amount
prematurely distributed, in addition to the income tax resulting from the
distribution. See Class B Shares and Class C Shares under Alternative Purchase
Arrangements in the Fund Classes' Prospectus concerning the applicability of a
CDSC upon redemption.
See Appendix B for additional IRA information.
SIMPLIFIED EMPLOYEE PENSION PLAN ("SEP/IRA")
A SEP/IRA may be established by an employer who wishes to sponsor a
tax-sheltered retirement program by making contributions on behalf of all
eligible employees. Each of the Fund Classes is available for investment by a
SEP/IRA.
SALARY REDUCTION SIMPLIFIED EMPLOYEE PENSION PLAN ("SAR/SEP")
Employers with twenty-five or fewer eligible employees can establish
this plan which permits employer contributions and salary deferral
contributions in Class A Shares and Class C Shares only.
PROTOTYPE 401(k) DEFINED CONTRIBUTION PLAN
Section 401(k) of the Code permits employers to establish qualified
plans based on salary deferral contributions. Plan documents are available to
enable employers to establish a plan. An employer may also elect to make
profit sharing contributions and/or matching contributions with investments in
only Class A Shares and Class C
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(SAI-DTF/PART B)
Shares or certain other funds in the Delaware Group. Purchases under the plan
may be combined for purposes of computing the reduced front-end sales charge
applicable to Class A Shares as set forth in the table on page _____.
DEFERRED COMPENSATION PLAN FOR PUBLIC SCHOOLS AND NON-PROFIT ORGANIZATIONS
("403(b)(7)")
Section 403(b)(7) of the Code permits public school systems and certain
non-profit organizations to use mutual fund shares held in a custodial account
to fund deferred compensation arrangements for their employees. A custodial
account agreement is available for those employers who wish to purchase any of
the Fund Classes in conjunction with such an arrangement. Applicable front-end
sales charges with respect to Class A Shares for such purchases are set forth
in the table on page _____.
DEFERRED COMPENSATION PLAN FOR STATE AND LOCAL GOVERNMENT EMPLOYEES ("457")
Section 457 of the Code permits state and local governments, their
agencies and certain other entities to establish a deferred compensation plan
for their employees who wish to participate. This enables employees to defer a
portion of their salaries and any federal (and possibly state) taxes thereon.
Such plans may invest in shares of any of the Fund Classes. Although investors
may use their own plan, there is available a Delaware Group 457 Deferred
Compensation Plan. Interested investors should contact the Distributor or
their investment dealers to obtain further information. Applicable front-end
sales charges for such purchases of Class A Shares are set forth in the table
on page _____.
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<PAGE> 76
(SAI-DTF/PART B)
DETERMINING OFFERING PRICE AND NET ASSET VALUE
Orders for purchases of Class A Shares are effected at the offering
price next calculated by the Fund after receipt of the order by the Fund or its
agent. Orders for purchases of Class B Shares, Class C Shares and the
Institutional Class are effected at the net asset value per share next
calculated after receipt of the order by the Fund or its agent. Selling
dealers have the responsibility of transmitting orders promptly.
The offering price for Class A Shares consists of the net asset value
per share plus any applicable sales charges. Offering price and net asset
value are computed as of the close of regular trading on the New York Stock
Exchange (ordinarily, 4 p.m., Eastern time) on days when the Exchange is open.
The New York Stock Exchange is scheduled to be open Monday through Friday
throughout the year except for New Year's Day, Presidents' Day, Good Friday,
Memorial Day, Independence Day, Labor Day, Thanksgiving and Christmas. When
the New York Stock Exchange is closed, the Fund will generally be closed,
pricing calculations will not be made and purchase and redemption orders will
not be processed.
An example showing how to calculate the net asset value per share and,
in the case of Class A Shares, the offering price per share, is included in the
Fund's financial statements which are incorporated by reference into this Part
B.
The Fund's net asset value per share is computed by adding the value of
all the securities and other assets in the portfolio, deducting any liabilities
and dividing by the number of shares outstanding. Expenses and fees are
accrued daily. In determining the Fund's total net assets, portfolio
securities primarily listed or traded on a national securities exchange, except
for bonds, are valued at the last sale price on that exchange. Securities not
traded on a particular day, over-the-counter securities and government and
agency securities are valued at the mean value between bid and asked prices.
Money market instruments having a maturity of less than sixty days are valued
at amortized cost. Debt securities (other than short-term obligations) are
valued on the basis of valuations provided by a pricing service when such
prices are believed to reflect the fair value of such securities. Use of a
pricing service has been approved by the Board of Directors. Prices provided
by a pricing service take into account appropriate factors such as
institutional trading in similar groups of securities, yield, quality, coupon
rate, maturity, type of issue, trading characteristics and other market data.
Subject to the foregoing, securities for which market quotations are not
readily available and other assets are valued at fair value as determined in
good faith and in a method approved by the Board of Directors.
Each Class of the Fund will bear, pro-rata, all of the common expenses
of the Fund. The net asset values of all outstanding shares of each Class of
the Fund will be computed on a pro-rata basis for each outstanding share based
on the proportionate participation in the Fund represented by the value of
shares of that Class. All income earned and expenses incurred by the Fund will
be borne on a pro-rata basis by each outstanding share of a Class, based on
each Class' percentage in the Fund represented by the value of shares of such
Classes, except that the Institutional Class will not incur any of the expenses
under the Fund's 12b-1 Plans and Class A, Class B and Class C Shares alone will
bear the 12b-1 Plan expenses payable under their respective Plans. Due to the
specific distribution expenses and other costs that will be allocable to each
Class, the net asset value of each Class of the Fund will vary.
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(SAI-DTF/PART B)
REDEMPTION AND REPURCHASE
Any shareholder may require the Fund to redeem shares by sending a
WRITTEN REQUEST, signed by the record owner or owners exactly as the shares are
registered, to the Fund, 1818 Market Street, Philadelphia, PA 19103. In
addition, certain expedited redemption methods described below are available
when stock certificates have not been issued. The Fund does not issue
certificates for Class A Shares or Institutional Class shares, unless a
shareholder specifically requests them. The Fund does not issue certificates
for Class B Shares or Class C Shares. If stock certificates have been issued
for shares being redeemed, they must accompany the written request. For
redemptions of $50,000 or less paid to the shareholder at the address of
record, the Fund requires a request signed by all owners of the shares or the
investment dealer of record, but does not require signature guarantees. When
the redemption is for more than $50,000, or if payment is made to someone else
or to another address, signatures of all record owners are required and a
signature guarantee may be required. Each signature guarantee must be supplied
by an eligible guarantor institution. The Fund reserves the right to reject a
signature guarantee supplied by an eligible institution based on its
creditworthiness. The Fund may request further documentation from
corporations, retirement plans, executors, administrators, trustees or
guardians.
In addition to redemption of shares by the Fund, the Distributor,
acting as agent of the Fund, offers to repurchase Fund shares from
broker/dealers acting on behalf of shareholders. The redemption or repurchase
price, which may be more or less than the shareholder's cost, is the net asset
value per share next determined after receipt of the request in good order by
the Fund or its agent, less any applicable CDSC or Limited CDSC. This is
computed and effective at the time the offering price and net asset value are
determined. See Determining Offering Price and Net Asset Value. The Fund and
the Distributor end their business day at 5 p.m., Eastern time. This offer is
discretionary and may be completely withdrawn without further notice by the
Distributor.
Orders for the repurchase of Fund shares which are submitted to the
Distributor prior to the close of its business day will be executed at the net
asset value per share computed that day (subject to the applicable CDSC or
Limited CDSC), if the repurchase order was received by the broker/dealer from
the shareholder prior to the time the offering price and net asset value are
determined on such day. The selling dealer has the responsibility of
transmitting orders to the Distributor promptly. Such repurchase is then
settled as an ordinary transaction with the broker/dealer (who may make a
charge to the shareholder for this service) delivering the shares repurchased.
Certain redemptions of Class A Shares purchased at net asset value may
result in the imposition of a Limited CDSC. See Contingent Deferred Sales
Charge for Certain Purchases of Class A Shares Made at Net Asset Value under
Redemption and Exchange in the Prospectus for the Fund Classes. Class B Shares
are subject to a CDSC of: (i) 4% if shares are redeemed within two years of
purchase; (ii) 3% if shares are redeemed during the third or fourth year
following purchase; (iii) 2% if shares are redeemed during the fifth year
following purchase; and (iv) 1% if shares are redeemed during the sixth year
following purchase. Class C Shares are subject to a CDSC of 1% if shares are
redeemed within twelve months following purchase. See Contingent Deferred
Sales Charge under Buying Shares in the Prospectus for the Fund Classes.
Except for the applicable CDSC or Limited CDSC and, with respect to the
expedited payment by wire described below, for which there is currently a $7.50
bank wiring cost, neither the Fund nor the Distributor charges a fee for
redemptions or repurchases, but such fees could be charged at any time in the
future.
Payment for shares redeemed will ordinarily be mailed the next business
day, but in no case later than seven days, after receipt of a redemption
request in good order.
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(SAI-DTF/PART B)
If a shareholder who recently purchased shares by check seeks to redeem
all or a portion of those shares in a written request, the Fund will honor the
redemption request but will not mail the proceeds until it is reasonably
satisfied of the collection of the investment check. This potential delay can
be avoided by making investments by wiring Federal Funds.
If a shareholder has been credited with a purchase by a check which is
subsequently returned unpaid for insufficient funds or for any other reason,
the Fund will automatically redeem from the shareholder's account the shares
purchased by the check plus any dividends earned thereon. Shareholders may be
responsible for any losses to the Fund or to the Distributor.
In case of a suspension of the determination of the net asset value
because the New York Stock Exchange is closed for other than weekends or
holidays, or trading thereon is restricted or an emergency exists as a result
of which disposal by the Fund of securities owned by it is not reasonably
practical, or it is not reasonably practical for the Fund fairly to value its
assets, or in the event that the Securities and Exchange Commission has
provided for such suspension for the protection of shareholders, the Fund may
postpone payment or suspend the right of redemption or repurchase. In such
case, the shareholder may withdraw the request for redemption or leave it
standing as a request for redemption at the net asset value next determined
after the suspension has been terminated.
Payment for shares redeemed or repurchased may be made in either cash
or kind, or partly in cash and partly in kind. Any portfolio securities paid
or distributed in kind would be valued as described in Determining Offering
Price and Net Asset Value. Subsequent sale by an investor receiving a
distribution in kind could result in the payment of brokerage commissions.
However, the Fund has elected to be governed by Rule 18f-1 under the 1940 Act
pursuant to which the Fund is obligated to redeem shares solely in cash up to
the lesser of $250,000 or 1% of the net asset value of the Fund during any
90-day period for any one shareholder.
The value of the Fund's investments is subject to changing market
prices. Thus, a shareholder reselling shares to the Fund may sustain either a
gain or loss, depending upon the price paid and the price received for such
shares.
SMALL ACCOUNTS
Before the Fund involuntarily redeems shares from an account that under
the circumstances noted in the relevant Prospectus, has remained below the
minimum amounts required by the Fund's Prospectuses and sends the proceeds to
the shareholder, the shareholder will be notified in writing that the value of
the shares in the account is less than the minimum required and will be allowed
sixty days from the date of notice to make an additional investment to meet the
required minimum. See The Conditions of Your Purchase under Buying Shares in
the Prospectuses. Any redemption in an inactive account established with a
minimum investment may trigger mandatory redemption. No CDSC or Limited CDSC
will apply to the redemptions described in this paragraph.
Effective November 29, 1995, the minimum initial investment in Class A
Shares was increased from $250 to $1,000. Class A accounts that were
established prior to November 29, 1995 and maintain a balance in excess of $250
will not presently be subject to the $9 quarterly service fee that may be
assessed on accounts with balances below the stated minimum nor subject to
involuntary redemption.
* * *
The Fund has available certain redemption privileges, as described
below. The Fund reserves the right to suspend or terminate these expedited
payment procedures upon sixty days' written notice to shareholders.
EXPEDITED TELEPHONE REDEMPTIONS
Shareholders of the Fund Classes or their investment dealers of record
wishing to redeem any amount of shares of $50,000 or less for which
certificates have not been issued may call the Fund at 800-523-1918 (in
Philadelphia, 215-988-1241) or, in the case of shareholders of the
Institutional
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(SAI-DTF/PART B)
Class, their Client Services Representative at 800-828-5052 prior to the time
the offering price and net asset value are determined, as noted above, and have
the proceeds mailed to them at the record address. Checks payable to the
shareholder(s) of record will normally be mailed the next business day, but no
later than seven days, after the receipt of the redemption request. This
option is only available to individual, joint and individual fiduciary-type
accounts.
In addition, redemption proceeds of $1,000 or more can be transferred
to your predesignated bank account by wire or by check by calling the Fund, as
described above. An authorization form must have been completed by the
shareholder and filed with the Fund before the request is received. Payment
will be made by wire or check to the bank account designated on the
authorization form as follows:
1. PAYMENT BY WIRE: Request that Federal Funds be wired to the bank
account designated on the authorization form. Redemption proceeds will
normally be wired on the next business day following receipt of the redemption
request. There is a $7.50 wiring fee (subject to change) charged by CoreStates
Bank, N.A. which will be deducted from the withdrawal proceeds each time the
shareholder requests a redemption. If the proceeds are wired to the
shareholder's account at a bank which is not a member of the Federal Reserve
System, there could be a delay in the crediting of the funds to the
shareholder's bank account.
2. PAYMENT BY CHECK: Request a check be mailed to the bank account
designated on the authorization form. Redemption proceeds will normally be
mailed the next business day, but no later than seven days, from the date of
the telephone request. This procedure will take longer than the Payment by
Wire option (1 above) because of the extra time necessary for the mailing and
clearing of the check after the bank receives it.
REDEMPTION REQUIREMENTS: In order to change the name of the bank and
the account number it will be necessary to send a written request to the Fund
and a signature guarantee may be required. Each signature guarantee must be
supplied by an eligible guarantor institution. The Fund reserves the right to
reject a signature guarantee supplied by an eligible institution based on its
creditworthiness.
To reduce the shareholder's risk of attempted fraudulent use of the
telephone redemption procedure, payment will be made only to the bank account
designated on the authorization form.
The Fund will not honor telephone redemptions for Fund shares recently
purchased by check unless it is reasonably satisfied that the purchase check
has cleared.
If expedited payment under these procedures could adversely affect the
Fund, the Fund may take up to seven days to pay the shareholder.
Neither the Fund nor the Transfer Agent is responsible for any
shareholder loss incurred in acting upon written or telephone instructions for
redemption or exchange of Fund shares which are reasonably believed to be
genuine. With respect to such telephone transactions, the Fund will follow
reasonable procedures to confirm that instructions communicated by telephone
are genuine (including verification of a form of personal identification) as,
if it does not, the Fund or the Transfer Agent may be liable for any losses due
to unauthorized or fraudulent transactions. Telephone instructions received by
shareholders of the Fund Classes are generally tape recorded. A written
confirmation will be provided for all purchase, exchange and redemption
transactions initiated by telephone.
SYSTEMATIC WITHDRAWAL PLANS
Shareholders of Class A, Class B and Class C Shares who own or purchase
$5,000 or more of shares at the offering price, or net asset value, as
applicable, for which certificates have not been issued may establish a
Systematic Withdrawal Plan for monthly withdrawals of $25 or more, or quarterly
withdrawals of $75 or more, although the Fund does not recommend any specific
amount of withdrawal. This $5,000 minimum does not apply
-33-
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(SAI-DTF/PART B)
for the Fund's prototype retirement plans. Shares purchased with the initial
investment and through reinvestment of cash dividends and realized securities
profits distributions will be credited to the shareholder's account and
sufficient full and fractional shares will be redeemed at the net asset value
calculated on the third business day preceding the mailing date.
Checks are dated either the 1st or the 15th of the month, as selected
by the shareholder (unless such date falls on a holiday or a weekend) and are
normally mailed within two business days. Both ordinary income dividends and
realized securities profits distributions will be automatically reinvested in
additional shares of the Class at net asset value. This plan is not
recommended for all investors and should be started only after careful
consideration of its operation and effect upon the investor's savings and
investment program. To the extent that withdrawal payments from the plan
exceed any dividends and/or realized securities profits distributions paid on
shares held under the plan, the withdrawal payments will represent a return of
capital, and the share balance may in time be depleted, particularly in a
declining market.
The sale of shares for withdrawal payments constitutes a taxable event
and a shareholder may incur a capital gain or loss for federal income tax
purposes. This gain or loss may be long-term or short-term depending on the
holding period for the specific shares liquidated. Premature withdrawals from
retirement plans may have adverse tax consequences.
Withdrawals under this plan by the holders of Class A Shares or any
similar plan of any other investment company charging a front-end sales charge
made concurrently with the purchases of Class A Shares of this or the shares of
any other investment company will ordinarily be disadvantageous to the
shareholder because of the payment of duplicative sales charges. Shareholders
should not purchase Class A Shares while participating in a Systematic
Withdrawal Plan and a periodic investment program in a fund managed by the
Manager must be terminated before a Systematic Withdrawal Plan can take effect,
except if the shareholder is a participant in one of our retirement plans or is
investing in Delaware Group funds which do not carry a sales charge. Also,
redemptions of Class A Shares pursuant to a Systematic Withdrawal Plan may be
subject to a Limited CDSC if the purchase was made at net asset value and a
dealer's commission has been paid on that purchase. Redemptions of Class B
Shares or Class C Shares pursuant to a Systematic Withdrawal Plan may be
subject to a CDSC, unless the annual amount selected to be withdrawn is less
than 12% of the account balance on the date that the Systematic Withdrawal Plan
was established. See Waiver of CDSC - Class B and Class C Shares and Waiver of
Limited CDSC - Class A Shares under Redemption and Exchange in the Prospectus
for the Fund Classes.
An investor wishing to start a Systematic Withdrawal Plan must complete
an authorization form. If the recipient of Systematic Withdrawal Plan payments
is other than the registered shareholder, the shareholder's signature on this
authorization must be guaranteed. Each signature guarantee must be supplied by
an eligible guarantor institution. The Fund reserves the right to reject a
signature guarantee supplied by an eligible institution based on its
creditworthiness. This plan may be terminated by the shareholder or the
Transfer Agent at any time by giving written notice.
The Systematic Withdrawal Plan is not available with respect to the
Institutional Class.
WEALTH BUILDER OPTION
Shareholders of the Fund Classes may elect to invest in one or more of
the other mutual funds in the Delaware Group through our Wealth Builder Option.
Under this automatic exchange program, shareholders can authorize regular
monthly investments (minimum of $100 per fund) to be liquidated from their
account and invested automatically into other mutual funds in the Delaware
Group, subject to the conditions and limitations set forth in the Fund Classes'
Prospectus. See Wealth Builder Option and Redemption and Exchange in the
Prospectus for the Fund Classes.
The investment will be made on the 20th day of each month (or, if the
fund selected is not open that day, the next business day) at the public
offering price or net asset value, as applicable, of
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(SAI-DTF/PART B)
the fund selected on the date of investment. No investment will be made for
any month if the value of the shareholder's account is less than the amount
specified for investment.
Periodic investment through the Wealth Builder Option does not insure
profits or protect against losses in a declining market. The price of the fund
into which investments are made could fluctuate. Since this program involves
continuous investment regardless of such fluctuating value, investors selecting
this option should consider their financial ability to continue to participate
in the program through periods of low fund share prices. This program involves
automatic exchanges between two or more fund accounts and is treated as a
purchase of shares of the fund into which investments are made through the
program. See Exchange Privilege for a brief summary of the tax consequences of
exchanges.
Shareholders can also use the Wealth Builder Option to invest in the
Fund Classes through regular liquidations of shares in their accounts in other
mutual funds in the Delaware Group, subject to the conditions and limitations
described in the Fund Classes' Prospectus. Shareholders can terminate their
participation at any time by written notice to the Fund.
This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans, 403(b)(7) Deferred Compensation Plans or 457
Deferred Compensation Plans. This option also is not available to shareholders
of the Institutional Class.
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<PAGE> 82
(SAI-DTF/PART B)
DIVIDENDS AND REALIZED SECURITIES PROFITS DISTRIBUTIONS
The Fund will make payments from its net investment income and net
realized securities profits, if any, twice a year. The first payment would be
made during the first quarter of the next fiscal year. The second payment
would be made near the end of the calendar year to comply with certain
requirements of the Internal Revenue Code of 1986, as amended (the "Code").
During the fiscal year ended June 30, 1995, distributions totaling $0.790 per
share of each of the Class A Shares and Institutional Class were paid from
realized securities profits. On August 7 1995, a distribution of $0.550 per
share of each Class was paid from realized securities profits to shareholders
of record July 28, 1995.
All dividends and any capital gains distributions will be automatically
reinvested for the shareholder in additional shares at net asset value unless,
in the case of shareholders in the Fund Classes, the shareholder requests in
writing that such dividends and/or distributions be paid in cash. Dividend
payments of $1.00 or less will be automatically reinvested, notwithstanding a
shareholder's election to receive dividends in cash. If such a shareholder's
dividends increase to greater than $1.00, the shareholder would have to file a
new election in order to begin receiving dividends in cash again.
Each Class of shares of the Fund will share proportionately in the
investment income and expenses of the Fund, except that Class A Shares, Class B
Shares and Class C Shares alone will incur distribution fees under their
respective 12b-1 Plans.
Any check in payment of dividends or other distributions which cannot
be delivered by the United States Post Office or which remains uncashed for a
period of more than one year may be reinvested in the shareholder's account at
the then-current net asset value and the dividend option may be changed from
cash to reinvest. The Fund may deduct from a shareholder's account the costs
of the Fund's effort to locate a shareholder if a shareholder's mail is
returned by the United States Post Office or the Fund is otherwise unable to
locate the shareholder or verify the shareholder's mailing address. These
costs may include a percentage of the account when a search company charges a
percentage fee in exchange for their location services.
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<PAGE> 83
(SAI-DTF/PART B)
TAXES
It is the Fund's policy to pay out substantially all net investment
income and net realized gains to shareholders to relieve the Fund of federal
income tax liability on that portion of its income paid to shareholders under
Subchapter M of the Code. The Fund has met these requirements in previous
years and intends to meet them this year. Such distributions are taxable as
ordinary income or capital gain to those shareholders who are liable for
federal income tax. The Fund also intends to meet the calendar year
distribution requirements imposed by the Code to avoid the imposition of a 4%
excise tax.
Distributions may also be subject to state and local taxes;
shareholders are advised to consult with their tax advisers in this regard.
Shares of the Fund will be exempt from Pennsylvania personal property taxes.
Dividends representing net investment income or short-term capital
gains are taxable to shareholders as ordinary income. Distributions of
long-term capital gains, if any, are taxable as long-term capital gain
regardless of the length of time an investor has held such shares, and these
gains are currently taxed at long-term capital gain rates. The tax status of
dividends and distributions will not be affected by whether they are paid in
cash or in additional shares. A portion of these distributions may be eligible
for the dividends-received deduction for corporations. The portion of
dividends paid by the Fund that so qualifies will be designated each year in a
notice mailed to the Fund's shareholders, and cannot exceed the gross amount of
dividends received by the Fund from domestic (U.S.) corporations that would
have qualified for the dividends-received deduction in the hands of the Fund if
the Fund was a regular corporation. The availability of the dividends-received
deduction is subject to certain holding period and debt financing restrictions
imposed under the Code on the corporation claiming the deduction. Advice as to
the tax status of each year's dividends and distributions, when paid, will be
mailed annually.
If the net asset value of shares were reduced below a shareholder's
cost by distribution of gain realized on sale of securities, such distribution
would be a return of investment though taxable as stated above. The Fund's
portfolio securities had an unrealized appreciation for tax purposes of
$70,753,748 as of June 30, 1995.
Prior to purchasing shares of the Fund, you should carefully consider
the impact of dividends or realized securities profits distributions which have
been declared but not paid. Any such dividends or realized securities profits
distributions paid shortly after a purchase of shares by an investor will have
the effect of reducing the per share net asset value of such shares by the
amount of the dividends or realized securities profits distributions. All or a
portion of such dividends or realized securities profits distributions,
although in effect a return of capital, are subject to taxes which may be at
ordinary income tax rates. The purchase of shares just prior to the
ex-dividend date has an adverse effect for income tax purposes.
-37-
<PAGE> 84
(SAI-DTF/PART B)
INVESTMENT MANAGEMENT AGREEMENT
The Manager, located at One Commerce Square, Philadelphia, PA 19103,
furnishes investment management services to the Fund, subject to the
supervision and direction of the Fund's Board of Directors.
The Manager and its predecessors have been managing the funds in the
Delaware Group since 1938. The aggregate assets of these funds on June 30,
1995 were approximately $9,916,645,000. Investment advisory services are also
provided to institutional accounts with assets on June 30, 1995 of
approximately $16,227,892,000.
The Investment Management Agreement for the Fund is dated April 3, 1995
and was approved by shareholders on March 29, 1995.
The Agreement has an initial term of two years and may be renewed each
year only so long as such renewal and continuance are specifically approved at
least annually by the Board of Directors or by vote of a majority of the
outstanding voting securities of the Fund, and only if the terms and the
renewal thereof have been approved by the vote of a majority of the directors
of the Fund who are not parties thereto or interested persons of any such
party, cast in person at a meeting called for the purpose of voting on such
approval. The Agreement is terminable without penalty on sixty days' notice by
the directors of the Fund or by the Manager. The Agreement will terminate
automatically in the event of its assignment.
The compensation paid by the Fund for investment management services is
equal to 1/16 of 1% per month (3/4 of 1% per year) of the Fund's average daily
net assets, less all directors' fees paid to the unaffiliated directors of the
Fund. This fee is higher than that paid by funds with comparable investment
objectives. On June 30, 1995, the total net assets of the Fund were
$379,544,514. Under the general supervision of the Board of Directors, the
Manager makes all investment decisions which are implemented by the Fund. The
Manager pays the salaries of all directors, officers and employees who are
affiliated with both the Manager and the Fund. Investment management fees paid
by the Fund during the past three fiscal years were $1,249,159 for 1993,
$2,006,549 for 1994 and $2,300,627 for 1995.
Except for those expenses borne by the Manager under the Investment
Management Agreement and the Distributor under the Distribution Agreement, the
Fund is responsible for all of its own expenses. Among others, these include
the Fund's proportionate share of rent and certain other administrative
expenses; the investment management fees; transfer and dividend disbursing
agent fees and costs; custodian expenses; federal and state securities
registration fees; proxy costs; and the costs of preparing prospectuses and
reports sent to shareholders. The ratio of expenses to average daily net
assets for Class A Shares for the fiscal year ended June 30, 1995 was 1.36%,
which reflects the impact of its 12b-1 Plan. The ratio of expenses to average
daily net assets for the Institutional Class was 1.12% for the fiscal year
ended June 30, 1995. The ratio of expenses to average daily net assets for the
Class B Shares for the period September 6, 1994 (date of initial public
offering) through June 30, 1995 was 2.12%, annualized. The Fund anticipates
that the ratio of expenses to average daily net assets of Class C Shares will
be identical to that of the Class B Shares.
By California regulation, the Manager is required to waive certain fees
and reimburse the Fund for certain expenses to the extent that the Fund's
annual operating expenses, exclusive of taxes, interest, brokerage commissions
and extraordinary expenses, exceed specified percentages of net assets. At
present, the most restrictive limit is 2 1/2% of the first $30 million of
average daily net assets, 2% of the next $70 million of average daily net
assets and 1 1/2% of any additional average daily net assets. For the fiscal
year ended June 30, 1995, no reimbursement was necessary or paid.
-38-
<PAGE> 85
(SAI-DTF/PART B)
DISTRIBUTION AND SERVICE
The Distributor, Delaware Distributors, L.P. (which formerly conducted
business as Delaware Distributors, Inc.), located at 1818 Market Street,
Philadelphia, PA 19103, serves as the national distributor of Fund shares under
a Distribution Agreement dated April 3, 1995, as amended on November 29, 1995.
The Distributor is an affiliate of the Manager and bears all of the costs of
promotion and distribution, except for payments by the Fund on behalf of Class
A Shares, Class B Shares and Class C Shares under their respective 12b-1 Plans.
Prior to January 3, 1995, Delaware Distributors, Inc. ("DDI") served as the
national distributor of the Fund's shares. On that date, Delaware
Distributors, L.P., a newly formed limited partnership, succeeded to the
business of DDI. All officers and employees of DDI became officers and
employees of Delaware Distributors, L.P. DDI is the corporate general partner
of Delaware Distributors, L.P. and both DDI and Delaware Distributors, L.P. are
indirect, wholly-owned subsidiaries of Delaware Management Holdings, Inc.
The Transfer Agent, Delaware Service Company, Inc., another affiliate
of the Manager located at 1818 Market Street, Philadelphia, PA 19103, serves as
the Fund's shareholder servicing, dividend disbursing and transfer agent
pursuant to a Shareholders Services Agreement dated June 29, 1988. The
Transfer Agent is also an indirect, wholly-owned subsidiary of Delaware
Management Holdings, Inc.
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<PAGE> 86
(SAI-DTF/PART B)
OFFICERS AND DIRECTORS
The business and affairs of the Fund are managed under the direction of
its Board of Directors.
Certain officers and directors of the Fund hold identical positions in
each of the other funds in the Delaware Group. On October 31, 1995, the Fund's
officers and directors owned less than 1% of the outstanding shares of the
Class A Shares and the Class B Shares and approximately 2.11% of the
outstanding shares of the Institutional Class.
As of October 31, 1995, the Fund believes the following accounts held
5% or more of the outstanding shares of, respectively, the Class A Shares,
Institutional Class and Class B Shares: Merrill, Lynch, Pierce, Fenner & Smith
Inc., Mutual Fund Operations, P.O. Box 41621, Jacksonville, FL 32203 held of
record for the benefit of others 2,281,255 shares (9.58%) of the outstanding
shares of the Class A Shares. Woodstock, c/o Wood County Trust Company, 181
2nd Street South, P.O. Box 8000, Wisconsin Rapids, WI 54495 held 639,714 shares
(14.07%); Iceberg & Company, By State Street Bank & Trust Company, P.O. Box
1992, Boston, MA 02105 held 551,707 shares (12.13%); Trustees for Harrah's
Entertainment, Savings and Retirement Plan, 1023 Cherry Road, Memphis, TN 38117
held 418,465 shares (9.20%); Fidelity Management Trust Company, FBO Delta
Family Care Savings Plan, Financial Operations, Stock Trading Location KW1C,
100 Magellan, 1st Fl., Covington, KY 41015, 381,115 shares (8.38%); Iceberg &
Company, By State Street Bank & Trust Company, Trust Glaxo Inc., Retirement
Plan, P.O. Box 1992, Boston, MA 02105 held 369,220 shares (8.12%); Bank of New
York Trst, First Hospital Corp. Retirement Plan, 1 Wall Street, Master
Trust/Custodian, New York, NY 10005 held 362,369 shares (7.97%); and Delaware
Management Company, Inc., Employee Profit Sharing Trust, 1818 Market Street,
Philadelphia, PA 19103 held 290,966 shares (6.39%) of the outstanding shares of
the Institutional Class. Shares held by Delaware Management Company, Inc.,
Employee Profit Sharing Trust are beneficially owned by the participants in the
plan. Merrill, Lynch, Pierce, Fenner & Smith Inc., Mutual Fund Operations,
Attention Book Entry, 4800 Deer Lake Drive East, 3rd Fl., Jacksonville, FL
32246 held of record for the benefit of others 72,126 shares (10.60%) of the
outstanding shares of the Class B Shares.
DMH Corp., Delaware Management Company, Inc., Delaware Distributors,
L.P., Delaware Distributors, Inc., Delaware Service Company, Inc., Delaware
Management Trust Company, Delaware International Holdings Ltd., Founders
Holdings, Inc., Delaware International Advisers Ltd. and Delaware Investment
Counselors, Inc. are direct or indirect, wholly-owned subsidiaries of Delaware
Management Holdings, Inc. ("DMH"). On April 3, 1995, a merger between DMH and
a wholly-owned subsidiary of Lincoln National Corporation ("Lincoln National")
was completed. In connection with the merger, a new Investment Management
Agreement between the Fund and the Manager was executed following shareholder
approval. DMH and the Manager are now wholly-owned subsidiaries, and subject to
the ultimate control, of Lincoln National. Lincoln National, with headquarters
in Fort Wayne, Indiana, is a diversified organization with operations in many
aspects of the financial services industry, including insurance and investment
management.
Directors and principal officers of the Fund are noted below along with
their ages and their business experience for the past five years. Unless
otherwise noted, the address of each officer and director is One Commerce
Square, Philadelphia, PA 19103.
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<PAGE> 87
(SAI-DTF/PART B)
*WAYNE A. STORK (58)
Chairman, President, Chief Executive Officer, Director and/or Trustee
of the Fund, each of the other sixteen funds in the Delaware
Group, Delaware Management Holdings, Inc. and Delaware Investment
Counselors, Inc.
Chairman, Chief Executive Officer, Chief Investment Officer and
Director of Delaware Management Company, Inc.
Chairman, Chief Executive Officer and Director of DMH Corp., Delaware
International Advisers Ltd., Delaware International Holdings Ltd.
and Founders Holdings, Inc.
Director of Delaware Distributors, Inc. and Delaware Service Company,
Inc.
During the past five years, Mr. Stork has served in various executive
capacities at different times within the Delaware organization.
WINTHROP S. JESSUP (50)
Executive Vice President of the Fund, fifteen other funds in the
Delaware Group (which excludes Delaware Pooled Trust, Inc.) and
Delaware Management Holdings, Inc.
President and Chief Executive Officer of Delaware Pooled Trust, Inc.
President and Director of Delaware Investment Counselors, Inc.
Executive Vice President and Director of DMH Corp., Delaware Management
Company, Inc., Delaware International Holdings Ltd. and Founders
Holdings, Inc.
Vice Chairman and Director of Delaware Distributors, Inc.
Vice Chairman of Delaware Distributors, L.P.
Director of Delaware Management Trust Company, Delaware Service
Company, Inc. and Delaware International Advisers Ltd.
During the past five years, Mr. Jessup has served in various executive
capacities at different times within the Delaware organization.
RICHARD G. UNRUH, JR. (56)
Executive Vice President of the Fund and each of the other sixteen
funds in the Delaware Group.
Executive Vice President and Director of Delaware Management Company,
Inc.
Senior Vice President of Delaware Management Holdings, Inc.
Director of Delaware International Advisers Ltd.
During the past five years, Mr. Unruh has served in various executive
capacities at different times within the Delaware organization.
- -----------------------------
*Director affiliated with the investment manager of the Fund and considered an
"interested person" as defined in the Investment Company Act of 1940.
-41-
<PAGE> 88
(SAI-DTF/PART B)
WALTER P. BABICH (68)
Director and/or Trustee of the Fund and each of the other sixteen funds
in the Delaware Group.
460 North Gulph Road, King of Prussia, PA 19406.
Board Chairman, Citadel Constructors, Inc.
From 1986 to 1988, Mr. Babich was a partner of Irwin & Leighton and
from 1988 to 1991, he was a partner of I&L Investors.
ANTHONY D. KNERR (56)
Director and/or Trustee of the Fund and each of the other sixteen funds
in the Delaware Group.
500 Fifth Avenue, New York, NY 10110.
Consultant, Anthony Knerr & Associates.
From 1982 to 1988, Mr. Knerr was Executive Vice President/Finance and
Treasurer of Columbia University, New York. From 1987 to 1989, he
was also a lecturer in English at the University. In addition,
Mr. Knerr was Chairman of The Publishing Group, Inc., New York,
from 1988 to 1990. Mr. Knerr founded The Publishing Group, Inc.
in 1988.
ANN R. LEVEN (55)
Director and/or Trustee of the Fund and each of the other sixteen funds
in the Delaware Group.
785 Park Avenue, New York, NY 10021.
Treasurer, National Gallery of Art.
From 1984 to 1990, Ms. Leven was Treasurer and Chief Fiscal Officer of
the Smithsonian Institution, Washington, DC, and from 1975 to
1994, she was Adjunct Professor of Columbia Business School.
W. THACHER LONGSTRETH (74)
Director and/or Trustee of the Fund and each of the other sixteen funds
in the Delaware Group.
1617 John F. Kennedy Boulevard, Philadelphia, PA 19103.
Vice Chairman, Packquisition Corp., a financial printing, commercial
printing and information processing firm.
Philadelphia City Councilman.
President, MLW, Associates.
Director, Tasty Baking Company.
Director, Healthcare Services Group.
CHARLES E. PECK (69)
Director and/or Trustee of the Fund and each of the other sixteen funds
in the Delaware Group.
P.O. Box 1102, Columbia, MD 21044.
Secretary, Enterprise Homes, Inc.
From 1981 to 1990, Mr. Peck was Chairman and Chief Executive Officer of
The Ryland Group, Inc., Columbia, MD.
DAVID K. DOWNES (55)
Senior Vice President/Chief Administrative Officer/Chief Financial
Officer of the Fund, each of the other sixteen funds in the
Delaware Group and Delaware Management Company, Inc.
Chairman and Director of Delaware Management Trust Company.
Senior Vice President/Chief Administrative Officer/Chief Financial
Officer/Treasurer of Delaware Management Holdings, Inc.
Senior Vice President/Chief Financial Officer/Treasurer and Director of
DMH Corp.
Senior Vice President/Chief Administrative Officer/Chief Financial
Officer and Director of Delaware Service Company, Inc.
Senior Vice President/Chief Administrative Officer and Director of
Delaware Distributors, Inc.
Senior Vice President/Chief Administrative Officer of Delaware
Distributors, L.P.
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<PAGE> 89
(SAI-DTF/PART B)
Chief Financial Officer and Director of Delaware International Holdings
Ltd.
Senior Vice President/Chief Financial Officer/Treasurer of Delaware
Investment Counselors, Inc.
Senior Vice President and Director of Founders Holdings, Inc.
Director of Delaware International Advisers Ltd.
Before joining the Delaware Group in 1992, Mr. Downes was Chief
Administrative Officer, Chief Financial Officer and Treasurer of
Equitable Capital Management Corporation, New York, from December
1985 through August 1992, Executive Vice President from December
1985 through March 1992, and Vice Chairman from March 1992 through
August 1992.
GEORGE M. CHAMBERLAIN, JR. (48)
Senior Vice President and Secretary of the Fund, each of the other
sixteen funds in the Delaware
Group, Delaware Management Holdings, Inc., Delaware Distributors,
L.P. and Delaware Investment Counselors, Inc.
Executive Vice President, Secretary and Director of Delaware Management
Trust Company.
Senior Vice President, Secretary and Director of DMH Corp., Delaware
Management Company, Inc., Delaware Distributors, Inc. and Delaware
Service Company, Inc.
Corporate Vice President, Secretary and Director of Founders Holdings,
Inc.
Secretary and Director of Delaware International Holdings Ltd.
Director of Delaware International Advisers Ltd.
Attorney.
During the past five years, Mr. Chamberlain has served in various
capacities at different times within the Delaware organization.
EDWARD N. ANTOIAN (39)
Vice President/Senior Portfolio Manager of the Fund, of seven other
equity funds in the Delaware Group and of Delaware Management
Company, Inc.
During the past five years, Mr. Antoian has served in such capacities
within the Delaware organization.
JOSEPH H. HASTINGS (45)
Vice President/Corporate Controller of the Fund, each of the other
sixteen funds in the Delaware Group, Delaware Management
Holdings, Inc., DMH Corp., Delaware Management Company, Inc.,
Delaware Distributors, L.P., Delaware Distributors, Inc.,
Delaware Service Company, Inc., Delaware Investment Counselors,
Inc. and Founders Holdings, Inc.
Executive Vice President/Treasurer/Chief Financial Officer of Delaware
Management Trust Company.
Assistant Treasurer of Founders CBO Corporation.
1818 Market Street, Philadelphia, PA 19103.
Before joining the Delaware Group in 1992, Mr. Hastings was Chief
Financial Officer for Prudential Residential Services, L.P., New
York, NY from 1989 to 1992. Prior to that, Mr. Hastings served as
Controller and Treasurer for Fine Homes International, L.P.,
Stamford, CT from 1987 to 1989.
MICHAEL P. BISHOF (33)
Vice President/Treasurer of the Fund, each of the other sixteen funds
in the Delaware Group, Delaware Management Company, Inc.,
Delaware Distributors, L.P., Delaware Distributors, Inc.,
Delaware Service Company, Inc., Founders Holdings, Inc. and
Founders CBO Corporation.
Before joining the Delaware Group in 1995, Mr. Bishof was a Vice
President for Bankers Trust, New York, NY from 1994 to 1995, a
Vice President for CS First Boston Investment Management, New
York, NY from 1993 to 1994 and an Assistant Vice President for
Equitable Capital Management Corporation, New York, NY from 1987
to 1993.
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<PAGE> 90
(SAI-DTF/PART B)
The following is a compensation table listing for each director
entitled to receive compensation, the aggregate compensation received from the
Fund and the total compensation received from all Delaware Group funds for the
fiscal year ended June 30, 1995 and an estimate of annual benefits to be
received upon retirement under the Delaware Group Retirement Plan for
Directors/Trustees as of June 30, 1995.
<TABLE>
<CAPTION>
PENSION OR
RETIREMENT ESTIMATED TOTAL
BENEFITS ANNUAL COMPENSATION
AGGREGATE ACCRUED BENEFITS FROM ALL 17
COMPENSATION AS PART OF UPON DELAWARE
NAME FROM FUND FUND EXPENSES RETIREMENT* GROUP FUNDS
<S> <C> <C> <C> <C>
W. Thacher Longstreth $1,874.54 None $18,100 $47,187.96
Ann R. Leven $2,170.84 None $18,100 $55,323.95
Walter P. Babich $2,171.30 None $18,100 $55,323.04
Anthony D. Knerr $1,205.90 None $18,100 $32,996.57
Charles E. Peck $1,716.54 None $18,100 $44,052.00
</TABLE>
* Under the terms of the Delaware Group Retirement Plan for
Directors/Trustees, each disinterested director who, at the time of his or
her retirement from the Board, has attained the age of seventy years and
served on the Board for at least five continuous years, is entitled to
receive payments from each fund in the Delaware Group for a period equal
to the lesser of the number of years that such person served as a director
or the remainder of such person's life. The amount of such payments will
be equal, on an annual basis, to the amount of the annual retainer that is
paid to directors of each fund at the time of such person's retirement.
If an eligible director retired as of June 30, 1995, he or she would be
entitled to annual payments totaling $18,100, in the aggregate, from all
of the funds in the Delaware Group, based on the number of funds in the
Delaware Group as of that date.
-44-
<PAGE> 91
(SAI-DTF/PART B)
EXCHANGE PRIVILEGE
The exchange privileges available for shareholders of the Classes and
for shareholders of classes of other funds in the Delaware Group are set forth
in the relevant prospectuses for such classes. The following supplements that
information. The Fund reserves the right to reject exchange requests at any
time. The Fund may modify, terminate or suspend the exchange privilege upon
sixty days' notice to shareholders.
All exchanges involve a purchase of shares of the fund into which the
exchange is made. As with any purchase, an investor should obtain and
carefully read that fund's prospectus before buying shares in an exchange. The
prospectus contains more complete information about the fund, including charges
and expenses. A shareholder requesting an exchange will be sent a current
prospectus and an authorization form for any of the other mutual funds in the
Delaware Group. Exchange instructions must be signed by the record owner(s)
exactly as the shares are registered.
An exchange constitutes, for tax purposes, the sale of one fund and the
purchase of another. The sale may involve either a capital gain or loss to the
shareholder for federal income tax purposes.
In addition, investment advisers and dealers may make exchanges between
funds in the Delaware Group on behalf of their clients by telephone or other
expedited means. This service may be discontinued or revised at any time by
the Transfer Agent. Such exchange requests may be rejected if it is determined
that a particular request or the total requests at any time could have an
adverse effect on any of the funds. Requests for expedited exchanges may be
submitted with a properly completed exchange authorization form, as described
above.
TELEPHONE EXCHANGE PRIVILEGE
Shareholders owning shares for which certificates have not been issued
or their investment dealers of record may exchange shares by telephone for
shares in other mutual funds in the Delaware Group. This service is
automatically provided unless the Fund receives written notice from the
shareholder to the contrary.
Shareholders or their investment dealers of record may contact the
Transfer Agent at 800-523-1918 (in Philadelphia, 215-988-1241) or, in the case
of shareholders of the Institutional Class, their Client Services
Representative at 800-828-5052, to effect an exchange. The shareholder's
current Fund account number must be identified, as well as the registration of
the account, the share or dollar amount to be exchanged and the fund into which
the exchange is to be made. Requests received on any day after the time the
offering price and net asset value are determined will be processed the
following day. See Determining Offering Price and Net Asset Value. Any new
account established through the exchange will automatically carry the same
registration, shareholder information and dividend option as the account from
which the shares were exchanged. The exchange requirements of the fund into
which the exchange is being made, such as sales charges, eligibility and
investment minimums, must be met. (See the prospectus of the fund desired or
inquire by calling the Transfer Agent or, as relevant, your Client Services
Representative.) Certain funds are not available for Retirement Plans.
The telephone exchange privilege is intended as a convenience to
shareholders and is not intended to be a vehicle to speculate on short-term
swings in the securities market through frequent transactions in and out of the
funds in the Delaware Group. Telephone exchanges may be subject to limitations
as to amounts or frequency. The Transfer Agent and the Fund reserve the right
to record exchange instructions received by telephone and to reject exchange
requests at any time in the future.
As described in the Fund's Prospectuses, neither the Fund nor the
Transfer Agent is responsible for any shareholder loss incurred in
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<PAGE> 92
(SAI-DTF/PART B)
acting upon written or telephone instructions for redemption or exchange of
Fund shares which are reasonably believed to be genuine.
RIGHT TO REFUSE TIMING ACCOUNTS
With regard to accounts that are administered by market timing services
("Timing Firms") to purchase or redeem shares based on changing economic and
market conditions ("Timing Accounts"), the Fund will refuse any new Timing
Arrangements, as well as any new purchases (as opposed to exchanges) in
Delaware Group funds from Timing Firms. The Fund reserves the right to
temporarily or permanently terminate the exchange privilege or reject any
specific purchase order for any person whose transactions seem to follow a
timing pattern who: (i) makes an exchange request out of the Fund within two
weeks of an earlier exchange request out of the Fund, or (ii) makes more than
two exchanges out of the Fund per calendar quarter, or (iii) exchanges shares
equal in value to a least $5 million, or more than 1/4 of 1% of the Fund's net
assets. Accounts under common ownership or control, including accounts
administered so as to redeem or purchase shares based upon certain
predetermined market indicators, will be aggregated for purposes of the
exchange limits.
RESTRICTIONS ON TIMED EXCHANGES
Timing Accounts operating under existing Timing Agreements may only
execute exchanges between the following eight Delaware Group funds: (1)
Decatur Income Fund, (2) Decatur Total Return Fund, (3) Delaware Fund, (4)
Limited-Term Government Fund, (5) Tax-Free USA Fund, (6) Delaware Cash Reserve,
(7) Delchester Fund and (8) Tax-Free Pennsylvania Fund. No other Delaware
Group funds will be available for Timed Exchanges. Assets redeemed or
exchanged out of Timing Accounts in Delaware Group funds not listed above may
not be reinvested back into that Timing Account. The Fund reserves the right
to apply these same restrictions to the account(s) of any person whose
transactions seem to follow a time pattern (as described above).
The Fund also reserves the right to refuse the purchase side of an
exchange request by any Timing Account, person, or group if, in the Manager's
judgment, the Fund would be unable to invest effectively in accordance with its
investment objectives and policies, or would otherwise potentially be adversely
affected. A shareholder's purchase exchanges may be restricted or refused if
the Fund receives or anticipates simultaneous orders affecting significant
portions of the Fund's assets. In particular, a pattern of exchanges that
coincide with a "market timing" strategy may be disruptive to the Fund and
therefore may be refused.
Except as noted above, only shareholders and their authorized brokers
of record will be permitted to make exchanges or redemptions.
Following is a summary of the investment objectives of the other
Delaware Group funds:
DELAWARE FUND seeks long-term growth by a balance of capital
appreciation, income and preservation of capital. It uses a dividend-oriented
valuation strategy to select securities issued by established companies that
are believed to demonstrate potential for income and capital growth. DEVON
FUND seeks current income and capital appreciation by investing primarily in
income-producing common stocks, with a focus on common stocks the Manager
believes have the potential for above average dividend increases over time.
VALUE FUND seeks capital appreciation by investing primarily in common
stocks whose market values appear low relative to their underlying value or
future potential.
DELCAP FUND seeks long-term capital growth by investing in common
stocks and securities convertible into common stocks of companies that have a
demonstrated history of growth and have the potential to support continued
growth.
DECATUR INCOME FUND seeks the highest possible current income by
investing primarily in common stocks that provide the potential for income and
capital appreciation without undue risk to principal. DECATUR TOTAL RETURN
FUND seeks long-term growth by investing primarily in securities that provide
the potential for income and capital appreciation without undue risk to
principal.
DELCHESTER FUND seeks as high a current income as possible by investing
principally in corporate bonds, and also in U.S. Government securities and
commercial paper.
U.S. GOVERNMENT FUND seeks high current income by investing primarily
in long-term debt obligations issued or guaranteed by the U.S. Government, its
agencies or instrumentalities.
LIMITED-TERM GOVERNMENT FUND seeks high, stable income by investing
primarily in a portfolio of short- and intermediate-term securities issued or
guaranteed by the U.S. Government, its agencies or
-46-
<PAGE> 93
(SAI-DTF/PART B)
instrumentalities and instruments secured by such securities. U.S. GOVERNMENT
MONEY FUND seeks maximum current income with preservation of principal and
maintenance of liquidity by investing only in short-term securities issued or
guaranteed as to principal and interest by the U.S. Government, its agencies or
instrumentalities, and repurchase agreements collateralized by such securities,
while maintaining a stable net asset value.
DELAWARE CASH RESERVE seeks the highest level of income consistent with
the preservation of capital and liquidity through investments in short-term
money market instruments, while maintaining a stable net asset value.
TAX-FREE USA FUND seeks high current income exempt from federal income
tax by investing in municipal bonds of geographically-diverse issuers.
TAX-FREE INSURED FUND invests in these same types of securities but with an
emphasis on municipal bonds protected by insurance guaranteeing principal and
interest are paid when due. TAX-FREE USA INTERMEDIATE FUND seeks a high level
of current interest income exempt from federal income tax, consistent with the
preservation of capital by investing primarily in municipal bonds.
TAX-FREE MONEY FUND seeks high current income, exempt from federal
income tax, by investing in short-term municipal obligations, while maintaining
a stable net asset value.
TAX-FREE PENNSYLVANIA FUND seeks a high level of current interest
income exempt from federal and, to the extent possible, certain Pennsylvania
state and local taxes, consistent with the preservation of capital.
INTERNATIONAL EQUITY FUND seeks to achieve long-term growth without
undue risk to principal by investing primarily in international securities that
provide the potential for capital appreciation and income. GLOBAL BOND FUND
seeks to achieve current income consistent with the preservation of principal
by investing primarily in global fixed income securities that may also provide
the potential for capital appreciation. GLOBAL ASSETS FUND seeks to achieve
long-term total return by investing in global securities which will provide
higher current income than a portfolio comprised exclusively of equity
securities, along with the potential for capital growth.
DELAWARE GROUP PREMIUM FUND offers nine series available exclusively as
funding vehicles for certain insurance company separate accounts.
EQUITY/INCOME SERIES seeks the highest possible total rate of return by
selecting issues that exhibit the potential for capital appreciation while
providing higher than average dividend income. HIGH YIELD SERIES seeks as high
a current income as possible by investing in rated and unrated corporate bonds,
U.S. Government securities and commercial paper. CAPITAL RESERVES SERIES seeks
a high stable level of current income while minimizing fluctuations in
principal by investing in a diversified portfolio of short- and
intermediate-term securities. MONEY MARKET SERIES seeks the highest level of
income consistent with preservation of capital and liquidity through
investments in short-term money market instruments. GROWTH SERIES seeks
long-term capital appreciation by investing its assets in a diversified
portfolio of securities exhibiting the potential for significant growth.
MULTIPLE STRATEGY SERIES seeks a balance of capital appreciation, income and
preservation of capital. It uses a dividend-oriented valuation strategy to
select securities issued by established companies that are believed to
demonstrate potential for income and capital growth. INTERNATIONAL EQUITY
SERIES seeks long-term growth without undue risk to principal by investing
primarily in equity securities of foreign issuers that provide the potential
for capital appreciation and income. VALUE SERIES seeks capital appreciation
by investing in small- to mid-cap common stocks whose market value appears low
relative to their underlying value or future earnings and growth potential.
Emphasis will also be placed on securities of companies that may be temporarily
out of favor or whose value is not yet recognized by the market. EMERGING
GROWTH SERIES seeks long-term capital appreciation by investing primarily in
small-cap common stocks and convertible securities of emerging and other
growth-oriented companies. These securities will have been judged to be
responsive to changes in the marketplace and to have fundamental
characteristics to support growth. Income is not an objective.
For more complete information about any of these funds, including
charges and expenses, you can obtain a prospectus from the Distributor. Read
it carefully before you invest or forward funds.
Each of the summaries above is qualified in its entirety by the
information contained in each fund's prospectus(es).
-47-
<PAGE> 94
(SAI-DTF/PART B)
GENERAL INFORMATION
The Manager is the investment manager of the Fund. The Manager or its
affiliate, Delaware International Advisers Ltd., also manages the other funds
in the Delaware Group. The Manager, through a separate division, also manages
private investment accounts. While investment decisions of the Fund are made
independently from those of the other funds and accounts, they may make
investment decisions at the same time.
Access persons and advisory persons of the Delaware Group of funds, as
those terms are defined in SEC Rule 17j-1 under the 1940 Act, who provide
services to the Manager, Delaware International Advisers Ltd. or their
affiliates, are permitted to engage in personal securities transactions subject
to the exceptions set forth in Rule 17j-1 and the following general
restrictions and procedures: (1) certain blackout periods apply to personal
securities transactions of those persons; (2) transactions must receive advance
clearance and must be completed on the same day as the clearance is received;
(3) certain persons are prohibited from investing in initial public offerings
of securities and other restrictions apply to investments in private placements
of securities; (4) opening positions may only be closed-out at a profit after a
60-day holding period has elapsed; and (5) the Compliance Officer must be
informed periodically of all securities transactions and duplicate copies of
brokerage confirmations and account statements must be supplied to the
Compliance Officer.
The Distributor acts as national distributor for the Fund and for the
other mutual funds in the Delaware Group. As previously described, prior to
January 3, 1995, DDI served as the national distributor for the Fund. The
Distributor and, in its capacity as such, DDI received net commissions from the
Fund, after reallowances to dealers, as follows:
<TABLE>
<CAPTION>
TOTAL
AMOUNT NET
OF UNDER- AMOUNTS COMMISSION
FISCAL WRITING REALLOWED TO
YEAR ENDING COMMISSION TO DEALERS DISTRIBUTOR
- ----------- ---------- ---------- -----------
<S> <C> <C> <C>
June 30, 1995 $1,202,397 $1,042,162 $160,235
June 30, 1994 3,019,096 2,618,113 400,983
June 30, 1993 2,621,552 2,403,272 218,280
</TABLE>
For the fiscal year ended June 30, 1995, the Distributor and, in its
capacity as the Fund's national distributor, DDI received Limited CDSC payments
in the amount of $11,335 with respect to the Class A Shares. There were no
such payments for the fiscal years ended June 30, 1993 and 1994.
For the period September 6, 1994 (date of initial public offering)
through June 30, 1995, the Distributor and, in its capacity as the Fund's
national distributor, DDI received CDSC payments in the amount of $3,720 with
respect to the Class B Shares.
Effective as of January 3, 1995, all such payments described above have
been paid to the Distributor.
The Transfer Agent, an affiliate of the Manager, acts as shareholder
servicing, dividend disbursing and transfer agent for the Fund and for the
other mutual funds in the Delaware Group. The Transfer Agent is paid a fee by
the Fund for providing these services consisting of an annual per account
charge of $5.50 plus transaction charges for particular services according to a
schedule. Compensation is fixed each year and approved by the Board of
Directors, including a majority of the disinterested directors.
The Manager and its affiliates own the name "Delaware Group." Under
certain circumstances, including the termination of the Fund's advisory
relationship with the Manager or its distribution relationship with the
Distributor, the Manager and its affiliates could cause the Fund to delete the
words "Delaware Group" from the Fund's name.
-48-
<PAGE> 95
(SAI-DTF/PART B)
Chemical Bank, 450 West 33rd Street, New York, NY 10001, is custodian
of the Fund's securities and cash. As custodian for the Fund, Chemical Bank
maintains a separate account or accounts for the Fund; receives, holds and
releases portfolio securities on account of the Fund; receives and disburses
money on behalf of the Fund; and collects and receives income and other
payments and distributions on account of the Fund's portfolio securities.
The legality of the issuance of the shares offered hereby, registered
pursuant to Rule 24f-2 under the Investment Company Act of 1940, has been
passed upon for the Fund by Stradley, Ronon, Stevens & Young, Philadelphia,
Pennsylvania.
CAPITALIZATION
The Fund has a present authorized capitalization of one hundred million
shares of capital stock with a $.50 par value per share. The Fund offers four
classes of shares, each representing a proportionate interest in the assets of
the Fund, and each having the same voting and other rights and preferences as
the other classes of the Fund, except that shares of the Institutional Class
may not vote on any matter affecting the Fund Classes' Distribution Plans under
Rule 12b-1. Similarly, as a general matter, shareholders of Class A Shares,
Class B Shares and Class C Shares may vote only on matters affecting the 12b-1
Plan that relates to the class of shares that they hold. However, Class B
Shares may vote on a proposal to increase materially the fees to be paid by the
Fund under the Rule 12b-1 Plan relating to Class A Shares. General expenses of
the Fund will be allocated on a pro-rata basis to the classes according to
asset size, except that expenses of the Plans of Class A, Class B and Class C
Shares will be allocated solely to those classes. The Board of Directors has
allocated fifty million shares to the Trend Fund A Class, twenty-five million
shares to the Trend Fund B Class, twenty-five million shares to the Class C
Shares and twenty-five million shares to the Trend Fund Institutional Class.
Shares have no preemptive rights, are fully transferable and, when
issued, are fully paid and nonassessable.
Prior to September 6, 1994, the Trend Fund A Class was known as the
Trend Fund class and the Trend Fund Institutional Class was known as the Trend
Fund (Institutional) class.
NONCUMULATIVE VOTING
THESE SHARES HAVE NONCUMULATIVE VOTING RIGHTS WHICH MEANS THAT THE
HOLDERS OF MORE THAN 50% OF THE SHARES OF THE FUND VOTING FOR THE ELECTION OF
DIRECTORS CAN ELECT ALL THE DIRECTORS IF THEY CHOOSE TO DO SO, AND, IN SUCH
EVENT, THE HOLDERS OF THE REMAINING SHARES WILL NOT BE ABLE TO ELECT ANY
DIRECTORS.
This Part B does not include all of the information contained in the
Registration Statement which is on file with the Securities and Exchange
Commission.
-49-
<PAGE> 96
(SAI-DTF/PART B)
APPENDIX A--IRA INFORMATION
The Tax Reform Act of 1986 restructured, and in some cases eliminated, the tax
deductibility of IRA contributions. Under the Act, the full deduction for IRAs
($2,000 for each working spouse and $2,250 for one-income couples) was retained
for all taxpayers who are not covered by an employer-sponsored retirement plan.
Even if a taxpayer (or his or her spouse) is covered by an employer-sponsored
retirement plan, the full deduction is still available if the taxpayer's
adjusted gross income is below $25,000 ($40,000 for taxpayers filing joint
returns). A partial deduction is allowed for married couples with incomes
between $40,000 and $50,000, and for single individuals with incomes between
$25,000 and $35,000. The Act does not permit deductions for contributions to
IRAs by taxpayers whose adjusted gross income before IRA deductions exceeds
$50,000 ($35,000 for singles) and who are active participants in an
employer-sponsored retirement plan. Taxpayers who were not allowed deductions
on IRA contributions still can make nondeductible IRA contributions of as much
as $2,000 for each working spouse ($2,250 for one-income couples), and defer
taxes on interest or other earnings from the IRAs. Special rules apply for
determining the deductibility of contributions made by married individuals
filing separate returns.
As illustrated in the following tables, maintaining an Individual Retirement
Account remains a valuable opportunity.
For many, an IRA will continue to offer both an up-front tax break with its tax
deduction each year and the real benefit that comes with tax-deferred
compounding. For others, losing the tax deduction will impact their taxable
income status each year. Over the long term, however, being able to defer
taxes on earnings still provides an impressive investment opportunity--a way to
have money grow faster due to tax-deferred compounding.
-50-
<PAGE> 97
(SAI-DTF/PART B)
Even if your IRA contribution is no longer deductible, the benefits of saving
on a tax-deferred basis can be substantial. The following tables illustrate
the benefits of tax-deferred versus taxable compounding. Each reflects a
constant 10% rate of return, compounded annually, with the reinvestment of all
proceeds. The tables do not take into account any sales charges or fees. Of
course, earnings accumulated in your IRA will be subject to tax upon
withdrawal. If you choose a mutual fund with a fluctuating net asset value,
like the Fund, your bottom line at retirement could be lower--it could also be
much higher.
$2,000 INVESTED ANNUALLY ASSUMING A 10% ANNUALIZED RETURN
15% Tax Bracket Single - $0-$22,750
Joint - $0-$38,000
<TABLE>
<CAPTION>
HOW MUCH YOU
END OF CUMULATIVE HOW MUCH YOU HAVE WITH FULL
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA IRA DEDUCTION
<S> <C> <C> <C>
1 $ 2,000 $ 1,844 $ 2,200
5 10,000 10,929 13,431
10 20,000 27,363 35,062
15 30,000 52,074 69,899
20 40,000 89,231 126,005
25 50,000 145,103 216,364
30 60,000 229,114 361,887
35 70,000 355,438 596,254
40 80,000 545,386 973,704
</TABLE>
[Without IRA--investment of $1,700 ($2,000 less 15%) earning 8.5% (10% less
15%)]
28% Tax Bracket Single - $22,751-$55,100
Joint - $38,001-$91,850
<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,544 $ 1,584 $ 2,200
5 10,000 8,913 9,670 13,431
10 20,000 21,531 25,245 35,062
15 30,000 39,394 50,328 69,899
20 40,000 64,683 90,724 126,005
25 50,000 100,485 155,782 216,364
30 60,000 151,171 260,559 361,887
35 70,000 222,927 429,303 596,254
40 80,000 324,512 701,067 973,704
</TABLE>
[Without IRA--investment of $1,440 ($2,000 less 28%) earning 7.2% (10% less
28%)]
[With IRA--No Deduction--investment of $1,440 ($2,000 less 28%) earning 10%]
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<PAGE> 98
(SAI-DTF/PART B)
31% Tax Bracket Single - $55,101-$115,000
Joint - $91,851-$140,000
<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,475 $ 1,518 $ 2,200
5 10,000 8,467 9,268 13,431
10 20,000 20,286 24,193 35,062
15 30,000 36,787 48,231 69,899
20 40,000 59,821 86,943 126,005
25 50,000 91,978 149,291 216,364
30 60,000 136,868 249,702 361,887
35 70,000 199,536 411,415 596,254
40 80,000 287,021 671,855 973,704
</TABLE>
[Without IRA--investment of $1,380 ($2,000 less 31%) earning 6.9% (10% less
31%)]
[With IRA--No Deduction--investment of $1,380 ($2,000 less 31%) earning 10%]
36% Tax Bracket* Single - $115,001-$250,000
Joint - $140,001-$250,000
<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,362 $ 1,408 $ 2,200
5 10,000 7,739 8,596 13,431
10 20,000 18,292 22,440 35,062
15 30,000 32,683 44,736 69,899
20 40,000 52,308 80,643 126,005
25 50,000 79,069 138,473 216,364
30 60,000 115,562 231,608 361,887
35 70,000 165,327 381,602 596,254
40 80,000 233,190 623,170 973,704
</TABLE>
[Without IRA--investment of $1,280 ($2,000 less 36%) earning 6.4% (10% less
36%)]
[With IRA--No Deduction--investment of $1,280 ($2,000 less 36%) earning 10%]
-52-
<PAGE> 99
(SAI-DTF/PART B)
39.6% Tax Bracket* Single - over $250,000
Joint - over $250,000
<TABLE>
<CAPTION>
END OF CUMULATIVE HOW MUCH YOU HOW MUCH YOU HAVE WITH FULL IRA
YEAR INVESTMENT AMOUNT HAVE WITHOUT IRA NO DEDUCTION DEDUCTION
<S> <C> <C> <C> <C>
1 $ 2,000 $ 1,281 $ 1,329 $ 2,200
5 10,000 7,227 8,112 13,431
10 20,000 16,916 21,178 35,062
15 30,000 29,907 42,219 69,899
20 40,000 47,324 76,107 126,005
25 50,000 70,677 130,684 216,364
30 60,000 101,986 218,580 361,887
35 70,000 143,965 360,137 596,254
40 80,000 200,249 588,117 973,704
</TABLE>
[Without IRA--investment of $1,208 ($2,000 less 39.6%) earning 6.04% (10% less
39.6%)]
[With IRA--No Deduction--investment of $1,208 ($2,000 less 39.6%) earning 10%]
* For tax years beginning after 1992, a 36% tax rate applies to all taxable
income in excess of the maximum dollar amounts subject to the 31% tax rate.
In addition, a 10% surtax (not applicable to capital gains) applies to
certain high-income taxpayers. It is computed by applying a 39.6% rate to
taxable income in excess of $250,000. The above tables do not reflect the
personal exemption phaseout nor the limitations of itemized deductions that
may apply.
-53-
<PAGE> 100
(SAI-DTF/PART B)
$2,000 SINGLE INVESTMENT AT A RETURN OF 10% COMPOUNDED ANNUALLY
<TABLE>
<CAPTION>
TAXABLE - TAXABLE - TAXABLE - TAXABLE - TAXABLE - TAX
YEARS 39.6%* 36%* 31% 28% 15% DEFERRED
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10 $ 3,595 $ 3,719 $ 3,898 $ 4,008 $ 4,522 $ 5,187
15 4,820 5,072 5,441 5,675 6,799 8,354
20 6,463 6,916 7,596 8,034 10,224 13,455
30 11,618 12,861 14,803 16,102 23,117 34,899
40 20,884 23,916 28,849 32,272 52,266 90,519
</TABLE>
$2,000 INVESTED ANNUALLY AT A RETURN OF 10% COMPOUNDED ANNUALLY
<TABLE>
<CAPTION>
TAXABLE - TAXABLE - TAXABLE - TAXABLE - TAXABLE - TAX
YEARS 39.6%* 36%* 31% 28% 15% DEFERRED
- ------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
10 $ 28,006 $ 28,581 $ 29,400 $ 29,904 $ 32,192 $ 35,062
15 49,514 51,067 53,314 54,714 61,264 69,899
20 78,351 81,731 86,697 89,838 104,978 126,005
30 168,852 180,566 198,360 209,960 269,546 361,887
40 331,537 364,360 415,973 450,711 641,631 973,704
</TABLE>
* For tax years beginning after 1992, a 36% tax rate applies to all taxable
income in excess of the maximum dollar amounts subject to the 31% tax
rate. In addition, a 10% surtax (not applicable to capital gains) applies
to certain high-income taxpayers. It is computed by applying a 39.6% rate
to taxable income in excess of $250,000. The above tables do not reflect
the personal exemption phaseout nor the limitations of itemized deductions
that may apply.
-54-
<PAGE> 101
(SAI-DTF/PART B)
THE VALUE OF STARTING YOUR IRA EARLY
The following illustrates how much more you would have contributing
$2,000 each January--the earliest opportunity--compared to contributing on
April 15th of the following year--the latest, for each tax year.
<TABLE>
<S> <C> <C>
After 5 years $3,528 more
10 years $6,113
20 years $17,228
30 years $47,295
</TABLE>
Compounded returns for the longest period of time is the key. The above
illustration assumes a 10% rate of return and the reinvestment of all proceeds.
And it pays to shop around. If you get just 2% more per year, it can
make a big difference when you retire. A constant 8% versus 10% return, both
compounded annually, illustrates the point. This chart is based on a yearly
investment of $2,000 on January 1. After 30 years the difference can mean as
much as 50% more!
<TABLE>
<CAPTION>
8% Return 10% Return
--------- ----------
<S> <C> <C>
10 Years $31,291 $35,062
30 Years $244,692 $361,887
</TABLE>
The statistical exhibits above are for illustration purposes only and do
not reflect the actual performance for the Fund either in the past or in the
future.
-55-
<PAGE> 102
SAI-DTF/A-CHT
APPENDIX B
TREND FUND PERFORMANCE OVERVIEW
The following table illustrates the total return on one share invested
in the Trend Fund A Class during the 10-year period ended June 30, 1995.1 The
results reflect the reinvestment of all dividends and realized securities
profits distributions at the net asset value reported at the time of
distribution. No adjustment has been made for any income taxes payable by
shareholders on income dividends or realized securities profits distributions
accepted in shares.
TREND FUND A CLASS
<TABLE>
<CAPTION>
CUMULA-
TIVE NET
ASSET
MAXIMUM NET ASSET VALUE AT
OFFERING VALUE DISTRIBUTIONS YEAR-END
PRICE ------------ ------------------- WITH ALL
YEAR AT BEGIN- FROM FROM DISTRIBU
ENDED BEGIN- NING END INVEST- REALIZED TIONS
JUNE NING OF OF OF MENT SECURI- REIN-
30 YEAR(2) YEAR YEAR INCOME TIES PROFITS VESTED
- ------ -------- ----- ------ ------ ----------- -------
<S> <C> <C> <C> <C>
1986 $6.75 $6.43 $8.91 $0.128 ---- $9.09
1987 9.35 8.91 9 .12 --- ---- 9.30
1988 9.57 9.12 8 .13 --- ---- 8.29
1989 8.54 8.13 10.87 --- $0.320 11.55
1990 11.41 10.87 9 .97 0.050 2.220 13.21
1991 10.47 9.97 8 .92 0.050 0.520 12.57
1992 9.36 8.92 11.38 --- 0.160 16.25
1993 11.95 11.38 13.98 --- 1.150 21.98
1994 14.68 13.98 12.21 --- 1.940 22.11
1995 12.82 12.21 14.21 --- 0.790 27.50
------ ------
TOTAL DISTRIBUTIONS $0.228 $7.100
<CAPTION>
PERCENTAGE CHANGES DURING YEAR
---------------------------------------------------------------------------------------------------------------------
TREND FUND
----------------------------------------------
YEAR MAXIMUM OFFERING PRICE NET ASSET VALUE STANDARD & DOW JONES CONSUMER
ENDED TO NET ASSET VALUE TO NET ASSET VALUE POOR'S 500(5) INDUSTRIAL(5) PRICE INDEX(5)
JUNE ---------------------------------------------------------------------------------------------------------------------
30 ANNUAL CUMULATIVE(3) ANNUAL CUMULATIVE(4) ANNUAL CUMULATIVE ANNUAL CUMULATIVE ANNUAL CUMULATIVE
- ------ ------ ---------- ------ ----------- ------ ---------- ------ ---------- ------ ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1986 34.7% 34.7% 41.4% 41.4% 35.9% 35.9% 47.8% 47.8% 1.7% 1.7%
1987 -2.5 37.9 2.4 44.7 25.2 70.0 32.2 95.4 3.7 5.5
1988 -15.1 22.9 -10.9 29.0 -6.9 58.3 -8.3 79.2 3.9 9.7
1989 32.7 71.2 39.3 79.6 20.5 90.7 18.7 112.7 5.2 15.4
1990 8.9 95.7 14.3 105.4 16.5 122.1 22.7 161.0 4.7 20.7
1991 -9.3 86.3 -4.8 95.5 7.4 138.4 4.6 173.1 4.7 26.4
1992 23.2 140.8 29.3 152.8 13.4 170.4 17.7 221.4 3.1 30.3
1993 28.8 225.6 35.2 241.8 13.6 207.2 9.2 251.0 3.0 34.2
1994 -4.2 227.6 0.6 243.9 1.4 211.5 5.9 271.9 2.5 37.6
1995 18.5 307.5 24.4 327.8 26.1 292.7 29.2 380.5 3.0 41.7
</TABLE>
- ----------
(1) All figures prior to May 9, 1986 are adjusted for a 2-for-1 stock split paid
on that date. The Trend Fund A Class began paying 12b-1 payments on June 1,
1992 and performance prior to that date does not reflect such payments.
(2) Reflects a maximum sales charge of 5.75% of total investment. There are
reduced sales charges for investments of $100,000 or more.
(3) Reflects an offering price of $6.82 on June 30, 1985.
(4) Reflects a net asset value of $6.43 on June 30, 1985.
(5) Source: Lipper Analytical.
This period was one of generally rising common stock prices but also covers
several years of declining prices. The results illustrated should not be
considered as representative of dividend income or capital gain or loss
which may be realized from an investment in the Fund today.
The Standard & Poor's 500 Stock Index and the Dow Jones Industrial Average
are industry-accepted unmanaged indices of generally-conservative securities
used for measuring general market performance. The performance illustrated
for these indices reflects the reinvestment of all distributions on a
quarterly basis and market price fluctuations. The indices do not take into
account any sales charge or other fees. In seeking a particular investment
objective, the Fund's portfolio primarily includes aggressive growth common
stocks, which differ from those in the indices.
The Consumer Price Index, as prepared by the U.S. Bureau of Labor Statistics,
is the most commonly used measure of inflation. It indicates the cost
fluctuations of a representative group of consumer goods. It does not
represent a return from an investment.
-56-
<PAGE> 103
SAI-DTF/B-CHT
APPENDIX B
TREND FUND PERFORMANCE OVERVIEW
The following table illustrates the total return on one share invested in
the Trend Fund B Class during the period September 6, 1994 (date of initial
public offering) through June 30, 1995. The results reflect the reinvestment
of all dividends and realized securities profits distributions at the net
asset value reported at the time of distribution. No adjustment has been
made for any income taxes payable by shareholders on income dividends or
realized securities profits distributions accepted in shares.
TREND FUND B CLASS
<TABLE>
<CAPTION>
CUMULA-
TIVE NET
ASSET
MAXIMUM NET ASSET VALUE AT
OFFERING VALUE DISTRIBUTIONS YEAR-END
PRICE ------------ ------------------- WITH ALL
PERIOD AT BEGIN- FROM FROM DISTRIBU
ENDED BEGIN- NING END INVEST- REALIZED TIONS
JUNE NING OF OF OF MENT SECURI- REIN-
30 YEAR YEAR YEAR INCOME TIES PROFITS VESTED
- ------ ------- ----- ----- ------ ----------- -------
<S> <C> <C> <C> <C>
1995 $12.11 $12.11 $14 .13 --- --- $14.13
----- --
TOTAL DISTRIBUTIONS $0.000 $0.000
<CAPTION>
PERCENTAGE CHANGES DURING YEAR
---------------------------------------------------------------------------------------------------------------------
TREND FUND
----------------------------------------------
PERIOD RETURNS INCLUDING RETURNS EXCLUDING STANDARD & DOW JONES CONSUMER
ENDED CDSC(1) CDSC(1) POOR'S 500(3) INDUSTRIAL(3) PRICE INDEX(3)
JUNE ---------------------------------------------------------------------------------------------------------------------
30 ANNUAL CUMULATIVE(2) ANNUAL CUMULATIVE(2) ANNUAL CUMULATIVE ANNUAL CUMULATIVE ANNUAL CUMULATIVE
- ------ ------ ---------- ------ ----------- ------ ---------- ------ ---------- ------ ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C> <C>
1995 12.7% 12.7% 16.7% 16.7% 18.3% 18.3% 19.9% 19.9% 2.4% 2.4%
</TABLE>
- ---------------
(1) Total return provided below is on an aggregate basis. Total return for this
short of a time period may not be representative of longer-term results.
(2) Reflects a net asset value of $12.11 on September 2, 1994.
(3) Source: Lipper Analytical.
The Standard & Poor's 500 Stock Index and the Dow Jones Industrial Average
are industry-accepted unmanaged indices of generally-conservative securities
used for measuring general market performance. The performance illustrated
for these indices reflects the reinvestment of all distributions on a
quarterly basis and market price fluctuations. The indices do not take into
account any sales charge or other fees. In seeking a particular investment
objective, the Fund's portfolio primarily includes aggressive growth common
stocks, which differ from those in the indices.
The Consumer Price Index, as prepared by the U.S. Bureau of Labor
Statistics, is the most commonly used measure of inflation. It indicates the
cost fluctuations of a representative group of consumer goods. It does not
represent a return from an investment.
-57-
<PAGE> 104
SAI-DTF/IC-CHT
APPENDIX B
TREND FUND PERFORMANCE OVERVIEW
The following table illustrates the total return on one share invested in
the Trend Fund Institutional Class1 during the 10-year period ended June 30,
1995. The results reflect the reinvestment of all dividends and realized
securities profits distributions at the net asset value reported at the time
of distribution. No adjustment has been made for any income taxes payable by
shareholders on income dividends or realized securities profits distributions
accepted in shares.
<TABLE>
<CAPTION>
TREND FUND INSTITUTIONAL CLASS
CUMULA-
TIVE NET
ASSET
MAXIMUM NET ASSET VALUE AT
OFFERING VALUE DISTRIBUTIONS YEAR-END
PRICE ------------ ------------------- WITH ALL
YEAR AT BEGIN- FROM FROM DISTRIBU
ENDED BEGIN- NING END INVEST- REALIZED TIONS
JUNE NING OF OF OF MENT SECURI- REIN-
30 YEAR YEAR YEAR INCOME TIES PROFITS VESTED
- ------ ------- ------ ----- ------ ------------ --------
<S> <C> <C> <C> <C>
1986 $6.43 $6.43 $8.91 $0.128 --- $9.09
1987 8.91 8.91 9.12 --- --- 9.30
1988 9.12 9.12 8.13 --- --- 8.29
1989 8.13 8.13 10.87 --- $0.320 11.55
1990 10.87 10.87 9.97 0.050 2.220 13.21
1991 9.97 9.97 8.92 0.050 0.520 12.57
1992 8.92 8.92 11.38 --- 0.160 16.25
1993 11.38 11.38 13.99 --- 1.150 21.98
1994 13.99 13.99 12.25 --- 1.940 22.11
1995 12.25 12.25 14.30 --- 0.790 27.50
----- -------
TOTAL DISTRIBUTIONS $0.228 $7.100
<CAPTION>
PERCENTAGE CHANGES DURING YEAR
-----------------------------------------------------------------------------------------------
TREND FUND
----------------------
YEAR NET ASSET VALUE STANDARD & DOW JONES CONSUMER
ENDED TO NET ASSET VALUE POOR'S 500(3) INDUSTRIAL(3) PRICE INDEX(3)
JUNE ----------------------------------------------------------------------------------------------
30 ANNUAL CUMULATIVE(2) ANNUAL CUMULATIVE ANNUAL CUMULATIVE ANNUAL CUMULATIVE
- ------ ------ ---------- ------ ----------- ------ ---------- ------ ----------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
1986 41.4% 41.4% 35.9% 35.9% 47.8% 47.8% 1.7% 1.7%
1987 2.4 44.7 25.2 70.0 32.2 95.4 3.7 5.5
1988 -10.9 29.0 -6.9 58.3 -8.3 79.2 3.9 9.7
1989 39.3 79.6 20.5 90.7 18.7 112.7 5.2 15.4
1990 14.3 105.4 16.5 122.1 22.7 161.0 4.7 20.7
1991 -4.8 95.5 7.4 138.4 4.6 173.1 4.7 26.4
1992 29.3 152.8 13.4 170.4 17.7 221.4 3.1 30.3
1993 35.3 242.1 13.6 207.2 9.2 251.0 3.0 34.2
1994 0.8 244.9 1.4 211.5 5.9 271.9 2.5 37.6
1995 24.7 330.3 26.1 292.7 29.2 380.5 3.0 41.7
</TABLE>
- -----------
(1) Performance for Trend Fund Institutional Class for periods prior to November
23, 1992 (date of initial public offering) is calculated by taking the
performance of the Trend Fund A Class and adjusting it to reflect the
elimination of all sales charges.
(2) Reflects a net asset value of $6.43 on June 30, 1985.
(3) Source: Lipper Analytical.
This period was one of generally rising common stock prices but also covers
several years of declining prices. The results illustrated should not be
considered as representative of dividend income or capital gain or loss
which may be realized from an investment in the Fund today.
The Standard & Poor's 500 Stock Index and the Dow Jones Industrial Average
are industry-accepted unmanaged indices of generally-conservative securities
used for measuring general market performance. The performance illustrated
for these indices reflects the reinvestment of all distributions on a
quarterly basis and market price fluctuations. The indices do not take into
account any sales charge or other fees. In seeking a particular investment
objective, the Fund's portfolio primarily includes aggressive growth common
stocks, which differ from those in the indices.
The Consumer Price Index, as prepared by the U.S. Bureau of Labor
Statistics, is the most commonly used measure of inflation. It indicates
the cost fluctuations of a representative group of consumer goods. It
does not represent a return from an investment.
-58-
<PAGE> 105
(SAI-DTF/PART B)
APPENDIX C
THE COMPANY LIFE CYCLE
Traditional business theory contends that a typical company progresses
through basically four stages of development, keyed closely to a firm's sales.
1. EMERGING GROWTH--a period of experimentation in which the company
builds awareness of a new product or firm.
2. ACCELERATED DEVELOPMENT--a period of rapid growth with potentially
high profitability and acceptance of the product.
3. MATURING PHASE--a period of diminished real growth due to
dependence on replacement or sustained product demand.
4. CYCLICAL STAGE--a period in which a company faces a potential
saturation of demand for its product. At this point, a firm either diversifies
or becomes obsolete.
HYPOTHETICAL CORPORATE LIFE CYCLE
[chart appears here]
Hypothetical Corporate Life Cycle Chart shows in a line illustration the
stages that a typical company would go through, beginning with the emerging
state where sales growth continues at a steep pace to the mature phase where
growth levels off to the cyclical stage where sales show more definitive highs
and lows.
The above chart illustrates the path traditionally followed by companies
that successfully survive the growth sequence.
-56-
<PAGE> 106
(SAI-DTF/PART B)
FINANCIAL STATEMENTS
Ernst & Young LLP serves as the independent auditors for the Fund and,
in its capacity as such, audits the financial statements contained in the
Fund's Annual Report. The Fund's Statement of Net Assets, Statement of
Operations, Statement of Changes in Net Assets and Notes to Financial
Statements, as well as the report of Ernst & Young LLP, independent auditors,
for the fiscal year ended June 30, 1995 are included in the Fund's Annual
Report to shareholders. The financial statements, the notes relating thereto
and the report of Ernst & Young LLP listed above are incorporated by reference
from the Annual Report into this Part B.
-57-
<PAGE> 107
(SAI-DTF/PART B)
The Delaware Group includes funds with a wide range of investment
objectives. Stock funds, income funds, tax-free funds, money market funds,
global and international funds and closed-end equity funds give investors the
ability to create a portfolio that fits their personal financial goals. For
more information, shareholders of the Fund Classes should contact their
financial adviser or call Delaware Group at 800-523-4640, in Philadelphia call
215-988-1333 and shareholders of the Institutional Class should contact
Delaware Group at 800-828-5052.
INVESTMENT MANAGER
Delaware Management Company, Inc.
One Commerce Square
Philadelphia, PA 19103
NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
1818 Market Street
Philadelphia, PA 19103
SHAREHOLDER SERVICING,
DIVIDEND DISBURSING
AND TRANSFER AGENT
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103
LEGAL COUNSEL
Stradley, Ronon, Stevens & Young
One Commerce Square
Philadelphia, PA 19103
INDEPENDENT AUDITORS
Ernst & Young LLP
Two Commerce Square
Philadelphia, PA 19103
CUSTODIAN
Chemical Bank
450 West 33rd Street
New York, NY 10001
- -----------------------------------
TREND FUND
- -----------------------------------
A CLASS
- -----------------------------------
B CLASS
- -----------------------------------
C CLASS
- -----------------------------------
INSTITUTIONAL CLASS
- -----------------------------------
CLASSES OF DELAWARE GROUP
FREND FUND, INC.
- -----------------------------------
PART B
STATEMENT OF
ADDITIONAL INFORMATION
- -----------------------------------
November 29, 1995
DELAWARE
GROUP
--------
<PAGE> 108
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
PART C
Other Information
Item 24. Financial Statements and Exhibits
(a) Financial Statements:
Part A - Financial Highlights
*Part B - Statement of Net Assets
Statement of Operations
Statement of Changes in Net
Assets
Notes to Financial
Statements
Accountant's Report
* The financial statements and Accountant's Report
listed above are incorporated by reference from the
Registrant's Annual Report for the fiscal year
ended June 30, 1995 into Part B.
(b) Exhibits:
(1) Articles of Incorporation.
(a) Articles of Incorporation, as
amended and supplemented
through August 30, 1995,
incorporated into this filing
by reference to Post-Effective
Amendment No. 53 filed August
30, 1995.
(b) Form of Articles Supplementary
(November 1995) attached as
Exhibit.
(2) By-Laws. By-Laws, as amended through
August 30, 1995, incorporated into this
filing by reference to Post-Effective
Amendment No. 53 filed August 30, 1995.
(3) Voting Trust Agreement. Inapplicable.
i
<PAGE> 109
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
(4) Copies of All Instruments Defining the
Rights of Holders.
(a) Articles of Incorporation,
Articles of Amendment and
Articles Supplementary.
(i) Incorporated into
this filing by
reference to
Post-Effective
Amendment No. 53
filed August 30, 1995.
(ii) Form of Articles
Supplementary
(November 1995)
attached as
Exhibit 24(b)(1)(b).
(b) By-Laws. Incorporated into
this filing by reference to
Post-Effective Amendment No.
53 filed August 30, 1995.
(5) Investment Management Agreement.
Investment Management Agreement between
Delaware Management Company, Inc. and
the Registrant dated April 3, 1995
incorporated into this filing by
reference to Post-Effective Amendment
No. 53 filed August 30, 1995.
(6) (a) Distribution Agreement.
(i) Form of Distribution
Agreement (April 1995)
included as Module.
(ii) Form of Amendment
No. 1 to Distribution
Agreement
(November 1995)
included as Module.
(b) Administration and Service
Agreement. Form of
Administration and Service
Agreement (as amended November
1995) included as Module.
(c) Dealer's Agreement. Form of
Dealer's Agreement (as amended
November 1995) included as
Module.
(d) Form of Mutual Fund Agreement
for the Delaware Group of
Funds incorporated into this
filing by reference to
Post-Effective Amendment No.
53 filed August 30, 1995.
(7) Bonus, Profit Sharing, Pension
Contracts. Incorporated into this
filing by reference to Post-Effective
Amendment No. 53 filed August 30, 1995.
ii
<PAGE> 110
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
(8) Custodian Agreement. Incorporated into
this filing by reference to
Post-Effective Amendment No. 43 filed
August 25, 1989 and Post-Effective
Amendment No. 45 filed June 25, 1991.
(9) Other Material Contracts. Shareholders
Services Agreement incorporated into
this filing by reference to
Post-Effective Amendment No. 40 filed
June 30, 1988.
(10) Opinion of Counsel. Filed with letter
relating to Rule 24f-2 on August 31,
1995.
(11) Consent of Auditors. Attached as
Exhibit.
(12-13) Inapplicable.
(14) Model Plans. Incorporated into this
filing by reference to Post-Effective
Amendment No. 53 filed August 30, 1995.
**(15) Plans under Rule 12b-1.
(a) Form of Plan under Rule 12b-1
for Class A (November 1995)
included as Module.
(b) Form of Plan under Rule 12b-1
for Class B (November 1995)
included as Module.
(c) Form of Plan under Rule 12b-1
for Class C (November 1995)
included as Module.
(16) Schedules of Computation for each
Performance Quotation. Incorporated
into this filing by reference to
Post-Effective Amendment No. 53 filed
August 30, 1995.
(17) Financial Data Schedules. Incorporated
into this filing by reference to
Post-Effective Amendment No. 53 filed
August 30, 1995.
(18) Plan under Rule 18f-3. Form of Plan
under Rule 18f-3 included as Module.
(19) Other: Directors' Power of Attorney.
Incorporated into this filing
by reference to Post-
Effective Amendment No. 53
filed August 30, 1995.
**Relates only to Trend Fund A Class, Trend Fund B Class and Trend Fund C
Class.
iii
<PAGE> 111
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
Item 25. Persons Controlled by or under Common Control with
Registrant. None.
Item 26. Number of Holders of Securities.
<TABLE>
<CAPTION>
(1) (2)
Number of
Title of Class Record Holders***
-------------- --------------
<S> <C>
Delaware Group Trend Fund, Inc.'s:
Trend Fund A Class
Common Stock Par Value 31,669 Accounts as of
$.50 Per Share October 31, 1995
Trend Fund B Class
Common Stock Par Value 1,107 Accounts as of
$.50 Per Share October 31, 1995
Trend Fund C Class
Common Stock Par Value 0 Accounts as of
$.50 Per Share October 31, 1995
Trend Fund Institutional Class
Common Stock Par Value 38 Accounts as of
$.50 Per Share October 31, 1995
</TABLE>
*** Trend Fund C Class was not offered prior to the effective date of this
Registration Statement.
Item 27. Indemnification. Incorporated into this filing by
reference to Post-Effective Amendment No. 31 filed June
27, 1983 and Article VII of the By-Laws incorporated
into this filing by reference to Post-Effective
Amendment No. 53 filed August 30, 1995.
iv
<PAGE> 112
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
Item 28. Business and Other Connections of Investment Adviser.
Delaware Management Company, Inc. (the "Manager") or
its affiliate, Delaware International Advisers Ltd., also serves as investment
manager to the other funds in the Delaware Group (Delaware Group Delaware Fund,
Inc., Delaware Group Value Fund, Inc., Delaware Group DelCap Fund, Inc.,
Delaware Group Decatur Fund, Inc., Delaware Group Delchester High-Yield Bond
Fund, Inc., Delaware Group Government Fund, Inc., Delaware Group Limited-Term
Government Funds, Inc., Delaware Group Cash Reserve, Inc., Delaware Group
Tax-Free Fund, Inc., DMC Tax-Free Income Trust-Pennsylvania, Delaware Group
Tax-Free Money Fund, Inc., Delaware Group Premium Fund, Inc., Delaware Group
Global & International Funds, Inc., Delaware Pooled Trust, Inc., Delaware Group
Dividend and Income Fund, Inc. and Delaware Group Global Dividend and Income
Fund, Inc.) and provides investment advisory services to institutional
accounts, primarily retirement plans and endowment funds. In addition, certain
directors of the Manager also serve as directors/trustees of the other Delaware
Group funds, and certain officers are also officers of these other funds. A
company owned by the Manager's parent company acts as principal underwriter to
the mutual funds in the Delaware Group (see Item 29 below) and another such
company acts as the shareholder servicing, dividend disbursing and transfer
agent for all of the other mutual funds in the Delaware Group.
The following persons serving as directors or officers
of the Manager have held the following positions during the past two years:
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with the Manager and its
Business Address* Affiliates and Other Positions and Offices Held
- ----------------------- ---------------------------------------------------------------------------------
<S> <C>
Wayne A. Stork Chairman of the Board, Chief Executive Officer, Chief Investment Officer and Director of
Delaware Management Company, Inc.; President, Chief Executive Officer, Chairman of the
Board and Director of the Registrant, and with the exception of Delaware Pooled Trust,
Inc., each of the other funds in the Delaware Group and Delaware Management Holdings,
Inc.; Chairman of the Board and Director of Delaware Pooled Trust, Inc. and Delaware
Investment Counselors, Inc.; Chairman, Chief Executive Officer and Director of DMH
Corp., Delaware International Advisers Ltd., Delaware International Holdings Ltd. and
Founders Holdings, Inc.; and Director of Delaware Distributors, Inc. and Delaware
Service Company, Inc.
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
v
<PAGE> 113
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with the Manager and its
Business Address* Affiliates and Other Positions and Offices Held
- ----------------------- --------------------------------------------------------------------------------
<S> <C>
Winthrop S. Jessup Executive Vice President and Director of Delaware Management Company, Inc., DMH Corp.,
Delaware International Holdings Ltd. and Founders Holdings, Inc.; Executive Vice
President of the Registrant and, with the exception of Delaware Pooled Trust, Inc., each
of the other funds in the Delaware Group and Delaware Management Holdings, Inc.;
President and Chief Executive Officer of Delaware Pooled Trust, Inc.; Vice Chairman of
Delaware Distributors, L.P.; Vice Chairman and Director of Delaware Distributors, Inc.;
Director of Delaware Service Company, Inc., Delaware Management Trust Company and
Delaware International Advisers Ltd.; and President and Director of Delaware Investment
Counselors, Inc.
Richard G. Unruh, Jr. Executive Vice President and Director of Delaware Management Company, Inc.; Executive
Vice President of the Registrant and each of the other funds in the Delaware Group;
Senior Vice President of Delaware Management Holdings, Inc.; and Director of Delaware
International Advisers Ltd.
Board of Directors, Chairman of Finance Committee, Keystone Insurance Company since
1989, 2040 Market Street, Philadelphia, PA; Board of Directors, Chairman of Finance
Committee, Mid Atlantic, Inc., since 1989, 2040 Market Street, Philadelphia, PA
Paul E. Suckow Senior Vice President/Chief Investment Officer, Fixed Income of Delaware Management
Company, Inc., the Registrant, each of the other funds in the Delaware Group and
Delaware Management Holdings, Inc.; Senior Vice President and Director of Founders
Holdings, Inc.; and Director of Founders CBO Corporation
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
vi
<PAGE> 114
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with the Manager and its
Business Address* Affiliates and Other Positions and Offices Held
- ----------------------- ----------------------------------------------------------------------------------
<S> <C>
David K. Downes Senior Vice President, Chief Administrative Officer and Chief Financial Officer of
Delaware Management Company, Inc., the Registrant and each of the other funds in the
Delaware Group; Chairman and Director of Delaware Management Trust Company; Senior Vice
President, Chief Administrative Officer, Chief Financial Officer and Treasurer of
Delaware Management Holdings, Inc.; Senior Vice President, Chief Financial Officer,
Treasurer and Director of DMH Corp.; Senior Vice President, Chief Administrative Officer,
and Director of Delaware Distributors, Inc.; Senior Vice President and Chief
Administrative Officer of Delaware Distributors, L.P.; Senior Vice President, Chief
Administrative Officer, Chief Financial Officer and Director of Delaware Service Company,
Inc.; Chief Financial Officer and Director of Delaware International Holdings Ltd.;
Senior Vice President, Chief Financial Officer and Treasurer of Delaware Investment
Counselors, Inc.; Senior Vice President and Director of Founders Holdings, Inc.; and
Director of Delaware International Advisers Ltd.
George M. Chamberlain, Jr. Senior Vice President, Secretary and Director of Delaware Management Company, Inc., DMH
Corp., Delaware Distributors, Inc. and Delaware Service Company, Inc.; Senior Vice
President and Secretary of the Registrant, each of the other funds in the Delaware
Group, Delaware Distributors, L.P., Delaware Investment Counselors, Inc. and Delaware
Management Holdings, Inc.; Executive Vice President, Secretary and Director of Delaware
Management Trust Company; Corporate Vice President, Secretary and Director of Founders
Holdings, Inc.; Secretary and Director of Delaware International Holdings Ltd.; and
Director of Delaware International Advisers Ltd.
Director of ICI Mutual Insurance Co. since 1992, P.O. Box 730, Burlington, VT
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
vii
<PAGE> 115
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with the Manager and its
Business Address* Affiliates and Other Positions and Offices Held
- ----------------------- ---------------------------------------------------------------------------------
<S> <C>
Richard J. Flannery Managing Director/Corporate Tax & Affairs of Delaware Management Company, Inc., Delaware
Management Holdings, Inc., DMH Corp., Delaware Distributors, L.P., Delaware Distributors,
Inc., Delaware Service Company, Inc., Delaware Management Trust Company, Delaware
International Holdings Ltd., Delaware Investment Counselors, Inc. and Founders CBO
Corporation; Vice President of the Registrant and each of the other funds in the Delaware
Group; Managing Director/Corporate Tax & Affairs and Director of Founders Holdings, Inc.;
and Director of Delaware International Advisers Ltd.
Limited Partner of Stonewall Links, L.P. since 1991, Bulltown Rd., Elverton, PA; Director
and Member of Executive Committee of Stonewall Links, Inc. since 1991, Bulltown Rd.,
Elverton, PA
Michael P. Bishof(1) Vice President and Treasurer of Delaware Management Company, Inc., the Registrant, each
of the other funds in the Delaware Group, Delaware Management Holdings, Inc., DMH Corp.,
Delaware Distributors, L.P., Delaware Distributors, Inc., Delaware Service Company, Inc.,
Founders Holdings, Inc. and Founders CBO Corporation
Eric E. Miller Vice President and Assistant Secretary of Delaware Management Company, Inc., the
Registrant, each of the other funds in the Delaware Group, Delaware Management Holdings,
Inc., DMH Corp., Delaware Distributors, L.P., Delaware Distributors Inc., Delaware
Service Company, Inc., Delaware Management Trust Company, Founders Holdings, Inc. and
Delaware Investment Counselors, Inc.
Richelle S. Maestro Vice President and Assistant Secretary of Delaware Management Company, Inc., the
Registrant, each of the other funds in the Delaware Group, Delaware Management Holdings,
Inc., Delaware Distributors, L.P., Delaware Distributors, Inc., Delaware Service Company,
Inc., DMH Corp., Delaware Management Trust Company, Delaware Investment Counselors, Inc.
and Founders Holdings, Inc.; and Assistant Secretary of Founders CBO Corporation
General Partner of Tri-R Associates since 1989, 10001 Sandmeyer Ln., Philadelphia, PA
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
viii
<PAGE> 116
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with the Manager and its
Business Address* Affiliates and Other Positions and Offices Held
- ----------------------- ---------------------------------------------------------------------------------
<S> <C>
Joseph H. Hastings Vice President/Corporate Controller of Delaware Management Company, Inc., the Registrant,
each of the other funds in the Delaware Group, Delaware Management Holdings, Inc., DMH
Corp., Delaware Distributors, L.P., Delaware Distributors, Inc., Delaware Service
Company, Inc., Delaware Investment Counselors, Inc. and Founders Holdings, Inc.;
Executive Vice President, Chief Financial Officer and Treasurer of Delaware Management
Trust Company; and Assistant Treasurer of Founders CBO Corporation
Bruce A. Ulmer Vice President/Director of Internal Audit of Delaware Management Company, Inc., the
Registrant, each of the other funds in the Delaware Group, Delaware Management Holdings,
Inc., DMH Corp. and Delaware Management Trust Company
Lisa O. Brinkley(2) Vice President/Compliance of Delaware Management Company, Inc., the Registrant, each of
the other funds in the Delaware Group, DMH Corp., Delaware Distributors, L.P., Delaware
Distributors, Inc., Delaware Service Company, Inc., Delaware Management Trust Company and
Delaware Investment Counselors, Inc.
Rosemary E. Milner Vice President/Legal of Delaware Management Company, Inc., the Registrant, each of the
other funds in the Delaware Group, Delaware Distributors, L.P. and Delaware Distributors,
Inc.
Douglas L. Anderson(3) Vice President/Operations of Delaware Management Company, Inc. and Delaware Service
Company, Inc.; and Vice President/Operations and Director of Delaware Management Trust
Company
Michael T. Taggart(4) Vice President/Facilities Management and Administrative Services of Delaware Management
Company, Inc.
Gerald T. Nichols Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., each of the
tax-exempt funds, the fixed income funds and the closed-end funds in the Delaware Group;
Vice President of Founders Holdings, Inc.; and Treasurer and Director of Founders CBO
Corporation
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
ix
<PAGE> 117
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with the Manager and its
Business Address* Affiliates and Other Positions and Offices Held
- ----------------------- ---------------------------------------------------------------------------------
<S> <C>
J. Michael Pokorny Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., each of the
tax-exempt funds and the fixed income funds in the Delaware Group
Gary A. Reed Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., each of the
tax-exempt funds and the fixed income funds in the Delaware Group and Delaware Investment
Counselors, Inc.
Paul A. Matlack Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., each of the
tax-exempt funds, the fixed income funds and the closed-end funds in the Delaware Group;
Vice President of Founders Holdings, Inc.; and Secretary and Director of Founders CBO
Corporation
James R. Raith, Jr. Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., each of the
tax-exempt funds, the fixed income funds and the closed-end funds in the Delaware Group;
Vice President of Founders Holdings, Inc.; and President and Director of Founders CBO
Corporation
Patrick P. Coyne Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., each of the
tax-exempt funds and the fixed income funds in the Delaware Group
Roger A. Early(5) Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., each of the
tax-exempt funds and the fixed income funds in the Delaware Group
Edward N. Antoian Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., the
Registrant and each of the other equity funds in the Delaware Group
George H. Burwell Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., the
Registrant and each of the other equity funds in the Delaware Group
John B. Fields Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., the
Registrant, each of the other equity funds in the Delaware Group and Delaware Investment
Counselors, Inc.
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
x
<PAGE> 118
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices with the Manager and its
Business Address* Affiliates and Other Positions and Offices Held
- ----------------------- ---------------------------------------------------------------------------------
<S> <C>
Edward A. Trumpbour Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., the
Registrant and each of the other equity funds in the Delaware Group
David C. Dalrymple Vice President/Senior Portfolio Manager of Delaware Management Company, Inc., the
Registrant and each of the other equity funds in the Delaware Group
</TABLE>
(1) VICE PRESIDENT/GLOBAL INVESTMENT MANAGEMENT OPERATIONS, Bankers
Trust and VICE PRESIDENT, CS First Boston Investment Management
prior to June 1995.
(2) VICE PRESIDENT AND COMPLIANCE OFFICER, Banc One Securities prior
to June 1994 and ASSISTANT VICE PRESIDENT AND COMPLIANCE
OFFICER, Aetna Life and Casualty prior to March 1993.
(3) VICE PRESIDENT OF OPERATIONS, Supervised Service Company prior
to March 1994.
(4) ASSISTANT VICE PRESIDENT/ADMINISTRATIVE SERVICES, United Pacific
Life Insurance prior to January 1994.
(5) SENIOR VICE PRESIDENT AND PORTFOLIO MANAGER, Federated Investors
prior to July 1994.
Item 29. Principal Underwriters.
(a) Delaware Distributors, L.P. serves as
principal underwriter for all the mutual
funds in the Delaware Group.
(b) Information with respect to each director,
officer or partner of principal underwriter:
<TABLE>
<CAPTION>
Name and Principal Positions and Offices Positions and Offices
Business Address* with Underwriter with Registrant
- ----------------------------- --------------------- -----------------------
<S> <C> <C>
Delaware Distributors, Inc. General Partner None
Delaware Management
Company, Inc. Limited Partner Investment Manager
Delaware Investment
Counselors, Inc. Limited Partner None
Winthrop S. Jessup Vice Chairman Executive Vice President
Keith E. Mitchell President and Chief None
Executive Officer
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
xi
<PAGE> 119
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices Positions and Offices
Business Address* with Underwriter with Registrant
- ----------------------------- --------------------- -----------------------
<S> <C> <C>
David K. Downes Senior Vice President/Chief Senior Vice President/Chief
Administrative Officer Administrative Officer/Chief
Financial Officer
George M. Chamberlain, Jr. Senior Vice President/ Senior Vice President/
Secretary Secretary
J. Lee Cook Senior Vice President/ None
National Sales Manager
Stephen H. Slack Senior Vice President/ None
Wholesaler
William F. Hostler Senior Vice President/ None
Marketing Services
Minette van Noppen Senior Vice President/ None
Retirement Services
Richard J. Flannery Managing Director/Corporate Vice President
& Tax Affairs
Eric E. Miller Vice President/ Vice President/
Assistant Secretary Assistant Secretary
Richelle S. Maestro Vice President/ Vice President/
Assistant Secretary Assistant Secretary
Joseph H. Hastings Vice President/ Vice President/
Corporate Controller Corporate Controller
Michael P. Bishof Vice President/Treasurer Vice President/Treasurer
Lisa O. Brinkley Vice President/ Vice President/
Compliance Compliance
Rosemary E. Milner Vice President/Legal Vice President/Legal
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
xii
<PAGE> 120
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices Positions and Offices
Business Address* with Underwriter with Registrant
- ----------------------------- --------------------- -----------------------
<S> <C> <C>
Diane M. Anderson Vice President/ None
Retirement Services
Denise F. Guerriere Vice President/Client Services None
Julia R. Vander Els Vice President/ None
Retirement Services
Jerome J. Alrutz Vice President/ None
Retirement Services
Martin J. Cole Vice President/ None
Retirement Services
Joanne A. Mettenheimer Vice President/ None
National Accounts
Christopher H. Price Vice President/Annuity None
Marketing & Administration
Thomas S. Butler Vice President/ None
DDI Administration
Frank Albanese Vice President/Wholesaler None
William S. Carroll Vice President/Wholesaler None
William S. Castetter Vice President/Wholesaler None
Thomas J. Chadie Vice President/Wholesaler None
Robert M. Frank Vice President/Wholesaler None
Douglas R. Glennon Vice President/Wholesaler None
Alan D. Kessler Vice President/Wholesaler None
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
xiii
<PAGE> 121
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Positions and Offices Positions and Offices
Business Address* with Underwriter with Registrant
- ----------------------------- --------------------- -----------------------
<S> <C> <C>
William M. Kimbrough Vice President/Wholesaler None
Mac McAuliffe Vice President/Wholesaler None
Patrick L. Murphy Vice President/Wholesaler None
Henry W. Orvin Vice President/Wholesaler None
Philip G. Rickards Vice President/Wholesaler None
Dion D. Rooney Vice President/Wholesaler None
Michael W. Rose Vice President/Wholesaler None
Thomas E. Sawyer Vice President/Wholesaler None
Sanford G. Simmons, Jr. Vice President/Wholesaler None
Robert E. Stansbury Vice President/Wholesaler None
Larry D. Stone Vice President/Wholesaler None
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
(c) Not Applicable.
Item 30. Location of Accounts and Records.
All accounts and records are maintained in Philadelphia
at 1818 Market Street, Philadelphia, PA 19103 or One
Commerce Square, Philadelphia, PA 19103.
Item 31. Management Services. None.
Item 32. Undertakings.
(a) Not Applicable.
(b) Not Applicable.
xiv
<PAGE> 122
Form N-1A
File No. 2-28871
Delaware Group Trend Fund, Inc.
(c) The Registrant hereby undertakes to furnish each
person to whom a prospectus is delivered with a
copy of the Registrant's latest annual report to
shareholders, upon request and without charge.
(d) The Registrant hereby undertakes to promptly call a
meeting of shareholders for the purpose of voting
upon the question of removal of any director when
requested in writing to do so by the record holders
of not less than 10% of the outstanding shares.
xv
<PAGE> 123
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, this Registrant certifies that it meets all of the
requirements for effectiveness of this Registration Statement pursuant to Rule
485(b) under the Securities Act of 1933 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in this City of Philadelphia, Commonwealth of Pennsylvania on
this 17th day of November, 1995.
DELAWARE GROUP TREND FUND, INC.
By/s/Wayne A. Stork
----------------------------------
Wayne A. Stork
Chairman of the Board, President,
Chief Executive Officer and Director
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed below by the following persons in the capacities and
on the dates indicated:
<TABLE>
<CAPTION>
Signature Title Date
- ----------------------------------------------- -------------------------------------------- --------------------
<S> <C> <C>
Chairman of the Board, President,
/s/Wayne A. Stork Chief Executive Officer and Director November 17, 1995
- ------------------------------------------------
Wayne A. Stork
Senior Vice President/Chief Financial
Officer/Chief Administrative Officer
(Principal Financial Officer and
/s/David K. Downes Principal Accounting Officer) November 17, 1995
- ------------------------------------------------
David K. Downes
/s/Walter P. Babich * Director November 17, 1995
- ------------------------------------------------
Walter P. Babich
/s/Anthony D. Knerr * Director November 17, 1995
- ------------------------------------------------
Anthony D. Knerr
/s/Ann R. Leven * Director November 17, 1995
- ------------------------------------------------
Ann R. Leven
/s/W. Thacher Longstreth * Director November 17, 1995
- ------------------------------------------------
W. Thacher Longstreth
/s/Charles E. Peck * Director November 17, 1995
- ------------------------------------------------
Charles E. Peck
</TABLE>
*By/s/Wayne A. Stork
---------------------------------------
Wayne A. Stork
as Attorney-in-Fact for
each of the persons indicated
<PAGE> 124
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
Exhibits
to
Form N-1A
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
<PAGE> 125
INDEX TO EXHIBITS
<TABLE>
<CAPTION>
Exhibit No. Exhibit
- ----------- -------
<S> <C>
EX-99.B1B Form of Articles Supplementary (November 1995)
EX-99.B6AI Form of Distribution Agreement (April 1995)
(Module Name
DIS_AGR_NON_MON)
EX-99.B6AII Form of Amendment No. 1 to Distribution Agreement
(Module Name (November 1995)
AMD_DIS_AGR_NON)
EX-99.B6B Form of Administration and Service Agreement
(Module Name (as amended November 1995)
ADMIN_SER_AGREE)
EX-99.B6C Form of Dealer's Agreement (as amended November 1995)
(Module Name
DEALERS_AGREE)
EX-99.B11 Consent of Auditors
EX-99.B15A Form of Plan under Rule 12b-1 for Class A (November 1995)
(Module Name
CL_A_SHARE_NON)
EX-99.B15B Form of Plan under Rule 12b-1 for Class B (November 1995)
(Module Name
CL_B_SHARE_ALL)
EX-99.B15C Form of Plan under Rule 12b-1 for Class C (November 1995)
(Module Name
CL_C_SHARE_ALL)
EX-99.B18 Form of Plan under Rule 18f-3
(Module Name
PLAN)
</TABLE>
<PAGE> 1
EX 99.B1B
DELAWARE GROUP TREND FUND, INC.
ARTICLES SUPPLEMENTARY
TO
ARTICLES OF INCORPORATION
Delaware Group Trend Fund, Inc., a Maryland corporation having
its principal office in Baltimore, Maryland (the "Corporation"), hereby
certifies, in accordance with Section 2-208 and Section 2-208.1 of the Maryland
General Corporation Law, to the State Department of Assessments and Taxation of
Maryland that:
FIRST: The Corporation has authority to issue a total of One
Hundred Million (100,000,000) shares of common stock with a par value of Fifty
Cents ($0.50) per share of the Corporation (the "Common Stock"), having an
aggregate par value of Fifty Million Dollars ($50,000,000). Of such One
Hundred Million (100,000,000) shares of Common Stock, Eighty-Five Million
(85,000,000) shares have been allocated to the Common Stock series of the
Common Stock as follows: (1) Twenty-Five Million (25,000,000) shares have been
allocated to each of the Trend Fund (Institutional) class and Trend Fund B
Class and (2) Thirty-Five Million (35,000,000) shares have been allocated to
the Trend Fund class.
SECOND: The Board of Directors of the Corporation, at a
meeting held on July 20, 1995, adopted resolutions increasing the aggregate
number of shares of Common Stock that the Corporation has authority to issue to
Five Hundred Million (500,000,000) shares, classifying a fourth class of shares
of the Common Stock series of the Common Stock as the Trend Fund C Class (the
"C Class"), classifying and allocating Twenty-Five Million (25,000,000) shares
of authorized, unissued and unclassified Common Stock to the C Class, and
classifying and allocating an additional Fifteen Million (15,000,000) shares of
authorized, unissued and unallocated Common Stock to the Trend Fund class of
the Common Stock series of the Common Stock.
THIRD: As a result of the aforesaid increase in the
authorized Common Stock and classifications, the Corporation has authority to
issue Five Hundred Million (500,000,000) shares of Common Stock, having an
aggregate par value of Two Hundred Fifty Million Dollars ($250,000,000). Of
such Five Hundred Million (500,000,000) shares of Common Stock, One Hundred
Twenty-Five Million (125,000,000) shares have been allocated to the Common
Stock series of the Common Stock as follows: (1) Twenty-Five
<PAGE> 2
Million (25,000,000) shares have been allocated to each of the Trend Fund
(Institutional) class, the Trend Fund B Class and the C Class and (2) Fifty
Million (50,000,000) shares have been allocated to the Trend Fund class.
FOURTH: The shares of the C Class shall represent
proportionate interests in the same portfolio of investments as the shares of
the Trend Fund (Institutional) class, Trend Fund B Class and Trend Fund class
of the Common Stock series of the Common Stock. The shares of the C Class
shall have the same preferences, conversion or other rights, voting powers,
restrictions, limitations as to dividends, qualifications, or terms or
conditions of redemption as the shares of the Trend Fund (Institutional) class,
Trend Fund B Class and Trend Fund class of the Common Stock series of the
Common Stock, all as set forth in the Articles of Incorporation of the
Corporation, except for the differences hereinafter set forth:
1. The dividends and distributions of investment income
and capital gains with respect to shares of the C Class shall
be in such amounts as may be declared from time to time by the
Board of Directors, and such dividends and distributions may
vary with respect to such class from the dividends and
distributions of investment income and capital gains with
respect to the other classes of the Common Stock series of the
Common Stock to reflect differing allocations of the expenses
of the Corporation among the shares of such classes and any
resultant difference among the net asset values per share of
the shares of such classes, to such extent and for such
purposes as the Board of Directors may deem appropriate. The
allocation of investment income and capital gains and expenses
and liabilities of the Corporation among the four classes of
the Common Stock series of the Common Stock shall be
determined by the Board of Directors in a manner that is
consistent with the order, as applicable, dated September 6,
1994 (Investment Company Act of 1940 Release No. 20529) issued
by the Securities and Exchange Commission, and any amendments
to such order, any future order or any Multiple Class Plan
adopted by the Corporation in accordance with Rule 18f-3 under
the Investment Company Act of 1940, as amended, that modifies
or supersedes such order.
2. Except as may otherwise be required by law pursuant
to any applicable order, rule or interpretation issued by the
Securities and Exchange Commission, or otherwise, the holders
of shares of the C Class shall have (i) exclusive voting
rights with respect to any matter submitted to a vote of
stockholders that affects only holders of shares of the
-2-
<PAGE> 3
C Class, including without limitation the provisions of any
Distribution Plan adopted pursuant to Rule 12b-1 under the
Investment Company Act of 1940, as amended (a "Distribution
Plan") applicable to shares of the C Class, and (ii) no voting
rights with respect to the provisions of any Distribution Plan
applicable to any other class of Common Stock or with regard
to any other matter submitted to a vote of stockholders which
does not affect holders of shares of the C Class.
3. The shares of the C Class shall not automatically
convert into shares of the Trend Fund class of the Common
Stock series of the Common Stock as do the shares of the Trend
Fund B Class of the Common Stock series of the Common Stock.
FIFTH: The Corporation is registered as an open-end company
under the Investment Company Act of 1940, as amended.
SIXTH: The total number of shares of Common Stock that the
Corporation has authority to issue has been increased by the Board of Directors
in accordance with Section 2-105(c) of the Maryland General Corporation Law.
SEVENTH: The shares of Common Stock classified as shares of
the Trend Fund class of the Common Stock series of the Common Stock and the C
Class, respectively, pursuant to these Articles Supplementary have been
classified by the Board of Directors pursuant to authority contained in the
Articles of Incorporation of the Corporation.
EIGHTH: These Articles Supplementary shall become effective
on November 28, 1995.
IN WITNESS WHEREOF, Delaware Group Trend Fund, Inc. has caused
these Articles Supplementary to be signed in its name and on its behalf this
____ day of November, 1995.
DELAWARE GROUP TREND FUND, INC.
By:
---------------------------------
George M. Chamberlain, Jr.
Senior Vice President
ATTEST:
- --------------------------------
Assistant Secretary
-3-
<PAGE> 4
THE UNDERSIGNED, Senior Vice President of DELAWARE GROUP TREND
FUND, INC., who executed on behalf of the said Corporation the foregoing
Articles Supplementary, of which this instrument is made a part, hereby
acknowledges, in the name of and on behalf of said Corporation, said Articles
Supplementary to be the corporate act of said Corporation and further certifies
that, to the best of his knowledge, information and belief, the matters and
facts set forth therein with respect to the authorization and approval thereof
are true in all material respects, under the penalties of perjury.
--------------------------------------
George M. Chamberlain, Jr.
Senior Vice President
-4-
<PAGE> 1
<PAGE>
[FORM OF DISTRIBUTION AGREEMENT]
[FUND NAME]
[SERIES NAME, IF APPLICABLE]
DISTRIBUTION AGREEMENT
Distribution Agreement (the "Agreement") made as of this 3rd
day of April, 1995 by and between [FUND NAME], a [Maryland
corporation/Pennsylvania common law trust] (the "Fund")[, for the [SERIES NAME]
(the "Series")] and DELAWARE DISTRIBUTORS, L.P. (the "Distributor"), a Delaware
limited partnership.
WITNESSETH
WHEREAS, the Fund is an investment company regulated by
Federal and State regulatory bodies, and
WHEREAS, the Distributor is engaged in the business of
promoting the distribution of the securities of investment companies and, in
connection therewith and acting solely as agent for such investment companies
and not as principal, advertising, promoting, offering and selling their
securities to the public, and
WHEREAS, the Fund and the Distributor (or its predecessor)
were the parties to a contract under which the Distributor acted as the national
distributor of the shares of the [Fund/Series], which contract was amended and
restated as of the [date] and subsequently readopted as of January 3, 1995 (the
"Prior Distribution Agreement"), and
WHEREAS, Delaware Management Holdings, Inc. ("Holdings"),
the indirect parent company of the Distributor, completed on the
date of this Agreement a merger transaction with a newly-formed
subsidiary of Lincoln National Corporation, pursuant to which
Holdings became a wholly-owned subsidiary of Lincoln National
Corporation, and
<PAGE>
WHEREAS, the merger transaction resulted in a change of
control of the Distributor and an automatic termination of the Prior
Distribution Agreement, and
WHEREAS, the Board of [Directors/Trustees] of the Fund has
determined to enter into a new agreement with the Distributor as of the date
hereof, pursuant to which the Distributor shall continue to be the national
distributor of the [Fund's/Series'] ____________ class (now doing business as
___________ A Class and hereinafter referred to as the "Class A Shares"), the
Fund's ___________ B Class (the "Class B Shares") and the Fund's ______________
(Institutional) class (now doing business as _____________ Institutional Class
and hereinafter referred to as the "Institutional Class Shares"), which classes
may do business under these or such other names as the Board of
[Directors/Trustees] may designate from time to time, on the terms and
conditions set forth below,
NOW, THEREFORE, the parties hereto, intending to be
legally bound hereby, agree as follows:
1. The Fund hereby engages the Distributor to promote the distribution of
the [Fund's/Series'] shares and, in connection therewith and as agent
for the Fund and not as principal, to advertise, promote, offer and
sell the [Fund's/Series'] shares to the public.
<PAGE>
2. (a) The Distributor agrees to serve as distributor of the
[Fund's/Series'] shares and, as agent for the Fund and
not as principal, to advertise, promote and use its best
efforts to sell the [Fund's/Series'] shares wherever
their sale is legal, either through dealers or otherwise,
in such places and in such manner, not inconsistent with
the law and the provisions of this Agreement and the
Fund's Registration Statement under the Securities Act of
1933, including the Prospectus contained therein and the
Statement of Additional Information contained therein, as
may be mutually determined by the Fund and the
Distributor from time to time.
(b) For the Institutional Class Shares, the Distributor will bear
all costs of financing any activity which is primarily
intended to result in the sale of that class of shares,
including, but not necessarily limited to, advertising,
compensation of underwriters, dealers and sales personnel, the
printing and mailing of sales literature and distribution of
that class of shares.
(c) For its services as agent for the Class A Shares and Class B
Shares, the Distributor shall be entitled to compensation on
each sale or redemption, as appropriate, of shares of such
classes equal to any front-end or deferred sales charge
described in the Prospectus from time to time and may allow
concessions to dealers in such amounts and on such terms as
are therein set forth.
<PAGE>
(d) For the Class A Shares and Class B Shares, the Fund
shall, in addition, compensate the Distributor for its
services as provided in the Distribution Plan as adopted
on behalf of the Class A Shares and Class B Shares,
respectively, pursuant to Rule 12b-1 under the
Investment Company Act of 1940 (the "Plans"), copies of
which as presently in force are attached hereto as,
respectively, Exhibit "A" and "B".
3. (a) The Fund agrees to make available for sale by the Fund
through the Distributor all or such part of the authorized but
unissued shares [of the Series] as the Distributor shall
require from time to time, and except as provided in Paragraph
3(b) hereof, the Fund will not sell [its/the Series'] shares
other than through the efforts of the Distributor.
(b) The Fund reserves the right from time to time (1) to sell
and issue shares other than for cash; (2) to issue shares
in exchange for substantially all of the assets of any
corporation or trust, or in exchange of shares of any
corporation or trust; (3) to pay stock dividends to its
shareholders, or to pay dividends in cash or stock at the
option of its stockholders, or to sell stock to existing
stockholders to the extent of dividends payable from time
to time in cash, or to split up or combine its
outstanding shares of common stock; (4) to offer shares
for cash to its stockholders as a whole, by the use of
transferable rights or otherwise, and to sell and issue shares
pursuant to such offers; and (5) to act as its own distributor
in any jurisdiction in which the Distributor is not registered
as a broker-dealer.
<PAGE>
4. The Fund warrants the following:
(a) The Fund is, or will be, a properly registered investment
company, and any and all [Series] shares which it will sell
through the Distributor are, or will be, properly registered
with the Securities and Exchange Commission ("SEC").
(b) The provisions of this Agreement do not violate the terms of
any instrument by which the Fund is bound, nor do they violate
any law or regulation of any body having jurisdiction over the
Fund or its property.
5. (a) The Fund will supply to the Distributor a conformed copy
of the Registration Statement, all amendments thereto,
all exhibits, and each Prospectus and Statement of
Additional Information.
(b) The Fund will register or qualify the shares for sale in
such states as is deemed desirable.
(c) The Fund, without expense to the Distributor,
(1) will give and continue to give such financial
statements and other information as may be required
by the SEC or the proper public bodies of the
states in which the [Fund's/Series'] shares may be
qualified;
(2) from time to time, will furnish the Distributor as
soon as reasonably practicable true copies of its
periodic reports to stockholders;
<PAGE>
(3) will promptly advise the Distributor in person or by
telephone or telegraph, and promptly confirm such
advice in writing, (a) when any amendment or
supplement to the Registration Statement becomes
effective, (b) of any request by the SEC for
amendments or supplements to the Registration
Statement or the Prospectus or for additional
information, and (c) of the issuance by the SEC of
any Stop Order suspending the effectiveness of the
Registration Statement, or the initiation of any
proceedings for that purpose;
(4) if at any time the SEC shall issue any Stop Order
suspending the effectiveness of the Registration
Statement, will make every reasonable effort to
obtain the lifting of such order at the earliest
possible moment;
(5) will from time to time, use its best effort to keep a
sufficient supply of [Series] shares authorized, any
increases being subject to approval of the Fund's
shareholders as may be required;
(6) before filing any further amendment to the
Registration Statement or to the Prospectus, will
furnish the Distributor copies of the proposed
amendment and will not, at any time, whether before
or after the effective date of the Registration
Statement, file any amendment to the Registration
Statement or supplement to the Prospectus of which
the Distributor shall not previously have been
advised or to which the Distributor shall reasonably
object (based upon the accuracy or completeness
thereof) in writing;
(7) will continue to make available to its stockholders
(and forward copies to the Distributor) of such
periodic, interim and any other reports as are now,
or as hereafter may be, required by the provisions of
the Investment Company Act of 1940; and
(8) will, for the purpose of computing the offering price
of [its/the Series'] shares, advise the Distributor
within one hour after the close of the New York Stock
Exchange (or as soon as practicable thereafter) on
each business day upon which the New York Stock
Exchange may be open of the net asset value per share
of [its/the Series'] shares of common stock outstand-
ing, determined in accordance with any applicable
provisions of law and the provisions of the Articles
of Incorporation, as amended, of the Fund as of the
close of business on such business day. In the event
that prices are to be calculated more than once
daily, the Fund will promptly advise the Distributor
of the time of each calculation and the price
computed at each such time.
<PAGE>
6. The Distributor agrees to submit to the Fund, prior to its
use, the form of all sales literature proposed to be generally
disseminated by or for the Distributor, all advertisements
proposed to be used by the Distributor, all sales literature
or advertisements prepared by or for the Distributor for such
dissemination or for use by others in connection with the sale
of the [Fund's/Series'] shares, and the form of dealers' sales
contract the Distributor intends to use in connection with
sales of the [Fund's/Series'] shares. The Distributor also
agrees that the Distributor will submit such sales literature
and advertisements to the NASD, SEC or other regulatory agency
as from time to time may be appropriate, considering practices
then current in the industry. The Distributor agrees not to
use such form of dealers' sales contract or to use or to
permit others to use such sales literature or advertisements
without the written consent of the Fund if any regulatory
agency expresses objection thereto or if the Fund delivers to
the Distributor a written objection thereto.
7. The purchase price of each share sold hereunder shall be the offering
price per share mutually agreed upon by the parties hereto, and as
described in the Fund's Prospectus, as amended from time to time,
determined in accordance with any applicable provision of law, the
provisions of its Articles of Incorporation and the Rules of Fair
Practice of the National Association of Securities Dealers, Inc.
<PAGE>
8. The responsibility of the Distributor hereunder shall be
limited to the promotion of sales of [Fund/Series] shares. The
Distributor shall undertake to promote such sales solely as
agent of the Fund, and shall not purchase or sell such shares
as principal. Orders for [Series] shares and payment for such
orders shall be directed to the Fund's agent, Delaware Service
Company, Inc. for acceptance on behalf of the Fund. The
Distributor is not empowered to approve orders for sales of
shares or accept payment for such orders. Sales of [Fund/
Series] shares shall be deemed to be made when and where
accepted by Delaware Service Company, Inc. on behalf of the
Fund.
9. With respect to the apportionment of costs between the Fund
and the Distributor of activities with which both are
concerned, the following will apply:
(a) The Fund and the Distributor will cooperate in preparing
the Registration Statements, the Prospectus, the
Statement of Additional Information, and all amendments,
supplements and replacements thereto. The Fund will pay
all costs incurred in the preparation of the Fund's
Registration Statement, including typesetting, the costs
incurred in printing and mailing Prospectuses and Annual,
Semi-Annual and other financial reports to its own
shareholders and fees and expenses of counsel and
accountants.
<PAGE>
(b) The Distributor will pay the costs incurred in printing
and mailing copies of Prospectuses to prospective
investors.
(c) The Distributor will pay advertising and promotional
expenses, including the costs of literature sent to
prospective investors.
(d) The Fund will pay the costs and fees incurred in
registering or qualifying the shares with the various
states and with the SEC.
(e) The Distributor will pay the costs of any additional copies of
Fund financial and other reports and other Fund literature
supplied to the Distributor by the Fund for sales promotion
purposes.
10. The Distributor may engage in other business, provided such other
business does not interfere with the performance by the Distributor of
its obligations under this Agreement.
11. The Fund agrees to indemnify, defend and hold harmless the
Distributor and each person, if any, who controls the
Distributor within the meaning of Section 15 of the Securities
Act of 1933, from and against any and all losses, damages, or
liabilities to which, jointly or severally, the Distributor or
such controlling person may become subject, insofar as the
losses, damages or liabilities arise out of the performance of
its duties hereunder except that the Fund shall not be liable
<PAGE>
for indemnification of the Distributor or any controlling person
thereof for any liability to the Fund or its security holders to which
they would otherwise be subject by reason of willful misfeasance, bad
faith, or gross negligence in the performance of their duties under
this Agreement.
12. Copies of financial reports, Registration Statements and
Prospectuses, as well as demands, notices, requests, consents,
waivers, and other communications in writing which it may be
necessary or desirable for either party to deliver or furnish
to the other will be duly delivered or furnished, if delivered
to such party at its address shown below during regular
business hours, or if sent to that party by registered mail or
by prepaid telegram filed with an office or with an agent of
Western Union or another nationally recognized telegraph
service, in all cases within the time or times herein
prescribed, addressed to the recipient at 1818 Market Street,
Philadelphia, Pennsylvania 19103, or at such other address as
the Fund or the Distributor may designate in writing and
furnish to the other.
13. This Agreement shall not be assigned, as that term is defined in the
Investment Company Act of 1940, by the Distributor and shall terminate
automatically in the event of its attempted assignment by the
Distributor. This Agreement shall not be assigned by the Fund without
the written consent of the Distributor signed by its duly authorized
officers and delivered to the Fund. Except as specifically provided in
<PAGE>
the indemnification provision contained in Paragraph 11 herein, this
Agreement and all conditions and provisions hereof are for the sole and
exclusive benefit of the parties hereto and their legal successors and
no express or implied provision of this Agreement is intended or shall
be construed to give any person other than the parties hereto and their
legal successors any legal or equitable right, remedy or claim under or
in respect of this Agreement or any provisions herein contained.
14. (a) This Agreement shall remain in force for a period of two
years from the date hereof and from year to year
thereafter, but only so long as such continuance is
specifically approved at least annually by the Board of
[Directors/Trustees] or by vote of a majority of the
outstanding voting securities of the Fund and only if the
terms and the renewal thereof have been approved by the
vote of a majority of the [Directors/Trustees] of the
Fund, who are not parties hereto or interested persons of
any such party, cast in person at a meeting called for
the purpose of voting on such approval.
(b) The Distributor may terminate this Agreement on written notice
to the Fund at any time in case the effectiveness of the
Registration Statement shall be suspended, or in case Stop
Order proceedings are initiated by the SEC in respect of the
Registration Statement and such proceedings are not withdrawn
or terminated within thirty days. The Distributor may also
<PAGE>
terminate this Agreement at any time by giving the Fund
written notice of its intention to terminate the Agreement at
the expiration of three months from the date of delivery of
such written notice of intention to the Fund.
(c) The Fund may terminate this Agreement at any time on at
least thirty days prior written notice to the Distributor
(1) if proceedings are commenced by the Distributor or
any of its stockholders for the Distributor's liquidation
or dissolution or the winding up of the Distributor's
affairs; (2) if a receiver or trustee of the Distributor
or any of its property is appointed and such appointment
is not vacated within thirty days thereafter; (3) if, due
to any action by or before any court or any federal or
state commission, regulatory body, or administrative
agency or other governmental body, the Distributor shall
be prevented from selling securities in the United States
or because of any action or conduct on the Distributor's
part, sales of the shares are not qualified for sale. The
Fund may also terminate this Agreement at any time upon
prior written notice to the Distributor of its intention
to so terminate at the expiration of three months from
the date of the delivery of such written notice to the
Distributor.
<PAGE>
15. The validity, interpretation and construction of this
Agreement, and of each part hereof, will be governed by the
laws of the Commonwealth of Pennsylvania.
16. In the event any provision of this Agreement is determined to
be void or unenforceable, such determination shall not affect
the remainder of the Agreement, which shall continue to be in
force.
DELAWARE DISTRIBUTORS, L.P.
By: DELAWARE DISTRIBUTORS, INC.,
----------------------------------------
General Partner
Attest:
By:
- -------------------------------- --------------------------------------
Name: Name:
Title: Title:
[FUND NAME]
[for the SERIES NAME]
Attest:
By:
- -------------------------------- --------------------------------------
Name: Name:
Title: Title:
<PAGE>
[FORM OF 12b-1 PLAN FOR CLASS A SHARES]
Exhibit A
12b-1 PLAN
----------
The following Distribution Plan (the "Plan") has been adopted pursuant to
Rule 12b-1 under the Investment Company Act of 1940 (the "Act") by [FUND NAME]
(the "Fund")[, for the [SERIES NAME] (the "Series")] on behalf of the _________
class [(now doing business as __________ A Class and] hereinafter referred to as
the "Class"), which Fund[, Series] and Class may do business under these or such
other names as the Board of [Directors/Trustees] of the Fund may designate from
time to time. The Plan has been approved by a majority of the Board of
[Directors/Trustees], including a majority of the [Directors/Trustees] who are
not interested persons of the Fund and who have no direct or indirect financial
interest in the operation of the Plan or in any agreements related thereto, cast
in person at a meeting called for the purpose of voting on such Plan. Such
approval by the [Directors/Trustees] included a determination that in the
exercise of reasonable business judgment and in light of their fiduciary duties,
there is a reasonable likelihood that the Plan will benefit the Class and its
shareholders. If the Plan has not yet been approved by a majority of the
outstanding voting securities as required in the Act, the Plan will be presented
to the public shareholders at the next regular annual or special meeting.
<PAGE>
The Fund is a [corporation/common law trust] organized under the laws of
the [State of Maryland/Commonwealth of Pennsylvania], is authorized to issue
different series and classes of securities and is an open-end management
investment company registered under the Act. [Delaware Management Company, Inc.
("DMC")/Delaware International Advisers Ltd. ("DIA Ltd.")] serves as the
[Fund's/Series'] investment adviser and manager pursuant to an Investment
Management Agreement. Delaware Service Company, Inc. serves as the
[Fund's/Series'] shareholder servicing, dividend disbursing and transfer agent.
Delaware Distributors, L.P. ("the Distributor") is the principal underwriter and
national distributor for the [Fund's/Series'] shares, including shares of the
Class, pursuant to the Distribution Agreement between the Distributor and the
[Fund/Series] ("Distribution Agreement").
The Distributor may enter into agreements with other registered
broker-dealers substantially in the form of the Dealer Agreement approved by the
Fund in the implementation of this Plan and of the Distribution Agreement
between it and the [Fund/Series]. The [Fund/Series] may, in addition, enter into
arrangements with persons other than broker-dealers which are not "affiliated
persons" or "interested persons" of the Fund, [DMC/DIA Ltd.] or the Distributor
to provide to the [Fund/Series] services in the [Fund's/Series'] marketing of
the shares of the Class, such arrangements to be reflected by Service
Agreements.
<PAGE>
The Plan provides that:
l. The Fund shall pay a monthly fee not to exceed 0.3% (3/10
of 1%) per annum of the [Fund's/Series'] average daily net assets represented by
shares of the Class (the "Maximum Amount") as may be determined by the Fund's
Board of [Directors/Trustees] from time to time. Such monthly fee shall be
reduced by the aggregate sums paid by the Fund to persons other than
broker-dealers (the "Service Providers") pursuant to Service Agreements referred
to above.
2. (a) The Distributor shall use the monies paid to it
pursuant to paragraph l above to furnish, or cause or encourage others to
furnish, services and incentives in connection with the promotion, offering and
sale of Class shares and, where suitable and appropriate, the retention of Class
shares by shareholders.
(b) The Service Providers shall use the monies paid
respectively to them to reimburse themselves for the actual costs they have
incurred in confirming that their customers have received the Prospectus and
Statement of Additional Information, if applicable, and as a fee for (l)
assisting such customers in maintaining proper records with the Fund (2)
answering questions relating to their respective accounts and (3) aiding in
maintaining the investment of their respective customers in the Class.
3. The Distributor shall report to the Fund at least monthly
on the amount and the use of the monies paid to it under the Plan. The Service
Providers shall inform the Fund monthly and in writing of the amounts each
claims under the Service Agreements and the Plan; both the Distributor and the
<PAGE>
Service Providers shall furnish the Board of [Directors/Trustees] of the Fund
with such other information as the Board may reasonably request in connection
with the payments made under the Plan and the use thereof by the Distributor and
the Service Providers, respectively, in order to enable the Board to make an
informed determination of the amount of the Fund's payments and whether the Plan
should be continued.
4. The officers of the Fund shall furnish to the Board of
[Directors/Trustees] of the Fund, for their review, on a quarterly basis, a
written report of the amounts expended under the Plan and the purposes for which
such expenditures were made.
5. This Plan shall take effect at such time as the Distributor
shall notify the Fund in writing of the commencement of the Plan, which time
shall not be before the first annual or special meeting of the public
shareholders at which the Plan is or was approved by the vote of a majority of
the outstanding voting securities as required in the Act (the "Commencement
Date"); thereafter, the Plan shall continue in effect for a period of more than
one year from the Commencement Date only so long as such continuance is
specifically approved at least annually by a vote of the Board of
[Directors/Trustees] of the Fund, and of the [Directors/Trustees] who are not
interested persons of the Fund and have no direct or indirect financial interest
in the operation of the Plan or in any agreements related to the Plan
("non-interested [Directors/Trustees]"), cast in person at a meeting called for
the purpose of voting on such Plan.
<PAGE>
6. (a) The Plan may be terminated at any time by vote
of a majority of the non-interested [Directors/Trustees] or by vote
of a majority of the outstanding voting securities of the Class.
(b) The Plan may not be amended to increase
materially the amount to be spent for distribution pursuant to paragraph l
thereof without approval by the shareholders of the Class.
7. The Distribution Agreement between the [Fund/Series] and
the Distributor, and the Service Agreements between the [Fund/ Series] and the
Service Providers, shall specifically have a copy of this Plan attached to, and
its terms and provisions incorporated respectively by reference in, such
agreements.
8. All material amendments to this Plan shall be approved by
the non-interested [Directors/Trustees] in the manner described in paragraph 5
above.
9. So long as the Plan is in effect, the selection and
nomination of the Fund's non-interested [Directors/Trustees] shall be committed
to the discretion of such non-interested [Directors/Trustees].
10. The definitions contained in Sections 2(a)(3), 2(a)(4),
2(a)(l9) and 2(a)(42) of the Act shall govern the meaning of "affiliated
person," "assignment," "interested person(s)" and "vote of a majority of the
outstanding voting securities," respectively, for the purposes of this Plan.
This Plan shall take effect on the Commencement Date, as
previously defined.
<PAGE>
[FORM OF 12b-1 PLAN FOR CLASS B SHARES]
Exhibit B
12b-1 Plan
----------
The following Distribution Plan (the "Plan") has been adopted pursuant to
Rule 12b-1 under the Investment Company Act of 1940 (the "Act") by [FUND NAME]
(the "Fund"), [for the [SERIES NAME] (the "Series")] on behalf of the _________
B Class (the "Class"), which Fund[, Series] and Class may do business under
these or such other names as the Board of [Directors/Trustees] of the Fund may
designate from time to time. The Plan has been approved by a majority of the
Board of [Directors/Trustees], including a majority of the [Directors/Trustees]
who are not interested persons of the Fund and who have no direct or indirect
financial interest in the operation of the Plan or in any agreements related
thereto, cast in person at a meeting called for the purpose of voting on such
Plan. Such approval by the [Directors/Trustees] included a determination that in
the exercise of reasonable business judgment and in light of their fiduciary
duties, there is a reasonable likelihood that the Plan will benefit the Class
and its shareholders. The Plan has been approved by a vote of the holders of a
majority of the outstanding voting securities of the Class, as defined in the
Act.
The Fund is a [corporation/common law trust] organized under the laws of
the [State of Maryland/Commonwealth of Pennsylvania], is authorized to issue
different series and classes of securities and is an open-end management
investment company registered under the Act. [Delaware Management Company,
Inc./Delaware International Advisers Ltd.] serves as the [Fund's/Series']
investment adviser and manager pursuant to an Investment Management Agreement.
Delaware Service Company, Inc. serves as the [Fund's/Series'] shareholder
servicing, dividend disbursing and transfer agent. Delaware Distributors, L.P.
(the "Distributor") is the principal underwriter and national distributor for
the [Fund's/Series'] shares, including shares of the Class, pursuant to the
Distribution Agreement between the Distributor and the [Fund/Series]
("Distribution Agreement").
<PAGE>
The Plan provides that:
1. (a) The Fund shall pay to the Distributor a monthly fee not
to exceed 0.75% (3/4 of 1%) per annum of the [Fund's/ Series'] average daily net
assets represented by shares of the Class as may be determined by the Fund's
Board of [Directors/Trustees] from time to time.
(b) In addition to the amounts described in (a) above, the
Fund shall pay (i) to the Distributor for payment to dealers or others, or (ii)
directly to others, an amount not to exceed 0.25% (1/4 of 1%) per annum of the
[Fund's/Series'] average daily net assets represented by shares of the Class, as
a service fee pursuant to dealer or servicing agreements, the forms of which
have been approved from time to time by the Fund's Board of
[Directors/Trustees].
2. (a) The Distributor shall use the monies paid to it
pursuant to paragraph 1(a) above to assist in the distribution and
promotion of shares of the Class. Payments made to the Distributor under the
Plan may be used for, among other things, preparation and distribution of
advertisements, sales literature and prospectuses and reports used for sales
purposes, as well as compensation related to sales and marketing personnel, and
holding special promotions. In addition, such fees may be used to pay for
advancing the commission costs to dealers with respect to the sale of Class
shares.
<PAGE>
(b) The monies to be paid pursuant to paragraph 1(b) above
shall be used to pay dealers or others for, among other things, furnishing
personal services and maintaining shareholder accounts, which services include
confirming that customers have received the Prospectus and Statement of
Additional Information, if applicable; assisting such customers in maintaining
proper records with the Fund; answering questions relating to their respective
accounts; and aiding in maintaining the investment of their respective customers
in the Class.
3. The Distributor shall report to the Fund at least monthly
on the amount and the use of the monies paid to it under paragraph 1(a) above.
In addition, the Distributor and others shall inform the Fund monthly and in
writing of the amounts paid under paragraph 1(b) above; both the Distributor and
any others receiving fees under the Plan shall furnish the Board of
[Directors/Trustees] of the Fund with such other information as the Board may
reasonably request in connection with the payments made under the Plan and the
use thereof by the Distributor and others in order to enable the Board to make
an informed determination of the amount of the Fund's payments and whether the
Plan should be continued.
<PAGE>
4. The officers of the Fund shall furnish to the Board of
[Directors/Trustees] of the Fund, for their review, on a quarterly basis, a
written report of the amounts expended under the Plan and the purposes for which
such expenditures were made.
5. This Plan shall take effect at such time as the Distributor
shall notify the Fund of the commencement of the Plan (the "Commencement Date");
thereafter, the Plan shall continue in effect for a period of more than one year
from the Commencement Date only so long as such continuance is specifically
approved at least annually by a vote of the Board of [Directors/Trustees] of the
Fund, and of the [Directors/Trustees] who are not interested persons of the Fund
and have no direct or indirect financial interest in the operation of the Plan
or in any agreements related to the Plan ("non-interested
[Directors/Trustees]"), cast in person at a meeting called for the purpose of
voting on such Plan.
6. (a) The Plan may be terminated at any time by vote of a
majority of the non-interested [Directors/Trustees] or by vote of a majority of
the outstanding voting securities of the Class.
(b) The Plan may not be amended to increase materially the
amount to be spent for distribution pursuant to paragraph 1 thereof without
approval by the shareholders of the Class.
<PAGE>
7. The Distribution Agreement between the [Fund/Series] and
the Distributor, and any dealers or servicing agreements between the Distributor
and brokers or others or between the [Fund/Series] and others receiving a
servicing fee, shall specifically have a copy of this Plan attached to, and its
terms and provisions incorporated respectively by reference in, such agreements.
8. All material amendments to this Plan shall be approved by
the non-interested [Directors/Trustees] in the manner described in paragraph 5
above.
9. So long as the Plan is in effect, the selection and
nomination of the Fund's non-interested [Directors/Trustees] shall be committed
to the discretion of such non-interested [Directors/Trustees].
10. The definitions contained in Sections 2(a)(3), 2(a)(4),
2(a)(19) and 2(a)(42) of the Act shall govern the meaning of "affiliated
person," "assignment," "interested person(s)" and "vote of a majority of the
outstanding voting securities," respectively, for the purposes of this Plan.
This Plan shall take effect on the Commencement Date, as previously
defined.
<PAGE> 1
<PAGE>
[Form of Amendment to Distribution Agreement]
[FUND NAME]
[SERIES NAME, IF APPLICABLE]
AMENDMENT NO. 1 TO DISTRIBUTION AGREEMENT
This Amendment No. 1 to Distribution Agreement (this "Agreement") is
made as of the_____day of___________, 1995, by and between____________(the
"Fund"),[for the____________(the "Series"),] and DELAWARE DISTRIBUTORS, L.P.
(the "Distributor").
WITNESSETH
WHEREAS, the Fund[, for the Series,] and the Distributor are parties to
that certain Distribution Agreement made as of the 3rd day of April, 1995 (the
"Distribution Agreement"); and
WHEREAS, the Board of Directors of the Fund has established [CLASS C
SHARES NAME] (the "Class C Shares") as an additional class of [the Series]
[shares of the Fund] and the Fund and the Distributor desire to amend the
Distribution Agreement to provide that the Distributor shall act as the national
distributor of the Class C Shares pursuant thereto;
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. The Class C Shares are hereby included among the shares to which the
Distribution Agreement relates and the Distributor shall act as distributor for
the Class C Shares pursuant to and in accordance with the Distribution
Agreement, as amended hereby.
2. Hereafter, each reference to "Class A Shares and Class B Shares" in
Section 2 (c) and (d) of the Distribution Agreement [compensation of the
Distributor] shall be deemed to include the Class C Shares, provided that the
<PAGE>
Distribution Plan adopted pursuant to Rule 12b-1 under the Investment Company
Act of 1940 for the Class C Shares and presently in force is attached hereto as
Exhibit "A."
DELAWARE DISTRIBUTORS, L.P.
By: Delaware Distributors, Inc.,
General Partner
ATTEST:
By:
- ------------------------------ --------------------------------
Name: Name:
Title: Title:
[FUND NAME][,for the [SERIES NAME]]
ATTEST:
By:
- ------------------------------ ---------------------------------
Name: Name:
Title: Title:
<PAGE>
EXHIBIT A
[FORM OF 12b-1 PLAN
C CLASS SHARES]
DISTRIBUTION PLAN
The following Distribution Plan (the "Plan") has been adopted pursuant
to Rule 12b-1 under the Investment Company Act of 1940 (the "Act") by the Fund
(the "Fund"), on behalf of the Fund's C Class (the "Class"). The Plan has been
approved by a majority of the Board of Directors, including a majority of the
Directors who are not interested persons of the Fund and who have no direct or
indirect financial interest in the operation of the Plan or in any agreements
related thereto, cast in person at a meeting called for the purpose of voting on
such Plan. Such approval by the Directors included a determination that in the
exercise of reasonable business judgment and in light of their fiduciary duties,
there is a reasonable likelihood that the Plan will benefit the Fund and its
shareholders. The Plan has been approved by a vote of the holders of a majority
of the outstanding voting securities of the Class, as defined in the Act.
The Fund is a [corporation/business trust] organized under the laws of
the [State of Maryland/Commonwealth of Pennsylvania], is authorized to issue
different series and classes of securities and is an open-end management
investment company registered under the Act. [Delaware Management Company, Inc.
A-1
<PAGE>
("DMC") or Delaware International Advisers Ltd. ("Delaware International"), an
affiliate of DMC,] serves as the Fund's investment adviser and manager pursuant
to an Investment Management Agreement. Delaware Service Company, Inc. serves as
the Fund's shareholder servicing, dividend disbursing and transfer agent.
Delaware Distributors, L.P. (the "Distributor") is the principal underwriter and
national distributor for the Fund's shares, including shares of the Class,
pursuant to the Distribution Agreement between the Distributor and the Fund
("Distribution Agreement").
The Plan provides that:
1.(a) The Fund shall pay to the Distributor a monthly fee not to exceed
0.75% (3/4 of 1%) per annum of the Fund's average daily net assets represented
by shares of the Class as may be determined by the Fund's Board of Directors
from time to time.
(b) In addition to the amounts described in paragraph 1(a) above, the
Fund shall pay: (i) to the Distributor for payment to dealers or others; or (ii)
directly to others, an amount not to exceed 0.25% (1/4 of 1%) per annum of the
Fund's average daily net assets represented by shares of the Class, as a service
fee pursuant to dealer or servicing agreements.
2.(a) The Distributor shall use the monies paid to it pursuant to
paragraph 1(a) above to assist in the distribution and promotion of shares of
the Class. Payments made to the Distributor under the Plan may be used for,
among other things, preparation and distribution of advertisements, sales
literature and prospectuses and reports used for sales purposes, as well as
compensation related to sales and marketing personnel, and holding special
A-2
<PAGE>
promotions. In addition, such fees may be used to pay for advancing the
commission costs to dealers with respect to the sale of Class shares.
(b) The monies to be paid pursuant to paragraph 1(b) above shall be
used to pay dealers or others for, among other things, furnishing personal
services and maintaining shareholder accounts, which services include confirming
that customers have received the Prospectus and Statement of Additional
Information, if applicable; assisting such customers in maintaining proper
records with the Fund; answering questions relating to their respective
accounts; and aiding in maintaining the investment of their respective customers
in the Fund.
3. The Distributor shall report to the Fund at least monthly on the
amount and the use of the monies paid to it under paragraph 1(a) above. In
addition, the Distributor and others shall inform the Fund monthly and in
writing of the amounts paid under paragraph 1(b) above; both the Distributor and
any others receiving fees under the Plan shall furnish the Board of Directors of
the Fund with such other information as the Board may reasonably request in
connection with the payments made under the Plan and the use thereof by the
Distributor and others in order to enable the Board to make an informed
determination of the amount of the Fund's payments and whether the Plan should
be continued.
A-3
<PAGE>
4. The officers of the Fund shall furnish to the Board of Directors of
the Fund, and the Directors shall review, on a quarterly basis, a written report
of the amounts expended under the Plan and the purposes for which such
expenditures were made.
5. This Plan shall take effect at such time as the Distributor shall
notify the fund in writing of the commencement of the Plan (the "Commencement
Date"); thereafter, the Plan shall continue in effect for a period of more than
one year from the Commencement Date only so long as such continuance is
specifically approved at least annually by a vote of the Board of Directors of
the Fund, and of the Directors who are not interested persons of the Fund and
have no direct or indirect financial interest in the operation of the Plan or in
any agreements related to the Plan ("non-interested Directors"), cast in person
at a meeting called for the purpose of voting on such Plan.
6.(a) The Plan may be terminated at any time by vote of a majority of
the non-interested Directors or by vote of a majority of the outstanding voting
securities of the Class.
(b) The Plan may not be amended to increase materially the amount to
be spent for distribution pursuant to paragraph 1 thereof without approval by
the shareholders of the Class.
7. All material amendments to this Plan shall be approved by the
non-interested Directors in the manner described in paragraph 5 above.
A-4
<PAGE>
8. So long as the Plan is in effect, the selection and nomination of
the Fund's non-interested Directors shall be committed to the discretion of such
non-interested Directors.
9. The definitions contained in Sections 2(a)(3), 2(a)(19) and
2(a)(42) of the Act shall govern the meaning of "affiliated person,"
"interested person(s)" and "vote of a majority of the outstanding voting
securities," respectively, for the purposes of this Plan.
This Plan shall take effect on the Commencement Date, as previously
defined.
November 29, 1995
A-5
<PAGE> 1
<PAGE>
DELAWARE GROUP
Administration and Service Agreement
Gentlemen:
We are the national distributor of the shares of all of the classes
(now existing or hereafter added) of all of the Funds in the Delaware Group of
Funds. The term "Fund" as used in this Agreement refers to each fund in the
Delaware Group which retains the Distributor to promote and sell its shares, and
any fund which may hereafter be added to the Delaware Group and retain us as
national distributor. You have indicated that you wish to provide certain
services to your customers relating to their ownership of Fund shares, in
accordance with the terms of this Agreement.
TERMS
1. With respect to any Fund that offers shares of classes for which
Distribution Plans have been adopted under Rule 12b-1 (individually a "12b-1
Plan") of the Investment Company Act of 1940 (the "1940 Act"), which 12b-1 Plans
provide for the payment of service fees, we expect you to provide administrative
and other services, including, but not limited to, furnishing personal and other
services and assistance to your customers who own Fund shares, answering routine
inquiries regarding a Fund, assisting in changing dividend options, account
designations and addresses, maintaining such accounts, or such other services as
a Fund may require, to the extent permitted by applicable statutes, rules, or
regulations. For such services, we shall pay you a fee, as established by us
from time to time, based on the value of the shares of each class of each Fund
which are attributable to customers of your firm. We are permitted to make this
payment under the terms of the 12b-1 Plans adopted by certain of the Funds, as
such Plans may be in effect from time to time.
2. You shall furnish us and each Fund with such information as shall
reasonably be requested by the Board of Directors or Trustees with respect to
the fees paid to you pursuant to this Agreement.
3. We shall furnish to the Board of Directors or Trustees, for their
review, on a quarterly basis, a written report of the amounts expended under
<PAGE>
the Plan by us with respect to the relevant Fund and the purposes for which
such expenditures were made.
4. This Agreement may be terminated by either party at any time by
written notice to that effect and will terminate without notice upon any act of
insolvency by you. Notwithstanding the termination of this Agreement, you shall
remain liable for any amounts otherwise owing to the Distributor or the Funds
and for your portion of any transfer tax or other liability which may be
asserted or assessed against the Distributor or the Fund, or upon any one or
more of the Distributor's dealers, based upon a claim that you and such dealers
or any of them constitute a partnership, an unincorporated business or other
separate entity.
5. Any obligation assumed by a Fund pursuant to this Agreement shall be
limited in all cases to the assets of such Fund and no person shall seek
satisfaction thereof from shareholders of a Fund.
6. The 12b-1 Plans in effect on the date of this Agreement are
described in the Funds' Prospectuses. Each Fund reserves the right to terminate
or suspend its 12b-1 Plan(s) at any time as specified in such Plan(s) and we
reserve the right, at any time, without notice, to modify, suspend or terminate
payments hereunder in connection with such 12b-1 Plan(s).
7. This Agreement shall take effect on the date set forth below.
8. The terms and provisions of the current Prospectus and Statement of
Additional Information for each relevant Fund are hereby accepted and agreed to
by the parties hereto as evidenced by our execution hereof.
GENERAL
9. Governing Law. This Agreement will be governed by and construed in
accordance with the law of the State of Pennsylvania, without reference to that
state's choice of law doctrine.
10. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but such
counterparts shall, together, constitute only one Agreement.
11. Severability. In the event that any provision of this Agreement,
or the application of any such provision to any person or set of circumstances,
shall be determined to be invalid, unlawful, void or unenforceable to any
extent, the remainder of this Agreement, and the application of such provision
<PAGE>
to persons or circumstances other than those as to which it is determined to be
invalid, unlawful, void or unenforceable, shall not be impaired or otherwise
affected and shall continue to be valid and enforceable to the fullest extent
permitted by law.
12. Entire Agreement. This Agreement sets forth the entire
understanding of the parties hereto and supersedes all prior agreements and
understandings between the parties hereto relating to the subject matter hereof.
13. Headings. The underlined headings contained herein are for
convenience of reference only, shall not be deemed to be a part of this
Agreement and shall not be referred to in connection with the interpretation
hereof.
DELAWARE DISTRIBUTORS, L.P.
By: DELAWARE DISTRIBUTORS, INC.,
General Partner
By:
--------------------------------
Agreed and Accepted:
- ------------------------------
(Name)
By:
---------------------------
(Authorized Officer)
Date:
-------------------------
<PAGE> 1
<PAGE>
DEALER'S AGREEMENT
We invite you, as a selected dealer, to participate as principal in the
distribution of the shares of all of the classes (now existing or hereafter
added) of all of the Funds in the Delaware Group of Investment Companies which
retain us, Delaware Distributors, L.P., to act as exclusive national
distributor. The term "Fund" as used in this Agreement, refers to each Fund in
the Delaware Group which retains us to promote and sell its shares, and any Fund
which may hereafter be added to the Delaware Group and retain us as national
distributor. Such additional Funds will be included in this Agreement upon our
providing you with written notice of such inclusion.
OFFERING PRICE TO PUBLIC: Orders for shares received from you and accepted by a
Fund or its agent, Delaware Service Company, Inc., will be at the public
offering price applicable to each order as set forth in that Fund's Prospectus.
The manner of computing the net asset value of shares, the public offering price
and the effective time of orders received from you are described in the
Prospectus for each Fund. We reserve the right, at any time and without notice,
to suspend the sale of Fund shares.
CONCESSIONS TO YOU: You will be entitled to deduct the applicable concession as
set forth in the then current Prospectus of a Fund from the purchase price of
certain purchase orders placed by you for shares of a Fund having a sales
charge. We reserve the right from time to time, without prior notice, to modify,
suspend or eliminate such concessions by amendment, sticker or supplement to the
Prospectus for the Fund. If any shares confirmed to you under the terms of this
Agreement are redeemed or repurchased by the Fund or by us as agent for the
Fund, or are tendered for redemption or repurchase, within seven business days
after the date of our confirmation of the original purchase order, you shall
promptly refund to us the concession allowed to you on such shares.
PURCHASE PLANS: The purchase price on all orders placed by you and any
concessions or other fees otherwise due to you under this Agreement will be
subject to the then current terms and provisions of any applicable special plans
and accounts (e.g., volume purchases, letters of intent, rights of accumulation,
combined purchases privilege, exchange and reinvestment privileges and
<PAGE>
retirement plan accounts) as set forth from time to time in the Prospectus. We
must be notified when an order is placed if it qualifies for a reduced sales
charge under any of these plans. We reserve the right, at any time, without
prior notice, to modify, suspend or eliminate any such plans or accounts by
amendment, sticker or supplement to the Prospectus for the Fund.
SALES, ORDERS AND CONFIRMATIONS: In offering Fund shares to the public or
otherwise, you shall act as dealer for your own account, and in no transaction
shall you have any authority to act as agent for the Fund, for any other
selected dealer or for us. No person is authorized to make any representations
concerning the shares to the Fund except those contained in the Prospectus and
in written information issued by the Fund or by us as a supplement to such
Prospectus. In purchasing Fund shares, you shall rely only on such
representations.
All sales must be made subject to confirmation and orders are subject
to acceptance or rejection by the Fund in its sole discretion. Your orders must
be wired, telephoned or written to the Fund or its agent. You agree to place
orders for the same number of shares sold by you at the price at which such
shares are sold. You agree that you will not purchase Fund shares except for
investment or for the purpose of covering purchase orders already received and
that you will not, as principal, sell Fund shares unless purchased by you from
the Fund under the terms hereof. You also agree that you will not withhold
placing with us orders received from your customers so as to profit yourself
from such withholding. Each of your orders shall be confirmed by you in writing
on the same day.
PAYMENT AND ISSUANCE OF CERTIFICATES: The shares purchased by you hereunder
shall be paid for in full at the public offering price, less any concession to
you as set forth above, by check payable to the Fund, at its office, within
three business days after our acceptance of your order. If not so paid, we
reserve the right to cancel the sale and to hold you responsible for any loss
sustained by us or the Fund (including lost profit) in consequence. Certificates
representing the Fund's shares will not be issued unless (i) the Fund's
Prospectus indicates that certificates may be issued for the class of shares
being purchased, and (ii) a specific request is received from the purchaser.
Certificates, if requested, will be issued in the names indicated by
registration instructions accompanying your payment.
-2-
<PAGE>
REDEMPTION: The Prospectus describes the provisions whereby the Fund, under all
ordinary circumstances, will redeem shares held by shareholders on demand. You
agree that you will not make any representations to shareholders relating to the
redemption of their shares other than the statements contained in the Prospectus
and the underlying organizational documents of the Fund, to which it refers, and
that you will quote as the redemption price only the price determined by the
Fund. You shall not repurchase any shares from your customers at a price below
that next quoted by the Fund for redemption. You may charge a reasonable fee for
services in connection with the repurchase by you from your customers of shares.
You may hold such repurchased shares only for investment purposes or submit such
shares to the Fund for redemption.
12b-1 PLAN: With respect to any Fund that offers shares of classes for which
Distribution Plans have been adopted under Rule 12b-1 (individually a "12b-1
Plan") of the Investment Company Act of 1940 (the "1940 Act"), we expect you to
provide distribution and marketing services in the promotion of the Fund's
shares. In connection with the receipt of distribution fees and/or the receipt
of service fees as set forth under the 12b-1 Plan(s) applicable to the class or
classes of Fund shares purchased by your customers, we expect you to provide
administrative and other services to your customers who own Fund shares,
including, but not limited to, furnishing personal and other services and
assistance, answering routine inquiries regarding a Fund, assisting in changing
dividend options, account designations and addresses, maintaining such accounts,
or such other services as the Fund may require, to the extent permitted by
applicable statutes, rules, or regulations. For such services we will pay you a
fee, as established by us from time to time, based on a portion of the net asset
value of the accounts of your clients in the Fund. We are permitted to make this
payment under the terms of the 12b-1 Plans adopted by certain of the Funds, as
such Plans may be in effect from time to time. The 12b-1 Plans in effect on the
date of this Agreement are described in the Funds' Prospectuses. Each Fund
reserves the right to terminate or suspend its 12b-1 Plan at any time as
specified in the Plan and we reserve the right, at any time, without notice, to
modify, suspend or terminate payments hereunder in connection with such 12b-1
Plan. You will furnish the Fund and us with such information as may be
-3-
<PAGE>
reasonably requested by the Fund or its directors or trustees or by us with
respect to such fees paid to you pursuant to this Agreement.
LEGAL COMPLIANCE: This Agreement and any transaction with, or payment to, you
pursuant to the terms hereof is conditioned on your representation to us that,
as of the date of this Agreement you are, and at all times during its
effectiveness you will be: (a) a registered broker/dealer under the Securities
Exchange Act of 1934 and qualified under applicable state securities laws in
each jurisdiction in which you are required to be qualified to act as a
broker/dealer in securities, and a member in good standing of the National
Association of Securities Dealers, Inc. (the "NASD"); or (b) a foreign
broker/dealer not eligible for membership in the NASD and otherwise in
compliance with applicable U.S. federal and state securities laws. You agree to
notify us promptly in writing and immediately suspend sales of Fund shares if
this representation ceases to be true. You also agree that, whether you are a
member of the NASD or a foreign broker/dealer not eligible for such membership,
you will comply with the rules of the NASD including, in particular, Sections 2
and 26 of Article III thereof, and that you will maintain adequate records with
respect to your transactions with the Funds.
BLUE SKY MATTERS: We shall have no obligation or responsibility with respect to
your right to sell Fund shares in any state or jurisdiction. From time to time
we may furnish you with information identifying the states and jurisdictions
under the securities laws of which it is believed a Fund's shares may be sold.
You will not transact orders for Fund shares in states or jurisdictions in which
we indicate Fund shares may not be sold. You agree to offer and sell Fund shares
outside the United States only in compliance with all applicable laws, rules and
regulations of any foreign government having jurisdiction over such transactions
in addition to any applicable laws, rules and regulations of the United States.
LITERATURE: We will furnish you with copies of each Fund's Prospectus, sales
literature and other information made publicity available by the Fund, in
reasonable quantities upon your request. You agree to deliver a copy of the
current Prospectus in accordance with the provisions of the Securities Act of
1933 to each purchaser of Fund shares for whom you act as broker. We shall file
Fund sales literature and promotional material with the NASD and SEC as
required.
-4-
<PAGE>
You may not publish or use any sales literature or promotional materials with
respect to the Funds without our prior review and written approval.
NOTICES AND COMMUNICATIONS: All communications from you should be addressed to
us at One Commerce Square, 2005 Market Street, Philadelphia, PA 19103. Any
notice from us to you shall be deemed to have been duly given if mailed or
telegraphed to you at the address set forth below. Each of us may change the
address to which notices shall be sent by notice to the other in accordance with
the terms hereof.
TERMINATION: This Agreement may be terminated by either party at any time by
written notice to that effect and will terminate without notice upon the
appointment of a trustee for you under the Securities Investor Protection Act,
or any other act of insolvency by you. Notwithstanding the termination of this
Agreement, you shall remain liable for any amounts otherwise owing to us or the
Funds and for your portion of any transfer tax or other liability which may be
asserted or assessed against the Fund, or us, or upon any one or more of the
selected dealers based upon the claim that the selected dealers or any of them
constitute a partnership, an unincorporated business or other separate entity.
AMENDMENT: This Agreement may be amended or revised at any time by us upon
notice to you and, unless you notify us in writing to the contrary, you will be
deemed to have accepted such modifications.
GENERAL: Your acceptance hereof will constitute an obligation on your part to
observe all the terms and conditions hereof. In the event you breach any of the
terms and conditions of this Agreement, you will indemnify us, the Funds, and
our affiliates for any damages, losses, costs and expenses (including reasonable
attorneys' fees) arising out of or relating to such breach and we may offset any
such damages, losses, costs and expenses against any amounts due to you
hereunder. Nothing contained herein shall constitute you, us and any dealers an
association or partnership. All references in this Agreement to the "Prospectus"
refer to the then current version of the Prospectus and include the Statement of
Additional Information incorporated by reference therein and any stickers or
supplements thereto. This Agreement supercedes and replaces any prior agreement
-5-
<PAGE>
between us and you with respect to your purchase and sale of Fund shares and is
to be construed in accordance with the laws of the State of Delaware.
Please confirm this Agreement by executing one copy of this Agreement
below and returning it to us. Keep the enclosed duplicate copy for your records.
DELAWARE DISTRIBUTORS, L.P.
By: Delaware Distributors, Inc.,
General Partner
By:/s/Keith E. Mitchell
----------------------
Name: Keith E. Mitchell
Title: President/Chief Executive Officer
-6-
<PAGE>
DEALER'S AGREEMENT ACCEPTANCE
DELAWARE DISTRIBUTORS, L.P.
The undersigned hereby confirms the Dealer's Agreement and acknowledges
that any purchase of Fund shares made during the effectiveness of this Agreement
is subject to all the applicable terms and conditions set forth in this
Agreement, and agrees to pay for the shares at the price and upon the terms and
conditions stated in the Agreement. The undersigned hereby acknowledges receipt
of Prospectuses relating to the Fund shares and confirms that, in executing the
Dealer's Agreement, it has relied on such Prospectuses and not on any other
statement whatsoever, written or oral.
INVESTMENT DEALER PLEASE SIGN HERE AND COMPLETE BELOW
By: DATE
------------------------------- ----------------------------
Name:
-----------------------------
Title:
----------------------------
- ----------------------------------
FIRM
- ----------------------------------
FIRM'S TAX IDENTIFICATION NUMBER
- ----------------------------------
STREET ADDRESS
- ----------------------------------
CITY/STATE/ZIP
<PAGE> 1
Consent of Independent Auditors
We consent to the references to our firm under the captions "Financial
Highlights" in the Prospectus and "Financial Statements" in the Statement of
Additional Information and to the incorporation by reference in this
Post-Effective Amendment No. 54 to the Registration Statement (Form N-1A) (No.
2-28871) of Delaware Group Trend Fund, Inc. of our report dated July 28, 1995,
included in the 1995 Annual Report to Shareholders of Delaware Group Trend
Fund, Inc.
Ernst & Young LLP
Philadelphia, Pennsylvania
November 17, 1995
<PAGE> 1
[FORM OF 12b-1 PLAN FOR CLASS A SHARES]
12b-1 Plan
Class A
The following Distribution Plan (the "Plan") has been adopted pursuant
to Rule l2b-l under the Investment Company Act of l940 (the "Act") by [FUND
NAME] (the "Fund")[, now for the [SERIES NAME] (the "Series")] on behalf of the
_____________ class [now doing business as the _____________ A Class]
(hereinafter referred to as the "Class"), which Fund[, Series] and Class may do
business under these or such other names as the Board of [Directors/Trustees] of
the Fund may designate from time to time. The Plan has been approved by a
majority of the Board of [Directors/Trustees], including a majority of the
[Directors/Trustees] who are not interested persons of the Fund and who have no
direct or indirect financial interest in the operation of the Plan or in any
agreements related thereto ("non-interested [Directors/Trustees]"), cast in
person at a meeting called for the purpose of voting on such Plan. Such approval
by the [Directors/Trustees] included a determination that in the exercise of
reasonable business judgment and in light of their fiduciary duties, there is a
reasonable likelihood that the Plan will benefit the Class and its shareholders.
If the Plan has not yet been approved by a majority of the outstanding voting
securities as required in the Act, the Plan will be presented to the public
shareholders at the next regular annual or special meeting.
<PAGE>
The Fund is a [corporation/common law trust] organized under the laws
of the [State of Maryland/Commonwealth of Pennsylvania], is authorized to issue
different series and classes of securities and is an open-end management
investment company registered under the Act. [Delaware Management Company,
Inc./Delaware International Advisers Ltd.] serves as the [Fund's/Series']
investment adviser and manager pursuant to an Investment Management Agreement.
Delaware Service Company, Inc. serves as the [Fund's/Series'] shareholder
servicing, dividend disbursing and transfer agent. Delaware Distributors, L.P.
(the "Distributor") is the principal underwriter and national distributor for
the [Fund's/Series'] shares, including shares of the Class pursuant to the
Distribution Agreement between the Distributor and the [Fund/Series]
("Distribution Agreement").
The Plan provides that:
l. The Fund shall pay to the Distributor a monthly fee not to exceed
0.3% (3/10 of l%) per annum of the [Fund's/Series'] average daily net assets
represented by shares of the Class (the "Maximum Amount") as may be determined
by the Fund's Board of [Directors/Trustees] from time to time. Such monthly fee
shall be reduced by the aggregate sums paid by the Fund [on behalf of the
Series] to persons other than broker-dealers (the "Service Providers") who may,
pursuant to servicing agreements, provide to the [Fund/Series] services in the
[Fund's/Series'] marketing of shares of the Class.
2. (a) The Distributor shall use the monies paid to it pursuant to
paragraph l above to furnish, or cause or encourage others to furnish, services
and incentives in connection with the promotion, offering and sale of Class
shares and, where suitable and appropriate, the retention of Class shares by
shareholders.
(b) The Service Providers shall use the monies paid respectively to
them to reimburse themselves for the actual costs they have incurred in
confirming that their customers have received the Prospectus and Statement of
Additional Information, if applicable, and as a fee for (l) assisting such
customers in maintaining proper records with the Fund (2) answering questions
relating to their respective accounts and (3) aiding in maintaining the
investment of their respective customers in the Class.
<PAGE>
3. The Distributor shall report to the Fund at least monthly on the
amount and the use of the monies paid to it under the Plan. The Service
Providers shall inform the Fund monthly and in writing of the amounts each
claims under the Plan; both the Distributor and the Service Providers shall
furnish the Board of [Directors/Trustees] of the Fund with such other
information as the Board may reasonably request in connection with the payments
made under the Plan and the use thereof by the Distributor and the Service
Providers, respectively, in order to enable the Board to make an informed
determination of the amount of the Fund's payments and whether the Plan should
be continued.
4. The officers of the Fund shall furnish to the Board of
[Directors/Trustees] of the Fund, for their review, on a quarterly basis, a
written report of the amounts expended under the Plan and the purposes for which
such expenditures were made.
5. This Plan shall take effect at such time as the Distributor shall
notify the Fund in writing of the commencement of the Plan, which time shall not
be before the first annual or special meeting of the public shareholders at
which the Plan is or was approved by the vote of a majority of the outstanding
voting securities as required in the Act (the "Commencement Date"); thereafter,
the Plan shall continue in effect for a period of more than one year from the
Commencement Date only so long as such continuance is specifically approved at
least annually by a vote of the Board of [Directors/Trustees] of the Fund, and
of the non-interested [Directors/Trustees], cast in person at a meeting called
for the purpose of voting on such Plan.
6. (a) The Plan may be terminated at any time by vote of a majority of
the non-interested [Directors/Trustees] or by vote of a majority of the
outstanding voting securities of the Class.
(b) The Plan may not be amended to increase materially the amount to
be spent for distribution pursuant to paragraph l thereof without approval by
the shareholders of the Class.
7. All material amendments to this Plan shall be approved by the
non-interested [Directors/Trustees] in the manner described in paragraph 5
above.
<PAGE>
8. So long as the Plan is in effect, the selection and nomination of
the Fund's non-interested [Directors/Trustees] shall be committed to the
discretion of such non-interested [Directors/Trustees].
9. The definitions contained in Sections 2(a)(19) and 2(a)(42) of the
Act shall govern the meaning of "interested person(s)" and "vote of a majority
of the outstanding voting securities," respectively, for the purposes of this
Plan.
This Plan shall take effect on the Commencement Date, as previously
defined.
November 29, 1995
<PAGE> 1
[FORM OF 12b-1 PLAN FOR CLASS B SHARES]
12b-1 Plan
Class B
The following Distribution Plan (the "Plan") has been adopted pursuant
to Rule 12b-1 under the Investment Company Act of 1940 (the "Act") by [FUND
NAME] (the "Fund") [,for the [SERIES NAME] (the "Series")] on behalf of the
_______________________ B Class (the "Class"), which Fund[, Series] and Class
may do business under these or such other names as the Board of
[Directors/Trustees] of the Fund may designate from time to time. The Plan has
been approved by a majority of the Board of [Directors/Trustees], including a
majority of the [Directors/Trustees] who are not interested persons of the Fund
and who have no direct or indirect financial interest in the operation of the
Plan or in any agreements related thereto ("non-interested
[Directors/Trustees]"), cast in person at a meeting called for the purpose of
voting on such Plan. Such approval by the [Directors/Trustees] included a
determination that in the exercise of reasonable business judgment and in light
of their fiduciary duties, there is a reasonable likelihood that the Plan will
benefit the Class and its shareholders. The Plan has been approved by a vote of
the holders of a majority of the outstanding voting securities of the Class, as
defined in the Act.
The Fund is a [corporation/common law trust] organized under the laws
of the [State of Maryland/Commonwealth of Pennsylvania], is authorized to issue
different series and classes of securities and is an open-end management
investment company registered under the Act. [Delaware Management Company,
Inc./Delaware International Advisers Ltd.] serves as the [Fund's/Series']
investment adviser and manager pursuant to an Investment Management Agreement.
Delaware Service Company, Inc. serves as the [Fund's/Series'] shareholder
servicing, dividend disbursing and transfer agent. Delaware Distributors, L.P.
(the "Distributor") is the principal underwriter and national distributor for
the [Fund's/Series'] shares, including shares of the Class, pursuant to the
Distribution Agreement between the Distributor and the [Fund/Series]
("Distribution Agreement").
<PAGE>
The Plan provides that:
1. (a) The Fund shall pay to the Distributor a monthly fee not to
exceed 0.75% (3/4 of 1%) per annum of the [Fund's/Series'] average daily net
assets represented by shares of the Class as may be determined by the Fund's
Board of [Directors/Trustees] from time to time.
(b) In addition to the amounts described in (a) above, the Fund
shall pay (i) to the Distributor for payment to dealers or others, or (ii)
directly to others, an amount not to exceed 0.25% (1/4 of 1%) per annum of the
[Fund's/Series'] average daily net assets represented by shares of the Class, as
a service fee pursuant to dealer or servicing agreements.
2. (a) The Distributor shall use the monies paid to it pursuant to
paragraph 1(a) above to assist in the distribution and promotion of shares of
the Class. Payments made to the Distributor under the Plan may be used for,
among other things, preparation and distribution of advertisements, sales
literature and prospectuses and reports used for sales purposes, as well as
compensation related to sales and marketing personnel, and holding special
promotions. In addition, such fees may be used to pay for advancing the
commission costs to dealers with respect to the sale of Class shares.
(b) The monies to be paid pursuant to paragraph 1(b) above shall be
used to pay dealers or others for, among other things, furnishing personal
services and maintaining shareholder accounts, which services include confirming
that customers have received the Prospectus and Statement of Additional
Information, if applicable; assisting such customers in maintaining proper
records with the Fund; answering questions relating to their respective
accounts; and aiding in maintaining the investment of their respective customers
in the Class.
3. The Distributor shall report to the Fund at least monthly on the
amount and the use of the monies paid to it under paragraph 1(a) above. In
addition, the Distributor and others shall inform the Fund monthly and in
writing of the amounts paid under paragraph 1(b) above; both the Distributor and
any others receiving fees under the Plan shall furnish the Board of
[Directors/Trustees] of the Fund with such other information as the Board may
reasonably request in connection with the payments made under the Plan and the
use thereof by the Distributor and others in order to enable the Board to make
an informed determination of the amount of the Fund's payments and whether the
Plan should be continued.
<PAGE>
4. The officers of the Fund shall furnish to the Board of
[Directors/Trustees] of the Fund, for their review, on a quarterly basis, a
written report of the amounts expended under the Plan and the purposes for which
such expenditures were made.
5. This Plan shall take effect at such time as the Distributor shall
notify the Fund of the commencement of the Plan (the "Commencement Date");
thereafter, the Plan shall continue in effect for a period of more than one year
from the Commencement Date only so long as such continuance is specifically
approved at least annually by a vote of the Board of [Directors/Trustees] of the
Fund, and of the non-interested [Directors/Trustees], cast in person at a
meeting called for the purpose of voting on such Plan.
6.(a) The Plan may be terminated at any time by vote of a majority
of the non-interested [Directors/Trustees] or by vote of a majority of the
outstanding voting securities of the Class.
(b) The Plan may not be amended to increase materially the amount to
be spent for distribution pursuant to paragraph 1 thereof without approval by
the shareholders of the Class.
7. All material amendments to this Plan shall be approved by the
non-interested [Directors/Trustees] in the manner described in paragraph 5
above.
8. So long as the Plan is in effect, the selection and nomination of
the Fund's non-interested [Directors/Trustees] shall be committed to the
discretion of such non-interested [Directors/Trustees].
9. The definitions contained in Sections 2(a)(19) and 2(a)(42) of the
Act shall govern the meaning of "interested person(s)" and "vote of a majority
of the outstanding voting securities," respectively, for the purposes of this
Plan.
This Plan shall take effect on the Commencement Date, as previously
defined.
November 29, 1995
<PAGE> 1
<PAGE>
[FORM OF 12b-1 PLAN
C CLASS SHARES]
DISTRIBUTION PLAN
The following Distribution Plan (the "Plan") has been adopted pursuant
to Rule 12b-1 under the Investment Company Act of 1940 (the "Act") by the Fund
(the "Fund"), on behalf of the Fund's C Class (the "Class"). The Plan has been
approved by a majority of the Board of Directors, including a majority of the
Directors who are not interested persons of the Fund and who have no direct or
indirect financial interest in the operation of the Plan or in any agreements
related thereto, cast in person at a meeting called for the purpose of voting on
such Plan. Such approval by the Directors included a determination that in the
exercise of reasonable business judgment and in light of their fiduciary duties,
there is a reasonable likelihood that the Plan will benefit the Fund and its
shareholders. The Plan has been approved by a vote of the holders of a majority
of the outstanding voting securities of the Class, as defined in the Act.
The Fund is a [corporation/business trust] organized under the laws of
the [State of Maryland/Commonwealth of Pennsylvania], is authorized to issue
different series and classes of securities and is an open-end management
investment company registered under the Act. [Delaware Management Company, Inc.
("DMC") or Delaware International Advisers Ltd. ("Delaware International"), an
<PAGE>
affiliate of DMC,] serves as the Fund's investment adviser and manager pursuant
to an Investment Management Agreement. Delaware Service Company, Inc. serves as
the Fund's shareholder servicing, dividend disbursing and transfer agent.
Delaware Distributors, L.P. (the "Distributor") is the principal underwriter and
national distributor for the Fund's shares, including shares of the Class,
pursuant to the Distribution Agreement between the Distributor and the Fund
("Distribution Agreement").
The Plan provides that:
1.(a) The Fund shall pay to the Distributor a monthly fee not to exceed
0.75% (3/4 of 1%) per annum of the Fund's average daily net assets represented
by shares of the Class as may be determined by the Fund's Board of Directors
from time to time.
(b) In addition to the amounts described in paragraph 1(a) above, the
Fund shall pay: (i) to the Distributor for payment to dealers or others; or (ii)
directly to others, an amount not to exceed 0.25% (1/4 of 1%) per annum of the
Fund's average daily net assets represented by shares of the Class, as a service
fee pursuant to dealer or servicing agreements.
2.(a) The Distributor shall use the monies paid to it pursuant to
paragraph 1(a) above to assist in the distribution and promotion of shares of
the Class. Payments made to the Distributor under the Plan may be used for,
among other things, preparation and distribution of advertisements, sales
literature and prospectuses and reports used for sales purposes, as well as
compensation related to sales and marketing personnel, and holding special
<PAGE>
promotions. In addition, such fees may be used to pay for advancing the
commission costs to dealers with respect to the sale of Class shares.
(b) The monies to be paid pursuant to paragraph 1(b) above shall be
used to pay dealers or others for, among other things, furnishing personal
services and maintaining shareholder accounts, which services include confirming
that customers have received the Prospectus and Statement of Additional
Information, if applicable; assisting such customers in maintaining proper
records with the Fund; answering questions relating to their respective
accounts; and aiding in maintaining the investment of their respective customers
in the Fund.
3. The Distributor shall report to the Fund at least monthly on the
amount and the use of the monies paid to it under paragraph 1(a) above. In
addition, the Distributor and others shall inform the Fund monthly and in
writing of the amounts paid under paragraph 1(b) above; both the Distributor and
any others receiving fees under the Plan shall furnish the Board of Directors of
the Fund with such other information as the Board may reasonably request in
connection with the payments made under the Plan and the use thereof by the
Distributor and others in order to enable the Board to make an informed
determination of the amount of the Fund's payments and whether the Plan should
be continued.
4. The officers of the Fund shall furnish to the Board of Directors of
the Fund, and the Directors shall review, on a quarterly basis, a written report
of the amounts expended under the Plan and the purposes for which such
expenditures were made.
<PAGE>
5. This Plan shall take effect at such time as the Distributor shall
notify the fund in writing of the commencement of the Plan (the "Commencement
Date"); thereafter, the Plan shall continue in effect for a period of more than
one year from the Commencement Date only so long as such continuance is
specifically approved at least annually by a vote of the Board of Directors of
the Fund, and of the Directors who are not interested persons of the Fund and
have no direct or indirect financial interest in the operation of the Plan or in
any agreements related to the Plan ("non-interested Directors"), cast in person
at a meeting called for the purpose of voting on such Plan.
6.(a) The Plan may be terminated at any time by vote of a majority of
the non-interested Directors or by vote of a majority of the outstanding voting
securities of the Class.
(b) The Plan may not be amended to increase materially the amount to
be spent for distribution pursuant to paragraph 1 thereof without approval by
the shareholders of the Class.
7. All material amendments to this Plan shall be approved by the
non-interested Directors in the manner described in paragraph 5 above.
8. So long as the Plan is in effect, the selection and nomination of
the Fund's non-interested Directors shall be committed to the discretion of such
non-interested Directors.
9. The definitions contained in Sections 2(a)(3), 2(a)(19) and
2(a)(42) of the Act shall govern the meaning of "affiliated person,"
<PAGE>
"interested person(s)" and "vote of a majority of the outstanding voting
securities," respectively, for the purposes of this Plan.
This Plan shall take effect on the Commencement Date, as previously
defined.
November 29, 1995
<PAGE> 1
<PAGE>
Draft 11/8/95
SUBJECT TO BOARD APPROVAL
The Delaware Group of Funds
Multiple Class Plan Pursuant to Rule 18f-3
This Multiple Class Plan (the "Plan") has been adopted by a
majority of the Board of Directors of each of the investment companies listed on
Appendix A as may be amended from time to time (each individually a "Fund," and
collectively, the "Funds"), including a majority of the Directors who are not
interested persons of each Fund, pursuant to Rule 18f-3 under the Investment
Company Act of 1940, as amended (the "Act"). The Board of each Fund has
determined that the Plan, including the allocation of expenses, is in the best
interests of the Fund as a whole, each series of shares offered by such Fund
(individually and collectively the "Series") where the Fund offers its shares in
multiple series, and each class of shares offered by the Fund or Series, as
relevant. The Plan sets forth the provisions relating to the establishment of
multiple classes of shares for each Fund and, if relevant, its Series. To the
extent that a subject matter set forth in this Plan is covered by a Fund's
Articles of Incorporation or By-Laws, such Articles of Incorporation or By-Laws
will control in the event of any inconsistencies with descriptions contained in
this Plan.
The term "Portfolio," when used in this Plan in the context of
a Fund that offers only a single series of shares, shall be a reference to the
Fund, and when used in the context of a Fund that offers multiple series of
shares, shall be a reference to each series of such Fund.
CLASSES
1. Appendix A to this Plan describes the classes to be issued
by each Portfolio and identifies the names of such classes.
FRONT-END SALES CHARGE
2. Class A shares carry a front-end sales charge as described
in the Funds' relevant prospectuses; and Class B, Class C and Institutional
Class shares are sold without a front-end sales charge.
<PAGE>
CONTINGENT DEFERRED SALES CHARGE
3. Class A shares are not subject to a contingent deferred
sales charge ("CDSC"), except in the following limited circumstances. On
investments of $1 million or more for which a dealer's commission is paid by the
Fund's principal underwriter, a CDSC of 1.00% of the lesser of (i) the net asset
value at the time of redemption, or (ii) the original net asset value at the
time of purchase applies to redemptions of those investments within the
contingency period of 12 months from the month of purchase.
4. Class B shares redeemed within six years of their purchase
shall be assessed a CDSC at the following rate: (i) 4.00% if shares are redeemed
within two years of purchase; (ii) 3.00% if shares are redeemed during the third
or fourth year following purchase; (iii) 2.00% if shares are redeemed during the
fifth year following purchase; (iv) 1.00% if shares are redeemed during the
sixth year following purchase; and (vi) 0% thereafter.
5. Class C shares redeemed within twelve months of their
purchase shall be assessed a CDSC at the rate of 1.00% of the lesser of (i) the
net asset value at the time of redemption, or (ii) the original net asset value
at the time of purchase.
6. The CDSC for each class is waived in certain circumstances,
as described in the Funds' relevant prospectuses. Shares that are subject to a
CDSC age one month at the end of the month in which the shares were purchased,
regardless of the specific date during the month that the shares were purchased.
7. Institutional Class shares are not subject to a CDSC.
RULE 12b-1 PLANS
8. In accordance with the Rule 12b-1 Plan for the Class A
shares of each Portfolio, the Fund shall pay to Delaware Distributors, L.P. (the
"Distributor") a monthly fee not to exceed 0.30% per annum of such Portfolio's
average daily net assets represented by Class A shares as may be determined by
the Fund's Board of Directors from time to time. The monthly fee shall be
reduced by the aggregate sums paid by or on behalf of such Portfolio to persons
other than broker-dealers (the "Service Providers") pursuant to servicing
agreements.
9. In accordance with the Rule 12b-1 Plan for the Class B
shares of each Portfolio, the Fund shall pay to the Distributor a monthly fee
not to exceed 0.75% per annum of such Portfolio's average daily net assets
represented by Class B shares as may be determined by the Fund's Board of
Directors from time to time. In addition to these amounts, the Fund shall pay
(i) to the Distributor for payment to dealers or others, or (ii) directly to
others, an amount not to exceed 0.25% per annum of such Portfolio's average
daily net assets represented by Class B shares, as a service fee pursuant to
dealer or servicing agreements.
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<PAGE>
10. In accordance with the Rule 12b-1 Plan for the Class C
shares of each Portfolio, the Fund shall pay to the Distributor a monthly fee
not to exceed 0.75% per annum of such Portfolio's average daily net assets
represented by Class C shares as may be determined by the Fund's Board of
Directors from time to time. In addition to these amounts, the Fund shall pay
(i) to the Distributor for payment to dealers or others, or (ii) directly to
others, an amount not to exceed 0.25% per annum of such Portfolio's average
daily net assets represented by Class C shares, as a service fee pursuant to
dealer or servicing agreements.
11. A Rule 12b-1 Plan has not been adopted for the
Institutional Class shares of any Portfolio.
ALLOCATION OF EXPENSES
12. The Fund shall allocate to each class of shares of a
Portfolio any fees and expenses incurred by the Fund in connection with the
distribution or servicing of such class of shares under a Rule 12b-1 Plan, if
any, adopted for such class. In addition, the Fund reserves the right, subject
to approval by the Fund's Board of Directors, to allocate fees and expenses of
the following nature to a particular class of shares of a Portfolio (to the
extent that such fees and expenses actually vary among each class of shares or
vary by types of services provided to each class of shares of the Portfolio):
(i) transfer agency and other recordkeeping costs;
(ii) Securities and Exchange Commission and blue sky
registration or qualification fees;
(iii) printing and postage expenses related to printing and
distributing class specific materials, such as
shareholder reports, prospectuses and proxies to
current shareholders of a particular class or to
regulatory authorities with respect to such class of
shares;
(iv) audit or accounting fees or expenses relating
solely to such class;
(v) the expenses of administrative personnel and
services as required to support the shareholders
of such class;
-3-
<PAGE>
(vi) litigation or other legal expenses relating solely
to such class of shares;
(vii) Directors' fees and expenses incurred as a result
of issues relating solely to such class of shares;
and
(viii) other expenses subsequently identified and determined
to be properly allocated to such class
of shares.
13. Except for any expenses that are allocated to a particular
class as described in paragraph 11 above, all expenses incurred by a Portfolio
will be allocated to each class of shares of such Portfolio on the basis of the
net asset value of each such class in relation to the net asset value of the
Portfolio.
ALLOCATION OF INCOME AND GAINS
14. Income and realized and unrealized capital gains and
losses of a Portfolio will be allocated to each class of shares of such
Portfolio on the basis of the net asset value of each such class in relation to
the net asset value of the Portfolio.
CONVERSIONS
15. (a) Except for shares acquired through a reinvestment of
dividends or distributions, Class B shares held for eight years after purchase
are eligible for automatic conversion into Class A shares of the same Portfolio
in accordance with the terms described in the relevant prospectus. Class B
shares acquired through a reinvestment of dividends or distributions will
convert into Class A shares of the same Portfolio pro rata with the Class B
shares that were not acquired through the reinvestment of dividends and
distributions.
(b) The automatic conversion feature of Class B shares
shall be suspended at any time that the Board of Directors of the Fund
determines that there is not available a reasonably satisfactory opinion of
counsel to the effect that (i) the assessment of the higher fee under the Fund's
Rule 12b-1 Plan for Class B does not result in the Fund's dividends or
distributions constituting a preferential dividend under the Internal Revenue
Code of 1986, as amended, and (ii) the conversion of Class B shares into Class A
shares does not constitute a taxable event under federal income tax law. In
addition, the Board of Directors of a Fund may suspend the automatic conversion
feature by determining that any other condition to conversion set forth in the
relevant prospectus, as amended from time to time, is not satisfied.
-4-
<PAGE>
(c) The Board of Directors of a Fund may also suspend the
automatic conversion of Class B shares if it determines that suspension is
appropriate to comply with the requirements of the Act, or any rule or
regulation issued thereunder, relating to voting by Class B shareholders on the
Fund's Rule 12b-1 Plan for Class A or, in the alternative, the Board of
Directors may provide Class B shareholders with alternative conversion or
exchange rights.
16. Class A, Class C and Institutional Class shares do
not have a conversion feature.
EXCHANGES
17. Exchanges are permitted between Class A Shares and
Institutional Class Shares of a Portfolio or of any other Portfolio in the
Delaware Group funds; Class B shares of a Portfolio may only be exchanged for
Class B shares of any other Portfolio in the Delaware Group; Class C shares of a
Portfolio may only be exchanged for Class C shares of any other Portfolio in the
Delaware Group. All exchanges are subject to the eligibility and minimum
purchase requirements set forth in the Funds' prospectuses. Exchanges cannot be
made between open-end and closed-end funds within the Delaware Group.
18. Each class will vote separately with respect to the Rule
12b-1 Plan related to that class; provided, however, that Class B shares of a
Portfolio may vote on any proposal to materially increase the fees to be paid by
the Fund under the Rule 12b-1 Plan for the Class A shares of the same Portfolio.
19. On an ongoing basis, the Directors, pursuant to their
fiduciary responsibilities under the Act and otherwise, will monitor the
Portfolio for the existence of any material conflicts between the interests of
all the classes of shares offered by such Portfolio. The Directors, including a
majority of the Directors who are not interested persons of the Fund, shall take
such action as is reasonably necessary to eliminate any such conflict that may
develop. The Manager and the Distributor shall be responsible for alerting the
Board to any material conflicts that arise.
20. As described more fully in the Funds' relevant
prospectuses, broker-dealers that sell shares of a Portfolio will be compensated
differently depending on which class of shares the investor selects.
21. Each Fund reserves the right to increase, decrease or
waive the CDSC imposed on any existing or future class of shares of a Portfolio
within the ranges permissible under applicable rules and regulations of the
Securities and Exchange Commission (the "SEC") and the rules of the National
Association of Securities Dealers, Inc. (the "NASD"), as such rules may be
-5-
<PAGE>
amended or adopted from time to time. Each Fund may in the future alter the
terms of the existing classes of such Portfolio or create new classes in
compliance with applicable rules and regulations of the SEC and the NASD.
22. All material amendments to this Plan must be approved by a
majority of the Directors of each Fund affected by such amendments, including a
majority of the Directors who are not interested persons of the Fund.
Effective as of November 29, 1995
-6-
<PAGE>
APPENDIX A
List of Funds and Their Classes
1. Delaware Group Delaware Fund, Inc.
Delaware Fund
Delaware Fund A Class
Delaware Fund B Class
Delaware Fund C Class
Delaware Fund Institutional Class
Devon Fund
Devon Fund A Class
Devon Fund B Class
Devon Fund C Class
Devon Fund Institutional Class
2. Delaware Group Trend Fund, Inc.
Trend Fund A Class
Trend Fund B Class
Trend Fund C Class
Trend Fund Institutional Class
3. Delaware Group Value Fund, Inc.
Value Fund A Class
Value Fund B Class
Value Fund C Class
Value Fund Institutional Class
4. Delaware Group DelCap Fund, Inc.
DelCap Fund A Class
DelCap Fund B Class
DelCap Fund C Class
DelCap Fund Institutional Class
5. Delaware Group Decatur Fund, Inc.
Decatur Income Fund
Decatur Income Fund A Class
Decatur Income Fund B Class
Decatur Income Fund C Class
Decatur Income Fund Institutional Class
<PAGE>
Decatur Total Return Fund
Decatur Total Return Fund A Class
Decatur Total Return Fund B Class
Decatur Total Return Fund C Class
Decatur Total Return Fund Institutional Class
6. Delaware Group Global & International Funds, Inc.
International Equity Series
International Equity Fund A Class
International Equity Fund B Class
International Equity Fund C Class
International Equity Fund Institutional Class
Global Bond Series
Global Bond Fund A Class
Global Bond Fund B Class
Global Bond Fund C Class
Global Bond Fund Institutional Class
Global Assets Series
Global Assets Fund A Class
Global Assets Fund B Class
Global Assets Fund C Class
Global Assets Fund Institutional Class
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