DELAWARE GROUP VALUE FUND INC, 485APOS, 1995-09-14

DELAWARE GROUP VALUE FUND INC
485APOS, 1995-09-14

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<PAGE>

SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM N-1A

File No. 33-11419
811-4997

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [X]

Pre-Effective Amendment No. [ ]

Post-Effective Amendment No. 13 [X]

AND

REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [X]

Amendment No. 13

DELAWARE GROUP VALUE 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 13, 1995
-----------------
It is proposed that this filing will become effective:

______ immediately upon filing pursuant to paragraph (b)

______ on (date) pursuant to paragraph (b)

______ 60 days after filing pursuant to paragraph (a)(1)

___X__ on November 13, 1995 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 January 26, 1995.

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

--- C O N T E N T S ---

This Post-Effective Amendment No. 13 to Registration File No. 33-11419 includes
the following:

1. Facing Page

2. Contents Page

3. Cross-Reference Sheet

4. Part A - Prospectus and Supplement*

5. Part B - Statement of Additional Information

6. Part C - Other Information

7. Signatures

* The Value Fund Institutional Class Prospectus dated January 30, 1995 is
incorporated by reference to the electronic filing of that Prospectus made
pursuant to Rule 497(e) on April 24, 1995. The Supplement dated April 15,
1995 that was also filed on April 24, 1995 and the Supplement dated August
21, 1995 that was filed on August 18, 1995 are not incorporated by reference.
Those supplements will be superceded by this filing as of its effective date.

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.
<TABLE>
<CAPTION>
Location in
Item No. Description Prospectuses
-------- ----------- ------------
A Class/ Institutional
B Class/ Class **
C Class

CROSS-REFERENCE SHEET*
PART A

1 Cover Page............................................... Cover Cover

2 Synopsis................................................. Synopsis, Synopsis,
Summary of Summary of
Expenses Expenses

3 Condensed Financial Information.......................... Financial Financial
Highlights Highlights

4 General Description of Registrant ....................... Investment Investment
Objective and Objective
Policy, Shares and Policy,
Shares

5 Management of the Fund .................................. Management of Management
the Fund of the Fund

6 Capital Stock and Other Securities ...................... Shares, Dividends Shares,
and Distributions, Dividends
Taxes, Delaware and
Difference Distributions
Taxes

7 Purchase of Securities Being Offered..................... Buying Shares, Buying
Cover, Shares,
Management of the Cover,
Fund, Calculation Management
of Offering Price of the Fund,
and Net Asset Calculation
Value Per Share of Net Asset
Value Per
Share

</TABLE>

* This filing relates to Registrant's Value Fund A Class, Value Fund B Class
and Value Fund C Class which are combined in one prospectus, and Value Fund
Institutional Class, which has its own prospectus. The four classes have a
common Part B and Part C.

** The Value Fund Institutional Class Prospectus dated January 30, 1995 is
incorporated by reference to the electronic filing of that Prospectus made
pursuant to Rule 497(e) on April 24, 1995. The Supplement dated April 15,
1995 that was also filed on April 24, 1995 and the Supplement dated August
21, 1995 that was filed on August 18, 1995 are not incorporated by reference.
Those supplements will be superceded by this filing as of its effective date.

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

CROSS-REFERENCE SHEET*
PART A
(CONTINUED)

<TABLE>
<CAPTION>
Location in
Item No. Description Prospectuses
-------- ----------- ------------
A Class/ Institutional
B Class/ Class **
C Class
<S> <C> <C> <C>

8 Redemption or Repurchase................................. Redemption and Redemption
Exchange, and
Buying Shares Exchange,
Buying
Shares

9 Pending Legal Proceedings................................ None None

</TABLE>

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value 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 Policies and Portfolio Techniques......... Investment Policies and
Portfolio Techniques

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............... Officers and Directors,
Plan Under Rule 12b-1
for the Fund Classes (under
Purchasing Shares),
Investment Management
Agreement, General
Information, Financial
Statements

17 Brokerage Allocation and Other Practices............. 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, Redemption
and Repurchase, Determining
Offering Price and Net Asset
Value, Exchange Privilege
</TABLE>

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

CROSS REFERENCE SHEET*

PART B
(CONTINUED)
<TABLE>
<CAPTION>
Location in Statement
Item No. Description of Additional Information
-------- ----------- -------------------------
<S> <C> <C>

20 Tax Status.............................................. Accounting and Tax
Issues, Distributions
and Taxes

21 Underwriters ........................................... Purchasing Shares

22 Calculation of Performance Data......................... Performance Information

23 Financial Statements.................................... Financial Statements

PART C

Location in
Item No. Description Part 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

</TABLE>

<PAGE>
Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

CROSS REFERENCE SHEET*

PART C
(CONTINUED)

Location in
Item No. Description Part C
-------- ----------- -----------

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>

* This filing relates to Registrant's Value Fund A Class, Value Fund B
Class and Value Fund C Class which are combined in one prospectus, and
Value Fund Institutional Class, which has its own prospectus. The four
classes have a common Part B and Part C.

<PAGE>

VALUE FUND PROSPECTUS
, 1995
A CLASS SHARES
B CLASS SHARES
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 Value Fund A Class of shares (the "Class
A Shares"), the Value Fund B Class of shares (the "Class B Shares") and the
Value Fund C Class of shares (the "Class C Shares") (collectively, the
"Classes") of Delaware Group Value Fund, Inc. (the "Fund"). The Fund intends to
achieve its objective of capital appreciation by investing primarily in common
stocks whose market values appear low relative to their underlying value or
future potential.
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 5.75% 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 beneficial. 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 ,
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 November 30, 1994, and its Semi-Annual
Report for the six months ended May 31, 1995, which will accompany any response
to requests for Part B.
The Fund also offers the Value Fund Institutional Class. That class is
available for purchase only by certain institutions, has no front-end or
contingent deferred sales charge and is not subject to annual 12b-1 Plan
expenses. A prospectus for the Value 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>

TABLE OF CONTENTS

Cover Page Retirement Planning
Synopsis Buying Shares
Summary of Expenses Redemption and Exchange
Financial Highlights Dividends and Distributions
Investment Objective and Policy 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--Ratings

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>

SYNOPSIS

Capitalization
Value Fund offers four classes of shares: Class A Shares, Class B
Shares, Class C Shares and the Value Fund Institutional Class of shares. The
Fund has a present authorized capitalization of five hundred million shares of
capital stock with a $.01 par value per share. One hundred fifty million shares
of that stock have been allocated to the Class A Shares, one hundred million
shares to the Class B Shares, fifty million shares to the Class C Shares and
fifty million shares to the Value 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 5.75% 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 6.10% of the amount invested. This 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. All shares are
also 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 $250 for Class A Shares,
$1,000 for Class B Shares and $1,000 for Class C Shares. Subsequent investments
generally must be at least $25 for Class A Shares, $100 for Class B Shares and
$100 for Class C Shares. Class B Shares are subject to a maximum purchase
limitation of $250,000 and Class C Shares are subject to a maximum purchase
limitation of up to but not including $1,000,000 on each purchase of such
shares. An investor may exceed the maximum purchase limits 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 capital appreciation by investing
primarily in common stocks whose market values appear low relative to their
underlying value or future potential. For further details, see Investment
Objective and Policy.

-3-

<PAGE>

Special Considerations
The Fund may enter into options for hedging purposes to counterbalance
portfolio volatility. While the Fund does not engage in options for speculative
purposes, there are risks that result from use of these instruments by the Fund,
and the investor should review the descriptions of these risks in this
Prospectus. See Investment Strategy under Investment Objective and Policy.
The Fund may invest up to 25% of its net assets in high-yield
securities (junk bonds), and, consequently, greater risks may be involved with
an investment in the Fund. See Risk Factors under Suitability.

Open-End Investment Company
The Fund, which was organized as a Maryland corporation in 1987, 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").
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 contingent deferred sales charge if
such purchases triggered the payment of a dealer's commission. 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. When such shares are redeemed,
however, the Fund will redeem the number of shares necessary to deduct the
applicable CDSC and tender to the shareholder the requested amount if the
shareholder holds enough shares in his or her account for the redemption to be
processed in this manner. If the shareholder does not hold enough shares for the
redemption to be processed in this manner, the amount of the redemption proceeds
will be reduced by a maximum of the full amount of the 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>

(DGVF-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:

Shareholder Transaction Expenses Class A Shares Class B Shares Class C Shares
-------------------------------- -------------- -------------- --------------

<S> <C>
Maximum Sales Charge Imposed on
Purchases (as a percentage of offering
price)................................................ 5.75% 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**

Annual Operating Expenses
(as a percentage of average daily net assets) Class A Shares Class B Shares Class C Shares
--------------------------------------------- -------------- -------------- --------------

Management Fees......................................... 0.74% 0.74% 0.74%

12b-1 Expenses (including service fees)................. 0.30%+ 1.00%+ 1.00%+

Other Operating Expenses................................ 0.42% 0.42%++ 0.42%++
---- ---- ----
Total Operating Expenses................................ 1.46% 2.16% 2.16%
==== ==== ====
</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 financial advisers through whom
such purchase is effected, a contingent deferred sales charge of 1% will be
imposed on certain redemptions within 12 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; 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. +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 B Shares and Class C Shares are estimates based
on the actual expenses incurred by the Class A Shares for the fiscal year ended
November 30, 1994. See Value Fund Institutional Class under Buying Shares for
expense information for that class.

-5-

<PAGE>

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.

1 year 3 years 5 years 10 years
------ ------- ------- --------

<S> <C> <C> <C> <C>
Class A Shares $72(1) $101 $133 $222

Class B Shares $62 $ 98 $136 $232(2)

Class C Shares $32 $ 68 $116 $249

</TABLE>

An investor would pay the following expenses on the same $1,000
investment, assuming no redemption at the end of the period:

1 year 3 years 5 years 10 years
------ ------- ------- --------
<S> <C> <C> <C> <C>
Class A Shares $72 $101 $133 $222

Class B Shares $22 $ 68 $116 $232(2)

Class C Shares $22 $ 68 $116 $249
</TABLE>

(1) Generally, the Fund does not charge a redemption fee 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 12 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. See
Automatic Conversion of Class B Shares under Buying Shares for a
description of the automatic conversion feature. Information for the
ninth and tenth years reflects expenses of the Class A Shares.

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.
-------------------------------------------------------------------------------

FINANCIAL HIGHLIGHTS

The following financial highlights from June 24, 1987 through November 30, 1994
for the Class A Shares and September 6, 1994 through November 30, 1994 for the
Class B Shares are derived from the financial statements of Delaware Group Value
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. Unaudited
financial highlights for the six months ended May 31, 1995 are also provided
below for the Class A Shares and the Class B Shares. The data should be read in
conjunction with the financial statements and related notes for the six months
ended May 31, 1995, 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 November 30, 1994, and its
Semi-Annual Report to Shareholders for the six months ended May 31, 1995. A copy
of the Fund's Annual Report (including the report of Ernst & Young LLP) and its
Semi-Annual Report 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.
--------------------------------------------------------------------------------

-6-

<PAGE>

Class A Shares
--------------------------------------------------------------------
Period
12/1/94
through
5/31/95(2) Year Ended
(Unaudited) 11/30/94 11/30/93 11/30/92 11/30/91

<S> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period......................... $19.320 $20.070 $17.750 $15.320 $11.050

Income From Investment Operations
Net Investment Income........................................ 0.159 0.142 0.033 0.060 (0.006)
Net Gains or Losses on Securities
(both realized and unrealized)...................... 1.111 (0.687) 3.147 3.360 4.681
----- ------ ----- ----- -----
Total From Investment Operations......................... 1.270 (0.545) 3.180 3.420 4.675
----- ------ ----- ----- -----

Less Distributions
Dividends (from net investment income)....................... (0.160) (0.035) (0.040) none (0.155)
Distributions (from capital gains)........................... (0.250) (0.170) (0.820) (0.990) (0.250)
Returns of Capital........................................... none none none none none
------ ------ ------ ------ ------
Total Distributions...................................... (0.410) (0.205) (0.860) (0.990) (0.405)
------ ------ ------ ------ ------

Net Asset Value, End of Period............................... $20.180 $19.320 $20.070 $17.750 $15.320
======= ======= ======= ======= =======

Total Return(3).............................................. 6.74% (2.78%) 18.59% 22.99% 43.61%

---------------------------------------------------------------

Ratios/Supplemental Data

Net Assets, End of Period (000's omitted).................... $174,360 $179,498 $151,384 $38,792 $12,041
Ratio of Expenses to Average Daily Net Assets................ 1.49% 1.46% 1.64% 1.93% 2.26%
Ratio of Net Investment Income to Average Daily Net Assets... 1.58% 0.75% 0.25% 0.39% (0.07%)
Portfolio Turnover Rate...................................... 28% 14% 32% 68% 99%

</TABLE>

<PAGE>

Class A Shares
------------------------------------------------------

Period
6/24/87(1)
Year Ended through
11/30/90 11/30/89 11/30/88 11/30/87

<S> <C> <C> <C> <C>
Net Asset Value, Beginning of Period......................... $14.030 $10.440 $7.740 $9.530

Income From Investment Operations
Net Investment Income........................................ 0.149 0.131 0.054 0.058
Net Gains or Losses on Securities
(both realized and unrealized)...................... (2.269) 3.529 2.691 (1.848)
------ ----- ----- ------
Total From Investment Operations......................... (2.120) 3.660 2.745 (1.790)
------ ----- ----- ------

Less Distributions
Dividends (from net investment income)....................... (0.140) (0.070) (0.045) none
Distributions (from capital gains)........................... (0.720) none none none
Returns of Capital........................................... none none none none
------ ------ ----- ------
Total Distributions...................................... (0.860) (0.070) (0.045) none
------ ------ ------ ------

Net Asset Value, End of Period............................... $11.050 $14.030 $10.440 $7.740
======= ======= ======= ======

Total Return(3).............................................. (16.14%) 35.28%(4) 35.57%(4) (18.78%)(4)

-------------------------------------------------------------

Ratios/Supplemental Data

Net Assets, End of Period (000's omitted).................... $7,746 $11,055 $6,797 $8,780
Ratio of Expenses to Average Daily Net Assets................ 1.79% 1.98%(5) 2.02%(5) 1.50%(5)
Ratio of Net Investment Income to Average Daily Net Assets... 1.12% 1.14%(6) 0.35%(6) 1.74%(6)
Portfolio Turnover Rate...................................... 69% 103% 66% 60%

</TABLE>

----------

(1) Date of initial public offering; ratios and total return have been
annualized.
(2) Ratios have been annualized but total return has not been annualized.
(3) Does not reflect maximum front-end sales charge of 5.75% nor the 1% Limited
CDSC that would apply in the event of certain redemptions within 12 months
of purchase. See Contingent Deferred Sales Charge for Certain Purchases of
Class A Shares Made At Net Asset Value.
(4) Total return reflects the expense limitation referenced in Notes 5 and 6.
(5) Ratio of expenses to average daily net assets prior to expense limitation
was 2.16% for 1989, 2.23% for 1988 and 2.26% for 1987.
(6) Ratio of net investment income to average daily net assets prior to expense
limitation was 0.97% for 1989, 0.14% for 1988 and 0.99% for 1987.

-7-

<PAGE>

Class B Shares
--------------
Period
12/1/94 Period
through 9/6/94(1)
5/31/95(2) through
(Unaudited) 11/30/94

<S> <C> <C>
Net Asset Value, Beginning of Period......................... $19.300 $20.280

Income From Investment Operations
---------------------------------
Net Investment Income........................................ 0.139 0.011
Net Gains or Losses on Securities
(both realized and unrealized)...................... 1.071 (0.991)
----- ------
Total From Investment Operations......................... 1.210 (0.980)
----- ------

Less Distributions
------------------
Dividends (from net investment income)....................... (0.150) none
Distributions (from capital gains)........................... (0.250) none
Returns of Capital........................................... none none
Total Distributions...................................... (0.400) none
------ -------

Net Asset Value, End of Period............................... $20.110 $19.300
======= =======
----------------------------------------------------

Total Return(3).............................................. 6.43% (4.83%)
------------

----------------------------------------------------

Ratios/Supplemental Data
------------------------

Net Assets, End of Period (000's omitted).................... $3,437 $1,455
Ratio of Expenses to Average Daily Net Assets................ 2.19% 2.16%
Ratio of Net Investment Income to Average Daily Net Assets... 0.88% 0.05%
Portfolio Turnover Rate...................................... 28% 14%

</TABLE>

(1) Date of initial public offering; ratios have been annualized but total
return has not been annualized.
(2) Ratios have been annualized but total return has not been annualized.
(3) Total return does not include any applicable contingent deferred sales
charge.

-8-

<PAGE>

INVESTMENT OBJECTIVE AND POLICY

The objective of the Fund is capital appreciation. The Fund's
strategy is to invest primarily in common stocks and issues convertible into
common stocks which, in the opinion of the Manager, have market values that
appear low relative to their underlying value or future earnings and growth
potential.

Securities will be purchased that the Manager believes to be
undervalued in relation to asset value or long-term earning power of the
companies. The Manager may also invest in securities of companies where current
or anticipated favorable changes within a company provide an opportunity for
capital appreciation. The Manager's emphasis will be on securities of companies
that may be temporarily out of favor or whose value is not yet recognized by the
market.
The Manager will consider the financial strength of the company,
the nature of its management and any developments affecting the security, the
company or the industry. Securities may be out of favor due to a variety of
factors, such as lack of an institutional following, unfavorable developments
affecting the issuer of the securities, such as poor earning reports, dividend
reductions, or cyclical economic or business conditions. Other securities
considered by the Manager would include those of companies where current or
anticipated favorable changes such as a new product or service, technological
breakthrough, management change, projected takeovers, changes in capitalization
or redefinition of future corporate operations provide an opportunity for
capital appreciation. The Manager will also consider securities where trading
patterns suggest that significant positions are being accumulated by officers of
the company, outside investors or the company itself. The Manager feels it may
uncover situations where those who have a vested interest in the company feel
the securities are undervalued and have appreciation potential.
Although the Fund will constantly strive to attain the objective
of long-term growth, there can be no assurance that it will be attained. If the
Manager believes that market conditions warrant, the Fund may employ options
strategies. Also, on a temporary, defensive basis, the Manager may invest in
fixed income obligations. The objective of the Fund may not be changed without
shareholder approval.

INVESTMENT STRATEGY

While management believes that the Fund's objective may best be
attained by investing in common stocks, the Fund may also invest in other
securities including, but not limited to, convertible securities, warrants,
preferred stocks, bonds and foreign securities. Although fixed income securities
are expected to receive only minor emphasis, the Fund may invest in such
securities without regard to a minimum grade level where there are favorable
changes in a company's earnings or growth potential or where general economic
conditions and the interest rate environment provide an opportunity for
declining interest rates and consequent appreciation in these securities. See
Suitability for more specific information on such securities. The strategies
employed are dependent upon the judgment of the Manager.

In investing for capital appreciation, the Fund may hold
securities for any period of time. The degree of portfolio activity will affect
brokerage costs of the Fund and may affect taxes payable by the Fund's
shareholders. See Portfolio Trading Practices under Management of the Fund.

Should the market warrant a temporary, defensive approach, the
Fund may also invest in fixed income obligations issued or guaranteed by the
U.S. Government, its agencies or instrumentalities, as well as money market
instruments, and corporate bonds rated A or above by Moody's Investors Service,
Inc. ("Moody's") or Standard & Poor's Corporation ("S&P"). (Appendix A to this
Prospectus describes these ratings.)

-9-
<PAGE>

The Fund may write covered call options on individual issues as
well as write call options on stock indices. The Fund may also purchase put
options on individual issues and on stock indices. The Manager will employ these
techniques in an attempt to protect appreciation attained, to offset capital
losses and/or to take advantage of the liquidity available in the option
markets. The ability to hedge effectively using options on stock indices will
depend, in part, on the correlation between the composition of the index and the
Fund's portfolio as well as the price movement of individual securities. The
Fund does not currently intend to write or purchase stock index options.

While there is no limit on the amount of the Fund's assets which
may be invested in covered call options, the Fund will not invest more than 2%
of its net assets in put options. The Fund will only use Exchange-traded
options.
The Fund may invest in restricted securities, including
securities eligible for resale without registration pursuant to Rule 144A ("Rule
144A Securities") under the Securities Act of 1933. Rule 144A permits many
privately placed and legally restricted securities to be freely traded among
certain institutional buyers such as the Fund. The Fund may invest no more than
10% of the value of its net assets in illiquid securities.
While maintaining oversight, the Board of Directors has delegated
to the Manager the day-to-day functions of determining whether or not individual
Rule 144A Securities are liquid for purposes of the Fund's 10% limitation on
investments in illiquid assets. 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; (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 investment
in such securities, the Manager will determine what action shall be taken to
ensure that the Fund continues to adhere to such limitation.

Call Options
Writing Covered Call Options
A covered call option obligates the Fund to sell one of its
securities for an agreed price up to an agreed date. When the Fund writes a
call, it receives a premium and agrees to sell the callable securities to a
purchaser of a corresponding call during the call period (usually not more than
nine months) at a fixed exercise price regardless of market price changes during
the call period. The advantage is that the Fund receives premium income for the
limited purpose of offsetting the costs of purchasing put options or offsetting
any capital loss or decline in market value of the security. However, if the
Manager's forecast is wrong, the Fund may not fully participate in the market
appreciation if the security's price rises.

Writing a Call Option on Stock Indices
Writing a call option on stock indices is similar to the writing
of a call option on an individual stock. Stock indices used will include, but
not be limited to, the S&P 100 and the S&P Over-The-Counter ("OTC") 250.

Put Options
Purchasing a Put Option
A put option gives the Fund the right to sell one of its
securities for an agreed price up to an agreed date. The advantage is that the

-10-

<PAGE>

Fund can be protected should the market value of the security decline. However,
the Fund must pay a premium for this right which would be lost if the option is
not exercised.

Purchasing a Put Option on Stock Indices
Purchasing a protective put option on stock indices is similar
to the purchase of protective puts on an individual stock. Indices used will
include, but not be limited to, the S&P 100 and the S&P OTC 250.

Closing Transactions
Closing transactions essentially let the Fund offset a put option
or covered call option prior to its exercise or expiration. If the Fund cannot
effect a closing transaction, it may have to hold a security it would otherwise
sell or deliver a security it might want to hold.

Foreign Securities
The Fund may invest up to 25% 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.
The Fund will, from time to time, conduct foreign currency
exchange transactions on a spot (i.e., cash) basis at the spot rate prevailing
in the foreign currency exchange market or through entering into contracts to
purchase or sell foreign currencies at a future date (i.e., a "forward foreign
currency" contract or "forward" contract). Investors should be aware that there
are costs and risks associated with such currency transactions. The Fund may
enter into forward contracts to "lock in" the price of a security it has agreed
to purchase or sell, in terms of U.S. dollars or other currencies in which the
transaction will be consummated. When the Manager believes that the currency of
a particular foreign country may suffer a decline against the U.S. dollar or
against another currency, the Fund may enter into a forward contract to sell,
for a fixed amount of U.S. dollars or other appropriate currency, the amount of
foreign currency approximating the value of some or all of the Fund's securities
denominated in such foreign currency. It is impossible to predict precisely the
market value of portfolio securities at the expiration of the forward contract.
Accordingly, it may be necessary for the Fund to purchase or sell additional
foreign currency on the spot market (and bear the expense of such purchase or
sale) if the market value of the security is less than or greater than the
amount of foreign currency the Fund is obligated to deliver.
The Fund may incur gains or losses from currency transactions. No
type of foreign currency transaction will eliminate fluctuations in the prices
of the Fund's foreign securities or will prevent losses if the prices of such
securities should decline.
The Fund's Custodian for its foreign securities is Morgan
Guaranty Trust Company of New York, located at 60 Wall Street, New York, New
York 10260.

Repurchase Agreements

The Fund may also use repurchase agreements that are at least
100% collateralized by U.S. Government securities. Repurchase agreements help
the Fund to invest cash on a temporary basis. The Fund may invest cash balances

-11-
<PAGE>
in joint repurchase agreements with other Delaware Group funds. 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 in liquidating the securities. To minimize this possibility,
the Fund considers the creditworthiness of banks and dealers when entering into
repurchase agreements.

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 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.

* * *

The Fund is permitted under certain circumstances to borrow
money. Investment securities will not be purchased while the Fund has an
outstanding borrowing.
Part B sets forth other more specific investment restrictions.

SUITABILITY

The Fund may be suitable for investors interested in long-term
capital appreciation. Providing current income is not an objective of the Fund.
Any income produced is expected to be minimal. An investor 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.
Ownership of Fund shares reduces the bookkeeping and
administrative inconvenience that would be involved with direct purchases of the
Fund's portfolio securities.
Net asset value may fluctuate at times in response to market
conditions and, as a result, the Fund is not appropriate for a short-term
investor.

Risk Factors
The investor should be willing to accept the risks associated
with investments in domestic and international securities (and currency hedging
transactions in connection with international investing). Investing in
international securities may be speculative and subject the Fund to additional
risks. Investing in a company temporarily out of favor may involve the risk that
the anticipated favorable change may not occur and, as a result, that security
may decline in value or not appreciate as expected.
The Fund may also purchase, at times, lower rated or unrated
corporate bonds without regard to a grade minimum, which may be considered
speculative and may increase the portfolio's credit risk. Although the Fund will
ordinarily place minor emphasis on fixed income securities and will not
typically purchase bonds rated below B by Moody's or S&P (i.e., high-yield,
high-risk fixed income securities), it may do so if the Manager believes that
capital appreciation is likely. The Fund will not invest more than 25% of its
net assets in bonds rated below B. Investing in such lower rated debt securities
may involve certain risks not typically associated with higher rated securities.
Such bonds are considered very speculative and may possibly be in default or
have interest payments in arrears. See High-Yield, High-Risk Securities in Part
B for additional information on the risks associated with such securities. See
Appendix A to this Prospectus for more rating information.

-12-
<PAGE>
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, 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. 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.

Tax Information
Each year, the Fund will mail 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.

-13-

<PAGE>

Holders of Class A Shares of the Fund may not reinvest their
distributions in 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 in 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 in 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, please 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 the exceptions 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.

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, this includes certain shares owned in
other funds in the Delaware Group. See Buying Shares.

Letter of Intention
The Letter of Intention feature permits you to aggregate your
purchases of Class A Shares over a 13-month period to obtain a reduced front-end
sales charge. 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 redemption, without a
front-end sales charge. See Part B.

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
November 30.

-14-
<PAGE>
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 Value 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.

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 Plans
Permits employers to establish a tax-qualified plan based on
salary deferral contributions. Class B Shares are not available for purchase
by such plans.

Allied Plans
Class A Shares are also 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.

-15-
<PAGE>

In determining a financial adviser's eligibility for a dealer's
commission on net asset value purchases of eligible Delaware Group 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.
With respect to purchases made in connection with an Allied Plan,
the value of eligible Delaware Group and eligible non-Delaware Group fund
shares already held under the Allied Plan, may be combined with the dollar
amount of new purchases 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.
For Class A 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, apply to Allied Plans except in
the case of exchanges between eligible Delaware Group and non-Delaware Group
fund shares. When eligible Delaware Group 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.

-16-
<PAGE>

BUYING SHARES

Purchase Amounts

Generally, the minimum initial purchase is $250 for Class A
Shares, $1,000 for Class B Shares and $1,000 for Class C Shares. Subsequent
purchases generally must be $25 or more for Class A Shares and $100 or more for
Class B and C Shares. In addition, there is a maximum purchase limitation of
$250,000 on each purchase of Class B Shares and up to, but not including,
$1,000,000 on each purchase of Class C Shares. An investor wishing to exceed
these maximum purchase limitations may exceed these maximum purchase limitations
by making cumulative purchases over a period of time. 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 are (i) subject to
lower annual 12b-1 Plan expense charges 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 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") and
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 by the Fund 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 the
Class A Shares. At the end of approximately eight years after purchase, the
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 they 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 by the Fund 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 have a conversion feature.
The alternative purchase arrangements described above permit
investors in the Fund to choose the method of purchasing shares that is most
beneficial 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, purchase

-17-
<PAGE>

Class B Shares and have the entire initial purchase price 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 price 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, with respect to Class B Shares and 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 higher annual 12b-1 Plan
expenses of 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 1% for the life
of the investment. However, because front-end sales charges are deducted at the
time of purchase, investors who purchase Class A Shares would not have all their
money invested initially.
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 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 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 any 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 B to this
Prospectus for an illustration of the potential impact on a long-term
shareholder's investment in the Fund depending upon which purchase option is
chosen.
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 12b-1 PLAN AND THE CDSC 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 THE 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.

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 5.75%. See Calculation of Offering
Price and Net Asset Value Per Share.

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<PAGE>

Purchases of $100,000 or more at the offering price carry a
reduced front-end sales charge as shown in the following table.

Value 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> <C>
Less than $100,000 5.75% 6.10% 5.00%
$100,000 but under $250,000 4.75 4.99 4.00
$250,000 but under $500,000 3.50 3.63 3.00
$500,000 but under $1,000,000* 3.00 3.09 2.60
</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.

** 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 dealers up to the full 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.
--------------------------------------------------------------------------------

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<PAGE>

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:

Dealer's
Commission
----------
(as a percent-
Amount age of amount
of Purchase purchased)
------------
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

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 in the Class A
Shares with your holdings in the Class B Shares and/or the 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 21 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. This 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.

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<PAGE>

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 contingent deferred
sales charge 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.

See Investing by Exchange, for a description of net asset value purchases
for Allied Plans.

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 used 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 Delaware 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.

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

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<PAGE>

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 expenses related to distribution and other services
provided in connection with the sale of Class B Shares. This includes 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 a front-end sales charge being deducted 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
described in this Prospectus, even after the exchange. Such 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 after 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 expenses related to distribution and other services
provided in connection with the sale of Class C Shares, including 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 C Class shares as described in this Prospectus. See Redemption and
Exchange.

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<PAGE>

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 from 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 Class B Shares or Class C Shares of
the Fund, even if those shares are later exchanged for Class B Shares or Class C
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 for which the shares have been exchanged.

The following table sets forth the rates of the CDSC for the Class B
Shares of the Fund:

Contingent Deferred
Sales Charge (as a
Percentage of
Dollar Amount
Year After Purchase Made Subject to Charge)
------------------------ ------------------

0-2 4%
3-4 3%
5 2%
6 1%
7 and thereafter None

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 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 or Class C Shares, the calculation will be determined in a manner that
results in the lowest applicable rate being charged. Therefore, with respect to
the Class B Shares, it will be assumed that shares held over 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 over 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 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 .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 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 Classes exceed certain

-23-
<PAGE>

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.

[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. 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 Trend 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.

Value Fund Institutional Class
In addition to offering the Class A, Class B and Class C Shares, the Fund
also offers the Value 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 institutions. Value 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, nor a 12b-1 fee. To obtain a
prospectus which describes the Value 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 Value Fund A Class, Value Fund B Class or Value
Fund C Class at 1818 Market Street, Philadelphia, PA 19103.

2. Subsequent Purchases--Additional purchases may be made at any time by mailing
a check payable to Value Fund A Class, Value Fund B Class or Value 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

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<PAGE>

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 Value Fund A Class, Value Fund B Class or Value
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.

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 of any Class B Fund or Class C Fund. Shareholders of Class
B Shares of the Fund are permitted to exchange all or part of their Class B
Shares only into the 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 contingent deferred sales charge
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 will be added to that of the exchanged shares 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
contingent deferred sales charge by the fund from which the exchange is being
made at the time of the exchange.

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.

-25-
<PAGE>

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 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 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 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 below minimum status 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 contingent deferred sales charge will apply
to such assessments.
The Fund also reserves the right, upon 60 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 equal to 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

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<PAGE>
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. If a holder of Class B Shares or Class C Shares submits a redemption
request for a specific dollar amount, the Fund will redeem the number of shares
necessary to deduct the applicable CDSC and tender to the shareholder the
requested amount if the shareholder holds enough shares in his or her account
for the redemption to be processed in this manner. If the shareholder does not
hold enough shares for the redemption to be processed in this manner, the amount
of the redemption proceeds will be reduced by a maximum of the full amount of
the 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 or terminate, or amend the terms of, the exchange privilege
upon 60 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 the purchase check has cleared, which may take up to 15
days from the purchase date. The Fund will not honor telephone redemptions for
Class shares recently 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 time than if the investment in new Shares was made directly.
Various redemption and exchange methods are outlined below. Except for
the CDSC that applies to 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

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<PAGE>
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 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 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 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.
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

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<PAGE>

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 the 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 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 Plan for Class A and Class C Shares
1. Regular Plans
This plan provides holders of the Class A Shares and Class C Shares 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 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 with respect to
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 within the 12 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. Redemptions of Class C Shares via a Systematic Withdrawal Plan may be
subject to a CDSC if the shares redeemed were purchased within 12 months prior
to the withdrawal and the annual withdrawal amount exceeds that set forth below
under Waiver of CDSC, below.

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<PAGE>
The Systematic Withdrawal Plan is not available for Class B Shares.
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 Class account and invested automatically into one or
more funds in the Delaware Group. 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
For purchases of Class A Shares, 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 12 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
into which the Class A Shares have been exchanged.
Redemptions of such Class A Shares held for more than 12 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 into which the Class A
Shares of the Fund have been exchanged.

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
The Limited CDSC for Class A Shares 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

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<PAGE>

(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).

Waiver of CDSC
The CDSC is waived on redemptions of Class B Shares 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; (iv) distributions from an
IRA, 403(b)(7) Deferred Compensation Plan or 457 Deferred Compensation Plan due
to death or disability.
The CDSC is waived on certain redemptions of Class C Shares 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 Internal Revenue Code)
of all registered owners occurring after the purchase of the shares being
redeemed. In addition, the CDSC will be waived on Class C Shares redeemed within
12 months of purchase in accordance with a Systematic Withdrawal Plan to the
extent that the amount withdrawn during that 12-month period does not exceed 12%
of the value of the shares that were purchased on the day that the 12-month
period commenced. Each purchase of Class C Shares will be subject to its own 12%
limitation and will commence its own 12-month measuring period.

DIVIDENDS AND DISTRIBUTIONS

The Fund intends to distribute substantially all of its net capital gains
and net investment income earned during the year. Such payments, if any, will
generally be made once a year during the first quarter following the end of the
Fund's fiscal year. During the fiscal year ended November 30, 1994, a dividend
of $0.035 per Class A share was paid from net investment income and a
distribution of $0.170 per Class A share was paid from realized securities
profits. During the six months ended May 31, 1995, the Class A Shares and the
Class B Shares paid dividends of $0.160 and $0.150 per share from net investment
income, respectively, and each Class paid a capital gain of $0.250 per share
from realized securities profits. 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 and distributions
on the Class A Shares, the Class B Shares and the 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 distributions which cannot be delivered by the United

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<PAGE>

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 to be 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 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.)

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<PAGE>

TAXES

The Fund has qualified, and intends to continue to qualify, 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, 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 to the Fund's shareholders.
For the fiscal year ended November 30, 1994, 53% of the Fund's dividends from
net investment income qualified for the corporate dividends-received deduction.
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 [front-end] sales charge incurred in purchasing Fund shares will be excluded
from the federal tax basis of any of such shares sold or exchanged within ninety
(90) 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.
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 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.

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<PAGE>

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 Accounting and Tax Issues and Distributions and Taxes in Part B for
additional information on tax matters relating to the Fund and its shareholders.

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<PAGE>

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 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. Portfolio
securities for which market quotations are available are priced at market value.
Foreign securities expressed in foreign currency values will be converted into
U.S. dollar values at the mean between the currencies' bid and offered
quotations. Short-term investments having a maturity of less than 60 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 Value Fund Institutional Class will not incur
any distribution fees 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 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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<PAGE>

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 November 30, 1994, the Manager and its affiliate,
Delaware International Advisers Ltd., were supervising in the aggregate more
than $24 billion in assets in the various institutional (approximately
$15,544,258,000) and investment company (approximately $9,237,192,000) 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. As a result of the merger, DMH became a wholly-owned subsidiary and
the Manager became an indirect, wholly-owned subsidiary of Lincoln National and
both are now 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 the unaffiliated
directors. The Fund's 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 November 30, 1994 were 0.74% of average daily net assets.
Effective August 21, 1995, David C. Dalrymple assumed primary
responsibility for making day-to-day investment decisions for the Fund. Mr.
Dalrymple holds a BS in Business Administration from Clarkson College in
Potsdam, NY, and an MBA from Cornell Johnson School of Management in Ithaca, NY.
Prior to joining the Delaware Group in 1991, he spent five years as an assistant
portfolio manager for Lord Abbett and Co. in New York. Mr. Dalrymple is a
Chartered Financial Analyst and a member of the Financial Analysts of
Philadelphia.
In making investment decisions for the Fund, Mr. Dalrymple consults with
Wayne A. Stork and Richard G. Unruh, Jr. Mr. Stork, Chairman of the Board 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.
Stork joined the Delaware Group in 1962 and has served in various executive
capacities at different times within the Delaware organization. Mr. Unruh is a
graduate of Brown University and received his MBA from the University of
Pennsylvania's Wharton School. He joined the Delaware Group in 1982 after 19
years of investment management experience with Kidder, Peabody & Co. Inc. Mr.
Unruh was named an executive vice president of the Fund in 1994. He is also a
member of the Board of Directors of the Manager and was named an executive vice
president of the Manager in 1994. He is on the Board of Directors of Keystone
Insurance Company and AAA Mid-Atlantic and is a former president and current
member of the Advisory Council of the Bond Club of Philadelphia.

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

-36-
<PAGE>

affected by cash requirements for redemptions and repurchases of Fund shares.
During the past two fiscal years, the Fund's portfolio turnover rates were 32%
for 1993 and 14% for 1994.

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 the 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 securities 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
_____________, 1995.
The Fund has adopted a separate distribution plan under Rule 12b-1 for
each of the Class A Shares, the Class B Shares and the 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 and Class C Shares, 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 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 12b-1 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 by the Fund 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 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

-37-
<PAGE>

additional payments to dealers from its own resources to promote the
distribution of shares of the Classes.

The Fund's Plans do not apply to the Value 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 Value 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 the 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 November 30,
1994 was 1.46%. Based on expenses incurred by the Class A Shares during its
fiscal year ended November 30, 1994, the expenses of the Class B Shares are
expected to be 2.16% for the fiscal year ending November 30, 1995. The Fund
anticipates that the expense ratio for Class C Shares will be identical to the
expense ratio for Class B Shares. The ratio of each Class reflects the impact of
its respective 12b-1 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 January 16,
1987.
Fund shares have a par value of $.01, 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 Value Fund Institutional Class shares. 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 Value Fund Institutional Class are not subject to, and may
not vote on matters affecting, the Distribution Plans under Rule 12b-1 relating
to the Class A, Class B and Class C Shares. 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, the 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
the Class A Shares.

Prior to September 6, 1994, the Value Fund A Class was known as the Value
Fund class and the Value Fund Institutional Class was known as the Value Fund
(Institutional) class.
-38-

<PAGE>
APPENDIX A -- RATINGS

Bonds

Excerpts from Moody's description of its bond ratings: Aaa--judged to be
the best quality. They carry the smallest degree of investment risk; Aa--judged
to be of high quality by all standards; A--possess favorable attributes and are
considered "upper medium" grade obligations; Baa--considered as medium grade
obligations. Interest payments and principal security appear adequate for the
present but certain protective elements may be lacking or may be
characteristically unreliable over any great length of time; Ba--judged to have
speculative elements; their future cannot be considered as well assured. Often
the protection of interest and principal payments may be very moderate and
thereby not well safeguarded during both good and bad times over the future.
Uncertainty of position characterizes bonds in this class; B--generally lack
characteristics of the desirable investment. Assurance of interest and principal
payments or of maintenance of other terms of the contract over any long period
of time may be small; Caa--are of poor standing. Such issues may be in default
or there may be present elements of danger with respect to principal or
interest; Ca--represent obligations which are speculative in a high degree. Such
issues are often in default or have other marked shortcomings; C--the lowest
rated class of bonds and issues so rated can be regarded as having extremely
poor prospects of ever attaining any real investment standing.

Excerpts from S&P's description of its bond ratings: AAA--highest grade
obligations. They possess the ultimate degree of protection as to principal and
interest; AA--also qualify as high grade obligations, and in the majority of
instances differ from AAA issues only in a small degree; A--strong ability to
pay interest and repay principal although more susceptible to changes in
circumstances; BBB--regarded as having an adequate capacity to pay interest and
repay principal; BB, B, CCC, CC--regarded, on balance, as predominantly
speculative with respect to capacity to pay interest and repay principal in
accordance with the terms of the obligation. BB indicates the lowest degree of
speculation and CC the highest degree of speculation. While such debt will
likely have some quality and protective characteristics, these are outweighed by
large uncertainties or major risk exposures to adverse conditions; C--reserved
for income bonds on which no interest is being paid; D--in default, and
payment of interest and/or repayment of principal is in arrears.

-39-

<PAGE>

APPENDIX B
Illustrations of the Potential Impact on Investment Based on Purchase Option
Equity $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
---- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C>
0 9,425 10,000 10,000 9,425 10,000 10,000
1 10,368 10,930 10,930 10,368 10,530 10,830+
2 11,404 11,946 11,946
3 12,545 13,058 13,058
4 13,799 14,272 14,272
5 15,179 15,599 15,599
6 16,697 17,050 17,050
7 18,367 18,636 18,636
8 20,203 20,369 20,369
9 22,224 22,405*+ 22,263
10 24,446 24,646* 24,333

Scenario 3 Scenario 4
Redeem 3rd Year Redeem 5th Year
------------------------------------------------------ ----------------------------------------------
Year Class A Class B Class C Class A Class B Class C
---- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C>
0 9,425 10,000 10,000 9,425 10,000 10,000
1 10,368 10,930 10,930 10,368 10,930 10,930
2 11,404 11,946 11,946 11,404 11,946 11,946
3 12,545 12,758 13,058+ 12,545 13,058 13,058
4 13,799 14,272 14,272
5 15,179 15,399 15,599+
6
7
8
9
10
</TABLE>

*This assumes that Class B Shares convert to Class A shares at the end of the
eighth year.

<PAGE>

Equity $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
---- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C>
0 241,250 250,000 250,000 241,250 250,000 250,000
1 265,375 273,250 273,250 265,375 263,250 270,750+
2 291,913 298,662 298,662
3 321,104 326,438 326,438
4 353,214 356,797 356,797
5 388,536 389,979 389,979
6 427,389+ 426,247 426,247
7 470,128 465,888 465,888
8 517,141 509,215 509,215
9 568,855 560,137* 556,572
10 625,740 616,150* 608,333

Scenario 3 Scenario 4
Redeem 3rd Year Redeem 5th Year
------------------------------------------------------ --------------------------------------------
Year Class A Class B Class C Class A Class B Class C
---- ------- ------- ------- ------- ------- -------
<C> <C> <C> <C> <C> <C> <C>
0 241,250 250,000 250,000 241,250 250,000 250,000
1 265,375 273,250 273,250 265,375 273,250 273,250
2 291,913 298,662 298,662 291,913 298,662 298,662
3 321,104 318,938 326,438+ 321,104 326,438 326,438
4 353,214 356,797 356,797
5 388,536 384,979 389,979+
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 and a hypothetical
return for Classes B and C of 9.3% per year, due to the higher expenses of
those classes' 12b-1 Plans, except for years 9 and 10 where it is 10% for
Class B.
Class A purchase subject to appropriate sales charge breakpoint (5.75% @
$10,000; 4.75% @ $100,000; 3.50% @ $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 yields the greater return potential
based on investment amount and holding period.

-40-
<PAGE>

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

------------------------------------
VALUE FUND

------------------------------------

A CLASS

------------------------------------

B CLASS

------------------------------------

C CLASS
------------------------------------

P R O S P E C T U S

------------------------------------

, 1995

DELAWARE
GROUP
<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

The Value Fund Institutional Class Prospectus dated January 30, 1995 is
incorporated by reference into the electronic filing of that Prospectus made
pursuant to Rule 497(e) on April 24, 1995. The Supplement dated April 15, 1995
that was also filed on April 24, 1995 and the Supplement dated August 21, 1995
that was filed on August 18, 1995 are not incorporated by reference. Those
supplements will be superceded by this filing as of its effective date.

<PAGE>
_______________, 1995

DELAWARE GROUP VALUE FUND, INC.

Value Fund Institutional Class

Supplement to Prospectus dated January 30, 1995

MANAGEMENT OF THE FUND

The following supplements the investment manager information under
Management of the Fund:

On March 29, 1995, shareholders of the Delaware Group Value Fund, Inc.
(the "Fund") 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 the new Investment
Management Agreement 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 Agreement terminated and the new Investment Management
Agreement became effective on that date.

As a result of the Merger, DMC and its two affiliates, Delaware Service
Company, Inc., the Fund's shareholder servicing, dividend disbursing and
transfer agent and Delaware Distributors, L.P., the Fund's 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 Agreement, DMC will be paid at the
same annual fee rates and on the same terms as it was under the previous
Investment Management Agreement. In addition, the investment approach and
operation of the Fund will remain substantially unchanged.

The following replaces the portfolio manager information under
Management of the Fund:

Effective August 21, 1995, David C. Dalrymple assumed primary
responsibility for making day-to-day investment decisions for the Fund. Mr.
Dalrymple holds a BS in Business Administration from Clarkson College in
Potsdam, NY, and an MBA from Cornell Johnson School of Management in Ithaca, NY.
Prior to joining the Delaware Group in 1991, he spent five years as an assistant

<PAGE>

portfolio manager for Lord Abbett and Co. in New York. Mr. Dalrymple is a
Chartered Financial Analyst and a member of the Financial Analysts of
Philadelphia.

In making investment decisions for the Fund, Mr. Dalrymple consults
with Wayne A. Stork and Richard G. Unruh, Jr. Mr. Stork, Chairman of the Board
of DMC 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.
Stork joined the Delaware Group in 1962 and has served in various executive
capacities at different times within the Delaware organization. Mr. Unruh is a
graduate of Brown University and received his MBA from the University of
Pennsylvania's Wharton School. He joined the Delaware Group in 1982 and after 19
years of investment management experience with Kidder, Peabody & Co., Inc. Mr.
Unruh was named an executive vice president of the Fund in 1994. He is also a
member of the Board of Directors of DMC and was named an executive vice
president of DMC in 1994. He is on the Board of Directors of Keystone Insurance
Company and AAA Mid-Atlantic and is a former president and current member of the
Advisory Council of the Bond Club of Philadelphia.

FINANCIAL HIGHLIGHTS

The following unaudited financial highlights for the Value Fund
Institutional Class (the "Institutional Class") are derived from the unaudited
financial statements of Delaware Group Value Fund, Inc. for the six-month period
ended May 31, 1995. The data should be read in conjunction with the financial
statements and related notes which are incorporated by reference from the Fund's
Semi-Annual Report into Part B for the six months ended May 31, 1995.

-2-

Value Fund Institutional Class
-------------------------------
Six Months Ended May 31, 1995
(Unaudited)(1)

<S> <C>
Net Asset Value, Beginning of Period...................... $19.400

Income From Investment Operations
Net Investment Income..................................... 0.170
Net Gains or Losses on Securities
(both realized and unrealized)......................... 1.135
-----
Total From Investment Operations....................... 1.305
-----

Less Distributions
Dividends (from net investment income).................... (0.215)
Distributions (from capital gains)........................ (0.250)
Returns of Capital........................................ none
-----
Total Distributions.................................... (0.465)
------

Net Asset Value, End of Period............................ $20.240
=======

---------------------------------------------------------------

Total Return.............................................. 6.92%

---------------------------------------------------------------

Ratios/Supplemental Data

Net Assets, End of Period (000's omitted)................. $7,364
Ratio of Expenses to Average Daily Net Assets............. 1.19%
Ratio of Net Investment Income to Average Daily Net Assets 1.88%
Portfolio Turnover Rate................................... 28%

</TABLE>

----------
(1) Ratios have been annualized but total return has not been annualized.

ADDITIONAL CLASSES

In addition to the Institutional Class, the Fund offers the Value Fund A
Class, the Value Fund B Class and the Value 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).

-3-

<PAGE>

------------------------------------------------------------------------------
PART B--STATEMENT OF ADDITIONAL INFORMATION
, 1995
------------------------------------------------------------------------------

DELAWARE GROUP VALUE FUND, INC.
-------------------------------------------------------------------------------
1818 Market Street
Philadelphia, PA 19103
-------------------------------------------------------------------------------

For more information about the
Value Fund Institutional Class:
800-828-5052
For Prospectus and Performance
of the Value Fund A Class,
the Value Fund B Class and
the Value Fund C Class:
Nationwide 800-523-4640
Philadelphia 215-988-1333
Information on Existing Accounts
of the Value Fund A Class,
the Value Fund B Class and the
Value 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 Policies and Portfolio Techniques
------------------------------------------------------------------------------

Accounting and Tax Issues
------------------------------------------------------------------------------

Performance Information
------------------------------------------------------------------------------

Trading Practices and Brokerage
------------------------------------------------------------------------------

Purchasing Shares
------------------------------------------------------------------------------

Investment Plans
------------------------------------------------------------------------------

Determining Offering Price and Net Asset Value
------------------------------------------------------------------------------

Redemption and Repurchase
------------------------------------------------------------------------------

Distributions and Taxes
------------------------------------------------------------------------------

Investment Management Agreement
------------------------------------------------------------------------------

Officers and Directors
------------------------------------------------------------------------------

Exchange Privilege
------------------------------------------------------------------------------

General Information
------------------------------------------------------------------------------

Appendix A -- Description of Ratings
------------------------------------------------------------------------------

Appendix B -- IRA Information
------------------------------------------------------------------------------

Appendix C
------------------------------------------------------------------------------

Financial Statements
------------------------------------------------------------------------------

<PAGE>

Delaware Group Value Fund, Inc. (the "Fund") is a
professionally-managed mutual fund of the series type which currently offers a
single portfolio. The Fund offers four classes (individually, a "Class" and
collectively, the "Classes") of shares - Value Fund A Class (the "Class A
Shares"), Value Fund B Class (the "Class B Shares") and Value Fund C Class (the
"Class C Shares") (together, the "Fund Classes") and Value Fund Institutional
Class (the "Institutional Class"). Class B Shares, Class C Shares and
Institutional Class shares of the Fund 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 5.75% 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%, 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 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 __________, 1995 and the current
Prospectus for the Institutional Class dated ___________, 1995 and the
supplement thereto dated _____________, 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.

<PAGE>

INVESTMENT POLICIES AND PORTFOLIO TECHNIQUES

Investment Restrictions--The Fund has adopted the following
restrictions which, along with its investment objective, cannot be changed
without approval by the holders of a "majority" of the Fund's outstanding
shares, which is a vote by the holders of 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.
The Fund shall not:

1. Invest more than 5% of the market or other fair value of its assets
in the securities of any one issuer (other than obligations of, or guaranteed
by, the U.S. Government, its agencies or instrumentalities).

2. Invest in securities of other investment companies except as part of
a merger, consolidation or other acquisition.
3. Make loans, except to the extent that purchases of debt obligations
(including repurchase agreements), in accordance with the Fund's investment
objective and policies, are considered loans and except that 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.
4. Purchase or sell real estate but this shall not prevent the Fund
from investing in securities secured by real estate or interests therein.
5. Purchase more than 10% of the outstanding voting and nonvoting
securities of any issuer, or invest in companies for the purpose of exercising
control or management.
6. Engage in the underwriting of securities of other issuers, except
that in connection with the disposition of a security, the Fund may be deemed to
be an "underwriter" as that term is defined in the Securities Act of 1933.

7. Make any investment which would cause more than 25% of the market or
other fair value of its total assets to be invested in the securities of issuers
all of which conduct their principal business activities in the same industry.
This restriction does not apply to obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.

8. Write or purchase puts, calls or combinations thereof, except that
the Fund may write covered call options with respect to any or all parts of its
portfolio securities and purchase put options if the Fund owns the security
covered by the put option at the time of purchase, and that premiums paid on all
put options outstanding do not exceed 2% of its total assets. The Fund may sell
put options previously purchased and enter into closing transactions with
respect to covered call and put options. In addition, the Fund may write call
options and purchase put options on stock indices and enter into closing
transactions with respect to such options.
9. Purchase securities on margin, make short sales of securities or
maintain a net short position.
10. 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.
11. Invest in warrants valued at lower of cost or market exceeding 5%
of the Fund's net assets. Included in 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.
12. Purchase or retain the securities of any issuer which has an
officer, director or security holder who is a director or officer of the Fund or
of its investment manager if or so long as the directors and officers of the
Fund and of its investment manager together own beneficially more than 5% of any
class of securities of such issuer.

<PAGE>

13. Invest in interests in oil, gas or other mineral exploration or
development programs.
14. Invest more than 10% of the Fund's net assets in repurchase
agreements maturing in more than seven days and other illiquid assets.
15. Borrow money in excess of one-third of the value of its net assets
and then only as a temporary measure for extraordinary purposes or to facilitate
redemptions. The Fund has no intention of increasing its net income through
borrowing. Any borrowing will be done from a bank and to the extent that such
borrowing exceeds 5% of the value of the Fund's net 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 or holidays) or such longer period as the Securities and Exchange
Commission may prescribe by rules and regulations, reduce the amount of its
borrowings to such an extent that the asset coverage of such borrowings shall be
at least 300%. The Fund will not pledge more than 10% of its net assets. The
Fund will not issue senior securities as defined in the Investment Company Act
of 1940, except for notes to banks. Investment securities will not normally be
purchased while the Fund has an outstanding borrowing.
Although it is not a matter of fundamental policy, the Fund has also
made a commitment that it will not invest in commodities. However, the Fund
reserves the right to invest in financial futures and options thereon, including
stock index futures, to the extent these instruments are considered commodities.
In addition, although not a fundamental investment restriction, the Fund
currently does not invest its assets in real estate limited partnerships.
Investment Policies--The application of the Fund's investment policy
will be dependent upon the judgment of Delaware Management Company, Inc. (the
"Manager"). In accordance with the judgment of the Manager, the proportions of
the Fund's assets invested in particular industries will vary from time to time.
The securities in which the Fund invests may or may not be listed on a national
stock exchange, but if they are not so listed will generally have an established
over-the-counter market. While management believes that the investment objective
can be achieved by investing in common stock, the portfolio may be invested in
other securities including, but not limited to, convertible securities,
preferred stocks, bonds, warrants and foreign securities. In periods during
which the Manager feels that market conditions warrant a more defensive
portfolio positioning, the Fund may also invest temporarily in various types of
fixed income obligations.
In addition, from time to time, the Fund may also engage in the
following investment techniques:
Repurchase Agreements--While the Fund is permitted to do so, it
normally does not invest in repurchase agreements, except to invest cash
balances.
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 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
terms of the Order and subject generally to the conditions described below.
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.

<PAGE>

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; and 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 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.

* * *

Restricted Securities
The Fund may invest in restricted securities, including unregistered
securities eligible for resale without registration pursuant to Rule 144A ("Rule
144A Securities") under the Securities Act of 1933 ("1933 Act"). Rule 144A
Securities may be freely traded among qualified institutional investors without
registration under the 1933 Act.
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 time, uninterested in purchasing these securities. After
the purchase of a Rule 144A Security, however, the Board of Directors and the
Manager will continue to monitor the liquidity of that security to ensure that
the Fund has no more than 10% of its net assets in illiquid securities.
Options--The Fund may write call options and purchase put options on a
covered basis only, and will not engage in option writing strategies for
speculative purposes.
A. Covered Call Writing--The Fund may write covered call options, from
time to time, on such portion of its portfolio, without limit, as the Manager
determines is appropriate in seeking to obtain the Fund's investment objective.
A call option gives the purchaser of such option the right to buy, and the
writer, in this case the Fund, has the obligation to sell the underlying
security at the exercise price during the option period. The advantage to the
Fund of writing covered calls is that the Fund receives additional income, in
the form of a premium, which may offset any capital loss or decline in market
value of the security. However, if the security rises in value, the Fund may not
fully participate in the market appreciation.

<PAGE>

During the option period, a covered call option writer may be assigned
an exercise notice by the broker/dealer through whom such call option was sold
requiring the writer to deliver the underlying security against payment of the
exercise price. This obligation is terminated upon the expiration of the option
period or at such earlier time in which the writer effects a closing purchase
transaction. A closing purchase transaction cannot be effected with respect to
an option once the option writer has received an exercise notice for such
option.
With respect to both options on actual portfolio securities owned by
the Fund and options on stock indices, the Fund may enter into closing purchase
transactions. A closing purchase transaction is one in which the Fund, when
obligated as a writer of an option, terminates its obligation by purchasing an
option of the same series as the option previously written.
Closing purchase transactions will ordinarily be effected to realize a
profit on an outstanding call option, to prevent an underlying security from
being called, to permit the sale of the underlying security or to enable the
Fund to write another call option on the underlying security with either a
different exercise price or expiration date or both. The Fund may realize a net
gain or loss from a closing purchase transaction depending upon whether the net
amount of the original premium received on the call option is more or less than
the cost of effecting the closing purchase transaction. Any loss incurred in a
closing purchase transaction may be partially or entirely offset by the premium
received from a sale of a different call option on the same underlying security.
Such a loss may also be wholly or partially offset by unrealized appreciation in
the market value of the underlying security. Conversely, a gain resulting from a
closing purchase transaction could be offset in whole or in part by a decline in
the market value of the underlying security.
If a call option expires unexercised, the Fund will realize a
short-term capital gain in the amount of the premium on the option, less the
commission paid. Such a gain, however, may be offset by depreciation in the
market value of the underlying security during the option period. If a call
option is exercised, the Fund will realize a gain or loss from the sale of the
underlying security equal to the difference between the cost of the underlying
security, and the proceeds of the sale of the security plus the amount of the
premium on the option, less the commission paid.
The market value of a call option generally reflects the market price
of an underlying security. Other principal factors affecting market value
include supply and demand, interest rates, the price volatility of the
underlying security and the time remaining until the expiration date.
The Fund will write call options only on a covered basis, which means
that the Fund will own the underlying security subject to a call option at all
times during the option period. Unless a closing purchase transaction is
effected, the Fund would be required to continue to hold a security which it
might otherwise wish to sell, or deliver a security it would want to hold.
Options written by the Fund will normally have expiration dates between one and
nine months from the date written. The exercise price of a call option may be
below, equal to or above the current market value of the underlying security at
the time the option is written.
B. Purchasing Put Options--The Fund may invest up to 2% of its total
assets in the purchase of put options. The Fund will, at all times during which
it holds a put option, own the security covered by such option.
The Fund intends to purchase put options in order to protect against a
decline in the market value of the underlying security below the exercise price
less the premium paid for the option ("protective puts"). The ability to
purchase put options will allow the Fund to protect an unrealized gain in an
appreciated security in its portfolio without actually selling the security. If
the security does not drop in value, the Fund will lose the value of the premium
paid. The Fund may sell a put option which it has previously purchased prior to
the sale of the securities underlying such option. Such sales will result in a
net gain or loss depending on whether the amount received on the sale is more or
less than the premium and other transaction costs paid on the put option which
is sold.

<PAGE>

The Fund may sell a put option purchased on individual portfolio
securities or stock indices. Additionally, the Fund may enter into closing sale
transactions. A closing sale transaction is one in which the Fund, when it is
the holder of an outstanding option, liquidates its position by selling an
option of the same series as the option previously purchased.

Options on Stock Indices
A stock index assigns relative values to the common stocks included in
the index with the index fluctuating with changes in the market values of the
underlying common stock.
Options on stock indices are similar to options on stocks but have
different delivery requirements. Stock options provide the right to take or make
delivery of the underlying stock at a specified price. A stock index option
gives the holder the right to receive a cash "exercise settlement amount" equal
to (i) the amount by which the fixed exercise price of the option exceeds (in
the case of a put) or is less than (in the case of a call) the closing value of
the underlying index on the date of exercise, multiplied by (ii) a fixed "index
multiplier." Receipt of this cash amount will depend upon the closing level of
the stock index upon which the option is based being greater than (in the case
of a call) or less than (in the case of a put) the exercise price of the option.
The amount of cash received will be equal to such difference between the closing
price of the index and exercise price of the option expressed in dollars times a
specified multiple. The writer of the option is obligated, in return for the
premium received, to make delivery of this amount. Gain or loss to the Fund on
transactions in stock index options will depend on price movements in the stock
market generally (or in a particular industry or segment of the market) rather
than price movements of individual securities.
As with stock options, the Fund may offset its position in stock index
options prior to expiration by entering into a closing transaction on an
Exchange or it may let the option expire unexercised.
A stock index fluctuates with changes in the market values of the stock
so included. Some stock index options are based on a broad market index such as
the Standard & Poor's 500 or the New York Stock Exchange Composite Index, or a
narrower market index such as the Standard & Poor's 100. Indices are also based
on an industry or market segment such as the AMEX Oil and Gas Index or the
Computer and Business Equipment Index. Options on stock indices are currently
traded on the following Exchanges among others: The Chicago Board Options
Exchange, New York Stock Exchange and American Stock Exchange.

The effectiveness of purchasing or writing stock index options as a
hedging technique will depend upon the extent to which price movements in the
Fund's portfolio correlate with price movements of the stock index selected.
Because the value of an index option depends upon movements in the level of the
index rather than the price of a particular stock, whether the Fund will realize
a gain or loss from the purchase or writing of options on an index depends upon
movements in the level of stock prices in the stock market generally or, in the
case of certain indices, in an industry or market segment, rather than movements
in the price of a particular stock. Since the Fund's portfolio will not
duplicate the components of an index, the correlation will not be exact.
Consequently, the Fund bears the risk that the prices of the securities being
hedged will not move in the same amount as the hedging instrument.

It is also possible that there may be a negative correlation between
the index or other securities underlying the hedging instrument and the hedged
securities which would result in a loss on both such securities and the hedging
instrument. Accordingly, successful use by the Fund of options on stock indices
will be subject to the Manager's ability to predict correctly movements in the
direction of the stock market generally or of a particular industry. This
requires different skills and techniques than predicting changes in the price of
individual stocks.

<PAGE>

Positions in stock index options may be closed out only on an Exchange
which provides a secondary market. There can be no assurance that a liquid
secondary market will exist for any particular stock index option. Thus, it may
not be possible to close such an option. The inability to close options
positions could have an adverse impact on the Fund's ability to effectively
hedge its securities. The Fund will enter into an option position only if there
appears to be a liquid secondary market for such options.
The Fund will not engage in transactions in options on stock indices
for speculative purposes but only to protect appreciation attained, to offset
capital losses and to take advantage of the liquidity available in the option
markets.

Foreign Securities
The Fund may invest in securities of foreign companies. However, the
Fund will not invest more than 25% of the value of its total assets, at the time
of purchase, in foreign securities (other than securities of Canadian issuers
registered under the Securities Exchange Act of 1934 or American Depository
Receipts, on which there are no such limits).
There has been in the past, and there may be again in the future, an
interest equalization tax levied by the United States in connection with the
purchase of foreign securities such as those purchased by the Fund. Payment of
such interest equalization tax, if imposed, would reduce the Fund's rate of
return on its investment. Dividends paid by foreign issuers may be subject to
withholding and other foreign taxes which may decrease the net return on such
investments as compared to dividends paid to the Fund by United States
corporations.
Investors should recognize that investing in foreign corporations
involves certain considerations, including those set forth below, which are not
typically associated with investing in United States corporations. Foreign
corporations are not generally subject to uniform accounting, auditing and
financial standards and requirements comparable to those applicable to United
States corporations. There may also be less supervision and regulation of
foreign stock exchanges, brokers and listed corporations than exist in the
United States. The Fund may be affected either unfavorably or favorably by
fluctuations in the relative rates of exchange as between the currencies of
different nations and control regulations. Furthermore, there may be the
possibility of expropriation or confiscatory taxation, political, economic or
social instability or diplomatic developments which could affect assets of the
Fund held in foreign countries.
The Fund will, from time to time, conduct foreign currency exchange
transactions on a spot (i.e., cash) basis at the spot rate prevailing in the
foreign currency exchange market or through entering into contracts to purchase
or sell foreign currencies at a future date (i.e., a "forward foreign currency"
contract or "forward" contract). Investors should be aware that there are costs
and risks associated with such currency transactions. The Fund may enter into
forward contracts to "lock in" the price of a security it has agreed to purchase
or sell, in terms of U.S. dollars or other currencies in which the transaction
will be consummated. When the Manager believes that the currency of a particular
foreign country may suffer a decline against the U.S. dollar or against another
currency, the Fund may enter into a forward contract to sell, for a fixed amount
of U.S. dollars or other appropriate currency, the amount of foreign currency
approximating the value of some or all of the Fund's securities denominated in
such foreign currency. It is impossible to predict precisely the market value of
portfolio securities at the expiration of the forward contract. Accordingly, it
may be necessary for the Fund to purchase or sell additional foreign currency on
the spot market (and bear the expense of such purchase or sale) if the market
value of the security is less than or greater than the amount of foreign
currency the Fund is obligated to deliver.

<PAGE>

The Fund may incur gains or losses from currency transactions. No type
of foreign currency transaction will eliminate fluctuations in the prices of the
Fund's foreign securities or will prevent loss if the prices of such securities
should decline.
The Fund's Custodian for its foreign securities is Morgan Guaranty
Trust Company of New York, located at 60 Wall Street, New York, New York 10260.

High-Yield, High-Risk Securities
Investing in so-called "high-yield" or "high-risk" bonds entails
certain risks, including the risk of loss of principal, which may be greater
than the risks involved in investment grade bonds, and which should be
considered by investors contemplating an investment in the Fund. Such bonds are
sometimes issued by companies whose earnings at the time of issuance are less
than the projected debt service on the high-yield bonds. The risks include the
following:

A. Youth and Volatility of the High- Yield Market--Although the market
for high-yield bonds has been in existence for many years, including periods of
economic downturns, the high-yield market grew rapidly during the long economic
expansion which took place in the United States during the 1980s. During that
economic expansion, the use of high-yield debt securities to fund highly
leveraged corporate acquisitions and restructurings increased dramatically. As a
result, the high-yield market grew substantially during that economic expansion.
Although experts disagree on the impact recessionary periods have had and will
have on the high-yield market, some analysts believe a protracted economic
downturn would severely disrupt the market for high-yield bonds, would adversely
affect the value of outstanding bonds and would adversely affect the ability of
high-yield issuers to repay principal and interest. Those analysts cite
volatility experienced in the high-yield market in the past as evidence for
their position. It is likely that protracted periods of economic uncertainty
would result in increased volatility in the market prices of high-yield bonds,
an increase in the number of high-yield bond defaults and corresponding
volatility in the Fund's net asset value.
Although the Fund will not ordinarily purchase bonds rated below B by
Moody's and S&P, it may do so if the Manager believes that capital appreciation
is likely. The Fund will not invest more than 25% of its assets in such bonds.

<PAGE>

B. Liquidity and Valuation--The secondary market for high-yield
securities is currently dominated by institutional investors, including mutual
funds and certain financial institutions. There is generally no established
retail secondary market for high-yield securities. As a result, the secondary
market for high-yield securities is more limited and less liquid than other
secondary securities markets. The high-yield secondary market is particularly
susceptible to liquidity problems when the institutions which dominate it
temporarily cease buying bonds for regulatory, financial or other reasons, such
as the savings and loan crisis. A less liquid secondary market may have an
adverse effect on the Fund's ability to dispose of particular issues, when
necessary, to meet the Fund's liquidity needs or in response to a specific
economic event, such as the deterioration in the creditworthiness of the issuer.
In addition, a less liquid secondary market makes it more difficult for the Fund
to obtain precise valuations of the high-yield securities in its portfolio.
During periods involving such liquidity problems, judgment plays a greater role
in valuing high-yield securities than is normally the case. The secondary market
for high-yield securities is also generally considered to be more likely to be
disrupted by adverse publicity and investor perceptions than the more
established secondary securities markets. The Fund's privately placed high-yield
securities are particularly susceptible to the liquidity and valuation risks
outlined above.

C. Legislative and Regulatory Action and Proposals--There are a variety
of legislative actions which have been taken or which are considered from time
to time by the United States Congress which could adversely affect the market
for high-yield bonds. For example, Congressional legislation limited the
deductibility of interest paid on certain high-yield bonds used to finance
corporate acquisitions. Also, Congressional legislation has, with some
exceptions, generally prohibited federally-insured savings and loan institutions
from investing in high-yield securities. Regulatory actions have also affected
the high-yield market. For example, many insurance companies have restricted or
eliminated their purchases of high-yield bonds as a result of, among other
factors, actions taken by the National Association of Insurance Commissioners.
If similar legislative and regulatory actions are taken in the future, they
could result in further tightening of the secondary market for high-yield
issues, could reduce the number of new high-yield securities being issued.

<PAGE>

ACCOUNTING AND TAX ISSUES

When the Fund writes a call, or purchases a put option, an amount equal
to the premium received or paid by it is included in the section of the Fund's
assets and liabilities as an asset and as an equivalent liability.
In writing a call, the amount of the liability is subsequently "marked
to market" to reflect the current market value of the option written. The
current market value of a written option is the last sale price on the principal
Exchange on which such option is traded or, in the absence of a sale, the mean
between the last bid and asked prices. If an option which the Fund has written
expires on its stipulated expiration date, the Fund reports a realized gain. If
the Fund enters into a closing purchase transaction with respect to an option
which the Fund has written, the Fund realizes a gain (or loss if the cost of the
closing transaction exceeds the premium received when the option was sold)
without regard to any unrealized gain or loss on the underlying security, and
the liability related to such option is extinguished. Any such gain or loss is a
short-term capital gain or loss for federal income tax purposes. If a call
option which the Fund has written is exercised, the Fund realizes a capital gain
or loss (long-term or short-term, depending on the holding period of the
underlying security) from the sale of the underlying security and the proceeds
from such sale are increased by the premium originally received.
The premium paid by the Fund for the purchase of a put option is
recorded in the section of the Fund's assets and liabilities as an investment
and subsequently adjusted daily to the current market value of the option. For
example, if the current market value of the option exceeds the premium paid, the
excess would be unrealized appreciation and, conversely, if the premium exceeds
the current market value, such excess would be unrealized depreciation. The
current market value of a purchased option is the last sale price on the
principal Exchange on which such option is traded or, in the absence of a sale,
the mean between the last bid and asked prices. If an option which the Fund has
purchased expires on the stipulated expiration date, the Fund realizes a
short-term or long-term capital loss for federal income tax purposes in the
amount of the cost of the option. If the Fund sells the put option, it realizes
a short-term or long-term capital gain or loss, depending on whether the
proceeds from the sale are greater or less than the cost of the option. If the
Fund exercises a put option, it realizes a capital gain or loss (long-term or
short-term, depending on the holding period of the underlying security) from the
sale of the underlying security and the proceeds from such sale will be
decreased by the premium originally paid. However, since the purchase of a put
option is treated as a short sale for federal income tax purposes, the holding
period of the underlying security will be affected by such a purchase.
Options on Certain Stock Indices--Accounting for options on certain
stock indices will be in accordance with generally accepted accounting
principles. The amount of any realized gain or loss on closing out such a
position will result in a realized capital gain or loss for tax purposes. Such
options held by the Fund at the end of each fiscal year will be required to be
marked to market for federal income tax purposes. Sixty percent of any net gain
or loss recognized on such deemed sales or on any actual sales will be treated
as long-term capital gain or loss, and the remainder will be treated as
short-term capital gain or loss.

Other Tax Requirements--The Fund has qualified, and intends to continue
to qualify, as a regulated investment company under Subchapter M of the Internal
Revenue Code of 1986, as amended (the "Code"). The Fund must meet several
requirements to maintain its status as a regulated investment company. Among
these requirements are that at least 90% of its investment company taxable
income be derived from dividends, interest, payment with respect to securities
loans and gains from the sale or disposition of securities; that at the close of
each quarter of its taxable year at least 50% of the value of its assets
consists of cash and cash items, government securities, securities of other
regulated investment companies and, subject to certain diversification
requirements, other securities; and that less than 30% of its gross income be
derived from sales of securities held for less than three months.

<PAGE>

The requirement that not more than 30% of the Fund's gross income be
derived from gains from the sale or other disposition of securities held for
less than three months may restrict the Fund in its ability to write covered
call options on securities which it has held less than three months, to write
options which expire in less than three months, to sell securities which have
been held less than three months and to effect closing purchase transactions
with respect to options which have been written less than three months prior to
such transactions. Consequently, in order to avoid realizing a gain within the
three-month period, the Fund may be required to defer the closing out of a
contract beyond the time when it might otherwise be advantageous to do so. The
Fund may also be restricted in the sale of purchased put options and the
purchase of put options for the purpose of hedging underlying securities because
of the application of the short sale holding period rules with respect to such
underlying securities.
The straddle rules of Section 1092 may apply. Generally, the straddle
provisions require the deferral of losses to the extent of unrecognized gains
related to the offsetting positions in the straddle. Excess losses, if any, can
be recognized in the year of loss. Deferred losses will be carried forward and
recognized in the following year, subject to the same limitation.

<PAGE>

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 its average
annual compounded total rate of return for that Class over, as relevant, the
most recent one-, five- and ten-year (or life of fund, if applicable) periods.
The Fund may also advertise aggregate and average total return information of
each Class over additional periods of time.
Average annual total rate of return for a 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:

P(1+T)n = ERV

Where: P = a hypothetical initial purchase order
of $1,000 from which the
maximum front-end sales charge
with respect to Class A Shares, 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 the 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- and
five-year periods ended May 31, 1995 and for the life of the Fund, 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 Class A Shares at net asset value (NAV) does not
reflect the payment of the maximum front-end sales charge of 5.75%. Securities
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.

<PAGE>

Average Annual Total Return
Class A Class A Institu-
Shares Shares tional
(at Offer) (at NAV) Class(2)

1 year
ended
5/31/95 (3.81%) 2.04% 2.38%

3 years
ended
5/31/95 8.27% 10.43% 10.72%

5 years
ended
5/31/95 11.62% 12.96% 13.14%

Period
6/24/87(1)
through
5/31/95 12.57% 13.41% 13.52%

(1) Date of initial public offering of Class A Shares.
(2) Date of initial public offering was November 9, 1992.

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 May 31, 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 May 31, 1995. The aggregate
total return for Class B Shares excluding deferred sales charge assumes the
shares were not redeemed at May 31, 1995 and therefore does not reflect the
deduction of a CDSC.

Aggregate Total Return
Class B Shares Class B Shares
(Including (Excluding
Deferred Sales Deferred Sales
Charge) Charge)
Period
9/6/94(1)
through
5/31/95 (2.68%) 1.28%

(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.

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 &
Poor's 500 Stock Index, the Dow Jones Industrial Average, the Russell 2000 Index
TR, the NASDAQ Composite Index 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 Russell 2000 Index
TR is a total return weighted index which is comprised of 2000 of the smallest
stocks (on the basis of capitalization) in the Russell 3000 Index and is
calculated on a monthly basis. The NASDAQ Composite Index is a market
capitalization price only index that tracks the performance of domestic common
stocks traded on the regular NASDAQ market as well as National Market System
traded foreign common stocks and American Depository Receipts. The total return
performance reported 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.
Total return performance of each Class 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 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.

<PAGE>

The Fund may also state each Class' total return performance in the
form of an average annual return. This average annual return figure will be
computed by taking the sum of 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 or contingent deferred sales charge, 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.
Comparative information on the Consumer Price 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.
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 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.

Russell Indexes is an investment analysis service that provides both
current and historical stock performance information, focusing on the
business fundamentals of those firms issuing the security.

<PAGE>

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 performance of the Class A Shares and the Class B Shares, as shown
below, reflects maximum sales charges, if any, paid on the purchase or
redemption of shares, as applicable, 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 following tables are examples, for purposes of illustration only,
of cumulative total return performance for (a) Class A Shares and the
Institutional Class for the three-, six- and nine-month periods ended May 31,
1995, for the one-, three- and five-year periods ended May 31, 1995, and for the
life of the Fund; and (b) Class B Shares for the three- and six-month periods
ended May 31, 1995 and for the life of the Class. For these purposes, the
calculations assume the reinvestment of any realized securities profits
distributions and income dividends paid during the period. 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.

Cumulative Total Return

Dow
Class A Institu- Standard Jones NASDAQ
Shares tional & Poor's Indus- Com-
3 months (at Offer) Class(1) 500 trial posite
ended
5/31/95 (0.69%) 5.42% 10.19% 12.07% 8.93%

6 months
ended
5/31/95 0.60% 6.92% 19.16% 21.05% 15.23%

9 months
ended
5/31/95 (4.35%) 1.73% 14.50% 16.48% 12.93%

1 year
ended
5/31/95 (3.81%) 2.38% 20.16% 22.17% 17.60%

3 years
ended
5/31/95 26.93% 35.75% 39.78% 43.22% 47.71%

5 years
ended
5/31/95 73.29% 85.37% 71.69% 80.86% 88.37%

Period
6/24/87(2)
through
5/31/95 155.94% 173.67% 123.58% 139.59% 102.35%

(1) Date of initial public offering was November 9, 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 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.
(2) Date of initial public offering of Class A Shares.

<PAGE>

Class B Class B
Shares Shares
(Including (Excluding Dow
Deferred Deferred Standard Jones NASDAQ
Sales Sales & Poor's Indus- Com-
Charge) Charge) 500 trial posite
3 months
ended
5/31/95 1.23% 5.23% 10.19% 12.07% 8.93%

6 months
ended
5/31/95 2.43% 6.43% 19.16% 21.05% 15.23%

Period
9/6/94(1)
through
5/31/95 (2.68%) 1.28% 14.50% 16.48% 12.93%

(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.

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.

COMPOUNDED RETURNS
Results at various assumed fixed rates of return on a $10,000
investment compounded quarterly for 10 years:

[chart appears here]

9% Rate 11% Rate 13% Rate
of Return of Return of Return

12-'85 $10,931 $11,146 $11,365
12-'86 11,948 12,424 12,916
12-'87 13,060 13,848 14,679
12-'88 14,276 15,435 16,682
12-'89 15,605 17,204 18,959
12-'90 17,057 19,176 21,546
12-'91 18,645 21,374 24,487
12-'92 20,381 23,824 27,829
12-'93 22,278 26,554 31,627
12-'94 24,352 29,598 35,943

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.

<PAGE>

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 November 30, 1992, 1993 and 1994, the
aggregate dollar amounts of brokerage commissions paid by the Fund were $34,101,
$252,502 and $89,843, respectively. The aggregate dollar amount of brokerage
commissions paid for 1993 was higher due to the large number of purchases made
to the Fund during that year.
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 November 30, 1994, portfolio transactions
of the Fund in the amount of $10,928,720, resulting in brokerage commissions of
$40,072, 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 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.

<PAGE>

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 its shares as a factor in the
selection of brokers and dealers to execute Fund portfolio transactions.

Portfolio Turnover

Portfolio trading will be undertaken principally to accomplish the
Fund's objective in relation to anticipated movements in the general level of
interest rates. The Fund is free to dispose of portfolio securities at any time,
subject to complying with the Code and the Investment Company Act of 1940, when
changes in circumstances or conditions make such a move desirable in light of
the investment objective. The Fund will not attempt to achieve or be limited to
a predetermined rate of portfolio turnover, such a turnover always being
incidental to transactions undertaken with a view to achieving the Fund's
investment objective.

Under certain market conditions, the Fund may experience a high rate of
portfolio turnover which could exceed 100%. 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.
The degree of portfolio activity may affect brokerage costs of the Fund
and taxes payable by the Fund's shareholders to the extent of any net realized
capital gains. 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. In investing for capital appreciation, the Fund may hold
securities for any period of time. Portfolio turnover will also be increased if
the Fund writes a large number of call options which are subsequently exercised.
The turnover rate also may be affected by cash requirements from redemptions and
repurchases of Fund shares. Total brokerage costs generally increase with higher
portfolio turnover rates.
During the fiscal years ended November 30, 1993 and 1994, the Fund's
portfolio turnover rates were 32% and 14%, respectively.

<PAGE>

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 additional 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 $250 for Class A Shares and
$1,000 for Class B Shares and $1,000 for Class C Shares. The minimum initial
investment 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. Subsequent purchases generally must be at least $25 for Class A Shares,
$100 for Class B Shares and $100 for Class C Shares. The minimum subsequent
investment 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. There is a maximum purchase limitation of $250,000 with respect to each
purchase of Class B Shares and up to, but not including, $1,000,000 with respect
to each purchase of Class C Shares. (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 for 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 a lower annual 12b-1
Plan expense charge than Class B Shares and Class C Shares and generally are not
subject to a CDSC. There are no minimum purchase requirements for the
Institutional Class, but certain eligibility requirements must be satisfied.
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.
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. However, purchases not involving the issuance of
certificates are confirmed to the investor and credited to the shareholder's
account on 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.

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 5.75%; 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 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 contingent deferred sales charge
or 12b-1 Plan expenses.

<PAGE>

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.

Alternative Purchase Arrangements
The alternative purchase arrangements of Class A, Class B and Class C
Shares permit investors to choose the method of purchasing shares that is most
beneficial given the amount of their purchase, the length of time they expect to
hold their shares and other relevant circumstances. Investors should determine
whether, under 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 price 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 by
the Fund 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 no more than 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 have a conversion feature.

Class A Shares
Purchases of $100,000 or more of Class A Shares at the offering price
currently 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.

Class A Shares
------------------------------------------------------------------------------
Dealer's
Front-End Sales Charge as % of Concession***
Amount of Purchase Offering Amount as % of
Price Invested** Offering Price
------------------------------------------------------------------------------
Less than $100,000 5.75% 6.10% 5.00%
$100,000 but under $250,000 4.75 4.99 4.00
$250,000 but under $500,000 3.50 3.63 3.00
$500,000 but under $1,000,000* 3.00 3.09 2.60

* There is no front-end sales charge on purchases of $1 million or more but,
under certain limited circumstances, a 1% contingent deferred sales charge
may apply. The contingent deferred sales charge ("Limited CDSC") that may
be applicable to purchases of Class A Shares arises only in the case of
certain net asset value purchases which have triggered the payment of a
dealer's commission.
** Based upon 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.

------------------------------------------------------------------------------

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 purchases and
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 dealers up to the full 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.

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.

<PAGE>

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:

Dealer's
Commission
----------
(as a percent-
Amount age of amount
of Purchase purchased)
-----------
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

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 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 redemption of shares received from reinvestment of dividends or
capital gains distributions. See the Prospectus for the Fund Classes under
Buying Shares - Contingent Deferred Sales Charge 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:

Contingent Deferred
Sales Charge (as a
Percentage of
Dollar Amount
Year After Purchase Made Subject to Charge)
------------------------ ---------------------
0-2 4%
3-4 3%
5 2%
6 1%
7 and thereafter None

<PAGE>

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 annual 12b-1 Plan expenses of 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 Investment Company Act of 1940, 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 Shares, the Class B Shares and the 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 Class B 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 .30% of the Class A Shares'
average daily net assets for the year, and 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.
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, the Distribution Agreement and the form of service agreement
have all 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
Investment Company Act of 1940) 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 Agreements. Continuation of the
Plans, the Distribution Agreement and the form of service agreement must be
approved annually by the Board of Directors in the same manner as specified
above.

<PAGE>

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, the
Distribution Agreement and the service agreement with any broker/dealers or
others relating to a Fund Class 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." 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 November 30, 1994, payments from the Class A
Shares pursuant to its Plan amounted to $521,464 and such amount was used for
the following purposes: $472 - Advertising; $9,823 - Annual/Semi-Annual Reports;
$418,973 Broker Trails; $71,987 - Commission to Wholesalers; $458 - Dealer
Service Expenses; $6,027 - Promotional-Other; $4,217 - Promotional- Broker
Meetings; $7,355 - Prospectus Printing; and $2,152 - Wholesaler Expenses. For
the period September 6, 1994 (date of initial public offering) through November
30, 1994, payments from the Class B Shares pursuant to its Plan amounted to
$1,703 and such amount was used for the following purposes: $570 - Broker Sales
Charges; $405 Broker Trails; $88 - Commission to Wholesalers; $620 - Interest on
Broker Sales Charges; $7 Telephone; and $13 - Promotional-Broker Meetings.
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.

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.
In connection with the sale of Delaware Group fund shares, the
Distributor may, at its own expense, pay to participate in or reimburse dealers
with whom it has a selling agreement for expenses incurred in connection with
seminars and conferences sponsored by such dealers and may pay or allow
additional promotional incentives, 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, in the form of sales contests to dealers
who sell shares of the funds. Such seminars and conferences and the terms of
such sales contests must be preapproved by the Distributor. Payment may be up to
100% of the expenses incurred or awards made in connection with seminars,
conferences or contests relating to the promotion of fund shares.
The Distributor may also pay a portion of the expense of preapproved
dealer advertisements promoting the sale of Delaware Group fund shares.

<PAGE>

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 contingent deferred sales charge 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 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.

<PAGE>

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 90 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 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 20
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
(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 the 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 the age
21; or a trustee or other fiduciary of trust estates or fiduciary accounts for
the benefit of such family members (including certain employee benefit
programs).

<PAGE>

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
shares 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 4.75%. 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 the 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 Shares. The reinvestment
privilege does not extend to redemption of Class B and 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.

<PAGE>

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 Delaware 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.

Value 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 accounts 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 or contingent deferred sales charge
and are not subject to Rule 12b-1 expenses.

<PAGE>

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 for
$25 or more for Class A Shares and $100 or more for Class B and Class C Shares;
no minimum applies to the Institutional Class. Such purchases 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 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.

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
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.

<PAGE>

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.

* * *

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 the Prospectus for the Fund Classes under Redemption and Exchange
- Waiver of CDSC and Limited CDSC for a list of the instances in which the CDSC
is waived.

<PAGE>

A maximum purchase limitation of $250,000 with respect to Class B Shares
(if available) and up to, but not including, $1,000,000 with respect to Class C
Shares is imposed on the initial purchase of such shares by a retirement plan.
The maximum purchase limitations apply only to the initial purchase of shares by
the retirement plan. Minimum investment limitations 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
Value 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 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.

<PAGE>

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 Funds 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 25 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 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 ____.

<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 ____.

<PAGE>

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 such 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 or foreign securities exchange, except
for bonds, are valued at the last sales price on that exchange. Options are
valued at the last reported sales price or, if no sales are reported, at the
mean between bid and asked prices. For valuation purposes, foreign securities
initially expressed in foreign currency values will be converted into U.S.
dollar values at the mean between the bid and offered quotations of such
currencies against U.S. dollars as last quoted by any recognized dealer.
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 60 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 the 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.

<PAGE>

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, Class C Shares or Institutional Class shares,
unless a shareholder specifically requests them. The Fund does not issue
certificates for Class B 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 (less any 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.

<PAGE>

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 either in 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 Investment Company Act of 1940
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 redeems shares from an account that has remained below
the minimum amounts required by the Fund's Prospectus 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
60 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
Prospectus. 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.

* * *

The Fund has available certain redemption privileges, as described below.
The Fund reserves the right to suspend or terminate these expedited payment
procedures upon 60 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 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.

<PAGE>

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 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 Plan

Shareholders of Class A Shares 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 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.

<PAGE>

Checks are dated the 15th of the month (unless such date falls on a
holiday or a Sunday) 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 C
Shares pursuant to a Systematic Withdrawal Plan may be subject to a CDSC, if the
shares redeemed were purchased within the 12 months prior to the withdrawal and
the annual withdrawal amount exceeds 12% of the value of the shares that were
purchased on the day that the 12-month period commenced. Each purchase of Class
C Shares will be subject to its own 12% limitation and will commence its own
12-month measuring period. See Waiver of CDSC and Limited CDSC 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 Class B
Shares or 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 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.

<PAGE>

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.

<PAGE>

DISTRIBUTIONS AND 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 on net investment income and net
realized capital gains which are distributed to shareholders.
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.

The Fund intends to pay out substantially all of its net investment
income and net realized capital gains. Such payments, if any, will be made once
a year during the first quarter of the following fiscal year. All dividends and
any capital gains distributions will be automatically credited to the
shareholder's account in additional shares of the same class of the Fund 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.

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. 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 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. During the fiscal year ended November 30, 1994, a dividend of
$0.035 and $0.080 per share of the Class A Shares and the Institutional Class,
respectively, was paid from net investment income and a distribution of $0.170
per share of the Class A Shares and the Institutional Class was paid from
realized securities profits. Dividends of $0.160, $0.150 and $0.215 per share
were paid from the net investment income of the Class A Shares, the Class B
Shares and the Institutional Class, respectively, and a capital gain of $0.250
per share of each such Class was paid from realized securities profits on
January 5, 1995 to shareholders of record as of December 27, 1994. Persons not
subject to tax will not be required to pay taxes on distributions.

Dividends from investment income and short-term capital gains
distributions are treated by shareholders as ordinary income for federal income
tax purposes. Distributions of long-term capital gains, if any, are taxable to
shareholders as long-term capital gains, 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 paid to
shareholders will not be affected by whether they are paid in cash or in
additional shares.

A portion of the Fund's dividends may qualify for the dividends-received
deduction for corporations provided in the federal income tax law. The portion
of dividends paid by the Fund that so qualifies will be designated each year in
a notice 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 dividend-received
deduction is subject to certain holding period and debt financing restrictions
imposed under the Code on the corporation claiming the deduction. For the fiscal
year ended November 30, 1994, 53% of the Fund's dividends from net investment
income was eligible for this deduction.

Shareholders will be notified annually by the Fund as to the federal
income tax status of dividends and distributions.
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 county personal property taxes.
See also Other Tax Requirements under Accounting and Tax Issues in this
Part B.

<PAGE>

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 November 30,
1994 were approximately $9,237,192,000. Investment advisory services are also
provided to institutional accounts with assets on November 30, 1994 of
approximately $15,544,258,000.

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 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 60 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 (the equivalent of 3/4 of 1% per year) of the
Fund's average daily net assets, less all directors' fees paid to the
unaffiliated directors by the Fund. This fee is higher than that paid by many
other funds; it may be higher or lower than that paid by funds with comparative
investment objectives. On November 30, 1994, the total net assets of the Fund
were $187,338,333. 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 for the fiscal years ended November 30, 1992, 1993 and 1994 amounted
to $181,460, $724,137, and $1,341,214, respectively.

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 of Class A Shares for the
fiscal year ended November 30, 1994 was 1.46%, which reflects the impact of its
12b-1 Plan. The ratio of expenses to average daily net assets for the
Institutional Class was 1.16% for the fiscal year ended November 30, 1994. Based
on expenses incurred by Class A Shares during its fiscal year ended November 30,
1994, the ratio of expenses to average daily net assets of Class B Shares is
expected to be 2.16% for the fiscal year ending November 30, 1995. The ratio of
expenses to average daily net assets of Class B Shares reflects the impact of
its 12b-1 Plan. 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 2 1/2% of its 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 November 30,
1994, no such reimbursement was necessary or paid.

<PAGE>

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 _____________, 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.

<PAGE>

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 ____________, 1995, the Fund's
officers and directors owned approximately 0%, 0% and 0% of the outstanding
shares of Class A, Class B and the Institutional Class, respectively.
As of ______________, 1995, [insert 5% holders]
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. As
a result of the merger, DMH became a wholly-owned subsidiary and the Manager
became an indirect, wholly-owned subsidiary of Lincoln National and both are now
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.

<PAGE>

*Wayne A. Stork (58)
Chairman, President, Chief Executive Officer, Director and/or Trustee of
the Fund, each of the other 16 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 and 15 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 Service Company, Inc., Delaware International
Advisers Ltd. and Delaware Management Trust Company.
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 16 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.

Walter P. Babich (68)
Director and/or Trustee of the Fund and each of the other 16 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.

-----------
* Director affiliated with the investment manager of the Fund and considered an
"interested person" as defined in the Investment Company Act of 1940.

<PAGE>

Anthony D. Knerr (56)
Director and/or Trustee of the Fund and each of the other 16 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 16 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 (75)
Director and/or Trustee of the Fund and each of the other 16 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 16 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.

<PAGE>

David K. Downes (55)
Senior Vice President/Chief Administrative Officer/Chief Financial
Officer of the Fund, each of the other 16 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 and Director of
Delaware Distributors, Inc.
Senior Vice President/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/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 16
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.

David C. Dalrymple (37)
Vice President/Senior Portfolio Manager of the Fund and seven other
equity funds in the Delaware Group.
Before joining the Delaware Group in 1991, Mr. Dalrymple was an Assistant
Portfolio Manager for Lord Abbett and Company, New York, N.Y. from 1986
to 1991.

Joseph H. Hastings (45)
Vice President/Corporate Controller of the Fund, each of the other 16
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.

<PAGE>

Michael P. Bishof (33)
Vice President/Treasurer of the Fund, each of the other 16 funds in the
Delaware Group, Delaware Management Company, Inc., Delaware
Distributors, Inc., Delaware Distributors, L.P., 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.

<PAGE>

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 November 30, 1994 and an estimate of annual benefits to be received
upon retirement under the Delaware Group Retirement Plan for Directors/Trustees
as of November 30, 1994.

<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 $1,606.04 None $18,100 $39,619.35
Ann R. Leven $1,748.13 None $18,100 $44,590.02
Walter P. Babich $1,719.70 None $18,100 $43,595.90
John J. Connolly, Ed.D. $1,606.04 None $18,100 $39,619.35
Anthony D. Knerr $1,834.25 None $18,100 $43,962.29
Charles E. Peck $1,448.04 None $18,100 $36,483.40
John H. Durham $1,290.04 None $18,100 $33,813.40

</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 70 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 November 30, 1994, 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.

<PAGE>

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 60
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 or series
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 acting upon
written or telephone instructions for redemption or exchange of Fund shares
which are reasonably believed to be genuine.

<PAGE>

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 reserves the right to refuse any
new Timing Arrangements, as well as any new purchases (as opposed to exchanges)
in Delaware Group funds from Timing Firms.

Restrictions on Timed Exchanges
Timing Accounts operating under existing Timing Agreements may only
execute exchanges between the following six 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 and (6) Delaware Cash Reserve. 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 will terminate, except as noted above, all exchange privileges,
including telephone and written redemption privileges, previously made available
to Timing Firms. At such time, 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 Growth 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.

Trend Fund seeks long-term growth by investing in common stock issued by
emerging growth companies exhibiting strong capital appreciation 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 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.

<PAGE>

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 values
appear 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 market place 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).

<PAGE>

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 Rule 17j-1 under the Investment Company Act of 1940,
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. In its
capacity as such, DDI received net commissions from the Fund on behalf of Class
A Shares after reallowances to dealers, as follows:

Fiscal Total Amount Amounts Net
Year of Underwriting Reallowed Commission
Ending Commission to Dealers to DDI
------ --------------- ------------ -----------
11/30/94 $1,707,818 $1,480,648 $227,170
11/30/93 3,274,016 2,912,033 361,983
11/30/92 936,081 854,815 81,266

During the fiscal year ended November 30, 1994, in its capacity as the
Fund's national distributor, DDI received Limited CDSC payments in the amount of
$12,607 with respect to Class A Shares.
For the period September 6, 1994 (date of initial public offering)
through November 30, 1994, DDI also received CDSC payments in the amount of $995
with respect to Class B Shares.
Effective as of January 3, 1995, all such payments described above have
been paid to Delaware Distributors, L.P.

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 unaffiliated 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.
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.

<PAGE>

Morgan Guaranty Trust Company of New York, located at 60 Wall Street,
New York, New York 10260, provides similar services with respect to the Fund's
investments in foreign 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 five hundred
million shares of capital stock with a $.01 par value per share. Prior to
November 9, 1992, the Fund offered only one class of shares, the class currently
designated the Class A Shares. Beginning November 9, 1992, the Fund began
offering the Institutional Class, beginning September 6, 1994, the Fund began
offering the Class B Shares, and beginning as of the date of this Part B the
Fund began offering the Class C Shares. Each Class represents a proportionate
interest in the assets of the Fund, and each has 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'
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 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 Shares and Class C Shares
will be allocated solely to those classes. The Board of Directors has allocated
one hundred fifty million shares to Class A Shares, one hundred fifty million
shares to Class B Shares, fifty million shares to Class C Shares and fifty
million shares to the Institutional Class. Shares have equal voting rights,
no preemptive rights, are fully transferable and, when issued, are fully paid
and nonassessable.
Prior to September 6, 1994, Class A Shares were known as the Value Fund
class and the Institutional Class was known as the Value 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.

<PAGE>

APPENDIX A--DESCRIPTION OF RATINGS

Commercial Paper
Excerpts from Standard & Poor's Corporation's ("S&P") description of
its two highest commercial paper ratings: A-1--judged to be the highest
investment grade category possessing the highest relative strength;
A-2--investment grade category possessing less relative strength than the
highest rating.
Excerpts from Moody's Investors Service, Inc.'s ("Moody's") description
of its two highest commercial paper ratings: P-1--the highest grade possessing
greatest relative strength; P-2--second highest grade possessing less relative
strength than the highest grade.

Bonds
Excerpts from Moody's description of its bond ratings: Aaa--judged to
be the best quality. They carry the smallest degree of investment risk;
Aa--judged to be of high quality by all standards; A--possess favorable
attributes and are considered "upper medium" grade obligations; Baa--considered
as medium grade obligations. Interest payments and principal security appear
adequate for the present but certain protective elements may be lacking or may
be characteristically unreliable over any great length of time; Ba--judged to
have speculative elements; their future cannot be considered as well assured.
Often the protection of interest and principal payments may be very moderate and
thereby not well safeguarded during both good and bad times over the future.
Uncertainty of position characterizes bonds in this class; B--generally lack
characteristics of the desirable investment. Assurance of interest and principal
payments or of maintenance of other terms of the contract over any long period
of time may be small; Caa--are of poor standing. Such issues may be in default
or there may be present elements of danger with respect to principal or
interest; Ca--represent obligations which are speculative in a high degree. Such
issues are often in default or have other marked shortcomings; C--the lowest
rated class of bonds and issues so rated can be regarded as having extremely
poor prospects of ever attaining any real investment standing.
Excerpts from S&P's description of its bond ratings: AAA--highest grade
obligations. They possess the ultimate degree of protection as to principal and
interest; AA--also qualify as high grade obligations, and in the majority of
instances differ from AAA issues only in a small degree; A--strong ability to
pay interest and repay principal although more susceptible to changes in
circumstances; BBB--regarded as having an adequate capacity to pay interest and
repay principal; BB, B, CCC, CC--regarded, on balance, as predominantly
speculative with respect to capacity to pay interest and repay principal in
accordance with the terms of the obligation. BB indicates the lowest degree of
speculation and CC the highest degree of speculation. While such debt will
likely have some quality and protective characteristics, these are outweighed by
large uncertainties or major risk exposures to adverse conditions; C--reserved
for income bonds on which no interest is being paid; D--in default, and payment
of interest and/or repayment of principal is in arrears.

<PAGE>

APPENDIX B--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.

<PAGE>

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

[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%]

<PAGE>

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%]

<PAGE>

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.

<PAGE>

$2,000 SINGLE INVESTMENT AT A RETURN OF 10% COMPOUNDED ANNUALLY

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

$2,000 INVESTED ANNUALLY AT A RETURN OF 10% COMPOUNDED ANNUALLY

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>

<PAGE>

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.

After 5 years $3,528 more
10 years $6,113
20 years $17,228
30 years $47,295

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!

[chart appears here]

8% Return 10% Return

10 years $31,291 $35,062

20 years 98,846 126,005

30 years 244,692 361,887

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.

<PAGE>

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 state where sales show more definitive highs
and lows.

The above chart illustrates the path traditionally followed by
companies that successfully survive the growth sequence.

<PAGE>

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
November 30, 1994, 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. Unaudited financial statements and the notes relating thereto for the
six-month period ended May 31, 1995 are also incorporated by reference from the
Fund's Semi-Annual Report into this Part B.

<PAGE>

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.

---------------------------------------------------------
VALUE FUND
---------------------------------------------------------
A CLASS
---------------------------------------------------------
B CLASS
---------------------------------------------------------
C CLASS
---------------------------------------------------------
INSTITUTIONAL CLASS

---------------------------------------------------------

CLASSES OF DELAWARE GROUP
VALUE FUND, INC.

---------------------------------------------------------

PART B

STATEMENT OF
ADDITIONAL INFORMATION

---------------------------------------------------------

--------, 1995

DELAWARE
GROUP
---------

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value 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 into Part B from the Registrant's Annual Report for
the fiscal year ended November 30, 1994 which is included herein as an
Exhibit. In addition, the unaudited financial statements for the six-month
period ended May 31, 1995 are incorporated by reference from the Registrant's
Semi-Annual Report into Part B. The Registrant's Semi-Annual Report was
electronically filed with the Commission on August 4, 1995.

(b) Exhibits:

(1) Articles of Incorporation. Attached as Exhibit.

(2) By-Laws. Attached as Exhibit.

(3) Voting Trust Agreement. Inapplicable.

(4) Copies of all Instruments Defining the Rights of Holders.

(a) Articles of Incorporation, Articles of Amendment and
Articles Supplementary. Article Second of Articles
Supplementary, and Article Fifth and Article Eighth of
Articles of Incorporation included in Exhibit 24(b)(1).

(b) By-Laws. Article II, Article III, as amended, and
Article XIII, which was subsequently redesignated as
Article XIV included in Exhibit 24(b)(2).

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

(5) Investment Management Agreement. Investment Management
Agreement between Delaware Management Company, Inc. and the
Registrant dated April 3, 1995 attached as Exhibit.

(6) (a) Distribution Agreement. Form of Amended and Restated
Distribution Agreement incorporated by reference to Post-
Effective Amendment No. 11 filed July 5, 1994.

Distribution Agreement between Delaware Distributors,
L.P. and the Registrant to be filed by Amendment.

(b) Administration and Service Agreement. Form of
Administration and Service Agreement incorporated by
reference to Post-Effective Amendment No. 11 filed
July 5, 1994.

(d) Form of Mutual Fund Agreement for the Delaware Group of
Funds incorporated by reference to Post-Effective
Amendment No. 12 filed January 30, 1995.

(7) Bonus, Profit Sharing, Pension Contracts. Amended and
Restated Profit Sharing Plan included as Module Name
PROF_SHARE_PLAN.

(8) Custodian Agreement. Incorporated by reference to Post-
Effective Amendment No. 3 filed January 30, 1989,
Post-Effective Amendment No. 6 filed January 28, 1992 and
Post-Effective Amendment No. 9 filed January 29, 1993.

(9) Other Material Contracts. Incorporated by reference to Post-
Effective Amendment No. 2 filed November 28, 1988.

(10) Opinion of Counsel. Filed with letter relating to Rule 24f-2
on January 26, 1995.

(11) Consent of Auditors. Attached as Exhibit.

(12) Inapplicable.

(13) Undertaking of Initial Shareholder. Incorporated by reference
to Pre-Effective Amendment No. 2 filed June 17, 1987.

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

(14) Model Plans. Incorporated by reference to Post-Effective
Amendment No. 9 filed January 29, 1993 and Post-Effective
Amendment No. 10 filed January 28, 1994.

Amended Model Plans included as Module Name MODEL_PLANS.

**(15) Plans under Rule 12b-1. Form of Rule 12b-1 Plan incorporated
by reference to Post-Effective Amendment No. 11 filed July 5,
1994.

Plans under Rule 12b-1 to be filed by Amendment.

(16) Schedules of Computation for each Performance Quotation.
Attached as Exhibit.

(17) Financial Data Schedules. Attached as Exhibit.

(18) Plan under Rule 18f-3. Form of Rule 18f-3 Plan attached
as Exhibit.

(19) Other: Directors' Power of Attorney. Attached as Exhibit.

(20) Other: Financial Statements. The Registrant's Annual Report
for the fiscal year ended November 30, 1994 attached as
Exhibit.

**Relates to Value Fund A Class, Value Fund B Class and Value Fund C Class only.

Item 25. Persons Controlled by or under Common Control with Registrant. None.

Item 26. Number of Holders of Securities.

(1) (2)

Number of
Title of Class Record Holders
-------------- --------------
Delaware Group Value Fund, Inc.'s:

Value Fund A Class
Common Stock Par Value 15,153 Accounts as of
$.01 Per Share July 31, 1995

iii

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

Number of
Title of Class Record Holders
-------------- --------------

Value Fund B Class
Common Stock Par Value 421 Accounts as of
$.01 Per Share July 31, 1995

Value Fund C Class***
Common Stock Par Value 0 Accounts as of
$.01 Per Share July 31, 1995

Value Fund Institutional Class
Common Stock Par Value 19 Accounts as of
$.01 Per Share July 31, 1995

*** Value Fund C Class was not offered prior to the effective date of this
Registration Statement.

Item 27. Indemnification. Incorporated by reference to initial Registration
Statement filed January 23, 1987 and Article VII of the By-Laws, as
amended, attached in Exhibit 24(b)(2).

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 Trend 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 Treasury Reserves, 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 mutual funds in the
Delaware Group.

<PAGE>
Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

The following persons serving as directors or officers of the Manager
have held the following positions during the past two years:

Name and Principal Positions and Offices with Manager and its Affiliates
Business Address* and Other Positions and Offices Held
------------------ ------------------------------------------------------

Wayne A. Stork Chairman of the Board, Chief Executive Officer, Chief
Investment Officer and Director of Delaware
Management Company, Inc.; Chairman of the Board and
Director of the Registrant, each of the other funds
in the Delaware Group and Delaware Investment
Counselors, Inc.; Chairman, Chief Executive Officer
and Director of Delaware Management Holdings, Inc.,
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.

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

*Business address of each is 1818 Market Street, Philadelphia, PA 19103.

<PAGE>
Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

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

David K. Downes Senior Vice President, Chief Administrative Officer
and Chief Financial Officer of Delaware Management
Company, Inc., the Registrant, 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

*Business address of each is 1818 Market Street, Philadelphia, PA 19103.

<PAGE>
Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

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,
Founders CBO Corporation, Delaware International
Holdings Ltd. and Delaware Investment Counselors,
Inc.; 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 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.

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(2) 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(3) 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.

*Business address of each is 1818 Market Street, Philadelphia, PA 19103.

vii

<PAGE>
Form N-1A
File No. 33-11419
Delaware Group Value Fund, 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(4) Vice President/Operations of Delaware Management
Company, Inc. and Delaware Service Company, Inc.; and
Vice President/Operations and Director of Delaware
Management Trust Company

Diane Z. Frustaci Vice President/Human Resources of Delaware Management
Company, Inc., Delaware Distributors, L.P. and
Delaware Distributors, Inc; and Vice President/
Director of Human Resources of Delaware Service
Company, Inc.

Michael T. Taggart(5) 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., and 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

J. Michael Pokorny Vice President/Senior Portfolio Manager of Delaware
Management Company, Inc., and 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., and 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., and 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., and each of the tax-exempt
funds and the fixed income 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., and each of the tax-exempt
funds and the fixed income funds in the Delaware
Group

*Business address of each is 1818 Market Street, Philadelphia, PA 19103.

viii

<PAGE>
Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

Roger A. Early(6) Vice President/Senior Portfolio Manager of Delaware
Management Company, Inc., and 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.

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

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

(1) VICE PRESIDENT/GLOBAL INVESTMENT MANAGEMENT OPERATIONS, Bankers Trust and
VICE PRESIDENT, CS First Boston Investment Management prior to June 1995.
(2) ASSISTANT VICE PRESIDENT AND DIRECTOR OF INTERNAL AUDIT, Vanguard Group
prior to June 1993 and SENIOR VICE PRESIDENT AND DIRECTOR OF INTERNAL AUDIT,
Thomson McKinnon Securities prior to December 1989.
(3) VICE PRESIDENT AND COMPLIANCE OFFICER, Banc One Securities Corporation prior
to June 1993 and ASSISTANT VICE PRESIDENT AND COMPLIANCE OFFICER, Aetna Life
and Casualty prior to March 1993.
(4) VICE PRESIDENT OF OPERATIONS, Supervised Service Company prior to March
1994.
(5) ASSISTANT VICE PRESIDENT/ADMINISTRATIVE SERVICES, United Pacific Life
Insurance prior to January 1994.
(6) SENIOR VICE PRESIDENT AND PORTFOLIO MANAGER, Federated Investors prior
to July 1994.

*Business address of each is 1818 Market Street, Philadelphia, PA 19103.

<PAGE>
Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

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 Position and Offices Position 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

Brian F. Wruble Chairman President and Chief
Executive Officer

Winthrop S. Jessup Vice Chairman Executive Vice President

Keith E. Mitchell President and Chief None
Executive Officer

David K. Downes Senior Vice President and Senior Vice President/Chief
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
and Tax Affairs
</TABLE>

*Business address of each is 1818 Market Street, Philadelphia, PA 19103.

<PAGE>

Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Position and Offices Position and Offices
Business Address* with Underwriter with Registrant
------------------ --------------------- --------------------
<S> <C> <C>
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

Diane M. Anderson Vice President/ None
Retirement Services

Diane Z. Frustaci Vice President/Human Resources None

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
</TABLE>

*Business address of each is 1818 Market Street, Philadelphia, PA 19103.

<PAGE>
Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.
<TABLE>
<CAPTION>
Name and Principal Position and Offices Position and Offices
Business Address* with Underwriter with Registrant
------------------ --------------------- --------------------
<S> <C> <C>

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

William M. Kimbrough Vice President/Bank Sales None

Mac McAuliffe Vice President/Wholesaler None

Patrick L. Murphy Vice President/Wholesaler None

Henry W. Orvin Vice President/Wholesaler None

Jackson B. Reece, Jr. 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.

xii

<PAGE>
Form N-1A
File No. 33-11419
Delaware Group Value Fund, Inc.

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.

(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.

xiii

<PAGE>
SIGNATURES

Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, the Registrant 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 day of
September 13, 1995.

DELAWARE GROUP VALUE FUND, INC.

By /s/Wayne A. Stork
-------------------------------------
Wayne A. Stork
Chairman of the Board 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>

/s/Wayne A. Stork Chairman of the Board and Director September 13, 1995
--------------------------
Wayne A. Stork

(currently vacant) President and Chief Executive Officer
--------------------------

/s/David K. Downes* Senior Vice President/Chief Financial September 13, 1995
-------------------------- Officer/Chief Administrative Officer
David K. Downes (Principal Financial Officer and
Principal Accounting Officer)

/s/Walter P. Babich* Director September 13, 1995
--------------------------
Walter P. Babich

/s/Charles E. Peck* Director September 13, 1995
--------------------------
Charles E. Peck

/s/Ann R. Leven* Director September 13, 1995
--------------------------
Ann R. Leven

/s/W. Thacher Longstreth* Director September 13, 1995
--------------------------
W. Thacher Longstreth

/s/Anthony D. Knerr* Director September 13, 1995
--------------------------
Anthony D. Knerr

*By _______________________
Wayne A. Stork
Attorney-in-Fact

</TABLE>

<PAGE>

SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549

Exhibits

Form N-1A

REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933

<PAGE>

INDEX TO EXHIBITS

Exhibit No. Exhibit
----------- -------

EX-99.B1 Articles of Incorporation

EX-99.B2 By-Laws

EX-99.B5 Investment Management Agreement

EX-99.B6C Dealer's Agreement
(Module Name
DEALERS_AGREE)

EX-99.B7 Amended and Restated Profit
(Module Name Sharing Plan
PROF_SHARE_PLAN)

EX-99.B11 Consent of Auditors

EX-99.B14 Amended Model Plans
(Module Name
MODEL_PLANS)

EX-99.B16 Schedules of Computation for
each Performance Quotation

EX-27 Financial Data Schedules

EX-99.B18 Form of Rule 18f-3 Plan

EX-99.B19 Directors' Power of Attorney

EX-99.B20 Financial Statements: Annual Report for
the fiscal year ended November 30, 1994

<PAGE>

ARTICLES OF INCORPORATION

DELAWARE GROUP INSIGHT FUND, INC.

FIRST: The undersigned, George M. Chamberlain, Jr., whose post office
address is Ten Penn Center Plaza, Philadelphia, Pennsylvania 19103, and being at
lest eighteen years of age, does hereby cause to be filed these Articles of
Incorporation for the purpose of forming a corporation under the General
Corporation Law of the State of Maryland.

SECOND: The name of the corporation is Delaware Group Insight Fund, Inc.

THIRD: The purpose for which the corporation is formed is to operate as an
investment company and to exercise all of the powers and to do any and all of
the things as fully and to the same extent as any other corporation incorporated
under the laws of the State of Maryland, now or hereinafter in force, including,
without limitation, the following:

1. To purchase, hold, invest and reinvest in, sell, exchange,
transfer, mortgage, and otherwise acquire and dispose of securities of every
kind, character and description.

2. To exercise all rights, powers and privileges with reference to or
incident to ownership, use and enjoyment of any of such securities, including,
but without limitation, the right, power and privilege to own, vote, hold,
purchase, sell negotiate, assign, exchange, transfer, mortgage, pledge or
otherwise deal with, dispose of, use, exercise or enjoy any rights, title,
interest, powers or privileges under or with reference to any of such
securities; and to do any and all acts and things for the preservation,
protection, improvement and enhancement in value of any of such securities.

3. To purchase or otherwise acquire, own, hold, sell, exchange,
assign, transfer, mortgage, pledge or otherwise dispose of, property of all
kinds.

4. To buy, sell, mortgage, encumber, hold, own, exchange, rent or
otherwise acquire and dispose of, and to develop, improve, manage, subdivide,
and generally to deal and trade in real property, improved and unimproved, and
wheresoever situate; and to build, erect, construct, alter and maintain
buildings structures, and other improvement on real property.

5. To borrow or raise moneys for any of the purposes of the
corporation, and to mortgage or pledge the whole or any part of the property and
franchises of the corporation, real, personal, and mixed, tangible or
intangible, and wheresoever situate.

<PAGE>

6. To enter into, make and perform contracts and undertakings of every
kind for any lawful purpose, without limit as to amount.

7. To issue, purchase, sell and transfer, reacquire, hold, trade and
deal in, to the extent permitted under the General Corporation Law of the State
of Maryland, capital stock, bonds, debentures and other securities of the
corporation, from time to time, to such extent as the Board of Directors shall,
consistent with the provisions of these Articles of Incorporation, determine;
and to repurchase, reacquire and redeem, to the extent permitted under the
General Corporation Law of the State of Maryland, from time to time, the shares
of its own capital stock, bonds, debentures and other securities.

The foregoing clauses shall each be construed as purposes, objects and
powers, and it is hereby expressly provided that the foregoing enumeration of
specific purposes, objects and powers shall not be held to limit or restrict in
any manner the powers of the corporation, and that they are in furtherance of,
and in addition to, and not in limitation of, the general powers conferred upon
the corporation by the laws of the State of Maryland or otherwise; nor shall the
enumeration of one thing be deemed to exclude another, although it be of like
nature, not expressed.

FOURTH: The post office address of the principal office of the corporation
in the State of Maryland is:

c/o The Corporation Trust, Incorporated
32 South Street
Baltimore, Maryland 21202

The name and post office address of the initial resident agent of the
corporation in the State of Maryland is:

The Corporation Trust, Incorporated
32 South Street
Baltimore, Maryland 21202

<PAGE>

FIFTH: The total number of shares of stock which the corporation shall have
authority to issue is Five Hundred Million (500,000,000) shares of stock, with a
par value of One Cent ($.01) per share, to be known and designated as Common
Stock, such shares of Common Stock having an aggregate par value of Five Million
Dollars ($5,000,000).

Subject to the provisions of these Articles of Incorporation, the
Board of Directors shall have the power to issue shares of Common Stock of the
corporation from time to time, at prices not less than the net asset value or
par value thereof, whichever is greater, for such consideration as may be fixed
from time to time pursuant to the direction of the Board of Directors.

Pursuant to Section 2-105 of the Maryland General Corporation Law, the
Board of Directors of the corporation shall have the power to designate one or
more series of shares of Common Stock and to classify or reclassify any unissued
shares with respect to such series and such series (subject to any applicable
rule, regulation or order of the Securities and Exchange Commission or other
applicable law or regulation) shall have such preferences, conversion or other
rights, voting powers, restrictions, limitations as to dividends,
qualifications, terms and conditions of redemption and other characteristics as
the Board may determine in the absence of contrary determination set forth
herein. Subject to the aforesaid power of the Board of Directors, one series of
shares is hereby initially designated as Series I and One Hundred Million
(100,000,000) shares of Common Stock (par value $.01 per share) is hereby
initially classified and allocated to such series. At any time when there are no
shares outstanding or subscribed for a particular series previously established
and designated herein or by the Board of Directors, the series may be liquidated
by similar means. Each share of a series shall have equal rights with each other
share of that series with respect to the assets of the corporation pertaining to
that series. The dividends payable to the holders of any series (subject to any
applicable rule, regulation or order of the Securities and Exchange Commission
or any other applicable law or regulation) shall be determined by the Board and
need not be individually declared, but may be declared and paid in accordance
with a formula adopted by the Board. Except as otherwise provided herein, all
references in these Articles of Incorporation to Common Stock or series of stock
shall apply without discrimination to the shares of each series of stock.

The holder of each share of stock of the corporation shall be entitled
to one vote for each full share, and a fractional vote for each fractional share
of stock, irrespective of the series then standing in his or her name in the
books of the corporation. On any matter submitted to a vote of shareholders, all
shares of the corporation then issued and outstanding and entitled to vote,
irrespective of the series, shall be voted in the aggregate and not by

<PAGE>

series except (1) when otherwise expressly provided by the Maryland General
Corporation Law, or (2) when required by the Investment Company Act of 1940, as
amended, shares shall be voted by individual series; and (3) when the matter
does not affect any interest of a particular series, then only shareholders of
affected series shall be entitled to vote thereon. Holders of shares of stock of
the corporation shall not be entitled to cumulative voting in the election of
directors or on any other matter.

Each series of stock of the corporation shall have the following
powers, preferences and participating, voting, or other special rights and the
qualifications, restrictions, and limitations thereof shall be as follows:

1. All consideration received by the corporation for the issue or sale
of stock of each series, together with all income, earnings, profits, and
proceeds thereof, including any proceeds derived from the sale, exchange or
liquidation thereof, and any funds or payments derived from any reinvestment of
such proceeds in whatever form the same may be, shall irrevocably belong to the
series of shares of stock with respect to which such assets, payments or funds
were received by the corporation for all purposes, subject only to the rights of
creditors, and shall be so handled upon the books of account of the corporation.
Such assets, income, earnings, profits and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation thereof and any assets
derived from any reinvestment of such proceeds, in whatever form the same may
be, are herein referred to as "assets belonging to" such series.

2. The Board of Directors may from time to time declare and pay
dividends or distributions, in stock or in cash, on any or all series of stock;
provided, such dividends or distributions on shares of any series of stock shall
be paid only out of earnings, surplus, or other lawfully available assets
belonging to such series.

3. The Board of Directors shall have the power in its discretion to
distribute to the shareholders of the corporation or to the shareholders of any
series thereof in any fiscal year as dividends, including dividends designated
in whole or in part as capital gain distributions, amounts sufficient, in the
opinion of the Board of Directors, to enable the corporation or any series
thereof to qualify as a "regulated investment company" under the Internal
Revenue Code 1954, as amended, or any successor or comparable statute thereto,
and regulations promulgated thereunder (collectively, the "IRC"), and to avoid
liability of the corporation or any series thereof for Federal income tax in
respect of that year and to make other appropriate adjustments in connection
therewith.

4. The Board of Directors shall have the power, in its discretion, to
make such elections as to the tax status of the corporation or any series or
class of the corporation as may be permitted or required under the IRC as
presently in effect or as amended, without the vote of shareholders of the
corporation or any series thereof.

<PAGE>

5. In the event of the liquidation or dissolution of the corporation,
shareholders of each series shall be entitled to receive, as a series, out of
the assets of the corporation available for distribution to shareholders, but
other than general assets not belonging to any particular series of stock, the
assets belonging to such series, and the assets so distributable to the
shareholders of any series shall be distributed among such shareholders in
proportion to the number of shares of such series held by them and recorded on
the books of the corporation. In the event that there are any general assets not
belonging to any particular series of stock and available for distribution, such
distribution shall be made to the holders of stock of all series in proportion
to the net asset value of the respective series determined as hereinafter
provided.

6. The assets belonging to any series of stock shall be charged with
the liabilities in respect to such series, and shall also be charged with its
share of the general liabilities of the corporation, in proportion to the net
asset value of the respective series determined as hereinafter provided. The
determination of the Board of Directors shall be conclusive as to the amount of
liabilities, including accrued expenses and reserves, as to the allocation of
the same as to a given series, and as to whether the same or general assets of
the corporation are allocable to one or more series.

The net asset value per share of a series of the corporation's common
stock shall be determined in accordance with the Investment Company Act of 1940,
as amended, and with generally accepted accounting principles, by adding the
market or appraised value of all securities, cash and other assets of the
corporation pertaining to that series, subtracting the liabilities determined by
the Board of Directors to be applicable to that series, allocating any general
assets and general liabilities to that series, and dividing the net result by
the number of shares of that series outstanding. Securities and other
investments and assets will be valued at the current market value, and in the
absence of a readily available market value, will be valued at fair value as
determined in good faith by the Board of Directors.

7. The Board of Directors may provide for a holder of any series of
stock of the corporation, who surrenders his certificate in good form for
transfer to the corporation or, if the shares in question are not represented by
certificates, who delivers to the corporation a written request in good order
signed by the shareholder, to convert the shares in question on such

<PAGE>

basis as the Board may provide, into shares of stock of any other series of the
corporation.

8. The holders of the shares of Common Stock or other securities of
the corporation shall have no preemptive rights to subscribe to new or
additional shares of its Common Stock or other securities.

SIXTH: The number of directors of the Corporation shall be such number as
may from time to time be fixed by the By-Laws of the corporation or pursuant to
authorization contained in such By-Laws; provided, notwithstanding anything
herein to the contrary, the board of directors shall initially consist of eight
directors until such time as the number of directors is fixed as stated above.
The name of the directors who shall act as such until successors are duly chosen
and qualify are: John H. Durham, William P. Brady, Milton Fritsche, William
Buchanan Gold, Jr., Paul I. Guest, W. Thacher Longstreth, J. Permar Richards,
and James P. Schellenger.

SEVENTH: The following provisions are inserted for the management of the
business and for the conduct of the affairs of the corporation:

1. The Board of Directors shall have power to fix an initial offering
price for the shares of any series which shall yield to the corporation not less
than the par value thereof, at which price the shares of the Common Stock of the
corporation shall be offered for sale, and to determine from time to time
thereafter the offering price which shall yield to the corporation not less than
the par value thereof from sales of the shares of its Common Stock; provided,
however, that no shares of the Common Stock of the corporation shall be issued
or sold for a consideration which shall yield to the corporation less than the
net asset value of shares of such series determined as hereinafter provided, as
of the business day on which such shares are sold, or at such other times set by
the Board of Directors, except in the case of shares of such Common Stock issued
in payment of a dividend properly declared and payable.

The net asset value of the property and assets of any series of the
corporation shall be determined at such times as the Board of Directors may
direct, by deducting from the total appraised value of all of the property and
assets of the corporation, determined in the manner hereinafter provided, all
debts, obligations and liabilities of the corporation (including, but without
limitation of the generality of any of the foregoing, any or all debts,
obligations, liabilities or claims of any and every kind and nature, whether
fixed, accrued, or unmatured, and any reserves or charges, determined in
accordance with generally accepted accounting principles, for any or all
thereof, whether for taxes, including estimated taxes or unrealized book
profits, expenses, contingencies or otherwise).

<PAGE>

In determining the total appraised value of all the property and
assets of the corporation or belonging to any series thereof:

(a) Securities owned shall be valued at market value or, in the
absence of readily available market quotations, at fair value as determined in
good faith by or as directed by the Board of Directors in accordance with
applicable statues and regulations.

(b) Dividends declared but not yet received, or rights in,
respect of securities which are quoted ex-dividend or ex-rights, shall be
included in the value of such securities as determined by or pursuant to the
direction of the Board of Directors on the day the particular securities are
first quoted ex-divided or ex-rights, and on each succeeding day until the said
dividends or rights are received and become part of the assets of the
corporation.

(c) The value of any other assets of the corporation (and any of
the assets mentioned in paragraphs (a) or (b), in the discretion of the Board of
Directors in the event of a national financial emergency, as hereinafter
defined) shall be determined in such manner as may be approved from time to time
by or pursuant to the direction of the Board of Directors.

The net asset value of each share of the Common Stock of the
corporation shall be determined by dividing the total market value of the
property and assets of the relevant series of the corporation by the total
number of shares of its Common Stock then issued and outstanding for such
series, including any shares sold by the corporation up to and including the
date as of which such net asset value is to be determined whether or not
certificates therefor have actually been issued. In case the net asset value of
each share so determined shall include a fraction of one cent, such net asset
value of each share shall be adjusted to the nearest full cent.

For the purposes of these Articles of Incorporation, a "national
financial emergency" is defined as the whole or any part of any period (i)
during which the New York Stock Exchange is closed other than customary weekend
and holiday closings, (ii) during which trading on the New York Stock Exchange
is restricted, (iii) during which an emergency exists as a result of which
disposal by the corporation of securities owned by such series is not reasonably
practicable or it is not reasonably practicable for the corporation fairly to
determine the value of the net assets of such series, or (iv) during any other
period when the Securities and Exchange Commission (or any succeeding
governmental authority) may for the protection of security holders of the
corporation by order permit suspension of the right of redemption or
postponement of the date of payment on redemption; provided that applicable
rules and regulations of the Securities and Exchange Commission (or any

<PAGE>

succeeding governmental authority) shall govern as to whether the conditions
prescribed in (ii), (iii), or (iv) exist. The Board of Directors may, in its
discretion, declare the suspension described in (iv) above at an end, and such
other suspension relating to a natural financial emergency shall terminate as
the case may be on the first business day on which said Stock Exchange shall
have reopened or the period specified in (ii) or (iii) shall have expired (as to
which in the absence of an official ruling by said Commission or succeeding
authority, the determination of the Board of Directors shall be conclusive).

2. To the extent permitted by law, and except in the case of a
national financial emergency, the corporation shall redeem shares of its Common
Stock from its stockholders upon request of the holder thereof received by the
corporation or its designated agent during business hours of any business day,
provided that such request must be accompanied by surrender of outstanding
certificate or certificates for such shares in form for transfer, together with
such proof of the authenticity of signatures as may reasonably be required on
such shares (or, on such request in the event no certificate is outstanding) by,
or pursuant to the direction of the Board of Directors of the corporation, and
accompanied by proper stock transfer stamps. Shares redeemed upon any such
request shall be purchased by the corporation at the net asset value of such
shares determined in the manner provided in Paragraph (1) of this Article
Seventh, as of the close of business day during which such request was received
in good order by the corporation.

Payment for shares of its Common Stock so redeemed by the corporation
shall be made from the assets of the applicable series in cash, except payment
for such shares may, at the option of the Board of Directors, or such officer or
officers as they may duly authorize for the purpose in their complete
discretion, be made from the assets of that series in kind or partially in cash
and partially in kind. In case of any payment in kind the Board of Directors, or
their delegate, shall have absolute discretion as to what security or securities
of such series shall be distributed in kind and the amount of the same; and the
securities shall be valued for purposes of distribution at the value at which
they were appraised in computing the current net asset value of the series of
the Fund's shares, provided that any stockholder who cannot legally acquire
securities so distributed in kind by reason of the prohibitions of the
Investment Company Act of 1940 shall receive cash.

Payment for shares of its Common Stock so redeemed by the corporation
shall be made by the corporation as provided above within seven days after the
date which such shares are deposited; provided, however, that if payment shall
be made by delivery of assets of the corporation, as provided above, any
securities to be delivered as part of such payment shall be delivered as
promptly as any necessary transfers of such securities on the books

<PAGE>

of the several corporations whose securities are to be delivered may be made,
but not necessarily within such seven day period.

The right of any holder of shares of the Common Stock of the
corporation to receive dividends thereon and all other rights of such
stockholder with respect to the shares so redeemed by the corporation shall
cease and determine from and after the time as of which the purchase price of
such shares shall be fixed, as provided above, except the right of such
stockholder to receive payment for such shares as provided for herein.

3. The Board of Directors, may from time to time, without the vote or
consent of stockholders, establish uniform standards with respect to the minimum
net asset value of a stockholder account or a minimum investment which may be
made by a stockholder. The Board of Directors may authorize the closing of those
stockholder accounts not meeting specified minimum standards of net asset value
by redeeming all of the shares in such accounts, provided there is mailed to
each affected stockholder account, at least thirty (3) days prior to the planned
redemption date, a notice setting forth the minimum account size requirement and
the date on which the account will be closed if the minimum size requirement is
not met prior to said closing date.

EIGHTH: Subject to the Investment Company Act of 1940, as amended, each of
the following actions, to the extent required to be approved by the shareholders
under Maryland General Corporation Law, shall be approved by a majority of all
votes entitled to be cast on the matter:

(i) Amendment or amendment and restatement of the Articles

(ii) Reduction of stated capital;

(iii) Consolidation, merger, share exchange or transfer of assets;

(iv) Distribution in partial liquidation; or

(v) Voluntary dissolution.

NINTH: The corporation expressly reserves the right to amend, alter, change
or repeal any provision contained in these Articles of Incorporation, and all
rights, contract and otherwise, conferred herein upon the stockholders are
granted subject to such reservation.

TENTH: The corporation expressly agrees and acknowledges that the name
"Delaware Group Insight Fund" is the sole property of Delaware Management
Company ("DMC"), that similar names are used by funds in the investment

<PAGE>

business which are affiliated with permission of DMC, and that the corporation's
use of such name is with permission of DMC. The corporation further expressly
agrees and acknowledges that its use of such name may be terminated by DMC if
the corporation ceases to use DMC as its investment advisor or Delaware
Distributors, Inc. ("DDI") as its principal underwriter (or to use affiliates of
DMC and DDI for such purposes). The corporation further expressly agrees and
acknowledges that in such event DMC may require the corporation to present to
its shareholders, at the next annual or special meeting of the corporation held
after such request, a proposal to change the name of the corporation to delete
reference to the name "Delaware Group". The corporation further expressly agrees
and acknowledges in such event to use its best efforts to promptly comply with
such request to change its name and that the Board of Directors of the
corporation shall recommend such a proposal to its shareholders. The corporation
further expressly acknowledges and agrees, upon shareholder approval of such a
proposal, to make and cause to be made such filings to effect the change of name
as may be necessary with the State of Maryland, the United States Securities and
Exchange Commission, or other regulatory authorities.

IN WITNESS WHEREOF, the undersigned incorporator of Delaware Group
Insight Fund, Inc. who executed the foregoing Articles of Incorporation hereby
acknowledges the same be to his act and further acknowledges that, to the best
of his knowledge the matters and facts set forth therein are true in all
material respects under the penalties of perjury.

Dated the 14th day of January, 1987

/s/George M. Chamberlain, Jr.
---------------------------------------
George M. Chamberlain, Jr.

<PAGE>

ARTICLES OF AMENDMENT

ARTICLES OF INCORPORATION

DELAWARE GROUP INSIGHT FUND, INC.

DELAWARE GROUP INSIGHT FUND, INC., a Maryland corporation having its
principal office in Baltimore, Maryland (the "Corporation"), hereby certifies to
the State Department of Assessments and Taxation of Maryland, that:

ONE: ARTICLE SECOND of the Article of Incorporation is hereby
amended in its entirety to read as follows:

SECOND: The name of the Corporation is Delaware Group Value Fund,
Inc.

TWO: The Board of Directors of the Corporation on April 16, 1987
duly adopted a resolution setting forth the foregoing amendment to
ARTICLE SECOND of the Articles of Incorporation and declaring said
amendment of the Articles of Incorporation advisable.

THREE: The said amendment to the Articles of Incorporation as
hereinabove set forth has been approved by a majority of the entire
Board of Directors and no stock entitled to be voted on the amendment
is outstanding or subscribed for as of the date hereof.

IN WITNESS WHEREOF, DELAWARE GROUP INSIGHT FUND, INC. has caused
these Articles of Amendment to be signed by its president or vice
president and attested to by its secretary or assistant secretary on
April 16, 1987.

DELAWARE GROUP INSIGHT FUND, INC.

By:/s/John H. Durham
----------------------------
John H. Durham
President

ATTEST:

/s/George M. Chamberlain, Jr.
-----------------------------
George M. Chamberlain, Jr.
Secretary

<PAGE>

THE UNDERSIGNED, JOHN H. DURHAM, President of DELAWARE GROUP
INSIGHT FUND, INC. who executed on behalf of said Corporation the
foregoing Articles of Amendment, of which this certificate is made a
part, hereby acknowledges, in the name and on behalf of said
Corporation, the foregoing Articles of Amendment to be in 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 approval thereof are true in all
material respects, under the penalties of perjury.

/s/John H. Durham
-----------------------
John H. Durham
President

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

ARTICLES SUPPLEMENTARY

ARTICLES OF INCORPORATION

Delaware Group Value Fund, Inc., a Maryland corporation having its
principal office in Baltimore, Maryland (the "Corporation"), hereby certifies,
in accordance with Section 2-208 of the Maryland General Corporation Law, to the
State Department of Assessments and Taxation of Maryland that:

FIRST: The Board of Directors of the Corporation, at a meeting
duly convened and held on January 16, 1992, adopted a resolution designating the
Value Fund (Institutional) class of shares (as distinguished from the existing
Value Fund class of shares) as the second class of Common Stock of Series I of
the Corporation and allocating Fifty Million (50,000,000) shares of authorized,
unissued and unclassified shares of Common Stock of the Corporation, with a par
value of One Cent ($.01) per share, to each class of Series I of the
Corporation.

SECOND: The shares of the Value Fund (Institutional) class and
the Value Fund class shall represent proportionate interests in the same
portfolio of investments of Series I. The shares of the Value Fund
(Institutional) class of Series I of the Corporation shall have the same rights
and privileges, and shall be subject to the same limitations and priorities as
the shares of the Value Fund class of Series I, all as set forth in the Articles
of Incorporation of the Corporation, provided that dividends paid on the shares
of the Value Fund (Institutional) class of shares shall not reflect any
reduction for payment of fees under the Distribution Plan of the Value Fund
class adopted pursuant to Rule 12b-1 under the Investment Company Act of 1940,
as amended, and provided further, that the shares of the Value Fund
(Institutional) class shall not vote upon or with respect to any matter relating
to or arising from any such Distribution Plan.

THIRD: The shares of the Value Fund (Institutional) class and the
Value Fund class of Series I of the Corporation have been classified by the
Board of Directors pursuant to authority contained in the Articles of
Incorporation of the Corporation.

<PAGE>

IN WITNESS WHEREOF, Delaware Group Value Fund, Inc. has caused these
Articles Supplementary to be signed in its name and on its behalf this 22nd day
of May, 1992.

DELAWARE GROUP VALUE FUND, INC.

By:/s/George M. Chamberlain, Jr.
--------------------------------
George M. Chamberlain, Jr.
Vice President

ATTEST:

/s/Eric E. Miller
--------------------
Eric E. Miller
Assistant Secretary

THE UNDERSIGNED, Vice President of DELAWARE GROUP VALUE 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 approval thereof are true in all material respects, under the
penalties of perjury.

/s/George M. Chamberlain, Jr.
--------------------------------
George M. Chamberlain, Jr.

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

ARTICLES SUPPLEMENTARY

ARTICLES OF INCORPORATION

FIRST: The Board of Directors of the Corporation has adopted a
resolution classifying a third class of shares of Common Stock of Series I of
the Corporation as the Value Fund B Class and allocating 150,000,000 shares of
authorized and unissued Common Stock of Series I, par value $0.01 per share, to
the Value Fund B Class (the "B Class").

SECOND: The shares of the B Class shall represent proportionate
interests in the same portfolio of investments as the shares of the Value Fund
(Institutional) class and the Value Fund class of the Corporation. The shares of
the B 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 Value Fund (Institutional) class
and the Value Fund class, all as set forth in the Articles of Incorporation of
the Corporation, except for the differences hereafter set forth:

1. The dividends and distributions of investment income and
capital gains with respect to the B Class of shares of Common Stock 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 Common Stock of the Corporation to reflect differing
allocations of the expenses of the Corporation among the classes and any
resultant difference among the net asset values per share of the 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 three classes of Common Stock of
the Corporation shall be determined by the Board of Directors in a manner that
is consistent with the order, as applicable, dated November 9, 1992 (Investment
Company Act of 1940 Release No. 19086) issued by the Securities and Exchange
Commission, and any future order or any rule or interpretation under the
Investment Company Act of 1940, as amended, that modifies or supersedes such
order;

<PAGE>

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 the B Class shares shall have (i)
exclusive voting rights with respect to any matter submitted to a vote of
stockholders that affects only holders of the B Class shares, 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 the B Class and (ii) no voting rights with respect to the
provision of any Distribution Plan applicable to the existing classes of Common
Stock or with regard to any other matter submitted to a vote of stockholders
which does not affect holders of the B Class shares.

3. (a) Each share of the B Class, other than shares described in
paragraph (3)(b) herein, shall be converted automatically, and without any
action or choice on the part of the holder thereof, into shares of the Value
Fund class on the Conversion Date. The term "Conversion Date" when used herein
shall mean a date set forth in the prospectus of the B Class, as such prospectus
may be amended from time to time, that is no later than three months after
either (i) the date on which the eighth anniversary of the date of issuance of
the share occurs, or (ii) any such other anniversary date as may be determined
by the Board of Directors and set forth in the prospectus of the B Class, as
such prospectus may be amended from time to time; provided that any such other
anniversary date determined by the Board of Directors shall be a date that will
occur prior to the anniversary date set forth in clause (i) and any such other
date theretofore determined by the Board of Directors pursuant to this clause
(ii); but further provided that, subject to the provisions of the next sentence,
for any shares of the B Class acquired through an exchange, or through a series
of exchanges, as permitted by the Corporation as provided in the prospectus of
the B Class, as such prospectus may be amended from time to time, from another
investment company or another series of the Corporation (an "eligible investment
company"), the Conversion Date shall be the conversion date applicable to the
shares of stock of the eligible investment company originally subscribed for in
lieu of the Conversion Date of any stock acquired through exchange if such
eligible investment company issuing the stock originally subscribed for had a
conversion feature, but not later than the Conversion Date determined under (i)
above. For the purpose of calculating the holding period required for
conversion, the date of issuance of a share of the B Class shall mean (i) in the
case of a share of the B Class obtained by the holder thereof through an
original subscription to the Corporation, the date of the issuance of such

<PAGE>

share of the B Class or (ii) in the case of a share of the B Class obtained by
the holder thereof through an exchange, or through a series of exchanges, from
an eligible investment company, the date of issuance of the share of the
eligible investment company to which the holder originally subscribed.

(b) Each share of the B Class (i) purchased through the
automatic reinvestment of a dividend or distribution with respect to the B Class
or the corresponding B Class of any other investment company or any other series
of the Corporation issuing such class of shares or (ii) issued pursuant to an
exchange privilege granted by the Corporation in an exchange or series of
exchanges for shares originally purchased through the automatic reinvestment of
a dividend or distribution with respect to shares of capital stock of an
eligible investment company shall be segregated in a separate sub-account on the
stock records of the Corporation for each of the holders of record thereof. On
any Conversion Date, a number of the shares held in the separate sub-account of
the holder of record of the share of shares being converted, calculated in
accordance with the next following sentence, shall be converted automatically,
and without any action or choice on the part of the holder, into shares of the
Value Fund class. The number of shares in the holder's separate sub-account so
converted shall (i) bear the same ratio to the total number of shares maintained
in the separate sub-account on the Conversion Date (immediately prior to
conversion) as the number of shares of the holder converted on the Conversion
Date pursuant to paragraph (3)(a) hereof bears to the total number of B Class
shares of the holder on the Conversion Date (immediately prior to conversion)
after subtracting the shares then maintained in the holder's separate
sub-account, or (ii) be such other number as may be calculated in such other
manner as may be determined by the Board of Directors and set forth in the
prospectus of the B Class, as such prospectus may be amended from time to time.

(c) The number of shares of the Value Fund class into which
a share of the B Class is converted pursuant to paragraphs 3(a) and 3(b) hereof
shall equal the number (including for this purpose fractions of a share)
obtained by dividing the net asset value per share of the B Class for purposes
of sales and redemption thereof on the Conversion Date by the net asset value
per share of the Value Fund class for purposes of sales and redemption thereof
on the Conversion Date.

(d) On the Conversion Date, the shares of the B Class
converted into shares of the Value Fund class will no longer be deemed
outstanding and the rights of the holders thereof (except the right

<PAGE>

to receive (i) the number of shares of the Value Fund class into which the
shares of the B Class have been converted and (ii) declared but unpaid dividends
to the Conversion Date or such other date set forth in the prospectus of the B
Class, as such prospectus may be amended from time to time and (iii) the right
to vote converting shares of the B Class held as of any record date occurring on
or before the Conversion Date and theretofore set with respect to any meeting
held after the Conversion Date) will cease. Certificates representing shares of
the Value Fund class resulting from the conversion need not be issued until
certificates representing shares of the B Class converted, if issued, have been
received by the Corporation or its agent duly endorsed for transfer.

(e) The automatic conversion of the B Class into the Value
Fund class as set forth in paragraphs 3(a) and 3(b) of this Article SECOND shall
be suspended at any time that the Board of Directors determines (i) that there
is not available a reasonably satisfactory opinion of counsel to the effect that
(x) the assessment of the higher fee under the Distribution Plan with respect to
the B Class does not result in the Corporation's dividends or distributions
constituting a "preferential dividend" under the Internal Revenue Code of 1986,
as amended, and (y) the conversion of the B Class does not constitute a taxable
event under federal income tax law, or (ii) any other condition to conversion
set forth in the prospectus of the B Class, as such prospectus may be amended
from time to time, is not satisfied.

(f) The automatic conversion of the B Class into the Value
Fund class as set forth in paragraphs 3(a) and 3(b) hereof may also be suspended
by action of the Board of Directors at any time that the Board of Directors
determines such suspension to be appropriate in order to comply with, or satisfy
the requirements of the Investment Company Act of 1940, as amended, and in
effect from time to time, or any rule, regulation or order issued thereunder
relating to voting by the holders of the B Class on any Distribution Plan with
respect to the Value Fund class and in effect from time to time, and in
connection with, or in lieu of, any such suspension, the Board of Directors may
provide holders of the B Class with alternative conversion or exchange rights
into other classes of stock of the Corporation in a manner consistent with the
law, rule, regulation or order giving rise to the possible suspension of the
conversion right.

<PAGE>

THIRD: The shares of the B Class have been classified by the Board of
Directors pursuant to authority contained in the Articles of Incorporation of
the Corporation.

IN WITNESS WHEREOF, Delaware Group Value Fund, Inc. has caused these
Articles Supplementary to be signed in its name and on its behalf this 2nd day
of September, 1994.

DELAWARE GROUP VALUE FUND, INC.

By:/s/George M. Chamberlain, Jr.
--------------------------------
George M. Chamberlain, Jr.
Senior Vice President

ATTEST:

/s/Eric E. Miller
--------------------
Eric E. Miller
Assistant Secretary

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

FORM OF ARTICLES SUPPLEMENTARY

ARTICLES OF INCORPORATION

Delaware Group Value Fund, Inc., a Maryland corporation having its
principal office in Baltimore, Maryland (the "Corporation"), hereby certifies,
in accordance with Section 2-208 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 Five Hundred
Million (500,000,000) shares of common stock with a par value of One Cent
($0.01) per share of the Corporation (the "Common Stock"), having an aggregate
par value of Five Million Dollars ($5,000,000). Of such Five Hundred Million
(500,000,000) shares of Common Stock, [Three Hundred Fifty Million
(350,000,000)] shares have been allocated to Series I of the Common Stock as
follows: (1) Fifty Million (50,000,000) shares have been allocated to the Value
Fund (Institutional) class; (2) One Hundred Fifty Million (150,000,000) shares
have been allocated to the Value Fund B class; and (3) One Hundred Fifty Million
(150,000,000) shares have been allocated to the Value Fund class.

SECOND: The Board of Directors of the Corporation, at a meeting held on
July 20, 1995, adopted a resolution classifying a fourth class of shares of
Series I of the Common Stock of the Corporation as the Value Fund C Class (the
"C Class") and reclassifying and allocating Fifty Million (50,000,000) shares of
authorized and unissued Common Stock, previously classified and allocated to the
Value Fund B class of Series I, to the C Class.

THIRD: The shares of the C Class shall represent proportionate interests
in the same portfolio of investments as the shares of the Value Fund
(Institutional) class, Value Fund B class and Value Fund class of Series I 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 Value Fund (Institutional) class, Value Fund B class and Value Fund class of
Series I of the Common Stock, all as set forth in the Articles of Incorporation
of the Corporation, except for the differences hereafter 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

<PAGE>

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
shares of the other classes of Series I 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. Dividends paid
on shares of the C Class shall reflect reductions for payment of fees
under the Distribution Plan relating to shares of the C Class adopted
pursuant to Rule 12b-1 under the Investment Company Act of 1940, as
amended. The allocation of investment income and capital gains and
expenses and liabilities of the Corporation among the four classes of
Series I of the Common Stock of the Corporation shall be determined by
the Board of Directors in a manner that is consistent with the order, as
applicable, dated September 16, 1994 (Investment Company Act of 1940
Release No. 20529) issued by the Securities and Exchange Commission, and
any future order or any Multiple Class Plan adopted 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 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. Shares of the C Class shall not have the right of automatic conversion
into shares of the Value Fund class of Series I of the Common Stock that
has been granted to shares of the Value Fund B class of Series I of the
Common Stock.

-2-

<PAGE>

FOURTH: The shares of the C Class have been classified by the Board of
Directors pursuant to authority contained in the Articles of Incorporation of
the Corporation.

IN WITNESS WHEREOF, Delaware Group Value Fund, Inc. has caused these
Articles Supplementary to be signed in its name and on its behalf this ____ day
of September, 1995.

DELAWARE GROUP VALUE FUND, INC.

By:_____________________________
George M. Chamberlain, Jr.
Senior Vice President

ATTEST:

-------------------------------
Assistant Secretary

-3-

<PAGE>

THE UNDERSIGNED, Senior Vice President of DELAWARE GROUP VALUE
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>

DELAWARE GROUP VALUE FUND, INC.

BY-LAWS

Revised as of May 21, 1987

ARTICLE I
OFFICES

Section 1. The principal office of the Corporation shall be in the City
of Baltimore, State of Maryland. The Corporation shall also have offices at such
other places as the Board of Directors may from time to time determine or the
business of the Corporation may require.

ARTICLE II
STOCKHOLDERS AND STOCK CERTIFICATES

Section 1. Every stockholder of record shall be entitled to a stock
certificate representing the shares owned by him. Stock certificates shall be in
such form as may be required by law and as the Board of Directors shall
prescribe. Every stock certificate shall be signed by the Chairman or the
President or a Vice President and by the Treasurer or an Assistant Treasurer, or
the Secretary or an Assistant Secretary, and sealed with the corporate seal,
which may be a facsimile, either engraved or printed. Stock certificates may
bear the facsimile signatures of the officers authorized to sign such
certificates.

Section 2. Shares of the capital stock of the Corporation shall be
transferable only on the books of the Corporation by the person in whose name
such shares are registered, or by his duly authorized attorney or
representative. In all cases of transfer by an attorney-in-fact, the original
power of attorney, or an official copy thereof duly certified, shall be
deposited and remain with the Corporation or its duly authorized transfer agent.
In case of transfers by executors, administrators, guardians or there legal
representatives, duly authenticated evidence of their authority shall be
produced, and may be required to be deposited and remain with the Corporation or
its duly authorized transfer agent, properly endorsed.

Section 3. Any person desiring a certificate for shares of the capital
stock of the Corporation to be issued in lieu of one lost or destroyed shall
make an affidavit or affirmation setting forth the loss or destruction of such
stock certificate, and shall advertise such loss or destruction in such manner
as the Board of Directors may require, and shall if the Board of Directors shall
so require, give the Corporation a bond or indemnity, in such form and with such

<PAGE>

security as may be satisfactory to the Board, indemnifying the Corporation
against any loss that may result upon the issuance of a new stock certificate.
Upon receipt of such affidavit and proof of publication of the advertisement of
such loss or destruction, and the bond, if any, required by the Board of
Directors, a new stock certificate may be issued of the same tenor and for the
number of shares as the one alleged to have been lost or destroyed.

Section 4. The Corporation shall be entitled to treat the holder of
record of any share or shares of its capital stock as the owner thereof and,
accordingly, shall not be bound to recognize any equitable or other claim to or
interest in such share or shares on the part of any other person, whether or not
the Corporation shall have express or other notice thereof.

ARTICLE III
MEETINGS OF STOCKHOLDERS

Section 1. An annual meeting of the stockholders of the Corporation for
the election of directors and for the transaction of general business shall not
be required to be held in any year except that an annual meeting must be held if
any of the following items is required to be acted upon by shareholders under
the Investment Company Act of 1940: election of directors, approval of the
investment advisory agreement, ratification of the selection of independent
public accountants, or approval of a distribution agreement. Any such meeting
shall be held at the principal office of the Corporation, or at such other place
within or without the State of Maryland as the Board of Directors may from time
to time prescribe, on the third Tuesday in April at 10:00 am. or at such other
date and time as the Board of Directors may from time to time prescribe. A
notice of any change in the place of the annual meeting shall be given to each
stockholder not less than ten days before the election is held.

Section 2. Special meetings of the stockholders may be called at any
time by the Chairman, President or a majority of the members of the Board of
Directors and shall be called by the secretary upon the written request of the
holders of at least twenty-five percent of the shares of the capital stock of
the Corporation issued and outstanding and entitled to vote at such meeting;
provided, if the matter proposed to be acted on is substantially the same as a
matter voted on at any special meeting held during the preceding twelve months,
such written request shall be made by holders of at least a majority of the
capital stock of the Corporation issued and outstanding and entitled

-2-

<PAGE>

to vote at such meetings. Upon receipt of a written request from such holders
entitled to call a special meeting, which shall state the purpose of the meeting
and the matter proposed to be acted on at it, the Secretary shall inform the
holders who made such request of the reasonably estimated cost of preparing and
mailing a notice of a meeting and upon payment of such costs to the Corporation
the Secretary shall issue notice of such meeting. Special meetings of the
stockholders shall be held at the principal office of the Corporation, or at
such other place within or without the State of Maryland as the Board of
Directors may from time to time direct, or at such place within or without the
State of Maryland as shall be specified in the notice of such meeting.

Section 3. Notice of the time and place of the annual or any special
meeting of the stockholders shall be given to each stockholders shall be given
to each stockholder notice of such meeting not less than ten days nor more than
ninety days prior to the date of such meeting. In the case of special meetings
of the stockholders, the notice shall specify the object or objects of such
meeting, and no business shall be transacted at such meeting other than that
mentioned in the call.

Section 4. The Board of Directors may close the stock transfer books of
the Corporation for a period not exceeding twenty days preceding the date of any
meeting of stockholders, or the date for payment of any dividend, or the date
for the allotment of rights, or the date when any change or conversion or
exchange of capital stock shall go into effect, or for a period of not exceeding
twenty days in connection with the obtaining of the consent of stockholders for
any purpose; provided, however, that in lieu of closing the stock transfer books
as aforesaid, the Board of Directors may fix in advance a date, not exceeding
ninety days preceding the date of any meeting of stockholders, or the date for
payment of any dividend, or the date for the allotment of rights, or the date
when any change or conversion or exchange of capital stock shall go into effect,
or a date in connection with obtaining such consent, as a record date for the
determination of the stockholders entitled to notice of, and to vote at any such
meeting and any adjournment thereof, or entitled to receive payment of any such
dividend or to receive such allotment of rights, or to exercise the rights in
respect of any such change, conversion or exchange of capital stock or to give
such consent, and in such case such stockholders and only such stockholders as
shall be stockholders of record on the date so fixed shall be entitled to such
notice of, and to vote at, such meeting and any adjournment thereof, or to
receive payment of such dividend or to receive such allotment of rights or

-3-

<PAGE>

to exercise such rights, or to give such consent, as the case may be,
notwithstanding any transfer of any stock on the books of the Corporation after
any such record date fixed as aforesaid.

Section 5. At all meetings of the stockholders a quorum shall consist
of the holders of a majority of the outstanding shares of the capital stock of
the Corporation entitled to vote at such meeting. In the absence of a quorum no
business shall be transacted except that the stockholders present in person or
by proxy and entitled to vote at such meeting shall have power to adjourn the
meeting from time to time to a date not more than one hundred twenty days after
the original record date without further notice other than announcement at the
meeting. At any such adjourned meeting at which a quorum shall be present any
business day be transacted which might have been transacted at the meeting on
the date specified in the original notice. If a quorum is present at any
meeting, the holders of a majority of the shares of capital stock of the
Corporation issued and outstanding and entitled to vote at the meeting who shall
be present in person or by proxy at such meeting shall have power to approve any
matter properly before the meeting, except a plurality of all votes cast at a
meeting at which a quorum is present shall be sufficient for the election of a
director. The holders of such majority shall also have power to adjourn the
meeting to any specific time or times, and no notice of any such adjourned
meeting need be given to stockholders absent or otherwise.

Section 6. At all meetings of the stockholders the following order of
business shall be substantially observed, as far as it is consistent with the
purpose of the meeting:

Election of Directors;
Ratification of Selection of Auditors;
New business.

Section 7. At any meeting of the stockholders of the Corporation every
stockholder having the right to vote shall be entitled, in person or by proxy
appointed by an instrument in writing subscribed by such stockholder and bearing
a date not more than eleven months prior to said meeting unless such instrument
provides for a longer period, to one vote for each share of stock having voting
power registered in his name on the books of the Corporation.

-4-

<PAGE>

ARTICLE IV
DIRECTORS

Section 1. The Board of Directors shall consist of not less than three
nor more than twelve members. The Board of Directors may by a vote of the entire
board increase or decrease the number of directors without a vote of the
stockholders; provided, that any such decrease shall not affect the tenure of
office of any director. Directors need not hold any shares of the capital stock
of the Corporation.

Section 2. The directors shall be elected by the stockholders of the
Corporation at an annual meeting, if held, or at a special meeting called for
such purpose, and shall hold office until their successors shall be duly elected
and shall qualify.

Section 3. The Board of Directors shall have the control and management
of the business of the Corporation, and in addition to the powers and authority
by these By-Laws expressly conferred upon them, may exercise, subject to the
provisions of the laws of the State of Maryland and of the Articles of
Incorporation of the Corporation, all such powers of the Corporation and do all
such acts and things as are not required by law or by the Articles of
Incorporation to be exercised or done by the stockholders.

Section 4. The Board of Directors shall have power to fill vacancies
occurring on the Board, whether by death, resignation or otherwise. A vacancy on
the Board of Directors resulting from a cause except an increase in the number
of directors may be filled by a vote of the majority of the remaining members of
the Board, though less than a quorum. A vacancy on the Board of Directors
resulting from an increase in the number of directors may be filled by a
majority of the entire Board of Directors. A director elected by the Board of
Directors to fill a vacancy shall serve until the next annual meeting of
stockholders and until his successor is elected and qualifies. If less than a
majority of the directors in office shall have been elected by the stockholders,
a meeting of the stockholders shall be called as required under the Investment
Company Act of 1940, as amended.

Section 5. The Board of Directors shall have power to appoint, and at
its discretion to remove or suspend, any officers, managers, superintendents,
subordinates, assistants, clerks, agents and employees, permanently or
temporarily, as the Board may think fit, and to determine their duties and to
fix, and from time to time to change, their salaries or emoluments, and to
require security in such instances and in such amounts as it may deem proper.

-5-

<PAGE>

Section 6. In case of the absence of an officer of the Corporation, or
for any other reason which may seem sufficient to the Board of Directors, the
Board may delegate his powers and duties for the time being to any other officer
of the Corporation or to any director.

Section 7. The Board of Directors may, by resolution or resolutions
passed by a majority of the whole Board, designate one or more committees, each
committee to consist of two or more of the directors of the Corporation which,
to the extent provided in such resolution or resolutions and by applicable law,
shall have and may exercise the powers of the Board of Directors in the
management of the business and affairs of the Corporation. Such committee or
committees shall have such name or names as may be determined from time to time
by resolution adopted by the Board of Directors. Any such committee shall keep
regular minutes of its proceedings, and shall report the same to the Board when
required.

Section 8. The Board of Directors may held their meetings and keep the
books of the Corporation, except the original or a duplicate stock ledger and
the original or a certified copy of these By-Laws, outside of the State of
Maryland, at such place or places as they may from time to time determine.

Section 9. The Board of Directors shall have power to fix, and from
time to time to change the compensation, if any, of the directors of the
Corporation.

Section 10. Upon retirement of a Director, the Board may elect him or
her to the position of Director Emeritus. Said Director Emeritus shall serve for
one year and may be re-elected by the Board from year to year thereafter. Said
Director Emeritus shall not vote at meetings of Directors and shall not be held
responsible for actions of the Board but shall receive fees paid to Board
members for serving as such.

ARTICLE V
DIRECTORS MEETINGS

Section 1. The first regular meeting of the Board of Directors shall be
held each year within seven business days following the annual meeting of
stockholders at which the Directors are elected. Regular meetings of the Board
of Directors shall also be held without notice at such times and places as may
be from time to time prescribed by the Board.

Section 2. Special meetings of the Board of Directors may be called at
any time by the Chairman, and shall be called by the Chairman upon the written
request of a majority of the members of the Board of Directors.

-6-

<PAGE>

Unless notice is waived by all the members of the Board of Directors, notice of
any special meeting shall be given to each director at least twenty-four hours
prior to the date of such meeting, and such notice shall provide the time and
place of such special meetings.

Section 3. One-third of the entire Board of Directors shall constitute
a quorum for the transaction of business at any meeting; except that if the
number of directors on the Board is less than six, two members shall constitute
a quorum for the transaction of business at any meeting. The act of a majority
of the directors present at any meeting where there is a quorum shall be the act
of the Board of Directors except as may be otherwise required by Maryland law or
the Investment Company Act of 1940.

Section 4. The order of business at meetings of the Board of Directors
shall be prescribed from time to time by the Board.

ARTICLE VI
OFFICERS AND AGENTS

Section 1. At the first meeting of the Board of Directors after the
election of Directors in each year, the Board shall elect a Chairman, a
President and Chief Executive Officer, one or more Vice Presidents, a Secretary
and a Treasurer and may elect or appoint one or more Assistant Secretaries, one
or more Assistant Treasurers, and such other officers and agents as the Board
may deem necessary and as the business of the Corporation may require.

Section 2. The Chairman of the Board and the President shall be elected
from the membership of the Board of Directors, but other officers need not be
members of the Board of Directors. Any two or more offices may be held by the
same person except the offices of President and Vice President. All officers of
the Corporation shall serve for one year and until their successors shall have
been duly elected and shall have qualified; provided, however, that any officer
may be remove at any time, either with or without cause, by action by the Board
of Directors.

ARTICLE VII
DUTIES OF OFFICERS
CHAIRMAN OF THE BOARD

Section 1. The Chairman of the Board shall preside at all meetings of
the stockholders and the Board of Directors and shall be a member ex officio

-7-

<PAGE>

of all standing committees. He shall have those duties and responsibilities as
shall be assigned to him by the Board of Directors. In the absence, resignation,
disability or death of the President, the Chairman shall exercise all the powers
and perform all the duties of the President until his return, or until such
disability shall be removed or until a new President shall have been elected.

PRESIDENT

Section 2. The President shall be the Chief Executive Officer and head
of the Corporation, and in the recess of the Board of Directors shall have the
general control and management of its business and affairs, subject, however to
the regulations of the Board of Directors.

The President shall in the absence of the Chairman, preside
at all meetings of the stockholders and the Board of Directors. In the event of
the absence, resignation, disability or death of the Chairman, the President
shall exercise all powers and perform all duties of the Chairman until his
return, or until such disability shall have been received or until a new
Chairman shall have been elected.

VICE PRESIDENTS

Section 3. The Executive Vice President, and the Vice Presidents, shall
have those duties and responsibilities as shall be assigned to them by the
Chairman or the President. In the event of the absence, resignation, disability
or death of the Chairman and President, the Executive Vice President shall
exercise all the powers and perform all the duties of the President until his
return, or until such disability shall be removed or until a new President shall
have been elected.

THE SECRETARY AND ASSISTANT SECRETARIES

Section 4. The Secretary shall attend all meetings of the stockholders
and shall record all the proceedings thereof in a book to be kept for that
purpose, and he shall be the custodian of the corporate seal of the Corporation.
In the absence of the Secretary, an Assistant Secretary or any other person
appointed or elected by the Board of Directors, as is elsewhere in these By-laws
provided, may exercise the rights and perform the duties of the Secretary.

-8-

<PAGE>

Section 5. The Assistant Secretary, or, if there be more than one
Assistant Secretary, then the Assistant Secretaries in the order of their
seniority, shall, in the absence or disability of the Secretary, perform the
duties and exercise the powers of the secretary. Any Assistant Secretary elected
by the Board shall also perform such other duties and exercise such the powers
as the Board of Directors shall from time to time prescribe.

THE TREASURER AND ASSISTANT TREASURERS

Section 6. The Treasurer shall keep full and correct accounts of the
receipts and expenditures of the Corporation in books belonging to the
Corporation, and shall deposit all monies and valuable effects in the name and
to the credit of the Corporation and in such depositories as may be designated
by the Board of Directors, and shall, if the Board shall so direct, give bond
with sufficient security and in such amount as may be required by the Board of
Directors for the faithful performance of his duties.

He shall disburse funds of the Corporation as may be ordered
by the Board of Directors, taking proper vouchers for such disbursements, and
shall render to the President and Board of Directors at the regular meetings of
the Board, or whenever they may require it, an account of all his transactions
as the chief fiscal officer of the Corporation and of the financial condition of
the Corporation, and shall present each year before the annual meeting of the
stockholders a full financial report of the preceding fiscal year.

Section 7. The Assistant Treasurer, or, if there be more than one
Assistant Treasurer, then the Assistant Treasurers in the order of their
seniority, shall, in the absence or disability of the Treasurer, perform the
duties and exercise the powers of the Treasurer. Any Assistant Treasurer elected
by the board shall also perform such duties and exercise such powers as the
Board of Directors shall from time to time prescribe.

ARTICLE VIII
CHECKS, DRAFTS, NOTES, ETC.

Section 1. All checks shall bear the signature of such person or
persons as the Board of Directors may from time to time direct.

Section 2. All notes and other similar obligations and acceptances of
drafts by the Corporation shall be signed by such person or persons as the Board
of Directors may from time to time direct.

-9-

<PAGE>

Section 3. Any officer of the Corporation or any other employee, as the
Board of Directors may from time to time direct, shall have full power to
endorse for deposit all checks and all negotiable paper drawn payable to his or
their order or the order of the Corporation.

ARTICLE IX
CORPORATE SEAL

Section 1. The corporate seal of the Corporation shall have inscribed
thereon the name of the Corporation, the year of its organization, and the words
"Corporate Seal, Maryland." Such seal may be used by causing it or a facsimile
thereof to be impressed or affixed or otherwise reproduced.

ARTICLE X
DIVIDENDS

Section 1. Dividends upon the shares of the capital stock of the
Corporation may, subject to the provisions of the Articles of Incorporation of
the Corporation, if any, be declared by the Board of Directors at any regular or
special meeting, pursuant to law. Dividends may be paid in cash, in property, or
in shares of the capital stock of the Corporation.

Section 2. Before payment of any dividend there may be set aside out of
any funds of the Corporation available for dividends such sum or sums as the
Board of Directors may, from time to time, in their absolute discretion, think
proper as a reserve fund to meet contingencies, or for equalizing dividends, or
for repairing or maintaining any property of the Corporation, or for such other
purpose as the Board of Directors shall deem to be for the best interests of the
Corporation, and the Board of Directors may abolish any such reserve in the
manner in which it was created.

ARTICLE XI
FISCAL YEAR

Section 1. The fiscal year of the Corporation shall begin on December l
of each year, and end on November 30 of each year.

-10-

<PAGE>

ARTICLE XII
NOTICES

Section 1. Whenever under the provisions of these By-Laws notice is
required to be given to any director or stockholder, such notice is deemed given
when it is personally delivered, left at the residence or usual place of
business of the director or stockholder, or mailed to such director or
stockholder at such address as shall appear on the books of the Corporation and
such notice, if mailed, shall be deemed to be given at the time it shall be so
deposited in the United States mail postage prepaid. In the case of directors,
such notice may also be given orally by telephone or by telegraph or cable.

Section 2. Any notice required to be given under these By-laws may be
waived in writing, signed by the person or persons entitled to such notice,
whether before or after the time stated therein.

ARTICLE XIII
AMENDMENTS

Section 1. These By-Laws may be amended, altered or repealed by the
affirmative vote of the holders of a majority of the shares of capital stock of
the Corporation issued and outstanding and entitled to vote thereon, or by a
majority of the Board of Directors, as the case may be.

-11-

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

CERTIFICATION OF AMENDMENT TO BY-LAWS

ARTICLE 3, SECTION 2

JUNE 16, 1988

The Undersigned Secretary of Delaware Group Value Fund, Inc. does
hereby certify that the Board of Directors of the Fund at a meeting duly called
and held on June 16, 1988 did adopt the following resolution amending Article 3,
Section 2 of the Fund's by-laws:

RESOLVED, that Article III, Section 2 of the Bylaws of the Fund be
amended to read as follows:

Section 2. Special meetings of the stockholders may be called at any
time by the Chairman, President or a majority of the members of the
Board of Directors and shall be called by the Secretary upon the
written request of the holders of at least twenty-five percent of the
shares of the capital stock of the Corporation issued and outstanding
and entitled to vote at such meeting; provided, if the matter proposed
to be acted on is substantially the same as a matter voted on at any
special meeting held during the preceding twelve months, such written
request shall be made by holders of at least a majority of the capital
stock of the Corporation issued and outstanding and entitled to vote at
such meetings. A special meeting of the stockholders shall also be
called by the Secretary upon the written request of at least ten
percent of the shares of the capital stock of the Corporation issued
and outstanding and entitled to vote at such meeting, for the express
purpose of voting upon the question of removal of a director or
directors. Upon receipt of a written request from such holders entitled
to call a special meeting, which shall state the purpose of the meeting
and the matter proposed to be acted on at it, the Secretary shall
inform the holders who made such request of the reasonably estimated
cost of preparing and mailing a notice of a meeting and upon payment of
such costs to the Corporation the Secretary shall issue notice of such
meeting. Special meetings of the stockholders shall be held at the
principal office of the Corporation, or at such other place within or
without the State of Maryland as the Board of Directors may from time
to time direct, or at such place within or without the State of
Maryland as shall be specified in the notice of such meeting.

<PAGE>

IN WITNESS WHEREOF, I have hereto subscribed my name this 16th day of
June, 1988.

/s/George M. Chamberlain, Jr.
-----------------------------
George M. Chamberlain, Jr.
Secretary

-13-

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

CERTIFICATION OF AMENDMENT TO BY-LAWS

INSERTING A NEW ARTICLE VII AND RENUMBERING THE SUBSEQUENT
ARTICLES

FEBRUARY 16, 1989

The Undersigned Secretary of Delaware Group Value Fund, Inc. does
hereby certify that the Board of Directors of the Fund at a meeting duly called
and held on February 16, 1989 did adopt the following resolutions inserting a
new Article VII and renumbering the subsequent articles of the Fund's by-laws:

WHEREAS, the Board of Directors of the Fund deems it to be in
the best interests of the Fund to amend the By-Laws of the Fund to
allow indemnification of officers and directors to the full extent
provided by Maryland law;

NOW THEREFORE, BE IT RESOLVED, that the By-Laws of the Fund
are hereby amended by renumbering ARTICLES VIII, IX, X, XI, XII AND XIII as
ARTICLES IX, X, XI, XII, XIII AND XIV, and by inserting as ARTICLE VII, the
following:

"INDEMNIFICATION OF OFFICERS AND DIRECTORS

Section 1. The Corporation shall indemnify each
Officer and Director made party to a proceeding, by reason of
service in such capacity, to the fullest extent, and in the
manner provided, under Section 2-418 of the Maryland General
Corporation Law: (i) unless it is proved that the person
seeking indemnification did not meet the standard of conduct
set forth in subsection (b)(1) of such section; and (ii)
provided, that the Corporation shall not indemnify any Officer
or Director for any liability to the Corporation or its
security holders arising from the wilful misfeasance, bad
faith, gross negligence or reckless disregard of the duties
involved in the conduct of such person's office.

Section 2. The provisions of clause (i) of Section 1
herein notwithstanding, the Corporation shall indemnify each
Officer and Director against reasonable expenses incurred in
connection with the successful defense of any proceeding to
which each such Officer or Director is a party by reason of
service in such capacity.

-14-

<PAGE>

Section 3. The Corporation, in the manner and to the
extent provided by applicable law, shall advance to each
Officer and Director who is made party to a proceeding by
reason of service in such capacity the reasonable expenses
incurred by such person in connection therewith."

IN WITNESS WHEREOF, I have hereto subscribed my name this 16th
day of February, 1989.

/s/George M. Chamberlain, Jr.
------------------------------
George M. Chamberlain, Jr.
Secretary

-15-

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

CERTIFICATION OF AMENDMENT TO BY-LAWS

AMENDING SECTION 2 OF ARTICLE VI

NOVEMBER 21, 1991

The Undersigned secretary of Delaware Group Value Fund, Inc. does
hereby certify that at the Board of Directors of the Fund at a meeting duly
called and held on November 21, 1991 did adopt the following resolution amending
Section 2 of Article VI of the Fund's by-laws:

RESOLVED, that Article VI, section 2 of the Fund's bylaws be amended to
read in its entirely as follows:

Section 2. The Chairman of the Board shall be elected
from the membership of the Board of Directors, but other
officers need not be members of the Board of Directors. Any
two or more offices may be held by the same person except the
offices of President and Vice President. All officers of the
Corporation shall serve for one year and until their
successors shall have been duly elected and shall have
qualified; provided, however, that any officer may be removed
at any time, either with or without cause, by action by the
Board of Directors.

AND FURTHER RESOLVED, that the appropriate officers of the Fund are
hereby authorized to take such other steps as may be necessary to
implement the aforesaid amendment.

IN WITNESS WHEREOF, I have hereto subscribed my name this 21st day of
November, 1991.

/s/George M. Chamberlain, Jr.
-----------------------------
George M. Chamberlain, Jr.

-16-

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

CERTIFICATION OF AMENDMENT TO BY-LAWS

AMENDING SECTION 8 OF ARTICLE IV

JULY 22, 1991

The Undersigned Secretary of Delaware Group Value Fund, Inc. does
hereby certify that at the Board of Directors of the Fund at a meeting duly
called and held on July 22, 1991 did adopt the following resolution amending
Section 8 of Article IV of the Fund's by-laws:

RESOLVED, that Article IV, Section 8, be amended in its entirely to
read as follows:

Section 8. The Board of Directors may hold their
meetings and keep the books of the Corporation outside of the
State of Maryland at such place or places as it may from time
to time determine.

AND FURTHER RESOLVED, that the Secretary of the Fund is hereby
authorized and directed to include a certified copy of this Amendment
with the corporate records of the Fund; and further

RESOLVED, that the books and records of the Fund shall be maintained at
the offices of the Fund in the City of Philadelphia.

IN WITNESS WHEREOF, I have hereto subscribed my name this 22nd day of
July, 1991.

/s/George M. Chamberlain, Jr.
------------------------------
George M. Chamberlain, Jr.

-17-

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

CERTIFICATION OF AMENDMENT TO BY-LAWS

AMENDING SECTION 2 OF ARTICLE III

JANUARY 17, 1991

The Undersigned Secretary of Delaware Group Value Fund, Inc. does
hereby certify that at the Board of Directors of the Fund at a meeting duly
called and held on January 17, 1991 did adopt the following resolution amending
Section 2 of ARTICLE III of the Fund's by-laws:

WHEREAS, the Board of Directors of the Fund deems it to be in the best
interests of the Fund to amend the By-Laws of the Fund to provide that
holders of at least 1O% of the Fund's shares be permitted, at the
Fund's cost, to call a special stockholders meeting for any purpose, in
order to enable the Fund's shares to be qualified and sold in the State
of California; and therefore be it

RESOLVED, that the By-Laws of the Fund are hereby amended by inserting,
as amended Section 2 of ARTICLE III, the following:

<PAGE>

within or without the State of Maryland as the Board of
Directors may from time to time direct, or at such place
within or without the State of Maryland as shall be specified
in the notice of such meeting.

IN WITNESS WHEREOF, I have hereto subscribed my name this 17th
day of January, 1991.

/s/George M. Chamberlain, Jr.
------------------------------
George M. Chamberlain, Jr.

-2-

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

CERTIFICATION OF AMENDMENT TO BY-LAWS

AMENDING SECTION 7 OF ARTICLE III

JANUARY 28, 1995

The Undersigned Secretary of Delaware Group Value Fund, Inc. does
hereby certify that at the Board of Directors of the Fund at a meeting duly
called and held on January 28, 1995 did adopt the following resolution amending
Section 7 of Article III of the Fund's by-laws:

RESOLVED, that Article III, Section 7, be amended in its entirely to
read as follows:

Section 7. At any meeting of the stockholders of the
Corporation every stockholder having the right to vote shall
be entitled, in person or by proxy appointed by an instrument
in writing subscribed by such stockholder or by his duly
authorized attorney-in-fact and bearing a date not more than
eleven months prior to said meeting unless such instrument
provides for a longer period, to one vote for each share of
stock having voting power registered in his name on the books
of the Corporation.

IN WITNESS WHEREOF, I have hereto subscribed my name this 28th day of
January, 1995.

/s/George M. Chamberlain, Jr.
------------------------------
George M. Chamberlain, Jr.
Secretary

-3-

<PAGE>

DELAWARE GROUP VALUE FUND, INC.

INVESTMENT MANAGEMENT AGREEMENT

AGREEMENT, made by and between DELAWARE GROUP VALUE FUND, INC., a
Maryland corporation (the "Fund"), for SERIES I (the "Series"), and DELAWARE
MANAGEMENT COMPANY, INC., a Delaware corporation (the "Investment Manager").

W I T N E S S E T H:

WHEREAS, the Fund has been organized and operates as an
investment company registered under the Investment Company Act of 1940 and
engages in the business of investing and reinvesting its assets in securities;
and

WHEREAS, the Investment Manager is a registered Investment
Adviser under the Investment Advisers Act of 1940 and engages in the business of
providing investment management services; and

WHEREAS, the indirect parent company of the Investment Manager
completed on the date of this Agreement a merger transaction which resulted in a
change of control of the Investment Manager and an automatic termination of the
previous Investment Management Agreement dated as of the 29th day of June, 1988;
and

WHEREAS, the Board of Directors of the Fund and shareholders
of the Series have determined to enter into a new Investment Management
Agreement with the Investment Manager to be effective as of the date hereof.

NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and each of the parties hereto intending to be legally bound, it is
agreed as follows:

1. The Fund hereby employs the Investment Manager to manage the
investment and reinvestment of the Series' assets and to administer its affairs,
subject to the direction of the Board and officers of the Fund for the period
and on the terms hereinafter set forth. The Investment Manager hereby accepts
such employment and agrees during such period to render the services and assume
the obligations herein set forth for the compensation herein provided. The
Investment Manager shall, for all purposes herein, be deemed to be an
independent contractor, and shall, unless otherwise expressly provided and
authorized, have no authority to act for or represent the Fund in any way, or in
any way be deemed an agent of the Fund. The Investment Manager shall regularly
make decisions as to what securities to purchase and sell on behalf of the
Series and shall give written instructions to the Trading Department maintained
by the Fund for implementation of such decisions and shall furnish the Board of
Directors of the Fund with such information and reports regarding the Series'
investments as the Investment Manager deems appropriate or as the Directors of
the Fund may reasonably request.

<PAGE>

2. The Fund shall conduct its own business and affairs and shall bear
the expenses and salaries necessary and incidental thereto including, but not in
limitation of the foregoing, the costs incurred in: the maintenance of its
corporate existence; the maintenance of its own books, records and procedures;
dealing with its own shareholders; the payment of dividends; transfer of stock,
including issuance, redemption and repurchase of shares; preparation of share
certificates; reports and notices to shareholders; calling and holding of
shareholders' meetings; miscellaneous office expenses; brokerage commissions;
custodian fees; legal and accounting fees; and taxes. The Fund shall bear all of
its own organizational costs.

Directors, officers and employees of the Investment Manager
may be directors, officers and employees of the funds of which Delaware
Management Company, Inc. is Investment Manager. Directors, officers and
employees of the Investment Manager who are directors, officers and/or employees
of the Fund shall not receive any compensation from the funds for acting in such
dual capacity.

In the conduct of the respective businesses of the parties hereto and
in the performance of this Agreement, the Fund and Investment Manager may share
facilities common to each, with appropriate proration of expenses between them.

3. (a) The Fund shall place and execute its own orders for the
purchase and sale of portfolio securities with broker/dealers. Subject to the
primary objective of obtaining the best available prices and execution, the Fund
will place orders for the purchase and sale of portfolio securities with such
broker/dealers selected from among those designated from time to time by the
Investment Manager, who provide statistical, factual and financial information
and services to the Fund, to the Investment Manager, or to any other fund for
which the Investment Manager provides investment advisory services and/or with
broker/dealers who sell shares of the Fund or who sell shares of any other fund
for which the Investment Manager provides investment advisory services.
Broker/dealers who sell shares of the funds of which Delaware Management
Company, Inc. is Investment Manager, shall only receive orders for the purchase
or sale of portfolio securities to the extent that the placing of such orders is
in compliance with the Rules of the Securities and Exchange Commission and the
National Association of Securities Dealers, Inc.

(b) Notwithstanding the provisions of subparagraph (a) above and
subject to such policies and procedures as may be adopted by the Board of
Directors and officers of the Fund, the Investment Manager may ask the Fund, and
the Fund may agree, to pay a member of an exchange, broker or dealer, an amount
of commission for effecting a securities transaction in excess of the amount of
commission another member of an exchange, broker or dealer would have charged
for effecting that transaction, in such instances where it, and the Investment
Manager, have determined in good faith that such amount of commission was
reasonable in relation to the value of the brokerage and research services

-2-

<PAGE>

provided by such member, broker or dealer, viewed in terms of either that
particular transaction or the Investment Manager's overall responsibilities with
respect to the Fund and to other funds for which the Investment Manager
exercises investment discretion.

4. As compensation for the services to be rendered to the Fund by the
Investment Manager under the provisions of this Agreement, the Fund shall pay to
the Investment Manager monthly from the Series' assets a fee equal to
one-sixteenth of one percent (the equivalent of three-quarters of one percent
per annum) of the daily average net assets of the Series during the month, less
the Series' proportionate part of all fees paid to members of the Board of
Directors of the Fund during the same period based on the number of publicly
offered series of the Fund.

If this Agreement is terminated prior to the end of any calendar
month, the management fee shall be prorated for the portion of any month in
which this Agreement is in effect according to the proportion which the number
of calendar days during which the Agreement is in effect bears to the number of
calendar days in the month, and shall be payable within l0 days after the date
of termination.

5. The services to be rendered by the Investment Manager to the Fund
under the provisions of this Agreement are not to be deemed to be exclusive, and
the Investment Manager shall be free to render similar or different services to
others so long as its ability to render the services provided for in this
Agreement shall not be impaired thereby.

6. The Investment Manager, its directors, officers, employees, agents
and shareholders may engage in other businesses, may render investment advisory
services to other investment companies, or to any other corporation,
association, firm or individual, and may render underwriting services to the
Fund or to any other investment company, corporation, association, firm or
individual.

7. In the absence of willful misfeasance, bad faith, gross negligence,
or a reckless disregard of the performance of duties of the Investment Manager
to the Fund, the Investment Manager shall not be subject to liabilities to the
Fund or to any shareholder of the Fund for any action or omission in the course
of, or connected with, rendering services hereunder or for any losses that may
be sustained in the purchase, holding or sale of any security, or otherwise.

8. This Agreement shall be executed and become effective as of the
date written below if approved by the vote of a majority of the outstanding
voting securities of the Series. It shall continue in effect for a period of two
years from the date of execution of this Agreement, and may be renewed
thereafter only so long as such renewal and continuance is specifically
approved, at least annually, by the Board of Directors or by vote of a majority
of the outstanding voting securities of the Series and only if the

-3-

<PAGE>

terms and the renewal hereof have been approved by the vote of a majority of the
Directors 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. No amendment to this Agreement shall be effective unless the terms
thereof have been approved by the vote of a majority of the outstanding voting
securities of the Series and by the vote of a majority of Directors of the Fund
who are not parties to the Agreement or interested persons of any such party,
cast in person at a meeting called for the purpose of voting on such approval.
Notwithstanding the foregoing, this Agreement may be terminated by the Fund at
any time, without the payment of a penalty, on sixty days' written notice to the
Investment Manager of the Fund's intention to do so, pursuant to action by the
Board of Directors of the Fund or pursuant to vote of a majority of the
outstanding voting securities of the Series. The Investment Manager may
terminate this Agreement at any time, without the payment of penalty, on sixty
days' written notice to the Fund of its intention to do so. Upon termination of
this Agreement, the obligations of all the parties hereunder shall cease and
terminate as of the date of such termination, except for any obligation to
respond for a breach of this Agreement committed prior to such termination, and
except for the obligation of the Fund to pay to the Investment Manager the fee
provided in Paragraph 4 hereof, prorated to the date of termination. This
Agreement shall automatically terminate in the event of its assignment.

9. This Agreement shall extend to and bind the heirs, executors,
administrators and successors of the parties hereto.

l0. For the purposes of this Agreement, the terms "vote of a majority
of the outstanding voting securities"; "interested persons"; and "assignment"
shall have the meanings defined in the Investment Company Act of l940.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement by
having it signed by their duly authorized officers as of the 3rd day of April,
1995.

DELAWARE GROUP VALUE FUND, INC.
FOR SERIES I

Attest: /s/Eric E. Miller By: /s/Brian F. Wruble
--------------------- ----------------------------
Eric E. Miller Brian F. Wruble

DELAWARE MANAGEMENT COMPANY, INC.

Attest: /s/Richelle S. Maestro By: /s/Wayne A. Stork
--------------------- ----------------------------
Richelle S. Maestro Wayne A. Stork

-4-

<PAGE>

DELAWARE
GROUP Dealer's Agreement
========

---------------------------------------------------------------------------

We invite you, as a selected dealer, to participate as principal in the
distribution of the shares 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, right of
accumulation, combined purchases privilege, exchange and reinvestment
privileges and 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 of 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.

<PAGE>

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 five
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 a specific request is received from
the purchaser. Certificates, if requested, will be issued in the names indicated
by registration instructions accompanying your payment.

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 has a Distribution Plan under Rule
12b-1 (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 and services and assistance to your customers
who own Fund shares, including but not limited to, answering inquiries
regarding the Fund or the status of a customer's account, assisting in
changing dividend options, account designations and addresses and providing
information to customers relating to maintaining their investment in the
Fund. 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; provided, however, that no payments shall be due
and paid to you hereunder unless and until the form of this Agreement shall
have been approved by a majority of the Board of Directors or Trustees of the
Fund and by a majority of the directors or trustees who are not "interested
persons" of us, the Fund or its investment manager, as such term is defined
in the 1940 Act (i.e., non-interested directors or trustees) by vote cast in
person at a meeting called for the purpose of voting on this form of
Agreement. The 12b-1 Plans in effect on the date of this Agreement are
substantially in the form set forth as Exhibit A hereto. 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 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.

<PAGE>

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 publicly 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 NASD and SEC as
required. 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 ter mination
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. Additional or modified forms
of Rule 12b-1 Plans may be included in this Agreement from time to time.

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 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

<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>

EXHIBIT A-1
FORM OF 12b-1 PLANS
A CLASS AND CONSULTANT CLASS SHARES

The 12b-1 Plans adopted by Funds in the Delaware Group
offering A Class Shares that are subject to a front-end sales
charge or Consultant Class Shares (money market funds) are
substantially in the following form:

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_______________ Class ("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 also 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 organized under the laws of the State of Maryland
authorized to issue different series 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 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 Distributor may enter into agreements with other registered
broker/dealers substantially in the form of the Dealer Agreement in the
implementation of this Plan and of the Distribution Agreement between it and
the Fund. The Fund may, in addition, enter into arrangements with other than
broker/dealers which are not "affiliated persons" or "interested persons" of
the Fund, DMC, Delaware International, or the Distributor to provide to the
Fund services in the Fund's marketing of shares of the Class, such
arrangements to be reflected by Service Agreements.

The Plan provides that:

1. The Fund shall pay a monthly fee not to exceed 0.3% (3/10 of 1%) per annum
of the Fund's average daily net assets represented by shares of the Class
(the "Maximum Amount") as may be determined by the Fund's Board of Directors
from time to time. Such monthly fee shall be reduced by the aggregate sums
paid by the Fund to 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 1
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: (1) 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
Service Agreement and the Plan; both the Distributor and the Service
Providers 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 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 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 on the date on which the Class commences
operations with public shareholders ("Commencement Date"); thereafter, it
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. The Distribution Agreement between the Fund and the Distributor, and the
Service Agreements between the Fund 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 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 shall be committed to the discretion of such
non-interested directors.

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 purposes of this Plan.

<PAGE>

Exhibit A-2

FORM OF 12b-1 PLANS

B CLASS SHARES

The 12b-1 Plans adopted by the Funds in the Delaware Group
offering B Class Shares are substantially in the following form:

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 B 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 organized under the laws of the State of Maryland,
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 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, the forms of which
have been approved from time to time by the Fund's Board of Directors.

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 Fund.

<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 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.

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. The Distribution Agreement between the Fund and the Distributor, and any
dealers or servicing agreements between the Distributor and brokers or others
or between the Fund 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 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 shall be committed to the discretion of such
non-interested Directors.

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.

AA-17A-1/95-U

<PAGE>

PROFIT SHARING PLAN

DELAWARE GROUP DELAWARE FUND, INC.

SECOND AMENDMENT AND RESTATEMENT
EFFECTIVE APRIL 1, 1989

<PAGE>

PROFIT SHARING PLAN
OF
DELAWARE GROUP DELAWARE FUND, INC.

SECOND AMENDMENT AND RESTATEMENT
EFFECTIVE APRIL 1, 1989

TABLE OF CONTENTS
-----------------
PAGE
----
ARTICLE I
PURPOSE CLAUSE . . . . . . . . . . . . . . . . . . . . 1

ARTICLE II
DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . 1

ARTICLE III
ELIGIBILITY OF EMPLOYEES
TO PARTICIPATE IN THE PLAN . . . . . . . . . . . . . . 6

ARTICLE IV
CONTRIBUTIONS TO PLAN . . . . . . . . . . . . . . . . . 7

ARTICLE V
ALLOCATION OF CONTRIBUTIONS . . . . . . . . . . . . . . 12

ARTICLE VI
RETIREMENT BENEFITS . . . . . . . . . . . . . . . . . . 14

ARTICLE VII
DISABILITY BENEFITS . . . . . . . . . . . . . . . . . . 14

ARTICLE VIII
DEATH BENEFITS . . . . . . . . . . . . . . . . . . . . 14

ARTICLE IX
OTHER SEPARATION FROM SERVICE . . . . . . . . . . . . . 16

ARTICLE X
METHOD OF PAYMENT . . . . . . . . . . . . . . . . . . . 18

ARTICLE XI
ADMINISTRATION OF PLAN . . . . . . . . . . . . . . . . 26

ARTICLE XII
AMENDMENT, CONSOLIDATION, MERGER
OR TERMINATION . . . . . . . . . . . . . . . . . . . . 29

(i)

<PAGE>

ARTICLE XIII
MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . 30

ARTICLE XIV
LOANS . . . . . . . . . . . . . . . . . . . . . . . . . 31

ARTICLE XV
LIMITATIONS ON ALLOCATIONS . . . . . . . . . . . . . . 32

ARTICLE XVI
TOP HEAVY DEFINITIONS AND RULES . . . . . . . . . . . . 36

(ii)

<PAGE>

PROFIT SHARING PLAN
OF
DELAWARE GROUP DELAWARE FUND, INC.
SECOND AMENDMENT AND RESTATEMENT
EFFECTIVE APRIL 1, 1989

ARTICLE I

PURPOSE CLAUSE
--------------
This Profit Sharing Plan and the Trust Agreement forming a part hereof are
established for the benefit of the employees of Delaware Group Delaware Fund,
Inc. and the other investment companies of the Delaware Group of Funds to
promote in them a strong interest in the successful operation of the business
and to provide for them an opportunity for accumulation of funds for their
retirement benefit.

ARTICLE II

DEFINITIONS
-----------
When used herein, the following words shall have the following meanings
unless the context clearly indicates otherwise:

2.1 "Administrative Committee" or "Committee" shall mean the Administrative
Committee with authority and responsibility to manage and direct the operation
and administration of this Plan. "Administrative Committee" shall be deemed to
also mean "Administrator" and "Plan Administrator" as defined in ERISA.

2.2 "Anniversary Date" shall mean the first day of each Plan Year.

2.3 "Beneficiary" shall mean the person or persons designated by a
Participant to receive benefits upon the death of said Participant pursuant to
Article VIII.

2.4 "Board of Directors" shall mean the Board of Directors of the Employer.

2.5 "Code" shall mean the Internal Revenue Code of 1986, as amended.

2.6 "Effective Date" of the Plan shall mean October 1, 1983. The Effective
Date of this amended and restated Plan shall mean April 1, 1989, except where
indicated otherwise.

2.7 "Eligibility Computation Period" shall mean the period of twelve (12)

-4-

<PAGE>

consecutive months beginning on the date an Employee first performs an Hour of
Service upon hire or rehire after a One Year Break in Service, and any Plan Year
following such date of hire or date of rehire following a One Year Break in
Service.

2.8 "Eligibility Year of Service" shall mean the Eligibility Computation
Period during which the Employee performs one thousand (1,000) or more Hours of
Service. Eligibility Years of Service shall include an Employee's prior service
with Delaware Management Company, Inc. or any Entity required to be aggregated
with Delaware Management Company, Inc. under Sections 414(b) or(c) of the Code.

2.9 "Employee" shall mean any person employed by the Employer or by any
affiliated Entity which adopts this Plan; provided, however, no person covered
by a collective bargaining agreement under which the Employer has participated
in good faith bargaining concerning retirement benefits shall be considered an
Employee for the purposes of this Plan. Any Leased Employee shall not be
considered an Employee for purposes of the Plan.

2.10 "Employer" shall mean Delaware Group Delaware Fund, Inc. and any other
affiliated investment company which adopts this Plan. Effective October 1, 1987,
and solely for purposes of determining periods of service for eligibility for
participation and vesting, the term "Employer" shall include any corporation
which is a member of a controlled group of corporations (as defined in Section
414(b) of the Code) which includes the Employer; any trade or business (whether
or not incorporated) which is under common control (as defined in Section 414(c)
of the Code) with the Employer; any organization (whether or not incorporated)
which is a member of an affiliated service group (as defined in Section 414(m)
of the Code) which includes the Employer; and any other Entity required to be
aggregated with the Employer pursuant to regulations under Section 414(o) of the
Code.

2.11 "Employer Contribution Account" shall mean a Participant's account
derived from Employer contributions and the earnings thereon.

2.12 "Entity" shall mean an individual, partnership, corporation or
unincorporated organization.

2.13 "ERISA" shall mean the Employee Retirement Income Security Act of 1974
and the Regulations promulgated thereunder by either the Department of Labor or
Treasury.

2.14 "Hour of Service" shall mean:

-5-

<PAGE>

(a) Each hour for which an Employee is paid, or entitled to payment, for
the performance of duties for the Employer. These hours will be credited to the
Employee for the computation period in which the duties are performed; and

(b) Each hour for which an Employee is paid, or entitled to payment, by the
Employer on account of a period of time during which no duties are performed
(irrespective of whether the employment relationship has terminated) due to
vacation, holiday, illness, incapacity (including disability), layoff, jury
duty, military service or leave of absence. No more than 501 Hours of Service
will be credited under this paragraph for any single continuous period (whether
or not such period occurs in a single computation period); and

(c) Each hour for which back pay, regardless of mitigation of damages, is
either awarded or agreed to by the Employer. The same Hours of Service will not
be credited both under paragraph (a) or paragraph (b), as the case may be, and
under this paragraph (c). These hours will be credited to the Employee for the
computation period or periods to which the award or agreement pertains rather
than the computation period in which the award, agreement or payment is made.

(d) Hours of Service will be calculated on the basis described in
Department of Labor Regulations Section 2530.200b-2(b) and (c).

(e) Solely for purposes of determining whether a Break in Service has
occurred, for participation and vesting purposes, an individual who is absent
from work for maternity or paternity reasons will receive credit for the Hours
of Service which would otherwise have been credited to such individual. In the
event these hours cannot be determined, eight (8) Hours of Service per day will
be used. For purposes of this paragraph, an absence from work for maternity or
paternity reasons means an absence (i) by reason of the pregnancy of the
individual, (ii) by reason of the birth of a child of the individual, (iii) by
reason of the placement of a child with the individual in connection with the
adoption of the child by such individual, or (iv) for purposes of caring for the
child for a period beginning immediately following such birth or placement.
However, in no event will the hours treated as Hours of Service under this
paragraph (e), by reason of any pregnancy or placement, exceed 501 hours. The
Hours of Service credited under this paragraph will be credited (i) in the Plan
Year in which the absence begins if the crediting is necessary to prevent a
Break in Service in that period, or (ii) in all other cases, in the following
Plan Year.

(f) Effective for Plan Years beginning on or after April 1, 1994, an
Employee shall be credited with 45 Hours of Service for each week for which he
would be required to be credited with at least one Hour of Service under
paragraphs (a)-(e) above.

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<PAGE>

2.15 "Leased Employee" shall mean any person described in Section 414(n) of
the Code who is not an employee of the Employer who, pursuant to an agreement
between the Employer and any other person, has performed service for the
Employer (or for any related persons determined in accordance with Section
414(n)(6) of the Code) on a substantially full-time basis for a period of at
least one year and such services are of a type historically performed by
employees in the Employer's business field.

2.16 "Named Fiduciary" shall be the Administrative Committee and the
Trustee or Trustees serving from time to time and any other person who is
specifically so designated by the Board of Directors.

2.17 "Normal Retirement Date" shall mean the date on which a Participant
shall reach age 65.

2.18 "One Year Break in Service" or "Break in Service" shall mean a Plan
Year during which an Employee has or was separated from employment with Employer
and has completed 500 or less Hours of Service.

2.19 "Participant" shall mean any Employee who meets the eligibility
requirements under Article III or any Employee who is or may become eligible to
receive a benefit under the Plan or whose Beneficiaries may be eligible to
receive any such benefit.

2.20 "Participant Contribution Account" shall mean a Participant's account
derived from his voluntary contributions and the earnings thereon.

2.21 "Plan" shall mean the Employer's Profit Sharing Plan set forth in this
document and all subsequent amendments thereto.

2.22 "Plan Compensation" shall mean as of each Anniversary Date, the basic
compensation received by an Employee from the Employer during the preceding Plan
Year, including salary, draw, overtime and bonuses, but excluding contributions
to this or any other deferred compensation plan. Plan Compensation includes
salary reduction contributions paid by the Employer on the Employee's behalf to
a cafeteria plan, within the meaning of Section 125 of the Code, maintained by
the Employer. Effective for Plan Years beginning on or after April 1, 1994, Plan
Compensation shall mean the sum of (a) the total earnings which are received by
the Employee from the Employer for the preceding Plan Year and which are
required to be reported as wages on the Employee's Form W-2 (in the wages, tips
and other compensation box) and (b) the total amount contributed by the

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<PAGE>

Employer on behalf of the Employee pursuant to a salary reduction agreement
which is not includable in the gross income of the Employee under Sections 125
or 402 (e)(3) of the Code, but excluding all of the following items (even if
includable in gross income): reimbursements or other expense allowances, fringe
benefits (cash and non-cash), moving expenses, deferred compensation and welfare
benefits.

For Plan Years beginning on or after April 1, 1989, the Plan Compensation
of each Participant taken into account under the Plan shall not exceed $200,000,
as adjusted by the Secretary of the Treasury. In determining the Plan
Compensation of a Participant for purposes of the limitations set forth in the
preceding sentence, the rules of Section 414(q)(6) of the Code shall apply,
except in applying such rules, the term "family" shall include only the spouse
of the Participant and any lineal descendants of the Participant who have not
attained age 19 before the close of the Plan Year. If, as a result of the
application of such rules, the adjusted $200,000 limitation is exceeded, then
the limitation shall be prorated among the affected individuals in proportion to
each such individual's Plan Compensation as determined under this Section 2.22
prior to the application of this limitation. Effective for Plan Years beginning
on or after January 1, 1994, the Plan Compensation of a Participant shall not
exceed $150,000, as adjusted at the time and manner prescribed by Section 401
(a)(17)(B) of the Code.

2.23 "Plan Year" shall mean a twelve-month period beginning on April 1st
and ending on March 31st. For the Plan Years beginning before April 1, 1989 and
after December 31, 1986, the term Plan Year means a twelve month period
beginning October 1st and ending September 30th, except that the Plan Year
beginning October 1, 1988 is a short year which ends March 31, 1989.

2.24 "Total and Permanent Disability" shall mean incapacity, resulting from
injury or disease, of a Participant to perform any work for Employer and shall
be presumed permanent after the same has continued uninterrupted for six months
as certified by a qualified physician selected by the Administrative Committee.

2.25 "Trustee" or "Trustees" shall mean the trustee or trustees named in
the Trust Agreement attached hereto and forming a part hereof, or any successor
thereto.

2.26 "Trust Fund" or "Fund" shall mean all property held pursuant to the
Trust Agreement.

2.27 "Valuation Date" means the last day of each Plan Year and such other
quarterly, monthly or daily dates as determined by the Administrative Committee.

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<PAGE>

2.28 "Year of Service" shall mean a Plan Year during which an Employee
completes at least 1,000 Hours of Service; provided, however, that for the
period from October 1, 1988 through March 31, 1990, an Employee shall be given
credit for a Year of Service if he completes 1,000 Hours of Service during the
period October 1, 1988 to September 30, 1989 and shall be given credit for an
additional Year of Service if he completes 1,000 Hours of Service during the
period April 1, 1989 to March 31, 1990. For purposes of determining a
Participant's nonforfeitable right to his Employer Contribution Account, Years
of Service shall include an Employee's prior service with Delaware Management
Company, Inc. or any other Entity required to be aggregated with Delaware
Management Company, Inc. under Sections 414(b) or (c) of the Code. An Employee
shall also receive credit for a Year of Service if he completes 1000 or more
Hours of Service during his initial Eligibility Computation Period.

2.29 Whenever used herein, the masculine provision includes the feminine
and the singular includes the plural.

ARTICLE III

ELIGIBILITY OF EMPLOYEES
TO PARTICIPATE IN THE PLAN
--------------------------
3.1 Each Employee who was a Participant on March 31, 1989 shall continue as
a Participant. Each other Employee shall be eligible to participate in this Plan
on the first day of the Plan Year within which he completes one Eligibility Year
of Service.

3.2 Any Participant who returns to service after a Break in Service shall
be admitted to the Plan as a Participant on his date of re-employment.

3.3 Within 60 days of each Anniversary Date of this Plan, the Employer
shall furnish the Administrator a list showing all eligible Employees, the date
of employment, the Years of Service, the Plan Compensation of each eligible
Employee and the date of termination of any terminated Employees.

3.4 Notwithstanding the provisions of Section 3.1 to the contrary, if an
Employee is employed by the Employer on March 31, 1989 and has completed by such
date 1,000 or more Hours of Service during an Eligibility Computation Period
which began on or before October 1, 1988, such Employee shall be eligible to
participate in the Plan on October 1, 1988.

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<PAGE>

ARTICLE IV

CONTRIBUTIONS TO PLAN
---------------------
4.1 Each participating Employer may contribute to the Plan's Trust Fund for
each taxable year an amount, if any, determined in accordance with a resolution
of the Board of Directors adopted before the date prescribed by law for filing
its Federal income tax return for such taxable year (including extensions
thereof); provided, however, that no contributions shall be made for any year in
excess of the amount deductible for such year under provisions of the Code and
regulations thereunder as then in effect. For Plan Years beginning on or after
April 1, 1989, the Employer may make contributions regardless of whether or not
it has Net Profits and Earnings for its tax year.

4.2 For Plan Years beginning before April 1, 1989, Net Profits and Earnings
in any one year of operations means the net income before provisions for Federal
and State income taxes as determined by the certified public accountants
employed by the Employer in accordance with generally accepted accounting
principles of open-end management investment companies.

4.3 For each taxable year, the contributions shall accrue on the
Anniversary Date thereof, but shall not be considered as accruing during the
said taxable year prior to the Anniversary Date thereof.

4.4 The Trust Fund shall not be diverted to any use other than the
exclusive benefit of eligible Employees and their Beneficiaries.

4.5 Effective August 1, 1991, a Participant may not make voluntary
contributions to his Participant Contribution Account. Prior to August 1, 1991,
a Participant may make voluntary contributions to his Participant Contribution
Account. Such contributions may be made by payroll deductions or in such other
manner and subject to such procedures as the Administrator may prescribe. No
Participant may contribute more than ten percent of his aggregate Plan
Compensation for all Plan Years during which he participated in the Plan.

4.6 Notwithstanding the provisions of Article IX, a Participant shall have
a nonforfeitable interest in all voluntary contributions made by him and in any
increase in his account attributable to such contributions.

4.7 A Participant shall have the right to withdraw the total amount of his
voluntary contributions at any time; provided, however, that such withdrawal

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<PAGE>

shall be permissible only with respect to the amount of such Participant's
voluntary contributions and not to any increase in his account attributable to
such contributions. No Participant shall be permitted to make withdrawals of
his voluntary contributions more than four times in any one calendar year.
Effective as of the date of adoption of this amended and restated Plan, a
Participant shall be permitted to make withdrawals as frequently as monthly of
all or a portion of his voluntary contributions, including the earnings
thereon.

4.8 The Fund may accept rollover contributions on behalf of an Employee
(including an Employee who has not satisfied the requirements to be eligible to
participate) from any other plan maintained for his benefit which satisfies the
requirements of a tax-qualified plan, or a rollover individual retirement
account; provided, however, that such rollovers are permitted by and effected in
accordance with the requirements of the Code. The Administrative Committee may
as a condition of acceptance of such rollovers demand such information, opinions
and statements as it deems necessary to assure that such rollovers conform to
the requirements of the federal tax laws.

4.9 An Employee for whom a rollover has been made shall be deemed a
Participant with respect to the amount contributed and shall have a
nonforfeitable interest in such amount and any increases attributable to it. Any
such rollovers shall be held in a special account for the Participant segregated
from other assets held by the fund. Such contributions will be administered and
distributed pursuant to the provisions of this Plan.

4.10 The following special non-discrimination rules pertaining to voluntary
contributions shall be applicable for Plan Years beginning on or after October
1, 1987 and before April 1, 1990.

(a) For any Plan Year, the Contribution Percentage for all Highly
Compensated Employees will not exceed the greater of (i) or (ii) as follows:

(i) The Contribution Percentage for all Non-Highly Compensated Employees,
times 1.25; or

(ii) The lesser of the Contribution Percentage for all Non-Highly
Compensated Employees, times 2.0, provided that the Contribution Percentage for
all Highly Compensated Employees may not exceed the Contribution Percentage for
all Non-Highly Compensated Employees by more than two (2) percentage points or
such lesser amount as the Secretary of Treasury will prescribe to prevent the
multiple use of this alternative limitation with respect to any Highly
Compensated Employee.

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<PAGE>

(b) Distribution of Excess Aggregate Contributions.

(i) Excess Aggregate Contributions, plus any income and minus any loss
allocable thereto, will be distributed no later than the last day of each Plan
Year to Participants to whose accounts Excess Aggregate Contributions were
allocated for the preceding Plan Year.

(ii) For the Plan Year beginning on October 1, 1987, the income or loss
allocable to Excess Aggregate Contributions shall be determined under any
reasonable method, which method shall be applied on a consistent basis for all
Participants. For Plan Years beginning after 1987, the income or loss allocable
to Excess Aggregate Contributions shall be the sum of (A) and (B) below:

(A) The income or loss for the Plan Year allocable to the Participant's
voluntary contribution Account multiplied by a fraction, the numerator of which
is the Participant's Excess Aggregate Contributions for the year, and the
denominator of which is the balance of the Participant's voluntary contribution
account as of the end of the Plan Year, minus income (or plus losses) allocable
to such account.

(B) The income or loss for the period between the end of the Plan Year and
the date of the distribution allocable to the Participant's voluntary
contribution account multiplied by the fraction described in (A), above.

In lieu of using the formula described in (B), the income or loss for the
period between the end of the Plan Year and the date of the distribution
allocable to Excess Aggregate Contributions for the year may be calculated under
the following alternative method, provided such method is applied on a
consistent basis for all Participants: ten percent (10%) of the amount
determined under (A), above, multiplied by the number of whole calendar months
that have elapsed since the end of the Plan Year. For this purpose, if a
distribution of Excess Aggregate Contributions is made after the 15th day of a
month, that month will be counted as a whole month.

(i) "Contribution Percentage" means, for a group of Participants, the
average of the following ratios (calculated separately) for each Participant in
the group:

(A) The sum of voluntary contributions made on behalf of each Participant
for the Plan Year; over

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<PAGE>

(B) The Participant's Compensation for that Plan Year, whether or not the
Participant was a Participant for the entire Plan Year.

The Contribution Percentage for any Participant who is a Highly Compensated
Employee for the Plan Year and who is eligible to have voluntary employee
contributions or employer matching contributions allocated to his account under
two or more plans described in Section 401(a) of the Code or arrangements
described in Section 401(k) of the Code that are maintained by the employer or
an entity that is required to be aggregated with the employer pursuant to
Sections 414(b), (c), (m), or (o) of the Code will be determined as if all such
contributions were made under a single plan. If a Highly Compensated Employee
participates in two or more arrangements described in Section 401(k) of the Code
that have different plan years, all such arrangements ending with or within the
same calendar year shall be treated as a single arrangement.

For purposes of determining the Contribution Percentage of a Participant
who is a five-percent owner or one of the ten most Highly Compensated Employees,
the Contribution Percentage and compensation of such Participant will include
the Contribution Percentage and Compensation of Family Members, and such Family
Members will be disregarded in determining the Contribution Percentage for
Participants who are Non-Highly Compensated Employees.

Voluntary contributions will be considered made for a Plan Year if made by
the date specified in the applicable regulations and allocated to a
Participant's account for the Plan Year.

The determination and treatment of the Contribution Percentage of any
Participant will satisfy such other requirements as may be prescribed by
Secretary of the Treasury.

In the event that this Plan satisfies the requirements of Sections 401(m),
401(a)(4) or 410(b) of the Code only if aggregated with one or more other plans,
or if one or more other plans satisfy the requirements of such Sections only if
aggregated with this Plan, then this Section 4.10 will be applied by determining
the Contribution Percentages of eligible Participants as if all such plans were
a single plan. For plan years beginning after December 31, 1989, plans may be
aggregated in order to satisfy Section 401(m) of the Code only if they have the
same plan year.

(ii) "Excess Aggregate Contributions" means, with respect to any Plan Year,
the excess of:

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<PAGE>

(A) The aggregate Contribution Percentage amounts taken into account in
computing the numerator of the Contribution Percentage actually made on behalf
of Highly Compensated Employees for such Plan Year; over

(B) The maximum Contribution Percentage amounts permitted by the
Contribution Percentage limits set forth in this Section 4.10 (determined by
reducing contributions made on behalf of Highly Compensated Employees in order
of their Contribution Percentages beginning with the highest of such
percentages).

(iii) "Family Member" means an individual described in Section 414(q)(6)(B)
of the Code.

(iv) "Highly Compensated Employee" means a highly compensated active
employee or a highly compensated former employee, as described below.

A highly compensated active employee includes any employee who performs
service for the employer during the determination year and who, during the
look-back year: (i)received compensation from the employer in excess of $75,000
(as adjusted pursuant to Section 415(d) of the Code); (ii) received compensation
from the employer in excess of $50,000 (as adjusted pursuant to Section 415(d)
of the Code) and was a member of the top-paid group for such year; or (iii) was
an officer of the employer and received compensation during such year that is
greater than 50 percent of the dollar limitation in effect under Section
415(b)(1)(A) of the Code. The term Highly Compensated Employee also includes:
(i) employees who are both described in the preceding sentence if the term
"determination year" is substituted for the term "look-back year" and the
employee is one of the 100 employees who received the most compensation from the
Employer during the determination year; and (ii) employees who are five percent
owners at any time during the look-back year or determination year.

If no officer has satisfied the compensation requirement of (iii) above
during either a determination year or a look-back year, the highest paid officer
for such year shall be treated as a Highly Compensated Employee.

For this purpose, the determination year shall be the Plan Year. The
look-back shall be the twelve (12)-month period immediately preceding the
determination year.

A highly compensated former employee includes any employee who separated
from service (or was deemed to have separated) prior to the determination year,
performs no service for the employer during the determination year, and was a
highly compensated active employee for either the separation year or any
determination year ending on or after the employee's fifty-fifth (55th)
birthday.

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<PAGE>

If an employee is, during a determination year or look-back year, a Family
Member of either a five percent owner who is an active or former employee or a
Highly Compensated Employee who is one of the ten (10) most Highly Compensated
Employees ranked on the basis of compensation paid by the Employer during such
year, then the Family Member and the five percent owner or top-ten (10) Highly
Compensated Employee shall be aggregated. In such case, the Family Member and
five percent owner or top-ten Highly Compensated Employee shall be treated as a
single employee receiving compensation and Plan contributions or benefits equal
to the sum of such compensation and contributions or benefits of the Family
Member and five percent owner or ten (10) most Highly Compensated Employee.

The determination of who is a Highly Compensated Employee, including the
determinations of the number and identity of employees in the top-paid group,
the top one hundred (100) employees, a five percent owner, the number of
employees treated as officers and the compensation that is considered, will be
made in accordance with Section 414(q) of the Code and the regulations
thereunder.

(v) "Compensation" means all of an Employee's compensation, as that term is
defined in Article XV, Limitations on Allocations, and shall include elective
contributions that are made by the Employer on behalf of the Employee and which
are not includable in income under Section 125 of the Code. Compensation shall
be subject to the limitation of Section 401(a)(17) of the Code.

ARTICLE V

ALLOCATION OF CONTRIBUTIONS
---------------------------
5.1 A separate and complete accounting shall be maintained for each
Participant which shall set forth the amount credited to or forfeited from his
Employer Contribution Account and his Participant Contribution Account. Employer
contributions and Participant contributions shall be allocated among investment
companies managed by Delaware Management Company, Inc. Each Participant shall
file a written notice with the Committee thereby making an election as to what
proportion of his contributions, including both contributions made by the
Employer and voluntary contributions, shall be allocated to the eligible
investment company funds, as announced from time to time by the Committee. Each
Participant shall have the right to change the investment allocation of his
contributions and his accumulated account balance, in accordance with rules and
procedures as announced from time to time by the Committee, provided changes are
subject to any limitations imposed on the right of exchange by the investment
media.

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5.2 The Employer's contributions and any forfeitures for each Plan Year
shall be credited to the Employer Contribution Accounts of Participants who are
employed by the Employer on the Anniversary Date and allocated in the proportion
that the Plan Compensation of each Participant bears to the total Plan
Compensation of all Participants for such Plan Year. A Participant who
terminates employment on the Anniversary Date shall be treated as employed by
the Employer on the Anniversary Date. All voluntary contributions made by a
Participant prior to August 1, 1991 shall be credited to his Participant
Contribution Account.

5.3 As of the Anniversary Date, each Participant's Employer Contribution
Account and his Participant Contribution Account shall be valued at its fair
market value. For the purposes of paying benefits to a Participant, his accounts
shall be valued on the most recent Valuation Date as determined by the
Administrative Committee.

5.4 Income when earned less expenses, if any, when charged, shall be
credited to or charged against each Participant's account, in accordance with
the self-directed investments selected by the Participant.

5.5 The Committee shall, as of each Anniversary Date, determine the total
amount of forfeitures which accrued during the Plan Year and shall add the
forfeited amount to the Employer's annual contribution for the purposes of
reallocation to the remaining Participants as provided in Section 5.2.

5.6 Any allocation made and credited to the account of a Participant under
this Article shall not cause such Participant to have any right, title or
interest in or to any assets of the Trust Fund except at the time or times, and
under the terms and conditions, expressly provided for in this Plan.

5.7 (a) In the case of a contribution to the Plan which is made by the
Employer because of a mistake of fact, the Employer may, within one year after
the payment of such contribution, withdraw such contribution from the Trust
Fund.

(b) Employer contributions to the Plan are expressly conditioned on the
deductibility of such contributions under Section 404 of the Code. To the extent
such contributions are disallowed, the Employer may, within one year of the
disallowance of the deduction, withdraw such contribution from the Trust Fund.

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ARTICLE VI

RETIREMENT BENEFITS
-------------------
6.1 Upon attaining Normal Retirement Date, a Participant shall have a fully
vested and nonforfeitable right to his entire Employer Contribution Account and
shall be entitled to retire and upon so retiring shall be entitled to the
commencement of the payment of his benefits, consisting of the balance of his
accounts, in accordance with the method of payment elected pursuant to Article
X.

6.2 A Participant who retires after his Normal Retirement Date shall
continue to be a Participant in the Plan until his actual retirement and shall
be eligible to share in the allocation of Employer contributions as provided in
Section 5.2.

ARTICLE VII

DISABILITY BENEFITS
-------------------
7.1 If the employment of a Participant has been terminated prior to his
retirement date because of Total and Permanent Disability, such Participant
shall be entitled to receive his entire Participant Contribution Account and his
entire Employer Contribution Account in accordance with the manner elected under
Article X.

7.2 Upon a Participant's cessation of Total and Permanent Disability and
upon his return to work for Employer before all of his account has been
distributed, no further payments shall be made therefrom by reason of the
disability. A Participant shall have no right or obligation to repay any amount
distributed to him pursuant to Section 7.1.

ARTICLE VIII

DEATH BENEFITS
--------------
8.1 Notwithstanding anything stated in the Plan to the contrary, if a
Participant dies prior to receiving the entire nonforfeitable amount credited to
his accounts, all such undistributed nonforfeitable amounts shall be paid to the
Participant's surviving spouse, unless there is no surviving spouse or the
surviving spouse consents in writing to the payment of death benefits to another
Beneficiary. A spouse's consent must satisfy the following requirements:

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(a) the consent must be in writing;

(b) the consent must be witnessed by a member of the Administrative
Committee or a notary public;

(c) the consent must approve a designation of a specific Beneficiary,
including any class of Beneficiaries or any contingent Beneficiaries, which may
not be changed without spousal consent, or the spouse expressly permits
designations by the Participant without any further spousal consent; and

(d) the consent acknowledges the effect of the Participant's designation of
Beneficiary. If a consent permits designations by the Participant without any
requirement of further consent by such spouse, it must acknowledge that the
spouse has the right to limit consent to a specific Beneficiary and that the
spouse voluntarily elects to relinquish such right.

Written consent of a spouse need not be obtained if the Participant
establishes to the satisfaction of the Committee that there is no spouse or that
the spouse cannot be located. Any such designation may be changed from time to
time by the Participant by filing a new designation with the Committee, provided
the spousal consent requirements above are satisfied.

8.2 Each Participant may file with the Committee a designation of
Beneficiary to receive amounts payable under this Plan upon his death. The
designation may be changed from time to time by the Participant, except that a
married Participant may not name a Beneficiary other than his spouse without a
written consent which satisfies the requirements of Section 8.1. If no
designation has been filed, or all designated Beneficiaries have predeceased the
Participant, then any amounts payable shall be paid to his surviving spouse. If
there is no surviving spouse, any amounts payable shall be paid to his estate.

8.3 If at, after or during the time when a benefit is payable to any
Beneficiary, the Administrative Committee, upon request of the Trustee or at its
own instance, mails by registered or certified mail to the Beneficiary at the
Beneficiary's last known address a written demand for his then address, or for
satisfactory evidence of his continued life or both, and, if the Beneficiary
shall fail to furnish the information to the Committee within 3 years from the
mailing of the demand, then the Committee shall distribute the remaining
benefits to the Beneficiary next entitled thereto under Section 8.3 above as if
the Beneficiary designated by the Participant or Section 8.3 were then deceased.

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ARTICLE IX

OTHER SEPARATION FROM SERVICE
-----------------------------
9.1 (a) If a Participant separates from service other than under Articles
VI, VII or VIII, he shall be entitled to receive a lump sum distribution of his
entire Participant Contribution Account and his entire nonforfeitable Employer
Contribution Account. Such distribution shall be made upon the written request
of the Participant and shall be made as soon as practicable following the
Participant's separation from service, but not later than the close of the
second Plan which such separation occurs.

(b) If the non-forfeitable portion of the Participant's Employer
Contribution Account and his Participant Contribution Account exceeds $3500 (or
ever exceeded $3500 at the time of an earlier distribution), and the Participant
does not consent in writing to receive a lump sum distribution of his accounts
by the close of the second Plan Year following his separation from service, no
distribution shall be made to the Participant until he attains his Normal
Retirement Date. Regardless of whether the Participant consents in writing, if
the non-forfeitable portion of the Participant's Employer Contribution Account
and Participant Contribution Account does not exceed $3500 (or did not exceed
$3500 at the time of a prior distribution), a lump sum distribution shall be
made to the Participant of the entire value of the non-forfeitable portion of
his accounts not later than the end of the second Plan Year following his
separation from service.

(c) If a distribution is made to the Participant of the nonforfeitable
portion of his Employer Contribution Account upon his separation from service,
the non-vested portion of his Account, if any, will be treated as a forfeiture
and reallocated to remaining Participants as provided in Section 5.2. If the
Participant does not receive a distribution of his Employer Contribution Account
upon his separation from service, such Account shall be held for the Participant
until he attains Normal Retirement Date and the non-vested portion of the
Account shall be treated as a forfeiture when the Participant sustains five
consecutive One Year Breaks in Service.

(d) In the event a Participant who is less than fully vested in his
Employer Contribution Account receives a distribution of his vested interest in
such Account upon his separation from service, and such Participant subsequently
returns to employment of the Employer, the Participant's Employer Contribution
Account will be restored to the value of the Account on the date of the
distribution if the Participant repays to the Trustees the full amount of such

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<PAGE>

distribution before the earlier of five consecutive One-Year Breaks in Service
or five years after the Participant's date of reemployment. Restoration of the
forfeited amount of a Participant's Account shall be made from forfeitures or
Employer contributions.

9.2 (a) In the event a Participant separates from service with the Employer
for reasons other than retirement, disability, death or a layoff by the
Employer, he shall have a nonforfeitable right to the amount credited to his
Employer Contribution Account in accordance with the following schedule:

Completed Years of Service Percentage
-------------------------- ----------
At least But less than
0 1 0%
1 2 20%
2 3 40%
3 4 60%
4 5 80%
5 or more 100%

(b) A Participant shall have a wholly vested and nonforfeitable right to
his Employer Contribution Account upon separation from service on account of
retirement on or after the Normal Retirement Date, Total and Permanent
Disability, death while in the employ of the Employer or layoff by the Employer.
For purposes of this Section 9.2, the term "layoff" shall mean any involuntary
separation from service other than separation due to cause. If a Participant
separates from service with the Employer, the non-vested portion of his Employer
Contribution Account, if any, shall be forfeited upon the death of the
Participant.

(c) If the Employer amends the Plan in a manner which directly or
indirectly affects the computation of a Participant's nonforfeitable percentage,
each Participant who completes an Hour of Service in any Plan Year beginning
after December 31, 1988 and who has at least three Years of Service may elect
after the adoption of such amendment to have his nonforfeitable interest
computed under the Plan without regard to such amendment. The period during
which the election may be made shall commence the day the amendment is adopted
and shall end on later of:

(i) sixty (60) days after the amendment is adopted;

(ii) sixty (60) days after the amendment becomes effective; or

(iii) sixty (60) days after the Participant is issued written notice of the
amendment by the Employer or the Committee.

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9.3 (a) In the case of a Participant who has a Break in Service, Years of
Service completed before such Break shall not be counted until the Participant
has completed a Year of Service for the purpose of determining his
nonforfeitable percentage of the amount credited to his Employer Contribution
Account after such Break in Service.

(b) Years of Service completed on reemployment and after separation from
service with the Employer in connection with which he has five consecutive One
Year Breaks in Service shall not be counted for purposes of determining such
Participant's nonforfeitable percentage right to amounts credited to his
Employer Contribution Account before such Break in Service.

ARTICLE X

METHOD OF PAYMENT
-----------------
10.1 At the request of a Participant, the form of benefit payments may be
one of the following in cash:

(a) in a lump sum payment; or

(b) in periodic, monthly, quarterly, semi-annual or annual installments
over a period certain not exceeding the Participant's life expectancy or the
joint life expectancy of the Participant and his designated Beneficiary. If
periodic installments are to be paid, a Participant's account shall be invested
in the investment company funds available under the Plan as designated by the
Participant.

If periodic installments are paid over the life expectancy of the
Participant or joint life expectancy of the Participant and a designated
Beneficiary, a Participant may elect, prior to the time distributions begin,
whether or not to have his life expectancy and his Beneficiary's life expectancy
(if the Beneficiary is his spouse) annually recalculated. In the absence of such
election, life expectancies will not be recalculated.

10.2 In no event shall payments of benefits under this Plan commence later
than sixty (60) days after the close of the Plan Year in which the latest of the
following events occur:

(a) the Participant attains age sixty-five (65); or

(b) the Participant completes ten years of participation in the Plan; or

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10.3 (a) Notwithstanding the other requirements of this Plan, distributions
on behalf of any Participant, including a five percent (5%) owner, may be made
in accordance with all of the following requirements (regardless of when such
distribution commences):

(i) The distribution by the Trust Fund is one which would not have
disqualified such Trust under Section 401(a)(9) of the Code as in effect prior
to amendment by the Deficit Reduction Act of 1984.

(ii) The distribution is in accordance with a method of distribution
designated by the Participant whose interest is being distributed or, if the
Participant is deceased, by a Beneficiary of such Participant.

(iii) Such designation was in writing, was signed by the Participant or the
Beneficiary, and was made before January 1, 1984.

(iv) The Participant had accrued a benefit under the Plan as of December
31, 1983.

(v) The method of distribution designated by the Participant or the
Beneficiary specifies the time at which distribution will commence, the period
over which distributions will be made, and in the case of any distribution upon
the Participant's death, the Beneficiaries of the Participant listed in order of
priority.

(b) A distribution upon death will not be covered by this Section unless
the information in the designation contains the required information described
above with the respect to the distributions to be made upon the death of the
Participant.

(c) For any distribution which commenced before January 1, 1984, but
continues after December 31, 1983, the Participant, or the Beneficiary, to whom
such distribution is being made, will be presumed to have designated the method
of distribution under which the distribution is being made if the method of
distribution was specified in writing and the distribution satisfies the
requirements in subsections (a)(i) and (v) above.

(d) If a designation is revoked, any subsequent distribution must satisfy
the requirements of Section 401(a)(9) of the Code. Any changes in the
designation will be considered to be revocation of the designation. However, the
mere substitution or addition of another Beneficiary (one not named in the

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designation) under the designation will not be considered to be revocation
of the designation, so long as such substitution or addition does not alter the
period over which distributions are to be made under the designation, either
directly or indirectly (for example, by altering the relevant measuring life).

10.4 Required Distributions. All distributions required under this Section
10.4 shall be determined and made in accordance with the proposed regulations
under Section 401(a)(9) of the Code, including the minimum distribution
incidental benefit requirement of Section 1.401(a)(9)-2 of the proposed
regulations.

(a) Required beginning date. The entire interest of a Participant must be
distributed or begin to be distributed no later than the Participant's required
beginning date.

(b) Limits on Distribution Periods. As of the first distribution calendar
year, distributions, if not made in a single-sum, may only be made over one of
the following periods (or a combination thereof):

(1) a period certain not extending beyond the life expectancy of the
Participant, or

(2) a period certain not extending beyond the joint and last survivor
expectancy of the Participant and a designated beneficiary.

(c) Determination of amount to be distributed each year. If the
Participant's interest is to be distributed in other than a single sum, the
following minimum distribution rules shall apply on or after the required
beginning date:

(1) If a Participant's benefit is to be distributed over (i) a period not
extending beyond the life expectancy of the Participant or the joint life and
last survivor expectancy of the Participant and the Participant's designated
beneficiary or (ii) a period not extending beyond the life expectancy of the
designated beneficiary, the amount required to be distributed for each calendar
year, beginning with distributions for the first distribution calendar year,
must at least equal the quotient obtained by dividing the Participant's benefit
by the applicable life expectancy.

(2) For calendar years beginning before January 1, 1989, if the
Participant's spouse is not the designated beneficiary, the method of
distribution selected must assure that at least fifty percent (50%) of the
present value of the amount available for distribution is paid within the life
expectancy of the Participant.

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(3) For calendar years beginning after December 31, 1988, the amount to be
distributed each year, beginning with distributions for the first distribution
calendar year, shall not be less than the quotient obtained by dividing the
Participant's benefit by the lesser of (1) the applicable life expectancy or (2)
if the Participant's spouse is not the designated beneficiary, the applicable
divisor determined from the table set forth in Q&A-4 of Section 1.401(a)(9)-2 of
the proposed regulations. Distributions after the death of the Participant shall
be distributed using the applicable life expectancy in (c)(i)(A) above as the
relevant divisor without regard to proposed regulations Section 1.401(a)(9)-2.

(4) The minimum distribution required for the Participant's first
distribution calendar year must be made on or before the Participant's required
beginning date. The minimum distribution for other calendar years, including the
minimum distribution for the distribution calendar year in which the
Participant's required beginning date occurs, must be made on or before December
31 of that distribution calendar year.

(d) Death Distribution Provisions.

(1) Distribution beginning before death. If the Participant dies after
distribution of his or her interest has begun, the remaining portion of such
interest will continue to be distributed at least as rapidly as under the method
of distribution being used prior to the Participant's death.

(2) Distribution beginning after death. If the Participant dies before
distribution of his or her interest begins, distribution of the Participant's
entire interest shall be completed by December 31 of the calendar year
containing the fifth (5th) anniversary of the Participant's death except to the
extent that the Participant or his designated beneficiary elects to receive
distributions in accordance with (i) or (ii) below:

(i) if any portion of the Participant's interest is payable to a designated
beneficiary, distributions may be made over a period certain not greater than
the life expectancy of the designated beneficiary commencing on or before
December 31 of the calendar year immediately following the calendar year in
which the Participant died;

(ii) if the designated beneficiary is the Participant's surviving spouse,
the date distributions are required to begin in accordance with (i) above shall
not be earlier than the later of (1) December 31 of the calendar year
immediately following the calendar year in which the Participant died and (2)
December 31 of the calendar year in which the Participant would have attained
age 70 1/2.

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If the Participant has not made an election pursuant to Section 10.4(d)(2)
by the time of his or her death, the Participant's designated beneficiary must
elect the method of distribution no later than the earlier of (1) December 31 of
the calendar year in which distributions would be required to begin under this
Section 10.4(d), or (2) December 31 of the calendar year which contains the
fifth (5th) anniversary of the date of death of the Participant. If the
Participant has no designated beneficiary, or if the designated beneficiary does
not elect a method of distribution, distribution of the Participant's entire
interest must be completed by December 31 of the calendar year containing the
fifth (5th) anniversary of the Participant's death.

(3) For purposes of Section 10.4(d)(2) above, if the surviving spouse dies
after the Participant, but before payments to such spouse begin, the provisions
of Section 10.4(d)(2), with the exception of subparagraph (ii) therein, shall be
applied as if the surviving spouse were the Participant.

(4) For purposes of Section 10.4(d), distribution of a Participant's
interest is considered to begin on the Participant's required beginning date
(or, if Section 10.4(d)(3) above is applicable, the date distribution is
required to begin to the surviving spouse pursuant to Section 10.4(d)(3) above).

(e) Definitions.

(1) Applicable life expectancy. The life expectancy (or joint and last
survivor expectancy) calculated using the attained age of the Participant (or
designated beneficiary) as of the Participant's (or designated beneficiary's)
birthday in the applicable calendar year reduced by one for each calendar year
which has elapsed since the date life expectancy was first calculated. If life
expectancy is being recalculated, the applicable life expectancy will be the
life expectancy as so recalculated. The applicable calendar year shall be the
first distribution calendar year and if life expectancy is being recalculated,
such succeeding calendar year.

(2) Designated beneficiary. The individual who is designated as the
beneficiary under the Plan in accordance with Section 401(a)(9) and the proposed
regulations thereunder.

(3) Distribution calendar year. A calendar year for which a minimum
distribution is required. For distributions beginning before the Participant's
death, the first distribution calendar year is the calendar year immediately
preceding the calendar year which contains the Participant's required beginning
date. For distributions beginning after the Participant's death, the first
distribution calendar year is the calendar year in which distributions are
required to begin pursuant to Section 10.4(d) above.

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(4) Life expectancy. Life expectancy and joint and last survivor expectancy
are computed by use of the expected return multiples in Tables V and VI of
Section 1.72-9 of the income tax regulations. Unless otherwise elected by the
Participant by the time distributions are required to begin, life expectancies
shall not be recalculated annually. Such election shall be irrevocable as to the
Participant (or spouse) and shall apply to all subsequent years. The life
expectancy of a nonspouse designated beneficiary may not be recalculated. A
spousal designated beneficiary may not elect to have his or her life expectancy
recalculated with respect to any distribution paid pursuant to Section
10.4(d)(2).

(5) Participant's benefit.

(i) The Participant's account balance as of the last valuation date in the
calendar year immediately preceding the distribution calendar year (valuation
calendar year) increased by the amount of any contributions or forfeitures
allocated to the account balance as of dates in the valuation calendar year
after the valuation date and decreased by distributions made in the valuation
calendar year after the valuation date.

(ii) For purposes of paragraph (i) above, if any portion of the minimum
distribution for the first distribution calendar year is made in the second
distribution calendar year on or before the required beginning date, the amount
of the minimum distribution made in the second distribution calendar year shall
be treated as if it had been made in the immediately preceding distribution
calendar year.

(6) Required beginning date.

(i) General rule. The required beginning date of a Participant is the first
day of April of the calendar year following the calendar year in which the
Participant attains age 70 1/2.

(ii) Transitional rules. The required beginning date of a Participant who
attains age 70 1/2 before January 1, 1988, shall be determined in accordance
with (A) or (B) below:

(A) Non-five (5)-percent owners. The required beginning date of a
Participant who is not a five (5)-percent owner is the first day of April of the
calendar year following the calendar year in which the later of retirement or
attainment of age 70 1/2 occurs.

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(B) Five (5)-percent owners. The required beginning date of a Participant
who is a five (5)-percent owner during any year beginning after December 31,
1979, is the first day of April following the later of:

(I) the calendar year in which the Participant attains age 70 1/2, or

(II) the earlier of the calendar year with or within which ends the Plan
Year in which the Participant becomes a five (5)-percent owner, or the calendar
year in which the Participant retires.

The required beginning date of a Participant who is not a five (5)-percent
owner who attains age 70 1/2 during 1988 and who has not retired as of January
1, 1989, is April 1, 1990.

(iii) Five (5)-percent owner. A Participant is treated as a five
(5)-percent owner for purposes of this section if such Participant is a five
(5)-percent owner as defined in Section 416(i) of the Code (determined in
accordance with Section 416 but without regard to whether the Plan is top-heavy)
at any time during the Plan Year ending with or within the calendar year in
which such owner attains age 66 1/2 or any subsequent Plan Year.

(iv) Once distributions have begun to a five (5)-percent owner under this
section, they must continue to be distributed, even if the Participant ceases to
be a five (5)-percent owner in a subsequent year.

10.5 Restrictions on Distributions Prior to Normal Retirement Date. If the
value of a Participant's vested account balance exceeds (or at the time of any
prior distribution exceeded) $3,500, the Participant must consent to any
distribution made to him before he attains the Normal Retirement Date. The
consent of the Participant shall be obtained in writing within the 90-day period
ending on the date benefits are paid. The Committee shall notify the Participant
of his right to defer any distribution until the Participant attains the Normal
Retirement Date (or would have attained the Normal Retirement Date if not
deceased). Such notification shall include a general description of the material
features, and an explanation of the relative values of, the optional forms of
benefit available under the Plan in a manner that would satisfy the notice
requirements of Section 417(a)(3) of the Code below, and shall be provided no
less than 30 days and no more than 90 days prior to the date benefits are paid.
The consent of the Participant shall not be required to the extent that a
distribution is required to satisfy Sections 401(a)(9) or 415 of the Code. A
distribution may be paid to the Participant less than 30 days after the notice
described in this Section 10.5 is given to him, provided that the Administrative
Committee clearly informs the Participant that he has the right to a period of

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at least 30 days after receiving the notice to consider the decision of
whether or not to elect the distribution and the Participant, after receiving
the notice, affirmatively elects to receive a distribution. In addition, subject
to Section 10.7, upon termination of this Plan, the Participant's entire account
balance may be distributed without the Participant's consent to the Participant
or transferred to another defined contribution plan (other than an employee
stock ownership plan, as defined in Section 4975(e)(7) of the Code) within the
same controlled group as the Employer.

10.6 Withdrawals upon Attainment of Age 59-1/2. Upon the attainment of age
59-1/2, a Participant who is fully vested in his Employer Contribution Account
will be entitled to withdraw once a Plan Year all or any portion of his account
balance in a single sum. Any withdrawal by a Participant under this Section 10.6
will be made only after the Participant files a written request with the
Administrative Committee pursuant to such terms and conditions as the Committee
may prescribe.

10.7 Direct Rollovers

(a) This Section applies to distributions made on or after January 1, 1993.
Notwithstanding any provision of the Plan to the contrary that would otherwise
limit a distributee's election under this Section, a distributee may elect, at
the time and in the manner prescribed by the Administrative Committee to have
any portion of an eligible rollover distribution paid directly to an eligible
retirement plan specified by the distributee in a direct rollover.

(b) Definitions.

(i) Eligible rollover distribution: An eligible rollover distribution is
any distribution of all or any portion of the balance to the credit of the
distributee, except that an eligible rollover distribution does not include: any
distribution that is one of a series of substantially equal periodic payments
(not less frequently than annually) made for the life (or life expectancy) of
the distributee or the joint lives (or joint life expectancies) of the
distributee and the distributee's designated beneficiary, or for a specified
period of ten years or more; any distribution to the extent such distribution is
required under section 401(a)(9) of the Code; and the portion of any
distribution that is not includable in gross income (determined without regard
to the exclusion for net unrealized appreciation with respect to employer
securities).

(ii) Eligible retirement plan: An eligible retirement plan is an individual
retirement account described in section 408(a) of the Code, an individual

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retirement annuity described in section 408(b) of the Code, an annuity plan
described in section 403(a) of the Code, or a qualified trust described in
section 401(a) of the Code, that accepts the distributee's eligible rollover
distribution. However, in the case of an eligible rollover distribution to the
surviving spouse, an eligible retirement plan is an individual retirement
account or individual retirement annuity.

(iii) Distributee: A distributee includes an Employee or former Employee.
In addition, the Employee's or former Employee's surviving spouse or former
spouse who is the alternate payee under a qualified domestic relations order, as
defined in section 414(p) of the Code, are distributees with regard to the
interest of the spouse or former spouse.

(iv) Direct rollover: A direct rollover is a payment by the Plan to the
eligible retirement plan specified by the distributee.

ARTICLE XI

ADMINISTRATION OF PLAN
----------------------
11.1 (a) This Plan shall be administered by a Committee which shall consist
of not less than two nor more than five members.

(b) The Committee shall serve without compensation from the Plan. Vacancies
may be filled by the Chief Executive Officer of Delaware Group Delaware Fund,
Inc. on an interim basis, until action to fill the vacancy is taken by the Board
of Directors of Delaware Group Delaware Fund, Inc.

(1) shall act by affirmative vote of a majority of its members at a meeting
called with five days notice or in writing without a meeting;

(2) shall appoint a Secretary who may be but need not be one of its own
members. He shall keep complete records of the administration of the Plan;

(3) may authorize each and any one of its members to perform routine acts
and to sign documents on its behalf.

11.2 The Committee may appoint such persons or committees, employ such
attorneys, agents, accountants, investment managers, consultants, actuaries, and
other specialists as it deems necessary or desirable to advise or assist

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it in the performance of its duties hereunder and the Committee may rely upon
their respective written opinions or certificates. To the extent such persons
are empowered by written notification from the Committee to perform duties
defined in ERISA as fiduciary duties, such empowerment shall constitute a
delegation of fiduciary responsibility for purposes of determining the
co-fiduciary liability under ERISA. The Committee shall review the performance
of any such persons periodically.

11.3 Administration of the Plan shall consist of interpreting and carrying
out the provisions of this Plan. The Committee shall determine the eligibility
of Employees to participate in this Plan, their rights while Participants in
this Plan and the nature and amount of benefits to be received therefrom. The
Committee shall decide any disputes which may arise under this Plan and the
Trust Agreement. The Committee may provide rules and regulations for the
administration of the Plan consistent with its terms and provisions. Any
construction or interpretation of the Plan and any determination of fact in
administering the Plan made in good faith by the Committee shall be final and
conclusive for all Plan purposes. The Committee shall have the discretionary
authority to determine eligibility for benefits and to construe the terms of the
Plan.

11.4 (a) The Committee shall prescribe a form for the presentation of
claims under the terms of this Plan and/or Trust Agreement.

(b) Upon presentation to the Committee of a claim on the prescribed form,
the Committee shall make a determination of the validity thereof. If the
determination is adverse to the claimant, the Committee shall furnish to the
claimant within 90 days after the receipt of the claim a written notice setting
forth the following:

(1) The specific reason or reasons for the denial;

(2) Specific reference to pertinent provisions of the Plan on which the
denial is based;

(3) A description of any additional material or information necessary for
the claimant to perfect the claim and an explanation of why such material or
information is necessary; and

(4) Appropriate information as to the steps to be taken if the claimant
wishes to submit his or her claim for review.

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(c) In the event of a denial of a claim, the claimant or his duly
authorized representative may appeal such denial to the Committee for a full and
fair review of the adverse determination. Claimant's request for review must be
in writing and made to the Committee within 60 days after receipt by claimant of
the written notification required under Section 11.4(b); provided, however, such
60 day period shall be extended if circumstances so warrant. Claimant or his
duly authorized representative may submit issues and comments in writing which
shall be given full consideration by the Committee in his review.

(d) The Committee may, in its sole discretion, conduct a hearing. A request
for a hearing made by claimant will be given full consideration. At such
hearing, the claimant shall be entitled to appear and present evidence and be
represented by counsel.

(e) A decision on a request for review shall be made by the Committee not
later than 60 days after receipt of the request; provided, however, in the event
of a hearing or other special circumstances, such decision shall be made not
later than 120 days after receipt of such request. If it is necessary to extend
the period of time for making a decision beyond 60 days after the receipt of the
request, the claimant shall be notified in writing of the extension of time
prior to the beginning of such extension.

(f) The Committee's decision on review shall state in writing the specific
reasons and references to the Plan provisions on which it is based. Such
decision shall be promptly provided to the claimant. If the decision on review
is not furnished in accordance with the foregoing, the claim shall be deemed
denied on review.

11.5 The Committee shall have the power to allocate its responsibilities
among its several members, except that all matters involving the hearing of and
decision on the claims and the review of the determination of benefits shall be
made by the full Committee; provided, however, that no member of the Committee
shall participate in any matter relating solely to himself.

11.6 To the extent required by law, the Committee shall give notice in
writing to all interested parties of any amendment of this Plan and/or Trust
Agreement and of any application to any government agency for any determination
of the effect of any such amendment on the Plan within the jurisdiction of that
agency.

11.7 (a) The Committee shall administer the Plan and the Trust Agreement
forming a part thereof under uniform rules of general application.

(b) The Committee or any member thereof:

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(1) May serve under the Plan and/or the Trust Agreement in one or more
fiduciary capacities, as that term is defined in ERISA; and

(2) May resign by giving written notice thereof to the Chief Executive
Officer of Delaware Group Delaware Fund, Inc. not less than fifteen (15) days
before the effective date of such resignation; and

(3) May be removed at any time, without cause, by the Board of Directors of
Delaware Group Delaware Fund, Inc.

ARTICLE XII

AMENDMENT, CONSOLIDATION, MERGER OR TERMINATION
-----------------------------------------------
12.1 Delaware Group Delaware Fund, Inc. may amend the Plan and the Trust
Agreement in any manner and at any time by action of its Board of Directors;
provided, however, that no amendment shall deprive any Participant or his
Beneficiary of any vested interest he may have hereunder unless the amendment is
for the purpose of conforming the Plan to the requirements of the Code or any
other applicable law. No amendment which affects the rights, responsibilities or
duties of the Trustee may be made without the Trustee's written consent. No
amendment shall be made to the Plan which has the effect of eliminating or
reducing an early retirement benefit or a retirement-type subsidy, eliminating
an optional form of benefit or decreasing a Participant's account balance with
respect to benefits attributable to service before the amendment. Further, if
the vesting schedule of the Plan is amended, in the case of an Employee who is a
Participant as of the later of the date such amendment is adopted or the date it
becomes effective, the nonforfeitable percentage (determined as of such date) of
such Employee's right to his Employer derived account balance will not be less
than his percentage computed under the Plan without regard to such amendment.

12.2 Any Participant on the effective date of an amendment who is not
actively participating in the Plan on such effective date shall not benefit from
an amendment unless otherwise required by law or unless such amendment is
specifically made applicable to such Participant.

12.3 In the event of any merger or consolidation with, or transfer of
assets or liabilities to, any other plan, each Participant shall be entitled to
a benefit after the merger, consolidation or transfer (if the Plan then
terminated) which is not less than the benefits he would have been entitled to
receive immediately before the merger, consolidation or transfer (if the Plan
had then terminated).

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12.4 The Employer intends to continue the Plan indefinitely but reserves
the right to discontinue contributions, terminate or partially terminate the
Plan at any time. In the event of a complete discontinuance of contributions,
termination or partial termination of the Plan, the interests of all
Participants affected shall become nonforfeitable. Upon termination of the Plan,
the Employer shall in its complete discretion notify the Trustee to either hold
all assets of the Trust Fund and make payments in accordance with the terms of
the Plan or distribute to each Participant his net account balance in a lump sum
payment in cash or kind. The Employer's contribution to the Trust Fund or the
income thereof shall not be paid to, or shall not revert to Employer and shall
not be used for any purpose other than the exclusive benefit of the Participants
or their Beneficiaries.

ARTICLE XIII

MISCELLANEOUS
-------------
13.1 To the extent permitted by law, it is a condition of the Plan that the
benefits provided hereunder shall not be subject to assignment, anticipation,
alienation, attachment, levy or transfer, and any attempt to do so shall not be
recognized. The preceding sentence shall also apply to the creation, assignment
or recognition of a right to any benefit payable with respect to a Participant
pursuant to a domestic relations order, unless such order is determined to be a
qualified domestic relations order as defined in Section 414(p) of the Code. If
provided by the terms of a qualified domestic relations order, a distribution of
benefits may be made from the Plan to the alternate payee under such order in a
single lump sum as soon as practicable following the determination by the
Administrative Committee that the order constitutes a qualified domestic
relations order. Payment of benefits may be made to the alternate payee even
though the Participant identified in the order has not attained the earliest
retirement age under the Plan. For purposes of this Section 13.1, the "earliest
retirement age" means the earlier of (i) the date in which the Participant is
entitled to a distribution under the Plan or (ii) the later of the date the
Participant attains age 50 or the earliest date on which the Participant would
begin receiving benefits if the Participant separated from service.

13.2 Nothing herein contained shall be deemed to give any Employee the
right to be retained in the employ of Employer or to interfere with the right of
the Employer to discharge any Employee at any time, nor shall it be deemed to
give the Employer the right to require any Employee to remain in its employ, nor
shall it interfere with the Employee's right to terminate his employment at any
time.

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13.3 All expenses incurred by the Trustees in the administration of the
Fund, including but not limited to the compensation of counsel, accountants,
Trustees, other agents or fiduciaries, shall be charged against the Employer,
unless otherwise paid by the Fund.

13.4 This Plan shall be interpreted in accordance with the laws of the
Commonwealth of Pennsylvania, except to the extent superseded by ERISA as in
effect from time to time.

ARTICLE XIV

LOANS
-----
14.1 The Committee, in its sole discretion, may direct the Trustees to make
a loan to a Participant, who is a party-in-interest, as defined in Section 3(14)
of ERISA, from the Participant's account balance upon receipt of a written
request from the Participant. The total amount of any such loan (when added to
the outstanding balance of all other loans to the Participant under the Plan or
any other qualified plan of the Employer) shall not exceed the lesser of $50,000
or 50% of the Participant's vested account balance. The $50,000 limitation shall
be reduced by the excess, if any, of the highest outstanding balance of loans to
the Participant from the Plan during the one-year period ending on the day
before the date on which such loan was made over the outstanding balance of
loans from the Plan to the Participant on the date that such loan was made.

14.2 A request by a Participant for a loan shall be made in writing to the
Committee and shall specify the amount of the loan. The terms and conditions on
which the Committee shall approve loans under the Plan shall be applied on a
reasonably equivalent basis with respect to all Participants. If a Participant's
request for a loan is approved by the Committee, the Committee shall furnish the
Trustees with written instructions directing the Trustees to make the loan in a
lump sum payment of cash to the Participant. In making any loan payment under
this Article XIV, the Trustees shall be fully entitled to rely on the
instructions furnished by the Committee, and shall be under no duty to make any
inquiry or investigation with respect thereto.

14.3 Loans shall be made on such terms and subject to such limitations as
the Committee may prescribe from time to time, provided that any such loan shall
be evidenced by a written note, shall bear a reasonable rate of interest on the
unpaid principal thereof, shall be adequately secured, and shall be repaid by
the Participant over a period not to exceed five years.
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14.4 Any loan to a Participant under the Plan shall be secured by the
pledge of not more than 50% percent of the Participant's right, title and
interest in his vested account balance. Such pledge shall be evidenced by the
execution of a promissory note by the Participant.

14.5 The Committee shall have the sole responsibility for insuring that a
Participant timely makes all loan repayments, and for notifying the Trustees in
the event of any default by the Participant on the loan. Each loan repayment
shall be paid to the Trustees, and shall be accompanied by written instructions
from the Committee that identifies the Participant on whose behalf the loan
repayment is being made. Repayment of loans shall be made solely by means of
payroll deductions, or such other manner approved by the Committee.

14.6 In the event of a default by a Participant on a loan repayment, all
remaining principal payments on the loan shall be immediately due and payable.
The Committee shall be authorized (to the extent permitted by law) to take any
and all actions necessary and appropriate to enforce collection of an unpaid
loan. However, in the event of a default, foreclosure on the note and attachment
of security will not occur until a distributable event occurs under the Plan.

14.7 Upon the occurrence of a Participant's retirement or death, or earlier
distribution of benefits, the unpaid balance of any loan, including any unpaid
interest, shall be deducted from any payment or distribution from the Trust Fund
to which such Participant or his Beneficiary may be entitled and his vested
interest in his account shall be reduced.

14.8 A loan to a Participant shall be considered an investment of the
separate account(s) of the Participant from which the loan is made. All loan
repayments shall be credited to such separate account(s) and reinvested in the
investment company fund designated by the Participant.

14.9 A loan may not be made to a Participant who owns (or is considered as
owning within the meaning of Section 318(a)(1) of the Internal Revenue Code)
more than 5% of the outstanding stock of the Employer.

14.10 For loans granted or renewed on or after the last day of first Plan
Year beginning on or after January 1, 1989, the Committee shall issue written
loan guidelines, which shall form part of the Plan, describing the procedures
and conditions for making loans, and may revise those guidelines at any time,
and for any reason.

-35-

<PAGE>

ARTICLE XV

LIMITATIONS ON ALLOCATIONS
--------------------------
15.1 The provisions of this Article XV shall be effective for limitation
years beginning after December 31, 1986.

(a) Notwithstanding any provisions of this Plan to the contrary, the annual
additions which may be credited to a Participant's account for any limitation
year will not exceed the lesser of the maximum permissible amount or any other
limitation contained in this Plan.

(b) As soon as is administratively feasible after the end of the limitation
year, the maximum permissible amount for the limitation year will be determined
on the basis of the Participant's actual compensation for the limitation year.

(c) In the event that it is determined that because of the allocation of
forfeitures, a reasonable error in estimating a Participant's annual
compensation or under other limited facts and circumstances permitted by the
Commissioner of the Internal Revenue Service, if there is an excess amount the
excess will be disposed of as follows:

(1) If the Participant is covered by the Plan at the end of the limitation
year, the excess amount shall be used to reduce employer contributions
(including any allocation of forfeitures) for such Participant in the next
limitation year, and each succeeding limitation year if necessary;

(2) If the Participant is not covered by the Plan at the end of the
limitation year, the excess amount will be held unallocated in a suspense
account. The suspense account will be applied to reduce future employer
contributions (including allocation of any forfeitures) for all remaining
Participants in the next limitation year, and each succeeding limitation year if
necessary;

(3) If a suspense account is in existence at any time during the limitation
year pursuant to this Section, it will not participate in the allocation of
investment gains and losses. The entire amount allocated to Participants from a
suspense account, including any such gains or other income or less any losses is
considered an annual addition.

(d) For the purpose of applying the limitations under this Article, all
defined contribution plans maintained by the employer are to be considered as a
single plan.

15.2 Definitions. For purposes of this Article only, the following
definitions and rules of interpretation will apply:

-36-

<PAGE>

(a) "annual additions" -- The sum of the following amounts credited to a
Participant's account for the limitation year:

(1) employer contributions;

(2) forfeitures;

(3) voluntary Employee contributions;

(4) amounts allocated after March 31, 1984, to an individual medical
account, as defined in Section 415(1)(1) of the Code, which is part of a pension
or annuity maintained by the employer;

(5) amounts derived from contributions paid or accrued after December 31,
1985, in taxable years ending after such date, which are attributable to
post-retirement medical benefits allocated to the separate account of a key
employee, as defined in Section 419A(d)(3) of the Code, under a welfare benefit
fund as defined in Section 419(e) of the Code, maintained by the employer; and

(6) excess amounts applied under this Article in the limitation year to
reduce employer contributions.

(b) "compensation" -- a Participant's earned income, wages, salaries, and
fees for professional services and other amounts received (without regard to
whether an amount is paid in cash) for personal services actually rendered in
the course of employment with the employer to the extent that the amounts are
includable in gross income (including, but not limited to, commissions paid
salesmen, compensation for services on the basis of a percentage of profits,
commissions on insurance premiums, tips, bonuses, fringe benefits,
reimbursements and expense allowances), and excluding the following:

(1) Employer contributions to a plan of deferred compensation which are not
includable in the Employee's gross income for the taxable year in which
contributed, or Employer contributions under a simplified employee pension to
the extent such contributions are deductible by the Employee, or any
distributions from a plan of deferred compensation;

(2) Amounts realized from the exercise of a nonqualified stock option, or
when restricted stock (or property) held by the Employee either becomes freely
transferable or is no longer subject to a substantial risk of forfeiture;

(3) Amounts realized from the sale, exchange or other disposition of stock
acquired under a qualified stock option; and

-37-

<PAGE>

(4) Other amounts which received special tax benefits, or contributions
made by the employer (whether or not under a salary reduction agreement) towards
the purchase of an annuity described in Section 403(b) of the Code (whether or
not the amounts are actually excludable from the gross income of the Employee);
and

(5) Any contribution for medical benefits (within the meaning of Section
419A(f)(2) of the Code) after separation from service which is otherwise treated
as an annual addition; and

(6) Any amount otherwise treated as an annual addition under Section
415(i)(1) of the Code.

For purposes of applying the limitations of this Article, compensation for
a limitation year is the compensation actually paid or includable in gross
income during such year.

Notwithstanding the preceding sentence, compensation for a Participant who
is permanently and totally disabled (as defined in Section 37(e)(3) of the Code)
is the compensation such Participant would have received for the limitation year
if the Participant had been paid at the rate of compensation paid immediately
before becoming permanently and totally disabled; such imputed compensation for
the disabled Participant may be taken into account only if the Participant is
not an officer, an owner, or highly compensated, and contributions made on
behalf of such Participant are nonforfeitable when made.

(c) "employer" -- The Employer that adopts this Plan, and all members of a
controlled group of corporations (as defined in Section 414(b) of the Code as
modified by Section 415(h) of the Code), all commonly controlled trades or
businesses (as defined in Section 414(c) of the Code as modified by Section
415(h) of the Code), or affiliated service groups (as defined in Section 414(m)
of the Code) of which the adopting Employer is a part.

(d) "excess amount" -- The excess of the Participant's annual additions for
the limitation year over the maximum permissible amount.

(e) "limitation year" -- Effective April 2, 1989, the twelve-month period
beginning April 2 and ending April 1. Prior to April 2, 1989, the limitation
year is the twelve-month period from November 1 through the following October
31, except the limitation year beginning November 1, 1988 shall end April 1,
1989.

-38-

<PAGE>

(f) "maximum permissible amount" -- The lesser of $30,000 (or, if greater,
1/4 of the dollar limitation in effect under Section 415(b)(1)(A) of the Code)
or twenty-five percent (25%) of the Participant's compensation for the
limitation year.

ARTICLE XVI

TOP HEAVY DEFINITIONS AND RULES
-------------------------------
16.1 Key employee. An Employee or former Employee, (or the Beneficiary of
such an Employee or former Employee) who at any time during the determination
period was:

(a) An officer of the Employer having an annual compensation greater than
fifty percent (50%) of the amount in effect under Section 415(b)(1)(A) of the
Code for any such Plan Year;

(b) One of the ten Employees having annual compensation from the Employer
of more than the limitation in effect under Section 415(c)(1)(A) of the Code and
owning (or considered as owning within the meaning of Section 318 of the Code)
the largest interests in the Employer;

(c) A person owning (or considered as owning within the meaning of Section
318 of the Code) more than five percent (5%) of the outstanding stock of the
Employer or stock possessing more then five percent (5%) of the total combined
voting power of ail stock of the Employer, or

(d) A person who has annual compensation from the Employer of more than
$150,000 and who would be described in (c) hereof if one percent (1%) were
substituted for five percent (5%).

For purposes of (a) above, no more than fifty (50) Employees (or, if lesser, the
greater of three or ten percent of the Employees will be treated as officers.)
For purposes of (b), if two Employees have the same interest in the Employer,
the Employee having greater annual compensation from the Employer will be
treated as having a larger interest. For purposes of this Article the term
"compensation" shall have the same meaning as provided for in Article XV.

The determination period is the Plan Year containing the determination date
as defined in Section 16.8, and the four (4) preceding Plan Years. The
determination of who is a key employee will be made in accordance with the rules
and regulations under Section 416(i)(1) of the Code.

16.2 Non-key employee. Any Employee who is not a key employee. In addition,
any Beneficiary of a non-key employee will be treated as a non-key employee.

-39-

<PAGE>

16.3 Permissive aggregation group. The required aggregation group of plans
plus any other plan or plans of the Employer, which considered as a group with
the required aggregation group, would continue to satisfy the requirements of
Sections 401(a)(4) and 410 of the Code.

16.4 Required aggregation group.

(a) Each qualified plan of the Employer in which at least one key employee
participates or participated at any time during the determination period
(regardless of whether the plan has terminated), and

(b) Any other qualified plan of the Employer which enables a plan described
in (a) to meet the requirements of Sections 401 (a)(4) and 410 of the Code.

16.5 Top-heavy plan. This Plan is top-heavy for any Plan Year if any of the
following conditions exist;

(a) If the top-heavy ratio for this Plan exceeds sixty percent (60%) and
this Plan is not part of any required aggregation group or permissive
aggregation group of plans.

(b) If this Plan is part of a required aggregation group of plans but not
part of a permissive aggregation group and the top-heavy ratio for the required
aggregation group of plans exceeds sixty percent (60%).

(c) If this Plan is a part of a permissive aggregation group of plans and
the top-heavy ratio for the required aggregation group exceeds sixty percent
(60%) and the top-heavy ratio for the permissive aggregation group exceeds sixty
percent (60%).

16.6 Super top-heavy plan. For any Plan Year in which this Plan would be a
Top-Heavy Plan pursuant to Section 16.5 above if "ninety percent (90%)" were
substituted for "sixty percent (60%)" at each place where "sixty percent (60%)"
appears therein.

16.7 Top-heavy ratio.

(a) If the Employer maintains one or more defined contribution plans
(including any simplified employee pension plan) and has not maintained any
defined benefit plan which during the five (5) year period ending on the
determination date has or has had accrued benefits, the top-heavy ratio for this
Plan alone or for the required or permissive aggregation group as appropriate is
a fraction, the numerator of which is the sum of the account balances of all key
employees as of the determination date (including any part of any account
balance distributed in the five (5) year period ending on the determination

-40-

<PAGE>

date), and the denominator of which is the sum of all account balances
(including any part of any account balance distributed in the five (5) Year
period ending on the determination date), both computed in accordance with
Section 416 of the Code and the regulations thereunder. Both the numerator and
denominator of the top-heavy ratio are increased to reflect any contribution not
actually made as of the determination date, but which is required to be taken
into account on that date under Section 416 of the Code and the regulations
thereunder.

(b) If the Employer maintains one or more defined contribution plans
(including any simplified employee pension plan) and maintains or has maintained
one or more defined benefit plans which during the five (5) year period ending
on the Determination Date has or has had any accrued benefits, the top-heavy
ratio for any required or permissive aggregation group as appropriate is a
fraction, the numerator of which is the sum of account balances under the
aggregated defined contribution plan or plans for all key employees determined
in accordance with (2) above, and the present value of accrued benefits under
the aggregated defined benefit plan or plans for all key employees as of the
determination date, and the denominator of which is the sum of the account
balances under the aggregated defined contribution plan or plans for all
Participants, determined in accordance with (a) above, and the present value of
accrued benefits under the aggregated defined benefit plan or plans for all
Participants as of the determination dates, all determined in accordance with
Section 416 of the Code and the regulations thereunder. The accrued benefits
under a defined benefit plan in both the numerator and denominator of the
top-heavy ratio are increased for any distribution of an accrued benefit made in
the five year period ending on the determination date.

(c) For the purposes of (a) and (b) above, the value of account balances
and the present value of accrued benefits will be determined as of the most
recent valuation date that falls within or ends with the twelve (12) month
period ending on the determination date, except as provided in Section 416 of
the Code and the regulations thereunder for the first and second plan years of a
defined benefit plan. The account balances and accrued benefits of a Participant
(1) who is a non-key employee but who was a key employee in a prior year, or (2)
who has not been credited with at least one Hour of Service with any Employer
maintaining the Plan at any time during the five (5) year period ending on the
determination date will be disregarded. The calculation of the top-heavy ratio,
and the extent to which distributions, rollovers, and transfers are taken into
account will be made in accordance with Section 416 of the Code and the
regulations thereunder. When aggregating plans the value of account balances and
accrued benefits will be calculated with reference to the determination dates
that fall within the same calendar year. If any individual has not received
-41-

<PAGE>

any compensation from any employer maintaining the plan (other than benefits
under the Plan) at any time during the five (5) year period ending on the
determination date, any accrued benefit for such individual (and the account
of such individual) will not be taken into account.

Effective for Plan Years beginning after December 31, 1986, the accrued
benefit of a Participant other than a key employee shall be determined under (i)
the method, if any, that uniformly applies for accrual purposes under all
defined benefit plans maintained by the Employer or (ii) if there is no such
method, as if such benefit accrued not more rapidly than the slowest accrual
rate permitted under the fractional rule of Section 411(b)(1)(C) of the Code.

16.8 Determination date. With respect to any Plan Year subsequent to the
first Plan Year, the last day of the preceding Plan Year. For the first Plan
Year of the Plan, the last day of that Plan Year.

16.9 Valuation date. The last day of the Plan Year.

16.10 Present value. Present value will be based upon the interest and
mortality rates specified in the Employer's defined benefit plan.

16.11 Minimum Allocation.

(a) If in any Plan Year the Plan is a Top Heavy Plan and the Employer does
not maintain any qualified defined benefit plan in addition to this Plan, except
as provided in (b) and (c) below, the Employer contributions and forfeitures
allocated on behalf of any Participant who is a non-key employee will not be
less than the lesser of three percent (3%) of such Participant's compensation or
the largest percentage of Employer contributions and forfeitures, as a
percentage of the first $200,000 of the key employee's compensation (as defined
in Section 15.2(b)), and as limited by Section 401(a)(17) of the Code, allocated
on behalf of any key employee for that year. The minimum allocation is
determined without regard to any Social Security contributions. This minimum
allocation will be made even though, under other Plan provisions, the
Participant would not otherwise be entitled to receive an allocation, or would
have received a lesser allocation for the year because of the Participant's
failure to complete 1,000 Hours of Service. The minimum allocation (if any)
required under this paragraph (a) shall be made to this Plan only to the extent
such allocation is not made for the Participant under any other defined
contribution plan(s) maintained by the Employer.

-42-

<PAGE>

(b) In the event the Employer maintains a qualified defined benefit plan(s)
in addition to this Plan, the Employer will provide a minimum allocation at
least equal to five percent (5%) of compensation (as defined in Section 15.2(b))
to each non-key employee, entitled under (a) above to receive a minimum
allocation, who is covered under this Plan and the qualified defined benefit
plan(s). If this Plan enables a defined benefit plan to meet the requirements of
Section 401(a) or 410 of the Code, the minimum allocation described in (a) above
must be at least three percent (3%) of a Participant's compensation, regardless
of the largest percentage of Employer contributions and forfeitures of a key
employee's compensation.

(c) The provisions in (a) and (b) above will not apply to any Participant
who was not employed by the Employer on the last day of the Plan Year.

(d) The minimum allocation required under this Section 16.11 (to the extent
required to be nonforfeitable under Section 416(b) of the Code) may not be
forfeited under Sections 411(a)(3)(B) or 411(a)(3)(D) of the Code.

IN WITNESS WHEREOF, Delaware Group Delaware Fund, Inc. has caused this
amended and restated Plan, effective April 1, 1989, to be executed by its duly
authorized officers and its corporate seal to be impressed hereon this 17th day
of November, 1994.

Attest: DELAWARE GROUP DELAWARE FUND, INC.

/s/ George M. Chamberlain, Jr. By: /s/Brian F. Wruble
------------------------------ -------------------------
George M. Chamberlain, Jr. Brian F. Wruble
Senior Vice President/Secretary President and Chief
Executive Officer

-43-

<PAGE>
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. 13 to the Registration Statement (Form N-1A)
(No. 33-11419) of Delaware Group Value Fund of our report dated January 6,
1995, included in the 1994 Annual Report to Shareholders of Delaware Group
Value Fund.

/s/ ERNST & YOUNG LLP
---------------------

Philadelphia, Pennsylvania
September 12, 1995

<PAGE>

DELAWARE
GROUP
----------
IRA APPLICATION
AND TRANSFER FORM

|| PERSONAL IRA
|| SPOUSAL IRA
|| ROLLOVER IRA
(PHOTO OF LARGE KEY) || DIRECT ROLLOVER
|| PARTICIPANT'S SEP/IRA
|| PARTICIPANT'S SARSEP
||=======================================

RETIREMENT
LOGO PLANNING
IS THE KEY

<PAGE>

Welcome to the Delaware Group
DELAWARE Before completing your Individual Retirement Account (IRA)
GROUP Application, please review the following points so you can
========== take advantage of the many options available to you with
your Delaware Group Account.
________________________________________________________________________________

To Open Your Delaware Group IRA:

When opening both a Personal and Spousal IRA be sure to complete a separate
application for yourself and for your non-working spouse. The overall maximum
for both accounts is $2,250 per year with no more than $2,000 in either account.

When making Your Investment Selection, talk to your financial adviser to
determine whether Class A shares or Class B shares are more appropriate for you.
Please indicate which fund, or funds, you have selected for your IRA investments
by checking the appropriate selection box next to the fund(s). There is no limit
to the number of funds you may select as long as you meet the required minimum
investment of $25 per fund. And there is only one $15 annual maintenance fee,
regardless of the number of funds you select for your Delaware Group IRA. This
fee can either be prepaid by you, or debited from your IRA account. Your initial
contribution must total $250.

When making your contribution by check, make your check payable to: Delaware
Management Trust Company, the Custodian of your Delaware Group IRA.

If this is a Rollover IRA, and you received a distribution check made payable to
you, be sure to sign and endorse the back of the check, "Payable to Delaware
Management Trust Company."

For Direct Rollovers, in which he plan assets flow directly from the former
trustee/custodian to Delaware Management Trust Company, please be sure to
complete the separate "Direct Rollover" form included with this package.
Checks representing Direct Rollover assets should be made payable to Delaware
Management Trust Company.

Send your completed and signed Application, along with your contribution and/or
Transfer of Assets or Direct Rollover instructions to:

Delaware Service Company, Inc.
Attn: Retirement Plans Department
1818 Market Street
Philadelphia, PA 19103-3682

Additional IRA Services

To establish an Automatic Investing Plan, where regularly scheduled
contributions are taken directly from your personal checking account and
invested into your Delaware Group IRA, call our offices at the telephone number
listed below. Your Shareholder Services Representative will explain this
valuable program of automatic investing and send you the appropriate sign-up
materials.

If you wish to begin taking systematic withdrawals from your account, you will
also need to complete a Retirement Plan Systematic Withdrawal Plan Form. This
service is available for Class A shares only. Just call the telephone number
listed below to request the form.

If you are 70 1/2 or older and need to take Required Distributions from your
account, please ask for an IRA Required Distribution Election Form. Shareholders
cannot roll over or transfer the minimum amount they are required to receive
during a distribution calendar year.

For Simplified Employee Pension/IRA and
Salary Reduction SEP Participants:

SEP/IRA and SARSEP Participants can also arrange to open a personal Delaware
Group IRA at the same time they establish their plan participant account. No
matter how many different Delaware Group IRAs you open, you only pay one $15
annual maintenance fee.

If you are an Employer Participant in the plan, be sure to complete the
appropriate Employer Adoption Agreement as well as the Participant IRA
Application.

If you have any questions or would like assistance
in completing the Individual Retirement Account Application, please call us at
800-523-1918. In Philadelphia, call 215-988-1241.

Again, welcome to the Delaware Group.

<PAGE>

DELAWARE
GROUP
======== Individual Retirement Account Application =======

1 __________________________________ || || ||-|| ||-|| || || ||
Information Name Social Security Number
About You __________________________________ _____/______/_____
Address Date of Birth
Please __________________________________ ( )_____________( )__________
print. City State Zip Phone: Business Home

===============================================================================

2
Type of IRA
Check one.

| | Personal IRA ($2,000 annual limit)
| | Spousal IRA ($2,250 overall limit for you and your non-working spouse with
no more than $2,000 in either account. Separate applications required.)
| | Rollover IRA (No dollar limit; complete Rollover Information section below
and on page 4 of this Application)
| | Transfer of Assets (No dollar limit; complete the Transfer of Assets Form on
page 7 of this Application)
| | SEP/IRA -- Simplified Employee Pension/IRA Plan ($30,000 overall limit).
Must be accompanied by a Delaware Group SEP Plan Establishment Document
completed by the Employer.
| | Self-Directed SEP/IRA -- Simplified Employee Pension/IRA Plan ($30,000
overall limit). Must be accompanied by IRS Form 5305-SEP.
| | SARSEP -- Salary Reduction SEP/IRA Plan ($8,994 salary deferral limit in
1993, indexed each year). Must be accompanied by a Delaware Group SARSEP
Plan Establishment Document completed by the Employer.
| | Self-Directed SARSEP -- Salary Reduction SEP/IRA Plan ($8,994 salary
deferral limit in 1993, indexed each year). Must be accompanied by IRS Form
5305A-SEP.
For SEP/IRA & SARSEP plans, please complete the following:

________________________________________________________________________________
Company Name

________________________________________________________________________________
Address of Employer

________________________________________________________________________________
City State Zip

| | | | - | | | | | | | | | | | | | |
Employer Tax I.D. Number
| | Check here if you are a new participant in an existing
SEP/IRA or SARSEP plan.
<TABLE>
<CAPTION>
====================================================================================================================================
(Employer Contribution) (Salary
IRA SEP/IRA Reduction
Current Prior Rollover/ Current Prior Contribution)
3 Year Year Transfer Year Year SARSEP
------------------- --------- ------------------ --------------
<S> <C> <C> <C> <C> <C> <C>
Your
Investment Initial Contribution $_____ $_____ $_____ $_____ $_____ $_____
Selections Delaware Group -- Equity Funds
| | Decatur Income || Class A
Minimum initial Fund || Class B _____% _____% _____% _____% _____% _____%
contribution: | | Decatur Total || Class A
$250. Minimum Return Fund || Class B _____% _____% _____% _____% _____% _____%
investment per | | DelCap Fund || Class A
fund: $25. || Class B _____% _____% _____% _____% _____% _____%

Remember to | | Trend Fund || Class A
check off your || Class B _____% _____% _____% _____% _____% _____%
fund(s) selection. | | Value Fund || Class A
|| Class B _____% _____% _____% _____% _____% _____%
Please do not | | International || Class A
use fractional Equity Fund || Class B _____% _____% _____% _____% _____% _____%
percentages, for | | Dividend || Class A
example 33 1/3, Growth Fund || Class B _____% _____% _____% _____% _____% _____%
and be sure | | Delaware Fund || Class A
percentages || Class B _____% _____% _____% _____% _____% _____%
total 100% Income Funds
| | Delchester Fund || Class A
Investing for || Class B _____% _____% _____% _____% _____% _____%
prior year can | | U.S. Govt. Fund || Class A
only be done || Class B _____% _____% _____% _____% _____% _____%
prior to the tax | | Treasury Reserves || Class A
filing deadline. Intermediate Fund || Class B _____% _____% _____% _____% _____% _____%
If no year is Money Market Funds
designated, | | Delaware || Class A
current year will Cash Reserve || Class B _____% _____% _____% _____% _____% _____%
be assumed. || Consultant Class

| | U.S. Govt. || Class A
Money Fund || Consultant Class_____% _____% _____% _____% _____% _____%
Other
| | __________ || Class A
|| Class B _____% _____% _____% _____% _____% _____%
| | __________ || Class A
|| Class B _____% _____% _____% _____% _____% _____%
TOTALS 100% 100% 100% 100% 100% 100%

</TABLE>

<PAGE>

================================================================================
4 Source of Your Contribution

| | Contribution by Check -- Total Dollar Amount of Initial Investment: $______
| | IRA to IRA Transfer of Assets -- Make sure you complete and sign the
attached Transfer of Assets Form on page 7.
| | Director Rollover -- Complete and sign the enclosed Direct Rollover Form.
| | Broker-Placed Phone Order

________________________________________________________________________________
Delaware Confirmation Number

________________________________________________________________________________
Order Date

________________________________________________________________________________
Number of Shares

________________________________________________________________________________
Name of Fund

| | Contributing from an Existing Delaware Group Account -- convert $__________
from my regular fund account #________________to this IRA account. If your
regular fund account is registered as a joint account, we require a
signature guarantee from the joint owner.

================================================================================
5 Rollover Information Complete all that apply. Includes Direct Rollovers from
Qualified plans or 403(b)s.

| | IRA Rollover -- I hereby elect to treat this contribution as a rollover
contribution. I understand that this is an irrevocable election. The source
of the rollover is from:
| | A Qualified Plan
| | A 403(b) Plan
| | Another IRA
| | A Qualified Plan or IRA or 403(b) by Beneficiary (spouse only)
| | Death Benefit IRA -- Surviving spouse does not elect to treat the death
benefit rollover as his or her own IRA
| | Rollover IRA -- Surviving Spouse does elect to treat the death benefit
rollover as his or her own IRA
| | Rollover after age 70 1/2 -- Pursuant to IRS Regulations, I hereby certify
that I am not rolling over any minimum amount required to be distributed to
me with respect to any applicable distribution calendar year. In order to
receive required minimum distributions in the future under your Delaware
Group IRA, please contact the Delaware Group and we will send you an IRA
Required Distribution Election Form.

================================================================================

6 Additional Services for Your Consideration

These optional services are available as special elections for your Delaware
Group IRA.

Consult the prospectus(es) of the fund(s) for more details on the terms of these
optional services.

If you have further questions, ask your financial adviser or call us at
800-523-1918. In Philadelphia call 215-988-1241.

| | Wealth Builder Option -- I authorize Delaware Group to transfer $__________
($100 or more) per month, through liquidation of shares in this fund, to one
or more other Delaware Group funds ($100 minimum per fund) under this IRA.
Note: For Class A accounts, Wealth Builder transactions must be directed to
another Class A account. For Class B accounts, Wealth Builder transactions
must be directed to another Class B account.

_______________________________________________________________________________
Name of Fund from Section 3

_______________________________________________________________________________
New Fund (new account will be established)

$_______________________________________________________________________________
Amount per month

| | Dividend Maximizer -- Dividends and any capital gains are reinvested in the
same fund automatically unless otherwise indicated. I elect to have
dividends and any capital gains under this IRA invested in another IRA
account.

| | New Account -- Name of Fund ________________________________________________

| | Systematic Withdrawal Plan -- If you wish to begin receiving periodic
distributions (available for Class A accounts only) under the Terms and
Conditions of the IRA, please contact our office and we will send you a
Retirement Plan Systematic Withdrawal Plan Form. Please note, if you are age
70 1/2 or older, you should request an IRA Required Distribution Election
Form.

| | Combined Purchases Privilege -- This privilege allows the combining of
shares currently owned in other non-money market Delaware Group funds with
the dollar amount of this IRA Account to determine a reduced sales charge,
if applicable.

Name of Fund Account Number Number of Shares
_____________________ _________________________________________________

_____________________ _________________________________________________

| | Letter of Intention -- This option allows the aggregation of anticipated
purchases by an individual in non-money market Delaware Group funds during a
13-month period, along with any existing assets listed in the Combined
Purchase Privilege Section, to obtain a reduced sales charge. This option is
available for funds with front-end sales charges only, though Class B shares
can be used for purposes of filling Class A Letters of Intention. To learn
more, please see your Fund's current prospectus and sales charge breakpoint
schedule. I have read and agree to the terms of the prospectus(es) of the
fund(s) I have selected on this application, and wish to establish a Letter
Of Intent, although I am not obligated to do so, where my investments in
non-money market funds will aggregate or exceed:

| | $100,000 | | $250,000 | | $500,000 | | $1,000,000

I understand that if I do not satisfy the investment level selected above
that my account will be adjusted to reflect the applicable sales charge.

Note to SEP/IRA SARSEP Participants: A separate Letter Of Intent Form must be
completed by your employer, on behalf of all participants in the Plan, to obtain
a reduced sales charge.

<PAGE>

If this is not a Personal or Spousal IRA, please contact Your financial adviser
or Delaware Group before completing this section.

| | Automatic Investing Plan -- Please transfer $____ ($25 or more for A Shares,
$100 or more for B Shares) from my bank account each month to invest in
_________________________________________. Date of Transfer each month:
Fund Name
| | 1st | | 5th | | 10th | | 15th | | 20th | | 25th

________________________________________________________________________________
Bank Name Bank Account #

________________________________________________________________________________
Name(s) on Bank Account

While we cannot guarantee that your bank will accept this offer, we will ask for
its cooperation. If you discontinue this plan at any time, and your banking
registration has not changed, we can reinstate it immediately via written or
telephone request.

Attach a voided check or deposit slip to avoid delays in processing.

================================================================================

7 Agreement And Beneficiary Designation

Your signature is required.

You can change your Beneficiary Designation at any time by completing a Change
of Beneficiary Designation Form and returning it to Delaware Service Company,
Inc. 1818 Market St. Philadelphia, PA 19103-3682.

Contact Delaware Group for the appropriate Change of Beneficiary Form.

By signing below, I designate the following person(s) to receive any benefit
from my Individual Retirement Account which may become due upon or after my
death according to the terms and conditions of the Plan. I understand that this
Beneficiary Designation will remain in full force and effect unless and until I
revoke this designation by completing a Change of Beneficiary Designation Form
for the Delaware Group Individual Retirement Custodial Account at a later date
and returning it to the Custodian.

Pay to: Primary Beneficiary ___________________________%

_______________________________________________________________________________
Name

_______________________________________________________________________________
Address

_______________________________________________________________________________
City State Zip

____________________________________________________ ____/_____/____________
Relationship Date of Birth

| | | | | | - | | | | - | | | | | | | |
Social Security Number

If more than one Primary Beneficiary is selected and no percentage of plan
benefits is indicated, the assets will be divided equally between the Primary
Beneficiaries.

If no Beneficiary is designated, assets will be paid to your estate.

If the Custodian receives satisfactory proof that the Primary Beneficiary is
deceased, or if more than one Primary Beneficiary is selected and both are
deceased, the assets will be paid to the Contingent Beneficiary as indicated.

Pay to: Primary Beneficiary ___________________________%

_______________________________________________________________________________
Name

_______________________________________________________________________________
Address

_______________________________________________________________________________
City State Zip

____________________________________________________ ____/_____/____________
Relationship Date of Birth

| | | | | | - | | | | - | | | | | | | |
Social Security Number
<PAGE>

Pay to: Contingent Beneficiary ___________________________%

_______________________________________________________________________________
Name

_______________________________________________________________________________
Address

_______________________________________________________________________________
City State Zip

____________________________________________________ ____/_____/____________
Relationship Date of Birth

| | | | | | - | | | | - | | | | | | | |
Social Security Number

If you are married and you do not designate your spouse as your sole Primary
Beneficiary, you should consult with an attorney as to whether applicable law
may require your spouse to sign a written consent to your designation or a
written declaration to give up community or marital property interests in your
IRA. The Custodian shall have no responsibility for determining whether your
Beneficiary Designation is valid under applicable law and shall have no
liability to any person for acting in accordance with your Beneficiary
Designation.

===============================================================================

By signing below, I hereby establish an Individual Retirement Account under
Section 408(a) of the Internal Revenue Code of 1986, as amended, ("the
Code") to provide for my retirement and for the support of my beneficiaries
after my death. I hereby acknowledge receipt of the Terms and Conditions and
Disclosure Statement for the Individual Retirement Account required under the
Income Tax Regulations under Section 408(i) of the Code and am in receipt of an
effective prospectus(es) for the Fund(s) I am investing in. I hereby appoint
Delaware Management Trust Company as Custodian and agree to pay the annual
maintenance fee, currently $15. (If this fee is not included or is not paid by
April 30th annually, it will be debited from your account each May.)

X ___________________________________________ _______________________________
Investor's Signature Date
===============================================================================
Please send your completed and signed application, along with your contribution,
to Delaware Service Company, Inc., Attn: Retirement Plan Department, 1818 Market
Street, Philadelphia, PA 19103-3682. Be sure to make your check payable to
Delaware Management Trust Company.

<PAGE>

================================================================================
Broker Information
To be completed by Investment Dealer.

________________________________________________________________________________
Name of Brokerage Firm

________________________________________________________________________________
Home Office Address

________________________________________________________________________________
Authorized Firm Signature

________________________________________________________________________________
Representative's Name/Number

________________________________________________________________________________
Branch Office Address

________________________________________________________________________________
Representative's Phone Number
================================================================================

Custodian Acceptance
For use by Custodian only.

/s/ Diane Anderson
________________________________________________________________________________
Authorized Officer of Delaware Management Trust Company

================================================================================
DELAWARE
GROUP
=======

The Delaware Group Of Funds

Delaware's family of funds enables investors to match their needs with a broad
range of investment objectives covering the risk-reward spectrum. The following
are available as investment vehicles for any Delaware Group retirement program.

| | Trend Fund
Seeks long-term capital appreciation by investing in securities issued by
small, growth-oriented companies exhibiting a strong potential for capital
appreciation.

| | DelCap Fund
Seeks long-term growth by investing in common stocks and securities
convertible into common stocks of mid-sized companies that have demonstrated
their ability to grow and demonstrate a potential for continued growth.

| | Value Fund
Seeks long-term growth by investing primarily in common stocks of small and
mid-size companies whose market values appear low relative to their
underlying value or potential value.

| | International Equity Fund
Seeks long-term growth without undue risk to principal by investing
primarily in a range of foreign equity securities that have potential for
capital appreciation and income.

| | Decatur Income Fund
Seeks highest possible current income by investing primarily in common
stocks of established companies with strong dividend histories that provide
the potential for income and capital appreciation without undue risk to
principal.

| | Decatur Total Return Fund
Seeks long-term total return by investing primarily in securities that
provide the potential for income and capital appreciation without undue risk
to principal.

| | Dividend Growth Fund
Seeks current income and capital appreciation by investing primarily in
income-producing common stocks. Focuses on common stocks believed to have
the potential for above-average dividend increases over time.

| | Delaware Fund
Seeks long-term growth through a balance of capital appreciation, income and
preservation of capital. Invests in common stock and investment grade bonds.

| | U.S. Government Fund
Seeks high current income consistent with safety of principal through
investment in securities issued by the U.S. government, its agencies or
instrumentalities.

| | Delchester Fund
Seeks high current income as is consistent with reasonable safety by
investing primarily in high-yielding, lower rated corporate bonds, U.S.
government securities and commercial paper issued by companies with the
ability to pay interest and repay principal.

| | Treasury Reserves Intermediate Fund
Seeks to provide a high, stable level of income with a high degree of
principal stability through investments in short- and intermediate-term
securities issued or guaranteed by the U.S. government, its agencies and
instrumentalities.

| | U.S. Government Money Fund
Seeks a high current income with a goal of maintaining a constant share
price by investing in short-term securities issued and/or guaranteed by the
U.S. government, its agencies and instrumentalities.

| | Delaware Cash Reserve
Seeks high current income with a goal of maintaining a constant share price
by investing in high-quality money market instruments with maturities of no
more than one year.

All funds, except U.S. Government Money Fund, currently offer Class A and B
shares. Please consult your financial adviser about which class is more
appropriate for you.

===============================================================================
The Delaware Group investor can seek total return through equity-oriented
investments, stability and current income through fixed-income investments, or
combine these styles to achieve the desired investment balance. As the
investor's needs or objectives change, the exchange privilege enables
investments to be transferred from one fund to another within the Delaware Group
without losing their tax-advantaged status.

<PAGE>

DELAWARE
GROUP
========

IRA Transfer of Assets Form
Use this form to transfer your IRA assets to a Delaware Group IRA. If you don't
have an existing Delaware Group IRA, please fill out an application. If you are
transferring IRA assets from more than one custodial account, please complete a
separate Transfer Form for each transfer. Please note, you must complete a
separate Transfer of Assets Form for each plan trustee/ custodian and/or for
each CD maturity date, if applicable. If you wish to make a direct rollover of
assets from a qualified plan or 403(b), please complete a Direct Rollover form.
================================================================================
Information About Your Delaware Group IRA

_______________________________________________________________________________
Individual's Name

_______________________________________________________________________________
Address

_______________________________________________________________________________
City State Zip

(__________)___________________________________________________________________
Telephone: Home

(__________)___________________________________________________________________
Business

| | | | | | - | | | | - | | | | | | | |
Social Security Number

Select One

| | 1. This is a transfer to a new Delaware Group IRA. My investment choices are
on page 3 of this IRA application.

| | 2. Invest the amount to be transferred into my existing Delaware Group IRA
as follows:

Information About Your IRA to Be Transferred

_______________________________________________________________________________
Name of Present Custodian

_______________________________________________________________________________
Address

_______________________________________________________________________________
City State Zip

___________________________________ (____________)_________________________
Contact Person Phone Number

IRA Account # _________________________________________________________________

Investment Fund # _____________________________________________________________

For Certificates of Deposit:

_______________________________________________________________________________
Maturity Date

| | Please do not transfer until my CD matures.
| | Please roll over immediately. I am aware of the early withdrawal penalty.

Type of account you are transferring: | | Personal | | Rollover IRA (With
Qualified Plan or 403(b) assets) | | SEP or SARSEP Please note, you must
complete a separate Transfer of Assets Form for each plan trustee/custodian
and/or for each maturity date, if applicable. If you wish to make a direct
rollover of assets from a qualified plan of 403(b), please complete a Direct
Rollover form.
================================================================================

Your Authorization to Transfer

Your present Custodian may require additional documentation such as a
signature guarantee. Please check with them for their requirements.

<PAGE>

I have established an IRA with Delaware Management Trust Company as the
Custodian. Please roll over the amount listed below to them as successor
Custodian.

| | Complete -- Liquidate ALL of the above referenced account(s)
transfer IN CASH.
| | Partial -- Liquidate assets totaling $ ________________and transfer IN CASH.
| | Re-registration (Transfer in Kind) -- My IRA includes the Delaware Group
fund(s) listed below. Please re-register with Delaware Management Trust
Company as the Custodian. Send Delaware Group any outstanding Delaware Group
Fund certificates and proper documentation to re-register these shares.
Note, the Delaware Management Trust Company can accept only Delaware Group
funds for re-registration.

_____________________________________ _______________________________________
Fund Name Account Number

| | Transfer on or after age 70 1/2 -- Pursuant to IRS Regulations, I hereby
certify that this Transfer will not included any minimum amount required to
be distributed to me with respect to any applicable distribution calendar
year. In order to receive required minimum distributions in the future under
your Delaware Group IRA, please contact the Delaware Group and we will send
you an IRA Required Distribution Election Form.

SIGN HERE

X ____________________________________ _________________________
Your Signature - must be in ink Date
===============================================================================
Custodian Acceptance
For use by Custodian only.

Please be advised that the Delaware Management Trust Company is acting as
Custodian and is willing to accept the proceeds from the above referenced
Custodial Account.

Please make check payable to: Delaware Management Trust
Company, For the Benefit Of: (Participant), and mail to Delaware Management
Trust Company, Transfer of Assets Department, 1818 Market Street, Suite 1604,
Philadelphia, PA 19103-3682.

________________________________________________________ _________________
Authorized Officer of Delaware Management Trust Company Date

<PAGE>

DELAWARE
GROUP
========

Information About Your Delaware Group IRA

_______________________________________________________________________________
Individual's Name

_______________________________________________________________________________
Address

_______________________________________________________________________________
City State Zip

(__________)___________________________________________________________________
Telephone: Home

(__________)___________________________________________________________________
Business

| | | | | | - | | | | - | | | | | | | |
Social Security Number

Select One

| | 1. This is a transfer to a new Delaware Group IRA. My investment choices
are on page 3 of this IRA application.
| | 2. Invest the amount to be transferred into my existing Delaware Group IRA
as follows:
Fund:________ | | Class A | | Class B Percent:_____ Account#:
Fund:________ | | Class A | | Class B Percent:_____ Account#:
Fund:________ | | Class A | | Class B Percent:_____ Account#:
================================================================================

Information About Your IRA to Be Transferred

_______________________________________________________________________________
Name of Present Custodian

_______________________________________________________________________________
Address

_______________________________________________________________________________
City State Zip

___________________________________ (____________)_________________________
Contact Person Phone Number

IRA Account # _________________________________________________________________

Investment Fund # _____________________________________________________________

For Certificates of Deposit:

_______________________________________________________________________________
Maturity Date

| | Please do not transfer until my CD matures.
| | Please roll over immediately. I am aware of the early withdrawal penalty.

Your present Custodian may require additional documentation such as a signature
guarantee. Please check with them for their requirements.

<PAGE>

I have established an IRA with Delaware Management Trust Company as the
Custodian. Please roll over the amount listed below to them as successor
Custodian.

| | Complete -- Liquidate ALL of the above referenced account(s)
transfer IN CASH.
| | Partial -- Liquidate assets totaling $________________ and transfer IN CASH.
| | Re-registration (Transfer in Kind) -- My IRA includes the Delaware Group
fund(s) listed below. Please re-register with Delaware Management Trust Company
as the Custodian. Send Delaware Group any outstanding Delaware Group Fund
certificates and proper documentation to re-register these shares. Note, the
Delaware Management Trust Company can accept only Delaware Group funds for
re-registration.
______________________________________ ________________________________________
Fund Name Account Number

| | Transfer on or after age 70 1/2 -- Pursuant to IRS Regulations, I hereby
certify that this Transfer will not included any minimum amount required to be
distributed to me with respect to any applicable distribution calendar year. In
order to receive required minimum distributions in the future under your
Delaware Group IRA, please contact the Delaware Group and we will send you an
IRA Required Distribution Election Form.

SIGN HERE

X ________________________________________ ____________________________
Your Signature - must be in ink Date

===============================================================================

Custodian Acceptance
For use by Custodian only.
Please be advised that the Delaware Management Trust Company is acting as
Custodian and is willing to accept the proceeds from the above referenced
Custodial Account.

Please make check payable to: Delaware Management Trust Company, For the Benefit
Of: (Participant), and mail to Delaware Management Trust Company, Transfer of
Assets Department, 1818 Market Street, Suite 1604, Philadelphia, PA 19103-3682.

_______________________________________________________ _____________________
Authorized Officer of Delaware Management Trust Company Date

<PAGE>

DELAWARE GROUP

| | Delaware Management Company, Inc.
Investment Manager
| | Delaware Distributors, L.P.
National Distributor
| | Delaware Service Company, Inc.
Shareholder Servicing, Dividend
Disbursing and Transfer Agent
| | Delaware Management Trust Company
Custodian

DELAWARE
GROUP
========

1818 Market Street
Philadelphia, PA 19103-3682
800-523-1918 Nationwide
215-988-1241 in Philadelphia

Use of this material with the public, either in written or oral form, can only
be made in conjunction with the prospectuses of the funds in the Delaware Group
being offered. The prospectus contains further information, including sales
charges and expenses.
Be sure to consult your financial adviser when making investments. Mutual funds
can be a valuable part of your financial plan; however, they are not obligations
of or guaranteed by any bank and are not FDIC or government insured. In
addition, they involve risk, including possible loss of principal.
RL-102-10/94

<PAGE>

DELAWARE
GROUP
========

IRA Direct Rollover Form
Use this form to roll over the assets in your Qualified Plan or 403(b) plan to a
Delaware Group IRA. Please note, you must complete a separate IRA Direct
Rollover Form for each plan trustee/custodian and/or for each CD maturity date,
if applicable.

Information About Your Delaware Group IRA

________________________________________________________________________________
Name

________________________________________________________________________________
Address

________________________________________________________________________________
City State Zip

| | | | | | - | | | | - | | | | | | | |
Social Security Number

(__________)____________________________________________________________________
Phone: Home

(__________)____________________________________________________________________
Phone: Business

| | This is a rollover to a new Delaware Group IRA. My investment choices are
on page 3 of the enclosed IRA application.
| | Invest the amount to be rolled over into my existing Delaware Group IRA
as follows:

Fund Name: _________ Percent/Amt: _________ Account #: __________
Fund Name: _________ Percent/Amt: _________ Account #: __________
Fund Name: _________ Percent/Amt: _________ Account #: __________
================================================================================
Information About Your Qualified Plan or 403(b) to be Rolled Over

________________________________________________________________________________
Name of Employer

________________________________________________________________________________
Address

________________________________________________________________________________
City State Zip

____________________________________(________)__________________________________
Contact Person Phone Number

Account Number: ________________________________________________________________

Type of account: | | Qualified Plan | | 403(b)

For Certificates of Deposit:

________________________________________________________________________________
Maturity Date
| | Please do not roll over until my CD matures.
| | Please roll over immediately. I am aware of the early withdrawal penalty.

Name of Financial Institution:

________________________________________________________________________________

<PAGE>

================================================================================

Your Authorization to Roll Over

Your present Custodian may require additional documentation such as a signature
guarantee. Please check with them for their requirements.

I have established an IRA with Delaware Management Trust Company as the
Custodian. Please roll over the amount listed below to them as IRA Custodian.

| | Partial -- Liquidate assets totaling $___________ and directly roll over
IN CASH.
| | Complete -- Liquidate ALL of the above referenced account(s) and directly
roll over IN CASH.
| | Check here if you are age 70 1/2 or older.
Pursuant to IRS Regulations, I hereby certify that I am not rolling over any
minimum amount required to be distributed to me with respect to any
applicable distribution calendar year. In order to receive required minimum
distributions in the future under your Delaware Group IRA, please contact
the Delaware Group and we will send you an IRA Required Distribution
Election Form.

X ______________________________ __________________
Your Signature - must be in ink Date

================================================================================

Custodian Acceptance

For use by Delaware Management Trust Company only.

Please be advised that the Delaware Management Trust Company, as Custodian, is
willing to accept the proceeds from the above-referenced plan as an IRA account
pursuant to Internal Revenue Code Section 408.

Please make check payable to: Delaware Management Trust Company, For the Benefit
Of: (Participant), Direct Rollover; and mail to Delaware Management Trust Co.,
1818 Market Street, Philadelphia, PA 19103-3682.

________________________________________________________ _______________
Authorized Officer of Delaware Management Trust Company Date

RL-102B - 10/93

<PAGE>
INDIVIDUAL RETIREMENT CUSTODIAL ACCOUNT
TABLE OF CONTENTS

Terms and Conditions
Article I. Contributions ....................... 2
Article II. Nonforfeitability .................. 2
Article III. Prohibited Investments ............ 2
Article IV. Required Distributions ............. 2
1. Required Beginning Date ................... 2
2. Changing Method of Payment ................ 2
3. Lifetime Distributions .................... 3
4. Death Distributions ....................... 3
5. Multiple individual Retirement Accounts ... 4
Article V. Reporting ........................... 4
Article VI. Amendment of Plan .................. 4
Article VII. The Custodian ..................... 4
1. Appointment of Agents ..................... 4
2. No Investment Responsibility .............. 4
3. Entire Contract ........................... 4
4. Delaware Service Company, Inc. ............ 5
5. Designation of Beneficiary ................ 5
6. Taxes and Expenses ........................ 5
7. Termination of Account .................... 5
8. Resignation or Removal of Custodian ....... 5
9. Custodian's Fees .......................... 5
10. Agreements with Investment Advisers ....... 5
11. Applicable Law ............................ 5
Disclosure Statement
Revocation ..................................... 6
Requirements of an Individual Retirement Account 6
Eligibility .................................... 6
Contributions .................................. 7
(A) Deductible Contributions .................. 7
(B) Non-deductible Contributions .............. 8
(C) Spousal IRA Contributions ................. 8
(D) Excess Contributions ...................... 8
(E) Rollover Contributions .................... 9
Distributions .................................. 10
(A) Normal Distributions ...................... 10
(B) Required Distributions .................... 10
(C) Distributions After Death ................. 10
Tax Treatment of Distributions ................. 11
(A) Income Tax ................................ 11
(B) Federal Income Tax Withholding ............ 11
(C) Early Withdrawal Tax ...................... 11
(D) Gift Tax .................................. 12
(E) Estate Tax ................................ 12
Borrowing/Prohibited Transactions .............. 12
Reporting to the IRS ........................... 12
(A) Form 5329 ................................. 12
(B) Form 8606 ................................. 12
IRS Approval ................................... 12
IRA Account Balance ............................ 12
Fees and Charges ............................... 13
(A) IRA Fees .................................. 13
(B) Mutual Fund Sales Charges ................. 13
(C) Redemption and Repurchase Charges ......... 13
(D) Further Details ........................... 13
Qualified Tax Advice ........................... 13

<PAGE>
DELAWARE MANAGEMENT COMPANY, INC.
Individual Retirement Custodial Account

The Delaware Management Company, Inc. Individual Retirement Custodial
Account (the "Plan"), including the Application which is a part thereof, is
established for the exclusive benefit of the individual ("Applicant") designated
in the Application, or his/her beneficiaries.

W I T N E S S E T H:

WHEREAS, the Applicant desires to provide for retirement and for the
support of his/her beneficiaries upon death; and

WHEREAS, to accomplish this purpose, the Applicant desires to establish an
individual Retirement Account (the "Account") as described in Section 408(a) of
the Internal Revenue Code of 1986, as amended, or any successor statute
(hereinafter referred to as "the Code").

NOW, THEREFORE, for the purposes aforesaid, the Account is established,
effective as of the date of the Application, as follows:

ARTICLE I. CONTRIBUTIONS

Except in the case of a rollover contribution described in Sections 402(c),
403(a)(4), 403(b)(8), 408(d)(3) of the Code, or an employer contribution to a
simplified employee pension plan as described in Section 408(k), the Custodian
will only accept cash and will not accept contributions on behalf of the
Applicant in excess of $2,000 for any taxable year. In no event shall the
Custodian accept a rollover of property other than shares of the Delaware Group
of Funds. Rollover contributions before January 1, 1993 include rollovers
described in Sections 402(a)(5), 402(a)(6), 402(a)(7), 403(a)(4), 403(b)(8), or
408(d)(3).

ARTICLE II. NONFORFEITABILITY

The Applicant's interest in the balance in the Account is nonforfeitable.

ARTICLE III. PROHIBITED INVESTMENTS

1. No part of the Account shall be invested in life insurance contracts; nor may
assets of the Account be commingled with other property except in a common trust
fund or common investment fund (within the meaning of Section 408(a)(5) Code).

2. No part of the Account shall be invested incollectibles as defined in
Section 408(m) of the Code.

ARTICLE IV. REQUIRED DISTRIBUTIONS

1. Required Beginning Date. The Applicant's interest in the Account will be
distributed to him/her upon his/her providing Delaware Service Company, Inc.
with instructions as to the method of distribution. The entire interest of the
Applicant in the Account must be or commence to be distributed no later than the
first day of April following the calendar year in which the Applicant attains
age 70 1/2 (the "Required Beginning Date"). Not later than the Required
Beginning Date, the Applicant may elect to have the balance in the Account
distributed:

(a) In a lump sum;

(b) In monthly, quarterly or annual payments or over a period certain not
extending beyond the life expectancy of such Applicant or the joint life
and last survivor expectancy of the Applicant and his/her designated
beneficiary.

2. Changing Method of Payment. Even though distributions may have commenced
pursuant to 1(b) above, the Applicant may receive a distribution of the balance
in the Account in a lump sum or receive distributions under another method of
payment available in 1(b), by providing written notice to Delaware Service
Company, Inc. The Applicant may change the method of payment in 1(b) once a
year, provided: (i) written notice is given to Delaware Service Company, Inc. no
later than December 15 preceding the year in which the method of payment will be
changed and (ii) that distributions are made in accordance with the requirements
of Section 408(a)(6) of the Code and the regulations thereunder.

<PAGE>

3. Lifetime Distributions. If the Applicant is living on his/her Required
Beginning Date, the following distribution provisions shall apply:

(a) Required Minimum Distributions. If the Applicant's entire interest in the
account is to be distributed in a manner other than a lump sum, then the
amount to be distributed each year, commencing with the Required Beginning
Date and each year thereafter, must be at least equal to the quotient
obtained by dividing the Applicant's entire interest in the Account on the
December 31 of the preceding year by the applicable life expectancy.

(b) Minimum Distributions before 1989. For calendar years beginning before
January 1, 1989, if the Applicant's spouse is not the designated
beneficiary, the method of distribution selected must ensure that at least
50% of the present value of the amount available for distribution is paid
within the life expectancy of the Applicant.

(c) Minimum Distributions after 1988. For calendar years beginning after
December 31, 1988, the amount to be distributed each year, beginning with
the first calendar year for which distributions are required and then for
each succeeding calendar year, shall not be less than the quotient obtained
by dividing the balance in the Account as of the preceding December 31 by
the lesser of (1) the applicable life expectancy or (2) if the Applicant's
spouse is not the designated beneficiary, the applicable divisor determined
from the table set forth in Q & A-4 of Section 1.401 (a)(9)-2 of the
Proposed Income Tax Regulations. Distributions after the death of the
Applicant shall be calculated using the applicable life expectancy as the
relevant divisor without regard to Section 1401 (a)(9)-2 of the proposed
regulations.

(d) Computation of Life Expectancy. Life expectancy is computed by use of the
expected return multiples in Tables V and VI of Section 1.72-9 of the
Income Tax Regulations. Unless otherwise elected by the Applicant by the
time distributions are required to begin, life expectancies shall not be
recalculated annually. Such election shall be irrevocable as to the
Applicant and will apply to all subsequent years. The life expectancy of a
non-spouse beneficiary may not be recalculated; rather, life expectancy
shall be calculated using the attained age of the beneficiary during the
calendar year in which distributions are required to begin pursuant to this
Section 3, and payments for subsequent years shall be calculated based on
such life expectancy reduced by one for each calendar year which has
elapsed since the calendar year life expectancy was first calculated.

4. Death Distributions. If the Applicant dies before the entire interest is
distributed, the following distribution provisions shall apply:

(a) Distributions beginning before death. If the Applicant dies after
distribution of his/her interest in the Account has begun, the remaining
portion of such interest will continue to be distributed at least as
rapidly as under the method of distribution being used prior to the
Applicant's death. However, if the designated beneficiary is the
Applicant's surviving spouse, the spouse may elect to treat the Account as
his/her own individual retirement account. This election will be deemed to
have been made if such surviving spouse makes a regular contribution to the
Account, makes a rollover to or from the Account, or fails to elect any of
the provisions in paragraph (b) below. Distributions under this Section 4
are considered to have begun if the distributions are made on account of
the individual reaching his or her required beginning date. If the
individual receives distributions prior to the required beginning date and
the individual dies, distributions will not be considered to begin.

(b) Distributions beginning after death. If the Applicant dies before the
distribution of his/her interest in the Account begins, the Applicant's
entire interest will be distributed by December 31 of the calendar year
containing the fifth anniversary of the applicant's death unless the
applicant elects or, if the Applicant has not so elected, the designated
beneficiary or beneficiaries elect that the entire interest be distributed
in accordance with one of the following three provisions:

(i) The Applicant's entire interest will be distributed over a period
certain not greater than the life expectancy of the Applicant's
designated beneficiary commencing on or before December 31 of the
calendar year immediately following the calendar year in which the
Applicant died. The designated beneficiary may elect at any time to
receive greater payments.

(ii) If the designated beneficiary of the Applicant is the Applicant's
surviving spouse, payments may be made to the surviving spouse over
his/her life expectancy commencing on any date prior to the later of (1)
the December 31 of the calendar year immediately following the calendar
year in which the Applicant died and (2) the December 31

<PAGE>

of the calendar year in which the Applicant would have attained age
70 1/2. The surviving spouse may accelerate these payments at any time
(i.e., increase the frequency or amount of such payments).

(iii) If the designated beneficiary is the Applicant's surviving spouse, the
spouse may elect to treat the Account as his/her own individual
retirement account. This election will be deemed to have been made if
the surviving spouse makes a regular contribution to the Account, makes
a rollover to or from the Account, or fails to elect any of the above
two provisions.

(c) Computation of Life Expectancy. Life expectancy is computed by use of the
expected return multiples in Tables V and VI of Section 1.72-9 of the
Income Tax Regulations. For purposes of distributions beginning after the
Applicant's death, unless otherwise elected by the surviving spouse by the
time distributions are required to begin, life expectancy shall not be
recalculated annually. Such election shall be irrevocable as to the
surviving spouse and shall apply to all subsequent years. In the case of
any other designated beneficiary, life expectancy shall be calculated using
the attained age of the beneficiary during the calendar year in which
distributions are required to begin in accordance with this Section 4, and
payments for any subsequent calendar year shall be calculated based on such
life expectancy reduced by one for each calendar year which has elapsed
since the calendar year life expectancy was first calculated.

5. Multiple individual Retirement Accounts. An individual may satisfy the
minimum distribution requirements described above by receiving a distribution
from one IRA that is equal to the amount required to satisfy the minimum
distribution requirements for two or more IRAs. For this purpose, the owner
of two or more IRAs may use the "alternative method" described in Notice
88-38, 1988-1 C.B. 524, to satisfy the minimum distribution requirements
described above.

ARTICLE V. REPORTING

1. The Applicant agrees to provide the Custodian with information necessary for
the Custodian to prepare any reports required under Section 408(i) of the Code
and related regulations.

2. The Custodian agrees to submit reports to the Internal Revenue Service and
the Applicant as prescribed by the Internal Revenue Service. The Custodian shall
furnish the Applicant with an annual calendar year report concerning the value
of the Account.

ARTICLE VI. AMENDMENT OF PLAN

Delaware Management Company, Inc. may amend this Plan from time to time to
comply with the applicable provisions of the Code and related regulations and
to make any other changes determined by Delaware Management Company, Inc. to
be necessary and desirable.

ARTICLE VII. THE CUSTODIAN

1. Appointment of Agents. The Custodian appoints Delaware Service Company, Inc.
as its agent to receive the Applicant's contributions under this Plan. Delaware
Service Company, Inc., as the Custodian's agent, will deliver the Applicant's
contributions to the Custodian to be invested as provided in the Application.
The Custodian may also appoint one or more broker-dealers as its agent(s),
pursuant to a legally binding agency agreement with such broker-dealer(s), for
purposes of receiving the Applicant's contributions hereunder and receiving
contributions made on behalf of the Applicant pursuant to a simplified employee
pension plan (including a salary reduction SEP).

2. No Investment Responsibility. The Custodian shall have no investment
responsibility or discretion with respect to this Account. The Custodian shall
vote the regulated investment company shares held therein as directed by the
Applicant. If the Applicant does not provide voting instructions to the
Custodian, the Custodian shall vote Account shares in direct proportion to those
voting instructions, on an issue by issue basis, received by the Custodian from
other Individual Retirement Account shareholders of the fund.

3. Entire Contract. This Plan and Application constitute the entire contract
between Applicant and Custodian and, except as provided herein, no
representative of Delaware Management Company, Inc., Delaware Service Company,
Inc., Delaware Distributors, Inc., the Delaware Group of Funds nor any
broker-dealer shall be deemed to be a representative of or acting on
behalf of Custodian, nor shall any such representative have any

<PAGE>

authority to make representations or to bind the Custodian beyond the terms of
this document. The Custodian, Delaware Management Company, Inc., Delaware
Service Company, Inc., Delaware Distributors, Inc., the Delaware Group of Funds
and their affiliates shall not be responsible for any liability arising out of
this Plan and Application except such liability as is occasioned by their own
negligence or wilful misconduct. The Custodian and Delaware Service Company,
Inc. shall not be responsible for any action or omission taken in accordance
with any notice, request, instruction, certificate, beneficiary designation or
other instrument reasonably believed by Custodian or Delaware Service Company,
Inc. to be genuine.

4. Delaware Service Company, Inc. The Custodian may employ Delaware Service
Company, Inc. to carry out certain of the Custodian's administrative
functions hereunder in accordance with an agreement between Custodian and
Delaware Service Company, Inc.

5. Designation of Beneficiary. The Applicant shall have the right, by written
notice to Delaware Service Company, Inc., to designate or to change a
beneficiary to receive any benefit to which the Applicant may be entitled in the
event of death prior to the complete distribution of such benefits. If no such
designation is in effect upon the Applicant's death, the beneficiary shall be
the Applicant's estate. The Custodian and Delaware Service Company, Inc. shall
have no responsibility to determine whether any person or persons other than the
Applicant's designated beneficiary may be entitled, under applicable law, to
receive amounts from the Account on account of the death of the Applicant and
shall have no liability to any person for acting in accordance with Applicant's
beneficiary designation.

6. Taxes and Expenses. Any income taxes or other taxes of any kind whatsoever
that may be levied or assessed upon or in respect to the Account, any transfer
taxes incurred in connection with the investment and reinvestment of the assets
of the Account, other administrative expenses incurred by the Custodian in the
performance of its duties, including fees for legal services rendered to the
Custodian, and the compensation to the Custodian shall be paid from the assets
of the Account, unless paid by the Applicant.

7. Termination of Account. This Account shall terminate upon the complete
distribution of the Account to the Applicant or his/her beneficiaries or to
successor individual retirement accounts or annuities.

8. Resignation or Removal of Custodian. The Custodian may resign at any time
upon ninety (90) days notice in writing to the Applicant and to Delaware
Management Company, Inc. or may be removed by Delaware Management Company,
Inc. at any time upon ninety (90) days notice in writing to the Custodian.
Upon such resignation or removal, Delaware Management Company, Inc. will
appoint a successor Custodian. If within sixty (60) days after the
Custodian's resignation or removal, Delaware Management Company, Inc. has not
appointed a successor Custodian which has accepted such appointment, the
Custodian may appoint such successor itself.

9. Custodian's Fees. The Custodian's fees shall be as published or amended
from time to time.

10. Agreements with Investment Advisers. The Custodian, in its discretion, may
enter into an agreement with an investment adviser, registered under the
Investment Adviser's Act of 1940, for the purpose of redeeming investment
company shares held hereunder to pay for market timer services rendered by the
adviser with respect to the Applicant's Account.

11. Applicable Law. This Plan shall be construed under the laws of the
Commonwealth of Pennsylvania, without giving effect to conflict of laws
principles, and shall become effective only upon execution by Custodian at its
offices in Philadelphia, Pennsylvania. The Custodian shall not be called upon to
take any action outside the Commonwealth of Pennsylvania.

<PAGE>

DISCLOSURE STATEMENT

REVOCATION

You are entitled to revoke your individual retirement account ("IRA"), for
any reason and without penalty, by mailing or delivering written notice of
revocation to Delaware Service Company, Inc. within seven days after your
receipt of the IRA Disclosure Statement or within seven days after you establish
your IRA; however, if your IRA is established more than seven days after receipt
of the IRA Disclosure Statement, you may not revoke your IRA. If you wish to
revoke your IRA, mail or deliver your written notice to Delaware Service Co.,
Inc., Retirement Plans Department, 1818 Market Street, Philadelphia, PA 19103.
If mailed, the revocation notice will be considered mailed on the date of
postmark (or if sent by certified or registered mail, the date of certification
or registration) if it is deposited in the mail in the United States in an
envelope or other appropriate wrapper, first class postage prepaid, properly
addressed. While oral revocations are not accepted, you may contact us at (800)
523-1918 (In Philadelphia call 988-1241) if you have any questions with respect
to this procedure. If you should choose to revoke your IRA, the entire amount of
your contribution will be refunded without adjustment for administrative
expenses or any other amount.

REQUIREMENTS OF AN INDIVIDUAL
RETIREMENT ACCOUNT

An Individual Retirement Account investing contributions in any of the Funds
in the Delaware Group is a Custodial Account created in the United States for
the exclusive benefit of an individual or his/her beneficiaries. The written
instrument creating the Custodial Account must satisfy the following
requirements:

1. Except in the case of a rollover contribution (explained below),
contributions must be in cash and may not exceed $2,000, or $2,250 if a
spousal IRA, for any taxable year;

2. The Custodian must be a bank or other person approved by the Secretary of
the Treasury;

3. No part of the IRA funds may be invested in life insurance contracts;

4. The interest of an individual in the IRA must be nonforfeitable;

5. The assets of the IRA may not be commingled with other property except in
a common trust fund or common investment fund; and

6. The entire interest of an individual must be distributed in accordance with
certain rules (explained below under "Distributions").

ELIGIBILITY

You are eligible to establish and contribute to an IRA for any year in which
you work and receive compensation for such work, provided that you have not
attained age 70 1/2 in the year in question. If eligible, both a husband and
wife may each have their own separate IRA. If either spouse is ineligible to
establish an IRA, because the spouse has no "compensation," the other spouse may
be permitted to establish a Spousal IRA.

"Compensation" includes wages, salaries, professional fees, and other
amounts received for personal services, including such items as commissions paid
to salesmen, compensation for services on the basis of a percentage of profits,
commissions on insurance premiums, tips and bonuses. Compensation also includes
earned income of a self-employed person and any amount includable in an
individual's income as alimony or separate maintenance payments. Compensation
does not include amounts derived from or received as earnings or profits from
property, such as interest, dividends and rent, or any amount not includable in
gross income.

If you satisfy certain requirements, you may also establish an IRA for the
purpose of transferring retirement savings distributed from another individual
retirement account, individual retirement annuity, tax-sheltered annuity or
qualified retirement plan maintained by your employer.

You may have an IRA whether or not you are a participant in any other
retirement plan. However, if you or your spouse are an active participant in
another retirement plan, the amount of your annual contribution which is tax
deductible may be reduced (explained below under "Contributions").

<PAGE>

CONTRIBUTIONS

(A) Deductible Contributions

You may make an annual contribution to your IRA up to a maximum of $2,000(1)
or 100% of your compensation, whichever is less. If neither you nor your spouse
is an "active participant" in an employer maintained retirement plan at any time
during the year, the entire amount of your contribution (within the above
limits) will be tax deductible.

As explained below, if either you or your spouse is an active participant in
an employer maintained retirement plan, but you have adjusted gross income (AGI)
below the "applicable dollar amount," your entire contribution will still be tax
deductible. However, if either you or your spouse is an active participant and
your AGI is above the applicable dollar amount, the amount of your contribution
which is tax deductible will be reduced or eliminated as illustrated by the
chart below:

Tax Deductible Contributions:
Who Qualifies:

If you are not an active participant in
an employer-sponsored retirement plan:
100% deductible at any income level
If you are an active participant in
an employer-sponsored retirement plan:

Adjusted Gross Income Contribution
Married Single Deductibility
--------------- --------------- ---------------
below $40,000 below $25,000 Full
$40,000-$50,000 $25,000-$35,000 Partial
over $50,000 over $35,000 No

In order to be deductible for a taxable year, annual contributions must be
made not later than the due date (without regard to extensions) of your tax
return for the year for which the deduction is claimed.

Definition of Active Participant

You are an "active participant" for a year if you are "covered" by any of the
following retirement plans:

1. A qualified plan described in Section 401(a) of the Internal Revenue Code
(hereinafter the "Code");

2. An annuity plan described in Section 403(a) of the Code;
------------
(1) An additional $250 may be contributed to a Spousal IRA for a total of $2,250
for a working and non-working spouse.

3. A plan established for its employees by the United States, by a state or
local government or by an agency or instrumentality thereof (other than an
eligible deferred compensation plan as defined in Section 457(b) of the Code);

4. An annuity contract or custodial account described in Section 403(b) of
the Code;

5. A simplified employee pension (SEP) and salary reduction SEP described in
Section 408(k) of the Code;

6. A trust described in Section 501(c)(18) of the code.

You are considered "covered" by a retirement plan for a year if your employer
or union has a retirement plan of a type described above under which money is
added to your account or you are eligible to earn retirement credits. You are an
active participant for a year even if you are not yet vested in your retirement
benefit. Also, if you make required contributions or voluntary employee
contributions to a retirement plan, you are an active participant. In certain
plans, you may be an active participant even if you were only with the employer
for part of the year. Your active participant status should be indicated on your
Form W-2.

You are not considered an active participant if you are covered by a plan
only because of your service as (1) an Armed Forces Reservist, for less than
ninety (90) days of active service; or (2) a volunteer fire fighter covered for
fire fighting service by a government plan. Of course, if you are covered under
any other plan, these exceptions do not apply.

If you would like specific advice as to whether you are an active participant
in a retirement plan, you should consult with your attorney or a qualified tax
adviser.

AGI Threshold Level

If you or your spouse are an active participant, you must calculate your
adjusted gross income (AGI) for the year (if you and your spouse file a joint
tax return, you must use your combined AGI) to determine whether your IRA
contribution will be deductible. The instructions to your tax return will show
you how to calculate your AGI for this purpose. If you are at or below a certain
AGI level, called the "Threshold Level," you are treated as if you were not an
active participant and can make a deductible contribution under the same rules
as a person who is not an active participant.

If you are single, your AGI Threshold Level is $25,000. If you are married
and file a joint tax return, the Threshold Level is $40,000. If you are married
but file a separate tax return, the Threshold Level is $0. If you and your
spouse file separate tax returns and you live apart at all times during the
year, both you and your spouse will be treated as single in determining the
deductibility of your IRA contributions and your spouse's IRA contributions.

<PAGE>
Calculation of Deduction Limit

If your AGI is less than $10,000 above your Threshold Level, you will still
be able to make a deductible contribution, but it will be limited in amount. The
amount by which your AGI exceeds your Threshold Level (AGI minus Threshold
Level) is called your Excess AGI. The maximum allowable deduction is $2,000 (or
a total of $2,250 for a Spousal IRA). You may calculate your deduction limit by
using the following formula:

$10,000 -- Excess AGI x Maximum Allowable = Deduction
---------------------
$10,000 Deduction Limit

You must round up the result to the next highest $10 level. For example, if
the result is $1,525, you must round it up to $1,530. If the final result is
below $200 but above $0, your deduction limit is $200. Your deduction limit
cannot, in any event, exceed 100% of your compensation.

The following examples illustrate the above formula.

Example One: Bob, a single individual, is an active participant in his
employer's retirement plan and has AGI of $28,000. Bob has contributed $2,000 to
his IRA for the current year. Bob will calculate the deductible portion of his
IRA contribution as follows:

1. Bob must first determine the amount of his Excess AGI. His Excess AGI is
equal to his AGI minus his Threshold Level. Because Bob is a single
individual his Threshold Level is $25,000. Thus, his Excess AGI is $3,000
($28,000 -- $25,000).

2. Bob will now determine his deduction limit as follows:

$10,000 -- $3,000 x $2,000 = $1,400
----------------
$10,000

Example Two: Jack and Jane are a married couple who file a joint income tax
return and have a combined AGI of $45,000. Jack is not covered by his employer's
retirement plan. Jane is an active participant in her employer's retirement
plan. Jack and Jane have each contributed $2,000 to their separate IRAs. Jack
and Jane will calculate the deductible portion of their contributions as
follows:

1. Jack and Jane must first determine the amount of their Excess AGI. Since they
are a married couple filing a joint return their Threshold Level is $40,000.
Thus, their Excess AGI is $5,000 ($45,000 -- $40,000).

2. Jack and Jane will each determine their individual deduction limit as
follows:

$10,000 -- $5,000 x $2,000 = $1,000
----------------
$10,000

(B) Non-deductible Contributions

Even if your deduction limit is less than $2,000 ($2,250 for a Spousal IRA),
you may still contribute to your IRA up to the lesser of 100% of your
compensation or $2,000 ($2,250 for a Spousal IRA). The amount of your
contribution which is not deductible will be treated as a non-deductible
contribution to your IRA. You may also choose to treat a contribution as
non-deductible even if you could have deducted part or all of the contribution.
Interest or other earnings on your contribution, whether from deductible or non-
deductible contributions, will not be taxed until distributed to you from the
IRA.

You may make your $2,000 contribution at any time during the year, if your
compensation for the year will be at least $2,000, without having to designate
at such time how much of your contribution will be deductible. When you complete
your tax return, you must then determine how much of your contribution is
deductible. If you determine that all or a portion of your contribution is
non-deductible, you must report such amount to the Internal Revenue Service on
your tax return for the year.

If you and your spouse file a joint income tax return and your spouse either
has no compensation for the taxable year or elects to be treated as having no
compensation for the taxable year, you may establish an IRA for the benefit of
your spouse. If you make contributions on behalf of yourself and your spouse for
a given tax year, the aggregate amount of the contributions to both your IRA and
your spouse's IRA may not exceed the lesser of $2,250 or the amount of your
compensation for such year. The contribution does not have to be split equally
between the IRAs belonging to you and your spouse. However, the total
contributions to either of your IRAs may not exceed $2,000.

You are not permitted to make contributions to your IRA in the year in which
you attain age 70 1/2 and subsequent years; however, you may continue to deduct
contributions to your non-working spouse's IRA until the year in which your
spouse reaches age 70 1/2.

(D) Excess Contributions

If you make a contribution to your IRA in excess of the deductible and
non-deductible limits, whichever is applicable, such amount is an "excess
contribution." A non-deductible 6% excise tax is imposed upon the excess
contribution for the year in which it is made and also for each following year
until it is eliminated. However, the amount of the tax for any year cannot
exceed 6% of the value of your IRA as of the close of the tax year.

You may avoid the imposition of such 6% tax if you withdraw any excess
contributions from your IRA before the due date for filing your federal

<PAGE>
tax return (not including extensions) for the year for which the excess
contribution is made. The earnings attributable to the excess contribution also
must be withdrawn by that date and must be included in your gross income in the
year for which the excess contribution was made. A timely withdrawal of the
excess contributions will permit you to avoid not only the 6% excise tax but
also the 10% penalty tax on premature distributions.

A withdrawal of an excess contribution after the tax return filing date will
avoid the 10% penalty tax on premature distributions, provided that the total
contribution for the year did not exceed $2,250 and no deduction was allowed for
the excess contribution.

As an alternative to withdrawing such excess contribution, you may eliminate
the excess by reducing your future annual contributions below the maximum
allowable amount. However, you will continue to be subject to the 6% excise tax
for each year until the excess contribution is completely eliminated.

(E) Rollover Contributions

A rollover contribution must consist of cash or other assets distributed from
one retirement program and "rolled over" tax free to another. There are two
types of rollover contributions to an IRA. The first type involves the
distribution of cash or other assets from one IRA which is "rolled over" to
another IRA. For this purpose, the term "IRA" includes individual retirement
accounts and individual retirement annuities. The second type involves the
distribution of cash or other assets from a tax-sheltered annuity or custodial
account or from a qualified retirement plan which is "rolled over" to an IRA. A
rollover contribution is neither includable in your income nor deductible.
Unlike annual contributions, rollover contributions are not subject to the
annual $2,000 limitation (or $2,250 in the case of the Spousal IRA) or 100% of
compensation limitation. A rollover contribution may not include any minimum
amounts required to be distributed to you during the calendar year in which you
attain age 70 1/2 or during any subsequent year. A rollover contribution must be
in cash or in shares of the Delaware Group of Funds.

IRA to IRA

If you receive a distribution from another individual retirement account or
individual retirement annuity, you may redeposit all or part of the amount you
receive into your IRA. You must roll over such amount within the sixty (60)-day
period following your receipt of the distribution in order for such amount to
qualify for rollover treatment and in order for such amount to avoid being
treated as a taxable distribution. Amounts not rolled over may also be subject
to the 10% penalty tax on premature distributions. A surviving spouse
beneficiary of an IRA may roll over a distribution from the IRA to the spouse's
own IRA; a non-spouse beneficiary is not eligible to roll over such a
distribution.

A rollover from each separate individual retirement account or individual
retirement annuity is allowed only once a year. The one-year period begins on
the date that you receive the distribution and not on the date it is rolled over
into another IRA. A rollover from one IRA to another should not be confused with
a direct transfer of your IRA assets from one IRA custodian or trustee to
another IRA custodian or trustee. A transfer from one IRA custodian to another
is not considered a rollover and, consequently, is not affected by the
once-a-year limitation on rollovers.

Qualified Retirement Plan to IRA

You may also be eligible for tax-free rollover treatment when you receive a
distribution from your employer's qualified retirement plan or from a
tax-sheltered annuity or custodial account.

In order to qualify for tax-free rollover treatment, a distribution from a
qualified retirement plan must constitute an "eligible rollover distribution."

Any distribution from an employer-sponsored tax-qualified retirement plan or
tax-sheltered annuity or custodial account will qualify as an eligible rollover
distribution unless it is one of the following:

(i) A distribution which is one of a series of substantially equal periodic
payments (not less frequently than annually) made for the life (or life
expectancy) of the employee or the lives (or joint life expectancies) of
the employee and the employee's designated beneficiary, or for a specified
period of 10 years or more.

(ii) The portion of a distribution representing the minimum annual distribution
required after an employee attains age 70 1/2 or dies.

(iii) The non-taxable portion of a distribution representing after-tax
contributions to the plan.

(iv) Certain corrective distributions of elective deferrals, after-tax
contributions and matching contributions.

(v) A distribution to a non-spouse beneficiary of a deceased participant.

(vi) A distribution pursuant to a qualified domestic relations order to an
alternate payee who is neither the participant's spouse or former spouse.

(vii) A distribution to a surviving spouse to the extent the distribution is
subject to the Death Benefit Exclusion under Code section 101(b).
9
<PAGE>
If an eligible rollover distribution is paid to you, it wiII be subject to
mandatory 20% federal income tax withholding. You cannot elect to waive this
withholding tax, even if you intend to take advantage of tax-free rollover
treatment. If cash is available from some other source equal to the amount
withheld and you transfer that amount plus the net amount of the distribution to
your IRA within sixty (60) days after the distribution, no portion of the
eligible rollover distribution will be taxable to you. You may be entitled to a
full refund of the 20% withheld, depending upon your tax situation for the year.
If you roll over only the amount of the distribution actually received by you
and do not roll over an amount equal to the 20% withheld, you will be taxed on
the 20% withheld, and may be subject to a 10% additional tax on premature
distributions if you are younger than age 59 1/2.

However, the 20% withholding can be avoided by making a "direct rollover" to
your IRA. A direct rollover is a direct payment by the distributing
tax-qualified retirement plan or tax-sheltered annuity or custodial account to
your IRA rather than to you. If your eligible rollover distribution is at least
$200, your employer's plan must give you the option to make a direct rollover of
your eligible rollover distribution to an IRA.

The eligible rollover distribution rules also apply to distributions to a
surviving spouse who is a beneficiary of a deceased participant. These rules
also apply to distributions to a spouse or former spouse who is an alternate
payee with respect to a participant's benefits under a qualified domestic
relations order.
DISTRIBUTIONS

The IRA distribution rules are similar to the rules for distributions from
qualified retirement plans, in accordance with proposed regulations issued by
the Secretary of the Treasury. As of the date of issuance of this Disclosure
Statement, the regulations have not been finalized. Accordingly, the description
below of the distribution rules will be subject to modification upon issuance of
final regulations.

(A) Normal Distributions

Your IRA is intended to provide a source of income to you upon your
retirement on or after age 59 1/2 or if you become disabled. Distributions other
than amounts rolled over into another IRA or qualified plan are taxed as
ordinary income in the year received by you. With certain exceptions,
distributions which occur prior to age 59 1/2 will be subject to a 10%
additional tax on premature distributions (explained below).

(B) Required Distributions

While distributions from your IRA may commence any time, such distributions
must commence on or before the first day of April of the year following the year
in which you attain age 70 1/2 (known as the "Required Beginning Date").
Distributions must be paid to you in accordance with one of the following
methods:

(i) A single lump sum payment; or

(ii) In monthly, quarterly or annual payments over a period certain not
extending beyond your life expectancy or the joint and last survivor
expectancy of you and your designated beneficiary.

Even though distributions may have commenced in the method explained in
option (ii) above, you may receive a distribution of the balance in your IRA at
any time. Distributions may be received in a single payment or in installment
payments (but distributions which will be rolled over must exclude any minimum
amount required to be distributed during that calendar year).

If you elect to have your IRA distributed in other than a single payment, the
amount to be distributed each year, beginning with the first calendar year for
which distributions are required and for each succeeding year, must be at
least equal to the amount determined by dividing the entire amount of your IRA
as of the preceding December 31 by your life expectancy or by the joint and last
survivor life expectancies of you and your designated beneficiary. If your
designated benficiary is not your spouse and is more than 10 years younger than
you, your beneficiary will be treated as if he/she were only 10 years younger
than you for purposes of determining the joint life expectancy of you and your
beneficiary. In order to enforce such minimum distribution requirements, a 50%
tax is imposed on the amount, if any, by which the minimum required distribution
exceeds the actual amount distributed. If the failure to make the minimum
distribution is due to a reasonable error and steps are taken to remedy such
error, the 50% tax may be waived by the Internal Revenue Service.

If you have more than one IRA, you can satisfy the minimum distribution
requirements by taking from one IRA the amount required to satisfy the
requirement for all other IRAs.

At the time that you establish your IRA, you have the right to select a
beneficiary who will be entitled to receive the balance in your IRA if you
should die prior to the complete distribution of your IRA. You have the right,
prior to the complete distribution of your IRA, to change your designation of
beneficiary. If you fail to properly designate a beneficiary, your estate will
be treated as your designated beneficiary.
10

<PAGE>

If you should die after the distribution of your IRA has commenced, the
remaining portion of your IRA will continue to be distributed at least as
rapidly as under the method of distribution being used prior to your death. If
you should die before the distribution of your IRA has commenced, the entire
interest in your IRA must be distributed in accordance with one of the following
provisions:

(i) The entire balance of your IRA is distributed by the December 31 of the
year containing the fifth anniversary of your death;

(ii) If the balance of your IRA is payable to a designated beneficiary, such
amount may be distributed in substantially equal periodic installments
over the life expectancy of the beneficiary commencing no later than the
December 31 of the year after your death;

(iii) If the designated beneficiary is your surviving spouse, your spouse may
elect to receive periodic payments over his/her life expectancy,
commencing at any date prior to the later of (1) the December 31 of the
year following your death or (2) the December 31 of the year in which you
would have attained age 70 1/2;

(iv) If the designated beneficiary is your surviving spouse, your spouse may
elect to treat your IRA as his/her own IRA and receive distributions under
the general distribution rules discussed above.

TAX TREATMENT OF DISTRIBUTIONS

(A) Income Tax

As a general rule, distributions from your IRA are taxable to you as ordinary
income. However, if non-deductible contributions have been made to your IRA,
the portion of your IRA distribution consisting of non-deductible contributions
will not be taxed again when received by you. If you make any non-deductible IRA
contributions, each distribution from your IRA will consist of a non-taxable
portion (return of non-deductible contributions) and a taxable portion (return
of deductible contributions, if any, and earnings). Thus, you may not take a
distribution which is entirely tax-free. The following formula is used to
determine the non-taxable portion of your distributions for a tax year:

Non-deductible Non-taxable
Contributions x Total Distribution = Distributions
---------------------- (for the year) (for the year)
Year-end IRA Balance

In determining your year-end IRA balance, you add back all distributions
taken during the year.

The following example illustrates how you will determine the non-taxable
portion of your distributions for a taxable year.

Example: Mary has made the following contributions to her IRA:

YEAR DEDUCTIBLE NON-DEDUCTIBLE
1985 $2,000 $0
1986 $2,000 $0
1987 $2,000 $0
1988 $1,000 $1,000
1989 $0 $2,000
------ ------
$7,000 $3,000

During 1990, Mary receives a $1,000 distribution from her IRA. On December
31, 1990 the total value of Mary's IRA is $11,000. The non-taxable portion of
the distribution she received during 1990 is determined as follows:

$3,000 x $1,000 = $250
--------------
11,000 + 1,000

To determine your year end balance you treat all of your IRAs as a single
IRA. This includes all regular IRAs, as well as simplified employee pension
(SEP) IRAs, salary reduction SEPs, and rollover IRAs.

A single lump sum distribution from your IRA is not entitled to special
10-year averaging, five-year averaging or capital gains treatment.

(B) Federal Income Tax Withholding

Distributions from your IRA are subject to Federal income tax withholding
unless the recipient elects in writing that no taxes be withheld. If the total
account balance or a portion of the account balance is distributed, then the
withheld amount will equal 10% of the distribution. If the distribution is part
of a series of periodic payments, the withheld amount will be calculated as if
the distribution were wages, and Form W-4P must be completed.

In general, distributions from your IRA which occur prior to age 59 1/2 will
be subject to adverse tax consequences. Not only will such distributions be
fully taxable to you as ordinary income (subject to the formula described above
for determining the non-taxable portion of your distribution), such
distributions will also be subject to a 10% additional premature distribution
tax.

In addition to the exceptions for rollovers and the return of excess
contributions discussed above, distributions on account of your death or
disability will be exempt from the 10% additional tax. You are considered

<PAGE>

disabled if you are unable to engage in any substantial gainful activity because
of a medically determinable physical or mental impairment which can be expected
to result in death or to be of long, continued and indefinite duration. In
addition, distributions before age 59 1/2 are not subject to the 10% tax if made
in the form of substantially equal periodic payments and are made for your life
(or life expectancy) or the joint lives (or joint life expectancies) of you and
your designated beneficiary.

A transfer of amounts held in your IRA to your spouse's or former spouse's
IRA pursuant to a divorce or separation instrument will not be taxable as
ordinary income or subject to the 10% additional tax.

(D) Gift Tax

Your designation of a beneficiary for your IRA will not be treated as a gift
and will not subject you to Federal gift taxes.

(E) Estate Tax

Any amounts remaining in your IRA after your death will be included in your
gross estate and may be subject to Federal estate tax.

BORROWING/PROHIBITED TRANSACTIONS

You may not use the IRA or any portion of the IRA as security for a loan. If
you do, the portion pledged as security will be treated as distributed to you,
and will thus be includable in your taxable income for that year. Certain other
transactions (called "prohibited transactions" in the Code) may also result in
the disqualification of your IRA and the inclusion in income of the fair market
value of the IRA. Neither you, nor your beneficiary, may engage in any of the
following prohibited transactions with the IRA:

(a) a sale, exchange, or leasing of any property;

(b) lending of money or other extension of credit;

(d) the transfer or use of income or assets of the IRA by you or your
beneficiary.

If such transactions are engaged in, your IRA will be disqualified and will
lose its tax-exempt status. Under such circumstances, your IRA will be
considered to have been distributed to you and will be subject to the income and
additional taxes discussed above.

REPORTING TO THE IRS

(A) FORM 5329

If a transaction has occurred upon which a special penalty tax is imposed,
such as an excess contribution, a premature distribution or a failure to make a
timely distribution, you are required to file Form 5329 with your income tax
return for the year of the transaction. Form 5329 need not be filed if the only
activity for the year is the making of contributions or the distribution of
permissible benefits.

(B) FORM 8606

You are required to file Form 8606 if you make a non-deductible IRA
contribution.

IRS APPROVAL

The Delaware Group Prototype IRA has previously been approved by the Internal
Revenue Service as to its written form. Since that time, it has been amended to
conform to changes in the law and has been resubmitted to the Internal Revenue
Service for approval. At the time this Disclosure Statement was prepared, the
Internal Revenue Service had not reviewed the amendments.

Please be aware that the Internal Revenue Service's approval is a
determination only as to the form of the IRA and does not represent a
determination as to the merits of your particular IRA.

IRA ACCOUNT BALANCE

Each of the mutual fund shares held in your IRA has an equal interest in the
assets, net investment income and capital gains of the mutual fund selected. The
value of the shares is dependent upon, among other things, the market values of
the securities in the mutual fund's investment portfolio, which are subject to
fluctuation; therefore, growth in the value of your IRA cannot be projected or
guaranteed. Dividends from net investment income and any capital gains
distributions paid by the mutual fund selected will be reinvested in fund shares
at the net asset value thereof as of the respective ex-dividend dates, and such
additional shares will be credited to your IRA.

<PAGE>

FEES AND CHARGES

(A) IRA Fees

In general, there is an annual maintenance fee (currently $15 per year) for
your IRA. If an investor owns more than one Delaware Group IRA or opens a
Delaware Group IRA and invests in multiple funds within the Delaware Group,
however, only one fee per Social Security number will be charged. IRA fees are
deducted from the IRA during May of each year, unless paid directly by the
shareholder to the Custodian prior to May of each calendar year. The IRA fees
are subject to change.

(B) Mutual Fund Sales Charges

A sales charge will be made against your investment except for Delaware Group
Cash Reserve and Delaware Group U.S. Government Money Fund. For investments
under $1 million, sales charge rates range from a maximum of 8.50% to 1.5% of
the offering price of the fund shares. Depending on the Delaware Group fund
selected, the maximum rate applicable to an initial $1,000 contribution would be
8.50%, 5.75%, 4.75% or 3.00%. The maximum rate is applicable to subsequent
contributions of $1,000 until the value of the fund shares meets or exceeds a
level that qualifies the shareholder to receive a reduced sales charge. An
account value of $10,000 reduces the sales charge for funds at the maximum 8.50%
level to 7.75%. The sales charge for funds with a maximum of 5.75% is reduced to
4.75% when the account reaches $100,000.

The sales charge for funds with a maximum of 4.75% is reduced to 3.75% when
the account reaches $100,000. The sales charge for funds with a maximum of 3.00%
is reduced to 2.50% when the account reaches $100,000. Further sales charge
reductions at lower rates are applicable on larger purchases and on purchases
under the fund's Right of Accumulation and Letter of Intention. Group purchases
that meet our minimum standard may be subject to a different sales charge.
Reduced sales charges also apply to the combination of shares of any of the
funds in the Delaware Group (except Delaware Group Cash Reserve and Delaware
Group U.S. Government Money Fund, unless they were acquired through an exchange
or unless the inclusion of such shares brings your total account balance to $1
million) held by you and those held in your IRA.

Neither the fund nor the national distributor makes a charge for redemptions
or repurchases.

(D) Further Details

Please refer to the prospectus of the fund or funds selected as your
investment for further details, including current charges and expenses.

QUALIFIED TAX ADVICE

The above is only a general description of taxation of IRAs. Because of the
unfavorable tax consequences which could result from the improper establishment
or use of an IRA, you may wish to consult with an attorney or qualified tax
adviser. Neither Delaware Management Company, Inc., Delaware Service Co., Inc.,
the Delaware Group of Funds nor the Custodian assumes any liability for tax
consequences to investors or beneficiaries arising from IRAs.

<PAGE>

DELAWARE
GROUP
========
IRA

(PHOTO OF LARGE KEY)

|| PLAN DOCUMENT
|| TERMS AND CONDITIONS
|| DISCLOSURE STATEMENT
||=========================

THE DELAWARE ORGANIZATION
| | Delaware Management Company, Inc.
Investment Manager

| | Delaware Distributors, L.P.
National Distributor

| | Delaware Service Company, Inc.
Shareholder Servicing, Dividend
Disbursing and Transfer Agent

| | Delaware Management Trust Company
Custodian

RETIREMENT
1818 Market Street PLANNING (LOGO)
Philadelphia, PA 19103-3682 IS THE KEY
800-523-4640
In Philadelphia 215-988-1333

RL-101-150M-12/93-U
Printed in the U.S.A.

<PAGE>

CLAIMS PROCEDURE

The Employer shall establish a claims procedure in accordance with the
requirements of the Employee Retirement Income Security Act of 1974, as amended,
if applicable, for the presentation of claims under the terms of the SEP
Document. A claim is a request for a plan benefit, including participation and
contributions, by an Employee or Beneficiary. The Employer shall make all
determinations as to the eligibility of any Employee for plan participation or
Employer contribution. In the event the claim is denied, the Employer shall
provide written notice of its determination to the Employee or Beneficiary
within ninety (90) days after receipt of the claim unless special circumstances
require an extension of time for processing the claim. If such an extension of
time for processing is required, written notice of the extension shall be
furnished to the claimant prior to the termination of the initial 90-day
period. The written notice will be set forth in a manner that may be understood
by the claimant and shall include:

1) The reason for the denial.

2) Specific reference to pertinent plan provisions on which the denial is
based.

3) Additional information necessary for the claimant to perfect the claim and
why the information is necessary.

4) Information about the procedures for submitting the denied claim for
review.

RL-210-1/93-5M-U

<PAGE>
DELAWARE GROUP VALUE FUND A
ANNUALIZED RATE OF RETURN
FOR FISCAL YEAR ENDING 1995
--------------------------------------------------------------------------------

Average Annual Compounded Rate of Return:

n
P(1 + T) = ERV

ONE
YEAR
---------

1
$1000(1 - T) = $1,020.38

T = 2.04%

THREE
YEARS
---------

3
$1000(1 - T) = $1,346.75

T = 10.43%

FIVE
YEARS
---------

5
$1000(1 - T) = $1,839.0

T = 12.96%

LIFE OF
FUND
---------

7.93858822
$1000(1 - T) = $2,715.10

T = 13.41%

<PAGE>

DELAWARE GROUP VALUE FUND A
ANNUALIZED RATE OF RETURN
FOR FISCAL YEAR ENDING 1995
--------------------------------------------------------------------------------

Average Annual Compounded Rate of Return:

n
P(1 + T) = ERV

ONE
YEAR
---------
1
$1000(1 - T) = $961.86

T = -3.81%

THREE
YEARS
---------
3
$1000(1 - T) = $1,269.30

T = 8.27%

FIVE
YEARS
---------
5
$1000(1 - T) = $1,732.90

T = 11.62%

LIFE OF
FUND
---------

7.93858822
$1000(1 - T) = $2,559.35

T = 12.57%

<PAGE>
DELAWARE GROUP VALUE FUND A
TOTAL RETURN PERFORMANCE
THREE MONTHS
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $20.32
Initial Shares 49.213

Ending Shares 49.213
Ending NAV $20.18
---------
Investment Return $993.12

Total Return Performance
------------------------
Investment Return $993.12
Less Initial Investment $1,000.00
---------
($6.88) / $1,000.00 x 100

Total Return: -0.69%

<PAGE>
DELAWARE GROUP VALUE FUND A
TOTAL RETURN PERFORMANCE
SIX MONTHS
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $20.50
Initial Shares 48.780

Ending Shares 49.849
Ending NAV $20.18
----------
Investment Return $1,005.95

Total Return Performance
------------------------
Investment Return $1,005.95
Less Initial Investment $1,000.00
----------
$5.95 / $1,000.00 x 100

Total Return: 0.60%

<PAGE>

DELAWARE GROUP VALUE FUND A
TOTAL RETURN PERFORMANCE
NINE MONTHS
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $21.56
Initial Shares 46.382

Ending Shares 47.399
Ending NAV $20.18
---------
Investment Return $956.51

Total Return Performance
------------------------
Investment Return $956.51
Less Initial Investment $1,000.00
---------
($43.49) / $1,000.00 x 100

Total Return: -4.35%

<PAGE>

DELAWARE GROUP VALUE FUND A
TOTAL RETURN PERFORMANCE
ONE YEAR
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $21.44
Initial Shares 46.642

Ending Shares 47.664
Ending NAV $20.18
---------
Investment Return $961.86

Total Return Performance
------------------------
Investment Return $961.86
Less Initial Investment $1,000.00
---------
($38.14) / $1,000.00 x 100

Total Return: -3.81%

<PAGE>

DELAWARE GROUP VALUE FUND A
TOTAL RETURN PERFORMANCE
THREE YEARS
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $17.21
Initial Shares 58.106

Ending Shares 62.899
Ending NAV x $20.18
---------
Investment Return $1,269.30

Total Return Performance
------------------------
Investment Return $1,269.30
Less Initial Investment $1,000.00
---------
$269.30 / $1,000.00 x 100

Total Return: 26.93%

<PAGE>

DELAWARE GROUP VALUE FUND A
TOTAL RETURN PERFORMANCE
FIVE YEARS
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $13.86
Initial Shares 72.150

Ending Shares 85.872
Ending NAV x $20.18
---------
Investment Return $1,732.90

------------------------
Investment Return $1,732.90
Less Initial Investment $1,000.00
---------

$732.90 / $1,000.00 x 100

Total Return: 73.29%

DELAWARE GROUP VALUE FUND A
TOTAL RETURN PERFORMANCE
LIFE OF FUND
--------------------------------------------------------------------------------
Initial $1,000.00
Investment
Beginning $10.11
OFFER
Initial 98.912
Shares

Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1988 98.912 $0.045 0.506 99.418
--------------------------------------------------------------------------------
1989 99.418 $0.070 0.660 100.078
--------------------------------------------------------------------------------
1990 100.078 $0.860 6.481 106.559
--------------------------------------------------------------------------------
1991 106.559 $0.405 3.816 110.375
--------------------------------------------------------------------------------
1992 110.375 $0.990 6.787 117.162
--------------------------------------------------------------------------------
1993 117.162 $0.860 5.718 122.880
--------------------------------------------------------------------------------
1994 122.880 $0.205 1.226 124.106
--------------------------------------------------------------------------------
1995 124.106 $0.410 2.720 126.826
--------------------------------------------------------------------------------

Ending Shares 126.826
Ending NAV $20.18
----------
Investment Return $2,559.35

Total Return Performance
------------------------
Investment Return $2,559.35
Less Initial Investment $1,000.00
----------
$1,559.35 / $1,000.00 x 100

Total Return: 155.94%

DELAWARE GROUP VALUE FUND INSTITUTIONAL
ANNUALIZED RATE OF RETURN
FOR FISCAL YEAR ENDING 1995
--------------------------------------------------------------------------------
Average Annual Compounded Rate of Return:

n
P(1 + T) = ERV

ONE
YEAR
----

1
$1000(1 - T) = $1,023.80

T = 2.38%

THREE
YEARS
-----
3
$1000(1 - T) = $1,357.48

T = 10.72%

FIVE
YEARS
-----
5
$1000(1 - T) = $1,853.72

T = 13.14%

LIFE OF
FUND
----
7.93858822

$1000(1 - T) = $2,736.71

T = 13.52%

DELAWARE GROUP VALUE FUND INSTITUTIONAL
TOTAL RETURN PERFORMANCE
THREE MONTHS
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $19.20
Initial Shares 52.083

Ending Shares 52.083
Ending NAV $20.24
---------
Investment Return $1,054.16

Total Return
Performance
------------------------
Investment Return $1,054.16
Less Initial Investment $1,000.00
---------
$54.16 / $1,000.00 x 100

Total Return: 5.42%

DELAWARE GROUP VALUE FUND INSTITUTIONAL
TOTAL RETURN PERFORMANCE
SIX MONTHS
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $19.40
Initial Shares 51.546

Total Return Performance
------------------------
Investment Return $1,069.18
Less InitialInvestment $1,000.00
---------
$69.18 / $1,000.00 x 100

Total Return: 6.92%

<PAGE>

DELAWARE GROUP VALUE FUND INSTITUTIONAL
TOTAL RETURN PERFORMANCE
NINE MONTHS
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $20.39
Initial Shares 49.044

Ending Shares 50.261
Ending NAV $20.24
---------
Investment Return $1,017.28

Total Return Performance
------------------------
Investment Return $1,017.28
Less Initial Investment $1,000.00
---------
$17.28 / $1,000.00 x 100

Total Return: 1.73%

<PAGE>

DELAWARE GROUP VALUE FUND INSTITUTIONAL
TOTAL RETURN PERFORMANCE
ONE YEAR
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $20.26
Initial Shares 49.358

Ending Shares 50.583
Ending NAV x $20.24
------
Investment Return $1,023.80

Total Return Performance
------------------------
Investment Return $1,023.80
Less Initial Investment $1,000.00
---------
$23.80 / $1,000.00 x 100

Total Return: 2.3800%

<PAGE>

DELAWARE GROUP VALUE FUND INSTITUTIONAL
TOTAL RETURN PERFORMANCE
THREE YEARS
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $16.22
Initial Shares 61.652

Ending Shares 67.069
Ending NAV x $20.24
------
Investment Return $1,357.48

Total Return Performance
------------------------
Investment Return $1,357.48
Less Initial Investment $1,000.00
---------
$357.48 / $1,000.00 x 100

Total Return: 35.75%

<PAGE>

DELAWARE GROUP VALUE FUND INSTITUTIONAL
TOTAL RETURN PERFORMANCE
FIVE YEARS
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $13.06
Initial Shares 76.570

Ending Shares 91.587
Ending NAV x $20.24
------
Investment Return $1,853.72

------------------------
Investment Return $1,853.72
Less Initial Investment $1,000.00
---------
$853.72 / $1,000.00 x 100

Total Return: 85.37%

<PAGE>

DELAWARE GROUP VALUE FUND INSTITUTIONAL
TOTAL RETURN PERFORMANCE
LIFE OF FUND
--------------------------------------------------------------------------------

Initial Investment $1,000.00
Beginning OFFER $9.53
Initial Shares 104.932

Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1988 104.932 $0.045 12.364 105.469
--------------------------------------------------------------------------------
1989 105.469 $0.070 12.364 106.169
--------------------------------------------------------------------------------
1990 106.169 $0.860 12.364 113.044
--------------------------------------------------------------------------------
1991 113.044 $0.405 12.364 117.092
--------------------------------------------------------------------------------
1992 117.092 $0.990 12.364 124.292
--------------------------------------------------------------------------------
1993 124.292 $0.860 12.364 130.355
--------------------------------------------------------------------------------
1994 130.355 $0.250 12.364 131.939
--------------------------------------------------------------------------------
1995 131.939 $0.465 12.364 135.213
--------------------------------------------------------------------------------

Ending Shares 135.213
Ending NAV x $20.24
------
Investment Return $2,736.71

Total Return Performance
------------------------
Investment Return $2,736.71
Less Initial Investment $1,000.00
---------
$1,736.71 / $1,000.00 x 100

Total Return: 173.67%

<PAGE>

DELAWARE GROUP VALUE FUND B
TOTAL RETURN PERFORMANCE
THREE MONTHS (EXCLUDING CDSC)
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $19.11
Initial Shares 52.329

Ending Shares 52.329
Ending NAV x $20.11
---------
Investment Return $1,052.34

Total Return Performance
------------------------
Investment Return $1,052.34
Less Initial Investment $1,000.00
---------
$52.34 / $1,000.00 x 100

Total Return: 5.23%

<PAGE>

DELAWARE GROUP VALUE FUND B
TOTAL RETURN PERFORMANCE
THREE MONTHS (INCLUDING CDSC)
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $19.11
Initial Shares 52.329

--------------------------------------------------------------------------------

Ending Shares 52.329
Ending NAV x $20.11
---------
$1,052.34
Less CDSC $40.00
---------
Investment Return $1,012.34

Total Return Performance
------------------------
Investment Return $1,012.34
Less Initial Investment $1,000.00
---------
$12.34 / $1,000.00 x 100

Total Return: 1.23%

<PAGE>

DELAWARE GROUP VALUE FUND B
TOTAL RETURN PERFORMANCE
SIX MONTHS (EXCLUDING CDSC)
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $19.30
Initial Shares 51.813

Ending Shares 52.922
Ending NAV x $20.11
---------
Investment Return $1,064.26

Total Return Performance
------------------------
Investment Return $1,064.26
Less Initial Investment $1,000.00
---------
$64.26 / $1,000.00 x 100

Total Return: 6.43%

<PAGE>

DELAWARE GROUP VALUE FUND B
TOTAL RETURN PERFORMANCE
SIX MONTHS (INCLUDING CDSC)
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $19.30
Initial Shares 51.813

Total Return Performance
------------------------
Investment Return $1,024.26
Less Initial Investment $1,000.00
---------
$24.26 / $1,000.00 x 100

Total Return: 2.43%

<PAGE>

DELAWARE GROUP VALUE FUND B
TOTAL RETURN PERFORMANCE
LIFE OF FUND (EXCLUDING CDSC)
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $20.28
Initial Shares 49.310

Ending Shares 50.365
Ending NAV x $20.11
---------
Investment Return $1,012.84

Total Return Performance
------------------------
Investment Return $1,012.84
Less Initial Investment $1,000.00
---------
$12.84 / $1,000.00 x 100

Total Return: 1.28%

<PAGE>

DELAWARE GROUP VALUE FUND B
TOTAL RETURN PERFORMANCE
LIFE OF FUND (INCLUDING CDSC)
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $20.28
Initial Shares 49.310

Ending Shares 50.365
Ending NAV x $20.11
---------
$1,012.84
Less CDSC $39.66
---------
Investment Return $973.18

Total Return Performance
------------------------
Investment Return $973.18
Less Initial Investment $1,000.00
---------

($26.82) / $1,000.00 x 100

Total Return: -2.68%

<ARTICLE> 6
<CIK> 0000809821
<NAME> DELAWARE GROUP VALUE FUND
<SERIES>
<NUMBER> 001
<NAME> VALUE FUND A CLASS

<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> NOV-30-1994 NOV-30-1994
<PERIOD-END> NOV-30-1994 MAY-31-1995
<INVESTMENTS-AT-COST> 181,782,708 171,218,350
<INVESTMENTS-AT-VALUE> 188,108,266 185,332,490
<RECEIVABLES> 578,965 2,190,153
<ASSETS-OTHER> 133 133
<OTHER-ITEMS-ASSETS> 41,238 7,623
<TOTAL-ASSETS> 188,728,602 187,530,399
<PAYABLE-FOR-SECURITIES> 1,252,600 1,660,560
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 137,665 708,373
<TOTAL-LIABILITIES> 1,390,265 2,368,933
<SENIOR-EQUITY> 96,940 91,737
<PAID-IN-CAPITAL-COMMON> 177,143,029 166,896,020
<SHARES-COMMON-STOCK> 9,289,521 8,638,905
<SHARES-COMMON-PRIOR> 7,542,095 9,289,521
<ACCUMULATED-NII-CURRENT> 1,327,257 1,229,263
<OVERDISTRIBUTION-NII> 0 0
<ACCUMULATED-NET-GAINS> 2,444,660 2,829,557
<OVERDISTRIBUTION-GAINS> 0 0
<ACCUM-APPREC-OR-DEPREC> 6,326,449 14,114,889
<NET-ASSETS> 179,498,216 174,360,042
<DIVIDEND-INCOME> 1,801,180 1,048,841
<INTEREST-INCOME> 2,208,906 1,781,287
<OTHER-INCOME> 0 0
<EXPENSES-NET> 2,609,358 1,367,061
<NET-INVESTMENT-INCOME> 1,400,728 1,463,067
<REALIZED-GAINS-CURRENT> 2,439,590 2,799,238
<APPREC-INCREASE-CURRENT> (9,879,689) 7,788,440
<NET-CHANGE-FROM-OPS> (6,039,371) 12,050,745
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 268,712 1,473,990
<DISTRIBUTIONS-OF-GAINS> 1,305,068 2,306,543
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 6,203,942 2,121,441
<NUMBER-OF-SHARES-REDEEMED> 4,527,081 2,962,976
<SHARES-REINVESTED> 70,565 190,919
<NET-CHANGE-IN-ASSETS> 30,478,678 (2,176,867)
<ACCUMULATED-NII-PRIOR> 217,073 1,327,257
<ACCUMULATED-GAINS-PRIOR> 1,356,531 2,444,660
<OVERDISTRIB-NII-PRIOR> 0 0
<OVERDIST-NET-GAINS-PRIOR> 0 0
<GROSS-ADVISORY-FEES> 1,341,214 682,709
<INTEREST-EXPENSE> 0 0
<GROSS-EXPENSE> 2,609,358 1,367,061
<AVERAGE-NET-ASSETS> 174,348,054 174,718,818
<PER-SHARE-NAV-BEGIN> 20.070 19.320
<PER-SHARE-NII> 0.142 0.159
<PER-SHARE-GAIN-APPREC> (0.687) 1.111
<PER-SHARE-DIVIDEND> 0.035 0.160
<PER-SHARE-DISTRIBUTIONS> 0.170 0.250
<RETURNS-OF-CAPITAL> 0 0
<PER-SHARE-NAV-END> 19.320 20.180
<EXPENSE-RATIO> 1.46 1.49
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0

</TABLE>

<ARTICLE> 6
<CIK> 0000809821
<NAME> DELAWARE GROUP VALUE FUND
<SERIES>
<NUMBER> 002
<NAME> VALUE FUND INSTITUTIONAL CLASS

<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> NOV-30-1994 NOV-30-1994
<PERIOD-END> NOV-30-1994 MAY-31-1995
<INVESTMENTS-AT-COST> 181,782,708 171,218,350
<INVESTMENTS-AT-VALUE> 188,108,266 185,332,490
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<ASSETS-OTHER> 133 133
<OTHER-ITEMS-ASSETS> 41,238 7,623
<TOTAL-ASSETS> 188,728,602 187,530,399
<PAYABLE-FOR-SECURITIES> 1,252,600 1,660,560
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 137,665 708,373
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<SHARES-COMMON-STOCK> 329,064 363,845
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<NET-ASSETS> 6,385,226 7,364,541
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<OTHER-INCOME> 0 0
<EXPENSES-NET> 2,609,358 1,367,061
<NET-INVESTMENT-INCOME> 1,400,728 1,463,067
<REALIZED-GAINS-CURRENT> 2,439,590 2,799,238
<APPREC-INCREASE-CURRENT> (9,879,689) 7,788,440
<NET-CHANGE-FROM-OPS> (6,039,371) 12,050,745
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 21,832 74,607
<DISTRIBUTIONS-OF-GAINS> 46,393 86,125
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 155,126 70,809
<NUMBER-OF-SHARES-REDEEMED> 101,287 44,576
<SHARES-REINVESTED> 3,317 8,548
<NET-CHANGE-IN-ASSETS> 30,478,678 (2,176,867)
<ACCUMULATED-NII-PRIOR> 217,073 1,327,257
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<GROSS-EXPENSE> 2,609,358 1,367,061
<AVERAGE-NET-ASSETS> 5,968,510 6,794,084
<PER-SHARE-NAV-BEGIN> 20.140 19.400
<PER-SHARE-NII> 0.195 0.170
<PER-SHARE-GAIN-APPREC> (0.685) 1.135
<PER-SHARE-DIVIDEND> 0.080 0.215
<PER-SHARE-DISTRIBUTIONS> 0.170 0.250
<RETURNS-OF-CAPITAL> 0 0
<PER-SHARE-NAV-END> 19.400 20.240
<EXPENSE-RATIO> 1.16 1.19
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0

</TABLE>

<ARTICLE> 6
<CIK> 0000809821
<NAME> DELAWARE GROUP VALUE FUND
<SERIES>
<NUMBER> 003
<NAME> VALUE FUND B CLASS

<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> NOV-30-1994 NOV-30-1994
<PERIOD-END> NOV-30-1994 MAY-31-1995
<INVESTMENTS-AT-COST> 181,782,708 171,218,350
<INVESTMENTS-AT-VALUE> 188,108,266 185,332,490
<RECEIVABLES> 578,965 2,190,153
<ASSETS-OTHER> 133 133
<OTHER-ITEMS-ASSETS> 41,238 7,623
<TOTAL-ASSETS> 188,728,602 187,530,399
<PAYABLE-FOR-SECURITIES> 1,252,600 1,660,560
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 137,665 708,373
<TOTAL-LIABILITIES> 1,390,265 2,368,933
<SENIOR-EQUITY> 96,940 91,737
<PAID-IN-CAPITAL-COMMON> 177,143,029 166,896,020
<SHARES-COMMON-STOCK> 75,379 170,940
<SHARES-COMMON-PRIOR> 0 75,379
<ACCUMULATED-NII-CURRENT> 1,327,257 1,229,263
<OVERDISTRIBUTION-NII> 0 0
<ACCUMULATED-NET-GAINS> 2,444,660 2,829,557
<OVERDISTRIBUTION-GAINS> 0 0
<ACCUM-APPREC-OR-DEPREC> 6,326,449 14,114,889
<NET-ASSETS> 1,454,891 3,436,883
<DIVIDEND-INCOME> 1,801,180 1,048,841
<INTEREST-INCOME> 2,208,906 1,781,287
<OTHER-INCOME> 0 0
<EXPENSES-NET> 2,609,358 1,367,061
<NET-INVESTMENT-INCOME> 1,400,728 1,463,067
<REALIZED-GAINS-CURRENT> 2,439,590 2,799,238
<APPREC-INCREASE-CURRENT> (9,879,689) 7,788,440
<NET-CHANGE-FROM-OPS> (6,039,371) 12,050,745
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 0 13,004
<DISTRIBUTIONS-OF-GAINS> 0 21,673
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 77,412 119,517
<NUMBER-OF-SHARES-REDEEMED> 2,033 25,706
<SHARES-REINVESTED> 0 1,750
<NET-CHANGE-IN-ASSETS> 30,478,678 (2,176,867)
<ACCUMULATED-NII-PRIOR> 217,073 1,327,257
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<OVERDISTRIB-NII-PRIOR> 0 0
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<PER-SHARE-NAV-BEGIN> 20.280 19.300
<PER-SHARE-NII> 0.011 0.139
<PER-SHARE-GAIN-APPREC> (0.991) 1.071
<PER-SHARE-DIVIDEND> 0.000 0.150
<PER-SHARE-DISTRIBUTIONS> 0.000 0.250
<RETURNS-OF-CAPITAL> 0 0
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<EXPENSE-RATIO> 2.16 2.19
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0

</TABLE>

<PAGE>

Draft 9/12/95

SUBJECT TO BOARD APPROVAL

Delaware Group Value Fund, Inc.

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 Delaware Group Value Fund, Inc. (the "Fund"),
including a majority of the Directors who are not interested persons of the
Fund, pursuant to Rule 18f-3 under the Investment Company Act of 1940, as
amended (the "Act"). The Board has determined that the Plan, including the
expense allocation, is in the best interests of each class of the Fund
individually and the Fund as a whole. The Plan sets forth the provisions
relating to the establishment of multiple classes of shares for the Fund. To the
extent that a subject matter set forth in this Plan is covered by the Fund's
Articles of Incorporation or By-Laws, the Articles of Incorporation and/or
By-Laws will control in the event of any inconsistencies with descriptions
contained in this Plan.

CLASSES

1. The Fund offers four classes of shares, known as Value Fund A Class,
Value Fund B Class, Value Fund C Class and Value Fund Institutional Class.

FRONT-END SALES CHARGE

2. Class A shares carry a front-end sales charge as described in the
Fund's relevant prospectus; and Class B, Class C and Institutional Class shares
carry no front-end sales charge.

CONTINGENT DEFERRED SALES CHARGE

3. Class A shares are not be 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. The CDSC is waived in certain
circumstances, as described in the Fund's relevant prospectus.

<PAGE>

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. The CDSC is waived in
certain circumstances as described in the Fund's relevant prospectus.

5. Class C shares redeemed within twelve months of their purchase shall
be assessed a CDSC at the rate of 1.00% on 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. Institutional Class shares are not subject to a CDSC.

RULE 12b-1 PLANS

7. In accordance with the Fund's Rule 12b-1 Plan for the Class A shares,
the Fund shall pay a monthly fee not to exceed 0.30% per annum of the Fund'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 the Fund to persons other than
broker-dealers (the "Service Providers") pursuant to service agreements.

8. In accordance with the Fund's Rule 12b-1 Plan for the Class B shares,
the Fund shall pay to Delaware Distributors, L.P. (the "Distributor") a monthly
fee not to exceed 0.75% per annum of the Fund'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 to
the Distributor for payment to dealers or others, or directly to others, an
amount not to exceed 0.25% per annum of the Fund's average daily net assets
represented by Class B shares, as a service fee pursuant to dealer or servicing
agreements.

9. In accordance with the Fund's Rule 12b-1 Plan for the Class C shares,
the Fund shall pay to the Distributor a monthly fee not to exceed 0.75% per
annum of the Fund'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 to the Distributor for payment to
dealers or others, or directly to others, an amount not to exceed 0.25% per
annum of the Fund's average daily net assets represented by Class C shares, as a
service fee pursuant to dealer or servicing agreements.

-2-

<PAGE>

10. The Fund has not adopted a Rule 12b-1 Plan for the Institutional
Class shares.

ALLOCATION OF EXPENSES

11. The Fund shall allocate to each class of shares 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 (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):

(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;

(vi) litigation or other legal expenses relating solely to such class
of shares;

(vii) Director's 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.

12. Except for any expenses that are allocated to a particular class as
described in paragraph 11 above, all expenses incurred by the Fund will be
allocated to each class of shares on the basis of the net asset value of each
such class in relation to the net asset value of the Fund.

-3-

<PAGE>

ALLOCATION OF INCOME AND GAINS

13. Income and realized and unrealized capital gains and losses of the
Fund will be allocated to each class of shares on the basis of the net asset
value of each such class in relation to the net asset value of the Fund.

CONVERSIONS

14. 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 in accordance with the terms
described in the Fund's relevant prospectus. Class B shares acquired through a
reinvestment of dividends or distributions will convert to Class A shares pro
rata with the Class B shares that were not acquired through the reinvestment of
dividends and distributions.

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
may suspend the automatic conversion feature by determining that any other
condition to conversion set forth in the Fund's prospectus, as amended from time
to time, is not satisfied.

The Board of Directors 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.

Class A, Class C and Institutional Class shares do not have a conversion
feature.

EXCHANGES

15. Exchanges are permitted between Class A Shares and Institutional
Class Shares of the Fund or of any other fund in the Delaware Group funds; Class
B shares of the Fund may only be exchanged for Class B shares of any other Fund
in the Delaware Group; Class C shares of the Fund may only be exchanged for
Class C shares of any other Fund in the Delaware Group. All exchanges are

-4-

<PAGE>

subject to the eligibility and minimum purchase requirements set forth in the
Fund's prospectuses. Exchanges cannot be made between open-end and closed-end
funds within the Delaware Group.

16. Each Class will vote separately with respect to the Rule 12b-1 Plan
related to that Class; provided, however, that Class B shares may vote on any
proposal to materially increase the fees to be paid by the Fund under the Fund's
Rule 12b-1 for the Class A shares.

17. On an ongoing basis, the Directors pursuant to their fiduciary
responsibilities under the 1940 Act and otherwise, will monitor the Fund for the
existence of any material conflicts between the interests of the four classes of
shares. 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.

18. As described more fully in the Fund's prospectuses, broker-dealers
that sell Fund shares will be compensated differently depending on which class
of shares the investor selects.

19. The Fund reserves the right to increase, decrease or waive the CDSC
imposed on any existing or future class of shares with 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 amended or adopted from time to time.
The Fund may in the future alter the terms of existing classes or create new
classes in compliance with applicable rules and regulations of the SEC and the
NASD.

20. All material amendments to this Plan must be approved by a majority
of the Directors of the Fund, including a majority of the Directors who are not
interested persons of the Fund.

Effective as of November 29, 1995

-5-

<PAGE>

POWER OF ATTORNEY

Each of the undersigned, a member of the Board of Directors of DELAWARE
GROUP VALUE FUND, INC., hereby constitutes and appoints Wayne A. Stork, W.
Thacher Longstreth and Walter P. Babich and any one of them acting singly, his
true and lawful attorneys-in-fact, in his name, place, and stead, to execute and
cause to be filed with the Securities and Exchange Commission and other federal
or state government agency or body, such registration statements, and any and
all amendments thereto as either of such designees may deem to be appropriate
under the Securities Act of 1933, as amended, the Investment Company Act of
1940, as amended, and all other applicable federal and state securities laws.

IN WITNESS WHEREOF, the undersigned have executed this instrument as of
this 20th day of April, 1995.

/s/Walter P. Babich /s/W. Thacher Longstreth
-------------------------- --------------------------------
Walter P. Babich W. Thacher Longstreth

/s/Anthony D. Knerr /s/Charles E. Peck
-------------------------- --------------------------------
Anthony D. Knerr Charles E. Peck

/s/Ann R. Leven /s/Wayne A. Stork
-------------------------- --------------------------------
Ann R. Leven Wayne A. Stork

<PAGE>
PHOTO OF
COLONIAL OBJECTS

December 15, 1994

Dear Shareholder:

Your Fund's 1994 fiscal year, which ended November 30, 1994, was difficult
given the Federal Reserve's February 4th unleashing of the first of what were
to be six unprecedented increases in short-term interest rates before the
fiscal year was over. The markets in small and mid-cap stocks were tough
arenas indeed.

The table below presents Delaware Group Value Fund's total return
(capital change plus income) for the fiscal 12 months, compared with the
Russell 2000 Index, an unmanaged index comprised of stocks similar to those
owned in Value Fund, which seeks long-term growth by focusing on small and
medium-size companies that are currently undervalued.

-----------------------------------------------------------------------------

TOTAL RETURN
FISCAL YEAR ENDED
NOVEMBER 30, 1994

Delaware Group Value Fund -2.78%
Russell 2000 Index -1.11%

Value Fund's return is based on performance of the portfolio at net asset
value. If the maximum sales charge of 5.75% was included, the return would
have been -8.35%. Please see page 5 for additional information and
performance for all classes of Value Fund.
-----------------------------------------------------------------------------

The Fed's actions have been in response to a U.S. economy that is
growing at a pace which the central bank's officials considered faster than
that consistent with a stable-to-low rate of inflation. The markets reacted
swiftly and, on occasion, quite sharply, creating greater volatility in
prices and unpredictability in their direction over the short-term. In short,
it was a challenging period for investors in small and mid-cap stocks. While
the current outlook remains uncertain, we do not envision any significant
decline from current price levels.

Despite the poor environment for our "stock in trade," there were
certain areas within the small company sector that fared better than others.
Our portfolio management strived to identify these areas, as is discussed in
more detail inside this annual report. We also review how the management has
positioned the Fund for the 1995 fiscal year, as well as our expectations for
the period ahead.

We appreciate your investing in Value Fund, which, we are confident,
will continue to be a strategic investment through which you can participate
in the long-term potential of small and mid-cap stocks.

Sincerely,

/s/ WAYNE A. STORK /s/ BRIAN F. WRUBLE
-------------------------------- -----------------------------------
Wayne A. Stork Brian F. Wruble
Chairman President & CEO
Delaware Group Value Fund Delaware Group Value Fund

<PAGE>
PHOTO OF
COLONIAL OBJECTS

MAKING THE BEST OF A TOUGH YEAR FOR STOCKS

The 12-month period ended November 30, 1994, was an uneasy period for the
stock market in general and for small stocks in particular. The unmanaged
Standard & Poor's 500 Index, which measures the stock returns of corporations
with large market capitalizations, was up only +1.04%. Small company and
mid-cap stocks fared worse, with the Russell 2000 Index down -1.11% and the
Standard & Poor's 400 MidCap Index dropping -0.03%.

PHOTO OF
EDWARD A. TRUMPBOUR
SENIOR PORTFOLIO MANAGER

Interest rate increases were the predominant factor behind the
disappointing returns for both the large stock and small and mid-cap stock
categories. The Fed's actions created uncertainty in the markets which led to
greater price volatility. The effect of interest rate changes can affect some
sectors more than others. For example, the impact of interest rate changes on
credit sensitive stocks (banks and financial services firms) is typically
more dramatic than on stocks in the consumer (restaurants, retailers) or
technology sectors.

SEARCHING FOR VALUE AMONG SMALL STOCKS
------------------------------------------------------------------------------
The majority of small company mutual funds focus on GROWTH stocks
(those with lower-than-average dividend yields and above-average potential
for earnings growth). These stocks are commonly found in the technology,
health care and consumer products industries. Indeed, small company funds are
generally recognized to be capital growth funds.
Delaware Group Value Fund has a capital growth objective but
additionally follows investment policies which prescribe VALUE stocks (those
with below-average price-to-book and price-to-earnings ratios.) We search for
value in three distinct areas:

* ASSET PLAYS - Value Fund looks for companies whose parts or
subsidiaries, may be worth more than the company's current market
value. Once this is realized, prices could rise to reflect a more
accurate value.

* DISCOUNTED GROWTH OPPORTUNITIES - Temporary events may cause earnings
to drop for a limited period of time, offering excellent opportunities
for investors looking for undervalued stocks. Once these events are
corrected or have passed, earnings may continue to grow and value may
rise. In addition, unrecognized stocks may rise in value once
discovered by the investing public.

* SPECIAL SITUATIONS - Buying in anticipation of a spin-off,
recapitalization or turnaround situation can result in upward price
movement if the anticipated event is initiated.

If your Fund's management can uncover such stocks before they are
"discovered" by other investors, and are thus underpriced relative to their
value, this, we believe, could enhance our opportunities for long-term
reward.
<PAGE>
PHOTO OF
COLONIAL OBJECTS

A PROFILE OF THE VALUE FUND PORTFOLIO

SECTORS WHERE GOOD VALUE EXISTED DESPITE RISING RATES

In spite of market turmoil, certain sectors of the stock market
performed well. We had success with companies that provide "basic materials,"
such as Chesapeake Corporation, a paper company, and National Gypsum. Among
commercial services firms, Reynolds & Reynolds, a business form manufacturer
serving the auto industry, was a strong performer, as was Devon Group, a
printing service. And although rising interest rates usually hit the
industrial sector hard, three stocks from the group--IDEX, a manufacturer of
pumps and valves, and two suppliers to the automotive industry, Cherry
Corporation and Durakon--were good investments over the past 12 months given
that the automotive industry itself was strong.

SECTORS THAT REACTED MORE NEGATIVELY
Not performing as well were consumer durables and credit-sensitive
stocks, both of which are highly susceptible to rising interest rates.
"Consumer durables" is a term for manufactured goods that are considered
major consumer purchases, and as a result often require financing. When rates
increase, housing sales tend to decline; this, in turn, reduces the purchases
of such consumer durables as appliances.
Credit-sensitive stocks have profit margins that are often directly
tied to interest rate moves. Banks, for example, make money from the
difference between what they have to pay to borrow money and the rate at
which they lend it. When rates increase, lending activity decreases, and
banks have to pay higher interest on their customers' deposits. Together,
these factors can reduce profitability.
The retail sector was another poor performer. Although Value Fund
rarely has much exposure to this traditional "growth" sector, our experience
over the past year was on a company-by-company basis. We bought
companies--such as Fingerhut and Spiegel--which we believed had solid market
positions in growing businesses backed by good management. However, these
holdings experienced slowed growth not only because of poor sector
performance, but also because of company specific setbacks.

INTERNATIONAL STOCKS
Over the course of the fiscal year, our percentage investment in
international holdings remained relatively steady. At times like these when
it is somewhat difficult to find good values in small American companies, the
ability to invest overseas offers the Fund additional areas of potential.
Approximately 13% of the Fund's net assets are currently invested outside of
the U.S., where less readily available market research can often lead to
overlooked investment opportunities. In such situations, we believe the
upside potential of a value strategy like ours is increased.

CASH
Net cash flow into Value Fund over the past 12 months was
approximately $23 million. Given a lack of buying opportunities that fit our
target profile, we allowed our cash position to build; it stood at 35% of net
assets at year-end. These holdings in short-term fixed income securities helped
the Fund during the worst months for the market. Going forward, as the market
provides us opportunities, we plan to reduce this cash position.

<PAGE>
PHOTO OF
COLONIAL OBJECTS
LOOKING ONE YEAR AHEAD

We believe there are reasons for optimism on the horizon. One is the recent
passage of GATT, the General Agreement on Tariffs and Trade. The Agreement
will make U.S. goods easier to export overseas because of a reduction in
isolationist tariffs. Combined with a relatively weak dollar, which lowers
the cost of American products overseas, the industrial sector of the small
company stock market, in particular, should benefit.

-----------------------------------------------------------------

VALUE FUND
TOP FIVE EQUITY SECTORS
-------------------------------------------------------
Manufacturing & Industrial Services 18.89%
Foreign Securities 10.55%
Credit Sensitive 8.89%
Energy/Utilities 6.72%
Consumer Group 6.00%

As a percentage of net assets on November 30, 1994.

------------------------------------------------------------------

Energy is another sector of the market that we think should do well
for investors. We have begun increasing our holdings of oil stocks recently,
due to our belief that they are coming back into favor after a 20-year bear
market. We are focusing on selected companies in the exploration business,
specifically those that have the technology to explore sites that larger
companies could not take advantage of.
If the Fed's interest rate increases succeed in causing an economic
slowdown, and we believe they will, certain stocks may stand to benefit. We
believe that the credit-sensitive sector, where we have 8.89% of the Fund's
holdings, would be one of them. We also believe that slower economic growth
could cause an increase in company takeovers and employee buyout bids, as a
slower economy could make these companies appear inexpensive to potential
buyers. This is one type of "special situation" we look for, as there can be
profits to stockholders of the absorbed company.
As we look toward 1995, and the control of Congress moving to the
Republican side for the first time in four decades, we believe there could be
several important changes that will enhance the markets. The primary one, of
course, is the possibility of a capital gains tax cut. Another is a broadened
Individual Retirement Account. And finally, as we've mentioned above, we are
operating in an investment climate offering us attractive buying
opportunities, which we believe will benefit the Fund in the coming year.

-------------------------------------------------------------------
IF THE FED'S INTEREST RATE INCREASES SUCCEED IN CAUSING AN ECONOMIC
SLOWDOWN, AND WE BELIEVE THEY WILL, CERTAIN STOCKS MAY STAND TO
BENEFIT. WE BELIEVE THAT THE CREDIT SENSITIVE SECTOR, WHERE WE
HAVE 8.89% OF THE FUND'S HOLDINGS, WOULD BE ONE OF THEM.

<PAGE>
PHOTO OF
COLONIAL OBJECTS
VALUE FUND'S LONG-TERM PERFORMANCE

Financial planning specialists recommend that stock market investors have a
long time horizon, at least five years. This is because stock prices can move
dramatically over short time periods and will experience some years with low
or negative returns.
The chart below illustrates the potential benefit of holding a stock
investment for the long term. A $10,000 investment in Value Fund at its
inception on June 24, 1987 would have grown to $23,978 by November 30, 1994,
for an annual average return of 12.48%.
As the chart illustrates, Value Fund's performance surpassed that of
the Russell 2000 Index by a healthy margin, and kept investors' money ahead
of the rate of inflation. We believe that the Fund's strategy of focusing on
"underpriced" value stocks will continue to contribute to competitive
long-term results.

----------------------------------------------------------------------

$10,000 invested June 24, 1987
through November 20, 1994
---------------------------------------
Russell
Value Cost of 2000 Stock
Fund Living Index Index
--------- ------------ -----------
Jun-87 9426 10000 10000
Dec-87 8630 10167 7395
Dec-88 10909 10617 9245
Dec-89 14386 11110 10748
Dec-90 12495 11789 8655
Dec-91 18863 12150 12640
Dec-92 21652 12502 14967
Dec-93 25727 12846 17793
Nov-94 23978 13172 17011

----------------------------------------------------------------------
Chart assumes a $10,000 investment in Value Fund Class A on inception 6/24/87
through 11/30/94. Both the Fund and the Indexes reflect the reinvestment of
all distributions. No adjustments were made for the payment of taxes. The
Russell 2000 is an unmanaged index of small and medium-size common stocks.
The Cost of Living Index is a measure of inflation. Index data were provided
by Lipper Analytical Services. Performance of other classes of Value Fund is
detailed to the right.

VALUE FUND'S PERFORMANCE

CLASS A
Average Annual Total Returns(1)
Lifetime 12.48%
Five Years 10.07%
One Year -8.35%
Including Sales Charge

CLASS B
Aggregate Total Returns(2)
Lifetime -4.83%
Excluding Sales Charge

Lifetime -8.64%
Including Sales Charge

Through November 30, 1994

RETURN AND SHARE VALUE WILL FLUCTUATE SO THAT SHARES, WHEN REDEEMED, MAY BE
WORTH MORE OR LESS THAN THE ORIGINAL INVESTMENT. PAST PERFORMANCE IS NOT A
GUARANTEE OF FUTURE RESULTS.

(1) CLASS A returns reflect the impact of the 5.75% maximum sales charge and
the 12b-1 fee and reflect the reinvestment of all distributions.

(2) CLASS B was initially offered on 9/6/94. Performance for this short time
period may not be representative of longer term results. Class B shares do
not carry a front-end sales charge, but are subject to a 1% annual
distribution and service fee. They are subject to a deferred sales charge
of up to 4% if redeemed before the end of the sixth year. Lifetime
performance excluding sales charge assumes the investment was not redeemed.

The average annual total returns for Value Fund's Institutional Class, which
is available without sales or asset-based distribution charges only to
certain eligible institutional accounts, were 13.47%, 11.52% and -2.51%,
respectively for the lifetime, five- and one-year fiscal periods ended
11/30/94. Returns for the lifetime, five-, and one-year periods ended
12/31/94 were 13.28%, 10.86%, and -6.70%, respectively. The Institutional
Class was initially made available 11/9/92. Performance for the Institutional
Class for periods prior to this date is based on Class A performance,
adjusted to eliminate the sales charge, but not the asset-based distribution
charge.

<PAGE>

PERFORMANCE THROUGH DECEMBER 31, 1994
CLASS A
Average Annual Total Returns(1)
Lifetime 12.30%
Five Years 9.42%
One Year -12.31%
Including Sales Charge

CLASS B
Aggregate Total Returns(2)
Lifetime -5.06%
Excluding Sales Charge

Lifetime -8.78%
Including Sales Charge

<PAGE>

FINANCIAL STATEMENTS

DELAWARE GROUP VALUE FUND, INC.
STATEMENT OF NET ASSETS
November 30, 1994

NUMBER MARKET
OF SHARES VALUE

DOMESTIC COMMON STOCK-54.81%
COMMODITY/BASIC MATERIALS-5.18%
*AK Steel Holding.............................. 30,000 $ 813,750
Chesapeake.................................... 54,000 1,768,500
*Durakon Industries............................ 57,500 1,006,250
*Geneva Steel Class A.......................... 150,000 2,006,250
*Grupo Simec ADR............................... 70,000 1,610,000
Rochester & Pittsburgh Coal .................. 1,100 38,638
*Steel of West Virginia........................ 80,000 760,000
Willamette Industries......................... 40,000 1,695,000
------------
9,698,388
------------
COMMUNICATIONS-2.37%
*ALC Communications............................ 50,000 1,700,000
Century Telephone Enterprises ................ 8,100 240,975
Royal PTT Nederland NV - ADR ................. 53,000 1,654,411
*Valassis Communications....................... 60,000 840,000
------------
4,435,386
------------
CONSUMER GROUP-6.00%
American Maize Products Class A .............. 5,000 117,500
*Baldwin Piano & Organ......................... 30,000 390,000
Barefoot...................................... 9,000 115,875
*Canandaigua Wine Class A...................... 22,000 734,250
*Custom Chrome................................. 70,700 1,277,019
Fingerhut..................................... 44,000 726,000
*Hahn Automotive Warehouse .................... 20,000 310,000
*Hi-Lo Automotive.............................. 40,000 410,000
Huffy......................................... 43,000 612,750
*Instrument Systems............................ 150,000 1,256,250
*Mohawk Industries............................. 52,500 892,500
*O'Sullivan Industries Holding ................ 25,000 287,500
Panamerican Beverages Class A ................ 25,000 875,000
*Paragon Trade Brands.......................... 4,700 88,125
*Rocky Shoes & Boots........................... 35,200 321,200
*Ryan's Family Steak Houses ................... 30,000 211,875
*Scholastic.................................... 19,400 919,075
*Scott's....................................... 43,500 647,063
*Syratech...................................... 60,000 1,050,000
------------
11,241,982
------------
CREDIT SENSITIVE-8.89%
*American Pacific.............................. 10,000 90,000
*Americredit................................... 240,000 1,440,000
*Banco Wiese ADR............................... 19,500 385,125
*California Federal Bank Class A .............. 80,000 870,000

<PAGE>

NUMBER MARKET
OF SHARES VALUE
COMMON STOCK (CONTINUED)
CREDIT SENSITIVE (CONTINUED)
Camden Property Trust......................... 57,800 $ 1,264,375
CB Bankshares................................. 15,000 461,250
Commercial Net Lease Realty .................. 50,000 618,750
Factory Stores of America. ................... 50,000 1,031,250
Fidelity National Financial .................. 7,500 81,563
First American (Tennessee) ................... 27,000 737,438
First Bancorp, Ohio........................... 48,000 1,158,000
First Security................................ 20,900 512,050
Fourth Financial.............................. 13,000 391,625
Integra Financial............................. 10,000 400,000
Kranzco Realty Trust.......................... 22,000 401,500
MGIC Investment............................... 16,000 478,000
Money Store................................... 57,600 1,008,000
Morgan Keegan................................. 30,000 386,250
ONBANCorp..................................... 36,300 925,650
ROC Communities............................... 80,000 1,550,000
SouthTrust.................................... 16,800 306,600
Union Planters................................ 18,000 371,250
Washington Mutual Savings Bank-Seattle ....... 54,000 928,125
West One Bancorp.............................. 32,000 852,000
------------
16,648,801
------------
ENERGY/UTILITIES-6.72%
*American Oilfield Divers...................... 175,000 1,181,250
Apache........................................ 30,000 840,000
Cabot Oil & Gas Class A....................... 64,700 1,083,725
*Chesapeake Energy............................. 33,600 978,600
Cross Timbers Oil............................. 35,700 522,113
Devon Energy.................................. 44,700 860,475
*Global Marine................................. 300,000 1,200,000
*Noble Drilling................................ 90,375 564,844
Nowsco Well Service........................... 60,000 787,500
Production Operators.......................... 20,000 432,500
Quaker State.................................. 20,000 275,000
*Tom Brown..................................... 94,400 938,100
USX-Delhi Group............................... 100,000 1,187,500
Valero Energy................................. 24,000 456,000
Western Gas Resources......................... 62,500 1,273,438
------------
12,581,045
------------
HEALTH CARE-0.10%
*FHP International............................. 6,600 178,200
------------
178,200
------------
<PAGE>

NUMBER MARKET
OF SHARES VALUE
COMMON STOCK (CONTINUED)
INSURANCE-1.66%
Allmerica Property & Casualty ........... 54,600 $819,000
Bankers Life Holdings ................... 35,200 598,400
CCP Insurance ........................... 34,700 511,825
*Home State Holdings ..................... 26,300 335,325
PartnerRe Holdings ...................... 45,000 849,375
----------
3,113,925
----------
MANUFACTURING AND
INDUSTRIAL SERVICES-18.89%
ARCTCO .................................. 64,275 1,277,466
Boise Cascade ........................... 40,000 970,000
*Bush Boake Allen ........................ 49,500 1,126,125
*CSS Industries .......................... 34,000 552,500
Cascade ................................. 20,000 432,500
*Central Sprinkler ....................... 15,700 157,000
*Champion Enterprises .................... 50,000 1,418,750
*Cherry Class A .......................... 48,500 691,125
*Cherry Class B .......................... 48,500 703,250
Continental Homes Holdings .............. 87,600 1,193,550
*Devon Group ............................. 52,000 1,313,000
*Digicon ................................. 330,000 474,375
*Elcor ................................... 25,000 375,000
Excel Industries ........................ 15,000 213,750
Ferro ................................... 25,000 606,250
HON Industries .......................... 5,000 137,500
*Hornbeck Offshore Services .............. 42,000 538,125
*IDEX .................................... 36,600 1,505,175
*INDRESCO ................................ 120,000 1,515,000
*Johnstown America Industries ............ 34,600 631,450
Joslyn .................................. 11,500 301,875
Kaufman & Broad Home .................... 60,000 765,000
*Lindsay Manufacturing ................... 12,100 358,463
*Lone Star Technologies .................. 50,000 378,125
Longview Fibre .......................... 50,000 812,500
Lubrizol ................................ 28,000 882,000
*Magnetek ................................ 70,000 945,000
Manitowoc ............................... 32,500 775,938
Methode Electronics Class A ............. 87,000 1,228,875
*Moog .................................... 75,000 637,500
*National Gypsum ......................... 62,000 2,666,000
*Patrick Industries ...................... 79,000 681,375
*Patterson Dental ........................ 24,300 437,400
Regal Beloit ............................ 49,200 621,150

<PAGE>

NUMBER MARKET
OF SHARES VALUE
COMMON STOCK (CONTINUED)
MANUFACTURING AND
INDUSTRIAL SERVICES (CONTINUED)
Reynolds & Reynolds ....................... 90,000 $2,070,000
Roper Industries .......................... 16,000 404,000
Ryland Group .............................. 50,000 693,750
Schult Homes .............................. 25,500 277,313
Smith (A.O.) .............................. 38,000 855,000
Spartan Motors ............................ 16,500 233,063
*Sybron International ...................... 34,600 1,128,825
Thiokol ................................... 50,000 1,331,250
TriMas .................................... 30,000 600,000
Varlen .................................... 20,000 477,500
-----------
35,393,793
-----------
RETAILING/DISTRIBUTION-2.38%
*Arden Industrial Products ................. 25,000 181,250
*Burlington Coat Factory ................... 29,700 341,550
Horizon Outlet Centers .................... 46,000 1,023,500
Mercantile Stores ......................... 5,000 202,500
*Musicland Stores .......................... 80,000 870,000
Spiegel Class A ........................... 30,000 401,250
*Urban Outfitters .......................... 20,600 612,850
Venture Stores ............................ 10,000 126,250
*Willcox & Gibbs ........................... 110,000 701,250
-----------
4,460,400
-----------
TECHNOLOGY-0.55%
*DOVatron International .................... 10,000 256,250
*IEC Electronics ........................... 70,000 783,125
-----------
1,039,375
-----------
TRANSPORTATION-2.07%
AirTran ................................... 77,000 606,375
*Consolidated Freightways .................. 45,000 871,875
Intertrans ................................ 40,800 535,500
*Mesa Airlines ............................. 30,000 275,625
*Offshore Logistics ........................ 30,800 415,800
*SEACOR Holdings ........................... 55,000 1,175,625
-----------
3,880,800
-----------
TOTAL COMMON STOCK (COST $ 98,384,767) ..... 102,672,095
-----------

FOREIGN SECURITIES-10.55%
AGIV AG ................................... 3,000 959,052
Bayer Vereinsban .......................... 2,868 838,319
Bobst Ag .................................. 1,000 1,166,729
Boskalis Westminster ...................... 41,052 830,937

<PAGE>

NUMBER MARKET
OF SHARES VALUE
STATEMENT OF NET ASSETS (continued)
FOREIGN SECURITIES (CONTINUED)
Deutsche Pfandbrief & Hypobk .............. 1,700 $ 796,249
Draegerwerk Ag Vorz Akt.................... 4,000 782,016
Gold Peak.................................. 1,170,000 476,557
Grupo Sidek Class B........................ 330,000 1,417,207
*Grupo Sidek S.A. Series L ................. 8,205 35,810
*Grupo Situr SA............................. 400,000 1,287,206
Hong Kong Aircraft......................... 206,000 700,553
Johnson Electric........................... 218,500 559,416
JCG Holdings LTD........................... 1,356,000 846,010
Kunert Preferred........................... 1,700 238,171
*Mid Ocean LTD.............................. 52,400 1,205,200
*MO OCH Domsjoe AB-B Free................... 15,000 704,571
National Mutual Asia....................... 1,056,000 621,289
Pechiney International SA.................. 35,000 1,062,516
Schmalbach Lubeca AGR...................... 3,400 778,386
Sig Schweiz Industrie...................... 1,000 1,866,767
Spar Handels Ag-Non Vtg pfd ............... 5,500 1,085,780
*Tampella AB................................ 175,000 517,783
Top Form................................... 2,774,000 204,456
Varitronix................................. 541,000 776,495
TOTAL FOREIGN SECURITIES ------------
(COST $ 17,715,974)........................ 19,757,475
------------

PRINCIPAL
AMOUNT
SHORT-TERM INVESTMENTS-17.45%
Federal Home Loan Bank
Discount Notes 1/30/95..................... $10,000,000 9,904,667
Federal National Mortgage Association
Discount Notes 1/24/95..................... 13,000,000 12,890,800
Federal National Mortgage Association
Discount Notes 1/30/95..................... 10,000,000 9,902,229
------------
TOTAL OTHER SHORT TERM INVESTMENTS
(COST $ 32,700,967)........................ 32,697,696
------------

REPURCHASE AGREEMENTS-17.60%
With Banker's Trust 5.68% 12/1/94
(dated 11/30/94, collateralized by
$1,540,000 U.S. Treasury Notes 7.75%
due 3/31/96, market value $1,570,686 and
$10,062,904 U.S. Treasury Notes 4.25% due
5/15/96, market value $9,665,530) ......... $ 11,010,000 11,010,000

<PAGE>

PRINCIPAL MARKET
AMOUNT VALUE
REPURCHASE AGREEMENTS (CONTINUED)
With PaineWebber 5.70% 12/1/94
(dated 11/30/94, collateralized by
$8,386,000 U.S. Treasury Bills
due 4/13/95, market value $8,207,669
and $2,755,000 U.S. Treasury Notes 9.25%
due 1/15/96, market value $2,913,977) ........$10,902,000 $ 10,902,000
With Prudential Securities 5.68% 12/1/94
(dated 11/30/94, collateralized by
$3,675,000 U.S. Treasury Notes 3.875%
due 8/31/95, market value $3,636,939
and $8,386,000 U.S. Treasury Notes
4.75% due 8/13/98, market value
$7,672,204)................................... 11,069,000 11,069,000
------------
TOTAL REPURCHASE AGREEMENTS
(COST $32,981,000)....................................... 32,981,000
------------

TOTAL MARKET VALUE OF
SECURITIES-100.41% (COST $ 181,782,708) ................. $188,108,266
LIABILITIES NET OF RECEIVABLES
AND OTHER ASSETS-0.41%................................... (769,933)
------------
NET ASSETS APPLICABLE TO 9,693,964
SHARES ($.01 PAR VALUE) OUTSTANDING-100.00% ............. $187,338,333
============

NET ASSET VALUE-VALUE FUND
A CLASS ($179,498,216 / 9,289,521 SHARES) ............... $19.32
======
NET ASSET VALUE-VALUE FUND
INSTITUTIONAL CLASS
($6,385,226 / 329,064 SHARES) .......................... $19.40
======
NET ASSET VALUE-VALUE FUND
B CLASS ($1,454,891 / 75,379 SHARES) .................... $19.30
======

------------
*Non-income producing security for the year ended November 30, 1994.

See accompanying notes

<PAGE>

DELAWARE GROUP VALUE FUND, INC.
STATEMENT OF OPERATIONS
Year Ended November 30, 1994

INVESTMENT INCOME:
Interest...................................... $2,208,906
Dividends (net of foreign taxes) ............. 1,801,180 $ 4,010,086
----------

EXPENSES:
Management fees ($1,341,214)
and directors' fees ($12,752) ............... 1,353,966
Distribution expenses......................... 523,167
Dividend disbursing and transfer agent
fees and expenses............................ 443,348
Registration fees............................. 69,191
Salaries...................................... 49,109
Custodian fees................................ 39,796
Reports and statements to shareholders ....... 34,328
Taxes, other than taxes on income ............ 20,679
Auditing...................................... 13,096
Other......................................... 62,678 2,609,358
----------- -----------
NET INVESTMENT INCOME......................... 1,400,728
-----------

NET REALIZED GAIN AND UNREALIZED
LOSS ON INVESTMENTS AND
FOREIGN CURRENCIES:
Net realized gain (loss) on:
Investment transactions...................... 2,462,455
Foreign currency............................. (22,865)
-----------
Net realized gain........................................... 2,439,590
Net unrealized depreciation of
investments and foreign currency
during the period........................................... (9,879,689)
-----------
NET REALIZED AND UNREALIZED LOSS
ON INVESTMENTS.............................................. (7,440,099)
-----------
NET DECREASE IN NET ASSETS RESULTING
FROM OPERATIONS............................................. $(6,039,371)
===========
COMPUTATION OF NET ASSET VALUE AND
OFFERING PRICE-VALUE FUND A CLASS:
Net asset value per share (A) .............................. $19.32
Sales charges (5.75% of offering price, or 6.10%
of amount invested per share)(B)............................ 1.18
------
Offering price............................................... $20.50
======
------------
(A) Net asset value per share, as illustrated, is the estimated amount which
would be paid upon the redemption or repurchase of shares.
(B) See Purchasing Shares in the current Prospectus for purchases of $100,000
or more.

See accompanying notes
<PAGE>

DELAWARE GROUP VALUE FUND, INC.
STATEMENT OF CHANGES IN NET ASSETS

YEAR YEAR
ENDED ENDED
11/30/94 11/30/93

OPERATIONS:
Net investment income.......................... $ 1,400,728 $ 234,973
Net realized gain from security
transactions and foreign currencies .......... 2,439,590 1,395,362
Net unrealized appreciation (depreciation)
of investments during the period ............. (9,879,689) 11,664,975
------------ ------------
Net increase (decrease) in net assets
resulting from operations..................... (6,039,371) 13,295,310
------------ ------------

DISTRIBUTIONS TO
SHAREHOLDERS FROM:
Net investment income:
Value Fund A Class............................ (268,712) (95,293)
Value Fund Institutional Class ............... (21,832) (3,617)
Value Fund B Class............................ -- --
Net realized gain from security transactions:
Value Fund A Class............................ (1,305,068) (1,953,489)
Value Fund Institutional Class ............... (46,393) (74,151)
Value Fund B Class............................ -- --
------------ ------------
(1,642,005) (2,126,550)
------------ ------------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold:
Value Fund A Class............................ 126,050,942 136,360,673
Value Fund Institutional Class ............... 3,152,293 5,455,946
Value Fund B Class............................ 1,551,271 --
Net asset value of shares issued upon
reinvestment of dividends from net investment
income and net realized gain from
security transactions:
Value Fund A Class............................ 1,449,342 1,887,864
Value Fund Institutional Class ............... 68,225 77,768
Value Fund B Class............................ -- --
------------ ------------
132,272,073 143,782,251
------------ ------------
Cost of shares repurchased:
Value Fund A Class............................ (92,020,403) (36,427,690)
Value Fund Institutional Class ............... (2,051,443) (2,013,703)
Value Fund B Class............................ (40,173) --
------------ ------------
(94,112,019) (38,441,393)
------------ ------------
Increase in net assets derived
from capital share transactions .............. 38,160,054 105,340,858
------------ ------------
NET INCREASE IN NET ASSETS .................... 30,478,678 116,509,618
NET ASSETS:
Beginning of period............................ 156,859,655 40,350,037
------------ ------------
End of period (including undistributed net
investment income of $1,327,257 and
$217,073, respectively)....................... $187,338,333 $156,859,655
============ ============

See accompanying notes
<PAGE>

DELAWARE GROUP VALUE FUND, INC.
NOTES TO FINANCIAL STATEMENTS
November 30, 1994

1. SIGNIFICANT ACCOUNTING POLICIES
Delaware Group Value Fund, Inc. (the "Fund") is a diversified open-end
management investment company organized under the laws of Maryland and is
registered under the Investment Company Act of 1940, as amended. The Fund
currently offers three classes of shares, Value Fund A Class (formerly known
as Value Fund class), Value Fund Institutional Class (formerly known as Value
Fund (Institutional) class), and Value Fund B Class.

Portfolio securities listed or traded on a national securities exchange,
except for bonds, are valued at the last sale price on the exchange where
they are primarily traded. Securities listed on a foreign exchange are valued
at the last quoted sale price before the time when the Fund is valued.
Securities not traded on a particular day, over-the-counter securities and
government and agency securities are valued at mean value between bid and
asked prices. Money market instruments having a maturity of less than 60 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. The values of all assets and liabilities initially expressed in
foreign currencies are translated into U.S. dollars at the exchange rate of
such currencies against the U.S. dollar as provided by the pricing service at
approximately 3:00 PM New York time. Forward foreign currency contracts are
valued at the mean between the bid and asked prices of the contracts.
Interpolated values are derived when the settlement date of the contract is
on an interim date for which quotations are not available.

On November 30, 1994, 17.60% of the Fund's net assets were invested in
overnight repurchase agreements. These agreements are fully collateralized by
U.S. government securities and such collateral is held by the Fund's
Custodian or in the Federal Reserve/Treasury book-entry system. The Fund
monitors its repurchase agreements to ensure that the market value of the
collateral underlying the agreements is at least 100% of the repurchase price
including the portion representing the Fund's yield under such agreements.

Security transactions are accounted for on the date the securities are
purchased or sold (trade date). Gains and losses are based upon the specific
identification method for both financial statement and federal tax purposes.
Dividend income and distributions to shareholders are recorded on the
ex-dividend date. Foreign dividends are also recorded on the ex-dividend date
or as soon after the ex-dividend date that the Fund is aware of such
dividends, net of all non-rebatable tax withholdings. Interest income and
expenses are recorded on the accrual basis.

No provision for federal income taxes was made since it is the intention of
the Fund to comply with the provisions of the Internal Revenue Code available
to regulated investment companies and to make requisite distributions to
shareholders.
<PAGE>

On November 9, 1992, the Fund offered a new class of shares, the Value Fund
Institutional Class, which is available only to certain institutions at net
asset value and on September 6, 1994 the Fund began offering the Value Fund B
Class. Each share in each class will bear, pro rata, all of the common
expenses of the Fund except that the Value Fund Institutional Class will not
incur any distribution fees under the 12b-1 Plan. 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. Due to the specific
distribution expenses and other costs that would be allocable to each class,
it is expected that the net asset value and dividends paid to each class of
the Fund will vary.

The Fund is permitted to borrow money as a temporary measure for
extraordinary or emergency purposes. The Fund has a line of credit
arrangement with its custodian bank, Chemical Bank, for an amount not to
exceed $2.5 million. As of and for the year ended November 30, 1994, there
were no borrowings under this line of credit.

2. INVESTMENT MANAGEMENT FEE AND OTHER TRANSACTIONS WITH AFFILIATES
In accordance with the terms of the Investment Management Agreement, the
compensation paid to Delaware Management Company, Inc., the investment
manager of the Fund, is equal to (on an annual basis) 0.75% of the average
daily net assets of the Fund, less all amounts paid to the unaffiliated
directors by the Fund. On December 12, 1994, Delaware Management Holdings,
Inc., which indirectly owns all of the outstanding stock of Delaware
Management Company, Inc., entered into an agreement of merger with Lincoln
National Corporation. This merger will result in Delaware Management Holdings,
Inc. becoming a wholly-owned subsidiary of Lincoln National Corporation. The
transaction is subject to the receipt of all regulatory and shareholder
approvals. Pursuant to the Distribution Agreement between the Fund and
Delaware Distributors, L.P., an affiliate of Delaware Management Company, Inc.,
the Distributor will be paid monthly a fee which is computed on the net
assets of Fund as of the close of business each day at the annual rate of
0.30% of the Fund's average daily net assets attributable to the Value Fund A
Class and 1.00% of the Fund's average daily net assets attributable to the
Value Fund B Class.

Certain officers, directors and shareholders of Delaware Management Company,
Inc. are officers and/or directors of Delaware Group Value Fund. Directors,
officers and employees of Delaware Management Company, Inc., who are also
officers, directors and employees of the Fund, do not receive any
compensation from the Fund. Salaries of officers and employees who are
exclusively employed by the Delaware Group of Funds are apportioned on the
basis of net assets of the respective Funds. For the year ended November 30,
1994, expenses related to such salaries for the Fund amounted to $49,109.
During the year ended November 30, 1994, Delaware Service Company, Inc., an
affiliate of Delaware Management Company, Inc., received $443,348 for
providing dividend disbursing and transfer agent services to the Fund. In
addition, Delaware Distributors, L.P. received $227,170 from commissions
earned on sales of Value Fund A Class capital stock.

<PAGE>
NOTES TO FINANCIAL STATEMENTS (CONTINUED)

On November 30, 1994, the Fund had an investment management fee payable to
Delaware Management Company, Inc. of $37,705. Also, the Fund had dividend
disbursing and transfer agent fees and expenses payable to Delaware Service
Company, Inc. of $6,657. In addition, the Fund owes Delaware Service Company,
Inc. and Delaware Distributors, L.P., $404, and $9,079, respectively, for
other expenses related to operations.

3. INVESTMENTS
Investment securities based on cost for federal income tax purposes at
November 30, 1994 are as follows:

Cost of investments .................... $181,788,310
Aggregate unrealized appreciation ...... 17,623,891
Aggregate unrealized depreciation ...... (11,303,935)
------------
Market value of investments ............ $188,108,266
============

Net realized gain based on cost of specific certificate for federal income
tax purposes was $ 2,451,228 for the year ended November 30, 1994.

During the year ended November 30, 1994, the Fund had purchases of
$33,252,727 and sales of $17,052,190 of investment securities, other than
U.S. government securities and short-term debt securities having maturities
of one year or less.

On November 30, 1994, the Fund had a receivable for securities sold of
$263,943.

<PAGE>

4. CAPITAL STOCK
Transactions in capital stock shares were as follows:

YEAR YEAR
ENDED ENDED
11/30/94 11/30/93
Shares sold:
Value Fund A Class....................... 6,203,942 7,132,906
Value Fund Institutional Class .......... 155,126 284,507
Value Fund B Class....................... 77,412 --
Shares issued upon reinvestment
of dividends from net investment
income and distributions of realized
gain from security transactions:
Value Fund A Class....................... 70,565 107,103
Value Fund Institutional Class .......... 3,317 4,411
Value Fund B Class....................... -- --
------------ ------------
6,510,362 7,528,927
------------ ------------
Shares repurchased:
Value Fund A Class....................... (4,527,081) (1,883,913)
Value Fund Institutional Class .......... (101,287) (104,693)
Value Fund B Class....................... (2,033) --
------------ ------------
(4,630,401) (1,988,606)
------------ ------------
Net increase.............................. 1,879,961 5,540,321
============ ============
5. COMPONENTS OF NET ASSETS
Common stock, $.01 par value, 500,000,000 shares
authorized to the Fund with 150,000,000 shares
allocated to Value Fund A Class, 50,000,000 to
Value Fund Institutional Class and 150,000,000 to
Value Fund B Class...................................... $177,239,967
Accumulated undistributed income:
Net investment income................................... 1,327,257
Net realized gain on investments
and foreign currencies.................................. 2,444,660
Net unrealized appreciation of investments
and foreign currencies.................................. 6,326,449
------------
Total net assets........................................ $187,338,333
============

The Fund declared distributions from net realized gain from security
transactions in the amount of $0.25 per share and $0.16, $0.215 and $0.15 per
share for Value Fund A Class, Value Fund Institutional Class and Value Fund B
Class, respectively, from net investment income, payable on January 5, 1995
to shareholders of record December 27, 1994. The ex-dividend date was
December 28, 1994.
<PAGE>

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

6. FINANCIAL HIGHLIGHTS
Selected data for each share of the Fund outstanding throughout each period
were as follows:

Value Fund A Class
----------------------------------------------------------------------------------------------
6/24/87**
YEAR ENDED NOVEMBER 30, TO
1994 1993 1992 1991 1990 1989 1988 11/30/87
<S> <C> <C> <C> <C> <C> <C> <C> <C>

Net asset value,
beginning of period........ $20.070 $17.750 $15.320 $11.050 $14.030 $10.440 $7.740 $9.530

Income from investment
operations:
Net investment income
(loss)..................... 0.142 0.033 0.060 (0.006) 0.149 0.131 0.054 0.058
Net realized and unrealized
gain (loss) from security
transactions .............. (0.687) 3.147 3.360 4.681 (2.269) 3.529 2.691 (1.848)
-------- -------- ------- ------- ------- ------- ------- ------
Total from investment
operations................. (0.545) 3.180 3.420 4.675 (2.120) 3.660 2.745 (1.790)

Less distributions:
Dividends from net
investment income.......... (0.035) (0.040) none (0.155) (0.140) (0.070) (0.045) none
Distributions from net
realized gain on security
transactions (0.170) (0.820) (0.990) (0.250) (0.720) none none none
-------- -------- ------- ------- ------- ------- ------- ------
Total distributions......... (0.205) (0.860) (0.990) (0.405) (0.860) (0.070) (0.045) none
Net asset value, end
of period.................. $19.320 $20.070 $17.750 $15.320 $11.050 $14.030 $10.440 $7.740
======== ======== ======= ======= ======= ======== ======= ======

Total return*............... (2.78%) 18.59% 22.99% 43.61% (16.14%) 35.28% 35.57% (18.78%)

Ratios/supplemental data:
Net assets, end of period
(000 omitted).............. $179,498 $151,384 $38,792 $12,041 $7,746 $11,055 $6,797 $8,780
Ratio of expenses to average
net assets................. 1.46% 1.64% 1.93% 2.26% 1.79% 1.98%+ 2.02%+ 1.50%+
Ratio of net investment
income (loss) to net
assets .................... 0.75% 0.25% 0.39% (0.07%) 1.12% 1.14%++ 0.35%++ 1.74%++
Portfolio turnover.......... 14% 32% 68% 99% 69% 103% 66% 60%

</TABLE>

--------------
* Does not include maximum sales charge of 5.75% nor the 1% limited contingent
deferred sales charge that would apply in the event of certain redemptions
within 12 months of purchase.
** Date of initial public offering; ratios and total return have been
annualized.
+ Ratio of expenses to average net assets prior to expense limitation was
2.16% for 1989, 2.23% for 1988 and 2.26% for 1987.
++ Ratio of net investment income to average net assets prior to expense
limitation was 0.97% for 1989, 0.14% for 1988, and 0.99% for 1987.

<PAGE>

NOTES TO FINANCIAL STATEMENTS (CONTINUED)

6. FINANCIAL HIGHLIGHTS
Selected data for each share of the Fund outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>

VALUE FUND INSTITUTIONAL CLASS VALUE FUND B CLASS
---------------------------------- ------------------
YEAR YEAR 11/9/92* 9/6/94*
ENDED ENDED TO TO
11/30/94 11/30/93 11/30/92 11/30/94
<S> <C> <C> <C> <C>
Net asset value, beginning of period....................... $20.140 $17.750 $17.090 $20.280

Income from investment operations:
Net investment income ..................................... 0.195 0.092 0.004 0.011
Net realized and unrealized gain from security transactions (0.685) 3.158 0.656 (0.991)
------- ------- ------- -------
Total from investment operations........................... (0.490) 3.250 0.660 (0.980)

Less distributions:
Dividends from net investment income......................... (0.080) (0.040) none none
Distributions from net realized gain on security transactions (0.170) (0.820) none none
------- ------- ------- -------
Total distributions.......................................... (0.250) (0.860) none none
Net asset value, end of period............................... $19.400 $20.140 $17.750 $19.300
======= ======= ======= =======

Total return**............................................... (2.51%) 19.00% 3.86% (4.83%)

Ratios/supplemental data:
Net assets, end of period (000 omitted)...................... $6,385 $5,476 $1,558 $1,455
Ratio of expenses to average net assets...................... 1.16% 1.34% 1.63% 2.16%
Ratio of net investment income to net assets................. 1.05% 0.55% 0.69% 0.05%
Portfolio turnover........................................... 14% 32% 68% 14%

</TABLE>
-------------
* Date of initial public offering; ratios have been annualized and total
return has not been annualized.
** Does not reflect any contingent deferred sales charge which varies from
1% - 4% depending upon the holding period for Value Fund B Class.

See accompanying notes

<PAGE>

DELAWARE GROUP VALUE FUND, INC.
REPORT OF INDEPENDENT AUDITORS

To the Shareholders and Board of Directors
Delaware Group Value Fund, Inc.

We have audited the accompanying statement of net assets of Delaware Group
Value Fund, Inc. as of November 30, 1994, and the related statement of
operations for the year then ended, the statement of changes in net assets
for each of the two years in the period then ended, and the financial
highlights for each of the seven years in the period then ended and the
period June 24, 1987 (date of initial public offering) to November 30, 1987.
These financial statements and financial highlights are the responsibility of
the Fund's management. Our responsibility is to express an opinion on these
financial statements and financial highlights based on our audits.

We conducted our audits in accordance with generally accepted auditing
standards. Those standards require that we plan and perform the audit to
obtain reasonable assurance about whether the financial statements and
financial highlights are free of material misstatement. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures
in the financial statements. Our procedures included confirmation of
investments owned as of November 30, 1994 by correspondence with the custodian
and brokers. An audit also includes assessing the accounting principles used
and significant estimates made by management, as well as evaluating the
overall financial statement presentation. We believe that our audits provide
a reasonable basis for our opinion.

In our opinion, the financial statements and financial highlights referred to
above present fairly, in all material respects, the financial position of
Delaware Group Value Fund, Inc. at November 30, 1994, the results of its
operations for the year then ended, the changes in its net assets for each of
the two years in the period then ended, and the financial highlights for each
of the seven years in the period then ended and the period June 24, 1987
(date of initial public offering) to November 30, 1987, in conformity with
generally accepted accounting principles.

ERNST & YOUNG LLP

Philadelphia, Pennsylvania
January 6, 1995

<PAGE>

BOARD MEMBERS

MR. WAYNE A. STORK
Chairman
Delaware Group of Funds
Philadelphia, PA

MR. WALTER P. BABICH
Board Chairman
Citadel Constructors, Inc.
King of Prussia, PA

MR. JOHN K. CASTLE
Chairman
Castle Harlan, Inc.
New York, NY

DR. JOHN J. CONNOLLY
President and CEO
Castle Connolly Medical Ltd.
New York, NY

MR. JOHN H. DURHAM
former Chairman
Delaware Group of Funds
Philadelphia, PA

MR. LEONARD M. HARLAN
President
Castle Harlan, Inc.
New York, NY

<PAGE>

MR. ANTHONY D. KNERR
Consultant
Anthony Knerr & Associates
New York, NY

MS. ANN R. LEVEN
Deputy Treasurer
National Gallery of Art
Washington, DC

MR. W. THACHER LONGSTRETH
Vice Chairman
Packquisition Corp.
Philadelphia, PA

MR. CHARLES E. PECK
former Chairman and CEO
The Ryland Group, Inc.
Columbia, MD

MR. BRIAN F. WRUBLE
President and CEO
Delaware Group of Funds
Philadelphia, PA

OTHER AFFILIATED OFFICERS

MR. KEITH E. MITCHELL
President and CEO
Delaware Distributors, L.P.

MR. DAVID K. DOWNES
President
Delaware Management Trust Company

MR. GEORGE M. CHAMBERLAIN, JR.
Secretary
Delaware Group of Funds

This annual report is for the information of Value Fund shareholders, but it
may be used with prospective investors when preceded or accompanied by a
current PROSPECTUS, which gives details about charges, expenses, investment
objectives and operating policies of the Fund. Summary investment results are
documented in the current STATEMENT OF ADDITIONAL INFORMATION. If used with
prospective investors after March 31, 1995, this report must also be
accompanied by a Value Fund Performance Update for the most recently
completed calendar quarter. The figures in this report represent past
results, and are not a guarantee of future performance. The return and
principal of an investment in the Fund will fluctuate so that shares, when
redeemed, may be worth more or less than their original cost.

<PAGE>

The Delaware Group includes funds with a wide range of investment objectives.
Stock funds, income funds, tax-free funds, money market funds and closed-end
equity/income funds give investors the ability to create a portfolio that
fits their personal financial goals.

For a prospectus of any Delaware Group fund, contact your financial adviser
or call the Delaware Group at 800-523-4640 or 215-988-1333 in Philadelphia.

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 CREDIT UNION
OR ANY BANK, ARE NOT OBLIGATIONS OF ANY CREDIT UNION OR ANY BANK, AND INVOLVE
INVESTMENT RISK, INCLUDING POSSIBLE LOSS OF PRINCIPAL. SHARES OF THE FUND ARE
NOT CREDIT UNION OR BANK DEPOSITS.

A TRADITION OF SOUND INVESTING SINCE 1929

PHOTO OF VARIOUS
OBJECTS

INVESTMENT MANAGER
Delaware Management Company, Inc.
Philadelphia
|
INTERNATIONAL AFFILIATE |
Delaware International Advisers Ltd. |
London 1994 |
|
NATIONAL DISTRIBUTOR ANNUAL |
Delaware Distributors, L.P. |
Philadelphia REPORT |
| DELAWARE
SHAREHOLDER SERVICING, | GROUP
DIVIDEND DISBURSING | ---------
AND TRANSFER AGENT | Value Fund
Delaware Service Company, Inc. |
Philadelphia

1/95-PP-AR-021