<PAGE>
Supplement Dated April 15, 1995
to the Current Prospectuses
of the Following Delaware Group Funds
Delaware Group Delaware Fund, Inc., Delaware
Group Trend Fund, Inc., Delaware Group Value
Fund, Inc., Delaware Group Decatur Fund, Inc.,
Delaware Group DelCap Fund, Inc., Delaware
Group Delchester High-Yield Bond Fund, Inc.,
Delaware Group Government Fund, Inc.,
Delaware Group Tax-Free Fund, Inc., Delaware
Group Treasury Reserves, Inc., Delaware Group
Tax-Free Money, Inc., Delaware Group Cash
Reserve, Inc.
On March 29, 1995, shareholders of each of the above
referenced Funds or, as relevant, the series thereof, approved a new
Investment Management Agreement with Delaware Management
Company, Inc. ("DMC"), an indirect wholly-owned subsidiary of
Delaware Management Holdings, Inc. ("DMH"). The approval of
new Investment Management Agreements was subject to the
completion of the merger (the "Merger") between DMH and a wholly-
owned subsidiary of Lincoln National Corporation ("Lincoln
National") which occurred on April 3, 1995. Accordingly, the
previous Investment Management Agreements terminated and the new
Investment Management Agreements became effective on that date.
As a result of the Merger, DMC and its two affiliates,
Delaware Service Company, Inc., the Funds' shareholder servicing,
dividend disbursing and transfer agent and Delaware Distributors,
L.P., the Funds' national distributor became indirect wholly-owned
subsidiaries 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.
Under the new Investment Management Agreements, DMC
will be paid at the same annual fee rates and on the same terms as it
was under the previous Investment Management Agreements. In
addition, the investment approach and operation of each Fund and, as
relevant, each series of a Fund, will remain substantially unchanged.
PS-OTH-4/95
<PAGE>
NOVEMBER 9, 1994
DELAWARE CASH RESERVE
A CLASS
(May 30, 1994)
DELAWARE CASH RESERVE
B CLASS
(May 30, 1994)
DELAWARE CASH RESERVE
CONSULTANT CLASS
(May 30, 1994)
U.S. GOVERNMENT MONEY FUND
A CLASS
(March 25, 1994)
U.S. GOVERNMENT MONEY FUND
CONSULTANT CLASS
(March 25, 1994)
TAX-FREE MONEY FUND
A CLASS
(June 29, 1994)
TAX-FREE MONEY FUND
CONSULTANT CLASS
(June 29, 1994)
Supplement To Prospectuses As Noted Above
The following supplements the information appearing on the front cover of
the Prospectus:
Shares of this Fund are not federally insured by the Federal Deposit
Insurance Corporation, the Federal Reserve Board, or any other agency. Shares
are not deposits, obligations of, guaranteed or endorsed by any bank and
involve investment risks including possible loss of principal.
Shares of the Fund are not NCUSIF insured, are not guaranteed by the credit
union, are not obligations of the credit union, and involve investment risk,
including the possible loss of principal. Shares of the Fund are not credit
union deposits.
PS-MM
<PAGE> 1
PROSPECTUS
JUNE 29, 1994
---------------------------------------------------------------------------
TAX-FREE MONEY FUND
---------------------------------------------------------------------------
A CLASS
---------------------------------------------------------------------------
1818 Market Street
Philadelphia, PA 19103
---------------------------------------------------------------------------
For Prospectus and Performance:
Nationwide 800-523-4640
Philadelphia 988-1333
Information on Existing Accounts:
Nationwide 800-523-1918
Philadelphia 988-1241
- ----------------------------------------------------------------------------
TABLE OF CONTENTS
- ----------------------------------------------------------------------------
Cover Page 1
- ----------------------------------------------------------------------------
Synopsis 2
- ----------------------------------------------------------------------------
Summary of Expenses 3
- ----------------------------------------------------------------------------
Financial Highlights 4
- ----------------------------------------------------------------------------
Investment Objective and Policies
Suitability 5
Investment Strategy 5
- ----------------------------------------------------------------------------
The Delaware Difference
Plans and Service 7
- ----------------------------------------------------------------------------
Buying Shares 8
- ----------------------------------------------------------------------------
Redemption and Exchange 10
- ----------------------------------------------------------------------------
Dividends and Distributions 13
- ----------------------------------------------------------------------------
Taxes 13
- ----------------------------------------------------------------------------
Net Asset Value Per Share 14
- ----------------------------------------------------------------------------
Management of the Fund 14
- ----------------------------------------------------------------------------
This Prospectus describes the Tax-Free Money Fund A Class (the "Class") of
shares of Delaware Group Tax-Free Money Fund, Inc. (the "Fund"). The Fund is a
professionally-managed mutual fund of the series type, currently offering two
classes of shares of a single series. The Fund seeks a high level of current
income, exempt from federal income tax, while preserving principal and
maintaining liquidity. The Fund intends to achieve its objective by investing
its assets in a diversified portfolio of municipal money market instruments, the
interest from which is, in the opinion of bond counsel for the issuer, exempt
from federal income tax.
The Fund is a money market fund. The minimum initial investment is $1,000;
subsequent investments must be at least $25. There is no front-end or
contingent deferred sales charge.
This Prospectus sets forth information that you should read and consider
before you invest. Please retain it for future reference. Part B of the
registration statement, dated June 29, 1994, 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, Inc. at the above address or by calling the above numbers. The
Fund's financial statements appear in its Annual Report, which will accompany
any response to requests for Part B.
The Fund also offers the Tax-Free Money Fund Consultant Class of shares.
Shares of that class are offered for sale through brokers, financial
institutions and other entities which have a dealer agreement with the Fund's
Distributor or a service agreement with the Fund, and shares of that class
may be subject to 12b-1 Plan distribution expenses. At the present time, no
distribution fees are being paid under the 12b-1 Plan for the Tax-Free Money
Fund Consultant Class. A prospectus for the Tax-Free Money Fund Consultant
Class can be obtained by writing to Delaware Distributors, Inc. at the above
address or by calling the above numbers. See Tax-Free Money Fund Consultant
Class.
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.
1
<PAGE> 2
SYNOPSIS
Capitalization
The Fund offers the Tax-Free Money Fund A Class and the Tax-Free Money Fund
Consultant Class. The Fund has a present authorized capitalization of five
hundred million shares of common stock with a $.001 par value per share. One
hundred million shares of the Fund have been allocated to each class of
shares. 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., manages the other funds in the Delaware Group. Delaware Distributors,
Inc. (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.
Purchase Price
Shares of the Class offered by this Prospectus are available at net asset
value, without a sales charge and are not subject to distribution fees under
a Rule 12b-1 distribution plan. See Buying Shares.
Minimum Investment
The minimum initial investment is $1,000 and all subsequent investments
must be at least $25. See Buying Shares.
Investment Objective
The objective of the Fund is to seek a high level of current income, exempt
from federal income tax, while preserving principal and maintaining
liquidity. The Fund intends to achieve its objective by investing its assets
in a diversified portfolio of municipal money market instruments, the
interest from which is, in the opinion of bond counsel for the issuer, exempt
from federal income tax. Although exempt from regular federal income tax,
interest paid on certain types of municipal obligations is deemed to be a
preference item under federal tax law and is subject to the federal
alternative minimum tax. Up to 20% of the Fund's net assets may be invested
in bonds, the income from which is subject to the federal alternative minimum
tax. See Investment Objective and Policies.
Open-End Investment Company
The Fund, which was organized as a Maryland corporation in April 1980, is a
diversified, open-end management investment company. 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 Fund's Board of Directors. Under the
Investment Management Agreement, the annual compensation paid to the Manager
is equal to 1/2 of 1% of average daily net assets of the Fund, less all
directors' fees paid to the unaffiliated directors by the Fund. See Management
of the Fund.
Redemption and Exchange
Shares of the Fund are redeemed or exchanged at the net asset value
calculated after receipt of the redemption or exchange request. See Redemption
and Exchange.
2
<PAGE> 3
SUMMARY OF EXPENSES
<TABLE>
<CAPTION>
Annual Operating Expenses
Shareholder Transaction Expenses (as a percentage of average daily net assets)
- --------------------------------------------------------------------- ---------------------------------------------------
<S> <C> <C> <C>
Maximum Sales Charge Imposed on Purchases Management Fees.......................... 0.47%
(as a percentage of offering price).................. None 12b-1 Fees............................... None
Maximum Sales Charge Imposed on Reinvested Dividends Other Operating Expenses................. 0.52%
(as a percentage of offering price).................. None -----
Redemption Fees........................................ None* Total Operating Expenses................ 0.99%
Exchange Fees.......................................... None** =====
</TABLE>
The purpose of this table is to assist the investor in understanding the
various costs and expenses that an investor in the Class will bear directly
or indirectly. *CoreStates Bank, N.A. currently charges $7.50 per redemption
for redemptions payable by wire. **Exchanges are subject to the requirements
of each fund and a sales charge may apply. See Redemption and Exchange. Also,
see Tax-Free Money Fund Consultant Class for expense information about that
class.
The following example illustrates the expenses that you would pay on a
$1,000 investment over various time periods assuming (1) a 5% annual rate of
return and (2) redemption at the end of each time period. As noted in the
table above, the Fund charges no redemption fees.
1 year 3 years 5 years 10 years
------ ------- ------- --------
$10 $32 $55 $121
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.
3
<PAGE> 4
FINANCIAL HIGHLIGHTS
The following financial highlights are derived from the financial statements
of Delaware Group Tax-Free Money Fund and have been audited by Ernst & Young,
independent auditors. The data should be read in conjunction with the
financial statements, related notes, and the report of Ernst & Young 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, a copy of which (including
the report of Ernst & Young) may be obtained from the Fund upon request and
without charge.
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Year Ended
4/30/94 4/30/93 4/30/92 4/25/91 4/26/90 4/27/89
<S> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period(1)........................ $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000
Income From Investment
- ----------------------
Operations
- ----------
Net Investment Income.............. 0.0158 0.0201 0.0347 0.0476 0.0530 0.0503
Net Gains or Losses on Securities
(both realized and unrealized)... none none none none none none
------- ------- ------- ------- ------- -------
Total From Investment
Operations................... 0.0158 0.0201 0.0347 0.0476 0.0530 0.0503
------- ------- ------- ------- ------- -------
Less Distributions
- ------------------
Dividends (from net investment
income).......................... (0.0158) (0.0201) (0.0347) (0.0476) (0.0530) (0.0503)
Distributions (from capital gains). none none none none none none
Returns of Capital................. none none none none none none
------- ------- ------- ------- ------- -------
Total Distributions.............. (0.0158) (0.0201) (0.0347) (0.0476) (0.0530) (0.0503)
------- ------- ------- ------- ------- -------
Net Asset Value, End of Period..... $1.0000 $1.0000 $1.0000 $1.0000 $1.0000 $1.0000
======= ======= ======= ======= ======= =======
- ----------------------------------------------------------------------------------------------------------------------------------
Total Return....................... 1.59% 2.03% 3.52% 4.87% 5.43% 5.14%
- ------------
- ----------------------------------------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
- ------------------------
Net Assets, End of Period
(000 omitted).................... $44,707 $43,886 $53,210 $56,766 $61,860 $60,827
Ratio of Expenses to Average
Daily Net Assets................. 0.99% 0.94% 0.84% 0.83% 0.83% 0.79%
Ratio of Net Investment Income to
Average Daily Net Assets......... 1.58% 2.03% 3.43% 4.77% 5.30% 5.04%
</TABLE>
<PAGE> 5
<TABLE>
<CAPTION>
- ------------------------------------------------------------------------------------------------
Year Ended
4/28/88 4/30/87 4/24/86 4/25/85
<S> <C> <C> <C> <C>
Net Asset Value, Beginning of
Period(1)........................ $1.0000 $1.0000 $1.0000 $1.0000
Income From Investment
- ----------------------
Operations
- ----------
Net Investment Income.............. 0.0407 0.0390 0.0470 0.0533
Net Gains or Losses on Securities
(both realized and unrealized)... none none none none
------- ------- ------- -------
Total From Investment
Operations................... 0.0407 0.0390 0.0470 0.0533
------- ------- ------- -------
Less Distributions
- ------------------
Dividends (from net investment
income).......................... (0.0407) (0.0390) (0.0470) (0.0533)
Distributions (from capital gains). none none none none
Returns of Capital................. none none none none
------- ------- ------- -------
Total Distributions.............. (0.0407) (0.0390) (0.0470) (0.0533)
------- ------- ------- -------
Net Asset Value, End of Period..... $1.0000 $1.0000 $1.0000 $1.0000
======= ======= ======= =======
- -------------------------------------------------------------------------------------------------
Total Return....................... 4.15% 3.97% 4.80% 5.46%
- ------------
- -------------------------------------------------------------------------------------------------
Ratios/Supplemental Data
- ------------------------
Net Assets, End of Period
(000 omitted).................... $79,662 $62,782 $66,762 $52,295
Ratio of Expenses to Average
Daily Net Assets................. 0.72% 0.76% 0.79% 0.86%
Ratio of Net Investment Income to
Average Daily Net Assets......... 4.05% 3.89% 4.71% 5.32%
</TABLE>
- --------------
(1) All share and per share figures have been restated to reflect the
ten-to-one stock split on January 1, 1991.
4
<PAGE> 6
INVESTMENT OBJECTIVE
AND POLICIES
The Fund is a money market fund with the objective of seeking a high level of
current income, free from federal income tax, while preserving principal and
maintaining liquidity. The Fund seeks to do this by investing in a diversified
portfolio of municipal money market instruments, the interest from which is, in
the opinion of bond counsel for the issuer, exempt from federal income tax. The
portfolio of the Fund will be managed to maintain a constant $1.00 per share
value. While the Fund will make every effort to maintain a fixed net asset value
of $1.00 per share, there can be no assurance that this objective will be
achieved.
SUITABILITY
The Fund is suited for investors seeking current income exempt from federal
income tax. Investors should be willing to accept the risk of investments in
municipal bonds. Ownership of Fund shares also reduces the bookkeeping and
administrative inconveniences of directly purchasing money market securities.
INVESTMENT STRATEGY
The Fund seeks to attain its objective by investing at least 80% of its
assets under normal circumstances in short-term municipal money market
instruments. The Fund may invest up to 20% of its net assets in securities
the income from which is subject to the federal alternative minimum tax.
Although exempt from regular federal income tax, interest paid on certain
municipal obligations (commonly referred to as "private activity" or "private
purpose" bonds) is deemed to be a preference item under federal tax law and
is subject to the federal alternative minimum tax. While there is no
assurance its objective can be achieved, the Fund must follow certain
policies that can only be changed by shareholder approval.
Quality Restrictions
The Fund limits its investments to those which the Board of Directors has
determined present minimal credit risk and which are of high quality and
otherwise will meet the conditions with which tax-exempt money market funds
must comply.
The Fund's investments include municipal bonds, tax-free commercial paper
and short-term tax-free notes. They will also include construction loan
notes, project notes, tax anticipation notes, bond anticipation notes and
revenue anticipation notes issued by states, territories and possessions of
the United States, the District of Columbia, political subdivisions of the
above and duly constituted authorities and corporations, the interest from
which is wholly-exempt from federal income tax.
If a security or, as relevant, its issuer is considered to be rated at the
time of a proposed purchase it or, as relevant, its issuer must be so rated in
one of the two highest rating categories (e.g. for municipal bonds, AA or better
by Standard & Poor's Corporation ("S&P") or Aa or better by Moody's Investors
Service, Inc. ("Moody's"); for tax-free commercial paper and short-term
tax-free notes, A-2 or better by S&P or P-2 or better by Moody's; and for
state or municipal notes, MIG-2 or better by Moody's) by at least two
nationally-recognized statistical rating organizations (or if rated by only one
such organization, so rated by such organization) or, if the security or, as
relevant, its issuer has not been rated, to be comparable to securities that are
so rated in accordance with the conditions with which tax-exempt money market
funds must comply. The Fund may also invest in U.S. government securities (as
defined by the Investment Company Act of 1940).
Consistent with the above, the Fund may also invest in short-term municipal
obligations. "Municipal obligations" include "general obligation" and
"revenue" issues. General obligation issues are secured by the issuer's
pledge of its full faith, credit and taxing power for the payment of
principal and interest. Revenue issues are payable only from the revenues
derived from a particular facility or class of facilities.
The Fund may also invest in variable or floating rate demand obligation
instruments and other municipal securities with a maturity in excess of 13
months, but which have a demand feature whereby the Fund may tender the
instrument or security back to the issuer or another entity as described
below, consistent with the conditions with which tax-exempt money market
funds must comply. Such obligations may be backed by a Letter of Credit or
other guarantee. The Fund will consider the rating of the guarantor and the
nature of the guarantee in evaluating the quality of the obligation.
5
<PAGE> 7
Generally, a demand feature entitles the Fund to require the provider of the
demand feature to purchase the securities from the Fund at their principal
amount (usually with accrued interest) within a fixed period (generally seven
days, but the period may be longer) following a demand by the Fund. Certain
securities with a demand feature permit the Fund to tender the security only
at the time of an interest rate adjustment or at other fixed intervals. The
demand feature may be provided by the issuer of the underlying security, a
bank, a dealer in the securities or by another third party, and may not be
transferred separately from the underlying security. Certain demand features
are conditional which means that they may not be exercised or may terminate
under certain limited circumstances. The bankruptcy or receivership of, or
default by, the provider of the demand feature, or a default on the
underlying security or other event that terminates the demand feature before
its exercise will adversely affect the liquidity of the underlying security.
The Fund may not, at the time of purchase, invest more than 25% of its
assets in securities of governmental subdivisions located in any one state,
territory or U.S. possession. It may invest up to 25% of its assets in
short-term, tax-exempt project notes guaranteed by the U.S. government,
regardless of the location of the issuing municipality.
Appendix A of Part B describes Moody's and S&P's ratings.
Maturity Restrictions
The Fund maintains an average maturity of not more than 90 days. Also, it
does not purchase any instruments with an effective remaining maturity of
more than 13 months.
Investment Techniques
The Fund intends to hold its investments until maturity, but may sell them
prior to maturity for a number of reasons. These reasons include: to shorten
or lengthen the average maturity, to increase the yield, to maintain the
quality of the portfolio or to maintain a stable share value.
Up to 20% of the Fund's portfolio may be invested in issues which are not
exempt from federal income tax such as commercial paper, corporate notes,
certificates of deposit of U.S. commercial banks and domestic savings and
loan associations, obligations of the U.S. government, its agencies or
instrumentalities, certificates of deposit, when-issued securities and
repurchase agreements of the above issuers. Any such investments will meet
the conditions with which tax-exempt money market funds must comply when
purchasing such instruments.
The Fund may invest in "when-issued securities." When-issued securities
involve commitments to buy a new issue with settlement up to 45 days later.
During the time between the commitment and settlement the Fund does not
accrue interest, but the market value may fluctuate. This can result in the
Fund's share value increasing or decreasing. If the Fund invests in
securities of this type, it will maintain a segregated account to pay for
them and mark it to market daily.
The Tax Reform Act of 1986 (the "Act") limits the amount of new "private
purpose" bonds that each state can issue and subjects interest income from
these bonds to the federal alternative minimum tax. "Private purpose" bonds
are issues the proceeds of which are used to finance certain nongovernment
activities, and could include some types of industrial revenue bonds such as
privately-owned sports and convention facilities. The Act also makes the
tax-exempt status of certain bonds depend on the issuer's compliance with
specific requirements after the bonds are issued. The Fund intends to seek to
achieve a high level of tax-exempt income. However, if the Fund invests in
newly-issued private purpose bonds, a portion of its distributions would be
subject to the federal alternative minimum tax. The Fund may invest up to 20%
of its assets in bonds the income from which is subject to the federal
alternative minimum tax.
The Fund may also use repurchase agreements which are at least 100%
collateralized by securities in which the Fund can invest directly.
Repurchase agreements help the Fund to invest cash on a temporary basis.
Under a repurchase agreement, the Fund acquires ownership and possession of a
security, and the seller agrees to buy the security back at a specified time
and higher price. If the seller is unable to repurchase the security, the
Fund could experience delays and losses in liquidating the securities. To
minimize this possibility, the Fund considers the creditworthiness of banks
and dealers when entering into repurchase agreements. Earnings on repurchase
agreements are not tax-exempt.
The Fund may borrow money as a temporary measure for extraordinary purposes
or to facilitate redemptions, but it does not presently intend to do so.
6
<PAGE> 8
Asset-Backed Securities
The Fund may also invest in securities which are backed by assets such as
receivables on home equity and credit card loans, and receivables regarding
automobile, mobile home and recreational vehicle loans, wholesale dealer
floor plans and leases. All such securities must be rated in the highest
rating category by a reputable credit rating agency (e.g., AAA by S&P or Aaa
by Moody's). Such receivables are securitized in either a pass-through or a
pay-through structure. Pass-through securities provide investors with an
income stream consisting of both principal and interest payments in respect
of the receivables in the underlying pool. Pay-through asset-backed
securities are debt obligations issued usually by a special purpose entity,
which are collateralized by the various receivables and in which the payments
on the underlying receivables provide the funds to pay the debt service on
the debt obligations issued. The Fund may invest in these and other types of
asset-backed securities that may be developed in the future. It is the Fund's
current policy to limit asset-backed investments to those represented by
interests in credit card receivables, wholesale dealer floor plans, home
equity loans and automobile loans.
The rate of principal payment on asset-backed securities generally depends
upon the rate of principal payments received on the underlying assets. Such
rate of payments may be affected by economic and various other factors such
as changes in interest rates. Therefore, the yield may be difficult to
predict and actual yield to maturity may be more or less than the anticipated
yield to maturity. Such asset-backed securities involve other risks,
including the risk that security interests cannot be adequately or in many
cases, ever, established. In addition, with respect to credit card
receivables, a number of state and federal consumer credit laws give debtors
the right to set off certain amounts owed on the credit cards, thereby
reducing the outstanding balance. In the case of automobile receivables,
there is a risk that the holders may not have either a proper or first
security interest in all of the obligations backing such receivables due to
the large number of vehicles involved in a typical issuance and technical
requirements under state laws. Therefore, recoveries on repossessed
collateral may not always be available to support payments on the securities.
For further discussion concerning the risks of investing in such asset-backed
securities, see Part B.
Part B provides more information on the Fund's investment policies and
restrictions.
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 988-1333)
Fund Information
Literature
Price, Yield and Performance Figures
Shareholder Service Center
800-523-1918
(Philadelphia 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)
Performance Information
You can call the Investor Information Center anytime to get current yield
information. Yield information is updated each weekday and is based on the
annualized yield over the past seven-day or longer period.
Shareholder Services
During business hours, you can call the Fund's Shareholder Service Center.
The representatives can answer any of your questions about your account, the
Fund, the various service features and other funds in the Delaware Group.
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 seven days a week, 24 hours a
day.
7
<PAGE> 9
Account Statements
A statement of account will be mailed each quarter summarizing all
transactions during the period. However, accounts in which there has been
activity, other than regular investment programs such as Automatic Investing
or Direct Deposit Plans, will receive monthly statements reflecting
transactions for that period. You should examine statements and confirmations
immediately and promptly report any discrepancy by calling the Shareholder
Service Center.
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.
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 without a sales
charge or you may be permitted to reinvest your distributions in other funds
in the Delaware Group without a sales charge, subject to eligibility and
minimum purchase requirements set forth in each fund's prospectus. Dividends
on shares of the Class may not be invested in the Class B Shares that are
offered by certain other funds in the Delaware Group ("Class B Funds"). For
more information about reinvestments in shares of other funds in the Delaware
Group, call the Shareholder Service Center.
Exchange Privilege
The Exchange Privilege permits shareholders to exchange all or part of
their Class shares into shares of the other funds in the Delaware Group,
subject to the eligibility and minimum purchase requirements set forth in
each fund's prospectus, including any applicable front-end sales charges.
Exchanges are not permitted between Class shares and the Class B Shares of
the Class B Funds. See Redemption and Exchange.
The exchange feature is available only in states where shares of the fund
being acquired can be sold. The Fund reserves the right to suspend or
terminate, or amend the terms of, the exchange privilege upon 60 days'
written notice to shareholders. See Redemption and Exchange.
Wealth Builder Option
You may be permitted to elect to have amounts in your account automatically
invested in 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 shares. See Redemption and Exchange.
Financial Information about the Fund
Each fiscal year, you will receive an annual report containing financial
statements audited by Ernst & Young (the Fund's independent auditors), 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
April 30.
The Delaware Digest
You will receive newsletters covering topics of interest about your
investment alternatives and services from the Delaware Group.
BUYING SHARES
The Distributor serves as the national distributor for the Fund.
The minimum for initial investments is $1,000 and all subsequent
investments must be at least $25. All purchases are at net asset value. There
is no sales charge.
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 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 must be
completed, signed and sent with a check payable to Tax-Free Money Fund A
Class, to P.O. Box 7977, Philadelphia, PA 19101.
2. Subsequent Purchases--Additional purchases may be made at any time by
mailing a check payable to Tax-Free Money Fund A 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,
and should be used when you are making additional purchases. You can
expedite processing by including an investment slip with your check when
making additional purchases. Your investment may be delayed if you send
additional purchases by certified mail.
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<PAGE> 10
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, it may
delay processing your investment. In addition, you must promptly send your
Investment Application to Tax-Free Money Fund A Class, New Accounts, P.O.
Box 7977, Philadelphia, PA 19101.
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.
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
the Class. The Class B Shares of the Class B Funds may not be exchanged into
the Class. If you wish to open an account by exchange, call the Shareholder
Service Center for more information.
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 wish your employer or bank to 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 Class
account. Shareholders should allow a reasonable amount of time for initial
purchases and changes to these plans to become effective.
* * *
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.
Dividend Orders
Some shareholders want the dividends earned in one fund automatically
invested in another Delaware Group fund with a different investment
objective. For more information on the requirements of the other funds,
please call the Shareholder Service Center.
Purchase Price and Effective Date
The offering price (net asset value) of the Class is determined as of the
close of regular trading on the New York Stock Exchange (ordinarily, 4 p.m.,
Eastern time) on days when such exchange is open.
Investments by Federal Funds wire will be effective upon receipt. If the
wire is received after the time the offering price of shares is determined,
as noted above, it will be effective the next business day. If the investment
is made by check, the check must be converted to Federal Funds before your
purchase can be effective (normally one business day after receipt).
Your purchase begins earning dividends the next business day after becoming
effective. See Dividends and Distributions for additional information.
The Conditions of Your Purchase
The Fund reserves the right to reject any purchase or exchange. If a
purchase is cancelled 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, upon 60 days' written notice, to redeem accounts that
remain under $1,000 as a result of redemptions. An investor making the
minimum initial investment will be subject to involuntary redemption if he or
she redeems any portion of his or her account.
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<PAGE> 11
Tax-Free Money Fund Consultant Class
In addition to offering the Tax-Free Money Fund A Class shares, the Series
offers Tax-Free Money Fund Consultant Class shares, which are described in a
separate prospectus. The Tax-Free Money Fund Consultant Class shares are
available for sale through brokers, financial institutions and other entities
which have a dealer agreement with the Fund's Distributor or a service
agreement with the Fund. The Tax-Free Money Fund Consultant Class shares have
no front-end or contingent deferred sales charge; such class has a 12b-1 Plan
whereby the Fund is permitted to pay the Distributor annual fees payable
monthly up to a maximum of .30% of the average daily net assets of such
shares in order to compensate the Distributor for providing distribution and
related services and bearing certain distribution-related expenses. There are
no payments under the 12b-1 Plan being made at this time. However, in the
event such payments are reinstituted, sales or service compensation available
in respect of such class may differ from that available to the Tax-Free Money
Fund A Class shares. Both classes of the Series' shares have a proportionate
interest in the underlying portfolio of securities of the Series. For the
fiscal year ended April 30, 1994, the Total Operating Expenses for the
Tax-Free Money Fund Consultant Class shares were 0.99%. To obtain a
prospectus which describes the Tax-Free Money Fund Consultant Class, contact
the Distributor.
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 tax-advantaged funds, equity funds or
more aggressive bond funds. Exchanges are subject to the eligibility and
minimum purchase requirements set forth in each fund's prospectus. Any
applicable front-end sales charge will apply to exchanges from money market
funds, like the Fund, to other funds, except for exchanges from money market
funds involving assets that were previously invested in a fund with a
front-end sales charge and exchanges from a money market fund involving the
reinvestment of dividends. Class shares may not be exchanged for the Class B
Shares of the Class B Funds. Shares acquired in an exchange must be
registered in the state where they are so purchased. You may want to call us
for more information or consult your financial adviser or investment dealer
to discuss which funds in the Delaware Group will best meet your changing
objectives.
Your shares will be redeemed or exchanged out of the Class based on the net
asset value next determined after we receive your request in good order.
Redemption or exchange requests received in good order after the time the
offering price of shares is determined, as noted above, will be processed the
next business day. See Purchase Price and Effective Date under Buying Shares.
Except as otherwise noted below, for a redemption request to be in "good
order," you must provide your Class account number, account registration, and
the total number of shares or dollar amount of the transaction. Exchange
instructions and redemption requests must be signed by the record owner(s)
exactly as the shares are registered. With regard to exchanges, you must also
provide the name of the fund you want to receive the proceeds. You may
request a redemption or an exchange by calling the Fund at 800-523-1918 (in
Philadelphia, 988-1241).
The Fund will not honor check, telephone or wire redemptions for Class
shares recently purchased by check unless it is reasonably satisfied that the
purchase check has cleared, which may take up to 15 days from the purchase
date. The Fund may honor written redemption requests, but will not mail the
proceeds until it is reasonably satisfied the purchase check has cleared. You
can avoid this potential delay if you purchase shares by wiring Federal
Funds. You may call the Shareholder Service Center to determine if your funds
are available for redemption. 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.
Different redemption and exchange methods are outlined below. 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 also 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 with respect to an account,
including selection of any of the features described below, shall continue in
effect until revoked or modified in writing and until such time as such
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.
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<PAGE> 12
The Class A Shares of the Delaware Group funds that carry a front-end sales
charge will be subject to a contingent deferred sales charge ("Limited CDSC")
upon redemption if the shares were purchased at net asset value without
payment of a front-end sales charge and if a dealer's commission was paid to
a financial adviser, except in certain limited instances. Such shares may be
exchanged for shares of the Class without the imposition of the Limited CDSC
at the time of the exchange. However, upon subsequent redemption from the
Class or after a subsequent exchange into a fund that is subject to the
Limited CDSC, such shares will be subject to the Limited CDSC imposed by the
original fund whose shares were initially exchanged into the Class.
Shareholders will be given credit for the period during which the Class
shares were held.
Checkwriting Feature
Checkwriting is a convenient access feature that allows you to earn
dividends until your check is presented to the Fund.
You can request special checks by marking the box on the Investment
Application. There is a one-time $5 charge for this service.
Checks must be drawn for $500 or more and, unless otherwise indicated on
the Investment Application or your checkwriting authorization form, must be
signed by all owners of the account.
You will be subject to CoreStates Bank, N.A.'s rules and regulations
governing similar accounts. If the amount of the check is greater than the
value of the shares in your account, the check will be returned and you may
be subject to a charge.
You may request a stop payment on checks by providing the Fund with a
written authorization (oral requests will be accepted only if followed
promptly with a written authorization). Such requests will remain in effect
for six months unless renewed or cancelled. There will be a $5 charge per
check for each six-month period.
Checks paid will be returned to you semi-annually (January and July). If
you need a copy of a check prior to the regular mailing you may call the
Shareholder Service Center.
Since dividends are declared daily, you may not use the Checkwriting
Feature to close your account. (See Part B for additional information.)
Written Redemption
You can write to the Fund at 1818 Market Street, Philadelphia, PA 19103 to
redeem some or all of your Class 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.
The redemption request is effective when it is received in good order.
Payment is normally mailed the next business day, but no later than seven
days, after receipt of the request. The Fund does not issue certificates for
shares unless you submit a specific request. If your shares are in
certificate form, the certificate must accompany your request and also be in
good order.
Written Exchange
You can also write to the Fund (at 1818 Market Street, Philadelphia, PA
19103) to request an exchange of any or all of your Class shares into another
mutual fund in the Delaware Group. Written exchanges are 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 shares in certificate form, you can only
redeem or exchange by written request and you must return your certificates.
The Telephone Redemption service enabling you to have redemption proceeds
mailed to your address of record and the Telephone Exchange service, both of
which are described below, are automatically provided unless the Fund
receives written notice from the shareholder to the contrary. The Fund
reserves the right to modify, terminate or suspend these procedures upon 60
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.
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<PAGE> 13
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 Class 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, the shareholder is acknowledging prior
receipt of a prospectus for the fund into which 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 record address. Checks will be
payable to the shareholder(s) of record, and will normally be sent the next
business day, but no later 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. There are no fees for this 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 of
shares is determined, as noted above.
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 authorize an exchange of shares
into any fund in the Delaware Group under the same registration. Any such
exchange is subject to the same conditions and limitations as other exchanges
noted above. Telephone exchanges may be subject to limitations as to amounts
or frequency.
Systematic Withdrawal Plan
This plan provides shareholders with a consistent monthly (or quarterly)
payment. This is particularly useful to shareholders living on fixed incomes,
since it provides 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.
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 Class account and invested
automatically into one or more funds in the Delaware Group, subject to the
same conditions and limitations as other exchanges noted above. Shareholders
can also use the Wealth Builder Option to invest in the Class 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. See Investing by Exchange under Buying Shares. Shareholders can
terminate their participation at any time by written notice to the Fund.
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<PAGE> 14
DIVIDENDS AND DISTRIBUTIONS
The Fund declares a dividend to all Class shareholders of record at the
time the offering price of shares is determined. See Purchase Price and
Effective Date under Buying Shares. Thus, when redeeming shares, dividends
continue to accrue up to and including the date of redemption.
Purchases of Fund shares by wire begin earning dividends when converted
into Federal Funds and available for investment, normally the next business
day after receipt. However, if the Fund is given prior notice of Federal
Funds wire and an acceptable written guarantee of timely receipt from an
investor satisfying the Fund's credit policies, the purchase will start
earning dividends on the date the wire is received. Purchases by check earn
dividends upon conversion to Federal Funds, normally one business day after
receipt.
Each class of shares of the Fund will share proportionately in the
investment income and expenses of the Fund, except that the Class will not
incur any distribution fee under the Distribution Plan under Rule 12b-1 for
the Tax-Free Money Fund Consultant Class. No distribution fee under the 12b-1
Plan for the Tax-Free Money Fund Consultant Class is currently being paid.
The Fund's dividends are declared daily and paid monthly on the last day of
each month. Payment by check of cash dividends will ordinarily be mailed
within three business days after the payable date. Short-term realized
securities profits, if any, may be paid with the daily dividend; otherwise,
they will be distributed annually during the first quarter following the
close of the fiscal year.
Both dividends and distributions will be automatically reinvested in your
account unless you elect otherwise. Any check in payment of dividends or
other distributions which cannot be delivered by the 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. Information as to the tax status
of dividends will be provided annually. (See The Delaware Difference for
additional information.)
TAXES
The Fund has qualified as a regulated investment company under Subchapter M
of the Internal Revenue Code (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.
Federal Income Tax
Distributions of tax-exempt interest income are not includable in the
shareholder's gross income for federal income tax purposes. Distributions of
net investment income received by the Fund from investments in securities
other than municipal obligations, and any net short-term capital gains
realized by the Fund, will be taxable to the shareholder as ordinary income
whether received in cash or reinvested in additional shares. Distributions of
taxable net interest income, if any, will not qualify for the deduction for
dividends received by corporations. For the fiscal year 1994, all of the
Fund's net income was exempt from federal income taxes.
State and Local Taxes
The exemption of distributions for federal income tax purposes may not
result in similar exemptions under the laws of a particular state or local
taxing authority. It is recommended that shareholders consult their tax
advisers in this regard.
Shares of the Fund will be exempt from Pennsylvania county personal
property taxes. The Fund will report annually the percentage of interest
income earned on municipal obligations on a state-by-state basis during the
preceding calendar year.
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<PAGE> 15
NET ASSET VALUE PER SHARE
The purchase and redemption price of the Fund's shares is equal to the net
asset value ("NAV") per share that is next computed after the order is
received. The NAV is computed as of the close of regular trading on the New
York Stock Exchange (ordinarily, 4 p.m., Eastern time) on days when such
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.
The Fund's total net assets are determined by valuing the portfolio
securities at amortized cost. Under the direction of the Board of Directors,
certain procedures have been adopted to monitor the value of the Fund's
securities and stabilize the price per share at $1.00. Prior to January 1,
1991, the portfolio of the Fund was managed to maintain a fixed net asset
value of $10 per share. The Fund accomplished this change by effecting a
ten-to-one stock split for shareholders of record on January 1, 1991.
See Part B for additional information.
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 April 30, 1994, the Manager and its affiliate,
Delaware International Advisers Ltd., were supervising in the aggregate more
than $26 billion in various institutional (approximately $16,540,034,000) and
investment company (approximately $9,648,317,000) accounts.
The Manager is an indirect, wholly-owned subsidiary of Delaware Management
Holdings, Inc. ("DMH"). By reason of its percentage ownership of DMH common
stock and through a Voting Trust Agreement with certain other DMH
shareholders, Legend Capital Group, L.P. ("Legend") controls DMH and the
Manager. As General Partners of Legend, Leonard M. Harlan and John K. Castle
have the ability to direct the voting of more than a majority of the shares
of DMH common stock and thereby control the Manager.
The Manager manages the Fund's portfolio and makes investment decisions
which are implemented by the Fund's Trading Department. The Manager also pays
the salaries of all the directors, officers and employees of the Fund who are
affiliated with the Manager. The annual compensation paid by the Fund for
investment management services is equal to 1/2 of 1% of average daily net
assets of the Fund, less all directors' fees paid to the unaffiliated
directors by the Fund. Investment management fees paid by the Fund were 0.47%
of average daily net assets for the fiscal year ended April 30, 1994.
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<PAGE> 16
Portfolio Trading Practices
Portfolio trades are generally made on a net basis without brokerage
commissions. However, the price may include a mark-up or mark-down.
Banks, brokers or dealers are selected to execute the Fund's portfolio
transactions.
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 publish the "yield" and "effective yield"
for the Class. Both yield figures are based on historical earnings and are
not intended to indicate future performance. The "yield" of the Class refers
to the income generated by an investment in the Class over a specified
seven-day period. This income is then "annualized," which means the amount of
income generated by the investment during that week is assumed to be
generated each week over a 52-week period and is shown as a percentage of the
investment. The "effective yield" is calculated in a similar manner but, when
annualized, the income earned by an investment in the Class is assumed to be
reinvested. The "effective yield" will be slightly higher than the "yield"
because of the compounding effect of this assumed reinvestment. The Fund may
also publish aggregate and average annual total return information concerning
the Class, which will reflect the compounded rate of return of an investment
in the Class over a specified period of time and will assume the investment
of all distributions at net asset value. The Fund may also publish a
tax-equivalent yield based on federal and, if applicable, state tax rates,
which demonstrates the taxable yield necessary to produce an after-tax yield
equivalent to the Class' yield. Yield fluctuates and is not guaranteed. Past
performance is not an indication of future results.
Distribution and Service
The Distributor, Delaware Distributors, Inc., serves as the national
distributor for the Fund under a Distribution Agreement dated June 1, 1992.
It bears all of the costs of promotion and distribution.
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. Certain recordkeeping and other shareholder
services that otherwise would be performed by the Transfer Agent may be
performed by certain other entities and the Transfer Agent may elect to enter
into an agreement to pay such other entities for these services.
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 ratio of expenses to
average daily net assets of the Class for the fiscal year ended April 30,
1994 was 0.99%.
Shares
The Fund is a diversified, open-end management investment company. Commonly
known as a mutual fund, the Fund was organized as a Maryland corporation in
April 1980. The Fund's shares have a par value of $.001, equal voting rights
and are equal in all other respects.
The Fund also offers the Tax-Free Money Fund Consultant Class of shares
which represents a proportionate interest in the assets of the Fund and has
the same voting and other rights and preferences as the Class, except that
shares of the Class are not subject to, and may not vote on matters
affecting, the Distribution Plan under Rule 12b-1 relating to the Tax-Free
Money Fund Consultant Class. While the Fund's Board of Directors has
authority to create additional series and classes of shares, there is
currently only one such series, which consists of two classes of shares.
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 Investment Company Act of 1940. 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.
Prior to January 1992, the Tax-Free Money Fund A Class was known as the
original class and between January 1992 and February 1994, it was known as
the Tax-Free Money Fund class. In addition, prior to January 1992, the
Tax-Free Money Fund Consultant Class was known as the consultant class,
between January 1992 and November 1992, it was known as the Tax-Free Money
Fund (Insitutional) class and between November 1992 and February 1994, it was
known as the Tax-Free Money Fund Consultant class.
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<PAGE> 17
SHARES OF THIS FUND ARE NOT Tax-Free
FEDERALLY INSURED BY THE FEDERAL DEPOSIT Money Fund
INSURANCE CORPORATION, THE FEDERAL RESERVE ---------------
BOARD, OR ANY OTHER AGENCY. SHARES ARE NOT A Class
DEPOSITS, OBLIGATIONS OF, GUARANTEED OR
ENDORSED BY ANY BANK.
- ------------------------------------------
NO SALES CHARGE
The Delaware Group includes 20 different
funds with a wide range of investment PROSPECTUS
objectives. Stock funds, income funds,
tax-free funds, money market funds and JUNE 29, 1994
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 the Delaware Group at 800-523-4640,
in Philadelphia 215-988-1333.
Investment Manager
Delaware Management Company, Inc.
One Commerce Square
Philadelphia, PA 19103
National Distributor (Photo of George Washington)
Delaware Distributors, Inc. Crossing the Delaware River)
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 THE SHARES OF THE FUND ARE
Stradley, Ronon, Stevens & Young NEITHER INSURED NOR GUARANTEED
One Commerce Square BY THE U.S. GOVERNMENT. WHILE
Philadelphia, PA 19103 THE FUND WILL MAKE EVERY EFFORT
TO MAINTAIN A STABLE NET ASSET
Independent Auditors VALUE OF $1 PER SHARE, THERE IS
Ernst & Young NO ASSURANCE THAT THE FUND WILL
Two Commerce Square BE ABLE TO DO SO.
Philadelphia, PA 19103
Custodian
Morgan Guaranty Trust Company of New York
60 Wall Street
New York, NY 10260
DELAWARE
P-006-6/94-RRD GROUP
Printed in the U.S.A. ========
