<PAGE>
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM N-1A
File No. 33-40991
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933 [ X ]
Pre-Effective Amendment No. ________ [_____]
Post-Effective Amendment No. 8 [ X ]
--------
AND
REGISTRATION STATEMENT UNDER THE INVESTMENT COMPANY ACT OF 1940 [ X ]
Amendment No. 8
------
DELAWARE POOLED TRUST, INC.
--------------------------------------------------------------------------------
(Exact Name of Registrant as Specified in Charter)
1818 Market Street, Philadelphia, Pennsylvania 19103
--------------------------------------------------------------------------------
(Address of Principal Executive Offices) (Zip Code)
Registrant's Telephone Number, including Area Code: (215) 751-2923
--------------
George M. Chamberlain, Jr., 1818 Market Street, Philadelphia, PA 19103
--------------------------------------------------------------------------------
(Name and Address of Agent for Service)
Approximate Date of Public Offering: November 29, 1995
-----------------
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)
_____ on date pursuant to paragraph (a)(1)
X 75 days after filing pursuant to paragraph (a)(2)
-----
on ________, 1995 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. The Rule 24f-2 Notice for
Registrant's most recent fiscal year was filed on December 28, 1994.
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
--- C O N T E N T S ---
This Post-Effective Amendment No. 8 to Registration File No. 33-40991 includes
the following:
1. Facing Page
2. Contents Page
3. Cross-Reference Sheet
4. Part A - Prospectus
5. Part B - Statement of Additional Information
6. Part C - Other Information
7. Signatures
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
CROSS-REFERENCE SHEET
---------------------
PART A
------
<TABLE>
<CAPTION>
Item No. Description Location in Prospectus
-------- ----------- ----------------------
<C> <S> <C>
1 Cover Page ............................. Cover
2 Fund Expenses .......................... Fund Expenses
3 Condensed Financial Information ........ Financial Highlights
4 General Description of Registrant ...... Investment Objectives, Policies
and Risk Considerations
5 Management of the Fund ................. Management of the Fund
6 Capital Stock and Other Securities ..... Dividends and Capital Gains
Distributions, Taxes
7 Purchase of Securities Being Offered ... Purchase of Shares, Cover,
Management of the Fund
8 Redemption or Repurchase ............... Redemption of Shares, Purchase
of Shares
9 Legal Proceedings ...................... None
</TABLE>
<PAGE>
PRELIMINARY PROSPECTUS DATED SEPTEMBER 15, 1995
SUBJECT TO COMPLETION
DELAWARE POOLED TRUST
---------------------
Delaware Pooled Trust, Inc. ("Fund") is a no-load, open-end management
investment company. The Fund consists of twelve portfolios (collectively, the
"Portfolios," or, individually, a "Portfolio") offering investment alternatives
for institutional clients. Investors may make investments in only one or in
more than one of the following Portfolios:
<TABLE>
EQUITY ORIENTED FIXED INCOME ORIENTED
<S> <C>
The Defensive Equity Portfolio The Fixed Income Portfolio
The Aggressive Growth Portfolio The Limited-Term Maturity Portfolio
The International Equity Portfolio The Global Fixed Income Portfolio
The Defensive Equity Small/Mid-Cap Portfolio The International Fixed Income Portfolio
The Defensive Equity Utility Portfolio The High-Yield Bond Portfolio
The Labor Select International Equity Portfolio
The Real Estate Investment Trust Portfolio
</TABLE>
--------------------------------------------------------------------------------
The Fund is designed to meet the investment needs of discerning institutional
investors who desire experienced investment management and place a premium on
personal service.
The Fund's High-Yield Bond Portfolio invests up to 100% of its assets in lower
rated fixed income securities, commonly known as "junk bonds," which involve
greater risks, including default risks, than higher rated fixed income
securities. Purchasers should carefully assess these risks before investing in
The High-Yield Bond Portfolio. See "INVESTMENT OBJECTIVES, POLICIES AND RISK
CONSIDERATIONS" and "ADDITIONAL INVESTMENT INFORMATION - HIGH-YIELD, HIGH RISK
SECURITIES."
This Prospectus is designed to set forth concisely the information about the
Fund that a prospective institutional client should know before investing and it
should be retained for future reference. Additional information about the Fund
is contained in a Statement of Additional Information dated____________________,
1995, as it may be amended from time to time. That information is incorporated
herein by reference and is available without charge upon request from the Fund:
Delaware Pooled Trust, Inc.
One Commerce Square
2005 Market Street
Philadelphia, PA 19103
1-800-231-8002
--------------------------------------------------------------------------------
<PAGE>
--------------------------------------------------------------------------------
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS PROSPECTUS SHALL NOT CONSTITUTE AN OFFER TO SELL OR THE
SOLICITATION OF AN OFFER TO BUY NOR SHALL THERE BE ANY SALE OF THESE SECURITIES
IN ANY STATE IN WHICH SUCH OFFER, SOLICITATION OR SALE WOULD BE UNLAWFUL PRIOR
TO REGISTRATION OR QUALIFICATION UNDER THE SECURITIES LAWS OF ANY SUCH STATE.
--------------------------------------------------------------------------------
<TABLE>
<CAPTION>
TABLE OF CONTENTS
Page Page
<S> <C> <C> <C>
Fund Expenses...........................3 Redemption of Shares............................37
Financial Highlights....................6 Additional Investment Information...............40
Delaware Pooled Trust Summary...........9 Investment Limitations..........................54
Fund Officers and Portfolio Management of the Fund..........................55
Managers.............................11 Shareholder Services............................58
Risk Factors...........................17 Dividends and Capital Gains
Investment Objectives, Policies Distributions..................................59
and Risk Considerations...............19 Taxes...........................................60
Purchase of Shares.....................35 Performance Information.........................63
Appendix A--Ratings.............................65
</TABLE>
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.
The date of this Prospectus is:
___________________, 1995
-2-
<PAGE>
FUND EXPENSES
The following table illustrates all expenses and fees that a shareholder of the
Fund can expect to incur:
<TABLE>
<CAPTION>
The The The
The The The The Limited- Global International
Shareholder Defensive Aggressive International Fixed Term Fixed Fixed
Transaction Equity Growth Equity Income Maturity Income Income
Expenses Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- --------- ---------- ------------- --------- --------- --------- --------------
<S> <C> <C> <C> <C> <C> <C> <C>
Sales Charge Imposed
on Purchases None None None None None None None
Sales Charge Imposed
on Reinvested
Dividends None None None None None None None
Redemption Fees None None None None None None None
Exchange Fees None None None None None None None
</TABLE>
<TABLE>
<CAPTION>
The The The
Annual Fund The The The The Limited- Global International
Operating Expenses Defensive Aggressive International Fixed Term Fixed Fixed
(as a percentage of Equity Growth Equity Income Maturity Income Income
average net assets) Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------------- --------- ---------- ------------- --------- --------- -------- ---------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment Advisory
Fees After
Voluntary Waiver
and Reimbursement .39%* .55%* .71%* .32%* .22%* .33%* .02%*
12b-1 Fees None None None None None None None
Other Expenses After
Voluntary Waiver
and Reimbursement .29%* .38%* .23%* .21%* .21%* .27%* .58%*
----- ----- ----- ----- ----- ----- -----
Total Operating
Expenses .68%* .93%* .94%* .53%* .43%* .60%* .60%*
===== ===== ===== ===== ===== ===== =====
</TABLE>
The purpose of this table is to assist the investor in understanding the various
expenses that an investor in the Fund will bear directly or indirectly. With
respect to The Defensive Equity Small/Mid-Cap Portfolio, The Defensive Equity
Utility Portfolio, The Labor Select International Equity Portfolio, The Real
Estate Investment Trust Portfolio, The Fixed Income Portfolio, The Limited-Term
Maturity Portfolio, The International Fixed Income Portfolio, and The High-Yield
Bond Portfolio, the amounts set forth above under the heading "Other Expenses
After Voluntary Waiver and Reimbursement" are based on estimates for the
Portfolios' initial fiscal year in which they conduct operations. With respect
to The Defensive Equity Portfolio, The Aggressive Growth Portfolio, The
International Equity Portfolio and The Global Fixed Income Portfolio, the
amounts set forth above under the heading "Other Expenses After Voluntary Waiver
and Reimbursement" are based on actual results for the Portfolios' most recently
completed fiscal year.
-3-
<PAGE>
<TABLE>
<CAPTION>
The The The
Defensive The Labor Real The
Equity Defensive Select Estate High-
Shareholder Small/ Equity International Investment Yield
Transaction Mid-Cap Utility Equity Trust Bond
Expenses Portfolio Portfolio Portfolio Portfolio Portfolio
----------- --------- --------- ------------- ----------- ---------
<S> <C> <C> <C> <C> <C>
Sales Charge Imposed
on Purchases None None None None None
Sales Charge Imposed
on Reinvested
Dividends None None None None None
Redemption Fees None None None None None
Exchange Fees None None None None None
</TABLE>
<TABLE>
The The The
Defensive The Labor Real The
Annual Fund Equity Defensive Select Estate High-
Operating Expenses Small/ Equity International Investment Yield
(as a percentage of Mid-Cap Utility Equity Trust Bond
average net assets) Portfolio Portfolio Portfolio Portfolio Portfolio
------------------- --------- --------- ------------ ---------- ---------
<S> <C> <C> <C> <C> <C>
Investment Advisory
Fees After
Voluntary Waiver
and Reimbursement .00%** .35%** .75%** .75%** .45%**
12b-1 Fees None None None None None
Other Expenses After
Voluntary Waiver
and Reimbursement .00%** .14%** .21%** .14%** .14%**
------ ------ ------ ------ ------
Total Operating
Expenses 0.00%** .49%** .96%** .89%** .59%**
======= ====== ====== ====== ======
</TABLE>
-4-
<PAGE>
*With respect to The Defensive Equity Portfolio, The Aggressive Growth
Portfolio, The Fixed Income Portfolio and The Limited-Term Maturity Portfolio,
Delaware Investment Advisers elected voluntarily to waive that portion, if any,
of the annual Investment Advisory Fees payable by a particular Portfolio and to
reimburse a Portfolio for its expenses to the extent necessary to ensure that
the expenses of that Portfolio (exclusive of taxes, interest, brokerage
commissions and extraordinary expenses) do not exceed, on an annualized basis,
the amounts noted above during the period from commencement of the public
offering for the Portfolio through October 31, 1995. Similarly, Delaware
International Advisers Ltd. ("Delaware International"), the investment adviser
to The International Equity Portfolio, voluntarily elected to waive that
portion, if any, of its annual Investment Advisory Fees and to reimburse the
Portfolio for its expenses to the extent necessary to ensure that the expenses
of that Portfolio (exclusive of taxes, interest, brokerage commissions and
extraordinary expenses) do not exceed, on an annualized basis, .96% during the
period from commencement of the public offering for the Portfolio through
October 31, 1995. With respect to The Global Fixed Income Portfolio and The
International Fixed Income Portfolio, Delaware International, the Portfolios'
investment adviser, voluntarily elected to waive that portion, if any, of its
annual Investment Advisory Fees and to reimburse each Portfolio for its expenses
to the extent necessary to ensure that the expenses of that Portfolio (exclusive
of taxes, interest, brokerage commissions and extraordinary expenses) do not
exceed, on an annualized basis, the amounts noted above during the period from
commencement of the public offering for the Portfolio through October 31, 1995.
In the absence of such voluntary waivers, Total Operating Expenses (as a
percentage of average net assets) are expected to equal 0.82%, 1.17%, 0.97%,
0.61%, 0.51%,0.76% and 1.08%, respectively, for the Portfolios in the order they
appear in the above table. Other Operating Expenses for The International Fixed
Income Portfolio are estimates derived from The Global Fixed Income Portfolio
and assume the voluntary waiver of fees will be in effect. See "MANAGEMENT OF
THE FUND" for a recital of the Investment Advisory Fees to which each adviser is
entitled under its Investment Management Agreement.
**All expense figures are estimates assuming that each Portfolio has average net
assets equal to $75 million. With respect to The Defensive Equity Small/Mid-Cap
Portfolio, The Defensive Equity Utility Portfolio, The Real Estate Investment
Trust Portfolio and The High-Yield Bond Portfolio, Delaware Investment Advisers
has elected voluntarily to waive that portion, if any, of the annual Investment
Advisory Fee payable by such Portfolios and to reimburse each Portfolio for its
expenses to the extent necessary to ensure that the expenses of each Portfolio
(exclusive of taxes, interest, brokerage commissions and extraordinary expenses)
do not exceed, as a percentage of average net assets, on an annualized basis,
.___%, .49%, .89% and .59%, respectively, during the period from the
commencement of the public offering of such Portfolios through October 31, 1996.
Similarly, Delaware International, the investment adviser to The Labor Select
International Equity Portfolio, has elected voluntarily to waive that portion,
if any, of the annual Investment Advisory Fee payable by The Labor Select
International Equity Portfolio and to reimburse the Portfolio for its expenses
to the extent necessary to ensure that the expenses of that Portfolio (exclusive
of taxes, interest, brokerage commissions and extraordinary expenses) do not
exceed, on an annualized basis, .96% of such Portfolio's average net assets
during the period from the commencement of the public offering of the Portfolio
through October 31, 1996. In the absence of such voluntary waivers, Total
Operating Expenses (as a percentage of average net assets) are expected to equal
____%, ____%, ____%, ____% and _____%, respectively, for the Portfolios in the
order that they appear in the above table. Other Operating Expenses for each of
the Portfolios are estimated. See "MANAGEMENT OF THE FUND" for a recital of the
Investment Advisory Fees to which each adviser is entitled under its Investment
Management Agreement.
-5-
<PAGE>
The following example illustrates the expenses that you would incur on a $1,000
investment, assuming (1) a 5% annual rate of return, and (2) redemption at the
end of each time period. As noted in the table above, the Fund charges no
redemption fees.
<TABLE>
<CAPTION>
1 year 3 years 5 years 10 years
------ ------ ------- --------
<S> <C> <C> <C> <C>
The Defensive Equity Portfolio $ 7 $22 $38 $ 85
The Aggressive Growth Portfolio 9 30 51 114
The International Equity Portfolio 10 30 52 115
The Fixed Income Portfolio 5 17 30 66
The Limited-Term Maturity Portfolio 4 14 24 54
The Global Fixed Income Portfolio 6 19 33 75
The International Fixed Income Portfolio 6 19 33 75
</TABLE>
<TABLE>
1 year* 3 years*
------- --------
<S> <C> <C>
The Defensive Equity Small/Mid-Cap Portfolio $ 8 $25
The Defensive Equity Utility Portfolio $ 5 $16
The Labor Select International Equity Portfolio $10 $31
The Real Estate Investment Trust Portfolio $ 9 $28
The High-Yield Bond Portfolio $ 6 $19
* Assumes net assets of each Portfolio equal to $75 million.
</TABLE>
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 the initial offerings of The Defensive
Equity Portfolio, The Aggressive Growth Portfolio, The International Equity
Portfolio and The Global Fixed Income Portfolio through October 31, 1994 are
derived from the financial statements of each of those Portfolios of the Fund
and have been audited by Ernst & Young LLP, independent auditors. The data
should be read in conjunction with the financial statements, related notes, and
the report of Ernst & Young LLP covering such financial information and
highlights all of which are incorporated by reference into Part B. Further
information about The Defensive Equity, The Aggressive Growth, The International
Equity and The Global Fixed Income Portfolios' performance is contained in their
respective Annual Reports to shareholders. A copy of each Portfolio's Annual
Report (including the report of Ernst & Young LLP) may be obtained from the Fund
upon request at no charge. Except for the initial sale of shares to Delaware
Management Company, Inc., The Defensive Equity Small/Mid-Cap Portfolio, The
Defensive Equity Utility Portfolio, The Labor Select International Equity
Portfolio, The Real Estate Investment Trust Portfolio, The Fixed Income
Portfolio, The Limited-Term Maturity Portfolio, The International Fixed Income
Portfolio, and The High-Yield Bond Portfolio have sold no shares to investors.
Consequently, no financial highlights are being supplied for these eight
Portfolios. Unaudited financial highlights for the six months ended April 30,
1995 for The Defensive Equity Portfolio, The Aggressive Growth Portfolio, The
International Equity Portfolio and The Global Fixed Income Portfolio are also
provided below.
--------------------------------------------------------------------------------
-6-
<PAGE>
<TABLE>
<CAPTION>
The Defensive The Aggressive
Equity Portfolio Growth Portfolio
---------------- ----------------
Period Period
11/1/94 Period 11/1/94 Period
through 2/3/92(2) through 2/27/92(1)
4/30/95(1) Year ended through 4/30/95(1) Year ended through
(Unaudited) 10/31/94 10/31/93 10/31/92 (Unaudited) 10/31/94 10/31/93 10/31/92
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period.. $ 13.0800 $ 12.7300 $ 10.6600 $10.0000 $ 11.0100 $ 11.2000 $ 9.0400 $ 10.0000
Income From Investment Operations
---------------------------------
Net Investment Income................. 0.1863 0.3203 0.2841 0.2291 0.0258 0.0075 0.0181 0.0167
Net Gains (Losses) on Securities
(both realized and unrealized)... 0.8337 0.6527 2.3159 0.5109 0.5022 0.0325 2.1589 (0.9767)
------ ------ ------ ------ ------ ------ ------ --------
Total From Investment Operations... 1.0200 0.9730 2.6000 0.7400 0.5280 0.0400 2.1770 (0.9600)
------ ------ ------ ------ ------ ------ ------ --------
Less Distributions
------------------
Dividends (from net investment income) (0.2600) (0.2800) (0.3200) (0.0800) (0.0120) (0.0200) (0.0170) none
Distributions (from capital gains).... (0.4900) (0.3430) (0.2100) none (0.2360) (0.2100) none none
Returns of Capital.................... none none none none none none none none
---- ---- ---- ---- ---- ---- ---- ----
Total Distributions............... (0.7500) (0.6230) (0.5300) (0.0800) (0.2480) (0.2300) (0.0170) none
------- -------- ------- -------- -------- -------- -------- ----
Net Asset Value, End of Period........ $ 13.3500 $ 13.0800 $ 12.7300 $10.6600 $ 11.2900 $ 11.0100 $11.2000 $ 9.0400
========= ========= ========= ======== ========= ========= ======== ==========
----------------------------
Total Return.......................... 8.47% 7.96% 25.17% 10.13% 5.01% 0.34% 24.10% (13.89%)
----------------------------
Ratios/Supplemental Data
------------------------
Net Assets, End of Period
(000's omitted)..................... $ 54,123 $ 37,323 $ 13,418 $ 4,473 $ 26,245 $ 22,640 $ 20,478 $ 4,538
Ratio of Expenses to
Average Daily Net Assets............ 0.68%(3) 0.68%(3) 0.68%(3) 0.68%(3) 0.93%(3) 0.93%(3) 0.93%(3) 0 .93%(3)
Ratio of Net Investment
Income to Average Daily Net Assets... 3.50%(4) 3.26%(4) 2.90%(4) 3.65%(4) 0.51%(4) 0.07%(4) 0.23%(4) 0.28%(4)
Portfolio Turnover Rate............... 56% 73% 37% 28% 54% 43% 81% 34%
</TABLE>
---------------------
(1) Ratios have been annualized but total return has not been annualized.
(2) Date of initial sale; ratios and total return have been annualized.
(3) Ratio of expenses to average daily net assets prior to voluntary management
fee waiver was 0.73% for the six months ended 4/30/95, 0.82% for the year
ended 10/31/94, 1.38% for the year ended 10/31/93 and 2.38% for the period
ended 10/31/92 for The Defensive Equity Portfolio; 1.16% for the six months
ended 4/30/95, 1.17% for the year ended 10/31/94, 1.40% for the year ended
10/31/93 and 2.56% for the period ended 10/31/92 for The Aggressive Growth
Portfolio; 0.97% for the year ended 10/31/94, 1.38% for the year ended
10/31/93 and 2.94% for the period ended 10/31/92 for the International
Equity Portfolio; and 0.65% for the six months ended 4/30/95, 0.76% for the
year ended 10/31/94 and 0.88% for the period ended 10/31/93 for The Global
Fixed Income Portfolio.
(4) Ratio of net investment income (loss) to average daily net assets prior to
voluntary management fee waiver was 3.45% for the six months ended 4/30/95,
3.12% for the year ended 10/31/94, 2.20% for the year ended 10/31/93 and
1.95% for the period ended 10/31/92 for The Defensive Equity Portfolio;
0.28% for the six months ended 4/30/95, (0.17%) for the year ended
10/31/94, (0.24%) for the year ended 10/31/93 and (1.35%) for the period
ended 10/31/92 for The Aggressive Growth Portfolio; 1.33% for the year
ended 10/31/94, 2.56% for the year ended 10/31/93 and 2.69% for the period
ended 10/31/92 for The International Equity Portfolio; and 7.23% for the
six months ended 4/30/95, 3.48% for the year ended 10/31/94 and 10.42% for
the period ended 10/31/93 for The Global Fixed Income Portfolio.
-7-
<PAGE>
<TABLE>
<CAPTION>
The International The Global
Equity Portfolio Fixed Income Portfolio
---------------- ----------------------
Period Period
11/1/94 Period 11/1/94 Period
through 2/4/92(2) through Year 11/30/92(2)
4/30/95(1) Year ended through 4/30/95(1) ended through
(Unaudited) 10/31/94 10/31/93 10/31/92 (Unaudited) 10/31/94 10/31/93
<S> <C> <C> <C> <C> <C> <C> <C>
Net Asset Value, Beginning of Period.. $ 13.1100 $ 11.9900 $ 9.5000 $10.0000 $ 9.7900 $ 11.0900 $10.0000
Income From Investmen Operations
--------------------------------
Net Investment Income................. (0.0149) 0.1440 0.2414 0.2282 0.4109 0.4189 0.9547
Net Gains (Losses) on Securities
(both realized and unrealized)... (0.0691) 1.2360 2.5686 (0.6282) 0.0991 (0.1929) 0.7433
-------- ------ ------ -------- ------ -------- ------
Total From Investment Operations.... (0.0840) 1.3800 2.8100 (0.4000) 0.5100 0.2260 1.6980
-------- ------ ------ -------- ------ -------- ------
Less Distributions
------------------
Dividends (from net investment income) (0.1100) (0.1600) (0.3200) (0.1000) (0.2300) (0.9490) (0.6080)
Distributions (from capital gains).... (0.2960) (0.1000) none none none (0.5770) none
Returns of Capital.................... none none none none none none none
---- ---- ---- ---- ---- ----- ----
Total Distributions................. (0.4060) (0.2600) (0.3200) (0.1000) (0.2300) (1.5260) (0.6080)
-------- ------ ------ -------- ------ -------- ------
Net Asset Value, End of Period........ $ 12.6200 $ 13.1100 $ 11.9900 $ 9.5000 $ 10.0700 $ 9.7900 $11.0900
========= ========= ========= ======== ========= ========= ========
---------------------------------
Total Return.......................... (0.51%) 11.66% 30.28% (5.44%) 5.28% (2.07%) 18.96%
------------
---------------------------------
Ratios/Supplemental Data
------------------------
Net Assets, End of Period
(000's omitted)..................... $ 96,086 $ 70,820 $ 24,288 $ 5,966 $ 76,268 $ 42,266 $ 29,313
Ratio of Expenses to
Average Daily Net Assets............ 0.93% 0.94%(3) 0.96%(3) 0.96%(3) 0.60%(3) 0.62%(3) 0.62%(3)
Ratio of Net Investment Income to
Average Daily Net Assets............ (0.61%) 1.36%(4) 2.98%(4) 4.67%(4) 7.28%(4) 3 .62%(4) 10.68%(4)
Portfolio Turnover Rate............... 12% 22% 28% 2% 61% 205% 198%
</TABLE>
---------------------
(1) Ratios have been annualized but total return has not been annualized.
(2) Date of initial sale; ratios and total return have been annualized.
(3) Ratio of expenses to average daily net assets prior to voluntary management
fee waiver was 0.73% for the six months ended 4/30/95, 0.82% for the year
ended 10/31/94, 1.38% for the year ended 10/31/93 and 2.38% for the period
ended 10/31/92 for The Defensive Equity Portfolio; 1.16% for the six months
ended 4/30/95, 1.17% for the year ended 10/31/94, 1.40% for the year ended
10/31/93 and 2.56% for the period ended 10/31/92 for The Aggressive Growth
Portfolio; 0.97% for the year ended 10/31/94, 1.38% for the year ended
10/31/93 and 2.94% for the period ended 10/31/92 for the International
Equity Portfolio; and 0.65% for the six months ended 4/30/95, 0.76% for the
year ended 10/31/94 and 0.88% for the period ended 10/31/93 for The Global
Fixed Income Portfolio.
(4) Ratio of net investment income (loss) to average daily net assets prior to
voluntary management fee waiver was 3.45% for the six months ended 4/30/95,
3.12% for the year ended 10/31/94, 2.20% for the year ended 10/31/93 and
1.95% for the period ended 10/31/92 for The Defensive Equity Portfolio;
0.28% for the six months ended 4/30/95, (0.17%) for the year ended
10/31/94, (0.24%) for the year ended 10/31/93 and (1.35%) for the period
ended 10/31/92 for The Aggressive Growth Portfolio; 1.33% for the year
ended 10/31/94, 2.56% for the year ended 10/31/93 and 2.69% for the period
ended 10/31/92 for The International Equity Portfolio; and 7.23% for the
six months ended 4/30/95, 3.48% for the year ended 10/31/94 and 10.42% for
the period ended 10/31/93 for The Global Fixed Income Portfolio.
-8-
<PAGE>
DELAWARE POOLED TRUST SUMMARY
THE FUND
The Fund consists of twelve Portfolios offering institutional investors a broad
range of investment choices coupled with the advantage of a no-load mutual fund
with the service companies of The Delaware Group providing customized services
as investment adviser, administrator and distributor. Each Portfolio, other
than The Defensive Equity Utility Portfolio, The Real Estate Investment Trust
Portfolio, The Global Fixed Income Portfolio and The International Fixed Income
Portfolio, is a diversified fund as defined by the Investment Company Act of
1940 ("1940 Act"). The Defensive Equity Utility Portfolio, The Real Estate
Investment Trust Portfolio, The Global Fixed Income Portfolio and The
International Fixed Income Portfolio are nondiversified funds as defined by the
1940 Act. The investment objectives and principal policies of each of the
twelve Portfolios are as follows:
The Defensive Equity Portfolio--seeks to realize maximum long-term total return,
consistent with reasonable risk, through investments in equity securities of
companies which, at the time of purchase, have dividend yields above the current
yield of the Standard & Poor's 500 Stock Index and which, in the opinion of
Delaware Investment Advisers, offer capital gains potential as well.
The Aggressive Growth Portfolio--seeks to realize maximum long-term capital
growth by investing in equity securities of smaller and medium-sized companies
that, in the opinion of Delaware Investment Advisers, offer, at the time of
purchase, superior long-term growth potential.
The International Equity Portfolio--seeks to achieve maximum long-term total
return by investing primarily in equity securities of issuers organized or
having a majority of their assets in or deriving a majority of their operating
income outside of the United States which, in the opinion of Delaware
International Advisers Ltd., are undervalued, at the time of purchase, based on
rigorous fundamental analysis conducted by the investment adviser.
The Defensive Equity Small/Mid-Cap Portfolio--seeks to realize maximum long-term
total return. The Portfolio seeks to achieve this objective by investing in
equity securities of companies which, at the time of purchase, have dividend
yields above the current yield of the Standard & Poor's 500 Stock Index, have a
market capitalization below that of the third decile of companies registered on
the New York Stock Exchange, and which, in Delaware Investment Advisers'
opinion, offer capital gains potential.
The Defensive Equity Utility Portfolio--seeks to realize maximum long-term total
return. The Portfolio seeks to achieve this objective by investing at least 65%
of its total assets in equity securities of utility companies which, at the time
of purchase, have dividend yields above the current yield of the Standard &
Poor's 500 Stock Index and which, in the opinion of Delaware Investment
Advisers, offer capital gains potential.
The Labor Select International Equity Portfolio--seeks to achieve maximum long-
term total return. The Portfolio seeks to achieve this objective by investing
primarily in equity securities of issuers organized or having a majority of
their assets in or deriving a majority of their operating income outside of the
United States which, in the opinion of Delaware International Advisers Ltd., are
undervalued, at the time of purchase, based on rigorous fundamental analysis
conducted by the investment adviser, and furthermore, present certain
characteristics that are compatible or operate in accordance with certain
investment policies or restrictions followed by organized labor.
The Real Estate Investment Trust Portfolio--seeks to achieve maximum long-term
total return. Capital appreciation is a secondary objective. The Portfolio
seeks to achieve its objectives by investing at least 65% of its total assets in
real estate securities, primarily equity real estate investment trusts and real
estate operating companies.
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The Fixed Income Portfolio--seeks to realize maximum long-term total return,
consistent with reasonable risk, by investing in a diversified portfolio of
investment grade fixed income obligations. The Portfolio will include U.S.
Government securities, mortgage-backed securities, corporate bonds, and other
fixed income securities.
The Limited-Term Maturity Portfolio--seeks to provide a high level of current
income, consistent with the preservation of principal and reasonable risk. The
Portfolio will include U.S. Government securities, mortgage-backed securities,
corporate bonds, and other fixed income securities. At no time will the average
maturity of the Portfolio exceed five years.
The Global Fixed Income Portfolio--seeks to achieve current income consistent
with the preservation of investors' principal. The Portfolio seeks to achieve
this objective by investing primarily in fixed income securities of issuers
organized or having a majority of their assets in or deriving a majority of
their operating income in at least three different countries, one of which may
be the United States and that may also provide the potential for capital
appreciation.
The International Fixed Income Portfolio--seeks to achieve current income
consistent with the preservation of investors' principal. The Portfolio seeks
to achieve this objective by investing primarily in fixed income securities of
issuers organized or having a majority of their assets in or deriving a majority
of their operating income in at least three different countries outside of the
United States and that may also provide the potential for capital appreciation.
Under normal circumstances, the Portfolio intends to invest in securities that
are denominated in foreign currencies.
The High-Yield Bond Portfolio--seeks high total return. The Portfolio seeks to
achieve its objective by investing primarily in bonds rated CCC or higher by
Standard & Poor's Corporation or Caa or higher by Moody's Investors Service,
Inc.
For further information, see "INVESTMENT OBJECTIVES, POLICIES AND RISK
CONSIDERATIONS" and "ADDITIONAL INVESTMENT INFORMATION."
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INVESTMENT MANAGEMENT
Delaware Investment Advisers, a division of Delaware Management Company, Inc.
("Delaware"), acts as investment adviser to The Defensive Equity, The Aggressive
Growth, The Fixed Income, The Limited-Term Maturity, The Defensive Equity
Small/Mid-Cap, The Defensive Equity Utility, The Real Estate Investment Trust
and The High-Yield Bond Portfolios. The investment management fees payable to
Delaware Investment Advisers by these Portfolios are, respectively, .55%, .80%,
.40%, .30%, .___%, .35%, .75% and .45% of the respective Portfolio's average net
assets. Lincoln Investment Management, Inc., acts as sub-adviser to The Real
Estate Investment Trust Portfolio and receives 30% of the management fee paid to
Delaware. Delaware International Advisers Ltd. ("Delaware International"), an
affiliate of Delaware , is the investment adviser to The International Equity,
The Global Fixed Income, The International Fixed Income and The Labor Select
International Equity Portfolios. The investment management fees payable to
Delaware International by The International Equity Portfolio, The Global Fixed
Income Portfolio , The International Fixed Income Portfolio and The Labor Select
International Equity Portfolio are, respectively, .75%, .50%, .50% and .75% of
the respective Portfolio's average net assets. In addition, out of the
investment advisory fees to which they are otherwise entitled, Delaware and
Delaware International pay their proportionate share of the fees paid to
unaffiliated directors by the Fund, except that Delaware will make no such
payments out of the fees it receives for managing The Defensive Equity
Small/Mid-Cap, The Defensive Equity Utility, The Real Estate Investment Trust
and The High-Yield Bond Portfolios and Delaware International will make no
such payments out of the fees it receives for managing The International Fixed
Income and The Labor Select International Equity Portfolios. See "MANAGEMENT
OF THE FUND."
FUND OFFICERS AND PORTFOLIO MANAGERS
Wayne A. Stork
Chairman
A graduate of Brown University, Mr. Stork also attended the NYU Graduate School
of Business Administration while a senior transportation analyst at the Irving
Trust Company. He joined Delaware in 1962 as a security analyst covering a wide
range of industry groups. In 1975, he became Chief Investment Officer of
Delaware Investment Advisers, President in 1984, and in 1990 was named Chairman.
Mr. Stork is a Director of Delaware Management Company, Inc. and its affiliates,
and is Chairman of the Delaware Group of funds. He is a member of the Institute
of Chartered Financial Analysts and the Financial Analysts Federation.
Winthrop S. Jessup
President and Chief Executive Officer
Mr. Jessup is a graduate of Brown University where he majored in Economics. He
was a Vice President of Kidder, Peabody & Co. Inc. prior to joining Delaware in
1977. In 1988, he was named Executive Vice President of Delaware Management
Company, Inc. and its Delaware Investment Advisers division. Mr. Jessup is also
Executive Vice President of the Delaware Group of funds, and a Director of
Delaware Management Company, Inc. and its affiliates.
David G. Tilles
Managing Director and Chief Investment Officer - Delaware International Advisers
Ltd.
Mr. Tilles was educated at the Sorbonne, Warwick University and Heidelberg
University. Prior to joining Delaware in 1990 as Managing Principal and Chief
Investment Officer of Delaware International Advisers Ltd., he spent 16 years
with Hill Samuel Investment Management Group in London, serving in a number of
investment capacities. His most recent position prior to joining Delaware was
Chief Investment Officer of Hill Samuel Investment Advisers Ltd.
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George E. Deming
Vice President/Senior Portfolio Manager - The Defensive Equity Portfolio
Mr. Deming received his BA in Economics and Political Science from the
University of Vermont and an MA in International Affairs from the University of
Pennsylvania. Prior to joining Delaware in 1978, he was responsible for
portfolio management and institutional sales at White, Weld & Co., Inc. He is a
member of the Financial Analysts of Philadelphia. Mr. Deming has managed The
Defensive Equity Portfolio since its inception.
Edward N. Antoian
Vice President/Senior Portfolio Manager - The Aggressive Growth Portfolio
Mr. Antoian holds a BS from The State University of New York at Albany and
earned an MBA in Finance from the University of Pennsylvania's Wharton School.
Mr. Antoian began his career with Price Waterhouse. Prior to joining Delaware
in 1984, he worked in the Institutional Equity Department of E. F. Hutton in
Philadelphia. He is a Chartered Financial Analyst and a member of the
Philadelphia Finance Association and the Philadelphia Securities Association.
Mr. Antoian has managed The Aggressive Growth Portfolio since its inception.
Timothy W. Sanderson
Portfolio Manager - The International Equity Portfolio
A graduate of University College, Oxford, Mr. Sanderson began his investment
career in 1979 with Hill Samuel Investment Management Group. Prior to joining
Delaware International Advisers Ltd. in 1990 as Senior Portfolio Manager and
Director, he was an analyst and senior portfolio manager for Hill Samuel where,
since 1987, he had responsibility for Pacific Basin research and the management
of international institutional portfolios. Mr. Sanderson has managed The
International Equity Portfolio since its inception.
David C. Dalrymple
Vice President/Senior Portfolio Manager - The Defensive Equity Small/Mid-Cap
Portfolio
Mr. Dalrymple holds a BS in Business Administration from Clarkson College in
Potsdam, NY, and an MBA from Cornell's Johnson School of Management in Ithaca,
NY. Prior to joining Delaware Management Company in December of 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. Mr. Dalrymple has managed The Defensive
Equity Small/Mid-Cap Portfolio since its inception.
Bernard P. Schaffer
Vice President/Senior Portfolio Manager - The Defensive Equity Utility Portfolio
Mr. Schaffer is a graduate of Villanova University and holds an MBA in Finance
from the University of Pennsylvania's Wharton School. He began his career at
White, Weld & Co., Inc. and subsequently held the position of associate managing
director at Wertheim Schroder & Company. Prior to joining Delaware Management
Company in February of 1990, Mr. Schaffer was a Senior Vice President with
Prudential Capital Funding. Mr. Schaffer has managed The Defensive Equity
Utility Portfolio since its inception.
Clive A. Gillmore
Director/Senior Portfolio Manager - The Labor Select International Equity
Portfolio
A graduate of the Warwick University, England, and the London Business School
Investment Program, Mr. Gillmore joined Delaware in 1990 after eight years of
investment experience. His most recent position prior to joining Delaware was
as a Pacific Basin equity analyst and senior portfolio manager for Hill Samuel
Investment Advisers Ltd. Prior to that, Mr. Gillmore was an analyst and
portfolio manager for Legal and General Investment in the United Kingdom. Mr.
Gillmore has managed of The Labor Select International Equity Portfolio since
its inception.
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<PAGE>
George H. Burwell
Vice President/Senior Portfolio Manager - The Real Estate Investment Trust
Portfolio
Mr. Burwell holds a BA from the University of Virginia with a major in Political
Science and a minor in Economics. Prior to joining the Delaware Group in 1992,
Mr. Burwell was a portfolio manager for Midlantic Bank in Edison, New Jersey,
where he managed an equity mutual fund and three commingled funds. He has also
held the position of security analyst with Balis & Born in New York and First
Fidelity Bank in New Jersey. Mr. Burwell is a Chartered Financial Analyst. Mr.
Burwell has served as a portfolio manager of The Real Estate Investment Trust
Portfolio since its inception.
Babak Zenouzi
Vice President/Portfolio Manager - The Real Estate Investment Trust Portfolio
Mr. Zenouzi holds a BS in Finance and Economics from Babson College in
Wellesley, Massachusetts, and an MS in Finance from Boston College. Prior to
joining Delaware in 1992, he was with The Boston Company where he held the
positions of assistant vice president, senior financial analyst, financial
analyst and portfolio accountant. Mr. Zenouzi has served as a portfolio manager
of The Real Estate Investment Trust Portfolio since its inception.
Dennis Blume
Senior Vice President/Director of Real Estate Operations - Lincoln Investment
Management, Inc.
Sub-adviser to The Real Estate Investment Trust Portfolio
Mr. Blume holds a BS and an MBA from Indiana University. He joined Lincoln
Investment Management, Inc. in 1972 and has held several senior positions in the
real estate and public bond areas. He is a member of the Board of Directors of
Lynch & Mayer, Inc., Vantage Global Advisors, Inc., Lincoln Investment
Management, Inc., and East Wayne Street Center. Mr. Blume is a Chartered
Financial Analyst. Mr. Blume has served as a sub-adviser for The Real Estate
Investment Trust Portfolio since its inception.
John F. Robertson
Assistant Vice President/Real Estate Investments - Lincoln Investment
Management, Inc.
Sub-adviser to The Real Estate Investment Trust Portfolio
Mr. Robertson holds a BA from Wabash College where he was graduated magna cum
laude and awarded membership into Phi Beta Kappa, and an MBA with emphasis in
finance and real estate from Indiana University. Prior to joining Lincoln
Investment Management, Inc.'s Real Estate Debt Group in 1993, he was a
consultant with Ernst & Young's Special Services Group where he specialized in
the valuation of all types of commercial real estate. Mr. Robertson has
completed numerous courses toward the MAI designation and is a candidate for the
CFA designation. Mr. Robertson has served as a sub-adviser for The Real Estate
Investment Trust Portfolio since its inception.
Gary A. Reed
Vice President/Senior Portfolio Manager - The Fixed Income Portfolio
Mr. Reed holds an AB in Economics from the University of Chicago and an MA in
Economics from Columbia University. He began his investment career in 1978 with
The Equitable Life Assurance Society, specializing in credit analysis. Prior to
joining Delaware Investment Advisers in 1989, Mr. Reed served as Vice President
and Manager of the Fixed Income Department at Irving Trust Company. Mr. Reed
has managed both discretionary and structured fixed income portfolios and is
experienced with a broad range of high-grade fixed income securities.
Additionally, he has developed investment programs for Decommissioning Trust
Funds and supervised their management. Mr. Reed has managed The Fixed Income
Portfolio since its inception.
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<PAGE>
Ian G. Sims
Portfolio Manager - The Global Fixed Income Portfolio and The International
Fixed Income Portfolio
Mr. Sims is a graduate of the University of Leicester and holds a postgraduate
degree in statistics from the University of Newcastle-Upon-Tyne. He joined
Delaware International Advisers Ltd. in 1990 as a senior international fixed
income and currency manager. Mr. Sims began his investment career with the
Standard Life Assurance Co., and subsequently moved to the Royal Bank of Canada
Investment Management International Company, where he was an international fixed
income manager. Prior to joining Delaware, he was a senior fixed income and
currency portfolio manager with Hill Samuel Investment Advisers Ltd. Mr. Sims
has managed The Global Fixed Income Portfolio since its inception and will
manage The International Fixed Income Portfolio when it commences operations.
Paul A. Matlack
Vice President/Senior Portfolio Manager - The High-Yield Bond Portfolio
Mr. Matlack is a graduate of the University of Pennsylvania and received his MBA
in Finance from George Washington University. He began his career with Mellon
Bank as a credit specialist analyzing leveraged transactions in the chemical and
pharmaceutical industries. He subsequently served as a loan officer in Mellon's
Corporate Lending Division and in the Special Industries Group at Provident
National Bank, before joining Delaware in 1989. He is a Chartered Financial
Analyst. Mr. Matlack has served as a portfolio manager of The High-Yield Bond
Portfolio since its inception.
Gerald T. Nichols
Vice President/Senior Portfolio Manager - The High-Yield Bond Portfolio
Mr. Nichols is a graduate of the University of Kansas, where he received an MS
in Finance and a BS in Business Administration. Prior to joining Delaware in
1989, he was the investment officer for a merchant banking firm with interests
in the insurance and thrift industries. Mr. Nichols began his career in the
high-yield bond market with Waddell and Reed, Inc. in 1983 where, as a high-
yield credit analyst, he followed a variety of industries. He is a Chartered
Financial Analyst. Mr. Nichols has served as a portfolio manager of The High-
Yield Bond Portfolio since its inception.
James R. Raith, Jr.
Vice President/Senior Portfolio Manager - The High-Yield Bond Portfolio
Mr. Raith is a 1973 graduate of Holy Cross University and received his MBA in
Finance from Tulane University in 1975. Prior to joining Delaware in 1987, he
held portfolio management positions in both fixed income and equity management.
Mr. Raith has been an active participant in the high-yield bond market since
1980. His past experience includes the management of $8 billion of life
insurance reserves at ICH Corporation, a major holder and issuer of high-yield
debentures (1985-1987), and the management of high-yield pension assets for
Firestone Tire and Rubber (1980-1985). He is a Chartered Financial Analyst.
Mr. Raith has served as a portfolio manager of The High-Yield Bond Portfolio
since its inception.
Maria E. Pollack
Assistant Vice President and Administrative Manager
Ms. Pollack joined the Delaware organization in 1982 and has served in a number
of senior administrative capacities. After attending Chestnut Hill College and
Temple University, she began her career as executive assistant to the Chairman
of the Delaware Group of funds and Delaware Investment Advisers. Prior to
becoming Administrative Manager for the Fund, she was responsible for
coordinating administrative activity for institutional shareholders in another
investment program maintained by the Delaware Group.
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<PAGE>
ADMINISTRATIVE SERVICES
Delaware Service Company, Inc., an affiliate of Delaware Management Company,
Inc. and Delaware International Advisers Ltd., provides the Fund with
administrative, dividend disbursing and transfer agency services. See
"MANAGEMENT OF THE FUND."
SPECIAL REPORTS AND OTHER SERVICES
The Fund provides client shareholders with annual audited financial reports and
unaudited semi-annual financial reports. In addition, the investment advisers'
dedicated service staff may also provide client shareholders detailed monthly
appraisals of the status of their account and complete reviews of portfolio
assets, performance results, and other pertinent data. Finally, the investment
advisers' service staff expects to conduct personal reviews no less than
annually with each shareholder, with interim telephone updates and other
communications, as appropriate. The Fund's dedicated telephone number (1-800-
231-8002) is available for shareholder inquiries during normal business hours.
The net asset values for the Portfolios are also available by using the above
"800" telephone number. Written correspondence should be addressed to:
Delaware Pooled Trust, Inc.
One Commerce Square
2005 Market Street
Philadelphia, PA 19103
Attn: Client Services
From time to time, certain institutional separate accounts advised by Delaware
Investment Advisers or Delaware International may invest in the Fund's
Portfolios. The Portfolios may experience relatively large investments or
redemptions as a result of the institutional separate accounts either purchasing
or redeeming the Portfolios' shares. These transactions will affect the
Portfolios, since Portfolios that experience redemptions may be required to sell
portfolio securities, and Portfolios that receive additional cash will need to
invest it. While it is impossible to predict the overall impact of these
transactions over time, there could be adverse effects on portfolio management
to the extent the Portfolios may be required to sell securities or invest cash
at times when they would not otherwise do so. Delaware Investment Advisers and
Delaware International, representing the interests of the Portfolios, is
committed to minimizing the impact of such transactions on the Portfolios. In
addition, Delaware Investment Advisers and Delaware International, as adviser to
the institutional separate accounts, is also committed to minimizing the impact
on the Portfolios to the extent it is consistent with pursuing the investment
objectives of the institutional separate accounts.
In cases where a shareholder of any of the Portfolios has an investment
counseling relationship with Delaware Investment Advisers or Delaware
International, Delaware Investment Advisers or Delaware International may, at
its discretion, reduce the shareholder's investment counseling fees by an amount
equal to the pro-rata advisory fees paid by the respective Portfolio. This
procedure will be utilized with clients having contractual relationships based
on total assets managed by Delaware Investment Advisers or Delaware
International to avoid situations where excess advisory fees might be paid to
Delaware Investment Advisers or Delaware International. In no event will a
client pay higher total advisory fees as a result of the client's investment in
a Portfolio.
See "SHAREHOLDER SERVICES."
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CUSTODIAL SERVICES
The Morgan Guaranty Trust Company of New York, 60 Wall Street, New York, NY
10260, acts as the Fund's custodian bank.
HOW TO INVEST
Shares of each Portfolio are offered directly to institutional investors at net
asset value with no sales commissions or 12b-1 charges. The minimum initial
investment for a Portfolio of the Fund is $1,000,000. There is no minimum for
subsequent investments in a Portfolio where the minimum initial investment has
been satisfied. In addition, institutional investors in The International
Equity and The Labor Select International Equity Portfolios may, under certain
circumstances, be required to make their investments in the respective
Portfolio, pursuant to instructions of the Fund, by a contribution of securities
in-kind to the Portfolio or by following another procedure that will have the
same economic effect as an in-kind purchase; in either case, such investors will
be required to pay the brokerage or other transaction costs arising in
connection with acquiring the subject securities. At such time as the Fund
receives appropriate regulatory approvals to do so in the future, under certain
circumstances, the Fund may, at its sole discretion, allow institutional
investors who have an existing investment counseling relationship with Delaware
Investment Advisers or Delaware International to make investments in the
Portfolios by a contribution of securities in-kind to such Portfolios. See
"PURCHASE OF SHARES."
HOW TO REDEEM
Shares of each Portfolio may be redeemed at any time, without cost, at the net
asset value per share of the Portfolio next determined after receipt of the
redemption request. The redemption price may be more or less than the purchase
price and the redemption may be in cash or, under certain circumstances, in-
kind. If a shareholder reduces their investment in a Portfolio below $500,000,
their investment in that Portfolio may be subject to redemption. In addition,
investors in The International Equity, The Labor Select International Equity,
The Global Fixed Income and The International Fixed Income Portfolios may, under
certain circumstances, be required to accept their redemption, pursuant to
instructions from the Fund, in-kind in portfolio securities or, at the election
of the investor, by following another procedure that will have the same economic
effect as an in-kind redemption; in either case, such investors will be required
to pay the brokerage or other transaction costs arising in connection with the
sale of the subject securities. See "REDEMPTION OF SHARES."
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RISK FACTORS
An investment in the Fund entails certain risks and considerations about which
an investor should be aware.
Because both The Aggressive Growth Portfolio(which seeks long-term capital
growth) and The Defensive Equity Small/Mid-Cap Portfolio (which seeks to
maximize long-term total return) invest primarily in small- to medium-sized
companies,the Portfolios' investments are likely to involve a higher degree of
liquidity risk and price volatility than if investments were made in larger
capitalization securities. The Aggressive Growth Portfolio and The Real Estate
Investment Trust Portfolio also may, under certain circumstances, use certain
futures contracts and options on futures contracts, as well as options on stock.
The International Equity ,The Labor Select International Equity, The Global
Fixed Income, and The International Fixed Income Portfolios will invest in
securities of foreign issuers which normally are denominated in foreign
currencies and may hold foreign currency directly. In addition, The Defensive
Equity Utility, The Real Estate Investment Trust and The High-Yield Bond
Portfolios may invest up to 10% of their total assets in foreign securities.
Consequently, these Portfolios may be affected by changes in currency rates and
exchange control regulations and may incur costs in connection with conversions
between currencies. To hedge this currency risk associated with investments in
non-U.S. dollar denominated securities, a Portfolio may invest in forward
foreign currency contracts. Those activities pose special risks which do not
typically arise in connection with investments in U.S. securities. In addition,
The Defensive Equity Utility, The Real Estate Investment Trust, and The
International Fixed Income Portfolios may engage in foreign currency options and
futures transactions. For a discussion of the risks associated with these
instruments see "RISKS OF TRANSACTIONS IN OPTIONS, FUTURES AND FORWARD
CONTRACTS."
The foreign securities in which The International Equity, The Labor Select
International Equity, The Global Fixed Income, and The International Fixed
Income Portfolios (and The Defensive Equity Utility, The Real Estate Investment
Trust and The High-Yield Bond Portfolios, up to 10% of their total assets) may
invest from time to time may be listed primarily on foreign exchanges which
trade on days when the New York Stock Exchange is closed (such as Saturday). As
a result, the net asset value of the Portfolios may be significantly affected by
such trading on days when shareholders will have no access to the Portfolios.
See "VALUATION OF SHARES."
The Real Estate Investment Trust Portfolio concentrates its investments in the
real estate industry, and The Defensive Equity Utility Portfolio concentrates
its investments in the utility industry. As a consequence, the net asset values
of the Portfolios can be expected to fluctuate in light of the factors affecting
those industries, and may fluctuate more widely than a portfolio that invests in
a broader range of industries. The Defensive Equity Utility and The Real Estate
Investment Trust Portfolios may be more susceptible to any single economic,
political or regulatory occurrence affecting the utility or real estate
industry, respectively.
The High-Yield Bond Portfolio invests in lower rated fixed income securities,
which, while generally having higher yields, are subject to factors, such as
reduced creditworthiness of issuers, increased risks of default and a more
limited and less liquid secondary market than higher rated securities. These
securities are subject to greater volatility and risk of loss of income and
principal than are higher rated securities. See "INVESTMENT OBJECTIVES,
POLICIES AND RISK CONSIDERATIONS" and "ADDITIONAL INVESTMENT INFORMATION - HIGH-
YIELD, HIGH RISK SECURITIES."
The Fixed Income, The Limited-Term Maturity, The Global Fixed Income and The
International Fixed Income Portfolios will normally experience annual portfolio
turnover rates exceeding 100%, but those rates are not expected to exceed 250%
with respect to The Fixed Income Portfolio and 200% with respect to The Limited-
Term Maturity, The Global Fixed Income and The International Fixed Income
Portfolios. Such relatively high portfolio turnover rates involve
correspondingly higher brokerage commissions, for equity transactions, and other
transaction costs and may affect the taxes payable by the Portfolios'
shareholders that are subject to federal
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<PAGE>
income tax. See "INVESTMENT OBJECTIVES, POLICIES AND RISK CONSIDERATIONS"
"PORTFOLIO TRANSACTIONS" and "TAXES."
The Fixed Income, The Limited-Term Maturity and The Global Fixed Income
Portfolios may invest in collateralized mortgage obligations and those
Portfolios, as well as The Real Estate Investment Trust Portfolio, may invest in
mortgage-backed securities. See "ADDITIONAL INVESTMENT INFORMATION--MORTGAGE-
BACKED SECURITIES."
The Real Estate Investment Trust Portfolio, by investing primarily in securities
of real estate investment trusts, is subject to interest rate risk, in that as
interest rates decline, the value of the Portfolio's investment in real estate
investment trusts can be expected to rise. Conversely, when interest rates
rise, the value of the Portfolio's investments in real estate investment trusts
holding fixed rate obligations can be expected to decline. See "ADDITIONAL
INVESTMENT INFORMATION--REITS."
Each of the twelve Portfolios may lend its portfolio securities, may invest in
repurchase agreements and may purchase securities on a when-issued basis.
While The Defensive Equity Utility Portfolio, The Real Estate Investment Trust
Portfolio, The Global Fixed Income Portfolio and The International Fixed Income
Portfolio intend to seek to qualify as a "diversified" investment company under
provisions of Subchapter M of the Internal Revenue Code, they will not be
diversified under the 1940 Act. Thus, while at least 50% of each Portfolio's
total assets will be represented by cash, cash items, certain qualifying
securities and other securities limited in respect of any one issuer to an
amount not greater than 5% of the Portfolio's total assets, it will not satisfy
the 1940 Act requirement in this respect, which applies that test to 75% of the
Portfolio's assets. A nondiversified portfolio is believed to be subject to
greater risk because adverse effects on the portfolio's security holdings may
affect a larger portion of the overall assets.
Each of the investment strategies identified above involves special risks which
are described under "INVESTMENT OBJECTIVES, POLICIES AND RISK CONSIDERATIONS"
and "ADDITIONAL INVESTMENT INFORMATION" in this Prospectus and "INVESTMENT
POLICIES, PORTFOLIO TECHNIQUES AND RISK CONSIDERATIONS" in the Statement of
Additional Information.
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<PAGE>
INVESTMENT OBJECTIVES, POLICIES
AND RISK CONSIDERATIONS
The investment objective of each Portfolio of the Fund is described below,
together with the policies each Portfolio employs in its efforts to achieve its
objective. There is no assurance that a Portfolio will attain its objective.
The investment objective of each Portfolio is fundamental and may only be
changed by a majority approval of that Portfolio's shareholders. Unless
otherwise noted, the investment policies described below are not fundamental
policies and may be changed without shareholder approval.
THE DEFENSIVE EQUITY PORTFOLIO
The Defensive Equity Portfolio's investment objective is to realize maximum
long-term total return, consistent with reasonable risk. The Portfolio seeks to
achieve this objective by investing in equity securities of companies which, at
the time of purchase, have dividend yields above the current yield of the
Standard & Poor's 500 Stock Index ("S&P 500 Index") and which, in the investment
adviser's opinion, offer capital gains potential as well.
In selecting Portfolio securities, the investment adviser places an emphasis on
strong relative performance in falling markets. The Portfolio invests primarily
in equity securities of U.S. companies, although from time to time the Portfolio
will include sponsored or unsponsored American Depository Receipts actively
traded in the United States. Under normal market conditions, at least 65% of
the Portfolio's total assets will be invested in equity securities. Equity
securities for this purpose include, but are not limited to, common stocks,
securities convertible into common stocks and securities having common stock
characteristics, such as rights and warrants to purchase common stocks. The
Portfolio also may purchase preferred stock. The Portfolio may hold cash or
invest in short-term debt securities and other money market instruments when, in
the investment adviser's opinion, such holdings are prudent given then
prevailing market conditions. Except when the investment adviser believes a
temporary defensive approach is appropriate, the Portfolio, normally, will not
hold more than 5% of its total assets in cash or such short-term investments.
All these short-term investments will be of the highest quality as determined by
a nationally-recognized statistical rating organization (e.g., AAA by Standard &
Poor's Corporation ("S&P") or Aaa by Moody's Investors Service, Inc.
("Moody's")) or be of comparable quality as determined by the investment
adviser. Appendix A of this Prospectus describes the ratings of S&P and
Moody's. See "ADDITIONAL INVESTMENT INFORMATION" for further details concerning
these and other investment policies.
The investment adviser seeks to invest in high-yielding equity securities and
believes that, although capital gains are important, the dividend return
component will be a significant portion of the expected total return. The
investment adviser believes that a diversified portfolio of such high-yielding
stocks will outperform the market over the long-term, as well as preserve
principal in difficult market environments. Companies considered for purchase
generally will exhibit the following characteristics at the time of purchase: 1)
a dividend yield greater than the prevailing yield of the S&P 500 Index; 2) a
price-to-book ratio lower than the average large capitalization company; and 3)
a below-market price-to-earnings ratio.
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The investment adviser takes a long-term investment approach by placing a strong
emphasis on its ability to determine attractive values and, generally, does not
seek to respond to short-term changes in the market. It is anticipated that the
annual turnover rate of the Portfolio will not exceed 100% under normal
circumstances. The Portfolio will maintain diversity among economic sectors and
industries and will not invest 25% or more of its total assets in the stocks of
issuers in any one industry, nor, ordinarily, more than 5%, at the time of
purchase, of any one company.
THE AGGRESSIVE GROWTH PORTFOLIO
The Aggressive Growth Portfolio's investment goal is to realize maximum long-
term capital growth. The Portfolio seeks to attain this objective by investing
in equity securities of smaller and medium-sized companies which, in the opinion
of the investment adviser, present, at the time of purchase, significant long-
term growth potential. In pursuing this objective, current income is expected
to be incidental.
The Portfolio invests primarily in growth-oriented common stocks of small- to
medium-sized domestic corporations. Such companies, in the investment adviser's
view, generally are those companies that have total market capitalization
between $100 million and $2.5 billion at the time of purchase. The Portfolio
may invest in securities issued by companies having a capitalization outside
that range when, in the investment adviser's opinion, such a company exhibits
the same characteristics and growth potential as companies within the range.
Equity securities for this purpose include, but are not to be limited to, common
stocks, securities convertible into common stocks and securities having common
stock characteristics, such as rights and warrants to purchase common stocks.
The Portfolio also may purchase preferred stock. Although the investment
adviser does not pursue a market timing approach to investing, the Portfolio may
hold cash or invest in short-term debt securities or other money market
instruments when, in the investment adviser's opinion, such holdings are prudent
given the prevailing market conditions. Except when the investment adviser
believes a temporary defensive approach is appropriate, the Portfolio, normally,
will not hold more than 10% of its total assets in cash or such short-term
investments, but, on occasion, may hold as much as 30% of its total assets in
cash or such short-term investments. All such holdings will be of the highest
quality as determined by a nationally-recognized statistical rating organization
(e.g., AAA by S&P or Aaa by Moody's) or be of comparable quality as determined
by the investment adviser. See "ADDITIONAL INVESTMENT INFORMATION."
The Portfolio may also, to a limited extent, enter into futures contracts on
stocks, purchase or sell options on such futures, engage in certain options
transactions on stocks and enter into closing transactions with respect to those
activities. However, these activities will not be entered into for speculative
purposes, but rather to facilitate the ability quickly to deploy into the stock
market the Portfolio's positions in cash, short-term debt securities and other
money market instruments, at times when the Portfolio's assets are not fully
invested in equity securities. Such positions will generally be eliminated when
it becomes possible to invest in securities that are appropriate for the
Portfolio. See "ADDITIONAL INVESTMENT INFORMATION--FUTURES CONTRACTS AND
OPTIONS ON FUTURES CONTRACTS" and "OPTIONS" for a further discussion of these
investment policies.
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The Portfolio will not invest 25% or more of its total assets in securities of
companies which conduct their principal business activities in specific
industries. The Portfolio expects to invest in small- to medium-sized companies
that have been in existence for at least three years (including the operation of
any predecessor company) but which have the potential, in the investment
adviser's judgment, for significant long-term capital growth. The investment
adviser assesses economic, industry, market and company developments to select
investments in promising emerging growth companies that are expected to benefit
from new technology, new products or services, research discoveries, rejuvenated
management and the like. However, the Portfolio may invest in any equity
security which, in the investment adviser's judgment, provides the potential for
significant capital appreciation.
The investment adviser believes that consistent earnings per share growth is
just as important as high absolute growth. Because the Portfolio seeks long-
term capital growth by investing primarily in small- to medium-sized companies,
its investments are likely to involve a higher degree of liquidity risk and
price volatility than larger capitalization securities.
The investment adviser does not normally intend to respond to short-term market
fluctuations or to acquire securities for the purpose of short-term trading;
however, the investment adviser may take advantage of short-term opportunities
that are consistent with its investment objective. It is anticipated that the
annual turnover rate of the Portfolio, under normal circumstances, will not
exceed 100%.
THE INTERNATIONAL EQUITY PORTFOLIO
The investment objective of The International Equity Portfolio is to achieve
maximum long-term total return. The Portfolio seeks to achieve its objective by
investing primarily in equity securities of issuers organized or having a
majority of their assets or deriving a majority of their operating income
outside the United States, and which, in the investment adviser's opinion, are
undervalued at the time of purchase based on fundamental analysis employed by
the investment adviser.
In selecting portfolio securities the investment adviser emphasizes strong
performance in falling markets relative to other mutual funds focusing on
international equity investments. Equity securities in which the Portfolio may
invest include, but are not limited to, common stocks and securities convertible
into common stock and securities having common stock characteristics, such as
rights and warrants to purchase common stocks. Additionally, the Portfolio may
from time to time, hold its assets in cash (which may be U.S. dollars or foreign
currency, including European Currency Units ("ECU")) or may invest in short-term
debt securities or other money market instruments. Except when the investment
adviser believes a temporary defensive approach is appropriate, the Portfolio
generally will not hold more than 5% of its assets in cash or such short-term
instruments. All such holdings will be of the highest quality as determined by
a nationally-recognized statistical rating organization (e.g., AAA by S&P or Aaa
by Moody's) or of comparable quality as determined by the Portfolio's investment
adviser.
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The Portfolio may hold up to 15% of its assets in foreign fixed income
securities when, in the investment adviser's opinion, equity securities are
overvalued and such fixed income securities present an opportunity for returns,
over an 18-month period, greater than those available through investments in
equity securities or the short-term investments described above. The foreign
fixed income securities in which the Portfolio may invest may be U.S. dollar or
foreign currency denominated, including ECU, and must have a government or
government agency backed credit status which would include, but not be limited
to, supranational entities. A supranational entity is an entity established or
financially supported by the national governments of one or more countries to
promote development or reconstruction. They include: The World Bank, European
Investment Bank, Asian Development Bank, European Economic Community, and the
Inter-American Development Bank. Such fixed income securities will be, at the
time of purchase, of the highest quality (e.g., AAA by S&P or Aaa by Moody's) or
of comparable quality as determined by the Portfolio's investment adviser. See
"ADDITIONAL INVESTMENT INFORMATION" for a further description of these and other
investment policies.
The investment adviser's approach in selecting investments for the Portfolio is
oriented to individual stock selection and is value driven. In selecting stocks
for the Portfolio, the investment adviser identifies those stocks which it
believes will provide the highest total return over a market cycle taking into
consideration the movement in the price of the individual security, and the
impact of currency adjustment on a United States domiciled, dollar-based
investor. The investment adviser conducts extensive fundamental research on a
global basis, and it is through this research effort that securities which, in
the investment adviser's opinion, have the potential for maximum long-term total
return are identified. The center of the fundamental research effort is a value
oriented dividend discount methodology toward individual securities and market
analysis which isolates value across country boundaries. This approach focuses
on future anticipated dividends and discounts the value of those dividends back
to what they would be worth if they were being paid today. Comparisons of the
values of different possible investments are then made. The investment
adviser's management approach is long-term in orientation, but, it is expected
that the annual turnover rate of the Portfolio will not exceed 150% under normal
circumstances. See "PORTFOLIO TRANSACTIONS" and "TAXES."
While the Portfolio is not subject to any specific geographic diversification
requirements, it will, under normal conditions, invest at least 65% of its total
assets in equity securities of issuers organized or having a majority of their
assets or deriving a majority of their operating income in at least three
different countries outside the United States. Investments will be made mainly
in marketable securities of companies located in developed countries, but the
stock markets of developing countries are rapidly becoming accessible and the
Portfolio may hold securities of issuers located in any developing country
determined to be appropriate by the investment adviser. Investments in
obligations of foreign issuers involve somewhat different investment risks than
those affecting obligations of United States issuers. The risks posed by
investments in emerging or developing countries frequently are greater. See
"ADDITIONAL INVESTMENT INFORMATION--FOREIGN INVESTMENT INFORMATION."
Currency considerations carry a special risk for a portfolio of international
securities, and the investment adviser employs a purchasing power parity
approach to evaluate currency risk. In this regard, the Portfolio will actively
carry on hedging activities, and may invest in forward foreign currency exchange
contracts to hedge currency risks associated with the purchase of individual
securities denominated in a particular currency. See "ADDITIONAL INVESTMENT
INFORMATION - FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS."
THE DEFENSIVE EQUITY SMALL/MID-CAP PORTFOLIO
The Defensive Equity Small/Mid-Cap Portfolio's investment objective is to
realize maximum long-term total return. The Portfolio seeks to achieve this
objective by investing primarily in equity securities of companies which, at the
time of purchase, have dividend yields above the current yield of the S&P 500
Index, have a market capitalization below that of the third decile of companies
registered on the New York Stock Exchange, and, in the investment adviser's
opinion, offer capital gains potential as well.
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In selecting Portfolio securities, the investment adviser places an emphasis on
strong relative performance in falling markets. The Portfolio invests primarily
in equity securities of U.S. companies, although from time to time the Portfolio
will include sponsored or unsponsored American Depository Receipts actively
traded in the United States. Under normal market conditions, at least 65% of
the value of Portfolio's total assets will be invested in equity securities.
Equity securities for this purpose include common stocks, securities convertible
into common stocks and securities having common stock characteristics, such as
rights and warrants to purchase common stocks. The Portfolio also may purchase
preferred stock, and certain other non-traditional equity securities. See
"ADDITIONAL INVESTMENT INFORMATION--CONVERTIBLE AND DEBT SECURITIES" and
"AMERICAN DEPOSITORY RECEIPTS" for further details concerning these and other
investment policies.
The Portfolio may hold cash or invest in short-term debt securities and other
money market instruments when, in the investment adviser's opinion, such
holdings are prudent given then prevailing market conditions. Except when the
investment adviser believes a temporary defensive approach is appropriate, the
Portfolio, normally, will not hold more than 5% of its total assets in cash or
such short-term investments. All these short-term investments will be of the
highest quality as determined by a nationally-recognized statistical rating
organization (e.g., AAA by S&P or Aaa by Moody's) or be of comparable quality as
determined by the investment adviser. See "ADDITIONAL INVESTMENT INFORMATION"
and "APPENDIX A - RATINGS" for further details concerning these and other
investment policies.
The investment adviser seeks to invest in high-yielding equity securities of
small and mid-cap companies and believes that, although capital gains are
important, the dividend return component will be a significant portion of the
expected total return. Further, the investment adviser believes that, although
more volatile, small and mid-cap companies will provide higher returns over the
long-term. In the investment adviser's opinion, a diversified portfolio of such
high-yielding, small and mid-cap companies will outperform the market over the
long-term, as well as preserve principal in difficult market environments.
Companies considered for purchase generally will exhibit the following
characteristics at the time of purchase: 1) a dividend yield greater than the
prevailing yield of the S&P 500 Index; and 2) market capitalization below that
of the third decile of companies registered on the New York Stock Exchange.
Such companies, in the investment adviser's view, generally are those companies
that currently have a total market capitalization of less than $3 billion at the
time of purchase.
The Portfolio expects to invest in companies in the capitalization range
described above, and that have been in existence for at least three years
(including the operation of any predecessor company) but which have the
potential, in the investment adviser's judgment, for providing long-term total
return. Because the Portfolio seeks long-term total return by investing
primarily in small to mid-cap companies, its investments are likely to involve a
higher degree of liquidity risk and price volatility than investments in larger
capitalization securities.
The investment adviser takes a long-term investment approach by placing a strong
emphasis on its ability to determine attractive values and, generally, does not
seek to respond to short-term changes in the market. It is anticipated that the
annual turnover rate of the Portfolio will not exceed 100% under normal
circumstances. The Portfolio will maintain diversity among economic sectors and
industries and will not invest 25% or more of its total assets in the stocks of
issuers in any one industry, nor, ordinarily, more than 5%, at the time of
purchase, of any one company.
THE DEFENSIVE EQUITY UTILITY PORTFOLIO
The Defensive Equity Utility Portfolio's investment objective is to realize
maximum long-term total return. The Portfolio seeks to achieve this objective
by investing primarily in equity securities of utility companies which, at the
time of purchase, have dividend yields above the current yield of the S&P 500
Index and which, in the investment adviser's opinion, offer capital gains
potential as well. The Portfolio will operate as a nondiversified fund for
purposes of the 1940 Act.
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In selecting Portfolio securities, the investment adviser places an emphasis on
strong relative performance in falling markets. The Portfolio invests primarily
in equity securities of U.S. utility companies, although from time to time the
Portfolio will include sponsored or unsponsored American Depository Receipts
actively traded in the United States. Under normal market conditions, at least
65% of the value of the Portfolio's total assets will be invested in equity
securities of utility companies. The Portfolio may invest in the equity
securities of electric utilities, and other regulated utilities including, but
not limited to, natural gas pipelines, water utilities and telephone utilities.
The Portfolio may also invest in the equity securities of utility holding
companies. Equity securities for this purpose include common stocks, securities
convertible into common stocks and securities having common stock
characteristics, such as rights and warrants to purchase common stocks. The
Portfolio also may purchase preferred stock and convertible securities. See
"ADDITIONAL INVESTMENT INFORMATION--CONVERTIBLE AND DEBT SECURITIES" and
"AMERICAN DEPOSITORY RECEIPTS" for a further discussion of these investment
policies.
The Portfolio may also invest up to 35% of its total assets in the debt
securities of utility companies. Generally, these debt securities will be
investment grade quality as determined by a nationally-recognized statistical
rating organization (e.g., BBB or better by S&P or Baa or better by Moody's) or
be of comparable quality as determined by the investment adviser. The Portfolio
may invest up to 10% of its assets in fixed income securities rated below
investment grade, including foreign government securities as discussed below.
The Portfolio may also invest up to 10% of its assets in securities of foreign
issuers. See "ADDITIONAL INVESTMENT INFORMATION--FOREIGN INVESTMENT
INFORMATION" and "HIGH-YIELD, HIGH RISK SECURITIES" for a further discussion of
these investment policies.
In connection with the Portfolio's ability to invest up to 10% of its total
assets in the securities of foreign issuers, currency consideration may present
risks if the Portfolio holds international securities. In this regard, the
Portfolio may carry on hedging activities, and may invest in forward foreign
currency exchange contracts to hedge currency risks associated with the purchase
of individual securities denominated in a particular currency. See "ADDITIONAL
INVESTMENT INFORMATION -- FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS."
The Portfolio may hold cash or invest in short-term debt securities and other
money market instruments when, in the investment adviser's opinion, such
holdings are prudent given then prevailing market conditions. Except when the
investment adviser believes a temporary defensive approach is appropriate, the
Portfolio, normally, will not hold more than 5% of its total assets in cash or
such short-term investments. All these short-term investments will be of the
highest quality as determined by a nationally-recognized statistical rating
organization (e.g., AAA by S&P or Aaa by Moody's) or be of comparable quality as
determined by the investment adviser. See "ADDITIONAL INVESTMENT INFORMATION"
for further details concerning these and other investment policies.
The investment adviser seeks to invest primarily in high-yielding equity
securities of utility companies and believes that, although capital gains are
important, the dividend return component will be a significant portion of the
expected total return. Further, the investment adviser believes that utility
companies will provide higher income and competitive long-term total returns.
The investment adviser believes that a diversified portfolio of such high-
yielding utility companies will provide more consistent returns than the broad
market, as well as preserve principal in difficult market environments. Equity
securities of companies considered for purchase generally will exhibit a
dividend yield greater than the prevailing yield of the S&P 500 Index.
The investment adviser takes a long-term investment approach by placing a strong
emphasis on its ability to determine attractive values and, generally, does not
seek to respond to short-term changes in the market. It is anticipated that the
annual turnover rate of the Portfolio will not exceed 100% under normal
circumstances. The Portfolio will not maintain diversity among economic sectors
and industries due to the specific nature of its investment objective, but will
not invest, ordinarily, more than 5% of its total assets, at the time of
purchase, in the securities of any one company.
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THE LABOR SELECT INTERNATIONAL EQUITY PORTFOLIO
The investment objective of The Labor Select International Equity Portfolio is
to achieve maximum long-term total return. The Portfolio seeks to achieve its
objective by investing primarily in equity securities of issuers organized or
having a majority of their assets or deriving a majority of their operating
income outside of the United States, and which, in the investment adviser's
opinion, are undervalued at the time of purchase based on rigorous fundamental
analysis employed by the investment adviser. In addition to following these
quantitative guidelines, the Portfolio's investment adviser will select
securities of issuers that present certain characteristics that are compatible
or operate in accordance with certain investment policies or restrictions
followed by organized labor.
In selecting portfolio securities, the investment adviser emphasizes strong
performance in falling markets relative to other mutual funds focusing on
international equity investments. Equity securities in which the Portfolio may
invest include common stocks and securities convertible into common stock and
securities having common stock characteristics, such as rights and warrants to
purchase common stocks. Additionally, the Portfolio may, from time to time,
hold its assets in cash (which may be U.S. dollars or foreign currency,
including the ECU) or may invest in short-term debt securities or other money
market instruments. Except when the investment adviser believes a temporary
defensive approach is appropriate, the Portfolio generally will not hold more
than 5% of its assets in cash or such short-term instruments. All such holdings
will be of the highest quality as determined by a nationally-recognized
statistical rating organization (e.g., AAA by S&P or Aaa by Moody's) or be of
comparable quality as determined by the Portfolio's investment adviser.
The Portfolio may hold up to 15% of its assets in foreign fixed income
securities when, in the investment adviser's opinion, equity securities are
overvalued and such fixed income securities present an opportunity for returns
greater than those available through investments in equity securities or the
short-term investments described above. The foreign fixed income securities in
which the Portfolio may invest may be U.S. dollar or foreign currency
denominated, including the ECU, and must have a government or government agency
backed credit status which would include, but not be limited to, supranational
entities. A supranational entity is an entity established or financially
supported by the national governments of one or more countries to promote
development or reconstruction. They include: The World Bank, European
Investment Bank, Asian Development Bank, European Economic Community, and the
Inter-American Development Bank. Such fixed income securities will be, at the
time of purchase, of the highest quality (e.g., AAA by S&P or Aaa by Moody's) or
be of comparable quality as determined by the Portfolio's investment adviser.
See "ADDITIONAL INVESTMENT INFORMATION" for a further description of these and
other investment policies.
The investment adviser's approach in selecting investments for the Portfolio is
primarily quantitatively oriented to individual stock selection and is value
driven. In selecting stocks for the Portfolio, the investment adviser
identifies those stocks which it believes will provide the highest total return
over a market cycle, taking into consideration the movement in the price of the
individual security, the impact of currency adjustment on a United States
domiciled, dollar-based investor, and the investment guidelines described below.
The investment adviser conducts extensive fundamental research on a global
basis, and it is through this research effort that securities which, in the
investment adviser's opinion, have the potential for maximum long-term total
return are identified. The center of the fundamental research effort is a value
oriented dividend discount methodology toward individual securities and market
analysis which isolates value across country boundaries. This approach focuses
on future anticipated dividends and discounts the value of those dividends back
to what they would be worth if they were being paid today. Comparisons of the
values of different possible investments are then made.
Supplementing the adviser's quantitative approach to stock selection, the
investment adviser will, in managing the Portfolio, also attempt to follow
certain qualitative investment guidelines which seek to identify issuers that
present certain characteristics that are compatible or operate in accordance
with certain investment policies or restrictions followed by organized labor.
These qualitative investment guidelines include country screens, as well as
additional issuer-specific criteria. The country screens require that the
securities are of issuers domiciled
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in those countries that are included in the Morgan Stanley Capital International
Europe, Australia and Far East ("EAFE") Index and Canada, as long as the country
does not appear on any list of prohibited or boycotted nations of the AFL-CIO or
certain other labor organizations. Nations that are presently in the EAFE Index
include Japan, the United Kingdom, Germany, France, and The Netherlands. In
addition, the Portfolio will tend to favor investment in issuers located in
those countries that the investment adviser perceives as enjoying favorable
relations with the United States. Pursuant to the Portfolio's issuer-specific
criteria, the Portfolio will (1) invest only in companies which are publicly
traded; (2) focus on companies that show, in the investment adviser's opinion,
evidence of pursuing fair labor practices; (3) focus on companies that have not
been subject to penalties or tariffs imposed by applicable U.S. Government
agencies for unfair trade practices within the previous two years; and (4) not
invest in initial public offerings. In the opinion of the Portfolio's investment
adviser, evidence of pursuing fair labor practices would include whether a
company has demonstrated patterns of non-compliance with applicable labor or
health and safety laws. The qualitative labor sensitivity factors that the
Portfolio's investment adviser will utilize in selecting securities will vary
over time, and will be solely in the adviser's discretion.
While the Portfolio is not subject to any specific geographic diversification
requirements, it will, under normal conditions, invest at least 65% of its total
assets in equity securities of issuers organized or having a majority of their
assets or deriving a majority of their operating income in at least three
different countries outside the United States, and which comply with the
parameters described above. Investments in obligations of foreign issuers
involve somewhat different investment risks than those affecting obligations of
United States issuers. The risks posed by investments in foreign countries
frequently are greater. See "ADDITIONAL INVESTMENT INFORMATION--FOREIGN
INVESTMENT INFORMATION."
The investment adviser does not normally intend to respond to short-term market
fluctuations or to acquire securities for the purpose of short-term trading;
however, the investment adviser may take advantage of short-term opportunities
that are consistent with its investment objective. It is anticipated that the
annual turnover rate of the Portfolio, under normal circumstances, will not
exceed 100%.
Currency considerations carry a special risk for a portfolio of international
securities, and the investment adviser employs a purchasing power parity
approach to evaluate currency risk. In this regard, the Portfolio may actively
carry on hedging activities, and may invest in forward foreign currency exchange
contracts to hedge currency risks associated with the purchase of individual
securities denominated in a particular currency. See "ADDITIONAL INVESTMENT
INFORMATION -- FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS."
THE REAL ESTATE INVESTMENT TRUST PORTFOLIO
The investment objective of The Real Estate Investment Trust Portfolio is to
achieve maximum long-term total return. Capital appreciation is a secondary
objective. The Portfolio seeks to achieve its objectives by investing in
securities of companies principally engaged in the real estate industry. Under
normal circumstances, at least 65% of the Portfolio's total assets will be
invested in equity securities of real estate investment trusts ("REITs") and
other real estate industry operating companies ("REOCs"). For purposes of the
Portfolio's investments, a REOC is a company that derives at least 50% of its
gross revenues or net profits from either 1) the ownership, development,
construction, financing, management or sale of commercial, industrial or
residential real estate, or 2) products or services related to the real estate
industry, such as building supplies or mortgage servicing. The Portfolio will
operate as a nondiversified fund for purposes of the 1940 Act.
The Portfolio invests primarily in equity securities of REITs and REOCs,
including, from time to time, sponsored or unsponsored American Depository
Receipts actively traded in the United States. Equity securities for this
purpose include common stocks, securities convertible into common stocks and
securities having common stock characteristics, such as rights and warrants to
purchase common stocks. The Portfolio may also purchase preferred stock. The
Portfolio may invest up to 10% of its assets in foreign securities, and in
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convertible securities. See "ADDITIONAL INVESTMENT INFORMATION--FOREIGN
INVESTMENT INFORMATION" and "CONVERTIBLE AND DEBT SECURITIES" for further
discussion of these investment policies. The Portfolio may also invest in
mortgage-backed securities. See "MORTGAGE-BACKED SECURITIES" for more detailed
information about this investment policy.
The Portfolio may hold cash or invest in short-term debt securities and other
money market instruments when, in the investment adviser's opinion, such
holdings are prudent given then prevailing market conditions. Except when the
investment adviser believes a temporary defensive approach is appropriate, the
Portfolio will not hold more than 5% of its total assets in cash or such short-
term investments. All these short-term investments will be of the highest
quality as determined by a nationally-recognized statistical rating organization
(e.g. AAA by S&P or Aaa by Moody's) or be of comparable quality as determined by
the Portfolio's investment adviser. See "ADDITIONAL INVESTMENT INFORMATION" for
further details concerning these and other investment policies.
Although the Portfolio does not invest directly in real estate, the Portfolio
does invest primarily in REITs and REOCs, and does concentrate its investments
in the real estate industry. As a consequence, an investment in the Portfolio
may be subject to certain risks associated with direct ownership of real estate
and with the real estate industry in general. These risks include, among
others: possible declines in the value of real estate; risks related to general
and local economic conditions; possible lack of availability of mortgage funds;
overbuilding; extended vacancies of properties; increases in competition;
property taxes and operating expenses; changes in zoning laws; costs resulting
from the clean-up of, and liability to third parties resulting from,
environmental problems; casualty for condemnation losses, uninsured damages from
floods, earthquakes or other natural disasters; limitations on and variations in
rents; and changes in interest rates.
The Portfolio may invest without limitation in shares of REITs. REITs are
pooled investment vehicles which invest primarily in income-producing real
estate or real estate related loans or interests. REITs are generally
classified as equity REITs, mortgage REITs or a combination of equity and
mortgage REITs. Equity REITs invest the majority of their assets directly in
real property and derive income primarily from the collection of rents. Equity
REITs can also realize capital gains by selling properties that have appreciated
in value. Mortgage REITs invest the majority of their assets in real estate
mortgages and derive income from the collection of interest payments. Like
investment companies such as the Fund, REITs are not taxed on income distributed
to shareholders provided they comply with several requirements in the Internal
Revenue Code of 1986, as amended (the "Code"). REITs are subject to substantial
cash flow dependency, defaults by borrowers, self-liquidation, and the risk of
failing to qualify for tax-free pass-through of income under the Code, and/or to
maintain exemptions from the 1940 Act. By investing in REITs indirectly through
the Portfolio, a shareholder bears not only a proportionate share of the
expenses of the Portfolio, but also, indirectly, similar expenses of the REITs.
For a further discussion of the risks presented by investing in REITs, see
"ADDITIONAL INVESTMENT INFORMATION--REITS."
While the Portfolio does not intend to invest directly in real estate, the
Portfolio could, under certain circumstances, own real estate directly as a
result of a default on securities the Portfolio owns. In addition, if the
Portfolio has rental income or income from the direct disposition of real
property, the receipt of such income may adversely affect the Portfolio's
ability to retain its tax status as a regulated investment company.
The Portfolio may also, to a limited extent, enter into futures contracts on
stocks, purchase or sell options on such futures, engage in certain options
transactions on stocks and enter into closing transactions with respect to those
activities. However, these activities will not be entered into for speculative
purposes, but rather to facilitate the ability quickly to deploy into the stock
market the Portfolio's positions in cash, short-term debt securities and other
money market instruments, at times when the Portfolio's assets are not fully
invested in equity securities. Such positions will generally be eliminated when
it becomes possible to invest in securities that are appropriate for the
Portfolio. See "ADDITIONAL INVESTMENT INFORMATION--FUTURES CONTRACTS AND
OPTIONS ON FUTURES CONTRACTS" and "OPTIONS" for a further discussion of these
investment policies.
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In connection with the Portfolio's ability to invest up to 10% of its total
assets in the securities of foreign issuers, currency considerations may present
risks if the Portfolio holds international securities. Currency considerations
carry a special risk for a portfolio of international securities. In this
regard, the Portfolio may actively carry on hedging activities, and may invest
in forward foreign currency exchange contracts to hedge currency risks
associated with the purchase of individual securities denominated in a
particular currency. See "ADDITIONAL INVESTMENT INFORMATION--FORWARD FOREIGN
CURRENCY EXCHANGE CONTRACTS."
The investment adviser does not normally intend to respond to short-term market
fluctuations or to acquire securities for the purpose of short-term trading;
however, the investment adviser may take advantage of short-term opportunities
that are consistent with its investment objective. It is anticipated that the
annual turnover rate of the Portfolio, under normal circumstances, will not
exceed 100%.
THE FIXED INCOME PORTFOLIO
The Fixed Income Portfolio's investment objective is to realize maximum long-
term total return, consistent with reasonable risk. It seeks to achieve its
objective by investing in a diversified portfolio of investment grade fixed
income obligations, including securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities ("U.S. Government securities"),
mortgage-backed securities, asset-backed securities, corporate bonds, and other
fixed income securities.
It seeks maximum long-term total return by investing in debt securities having
an average effective maturity (that is, the market value weighted average time
to repayment of principal) of between one to ten years. Short - and
intermediate- term debt securities (under ten years) form the core of the
Portfolio, with long-term bonds (over ten years) purchased as well when the
investment adviser believes they will enhance return without significantly
increasing risk. Average effective maturity may exceed the above range when the
investment adviser believes opportunities for enhanced returns exceed risk.
Typically, approximately 50% of the Portfolio's assets will be invested in U.S.
Government securities, mortgage-backed securities and asset-backed securities.
All securities purchased by the Portfolio will have an investment grade rating
at the time of purchase. Investment grade fixed income obligations will be
those rated BBB or better by S&P or Baa or better by Moody's or those deemed to
be of comparable quality by the investment adviser. Obligations rated BBB and
Baa have speculative characteristics. To the extent that the rating of a debt
obligation held by the Portfolio falls below BBB or Baa, the Portfolio, as soon
as practicable, will dispose of the security, unless such disposal would be
detrimental to the Portfolio in light of market conditions. See "ADDITIONAL
INVESTMENT INFORMATION -- U.S. GOVERNMENT SECURITIES" and "MORTGAGE-BACKED
SECURITIES" for more detailed information about these and other investment
policies.
The Portfolio will normally experience an annual portfolio turnover rate
exceeding 100%, but that rate is not expected to exceed 250%. A 100% turnover
rate would occur if all of the securities in the Portfolio were sold and
replaced within one year. The rate of portfolio turnover is not a limiting
factor when the investment adviser deems it desirable to purchase or sell
securities. High portfolio turnover (over 100%) involves correspondingly
greater brokerage commissions and other transaction costs and may affect taxes
payable by the Portfolio's shareholders that are subject to federal income
taxes. The turnover rate may also be affected by cash requirements from
redemptions and repurchases of the Portfolio's shares. The degree of Portfolio
activity may affect brokerage costs of the Portfolio and taxes payable by
institutional shareholders that are subject to federal income taxes. See
"PORTFOLIO TRANSACTIONS" and "TAXES."
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THE LIMITED-TERM MATURITY PORTFOLIO
The Limited-Term Maturity Portfolio seeks to realize a high level of current
income, consistent with the preservation of principal and reasonable risk. It
seeks to achieve its objective by investing in a diversified portfolio of
investment grade fixed income securities including: U.S. Government securities,
mortgage-backed securities, asset-backed securities, corporate bonds, and other
fixed income securities. The Portfolio will not exceed an average effective
maturity (that is, the market value weighted average time to repayment of
principal) of five years and will invest at least a majority of its assets in
U.S. Government securities and mortgage-backed securities. The Portfolio also
may hold up to 30% of its assets in investment grade corporate fixed income
obligations (other than mortgage-backed securities and U.S. Government
securities) and asset-backed securities, but may not invest more than 10% of its
assets in such investment grade corporate fixed income securities rated, at the
time of purchase, Baa by Moody's or BBB by S&P or determined to be of comparable
quality by the investment adviser. To the extent that the rating of a debt
obligation held by the Portfolio falls below BBB or Baa the Portfolio, as soon
as practicable, will dispose of the security, unless such disposal would be
detrimental to the Portfolio in light of market conditions.
The Limited-Term Maturity Portfolio will normally experience an annual portfolio
turnover rate exceeding 100%, but that rate is not expected to exceed 200%. See
"INVESTMENT OBJECTIVES, POLICIES AND RISK CONSIDERATIONS--THE FIXED INCOME
PORTFOLIO" for a discussion of the implication of a portfolio turnover rate
exceeding 100%.
THE GLOBAL FIXED INCOME PORTFOLIO
The Portfolio seeks to realize current income consistent with the preservation
of investors' principal. It seeks to achieve its objective by investing
primarily in fixed income securities that may also provide the potential for
capital appreciation. The Portfolio is a global fund. As such, it may invest
in securities issued in any currency and may hold foreign currency. Under
normal circumstances, at least 65% of the Portfolio's assets will be invested in
the fixed income securities of issuers organized or having a majority of their
assets in or deriving a majority of their operating income in at least three
different countries, one of which may be the United States. Securities of
issuers within a given country may be denominated in the currency of another
country or in multinational currency units such as the ECU. The Portfolio will
operate as a nondiversified fund for purposes of the 1940 Act.
The investment adviser's approach in selecting investments for the portfolio is
oriented to country selection and is value driven. In selecting fixed income
instruments for the Portfolio, the investment adviser identifies those
countries' fixed income markets which it believes will provide the United
States' domiciled investor the highest yield over a market cycle, while also
offering the opportunity for capital gain and currency appreciation. The
investment adviser conducts extensive fundamental research on a global basis,
and it is through this effort that attractive fixed income markets are selected
for investment. The core of the fundamental research effort is a value oriented
discounted income stream methodology which isolates value across country
boundaries. This approach focuses on future coupon and redemption payments and
discounts the value of those payments back to what they would be worth if they
were to be paid today. Comparisons of the values of different possible
investments are then made. The investment adviser's management approach is
long-term in orientation, and it is therefore expected that the annual turnover
of the portfolio will not exceed 200% under normal circumstances. See
"PORTFOLIO TRANSACTIONS" and "TAXES."
The Portfolio will attempt to achieve its objective by investing in a broad
range of fixed income securities, including debt obligations of foreign and U.S.
companies which are generally rated A or better by S&P or Moody's or, if
unrated, are deemed to be of comparable quality by Delaware International, as
well as, foreign and U.S. Government securities with the limitation noted
below. The Portfolio may invest up to 5% of its assets in fixed income
securities rated below investment grade, including foreign government securities
as discussed below. See "ADDITIONAL INVESTMENT INFORMATION--HIGH-YIELD, HIGH
RISK
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SECURITIES." The Portfolio may also invest in zero coupon bonds, and in
the debt securities of supranational entities denominated in any currency. The
Portfolio may also invest in mortgage-backed securities. See "ADDITIONAL
INVESTMENT INFORMATION--MORTGAGE-BACKED SECURITIES."
Zero coupon bonds are debt obligations which do not entitle the holder to any
periodic payments of interest prior to maturity or a specified date when the
securities begin paying current interest, and therefore are issued and traded at
a discount from their face amounts or par value. A supranational entity is an
entity established or financially supported by the national governments of one
or more countries to promote reconstruction or development. Examples of
supranational entities include, among others, the World Bank, the European
Economic Community, the European Coal and Steel Community, the European
Investment Bank, the Inter-Development Bank, the Export-Import Bank and the
Asian Development Bank. For increased safety, the Portfolio currently
anticipates that a large percentage of its assets will be invested in
U.S.Government securities and foreign government securities and securities of
supranational entities.
With respect to U.S. Government securities, the Portfolio may invest only in
securities issued or guaranteed as to the payment of principal and interest by
the U.S. Government, and those of its agencies or instrumentalities which are
backed by the full faith and credit of the United States. Direct obligations of
the U.S. Government which are available for purchase by the Portfolio include
bills, notes, bonds and other debt securities issued by the U.S. Treasury.
These obligations differ mainly in interest rates, maturities and dates of
issuance. Agencies whose obligations are backed by the full faith and credit of
the United States include the Farmers Home Administration, Federal Financing
Bank and others. When the Portfolio's investment adviser believes a temporary
defensive approach is appropriate, the Portfolio may hold up to 100% of its
assets in such U.S. Government securities and certain other short-term
instruments. See "ADDITIONAL INVESTMENT INFORMATION--U.S. GOVERNMENT
SECURITIES" and "SHORT-TERM INVESTMENTS."
With respect to securities issued by foreign governments, their agencies,
instrumentalities or political subdivisions, the Portfolio will generally invest
in such securities if they have been rated AAA or AA by S&P or Aaa or Aa by
Moody's or, if unrated, have been determined by the investment manager to be of
comparable quality. As noted above, the Portfolio may invest up to 5% of its
assets in non-investment grade fixed income securities. These investments may
include foreign government securities, some of which may be so-called Brady
Bonds. See "ADDITIONAL INFORMATION--HIGH-YIELD, HIGH RISK SECURITIES." The
Portfolio may also invest in sponsored or unsponsored American Depository
Receipts or European Depository Receipts. While the Portfolio may purchase
securities of issuers in any foreign country, developed or underdeveloped, it is
currently anticipated that the countries in which the Portfolio may invest will
include, but not be limited to, Canada, Germany, the United Kingdom, New
Zealand, France, the Netherlands, Belgium, Spain, Switzerland, Ireland, Denmark,
Portugal, Italy, Austria, Norway, Sweden, Finland, Luxembourg, Japan and
Australia. With respect to certain countries, investments by an investment
company may only be made through investments in closed-end investment companies
that in turn are authorized to invest in the securities of issuers in such
countries. Any investment the Portfolio may make in other investment companies
is limited in amount by the 1940 Act and would involve the indirect payment of a
portion of the expenses, including advisory fees, of such other investment
companies. See "ADDITIONAL INVESTMENT INFORMATION--FOREIGN INVESTMENT
INFORMATION."
Currency considerations carry a special risk for a portfolio of international
securities and the investment adviser employs a purchasing power parity approach
to evaluate currency risk. In this regard, the Portfolio will actively carry on
hedging activities, and may invest in forward foreign currency exchange
contracts to hedge currency risks associated with its portfolio of securities.
See "ADDITIONAL INVESTMENT INFORMATION --FORWARD FOREIGN CURRENCY EXCHANGE
CONTRACTS."
It is anticipated that the average weighted maturity of the Portfolio will be in
the five-to-ten year range. If, however, the investment adviser anticipates a
declining interest rate environment, the average weighted maturity may be
extended beyond ten years. Conversely, if the investment adviser anticipates a
rising rate environment, the average weighted maturity may be shortened to less
than five years. The Portfolio will not invest 25% or
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more of its total assets in the securities of issuers all of which conduct their
principal business activities in the same industry.
THE INTERNATIONAL FIXED INCOME PORTFOLIO
The Portfolio seeks to realize current income consistent with the preservation
of investors' principal. It seeks to achieve its objective by investing
primarily in fixed income securities that may also provide the potential for
capital appreciation. The Portfolio is an international fund. As such, it may
invest in securities issued in any currency and may hold foreign currency.
Under normal circumstances, at least 65% of the Portfolio's assets will be
invested in the fixed income securities of issuers organized or having a
majority of their assets in or deriving a majority of their operating income in
at least three different countries outside of the United States. Under normal
circumstances, the Portfolio intends to invest in securities which are
denominated in foreign currencies. Securities of issuers within a given country
may be denominated in the currency of another country or in multinational
currency units such as ECU. The Portfolio will operate as a nondiversified fund
for purposes of the 1940 Act.
The investment adviser's approach in selecting investments for the portfolio is
oriented to country selection and is value driven. In selecting fixed income
instruments for the Portfolio, the investment adviser identifies those
countries' fixed income markets which it believes will provide the United States
domiciled investor the highest yield over a market cycle, while also offering
the opportunity for capital gain and currency appreciation. The investment
adviser conducts extensive fundamental research on a global basis, and it is
through this effort that attractive fixed income markets are selected for
investment. The core of the fundamental research effort is a value oriented
discounted income stream methodology which isolates value across country
boundaries. This approach focuses on future coupon and redemption payments and
discounts the value of those payments back to what they would be worth if they
were to be paid today. Comparisons of the values of different possible
investments are then made. The investment adviser's management approach is
long-term in orientation, but, it is expected that the annual turnover of the
portfolio will be approximately 200% under normal circumstances. See "PORTFOLIO
TRANSACTIONS" and "TAXES."
The Portfolio will attempt to achieve its objective by investing in a broad
range of fixed income securities, including debt obligations of foreign
companies which are generally rated A or better by S&P or Moody's or, if
unrated, are deemed to be of comparable quality by Delaware International, as
well as, foreign government securities with the limitation noted below. The
Portfolio may invest up to 5% of its assets in fixed income securities rated
below investment grade, including foreign government securities as discussed
below. See "ADDITIONAL INVESTMENT INFORMATION--HIGH-YIELD, HIGH RISK
SECURITIES." The Portfolio may also invest in zero coupon bonds, and in the
debt securities of supranational entities denominated in any currency.
Zero coupon bonds are debt obligations which do not entitle the holder to any
periodic payments of interest prior to maturity or a specified date when the
securities begin paying current interest, and therefore are issued and traded at
a discount from their face amounts or par value. A supranational entity is an
entity established or financially supported by the national governments of one
or more countries to promote reconstruction or development. Examples of
supranational entities include, among others, the World Bank, the European
Economic Community, the European Coal and Steel Community, the European
Investment Bank, the Inter-Development Bank, the Export-Import Bank and the
Asian Development Bank. For increased safety, the Portfolio currently
anticipates that a large percentage of its assets will be invested in foreign
government securities and securities of supranational entities.
With respect to U.S. Government securities, the Portfolio may invest only in
securities issued or guaranteed as to the payment of principal and interest by
the U.S. Government, and those of its agencies or instrumentalities which are
backed by the full faith and credit of the United States. Direct obligations of
the U.S. Government which are available for purchase by the Portfolio include
bills, notes, bonds and other debt
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<PAGE>
securities issued by the U.S. Treasury. These obligations differ mainly in
interest rates, maturities and dates of issuance. Agencies whose obligations are
backed by the full faith and credit of the United States include the Farmers
Home Administration, Federal Financing Bank and others. When the Portfolio's
investment adviser believes a temporary defensive approach is appropriate, the
Portfolio may hold up to 100% of its assets in such U.S. Government securities
and certain other short-term instruments. See "ADDITIONAL INVESTMENT
INFORMATION--U.S. GOVERNMENT SECURITIES" and"SHORT-TERM INVESTMENTS."
With respect to securities issued by foreign governments, their agencies,
instrumentalities or political subdivisions, the Portfolio will generally invest
in such securities if they have been rated AAA or AA by S&P or Aaa or Aa by
Moody's or, if unrated, have been determined by the investment manager to be of
comparable quality. As noted above, the Portfolio may invest up to 5% of its
assets in non-investment grade fixed income securities. These investments may
include foreign government securities, some of which may be so-called Brady
Bonds. See "ADDITIONAL INFORMATION--HIGH-YIELD, HIGH RISK SECURITIES." The
Portfolio may also invest in sponsored or unsponsored American Depository
Receipts or European Depository Receipts. While the Portfolio may purchase
securities of issuers in any foreign country, developed or underdeveloped, it is
currently anticipated that the countries in which the Portfolio may invest will
include, but not be limited to, Canada, Germany, the United Kingdom, New
Zealand, France, the Netherlands, Belgium, Spain, Switzerland, Ireland, Denmark,
Portugal, Italy, Austria, Norway, Sweden, Finland, Luxembourg, Japan and
Australia. With respect to certain countries, investments by an investment
company may only be made through investments in closed-end investment companies
that in turn are authorized to invest in the securities of issuers in such
countries. Any investment the Portfolio may make in other investment companies
is limited in amount by the 1940 Act and would involve the indirect payment of a
portion of the expenses, including advisory fees, of such other investment
companies. See "ADDITIONAL INVESTMENT INFORMATION--FOREIGN INVESTMENT
INFORMATION."
Currency considerations carry a special risk for a portfolio of international
securities and the investment adviser employs a purchasing power parity approach
to evaluate currency risk. In this regard, the Portfolio will actively carry on
hedging activities, and may utilize a wide range of hedging instruments,
including options, futures contracts, and related options, and forward foreign
currency exchange contracts to hedge currency risks associated with its
portfolios of securities. See "ADDITIONAL INVESTMENT INFORMATION--FORWARD
FOREIGN CURRENCY EXCHANGE CONTRACTS, FUTURES CONTRACTS AND OPTIONS ON FUTURES
CONTRACTS," and"OPTIONS."
It is anticipated that the average weighted maturity of the Portfolio will be in
the five-to-ten year range. If, however, the investment adviser anticipates a
declining interest rate environment, the average weighted maturity may be
extended beyond ten years. Conversely, if the investment adviser anticipates a
rising rate environment, the average weighted maturity may be shortened to less
than five years. The Portfolio will not invest 25% or more of its total assets
in the securities of issuers all of which conduct their principal business
activities in the same industry.
THE HIGH-YIELD BOND PORTFOLIO
The High-Yield Bond Portfolio's investment objective is to seek high total
return. The Portfolio seeks to achieve its objective by investing primarily in
bonds rated CCC or higher by S&P or Caa or higher by Moody's or, if unrated,
judged to be of comparable quality by the investment adviser. The Portfolio
pursues a strategy to invest primarily in those securities that have a liberal
and consistent yield and those tending to reduce the risk of market
fluctuations.
The Portfolio will invest at least 80% of its assets at the time of purchase in:
1) corporate bonds that may be rated or unrated, the latter of which may be more
speculative in nature than rated bonds; or 2) securities issued or guaranteed by
the U.S Government, its agencies or instrumentalities; or 3) commercial paper of
companies rated A-1 or A-2 by S&P or rated P-1 or P-2 by Moody's or, if unrated,
judged to be of comparable quality
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by the investment adviser. The Portfolio may also invest in income-producing
securities, including common stocks and preferred stocks, some of which may have
convertible features or attached warrants and which may be speculative. See
"ADDITIONAL INVESTMENT INFORMATION--CONVERTIBLE AND DEBT SECURITIES" for a
further discussion of these investment policies. The Portfolio may invest up to
10% of its total assets in securities of issuers domiciled in foreign countries.
The Portfolio may hold cash or invest in short-term debt securities and other
money market instruments when, in the investment adviser's opinion, such
holdings are prudent given then prevailing market conditions. Except when the
investment adviser believes a temporary defensive approach is appropriate, the
Portfolio normally will not hold more than 5% of its total assets in cash or
such short-term investments. All these short-term investments will be of the
highest quality as determined by a nationally-recognized statistical rating
organization (e.g., AAA by S&P or Aaa by Moody's) or, if unrated, judged to be
of comparable quality as determined by the investment adviser. See "ADDITIONAL
INVESTMENT INFORMATION" for further details concerning these and other
investment policies.
Although the Portfolio does not generally purchase a substantial amount of zero
coupon bonds or pay-in-kind (PIK) bonds, from time to time, the Portfolio may
acquire zero coupon bonds and, to a lesser extent, PIK bonds. Zero coupon bonds
and PIK bonds are generally considered to be more interest-sensitive than income
bearing bonds, to be more speculative than interest-bearing bonds, and to have
certain tax consequences which could, under certain circumstances, be adverse to
the Portfolio. For example, the Portfolio accrues, and is required to
distribute to shareholders income on its zero coupon bonds. However, the
Portfolio may not receive the cash associated with this income until the bonds
are sold or mature. If the Portfolio did not have sufficient cash to make the
required distribution of accrued income, the Portfolio could be required to sell
other securities in its portfolio or to borrow to generate the cash required.
With respect to U.S. Government securities, the Portfolio may invest only in
securities issued or guaranteed as to the payment of principal and interest by
the U.S. Government, and those of its agencies or instrumentalities which are
backed by the full faith and credit of the United States. Direct obligations of
the U.S. Government which are available for purchase by the Portfolio include
bills, notes, bonds and other debt securities issued by the U.S. Treasury.
These obligations differ mainly in interest rates, maturities and dates of
issuance. Agencies whose obligations are backed by the full faith and credit of
the United States include the Farmers Home Administration, Federal Financing
Bank and others. See "ADDITIONAL INVESTMENT INFORMATION--U.S. GOVERNMENT
SECURITIES."
The investment adviser does not normally intend to respond to short-term market
fluctuations or to acquire securities for the purpose of short-term trading;
however, the investment adviser may take advantage of short-term opportunities
that are consistent with its investment objective. It is anticipated that the
annual turnover rate of the Portfolio, under normal circumstances, will not
exceed 100%.
It is anticipated that the Portfolio's assets will be invested primarily in
unrated corporate bonds and bonds rated CCC or higher by S&P or Caa or higher by
Moody's, or, if unrated, judged to be of comparable quality by the investment
adviser. The market values of fixed income securities generally fall when
interest rates rise and, conversely, rise when interest rates fall. Lower rated
and unrated fixed income securities tend to reflect short-term corporate and
market developments to a greater extent than higher rated fixed income
securities, which react primarily to fluctuations in the general level of
interest rates. These lower rated or unrated securities generally have higher
yields, but, as a result of factors such as reduced creditworthiness of issuers,
increased risks of default and a more limited and less liquid secondary market,
are subject to greater volatility and risks of loss of income and principal than
are higher rated securities. The investment adviser will attempt to reduce such
risks through portfolio diversification, credit analysis, and attention to
trends in the economy, industries and financial markets.
Investing in these so-called "junk" or "high-yield" 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 Portfolio. Such bonds are sometimes issued
by
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<PAGE>
companies whose earnings at the time of issuance are less than the projected
debt service on the junk bonds. Some of the principal risks to which junk bonds
are subject are discussed below.
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 the 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 the
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 Portfolio's net asset value.
In addition, if, as a result of volatility in the high-yield market or other
factors, the Portfolio experiences substantial net redemptions of the
Portfolio's shares for a sustained period of time, the Portfolio may be required
to sell securities without regard to the investment merits of the securities to
be sold. If the Portfolio sells a substantial number of securities to generate
proceeds for redemptions, the asset base of the Portfolio will decrease and the
Portfolio's expense ratios may increase.
Furthermore, 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
Portfolio's ability to dispose of particular issues, when necessary, to meet the
Portfolio'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 Portfolio 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 Portfolio's privately placed
high-yield securities are particularly susceptible to the liquidity and
valuation risks outlined above.
Finally, 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 purchase 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 and could make it more difficult for the Portfolio to attain its
investment objective.
See "ADDITIONAL INVESTMENT INFORMATION--HIGH-YIELD, HIGH RISK SECURITIES" for
further information about high-yield securities.
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PURCHASE OF SHARES
Shares of each Portfolio may be purchased without a sales commission, at net
asset value per share next determined after (i) the Fund has been notified by
telephone of your purchase order and (ii) Federal Funds have been delivered to
the Fund's bank account maintained with The Morgan Guaranty Trust Company of New
York ("Custodian Bank"). Shares of The International Equity Portfolio and The
Labor Select International Equity Portfolio may, under certain circumstances, be
required to be purchased in-kind, as noted below. At such time as the Fund
receives appropriate regulatory approval to do so in the future, under certain
circumstances, the Fund may, at its sole discretion, allow institutional
investors who have an investment counseling relationship with Delaware
Investment Advisers or Delaware International to make investments in the
Portfolios by a contribution of securities in-kind to such Portfolios. See
"VALUATION OF SHARES."
The minimum initial investment for a Portfolio is $1,000,000.
By Federal Funds Wire
Purchases of shares of a Portfolio may only be made by having your bank wire
Federal Funds to the Fund's bank account maintained with the Custodian Bank. In
order for share purchases to be priced at the end of a given business day, the
Fund must be notified by telephone and Federal Funds must be received no later
than the close of regular trading on the New York Stock Exchange ("NYSE")
(ordinarily, 4 p.m., Eastern time) on days when the exchange is open. If notice
is given or Federal Funds are delivered after that time, the purchase order will
be priced on the following business day. In order to ensure prompt receipt of
your Federal Funds Wire and processing of your purchase order, it is important
that the following steps be taken:
1. Telephone the Fund (Toll Free: 1-800-231-8002) and provide us with the
account name, address, telephone number, Tax Identification Number, the
Portfolio(s) selected, the amount being wired and by which bank and which
specific branch, if applicable. We will provide you with a Fund account number.
2. Instruct your bank to wire the specified amount of Federal Funds to the
Fund's Wire Concentration Bank Account (be sure to have your bank include the
name of the Portfolio(s) selected and the account number assigned to you) at:
The Morgan Guaranty Trust Company of New York
New York, NY 10015
ABA #021000238
DDA #001-30-970 (The Defensive Equity Portfolio)
DDA #001-30-981 (The Aggressive Growth Portfolio)
DDA #001-30-992 (The International Equity Portfolio)
DDA #001-00-000 (The Defensive Equity Small/Mid-Cap Portfolio)
DDA #001-00-000 (The Defensive Equity Utility Portfolio)
DDA #001-00-000 (The Labor Select International Equity Portfolio)
DDA #001-00-000 (The Real Estate Investment Trust Portfolio)
DDA #001-31-003 (The Fixed Income Portfolio)
DDA #001-31-014 (The Limited-Term Maturity Portfolio)
DDA #001-49-527 (The Global Fixed Income Portfolio)
DDA #001-63-453 (The International Fixed Income Portfolio)
DDA #001-00-000 (The High-Yield Bond Portfolio)
Attn: Delaware Pooled Trust, Inc.
Ref: (Portfolio name, your account number, your account name)
Federal Funds purchase orders will be accepted only on a day on which the Fund,
the NYSE and the Custodian Bank are open for business.
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3. Complete the Account Registration Form within two days and mail it to:
Delaware Pooled Trust, Inc.
One Commerce Square
2005 Market Street
Philadelphia, PA 19103
Attn: Client Services
In-Kind Purchases or Similar Procedures (The International Equity Portfolio and
The Labor Select International Equity Portfolio)
Institutions proposing to invest an amount which at the time they telephone the
Fund (as required above), would constitute 5% or more of the assets of The
International Equity Portfolio and The Labor Select International Equity
Portfolio will, under normal circumstances, be required to make purchases by
tendering securities in which the respective Portfolio otherwise would invest
or, by following another procedure that will have the same economic effect as an
in-kind purchase. In either case, an investor that is required to purchase
shares pursuant to those procedures will be required to pay the brokerage or
other transaction costs of acquiring the subject securities. Prospective
investors will be notified when they telephone the Fund whether their investment
must be made in-kind or by such other procedure and, if in-kind, what securities
must be tendered. The purchase price per share for such investors shall be the
net asset value next determined after, as the case may be, (1) delivery of cash
or securities to the Custodian Bank and/or (2) the assignment to the respective
Portfolio by a prospective purchaser on trade date of the investor's right to
delivery of securities as to which brokerage orders have been placed (but, as to
which settlement is yet to occur) and delivery of cash in an amount necessary to
pay for those securities on settlement date. The assets provided to the
Portfolio pursuant to these procedures shall be valued consistent with the same
valuation procedures used to calculate the Portfolio's net asset value. See
"VALUATION OF SHARES." Such investors should contact the Fund at (1-800-231-
8002) for further information.
ADDITIONAL INVESTMENTS
You may add to your shareholder account at any time and in any amount.
Procedures are the same as those to be followed for a new account, in as much as
it is very important to notify the Fund of your impending purchase by first
calling the Fund (1-800-231-8002). Then you must be sure that your bank follows
the same procedures as described above with respect to the wiring of Federal
Funds to the Fund's Custodian Bank. Additional investments in The International
Equity Portfolio and The Labor Select International Equity Portfolio are subject
to the same procedures and requirements (including the in-kind or similar
procedures) set forth above.
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REDEMPTION OF SHARES
You may withdraw all or any portion of the amount in your account by redeeming
shares at any time. The Fund will redeem shares of each Portfolio at its net
asset value next determined after receipt of your redemption request in
accordance with the following instructions. On days that the Fund, the NYSE and
the Custodian Bank are open for business, the net asset value of the Fund's
Portfolios are determined as of the close of regular trading of the NYSE
(ordinarily, 4 p.m., Eastern time). See "VALUATION OF SHARES."
Shares of the Fund may be redeemed by mail, FAX message, or telephone. No
charge is made for redemption. The proceeds of any redemption may be more or
less than the purchase price of your shares depending on the market value of the
investment securities held by the Portfolio. Shares of The International Equity
Portfolio, The Labor Select International Equity Portfolio, The Global Fixed
Income Portfolio and The International Fixed Income Portfolio may, under certain
circumstances, be required to be redeemed in-kind in portfolio securities, as
noted below.
By Mail or FAX Message
Each Portfolio will redeem its shares at the net asset value next determined on
the date the request is received in "good order." Your request should be
addressed to:
Delaware Pooled Trust, Inc.
Attn: Client Services
One Commerce Square
2005 Market Street
Philadelphia, PA 19103
FAX # 215-972-8864
"Good order" for purposes of mail or FAX message redemptions means that the
request to redeem must include the following documentation:
a. A letter of instruction specifying the number of shares or dollar amount to
be redeemed signed by the appropriate corporate or organizational officer(s)
exactly as it appears on the Account Registration Form.
b. If you wish to change the name of the commercial bank or account designation
to receive the redemption proceeds as provided in the Account Registration Form,
then a separate written request must be submitted to the Fund at the above
address and copies of this request sent to both the current commercial bank and
the new designee bank. Prior to redemption, the Fund will telephonically
confirm the change with both the current and the new designee banks. Further
clarification of these procedures can be obtained by calling the Fund.
By Telephone
If you have previously elected the Telephone Redemption Option on the Account
Registration Form, you can request a redemption of your shares by calling the
Fund and requesting the redemption proceeds be wired to the commercial bank or
account designation identified in the Account Registration Form. Shares cannot
be redeemed by telephone if stock certificates are held for those shares or, in
the case of The International Equity Portfolio, The Labor Select International
Equity Portfolio, The Global Fixed Income Portfolio or The International Fixed
Income Portfolio, in instances when the special in-kind redemption procedures
are triggered, as described below. Please contact the Fund for further details.
In times of drastic market conditions, the telephone redemption option may be
difficult to implement. If you experience difficulty in making a telephone
redemption, your request may be made by mail or FAX message, pursuant to the
procedures described above. It will be implemented at the net asset value next
determined after it is received. Neither the Fund, the Portfolios nor the
Fund's transfer agent, Delaware Service Company, Inc., is responsible for any
losses incurred in acting upon written or telephone instructions for redemption
or exchange of Portfolio shares which are
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reasonably believed to be genuine. With respect to such telephone transactions,
the Fund will ensure that reasonable procedures are used 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 Delaware
Service Company, Inc. may be liable for any losses due to unauthorized or
fraudulent transactions. A written confirmation will be provided for all
purchase, exchange and redemption transactions initiated by telephone.
To change the name of the commercial bank or account designated to receive the
redemption proceeds, a written request must be sent to the Fund at the address
above. Requests to change the bank or account designation must be signed by the
appropriate person(s) authorized to act on behalf of the shareholder.
The Fund's telephone redemption privileges and procedures may be modified or
terminated by the Fund only upon written notice to the Fund's client
shareholders.
Redemptions In-Kind or Similar Procedures (The International Equity, The Labor
Select International Equity, The Global Fixed Income and The International Fixed
Income Portfolios)
Institutions proposing to redeem an amount which, at the time they notify the
Fund of their intention to redeem (as described below), would constitute 5% or
more of the assets of The International Equity Portfolio, The Labor Select
International Equity Portfolio, The Global Fixed Income Portfolio or The
International Fixed Income Portfolio will, under normal circumstances, be
required to accept their redemption proceeds in-kind in Portfolio securities,
unless they elect another procedure which will have the same economic effect as
an in-kind redemption. In either case, an investor that is required to redeem
shares pursuant to this election must bear the brokerage or other transaction
costs of selling the Portfolio securities representing the value of their
redeemed shares. Any Portfolio securities delivered upon redemption will be
valued as described in "VALUATION OF SHARES." Investors in these Portfolios
should contact the Fund at (1-800-231-8002) for further information.
Institutional investors who have an existing investment counseling relationship
with Delaware Investment Advisers or Delaware International will not be subject
to the Fund's in-kind redemption requirements until such time as the Fund
receives appropriate regulatory approvals to permit such redemptions for the
account of such institutional investors.
IMPORTANT REDEMPTION INFORMATION
Because the Fund's shares are sold to institutional investors with a relatively
high investment minimum, Fund shareholders likely will hold a significant number
of Fund shares. For this reason, the Fund requests that shareholders proposing
to make a large redemption order give the Fund at least ten days advanced notice
of any such order. This request can easily be satisfied by calling the Fund at
(1-800-231-8002), and giving notification of your future intentions. Once a
formal redemption order is received, the Fund, in the case of redemptions to be
made in cash, normally will make payment for all shares redeemed under this
procedure within three business days of receipt of the order. In no event,
however, will payment be made more than seven days after receipt of a redemption
request in good order. The Fund may suspend the right of redemption or postpone
the date at times when the NYSE is closed, or under any emergency circumstances
as determined by the Securities and Exchange Commission ("Commission").
With respect to The International Equity, The Labor Select International Equity,
The Global Fixed Income and The International Fixed Income Portfolios, as noted
above, or if the Fund otherwise determines that it would be detrimental to the
best interests of the remaining shareholders of a Portfolio to make payment
wholly or partly in cash, the Fund may pay the redemption proceeds in whole or
in part by a distribution in-kind of securities held by a Portfolio in lieu of
cash in conformity with applicable rules of the Commission. Investors may incur
brokerage charges on the sale of Portfolio securities so received in payment of
redemptions.
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Due to the relatively high cost of maintaining shareholder accounts, the Fund
reserves the right to redeem shares in a Portfolio if the value of your holdings
in that Portfolio is below $500,000. The Fund, however, will not redeem shares
based solely upon market reductions in net asset value. If the Fund intends to
take such action, a shareholder would be notified and given 90 days to make an
additional investment before the redemption is processed.
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ADDITIONAL INVESTMENT INFORMATION
U.S. GOVERNMENT SECURITIES
The U.S. Government securities in which the various Portfolios may invest for
temporary purposes and otherwise (see "INVESTMENT OBJECTIVES, POLICIES AND RISK
CONSIDERATIONS"), include a variety of securities which are issued or guaranteed
as to the payment of principal and interest by the U.S. Government , and by
various agencies or instrumentalities which have been established or sponsored
by the U.S. Government.
U.S. Treasury securities are backed by the "full faith and credit" of the United
States. Securities issued or guaranteed by federal agencies and U.S. Government
sponsored instrumentalities may or may not be backed by the full faith and
credit of the United States. In the case of securities not backed by the full
faith and credit of the United States, investors in such securities look
principally to the agency or instrumentality issuing or guaranteeing the
obligation for ultimate repayment, and may not be able to assert a claim against
the United States itself in the event the agency or instrumentality does not
meet its commitment. Agencies which are backed by the full faith and credit of
the United States include the Export-Import Bank, Farmers Home Administration,
Federal Financing Bank, and others. Certain agencies and instrumentalities,
such as the Government National Mortgage Association ("GNMA"), are, in effect,
backed by the full faith and credit of the United States through provisions in
their charters that they may make "indefinite and unlimited" drawings on the
Treasury, if needed to service its debt. Debt from certain other agencies and
instrumentalities, including the Federal Home Loan Bank and Federal National
Mortgage Association, are not guaranteed by the United States, but those
institutions are protected by the discretionary authority for the U.S. Treasury
to purchase certain amounts of their securities to assist the institutions in
meeting their debt obligations. Finally, other agencies and instrumentalities,
such as the Farm Credit System and the Federal Home Loan Mortgage Corporation,
are federally chartered institutions under U.S. Government supervision, but
their debt securities are backed only by the creditworthiness of those
institutions, not the U.S. Government.
Some of the U.S. Government agencies that issue or guarantee securities include
the Export-Import Bank of the United States, Farmers Home Administration,
Federal Housing Administration, Maritime Administration, Small Business
Administration, and the Tennessee Valley Authority.
An instrumentality of a U.S. Government agency is a government agency organized
under Federal charter with government supervision. Instrumentalities issuing or
guaranteeing securities include, among others, Federal Home Loan Banks, the
Federal Land Banks, Central Bank for Cooperatives, Federal Immediate Credit
Banks, and the Federal National Mortgage Association.
MORTGAGE-BACKED SECURITIES
The Real Estate Investment Trust, The Fixed Income, The Limited-Term Maturity
and The Global Fixed Income Portfolios may invest in mortgage-backed securities
issued or guaranteed by the U.S. Government, its agencies or instrumentalities
or by government sponsored corporations. Those securities include, but are not
limited to, GNMA certificates. Such securities differ from other fixed income
securities in that principal is paid back by the borrower over the length of the
loan rather than returned in a lump sum at maturity. When prevailing interest
rates rise, the value of a GNMA security may decrease as do other debt
securities. When prevailing interest rates decline, however, the value of GNMA
securities may not rise on a comparable basis with other debt securities because
of the prepayment feature of GNMA securities. Additionally, if a GNMA
certificate is purchased at a premium above its principal value because its
fixed rate of interest exceeds the prevailing level of yields, the decline in
price to par may result in a loss of the premium in the event of prepayment.
Funds received from prepayments may be reinvested at the prevailing interest
rates which may be lower than the rate of interest that had previously been
earned.
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<PAGE>
The Portfolios also may invest in collateralized mortgage obligations ("CMOs")
and real estate mortgage investment conduits ("REMICs"). CMOs are debt
securities issued by U.S. Government agencies or by financial institutions and
other mortgage lenders and collateralized by a pool of mortgages held under an
indenture. CMOs are issued in a number of classes or series with different
maturities. The classes or series are retired in sequence as the underlying
mortgages are repaid. REMICs, which were authorized under the Tax Reform Act of
1986, are private entities formed for the purpose of holding a fixed pool of
mortgages secured by an interest in real property. REMICs are similar to CMOs
in that they issue multiple classes of securities. To the extent any privately-
issued CMOs or REMICs in which the Portfolios may invest are considered by the
Commission to be investment companies, the Portfolios will limit their
investments in such securities in a manner consistent with the provisions of the
1940 Act.
The mortgages backing these securities include conventional 30-year fixed rate
mortgages, graduated payment mortgages and adjustable rate mortgages. These
mortgages may be supported by various types of insurance, may be backed by GNMA
certificates or other mortgage pass-throughs issued or guaranteed by the U.S.
Government, its agencies or instrumentalities. However, the guarantees do not
extend to the mortgage-backed securities' value, which is likely to vary
inversely with fluctuations in interest rates. These certificates are in most
cases "pass-through" instruments, through which the holder receives a share of
all interest and principal payments from the mortgages underlying the
certificate. Because the prepayment characteristics of the underlying mortgages
vary, it is not possible to predict accurately the average life or realized
yield of a particular issue of pass-through certificates. During periods of
declining interest rates, prepayment of mortgages underlying mortgage-backed
securities can be expected to accelerate. When the mortgage obligations are
prepaid, the Portfolio may reinvest the prepaid amounts in securities, the yield
of which reflects interest rates prevailing at the time. Moreover, prepayments
of mortgages which underlie securities purchased at a premium could result in
capital losses.
Certain CMOs and REMICs may have variable or floating interest rates and others
may be stripped. Stripped mortgage securities have greater market volatility
than other types of mortgage securities in which the Portfolios may invest.
Stripped mortgage securities are usually structured with two classes that
receive different proportions of the interest and principal distributions on a
pool of mortgage assets. A common type of stripped mortgage security will have
one class receiving some of the interest and most of the principal from the
mortgage assets, while the other class will receive most of the interest and the
remainder of the principal. In the most extreme case, one class will receive
all of the interest (the "interest-only" class), while the other class will
receive all of the principal (the "principal-only" class). The yield to
maturity on an interest-only class is extremely sensitive not only to changes in
prevailing interest rates but also to the rate of principal payments (including
prepayments) on the related underlying mortgage assets, and a rapid rate of
principal payments may have a material adverse effect on a Portfolio's yield to
maturity. If the underlying mortgage assets experience greater than anticipated
prepayments of principal, a Portfolio may fail to fully recoup its initial
investment in these securities even if the securities are rated in the highest
rating categories.
Although stripped mortgage securities are purchased and sold by institutional
investors through several investment banking firms acting as brokers or dealers,
these securities were only recently developed. As a result, established trading
markets have not yet been fully developed and, accordingly, these securities are
generally illiquid and to such extent, together with any other illiquid
investments, will not exceed 10% of a Portfolio's net assets.
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<PAGE>
CMOs and REMICs issued by private entities are not government securities and are
not directly guaranteed by any government agency. They are secured by the
underlying collateral of the private issuer. The Portfolios will invest in such
private-backed securities only if they are 100% collateralized at the time of
issuance by securities issued or guaranteed by the U.S. Government, its agencies
or instrumentalities. The Portfolios currently invest in privately-issued CMOs
and REMICs only if they are rated at the time of purchase in the two highest
grades by a nationally-recognized statistical rating agency.
ASSET-BACKED SECURITIES
The Fixed Income and Limited-Term Maturity Portfolios may also invest in
securities which are backed by assets such as receivables on home equity and
credit card loans, and receivables regarding automobile, mobile home and
recreational vehicle loans, wholesale dealer floor plans and leases. All such
securities must be rated in the highest rating category by a reputable credit
rating agency (e.g., AAA by S&P or Aaa by Moody's). Such receivables are
securitized in either a pass-through or a pay-through structure. Pass-through
securities provide investors with an income stream consisting of both principal
and interest payments in respect of the receivables in the underlying pool.
Pay-through asset-backed securities are debt obligations issued usually by a
special purpose entity, which are collateralized by the various receivables and
in which the payments on the underlying receivables provide the funds to pay the
debt service on the debt obligations issued. The Portfolios may invest in these
and other types of asset-backed securities that may be developed in the future.
It is the Portfolios' current policy to limit asset-backed investments to those
represented by interests in credit card receivables, wholesale dealer floor
plans, home equity loans and automobile loans.
The rate of principal payment on asset-backed securities generally depends upon
the rate of principal payments received on the underlying assets. Such rate of
payments may be affected by economic and various other factors such as changes
in interest rates. Therefore, the yield may be difficult to predict and actual
yield to maturity may be more or less than the anticipated yield to maturity.
Due to the shorter maturity of the collateral backing such securities, there is
less of a risk of substantial prepayment than with mortgage-backed securities.
See "MORTGAGE-BACKED SECURITIES" above. Such asset-backed securities do,
however, involve certain risks not associated with mortgage-backed securities,
including the risk that security interests cannot be adequately or in many
cases, ever, established. In addition, with respect to credit card receivables,
a number of state and federal consumer credit laws give debtors the right to set
off certain amounts owed on the credit cards, thereby reducing the outstanding
balance. In the case of automobile receivables, there is a risk that the
holders may not have either a proper or first security interest in all of the
obligations backing such receivables due to the large number of vehicles
involved in a typical issuance and technical requirements under state laws.
Therefore, recoveries on repossessed collateral may not always be available to
support payments on the securities.
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SHORT-TERM INVESTMENTS
The short-term investments in which The Defensive Equity, The Aggressive Growth,
The International Equity,The Defensive Equity Small/Mid-Cap, The Defensive
Equity Utility, The Labor Select International Equity, The Real Estate
Investment Trust, The Global Fixed Income, The International Fixed Income and
The High-Yield Bond Portfolios may invest consistent with the limits recited
above (see "INVESTMENT OBJECTIVES, POLICIES AND RISK CONSIDERATIONS") are:
(1) Time deposits, certificates of deposit (including marketable variable rate
certificates of deposit) and bankers' acceptances issued by a U.S.
commercial bank. Time deposits are non-negotiable deposits maintained in a
banking institution for a specified period of time at a stated interest
rate. Time deposits maturing in more than seven days will not be purchased
by a Portfolio, and time deposits maturing from two business days through
seven calendar days will not exceed 10% of the total assets of a Portfolio.
Certificates of deposit are negotiable short-term obligations issued by
commercial banks against funds deposited in the issuing institution.
Variable rate certificates of deposit are certificates of deposit on which
the interest rate is periodically adjusted prior to their stated maturity
based upon a specified market rate. A bankers' acceptance is a time draft
drawn on a commercial bank by a borrower usually in connection with an
international commercial transaction (to finance the import, export,
transfer or storage of goods).
A Portfolio will not invest in any security issued by a commercial bank unless
(i) the bank has total assets of at least $1 billion or, in the case of a bank
which does not have total assets of at least $1 billion, the aggregate
investment made in any one such bank is limited to $100,000 and the principal
amount of such investment is insured in full by the Federal Deposit Insurance
Corporation, (ii) it is a member of the Federal Deposit Insurance Corporation,
and (iii) the bank or its securities have received the highest quality rating by
a nationally-recognized statistical rating organization;
(2) Commercial paper with the highest quality rating by a nationally-recognized
statistical rating organization (e.g., A-1 by S&P or Prime-1 by Moody's)
or, if not so rated, of comparable quality as determined by a Portfolio's
investment adviser;
(3) Short-term corporate obligations with the highest quality rating by a
nationally-recognized statistical rating organization (e.g., AAA by S&P or
Aaa by Moody's) or, if not so rated, of comparable quality as determined by
a Portfolio's investment adviser;
(4) U.S. Government securities (see "U.S. GOVERNMENT SECURITIES"); and
(5) Repurchase agreements collateralized by securities listed above.
WHEN-ISSUED AND DELAYED DELIVERY SECURITIES
Each Portfolio of the Fund may purchase securities on a when-issued or delayed
delivery basis. In such transactions, instruments are purchased with payment
and delivery taking place in the future in order to secure what is considered to
be an advantageous yield or price at the time of the transaction. Delivery of
and payment for these securities may take as long as a month or more after the
date of the purchase commitment.
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Each Portfolio will maintain with the Custodian Bank a separate account with a
segregated portfolio of securities in an amount at least equal to these
commitments. The payment obligation and the interest rates that will be
received are each fixed at the time a Portfolio enters into the commitment and
no interest accrues to the Portfolio until settlement. Thus, it is possible
that the market value at the time of settlement could be higher or lower than
the purchase price if the general level of interest rates has changed. It is a
current policy of the Portfolios not to enter into when-issued commitments
exceeding in the aggregate 15% of the market value of the Portfolio's total
assets less liabilities other than the obligations created by these commitments.
REPURCHASE AGREEMENTS
Each Portfolio may enter into repurchase agreements with brokers, dealers or
banks deemed to be creditworthy by a Portfolio's investment adviser under
guidelines of the Fund's directors. In a repurchase agreement, a Portfolio buys
securities from a seller that has agreed to repurchase it at a mutually agreed
upon date and price, reflecting the interest rate effective for the term of the
agreement. The term of these agreements is usually from overnight to one week
and never exceeds one year. Not more than 10% of a Portfolio's assets may be
invested in repurchase agreements having a maturity in excess of seven days.
Repurchase agreements may be viewed as a fully collateralized loan of money by a
Portfolio to the seller. The Portfolio always receives securities as collateral
with a market value at least equal to the purchase price and this value is
maintained during the term of the agreement. If the seller defaults and the
collateral value declines, a Portfolio might incur a loss. If bankruptcy
proceedings are commenced with respect to the seller, a Portfolio's realization
upon the collateral may be delayed or limited. Each Portfolio may invest cash
balances in a joint repurchase agreement in accordance with an Order the
Delaware Group has obtained from the Commission under Section 17(d) of the 1940
Act.
SECURITIES LENDING ACTIVITIES
Each Portfolio 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 a Portfolio 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, a Portfolio will only enter into loan arrangements
after a review of all pertinent facts by the investment adviser, 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 investment adviser.
BORROWING FROM BANKS
Each Portfolio may borrow money as a temporary measure or to facilitate
redemptions. No Portfolio has the intention of increasing its net income
through borrowing. Any borrowing will be done from a bank and, consistent with
Commission rules, immediately after any borrowing is in an amount which exceeds
5% of its net assets, there must be asset coverage of at least 300%. In the
event the asset coverage declines below 300%, a Portfolio would take steps to
reduce the amount of its borrowings so that asset coverage would equal at least
300%. Securities will not be purchased while a Portfolio has an outstanding
borrowing.
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FOREIGN INVESTMENT INFORMATION
The International Equity Portfolio, The Labor Select International Equity
Portfolio, The Global Fixed Income Portfolio and The International Fixed Income
Portfolio (and The Defensive Equity Utility, The Real Estate Investment Trust,
and The High-Yield Bond Portfolios, up to 10% of their total assets) will invest
in securities of foreign issuers and may hold foreign currency. Investments in
obligations of foreign issuers involve somewhat different investment risks than
those affecting obligations of United States issuers. There is limited publicly
available information with respect to foreign issuers, and foreign issuers are
not subject to uniform accounting, auditing and financial standards and
requirements comparable to those applicable to domestic companies. There is
also less government supervision and regulation of foreign securities exchanges,
brokers and listed companies than in the United States and it is more difficult
to enforce legal rights outside of the U.S. Many foreign securities markets
have substantially less volume than U.S. national securities exchanges, and
securities of some foreign issuers are less liquid and more volatile than
securities of comparable domestic issuers. Settlement practices of certain
foreign countries may include delays and may otherwise differ from those
customary in U.S. markets. Brokerage commissions and other transaction costs on
foreign securities exchanges are generally higher than in the United States. It
is also expected that the expenses for custodial arrangements of The
International Equity, The Defensive Equity Utility, The Labor Select
International Equity, The Real Estate Investment Trust, The Global Fixed Income,
The International Fixed Income and The High-Yield Bond Portfolios' foreign
securities will be somewhat greater than the expenses for the custodial
arrangements for U.S. securities of equal value. Dividends and interest paid by
foreign issuers may be subject to withholding and other foreign taxes. Although
in some countries a portion of these taxes is recoverable, the non-recovered
portion of foreign withholding taxes will reduce the income a Portfolio receives
from the companies comprising the Portfolio's investments. See "TAXES."
Additional risks include future political and economic developments, the
possibility that a foreign jurisdiction might impose or change withholding taxes
on income payable with respect to foreign securities, possible seizure,
nationalization or expropriation of the foreign issuer or foreign deposits and
the possible adoption of foreign government restrictions such as exchange
controls. Also, because a Portfolio may hold foreign currency and because
stocks of foreign companies are normally denominated in foreign currencies, the
Portfolio may be affected favorably or unfavorably by changes in currency rates
and exchange control regulations, and may incur costs in connection with
conversions between various currencies. See "FORWARD FOREIGN CURRENCY EXCHANGE
CONTRACTS" below.
The risks noted above often are heightened for investments in emerging or
developing countries. Compared to the United States and other developed
countries, emerging or developing countries may have relatively unstable
governments, economies based on only a few industries, and securities markets
that trade a small number of securities. Prices on these exchanges tend to be
volatile and, in the past, securities in these countries have offered greater
potential for gain (as well as loss) than securities of companies located in
developed countries. Further, investments by foreign investors are subject to a
variety of restrictions in many emerging or developing countries. These
restrictions may take the form of prior governmental approval, limits on the
amount or type of securities held by foreigners, and limits on the type of
companies in which foreigners may invest. Additional restrictions may be
imposed at any time by these or other countries in which a Portfolio invests.
In addition, the repatriation of both investment income and capital from several
foreign countries is restricted and controlled under certain regulations,
including in some cases the need for certain government consents. Although
these restrictions may in the future make it undesirable to invest in emerging
or developing countries, the Portfolios' investment advisers do not believe that
any current repatriation restrictions would affect their decision to invest in
such countries.
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FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS
As noted above, the foreign investments made by The International Equity, The
Defensive Equity Utility, The Labor Select International Equity, The Real Estate
Investment Trust, The Global Fixed Income and The International Fixed Income
Portfolios present currency considerations which pose special risks. The
investment advisers use a purchasing power parity approach to evaluate currency
risk. A purchasing power parity approach attempts to identify the amount of
goods and services that a dollar will buy in the United States and compares that
to the amount of a foreign currency required to buy the same amount of goods and
services in another country. When the dollar buys less abroad, the foreign
currency may be considered to be overvalued. When the dollar buys more abroad,
the foreign currency may be considered to be undervalued. Eventually,
currencies should trade at levels that should make it possible for the dollar to
buy the same amount of goods and services overseas as in the United States.
Although The International Equity Portfolio, The Defensive Equity Utility
Portfolio, The Labor Select International Equity Portfolio, The Real Estate
Investment Trust Portfolio, The Global Fixed Income Portfolio and The
International Fixed Income Portfolio value their assets daily in terms of U.S.
dollars, they do not intend to convert their holdings of foreign currencies into
U.S. dollars on a daily basis. A Portfolio will, however, from time to time,
purchase or sell foreign currencies and/or engage in forward foreign currency
transactions in order to expedite settlement of Portfolio transactions and to
minimize currency value fluctuations. A Portfolio may conduct its 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). A Portfolio will
convert currency on a spot basis from time to time, and investors should be
aware of the costs of currency conversion.
A forward contract involves an obligation to purchase or sell a specific
currency at a future date, which may be any fixed number of days from the date
of the contract, agreed upon by the parties, at a price set at the time of the
contract.
A Portfolio 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. By entering into a
forward contract for the purchase or sale, for a fixed amount of U.S. dollars or
foreign currency, of the amount of foreign currency involved in the underlying
security transaction, a Portfolio will be able to protect itself against a
possible loss resulting from an adverse change in currency exchange rates during
the period between the date the security is purchased or sold and the date on
which payment is made or received.
For example, when the investment adviser believes that the currency of a
particular foreign country may suffer a significant decline against the U.S.
dollar or against another currency, a Portfolio 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 Portfolio's securities denominated in such foreign currency. A Portfolio
will not enter into forward contracts or maintain a net exposure to such
contracts where the consummation of the contracts would obligate the Portfolio
to deliver an amount of foreign currency in excess of the value of the
Portfolio's securities or other assets denominated in that currency.
The Portfolios may enter into forward contracts to hedge the currency risk
associated with the purchase of individual securities denominated in particular
currencies. In the alternative, the Portfolios may also engage in currency
"cross hedging" when, in the opinion of the investment advisers, as appropriate,
the historical relationship among foreign currencies suggests that the
Portfolios may achieve the same protection for a foreign security at reduced
cost and/or administrative burden through the use of a forward contract relating
to a currency other than the U.S. dollar or the foreign currency in which the
security is denominated.
At the maturity of a forward contract, a Portfolio may either sell the portfolio
security and make delivery of the foreign currency, or it may retain the
security and terminate its contractual obligation to deliver the foreign
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currency by purchasing an "offsetting" contract with the same currency trader
obligating it to purchase, on the same maturity date, the same amount of the
foreign currency. The Portfolio may realize gain or loss from currency
transactions.
With respect to forward foreign currency contracts, the precise matching of
forward contract amounts and the value of the securities involved is generally
not possible since the future value of such securities in foreign currencies
will change as a consequence of market movements in the value of those
securities between the date the forward contract is entered into and the date it
matures. The projection of short-term currency strategy is highly uncertain.
It is impossible to forecast the market value of Portfolio securities at the
expiration of the contract. Accordingly, it may be necessary for a Portfolio to
purchase additional foreign currency on the spot market (and bear the expense of
such purchase) if the market value of the security is less than the amount of
foreign currency the Portfolio is obligated to deliver and if a decision is made
to sell the security and make delivery of the foreign currency. Conversely, it
may be necessary to sell on the spot market some of the foreign currency
received upon the sale of a Portfolio security if its market value exceeds the
amount of foreign currency the Portfolio is obligated to deliver.
HIGH-YIELD, HIGH RISK SECURITIES
The International Fixed Income Portfolio and The Global Fixed Income Portfolio
may each invest up to 5% of its assets in high risk, high-yield fixed income
securities of foreign governments, including so-called Brady Bonds. In addition,
The Defensive Equity Utility Portfolio may invest up to 10% of its total assets
in fixed income securities rated below investment grade. These securities are
rated lower than BBB by S&P and Baa by Moody's or, if unrated, are considered by
the investment manager to have characteristics similar to such rated securities.
Finally, The High-Yield Bond Portfolio invests primarily in securities rated CCC
or higher by S&P or Caa or higher by Moody's, or, if unrated, judged to be of
comparable quality by the investment adviser. See "APPENDIX A--RATINGS" to this
Prospectus for more rating information. The discussion in this Section
supplements the description of the risks of high-yield securities found earlier
in this Prospectus in "INVESTMENT OBJECTIVES, POLICIES AND RISK CONSIDERATIONS -
THE HIGH-YIELD BOND PORTFOLIO," and investors should refer to that Section for a
further discussion of the risks of high-yield bonds.
Fixed income securities of this type are considered to be of poor standing and
predominantly speculative. Such securities are subject to a substantial degree
of credit risk. In the past, the high-yields from these bonds have more than
compensated for their higher default rates. There can be no assurance, however,
that yields will continue to offset default rates on these bonds in the future.
The Portfolios' investment advisers intend to maintain an adequately diversified
portfolio of these bonds. While diversification can help to reduce the effect
of an individual default on the Portfolios, there can be no assurance that
diversification will protect the Portfolios from widespread bond defaults
brought about by a sustained economic downturn.
Medium and low-grade bonds held by the Portfolios may be issued as a consequence
of corporate restructurings, such as leveraged buy-outs, mergers, acquisitions,
debt recapitalizations or similar events. Also, these bonds are often issued by
smaller, less creditworthy companies or by highly leveraged (indebted) firms,
which are generally less able than more financially stable firms to make
scheduled payments of interest and principal. The risks posed by bonds issued
under such circumstances are substantial.
The economy and interest rates may affect these high-yield, high risk securities
differently from other securities. Prices have been found to be less sensitive
to interest rate changes than higher rated investments, but more sensitive to
adverse economic changes or individual corporate developments. Also, during an
economic downturn or substantial period of rising interest rates, highly
leveraged issuers may experience financial stress which would adversely affect
their ability to service principal and interest payment obligations, to meet
projected
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business goals and to obtain additional financing. Changes by
recognized rating agencies in their rating of any security and in the ability of
an issuer to make payments of interest and principal will also ordinarily have a
more dramatic effect on the values of these investments than on the values of
higher-rated securities. Such changes in value will not affect cash income
derived from these securities, unless the issuers fail to pay interest or
dividends when due. Such changes will, however, affect the Portfolios' net
asset value per share.
The International Fixed Income and The Global Fixed Income Portfolios also have
the ability to invest in Brady Bonds issued pursuant to the Brady Plan. Brady
Bonds are debt securities issued under the framework of the Brady Plan, an
initiative announced by former U.S. Treasury Secretary Nicholas F. Brady in 1989
as a mechanism for debtor nations to restructure their outstanding external
indebtedness (generally commercial bank debt). In restructuring its external
debt under the Brady Plan framework, a debtor nation negotiates with its
existing bank lenders as well as multilateral institutions such as the World
Bank and the International Monetary Fund. The Brady Plan framework, as it has
developed, contemplates the exchange of commercial bank debt for new issued
bonds (Brady Bonds). The investment managers believe that economic reforms
undertaken by countries in connection with the issuance of Brady Bonds make the
debt of countries which have issued or have announced plans to issue Brady Bonds
an attractive opportunity for investment. Investors, however, should recognize
that the Brady Plan only sets forth general guiding principles for economic
reform and debt reduction, emphasizing that solutions must be negotiated on a
case-by-case basis between debtor nations and their creditors. In addition,
Brady Bonds have been issued only recently and, accordingly, do not have a long
payment history. See "FOREIGN INVESTMENT INFORMATION" above.
FUTURES CONTRACTS AND OPTIONS ON FUTURES CONTRACTS
In order to remain fully invested, to facilitate investments in equity
securities and to reduce transaction costs, The Aggressive Growth Portfolio and
The Real Estate Investment Trust Portfolio may, to a limited extent, enter into
futures contracts, purchase or sell options on futures contracts and engage in
certain transactions in options on securities, and may enter into closing
transactions with respect to such activities. The Portfolios will only enter
into these transactions for hedging purposes if it is consistent with the
Portfolios' investment objectives and policies and the Portfolios will not
engage in such transactions to the extent that obligations relating to futures
contracts, options on futures contracts and options on securities, in the
aggregate, exceed 25% of the Portfolios' assets.
Additionally, the International Fixed Income Portfolio may enter into futures
contracts, purchase or sell options on futures contracts, and trade in options
on foreign currencies, and may enter into closing transactions with respect to
such activities. The Portfolios will enter into such transactions to hedge or
"cross hedge" the currency risks associated with its investments, as described
under "FORWARD FOREIGN CURRENCY EXCHANGE CONTRACTS," above.
The Aggressive Growth Portfolio and The Real Estate Equity Portfolio may enter
into contracts for the purchase or sale for future delivery of securities. When
a futures contract is sold, the Portfolios incur a contractual obligation to
deliver the securities underlying the contract at a specified price on a
specified date during a specified future month. A purchase of a futures
contract means the acquisition of a contractual right to obtain delivery to the
Portfolio of the securities called for by the contract at a specified price
during a specified future month. Because futures contracts require only a small
initial margin deposit, the Portfolios would then be able to keep a cash reserve
applicable to meet potential redemptions while at the same time being
effectively fully invested.
Foreign currency futures contracts operate similarly to futures contracts
concerning securities. When The International Fixed Income Portfolio sells a
futures contract on a foreign currency, it is obligated to deliver that foreign
currency at a specified future date. Similarly, a purchase by the Portfolio
gives it a contractual right to receive a foreign currency. This enables the
Portfolio to "lock in" exchange rates.
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The Portfolios may also purchase and write options to buy or sell futures
contracts. Options on futures are similar to options except that options on
futures give the purchaser the right, in return for the premium paid, to assume
a position in a futures contract, rather than actually to purchase or sell the
futures contract, at a specified exercise price at any time during the period of
the option. The Portfolios will not enter into futures contracts and options
thereon to the extent that more than 5% of a Portfolio's assets are required as
futures contract margin deposits and premiums on options and only to the extent
that obligations under such contracts and options would not exceed 20% of the
Portfolio's total assets.
To the extent that interest or exchange rates move in an unexpected direction,
the Portfolio may not achieve the anticipated benefits of investing in futures
contracts and options thereon, or may realize a loss. To the extent that a
Portfolio purchases an option on a futures contract and fails to exercise the
option prior to the exercise date, it will suffer a loss of the premium paid.
Further, the possible lack of a secondary market would prevent the Portfolio
from closing out its positions relating to futures.
OPTIONS
Options on Securities
The Aggressive Growth Portfolio and The Real Estate Equity Portfolio may write
covered call options on U.S. securities, purchase call options on such
securities and enter into closing transactions related thereto. A Portfolio may
also purchase put options on U.S. securities, may write secured put options on
such securities and enter into closing transactions related thereto.
A covered call option obligates the writer, in return for the premium received,
to sell one of its securities to the purchaser of the option for an agreed price
up to an agreed date. The advantage is that the writer receives premium income
and the purchaser may hedge against an increase in the price of securities it
ultimately wishes to buy. A Portfolio will only purchase call options to the
extent that premiums paid on all outstanding call options do not exceed 2% of
the Portfolio's total assets.
A put option obligates the writer, in return for the premium received, to buy
the security underlying the option at the exercise price during the option
period, and the purchaser of the option has the right to sell the security to
the writer. The Portfolios will only write put options on a secured basis
which means that the Portfolios will maintain, in a segregated account with the
Custodian Bank, cash or U.S. Government securities in an amount not less than
the exercise price of the option at all times during the option period. A
Portfolio will only purchase put options if the Portfolio owns the security
covered by the put option at the time of purchase and to the extent that the
premiums on all outstanding put options do not exceed 2% of the Portfolio's
total assets. The advantage is that the writer receives premium income while
the purchaser can be protected should the market value of the security decline.
Closing transactions essentially let the Portfolios offset put options or call
options prior to exercise or expiration. If a Portfolio cannot effect closing
transactions, it may have to hold a security it would otherwise sell or deliver
a security it might want to hold.
The Portfolios may use both Exchange-traded and over-the-counter options.
Certain over-the-counter options may be illiquid. The Aggressive Growth
Portfolio will only invest in such options to the extent consistent with its 10%
limit on investments in illiquid securities, and The Real Estate Investment
Trust Portfolio will only invest in such options to the extent consistent with
its 15% limit in investments in illiquid securities.
With respect to writing covered call options, the Portfolios may lose the
potential market appreciation of the securities subject to the option, if the
investment adviser's judgment is wrong and the price of the security moves in
the opposite direction from what was anticipated. In purchasing put and call
options, the premium paid by a Portfolio plus any transaction costs will reduce
any benefit realized by the Portfolio upon exercise of
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the option. When writing put options, the Portfolios may be required, when the
put is exercised, to purchase securities at higher prices than current market
prices.
Options on Foreign Currencies
The International Fixed Income Portfolio may purchase call options and write
covered call options on foreign currencies and enter into related closing
transactions. The Portfolio may also purchase put options and write secured put
options on foreign currencies and enter into related closing transactions. The
Portfolio will enter into such transactions to hedge or "cross hedge" the
currency risks associated with its investments, as described under "FORWARD
FOREIGN CURRENCY EXCHANGE CONTRACTS," above.
Options on foreign currencies operate similarly to options on securities. The
purchase of an option on a foreign currency may constitute an effective hedge
against fluctuations in exchange rates although, in the event of a rate movement
adverse to the Portfolio's position, the Portfolio may forfeit the entire amount
of the premium plus any related transaction costs. As in the case of other
types of options, the writing of an option on a foreign currency will constitute
only a partial hedge, up to the amount of the premium received, and the
Portfolio could be required to purchase or sell foreign currencies at
disadvantageous exchange rates, thereby incurring losses.
The Portfolio will write call options only if they are "covered" and put options
only if they are secured. A call written by the Portfolio will be considered
covered if the Portfolio owns short-term debt securities with a value equal to
the face amount of the option contract and denominated in the currency upon
which the call is written. A put option written by the Portfolio will be
considered secured if, so long as the Portfolio is obligated as the writer of
the put, it segregates with its Custodian Bank cash or liquid high grade debt
securities equal at all times to the aggregate exercise price of the put.
RISKS OF TRANSACTIONS IN OPTIONS, FUTURES AND FORWARD CONTRACTS
The use of futures contracts, options on futures contracts, forward contracts
and certain options for hedging and other non-speculative purposes as described
above involves certain risks. For example, a lack of correlation between price
changes of an option or futures contract and the assets being hedged could
render a Portfolio's hedging strategy unsuccessful and could result in losses.
The same results could occur if movements of foreign currencies do not correlate
as expected by the investment manager at a time when a Portfolio is using a
hedging instrument denominated in one foreign currency to protect the value of a
security denominated in a second foreign currency against changes caused by
fluctuations in the exchange rate for the dollar and the second currency. If
the direction of securities prices, interest rates or foreign currency prices is
incorrectly predicted, the Portfolio will be in a worse position than if such
transactions had not been entered into. In addition, since there can be no
assurance that a liquid secondary market will exist for any contract purchased
or sold, a Portfolio may be required to maintain a position (and in the case of
written options may be required to continue to hold the securities used as
cover) until exercise or expiration, which could result in losses. Further,
options and futures contracts on foreign currencies, and forward contracts,
entail particular risks related to conditions affecting the underlying currency.
Over-the-counter transactions in options and forward contracts also involve
risks arising from the lack of an organized exchange trading environment.
RESTRICTED/ILLIQUID SECURITIES
Each Portfolio 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 ("1933 Act"). Rule 144A exempts
many privately placed and legally restricted securities from the registration
requirements of the 1933 Act and permits such securities to be freely traded
among certain institutional buyers such as the Portfolios. Each Portfolio,
other than The Defensive Equity Small/Mid-Cap, The Defensive Equity Utility, The
Labor Select International Equity, The Real Estate Investment Trust, The High-
Yield Bond and The International Fixed
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Income Portfolios, may invest no more than 10% of the value of its net assets in
illiquid securities. The Defensive Equity Small/Mid-Cap, The Defensive Equity
Utility, The Labor Select International Equity, The Real Estate Investment
Trust, The High-Yield Bond and The International Fixed Income Portfolios may
each invest no more than 15% of the value of its net assets in illiquid
securities. Illiquid securities, for purposes of this policy, include repurchase
agreements maturing in more than seven days.
While maintaining oversight, the Board of Directors has delegated to each
Portfolio's investment manager the day-to-day functions of determining whether
or not individual Rule 144A Securities are liquid for purposes of a Portfolio's
limitation on investments in illiquid assets. The Board has instructed each
Portfolio's investment manager to consider the following factors in determining
the liquidity of a Rule 144A Security: (i) the frequency of trades and trading
volume for the security; (ii) whether at least three dealers are willing to
purchase or sell the security and the number of potential purchasers; (iii)
whether at least two dealers are making a market in the security; and (iv) the
nature of the security and the nature of the marketplace trades (e.g., the time
needed to dispose of the security, the method of soliciting offers, and the
mechanics of transfer).
If an investment adviser determines that a Rule 144A Security which was
previously determined to be liquid is no longer liquid and, as a result, the
Portfolio's holdings of illiquid securities exceed the Portfolio's 10% limit on
investment in such securities, the investment adviser will determine what action
shall be taken to ensure that the Portfolio continues to adhere to such
limitation.
CONVERTIBLE AND DEBT SECURITIES
From time to time, The Defensive Equity Utility Portfolio may invest in
convertible securities of issuers in the utility industry. In addition, a
portion of The Defensive Equity Small/Mid-Cap and The High-Yield Bond
Portfolios' assets may be invested in convertible and debt securities of issuers
in any industry, and The Real Estate Investment Trust Portfolio's assets may be
invested in convertible securities of issuers in the real estate industry. A
convertible security is a security which may be converted at a stated price
within a specified period of time into a certain quantity of the common stock of
the same or a different issuer. Convertible and debt securities are senior to
common stocks in a corporation's capital structure, although convertible
securities are usually subordinated to similar nonconvertible securities.
Convertible and debt securities provide a fixed income stream and the
opportunity, through its conversion feature, to participate in the capital
appreciation resulting from a market price advance in the convertible security's
underlying common stock. Just as with debt securities, convertible securities
tend to increase in market value when interest rates decline and tend to
decrease in value when interest rates rise. However, the price of a convertible
security is also influenced by the market value of the security's underlying
common stock and tends to increase as the market value of the underlying stock
rises, whereas it tends to decrease as the market value of the underlying stock
declines. Convertible and debt securities acquired by The Defensive Equity
Small/Mid-Cap, The Defensive Equity Utility, The Real Estate Investment Trust
and The High-Yield Bond Portfolios may be rated below investment grade, or
unrated. These lower rated convertible and debt securities are subject to
credit risk considerations substantially similar to such considerations
affecting high risk, high-yield bonds, commonly referred to as "junk bonds."
See "INVESTMENT OBJECTIVES, POLICIES AND RISK CONSIDERATIONS -- THE HIGH-YIELD
BOND PORTFOLIO" and "HIGH-YIELD, HIGH RISK SECURITIES" for a further discussion
of these types of investments.
The Defensive Equity Small/Mid-Cap, The Defensive Equity Utility, The Real
Estate Investment Trust and The High-Yield Bond Portfolios may invest in
convertible preferred stocks that offer enhanced yield features, such as
Preferred Equity Redemption Cumulative Stock ("PERCS"), which provide an
investor, such as a Portfolio, with the opportunity to earn higher dividend
income than is available on a company's common stock. A PERCS is a preferred
stock which generally features a mandatory conversion date, as well as a capital
appreciation limit which is usually expressed in terms of a stated price. Upon
the conversion date, most PERCS convert into common stock of the issuer (PERCS
are generally not convertible into cash at maturity). Under a typical
arrangement, if after a predetermined number of years the issuer's common stock
is trading at a price below that set by the capital appreciation limit, each
PERCS would convert to one share of common stock. If,
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however, the issuer's common stock is trading at a price above that set by the
capital appreciation limit, the holder of the PERCS would receive less than one
full share of common stock. The amount of that fractional share of common stock
received by the PERCS hold is determined by dividing the price set by the
capital appreciation limit of the PERCS by the market price of the issuer's
common stock. PERCS can be called at any time prior to maturity, and hence do
not provide call protection. However, if called early, the issuer may pay a call
premium over the market price to the investor. This call premium declines at a
preset rate daily, up to the maturity date of the PERCS.
The Defensive Equity Small/Mid-Cap, The Defensive Equity Utility, The Real
Estate Investment Trust and The High-Yield Bond Portfolios may also invest in
other enhanced convertible securities. These include but are not limited to
ACES (Automatically Convertible Equity Securities), PEPS (Participating Equity
Preferred Stock), PRIDES (Preferred Redeemable Increased Dividend Equity
Securities), SAILS (Stock Appreciation Income Linked Securities), TECONS (Term
Convertible Notes), QICS (Quarterly Income Cumulative Securities), and DECS
(Dividend Enhanced Convertible Securities). ACES, PEPS, PRIDES, SAILS, TECONS,
QICS, and DECS all have the following features: they are company-issued
convertible preferred stock; unlike PERCS, they do not have capital appreciation
limits; they seek to provide the investor with high current income, with some
prospect of future capital appreciation; they are typically issued with three to
four-year maturities; they typically have some built-in call protection for the
first two to three years; investors have the right to convert them into shares
of common stock at a present conversion ratio or hold them until maturity; and
upon maturity, they will automatically convert to either cash or a specified
number of shares of common stock.
REITS
The Real Estate Investment Trust Portfolio's investment in REITs presents
certain further risks that are unique and in addition to the risks associated
with investing in the real estate industry in general. Equity REITs may be
affected by changes in the value of the underlying property owned by the REITs,
while mortgage REITS may be affected by the quality of any credit extended.
REITs are dependent on management skills, are not diversified, and are subject
to the risks of financing projects. REITs whose underlying assets include long-
term health care properties, such as nursing, retirement and assisted living
homes, may be impacted by federal regulations concerning the health care
industry.
REITs (especially mortgage REITs) are also subject to interest rate risks - when
interest rates decline, the value of a REIT's investment in fixed rate
obligations can be expected to rise. Conversely, when interest rates rise, the
value of a REIT's investment in fixed rate obligations can be expected to
decline. In contrast, as interest rates on adjustable rate mortgage loans are
reset periodically, yields on a REIT's investments in such loans will gradually
align themselves to reflect changes in market interest rates, causing the value
of such investments to fluctuate less dramatically in response to interest rate
fluctuations than would investments in fixed rate obligations.
REITs may have limited financial resources, may trade less frequently and in a
limited volume, and may be subject to more abrupt or erratic price movements
than other securities.
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AMERICAN DEPOSITORY RECEIPTS
The Defensive Equity, The Defensive Equity Small/Mid-Cap, The Defensive Equity
Utility, The Real Estate Investment Trust, The Global Fixed Income, and The
International Fixed Income Portfolios may invest in sponsored and unsponsored
American Depository Receipts ("ADRs") that are actively traded in the United
States. ADRs are receipts typically issued by a U.S. bank or trust company
which evidence ownership of underlying securities issued by a foreign
corporation. "Sponsored" ADRs are issued jointly by the issuer of the
underlying security and a depository, and "unsponsored" ADRs are issued without
the participation of the issuer of the deposited security. Holders of
unsponsored ADRs generally bear all the costs of such facilities and the
depository of an unsponsored ADR facility frequently is under no obligation to
distribute shareholder communications received from the issuer of the deposited
security or to pass through voting rights to the holders of such receipts in
respect of the deposited securities. Therefore, there may not be a correlation
between information concerning the issuer of the security and the market value
of an unsponsored ADR.
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INVESTMENT LIMITATIONS
Each Portfolio's investment objectives, their designation as a diversified
portfolio or, in the case of The Defensive Equity Utility, The Real Estate
Investment Trust, The Global Fixed Income and The International Fixed Income
Portfolios, as non-diversified portfolios, and their policies concerning
portfolio lending, borrowing from a bank and concentration of investments in
specific industries may not be changed unless authorized by the vote of a
majority of a Portfolio's outstanding voting securities. A "majority vote of
the outstanding voting securities" is the vote by the holders of the lesser of
a) 67% or more of a Portfolio's voting securities present in person or
represented by proxy; or b) more than 50% of the outstanding voting securities.
The Statement of Additional Information lists other more specific investment
restrictions of each Portfolio which may not be changed without a majority
shareholder vote.
Except as specified above and under the heading "INVESTMENT OBJECTIVES, POLICIES
AND RISK CONSIDERATIONS" and as described under "INVESTMENT POLICIES, PORTFOLIO
TECHNIQUES AND RISK CONSIDERATIONS," in the Statement of Additional Information,
the foregoing investment policies are not fundamental and the directors may
change such policies without an affirmative vote of a "majority of the Fund's
outstanding voting securities," as defined in the 1940 Act.
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MANAGEMENT OF THE FUND
Directors
The business and affairs of the Fund and its Portfolios are managed under the
direction of the Fund's Board of Directors. See "FUND OFFICERS AND PORTFOLIO
MANAGERS" in the Prospectus Summary and the Fund's Statement of Additional
Information for additional information about the Fund's officers and directors.
Investment Advisers
Delaware Investment Advisers, a division of Delaware Management Company, Inc.
("Delaware"), furnishes investment advisory services to The Defensive Equity,
The Aggressive Growth, The Defensive Equity Small/Mid-Cap, The Defensive Equity
Utility, The Real Estate Investment Trust, The Fixed Income, The Limited-Term
Maturity, and The High-Yield Bond Portfolios. Lincoln Investment Management,
Inc. ("Lincoln"), a wholly-owned subsidiary of Lincoln National Corporation,
acts as sub-adviser to Delaware with respect to The Real Estate Investment
Portfolio. In its capacity as sub-adviser, Lincoln furnishes Delaware with
investment recommendations, asset allocation advice, research, economic analysis
and other investment services with respect to the securities in which The Real
Estate Investment Trust Portfolio may invest. Delaware and its predecessors
have been managing the funds in the Delaware Group since 1938. On October 31,
1994, Delaware and its affiliate, Delaware International, were supervising in
the aggregate more than $25 billion in assets in various institutional
(approximately $16,074,376,000) and investment company (approximately
$4,525,500,000) accounts. Lincoln (formerly named Lincoln National Investment
Management Company) was incorporated in 1930. Lincoln's primary activity is
institutional fixed-income investment management and consulting. Such activity
includes fixed income portfolios, private placements, real estate debt and
equity, and asset/liability management. As of June 30, 1995, Lincoln had over
$34 billion in assets under management. Lincoln provides investment management
services to Lincoln National Corporation, its principal subsidiaries and
affiliated registered investment companies, and acts as investment adviser to
other unaffiliated clients.
Delaware International Advisers Ltd. ("Delaware International") furnishes
investment advisory services to The International Equity Portfolio, The Labor
Select International Equity Portfolio, The Global Fixed Income Portfolio, and
The International Fixed Income Portfolio. Several of the principals of Delaware
International were previously associated with a registered investment adviser
which managed the assets of a registered investment company. Delaware
International commenced operations as a registered investment adviser in
December 1990.
Delaware has entered into Investment Advisory Agreements with the Fund on behalf
of The Defensive Equity, The Aggressive Growth, The Defensive Equity Small/Mid-
Cap, The Defensive Equity Utility, The Real Estate Investment Trust, The Fixed
Income, The Limited-Term Maturity and The High-Yield Bond Portfolios. Delaware
has also entered into a Sub-Advisory Agreement with Lincoln with respect to The
Real Estate Investment Trust Portfolio. Delaware International has entered into
Investment Advisory Agreements with the Fund on behalf of The International
Equity Portfolio, The Labor Select International Equity Portfolio, The Global
Fixed Income Portfolio and The International Fixed Income Portfolio. Under
these Agreements, Delaware and Delaware International, subject to the control
and supervision of the Fund's Board of Directors and in conformance with the
stated investment objectives and policies of the Portfolios with which they have
an agreement, manage the investment and reinvestment of the assets of the
Portfolios with which they have agreements. In this regard, it is their
responsibility to make investment decisions for the respective Portfolios.
As compensation for the services to be rendered under their advisory agreements,
Delaware or, as relevant, Delaware International is entitled to an advisory fee
calculated by applying a quarterly rate, based on the following annual
percentage rates, to the Portfolio's average daily net assets for the quarter:
-55-
<PAGE>
<TABLE>
<CAPTION>
Portfolio Rate
<S> <C>
The Defensive Equity Portfolio .55%
The Aggressive Growth Portfolio .80%
The International Equity Portfolio .75%
The Defensive Equity Small/Mid-Cap Portfolio .__%
The Defensive Equity Utility Portfolio .35%
The Labor Select International Equity Portfolio .75%
The Real Estate Investment Trust Portfolio .75%*
The Fixed Income Portfolio .40%
The Limited-Term Maturity Portfolio .30%
The Global Fixed Income Portfolio .50%
The International Fixed Income Portfolio .50%
The High-Yield Bond Portfolio .45%
</TABLE>
* Lincoln receives 30% of the management fee paid to Delaware for acting as
sub-adviser to The Real Estate Investment Trust Portfolio.
As noted in "FUND EXPENSES," Delaware or, as relevant, Delaware International
elected voluntarily to waive that portion, if any, of its investment advisory
fees and to reimburse a Portfolio's expenses to the extent necessary to ensure
that a Portfolio's expenses (investment advisory fees, plus certain other noted
expenses) do not exceed, on an annualized basis, the amounts noted in that
section of this Prospectus through October 31, 1995 with respect to The
Defensive Equity, The Aggressive Growth, The International Equity, The Fixed
Income, The Limited-Term Maturity, The Global Fixed Income and The International
Fixed Income Portfolios, and through October 31, 1996 with respect to the other
Portfolios of the Fund. In addition, out of the investment advisory fees to
which they are otherwise entitled, Delaware and Delaware International pay their
proportionate share of the fees paid to unaffiliated directors by the Fund,
except that Delaware will make no such payments out of the fees it receives for
managing The Defensive Equity Small/Mid-Cap, The Defensive Equity Utility, The
Real Estate Investment Trust and The High-Yield Bond Portfolios, and Delaware
International will make no such payments out of the fees it receives for
managing The Labor Select International Equity and The International Fixed
Income Portfolios. For the fiscal year ended October 31, 1994, the investment
management fees earned by The Defensive Equity, The Aggressive Growth, The
International Equity and The Global Fixed Income Portfolios were 0.54%, 0.79%,
0.74% and 0.49%, respectively, of average daily net assets. After considering
the waiver of fees by the respective investment manager, as described above, the
fees paid by The Defensive Equity, The Aggressive Growth, The International
Equity and The Global Fixed Income Portfolios amounted to 0.39%, 0.55%, 0.71%
and 0.35%, respectively, of average daily net assets.
Delaware 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
Delaware and Delaware International became indirect, wholly-owned subsidiaries
of Lincoln National and each is now subject to the ultimate control of Lincoln
National. Lincoln Investment Management, Inc. ("Lincoln"), the sub-adviser to
Delaware with respect to The Real Estate Investment Trust Portfolio, is also a
wholly-owned subsidiary of Lincoln National. Delaware, Delaware International,
and Lincoln may be deemed to be affiliated persons under the 1940 Act, as the
three companies are each under 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,
new Investment Management Agreements between the Fund on behalf of The Defensive
Equity Portfolio, The Aggressive Growth Portfolio, The Fixed Income Portfolio
and The Limited-Term Maturity Portfolio and Delaware, and new Investment
Management Agreements between the Fund on behalf of The International Equity
Portfolio, The Global Fixed Income Portfolio and The International Fixed Income
Portfolio
-56-
<PAGE>
and Delaware International were executed following shareholder approval.
Delaware's address is One Commerce Square, 2005 Market Street, Philadelphia, PA
19103. Delaware International's address is Veritas House, 125 Finsbury Pavement,
London, England EC2A INQ. Lincoln's address is 200 E. Berry Street, Fort Wayne,
Indiana 46802.
Administrator
Delaware Service Company, Inc., an affiliate of Delaware and an indirect,
wholly-owned subsidiary of DMH, provides the Fund with administrative services
pursuant to the Amended and Restated Shareholders Services Agreement with the
Fund on behalf of the Portfolios. The services provided under the Amended and
Restated Shareholders Services Agreement are subject to the supervision of the
officers and directors of the Fund, and include day-to-day administration of
matters related to the corporate existence of the Fund, maintenance of its
records, preparation of reports, supervision of the Fund's arrangements with its
Custodian Bank, and assistance in the preparation of the Fund's registration
statements under Federal and State laws. The Amended and Restated Shareholders
Services Agreement also provides that Delaware Service Company, Inc. will
provide the Fund with dividend disbursing and transfer agent services. Delaware
Service Company, Inc. is located at 1818 Market Street, Philadelphia, PA 19103.
For its services under the Amended and Restated Shareholders Services Agreement,
the Fund pays Delaware Service Company, Inc. an annual fixed fee, payable
monthly, and allocated among the Portfolios of the Fund based on the relative
percentage of assets of each Portfolio.
Distributor
Delaware Distributors, Inc. ("DDI"), 1818 Market Street, Philadelphia, PA 19103,
serves as the exclusive Distributor of the shares of the Fund's Portfolios.
Under its Distribution Agreements with the Fund on behalf of each Portfolio, DDI
sells shares of the Fund upon the terms and at the current offering price
described in this Prospectus. DDI is not obligated to sell any certain number
of shares of the Fund. DDI is an indirect, wholly-owned subsidiary of DMH.
Expenses
Each Portfolio is responsible for payment of certain other fees and expenses
(including legal fees, accountants' fees, custodial fees and printing and
mailing costs) specified in the Amended and Restated Shareholders Services
Agreement and each of the respective Distribution Agreements. The ratio of
expenses to average daily net assets for The Defensive Equity, The Aggressive
Growth, The International Equity and The Global Fixed Income Portfolios was
0.68%, 0.93%, 0.94% and 0.62%, respectively, for the period ended October 31,
1994. These ratios reflect the waiver of fees by the respective investment
manager, as described above.
-57-
<PAGE>
SHAREHOLDER SERVICES
Special Reports and Other Services
The Fund provides client shareholders with annual audited financial reports and
unaudited semi-annual financial reports. In addition, the investment advisers'
dedicated service staff may also provide client shareholders a detailed monthly
appraisal of the status of their account and a complete review of portfolio
assets, performance results, and other pertinent data. Finally, the investment
advisers expect to conduct personal reviews no less than annually with each
client shareholder, with interim telephone updates and other communication, as
appropriate. The Fund's dedicated telephone number, (1-800-231-8002), is
available for shareholder inquiries during normal business hours. The net asset
values for the Portfolios are also available by using the above "800" telephone
number.
Exchange Privilege
Each Portfolio's shares may be exchanged for shares of the Fund's other
Portfolios based on the respective net asset values of the shares involved and
as long as a Portfolio's minimum is satisfied. Exchange requests should be sent
to Delaware Pooled Trust, Inc., One Commerce Square, 2005 Market Street,
Philadelphia, PA 19103, Attn: Client Services. Such an exchange would be
considered a taxable event in instances where an institutional shareholder is
subject to tax. The exchange privilege is only available with respect to
Portfolios that are registered for sale in a shareholder's state of residence.
The Fund reserves the right to suspend or terminate, or amend the terms of, the
exchange privilege upon 60 days' written notice to client shareholders.
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<PAGE>
DIVIDENDS AND CAPITAL GAINS DISTRIBUTIONS
The Fund maintains the following dividend and capital gains policies for its
twelve Portfolios.
The Fixed Income, The Limited-Term Maturity, The Global Fixed Income and The
International Fixed Income Portfolios expect to declare dividends daily and
distribute them monthly. The Defensive Equity Utility and The High-Yield Bond
Portfolios expect to declare dividends monthly and distribute them monthly. The
Defensive Equity Small/Mid-Cap, The Defensive Equity, The International
Equity and The Labor Select International Portfolios expect to declare and
distribute all of their net investment income to shareholders as dividends
quarterly. The Aggressive Growth and The Real Estate Investment Trust
Portfolios expect to declare and distribute all of their net investment income
to shareholders as dividends annually.
Net capital gains, if any, will be distributed annually. Unless a shareholder
elects to receive dividends and capital gains distributions in cash, all
dividends and capital gains distributions shall be automatically paid in
additional shares at net asset value of the Portfolio.
In addition, in order to satisfy certain distribution requirements of the Tax
Reform Act of 1986, each Portfolio may declare special year-end dividend and
capital gains distributions during November or December to shareholders of
record on a date in such month. Such distributions, if received by shareholders
by January 31, are deemed to have been paid by a Portfolio and received by
shareholders on the earlier of the date paid or December 31 of the prior year.
For the fiscal year ended October 31, 1994, a dividend of $0.280, $0.020, $0.949
and $0.160 per share of The Defensive Equity, The Aggressive Growth, The Global
Fixed Income and The International Equity Portfolios, respectively, was paid
from net investment income. In addition, a distribution of $0.343, $0.210,
$0.577 and $0.100 per share of The Defensive Equity, The Aggressive Growth, The
Global Fixed Income, and The International Equity Portfolios, respectively, was
paid from realized securities profits.
-59-
<PAGE>
TAXES
General
Each Portfolio within the Fund has qualified or intends to qualify, and each
intends to continue to qualify, as a regulated investment company under the
Internal Revenue Code (the "Code"). As such, a Portfolio will not be subject to
federal income or excise tax to the extent its earnings are distributed to its
shareholders as provided in the Code.
Each Portfolio intends to distribute substantially all of its net investment
income and net capital gains. Dividends from net investment income or net
short-term capital gains will be taxable to you as ordinary income. For
corporate investors, dividends paid by The Defensive Equity and The Aggressive
Growth Portfolios from net investment income will generally qualify, in part,
for the intercorporate dividends-received deduction. However, the portion of
the dividends so qualified depends on the aggregate qualifying dividend income
received by a Portfolio from domestic (U.S.) sources. Of the dividends paid by
The Defensive Equity and The Aggressive Growth Portfolios for the fiscal year
ended October 31, 1994, 42% and 100%, respectively, were eligible for this
deduction.
Distributions paid by a Portfolio from long-term capital gains and reinvested 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 a Portfolio. The Portfolios do not seek to realize any
particular amount of capital gains during a year; rather, realized gains are a
byproduct of Portfolio 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 a Portfolio 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.
The sale of shares of a Portfolio 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 portfolios of a mutual fund). Any loss incurred on the
sale or exchange of the shares of a Portfolio, 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.
Each year, the Fund will mail to you information on the amount and tax status of
each Portfolio's dividends and distributions. Shareholders should consult their
own tax advisers regarding specific questions as to federal, state or local
taxes.
The Fund is required to withhold 31% of taxable dividends, capital gains
distributions, and redemptions paid to shareholders who have not complied with
IRS taxpayer identification regulations. You may avoid this withholding
requirement by certifying on your Account Registration Form your proper Taxpayer
Identification Number and by certifying that you are not subject to backup
withholding.
The International Equity Portfolio, The Labor Select International Equity
Portfolio, The Global Fixed Income Portfolio and The International Fixed Income
Portfolio - Foreign Taxes
Each of The International Equity Portfolio, The Labor Select International
Equity Portfolio, The Global Fixed Income Portfolio and The International Fixed
Income Portfolio may elect to "pass-through" to its shareholders the amount of
foreign income taxes paid by such Portfolio. A Portfolio will make such an
election only if it deems it to be in the best interests of its shareholders.
-60-
<PAGE>
If this election is made, shareholders of a Portfolio will be required to
include in their gross income their pro-rata share of foreign taxes paid by the
Portfolio. However, shareholders will be able to treat their pro-rata share of
foreign taxes as either an itemized deduction or a foreign tax credit (but not
both) against U.S. income taxes on their tax return.
The tax discussion set forth above is included for general information only.
Prospective investors should consult their own tax advisers concerning the tax
consequences of an investment in the Fund.
VALUATION OF SHARES
The net asset value per share of each Portfolio is determined by dividing the
total market value of the Portfolio's investments and other assets, less any
liabilities, by the total outstanding shares of the Portfolio. Net asset value
per share is determined as of the close of regular trading on the NYSE on each
day the NYSE is open for business. Securities listed on a U.S. securities
exchange for which market quotations are available are valued at the last quoted
sale price on the day the valuation is made. Price information on listed
securities is taken from the exchange where the security is primarily traded.
Securities listed on a foreign exchange are valued at the last quoted sale price
available before the time when net assets are valued. Unlisted securities and
listed securities not traded on the valuation date for which market quotations
are readily available are valued at a price that is considered to best represent
fair value within a range not in excess of the current asked price nor less than
the current bid prices. Domestic equity securities traded over-the-counter,
domestic equity securities which are not traded on the valuation date and U.S.
Government securities are priced at the mean of the bid and ask price.
Bonds and other fixed income securities are valued according to the broadest and
most representative market, which will ordinarily be the over-the-counter
market. In addition, bonds and other fixed income securities may be valued on
the basis of prices provided by a pricing service when such prices are believed
to reflect the fair market value of such securities. The prices provided by a
pricing service are determined without regard to bid or last sale prices but
take into account institutional size trading in similar groups of securities and
any developments related to the specific securities. Securities not priced in
this manner are valued at the most recent quoted mean price, or, when stock
exchange valuations are used, at the latest quoted sale price on the day of
valuation. If there is no such reported sale, the latest quoted mean price will
be used. Securities with remaining maturities of 60 days or less are valued at
amortized cost, if it approximates market value. In the event that amortized
cost does not approximate market value, market prices as determined above will
be used.
Exchange-traded options are valued at the last reported sales price or, if no
sales are reported, at the mean between the last reported bid and ask prices.
Non-exchange traded options are valued at fair value using a mathematical model.
Futures contracts are valued at their daily quoted settlement price. The value
of other assets and securities for which no quotations are readily available
(including restricted securities) are determined in good faith at fair value
using methods determined by the Fund's Board of Directors.
The securities in which The International Equity Portfolio,The Labor Select
International Equity Portfolio, The Global Fixed Income Portfolio and The
International Fixed Income Portfolio(and, to a limited extent, The Defensive
Equity Utility Portfolio, The Real Estate Investment Trust Portfolio, and The
High-Yield Bond Portfolio) may invest from time to time may be listed primarily
on foreign exchanges which trade on days when the NYSE is closed (such as
Saturday). As a result, the net asset value of those Portfolios may be
significantly affected by such trading on days when shareholders have no access
to the Portfolios.
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<PAGE>
For purposes of calculating net asset value per share, all assets and
liabilities initially expressed in foreign currencies will be converted into
U.S. dollars at the mean between the bid and ask price of such currencies
against the U.S. dollar as provided by an independent pricing service or any
major bank, including the Custodian Bank. Forward foreign currency contracts
are valued at the mean price of the contracts. Interpolated values will be
derived when the settlement date of the contract is on an interim period for
which quotations are not available.
PORTFOLIO TRANSACTIONS
In purchasing and selling securities for each of the Portfolios, the Fund (and,
in the case of The International Equity Portfolio, The Labor Select
International Equity Portfolio, The Global Fixed Income Portfolio and The
International Fixed Income Portfolio, the investment adviser) uses its best
efforts to obtain the best available price and most favorable execution and may,
where relevant, pay higher commissions in recognition of brokerage services
which in the opinion of the Fund's trading department (and, in the case of The
International Equity Portfolio, The Labor Select International Equity Portfolio,
The Global Fixed Income Portfolio and The International Fixed Income Portfolio,
the investment manager) are necessary and in the best interest of the Fund's
shareholders. In selecting broker/dealers to execute the securities transactions
for the Portfolios, consideration will be given to such factors as the price of
the security, the rate of any commission, the size and difficulty of the order,
the reliability, integrity, financial condition, general execution and
operational capabilities of competing broker/dealers, and any brokerage and
research services which they provide to the Fund. These services may be used by
the investment advisers in servicing any of their other accounts. Some
securities considered for investment by each of the Fund's Portfolios may also
be appropriate for other clients served by the investment advisers. If a
purchase or sale of securities consistent with the investment policies of a
Portfolio and one or more of these other clients served by the investment
advisers is considered at or about the same time, transactions in such
securities will be allocated among the Portfolio and clients in a manner deemed
fair and reasonable. Although there is no specified formula for allocating such
transactions, the various allocation methods used and the results of such
allocations are subject to periodic review by the Fund's directors.
Since shares of the Fund's Portfolios are not marketed through intermediary
brokers or dealers, it is not the Fund's practice to allocate brokerage or
principal business on the basis of sales of shares which may be made through
such firms. However, portfolio orders may be placed with qualified
broker/dealers who recommend the Fund's Portfolios or who act as agents in the
purchase of shares of the Portfolios for their clients. The portfolio turnover
rates for the fiscal years ended October 31, 1993 and 1994 for The Defensive
Equity Portfolio were 37% and 73%, respectively. The portfolio turnover rates
for the fiscal years ended October 31, 1993 and 1994 for The Aggressive Growth
Portfolio were 81% and 43%, respectively. The portfolio turnover rates for the
fiscal year ended October 31, 1993 and 1994 for The International Equity
Portfolio were 28% and 22%, respectively. For the period November 30, 1992
(date of initial sale) to October 31, 1993, The Global Fixed Income Portfolio's
annualized portfolio turnover rate was 198%, and for the fiscal year ended
October 31, 1994 was 205%. See "PORTFOLIO TURNOVER" under "TRADING PRACTICES
AND BROKERAGE" in the Statement of Additional Information.
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<PAGE>
PERFORMANCE INFORMATION
From time to time, the Portfolios may quote yield in advertising and other types
of sales literature. The current yield for each of these Portfolios will be
calculated by dividing the annualized net investment income earned by each of
the Portfolios during a recent 30-day period by the offering price per share
(net asset value) on the last day of the period. The yield information provides
for semi-annual compounding which assumes that net investment income is earned
and reinvested at a constant rate and annualized at the end of a six-month
period. Each Portfolio also may quote total return performance 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 at the beginning of the specific period. Each presentation will include,
as relevant, the average annual total return for one-, five- and ten-year
periods. Each Portfolio may also advertise aggregate and average total return
information over additional periods of time.
Yield and net asset value fluctuate and are not guaranteed. Past performance is
not an indication of future results.
GENERAL INFORMATION
Description of Common Stock
The Fund was organized as a Maryland corporation on May 30, 1991. The Articles
of Incorporation permit the Fund to issue one billion shares of common stock
with $.01 par value and fifty million shares have been allocated to each
Portfolio. The Board of Directors has the power to designate one or more
classes of shares of common stock and to classify and reclassify any unissued
shares with respect to such classes.
The shares of each Portfolio, when issued, will be fully paid, non-assessable,
fully transferable and redeemable at the option of the holder. The shares have
no preference as to the conversion, exchange, dividends, retirement or other
features and have no preemptive rights. The shares of each Portfolio have
noncumulative voting rights, which means that the holders of more than 50% of
the shares voting for the election of directors can elect 100% of the directors
if they choose to do so. Shares of each Portfolio entitled to vote on a matter
will vote in the aggregate and not by Portfolio, except when the matter to be
voted upon affects only the interests of shareholders of a particular Portfolio
or when otherwise expressly required by law. The Fund does not issue
certificates for shares unless a shareholder submits a specific request. Under
Maryland law, the Fund is not required, and does not intend, to hold annual
meetings of its shareholders unless, under certain circumstances, it is required
to do so under the 1940 Act.
Custodian Bank
Securities and cash are held by The Morgan Guaranty Trust Company of New York,
60 Wall Street, New York, NY 10260, as the Fund's custodian bank for all
Portfolios.
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<PAGE>
Independent Auditors
Ernst & Young, Two Commerce Square, 2001 Market Street, Suite 4000,
Philadelphia, PA 19103, serves as independent auditors for the Fund.
Expenses
Each Portfolio is responsible for all its own expenses other than those borne by
its investment adviser under the relevant Investment Advisory Agreement and the
distributor under the Distribution Agreement.
Litigation
The Fund is not involved in any litigation.
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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.
Commercial Paper
Excerpts from Moody's description of its two highest commercial paper ratings:
P-1A the highest grade possessing greatest relative strength; P-2A second
highest grade possessing less relative strength than the highest grade.
Excerpts from S&P's description of its two highest commercial paper ratings:
A-1A judged to be the highest investment grade category possessing the highest
relative strength; A-2A investment grade category possessing less relative
strength than the highest rating.
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<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
PART B
------
<TABLE>
<CAPTION>
Location in Statement
Item No. Description of Additional Information
-------- ----------- --------------------------
<C> <S> <C>
10 Cover Page ............................. Cover
11 Table of Contents ...................... Table of Contents
12 General Information and History ........ General Information
13 Investment Objectives and Policy ....... Investment Policies, Portfolio
Techniques and Risk
Considerations
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, Investment
Management Agreement, General
Information, Financial Statements
17 Brokerage Allocation ................... Trading Practices and Brokerage
18 Capital Stock and Other Securities ..... Capitalization and Noncumulative
Voting (under General
Information)
19 Purchase, Redemption and Pricing of
Securities Being Offered .............. Purchasing Shares, Redemption
and Repurchase, Determining
Net Asset Value
20 Tax Status ............................. Accounting and Tax Issues, Taxes
21 Underwriters ........................... Purchasing Shares
22 Calculation of Performance Data ........ Performance Information
23 Financial Statements ................... Financial Statements
</TABLE>
<PAGE>
--------------------------------------------------------------------------------
INFORMATION CONTAINED HEREIN IS SUBJECT TO COMPLETION OR AMENDMENT. A
REGISTRATION STATEMENT RELATING TO THESE SECURITIES HAS BEEN FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION. THESE SECURITIES MAY NOT BE SOLD NOR MAY
OFFERS TO BUY BE ACCEPTED PRIOR TO THE TIME THE REGISTRATION STATEMENT BECOMES
EFFECTIVE. THIS STATEMENT OF ADDITIONAL INFORMATION DOES NOT CONSTITUTE A
PROSPECTUS.
--------------------------------------------------------------------------------
PRELIMINARY STATEMENT OF ADDITIONAL INFORMATION
DATED SEPTEMBER 15, 1995
SUBJECT TO COMPLETION
PART B
DELAWARE POOLED TRUST, INC.
STATEMENT OF ADDITIONAL INFORMATION
____________________, 1995
___________________________________
Delaware Pooled Trust, Inc. ("Fund") is a no-load, open-end management
investment company. The Fund consists of twelve series ("Portfolios") offering a
broad range of investment choices. The Fund is designed to provide clients with
attractive alternatives for meeting their investment needs. Shares of the
Portfolios are offered with no sales charge or exchange or redemption fee. This
Statement of Additional Information addresses information of the Fund applicable
to each of the twelve Portfolios.
This Statement of Additional Information is not a prospectus but should be
read in conjunction with the Prospectus of the Fund dated _____________ , 1995.
To obtain a Prospectus, please write to the Delaware Pooled Trust, Inc. at One
Commerce Square, 2005 Market Street, Philadelphia, PA 19103, Attn: Client
Services or call the Fund at 1-800-231-8002.
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
Investment Policies, Portfolio Techniques and Risk Considerations......... 2
Accounting and Tax Issues................................................. 14
Performance Information................................................... 15
Trading Practices and Brokerage........................................... 20
Purchasing Shares......................................................... 22
Determining Net Asset Value............................................... 23
Redemption and Repurchase................................................. 24
Dividends and Capital Gain Distributions.................................. 26
Taxes..................................................................... 26
Investment Management Agreement........................................... 27
Officers and Directors.................................................... 32
General Information....................................................... 40
Financial Statements...................................................... 41
</TABLE>
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<PAGE>
INVESTMENT POLICIES, PORTFOLIO TECHNIQUES AND RISK CONSIDERATIONS
Investment Restrictions
The Fund has adopted the following restrictions for each of the
Portfolios (except where otherwise noted) which, along with its respective
investment objective, cannot be changed without approval by the holders of a
"majority" of the respective Portfolio'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 a
Portfolio purchases securities.
Each Portfolio shall not:
1. Make loans, except to the extent that purchases of debt obligations
(including repurchase agreements), in accordance with a Portfolio's investment
objective and policies, are considered loans, and except that each Portfolio may
loan up to 25% of its respective assets to qualified broker/dealers or
institutional investors for their use relating to short sales or other security
transactions.
2. Purchase or sell real estate or real estate limited partnerships,
but this shall not otherwise prevent a Portfolio from investing in securities
secured by real estate or interests therein, and except that The Real Estate
Investment Trust Portfolio may own real estate directly as a result of a default
on securities the Portfolio owns.
3. Engage in the underwriting of securities of other issuers, except that
in connection with the disposition of a security, a Portfolio may be deemed to
be an "underwriter" as that term is defined in the Securities Act of 1933.
4. Make any investment which would cause more than 25% of the market or
other fair value of its respective total assets to be invested in the securities
of issuers all of which conduct their principal business activities in the same
industry, except that The Defensive Equity Utility Portfolio may invest in
excess of 25% of its total assets in the securities of issuers in the utility
industry, and The Real Estate Investment Trust Portfolio may invest in excess of
25% of its total assets in the securities of issuers in the real estate
industry. This restriction does not apply to obligations issued or guaranteed
by the U.S. Government, its agencies or instrumentalities.
5. Purchase or sell commodities or commodity contracts, except that The
Aggressive Growth Portfolio, The Real Estate Investment Trust Portfolio and The
International Fixed Income Portfolio may enter into futures contracts and may
purchase and sell options on futures contracts in accordance with the
Prospectus, subject to investment restriction 6 below.
6. Enter into futures contracts or options thereon, except that The
Aggressive Growth Portfolio, The Real Estate Investment Trust Portfolio and The
International Fixed Income Portfolio may each enter into futures contracts and
options thereon to the extent that not more than 5% of its assets are required
as futures contract margin deposits and premiums on options and only to the
extent that obligations under such contracts and transactions represent not more
than 20% of its total assets.
7. Make short sales of securities, or purchase securities on margin,
except that The Aggressive Growth Portfolio, The Real Estate Investment Trust
Portfolio and The International Fixed Income Portfolio may satisfy margin
requirements with respect to futures transactions.
8. 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
either of the investment advisers if or so long as the directors and officers of
the Fund and of the investment advisers together own beneficially more than 5%
of any class of securities of such issuer.
9. Invest in interests in oil, gas and other mineral leases or other
mineral exploration or development programs.
10. Borrow money, except as a temporary measure for extraordinary
purposes or to facilitate redemptions. Any borrowing will be done from a bank
and to the extent that such borrowing exceeds 5% of the value of its respective
net assets, asset coverage of at least 300% is required. In the event that such
asset coverage shall at any time fall below 300%, a Portfolio shall, within
three days thereafter (not including Sunday or holidays) or such longer period
as the Securities and Exchange Commission ("Commission") may prescribe by rules
and
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regulations, reduce the amount of its borrowings to such an extent that the
asset coverage of such borrowings shall be at least 300%. No investment
securities will be purchased while a Portfolio has an outstanding borrowing. A
Portfolio will not pledge more than 10% of its respective net assets. A
Portfolio will not issue senior securities as defined in the Investment Company
Act of 1940 (the "1940 Act"), except for notes to banks.
In addition to the restrictions set forth above, in connection with the
qualification of a Portfolio's shares for sale in certain states, a Portfolio
may not invest in warrants if such warrants, valued at the lower of cost or
market, would exceed 5% of the value of a Portfolio's net assets. Included
within such amount, but not to exceed 2% of a Portfolio's net assets may be
warrants which are not listed on the New York Stock Exchange or American Stock
Exchange. Warrants acquired by a Portfolio in units or attached to securities
may be deemed to be without value.
Additional Fundamental Investment Restrictions
The following additional investment restrictions apply to each of the
Portfolios except The Defensive Equity Small/Mid-Cap Portfolio, The Defensive
Equity Utility Portfolio, The Labor Select International Equity Portfolio, The
Real Estate Investment Trust Portfolio, The International Fixed Income Portfolio
and The High-Yield Bond Portfolio, or as otherwise noted. They cannot be
changed without approval by the holders of a "majority" of the respective
Portfolio's outstanding shares, as described above.
Each Portfolio shall not:
1. As to 75% of its respective total assets, invest more than 5% of its
respective total assets in the securities of any one issuer (other than
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities). This restriction shall apply to only 50% of the total
assets of The Global Fixed Income Portfolio.
2. Invest in securities of other investment companies, except by purchase
in the open market involving only customary brokers' commissions or in
connection with a merger, consolidation or other acquisition or as may otherwise
be permitted by the 1940 Act.
3. Purchase more than 10% of the outstanding voting securities of any
issuer, or invest in companies for the purpose of exercising control or
management.
4. Write, purchase or sell options, puts, calls or combinations thereof
with respect to securities, except that The Aggressive Growth Portfolio may: (a)
write covered call options with respect to any or all parts of its portfolio
securities; (b) purchase call options to the extent that the premiums paid on
all outstanding call options do not exceed 2% of the Portfolio's total assets;
(c) write secured put options; and (d) purchase put options, if the Portfolio
owns the security covered by the put option at the time of purchase, and
provided that premiums paid on all put options outstanding do not exceed 2% of
its total assets. The Portfolio may sell call or put options previously
purchased and enter into closing transactions with respect to the activities
noted above.
5. Invest more than 5% of the value of its respective 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.
6. Invest more than 10% of its respective total assets in repurchase
agreements maturing in more than seven days and other illiquid assets.
For purposes of investment restriction 6, it is the Fund's policy,
changeable without shareholder vote, that "illiquid assets" include securities
of foreign issuers which are not listed on a recognized U.S. or foreign exchange
and for which a bona fide market does not exist at the time of purchase or
subsequent valuation.
The Defensive Equity Small/Mid-Cap Portfolio, The Defensive Equity Utility
Portfolio, The Labor Select International Equity Portfolio, The Real Estate
Investment Trust Portfolio, The International Fixed Income Portfolio and The
High-Yield Bond Portfolio
The following additional investment restrictions apply to The Defensive
Equity Small/Mid-Cap Portfolio, The Defensive Equity Utility Portfolio, The
Labor Select International Equity Portfolio, The Real Estate Investment Trust
Portfolio, The International Fixed Income Portfolio and The High-Yield Bond
Portfolio. Unlike the investment restrictions listed above, these are non-
fundamental investment restrictions and may be
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changed by the Fund's Board of Directors without shareholder approval.
Each of The Defensive Equity Small/Mid-Cap Portfolio, The Defensive
Equity Utility Portfolio, The Labor Select International Equity Portfolio, The
Real Estate Investment Trust Portfolio, The International Fixed Income Portfolio
and The High-Yield Bond Portfolio shall not:
1. As to 75% of its respective total assets, invest more than 5% of its
respective total assets in the securities of any one issuer (other than
obligations issued or guaranteed by the U.S. Government, its agencies or
instrumentalities). This restriction shall apply to only 50% of the total
assets of The Defensive Equity Utility Portfolio, The Real Estate Investment
Trust Portfolio and The International Fixed Income Portfolio.
2. Invest in securities of other investment companies, except by purchase
in the open market involving only customary brokers' commissions or in
connection with a merger, consolidation or other acquisition or as may otherwise
be permitted by the 1940 Act.
3. Invest more than 5% of the value of its respective total assets in
securities of companies less than three years old. Such three-year old period
shall include the operation of any predecessor company or companies. This
restriction shall not apply to The Real Estate Investment Trust Portfolio and
its investment in the securities of real estate investment trusts.
4. Purchase more than 10% of the outstanding voting securities of any
issuer, or invest in companies for the purpose of exercising control or
management.
5. Write, purchase or sell options, puts, calls or combinations thereof
with respect to securities, except that The Real Estate Investment Trust
Portfolio may: (a) write covered call options with respect to any or all parts
of its portfolio securities; (b) purchase call options to the extent that the
premiums paid on all outstanding call options do not exceed 2% of the
Portfolio's total assets; (c) write secured put options; and (d) purchase put
options, if the Portfolio owns the security covered by the put option at the
time of purchase, and provided that premiums paid on all put options outstanding
do not exceed 2% of its total assets. The Portfolio may sell call or put
options previously purchased and enter into closing transactions with respect
to the activities noted above.
6. Invest more than 15% of its respective total assets, determined at the
time of purchase, in repurchase agreements maturing in more than seven days and
other illiquid assets.
For purposes of investment restriction 6, it is the Fund's policy that
"illiquid assets" include securities of foreign issuers which are not listed on
a recognized U.S. or foreign exchange and for which no bona fide market exists
at the time of purchase.
The following information supplements the information provided in the
Fund's Prospectus.
Foreign Investment Information (The International Equity Portfolio, The
Defensive Equity Utility Portfolio, The Labor Select International Equity
Portfolio, The Real Estate Investment Trust Portfolio, The Global Fixed Income
Portfolio, The International Fixed Income Portfolio and The High-Yield Bond
Portfolio)
Investors in The International Equity Portfolio, The Labor Select
International Equity Portfolio, The Global Fixed Income Portfolio and The
International Fixed Income Portfolio (as well as in The Defensive Equity Utility
Portfolio, The Real Estate Investment Trust Portfolio, and The High-Yield Bond
Portfolio, each of which possesses a limited ability to invest in foreign
securities) should recognize that investing in securities issued by foreign
corporations and foreign governments involves certain considerations, including
those set forth in the Prospectus, which are not typically associated with
investments in United States issuers. Since the securities of foreign issuers
are frequently denominated in foreign currencies, and since each Portfolio may
temporarily hold uninvested reserves in bank deposits in foreign currencies,
these Portfolios will be affected favorably or unfavorably by changes in
currency rates and in exchange control regulations, and may incur costs in
connection with conversions between various currencies. The investment policies
of each Portfolio, except The High-Yield Bond Portfolio, permit each to enter
into forward foreign currency exchange contracts and permit The International
Fixed Income Portfolio to engage in certain options and futures activities, in
order to hedge holdings and commitments against changes in the level of future
currency rates. See "FOREIGN CURRENCY TRANSACTIONS (THE INTERNATIONAL
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<PAGE>
EQUITY PORTFOLIO, THE DEFENSIVE EQUITY UTILITY PORTFOLIO, THE LABOR SELECT
INTERNATIONAL EQUITY PORTFOLIO, THE REAL ESTATE INVESTMENT TRUST PORTFOLIO, THE
GLOBAL FIXED INCOME PORTFOLIO, AND THE INTERNATIONAL FIXED INCOME PORTFOLIO)"
below.
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 Portfolios.
Payment of such interest equalization tax, if imposed, would reduce a
Portfolio'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 a Portfolio by
United States issuers. Special rules govern the federal income tax treatment of
certain transactions denominated in terms of a currency other than the U.S.
dollar or determined by reference to the value of one or more currencies other
than the U.S. dollar. The types of transactions covered by the special rules
include, as relevant, the following: (i) the acquisition of, or becoming the
obligor under, a bond or other debt instrument (including, to the extent
provided in Treasury Regulations, preferred stock); (ii) the accruing of certain
trade receivables and payables; and (iii) the entering into or acquisition of
any forward contract and similar financial instrument if such instrument is not
"marked to market." The disposition of a currency other than the U.S. dollar by
a U.S. taxpayer is also treated as a transaction subject to the special currency
rules. With respect to transactions covered by the special rules, foreign
currency gain or loss is calculated separately from any gain or loss on the
underlying transaction and is normally taxable as ordinary gain or loss. A
taxpayer may elect to treat as capital gain or loss foreign currency gain or
loss arising from certain identified forward contracts that are capital assets
in the hands of the taxpayer and which are not part of a straddle. The Treasury
Department has authority to issue regulations under which certain transactions
subject to the special currency rules that are part of a "section 988 hedging
transaction" (as defined in the Internal Revenue Code of 1986, as amended (the
"Code"), and the Treasury Regulations) will be integrated and treated as a
single transaction or otherwise treated consistently for purposes of the Code.
Any gain or loss attributable to the foreign currency component of a transaction
engaged in by a Portfolio which is not subject to the special currency rules
(such as foreign equity investments other than certain preferred stocks) will be
treated as capital gain or loss and will not be segregated from the gain or loss
on the underlying transaction. It is anticipated that some of the non-U.S.
dollar denominated investments and foreign currency contracts the Portfolios may
make or enter into will be subject to the special currency rules described
above.
Foreign Currency Transactions (The International Equity Portfolio, The Defensive
Equity Utility Portfolio, The Labor Select International Equity Portfolio, The
Real Estate Investment Trust Portfolio, The Global Fixed Income Portfolio and
The International Fixed Income Portfolio)
The International Equity Portfolio, The Labor Select International Equity
Portfolio, The Global Fixed Income Portfolio and The International Fixed Income
Portfolio (as well as The Defensive Equity Utility Portfolio and The Real Estate
Investment Trust Portfolio, consistent with their limited ability to invest in
foreign securities) may purchase or sell currencies and/or engage in forward
foreign currency transactions in order to expedite settlement of portfolio
transactions and to minimize currency value fluctuations.
Forward foreign currency contracts are traded in the interbank market
conducted directly between currency traders (usually large commercial banks) and
their customers. A forward contract generally has no deposit requirement, and
no commissions are charged at any stage for trades. A Portfolio will account
for forward contracts by marking to market each day at daily exchange rates.
When a Portfolio enters 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 its assets denominated in
such foreign currency, The Morgan Guaranty Trust Company of New York ("Custodian
Bank") will place or will cause to be placed cash or liquid equity or debt
securities in a separate account of that Portfolio in an amount not less than
the value of that Portfolio's total assets
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<PAGE>
committed to the consummation of such forward contracts. If the additional cash
or securities placed in the separate account declines, additional cash or
securities will be placed in the account on a daily basis so that the value of
the account will equal the amount of that Portfolio's commitments with respect
to such contracts.
As noted in the Prospectus, The International Fixed Income Portfolio may
also enter into transactions involving foreign currency options, futures
contracts and options on futures contracts, in order to minimize the currency
risk in its investment portfolio.
Foreign currency options are traded in a manner substantially similar to
options on securities. In particular, an option on foreign currency provides
the holder with the right to purchase, in the case of a call option, or to sell,
in the case of a put option, a stated quantity of a particular currency for a
fixed price up to a stated expiration date. The writer of the option undertakes
the obligation to deliver, in the case of a call option, or to purchase, in the
case of a put option, the quantity of the currency called for in the option,
upon exercise of the option by the holder.
As in the case of other types of options, the holder of an option on
foreign currency is required to pay a one-time, non-refundable premium, which
represents the cost of purchasing the option. The holder can lose the entire
amount of this premium, as well as related transaction costs, but not more than
this amount. The writer of the option, in contrast, generally is required to
make initial and variation margin payments, similar to margin deposits required
in the trading of futures contacts and the writing of other types of options.
The writer is therefore subject to risk of loss beyond the amount originally
invested and above the value of the option at the time it is entered into.
Certain options on foreign currencies, like forward contracts, are traded
over-the-counter through financial institutions acting as market-makers in such
options and the underlying currencies. Such transactions therefore involve
risks not generally associated with exchange-traded instruments. Options on
foreign currencies may also be traded on national securities exchanges regulated
by the Commission or commodities exchanges regulated by the Commodity Futures
Trading Commission.
A foreign currency futures contract is a bilateral agreement providing
for the purchase and sale of a specified type and amount of a foreign currency.
By its terms, a futures contract provides for a specified settlement date on
which, in the case of the majority of foreign currency futures contracts, the
currency underlying the contract is delivered by the seller and paid for by the
purchaser, or on which, in the case of certain futures contracts, the difference
between the price at which the contract was entered into and the contract's
closing value is settled between the purchaser and seller in cash. Futures
contracts differ from options in that they are bilateral agreements, with both
the purchaser and the seller equally obligated to complete the transactions. In
addition, futures contracts call for settlement only on the expiration date, and
cannot be "exercised" at any other time during their term.
The purchase or sale of a futures contract also differs from the purchase
or sale of a security or the purchase of an option in that no purchase price is
paid or received. Instead, an amount of cash or cash equivalents, which varies
but may be as low as 5% or less of the value of the contract, must be deposited
with the broker as "initial margin" as a good faith deposit. Subsequent
payments to and from the broker referred to as "variation margin" are made on a
daily basis as the value of the currency underlying the futures contract
fluctuates, making positions in the futures contract more or less valuable, a
process known as "marking to the market."
A futures contract may be purchased or sold only on an exchange, known as
a "contract market," designated by the Commodity Futures Trading Commission for
the trading of such contract, and only through a registered futures commission
merchant which is a member of such contract market. A commission must be paid
on each completed purchase and sale transaction. The contract market
clearinghouse guarantees the performance of each party to a futures contract, by
in effect taking the opposite side of such contract. At any time prior to the
expiration of a futures contract, a trader may elect to close out its position
by taking an opposite position on the contract market on which the position was
entered into, subject to the availability of a secondary market, which will
operate to terminate the initial position. At that time, a final determination
of variation
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<PAGE>
margin is made and any loss experienced by the trader is required to be paid to
the contract market clearing house while any profit due to the trader must be
delivered to it.
A call option on a futures contract provides the holder with the right to
purchase, or enter into a "long" position in, the underlying futures contract.
A put option on a futures contract provides the holder with the right to sell,
or enter into a "short" position, in the underlying futures contract. In both
cases, the option provides for a fixed exercise price up to a stated expiration
date. Upon exercise of the option by the holder, the contract market
clearinghouse establishes a corresponding short position for the writer of the
option, in the case of a call option, or a corresponding long position in the
case of a put option and the writer delivers to the holder the accumulated
balance in the writer's margin account which represents the amount by which the
market price of the futures contract at exercise exceeds, in the case of a call,
or is less than, in the case of a put, the exercise price of the option on the
futures contract. In the event that an option written by the Portfolio is
exercised, the Portfolio will be subject to all the risks associated with the
trading of futures contracts, such as payment of variation margin deposits. In
addition, the writer of an option on a futures contract, unlike the holder, is
subject to initial and variation margin requirements on the option position.
A position in an option on a futures contract may be terminated by the
purchaser or seller prior to expiration by effecting a closing purchase or sale
transaction, subject to the availability of a liquid secondary market, which is
the purchase or sale of an option of the same series (i.e., the same exercise
price and expiration date) as the option previously purchased or sold. The
difference between the premiums paid and received represents the trader's profit
or loss on the transaction.
An option becomes worthless to the holder when it expires. Upon exercise
of an option, the exchange or contract market clearinghouse assigns exercise
notices on a random basis to those of its members which have written options of
the same series and with the same expiration date. A brokerage firm receiving
such notices then assigns them on a random basis to those of its customers which
have written options of the same series and expiration date. A writer therefore
has no control over whether an option will be exercised against it, nor over the
timing of such exercise.
Brady Bonds (The Global Fixed Income Portfolio and The International Fixed
Income Portfolio)
The Global Fixed Income Portfolio and The International Fixed Income
Portfolio may invest, within the limits specified in the Prospectus, in Brady
Bonds and other sovereign debt securities of countries that have restructured or
are in the process of restructuring sovereign debt pursuant to the Brady Plan.
Brady Bonds are debt securities issued under the framework of the Brady Plan, an
initiative announced by U.S. Treasury Secretary Nicholas F. Brady in 1989 as a
mechanism for debtor nations to restructure their outstanding external
indebtedness (generally, commercial bank debt). In restructuring its external
debt under the Brady Plan framework, a debtor nation negotiates with its
existing bank lenders as well as multilateral institutions such as the World
Bank and the International Monetary Fund (the "IMF"). The Brady Plan framework,
as it has developed, contemplates the exchange of commercial bank debt for newly
issued bonds (Brady Bonds). The World Bank and/or the IMF support the
restructuring by providing funds pursuant to loan agreements or other
arrangements which enable the debtor nation to collateralize the new Brady Bonds
or to repurchase outstanding bank debt at a discount. Under these arrangements
with the World Bank and/or the IMF, debtor nations have been required to agree
to the implementation of certain domestic monetary and fiscal reforms. Such
reforms have included the liberalization of trade and foreign investment, the
privatization of state-owned enterprises and the setting of targets for public
spending and borrowing. These policies and programs seek to promote the debtor
country's ability to service its external obligations and promote its economic
growth and development. Investors should recognize that the Brady Plan only
sets forth general guiding principles for economic reform and debt reduction,
emphasizing that solutions must be negotiated on a case-by-case basis between
debtor nations and their creditors. The investment manager believes that
economic reforms undertaken by countries in connection with
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<PAGE>
the issuance of Brady Bonds make the debt of countries which have issued or have
announced plans to issue Brady Bonds an attractive opportunity for investment.
To date, Mexico, Costa Rica, Venezuela, Uruguay and Nigeria have issued
approximately $50 billion of Brady Bonds, and Argentina, Brazil and the
Philippines have announced plans to issue approximately $90 billion, based on
current estimates, of Brady Bonds. Investors should recognize that Brady Bonds
have been issued only recently, and accordingly do not have a long payment
history. Agreements implemented under the Brady Plan to date are designed to
achieve debt and debt-service reduction through specific options negotiated by a
debtor nation with its creditors. As a result, the financial packages offered
by each country differ. The types of options have included the exchange of
outstanding commercial bank debt for bonds issued at 100% of face value of such
debt, bonds issued at a discount of face value of such debt, bonds bearing an
interest rate which increases over time and bonds issued in exchange for the
advancement of new money by existing lenders. Certain Brady Bonds have been
collateralized as to principal due at maturity by U.S. Treasury zero coupon
bonds with a maturity equal to the final maturity of such Brady Bonds, although
the collateral is not available to investors until the final maturity of the
Brady Bonds. Collateral purchases are financed by the IMF, the World Bank and
the debtor nations' reserves. In addition, the first two or three interest
payments on certain types of Brady Bonds may be collateralized by cash or
securities agreed upon by creditors.
Options on Securities, Futures Contracts and Options on Futures Contracts (The
Aggressive Growth Portfolio and The Real Estate Investment Trust Portfolio)
In order to remain fully invested, and to reduce transaction costs, The
Aggressive Growth Portfolio and The Real Estate Investment Trust Portfolio may,
to the limited extent identified in the Prospectus, use futures contracts,
options on futures contracts and options on securities and may enter into
closing transactions with respect to such activities. The Portfolios may only
enter into these transactions for hedging purposes, if it is consistent with the
Portfolios' investment objectives and policies. The Portfolios will not engage
in such transactions to the extent that obligations resulting from these
activities in the aggregate exceed 25% of the Portfolios' assets.
Options
The Aggressive Growth Portfolio and The Real Estate Investment Trust
Portfolio may purchase call options, write call options on a covered basis,
write secured put options, and purchase put options on a covered basis
only.
The Portfolios may invest in options that are either Exchange-listed or
traded over-the-counter. Certain over-the-counter options may be illiquid.
Thus, it may not be possible to close options positions and this may have an
adverse impact on the Portfolios' ability to effectively hedge their securities.
The Aggressive Growth Portfolio will not invest more than 10% of its assets in
illiquid securities, and The Real Estate Investment Trust Portfolio will not
invest more than 15% of its assets in illiquid securities.
A. Covered Call Writing--The Portfolios may write covered call options
from time to time on such portion of their securities as the investment adviser
determines is appropriate given the limited circumstances under which the
Portfolios intend to engage in this activity. A call option gives the purchaser
of such option the right to buy and the writer (in this case a Portfolio) the
obligation to sell the underlying security at the exercise price during the
option period. If the security rises in value, however, the Portfolio may not
fully participate in the market appreciation.
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 options on actual portfolio securities owned by the
Portfolios, a Portfolio may enter into closing purchase transactions. A closing
purchase transaction is one in which the Portfolio, when obligated as a writer
of an option, terminates
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<PAGE>
its obligation by purchasing an option of the same series as the option
previously written.
Consistent with the limited purposes for which the Portfolios intend to
engage in the writing of covered calls, 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 Portfolios to write another call option on
the underlying security with either a different exercise price or expiration
date or both.
The Portfolios 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, a Portfolio 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, a Portfolio 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 Portfolios will write call options only on a covered basis, which
means that the Portfolios 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 Portfolios would be required to continue to hold a
security which they might otherwise wish to sell, or deliver a security it would
want to hold. Options written by the Portfolios 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 Call Options--The Portfolios may purchase call options to
the extent that premiums paid by the Portfolios do not aggregate more than 2% of
their total assets. When a Portfolio purchases a call option, in return for a
premium paid by the Portfolio to the writer of the option, the Portfolio obtains
the right to buy the security underlying the option at a specified exercise
price at any time during the term of the option. The writer of the call option,
who receives the premium upon writing the option, has the obligation, upon
exercise of the option, to deliver the underlying security against payment of
the exercise price. The advantage of purchasing call options is that the
Portfolios may alter portfolio characteristics and modify portfolio maturities
without incurring the cost associated with portfolio transactions.
The Portfolios may, following the purchase of a call option, liquidate
their positions by effecting a closing sale transaction. This is accomplished
by selling an option of the same series as the option previously purchased. The
Portfolios will realize a profit from a closing sale transaction if the price
received on the transaction is more than the premium paid to purchase the
original call option; the Portfolios will realize a loss from a closing sale
transaction if the price received on the transaction is less than the premium
paid to purchase the original call option.
Although the Portfolios will generally purchase only those call options
for which there appears to be an active secondary market, there is no assurance
that a liquid secondary market on an Exchange will exist for any particular
option, or at any particular time, and for some options no secondary market on
an Exchange may exist. In such event, it may not be possible to effect closing
transactions in particular options, with the result that the Portfolios would
have to exercise their options in order to realize any profit and would incur
brokerage commissions upon the exercise of such options and upon the
subsequent
-9-
<PAGE>
disposition of the underlying securities acquired through the exercise of such
options. Further, unless the price of the underlying security changes
sufficiently, a call option purchased by a Portfolio may expire without any
value to the Portfolio.
C. Purchasing Put Options--The Portfolios may purchase put options to
the extent premiums paid by the Portfolios do not aggregate more than 2% of
their total assets. The Portfolios will, at all times during which they hold a
put option, own the security covered by such option.
A put option purchased by the Portfolios gives them the right to sell one
of their securities for an agreed price up to an agreed date. Consistent with
the limited purposes for which the Portfolios intend to purchase put options,
the Portfolios intend 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 a Portfolio to protect unrealized gain in an
appreciated security in its portfolio without actually selling the security. If
the security does not drop in value, the Portfolio will lose the value of the
premium paid. The Portfolio 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.
The Portfolios may sell a put option purchased on individual portfolio
securities. Additionally, the Portfolios may enter into closing sale
transactions. A closing sale transaction is one in which a Portfolio, 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.
D. Writing Put Options--A put option written by a Portfolio obligates it
to buy the security underlying the option at the exercise price during the
option period and the purchaser of the option has the right to sell the security
to the Portfolio. During the option period, the Portfolio, as writer of the put
option, may be assigned an exercise notice by the broker/dealer through whom the
option was sold requiring the Portfolio to make payment of the exercise price
against delivery of the underlying security. The obligation terminates upon
expiration of the put option or at such earlier time at which the writer effects
a closing purchase transaction. The Portfolios may write put options on a
secured basis which means that the Portfolios will maintain in a segregated
account with the Custodian Bank, cash or U.S. Government securities in an amount
not less than the exercise price of the option at all times during the option
period. The amount of cash or U.S. Government securities held in the segregated
account will be adjusted on a daily basis to reflect changes in the market value
of the securities covered by the put option written by the Portfolios.
Consistent with the limited purposes for which the Portfolios intend to engage
in the writing of put options, secured put options will generally be written in
circumstances where the investment adviser wishes to purchase the underlying
security for the Portfolios at a price lower than the current market price of
the security. In such event, a Portfolio would write a secured put option at an
exercise price which, reduced by the premium received on the option, reflects
the lower price it is willing to pay.
Following the writing of a put option, the Portfolios may wish to
terminate the obligation to buy the security underlying the option by effecting
a closing purchase transaction. This is accomplished by buying an option of the
same series as the option previously written. The Portfolios may not, however,
effect such a closing transaction after they have been notified of the exercise
of the option.
Futures and Options on Futures
Consistent with the limited circumstances under which The Aggressive
Growth Portfolio and The Real Estate Investment Trust Portfolio will use
futures, the Portfolios may enter into contracts for the purchase or sale for
future delivery of securities. While futures contracts provide for the delivery
of securities, deliveries usually do not occur. Contracts are generally
terminated by entering into an offsetting transaction. When a Portfolio enters
into a futures transaction, it must deliver to the futures commission merchant
selected by the Portfolio an amount referred to as "initial margin." This
amount is maintained by the futures commission merchant in an account at the
Portfolio's Custodian Bank. Thereafter, a "variation margin" may be paid by the
Portfolio to, or drawn by the Portfolio from, such account in accordance
-10-
<PAGE>
with controls set for such account, depending upon changes in the price of the
underlying securities subject to the futures contract.
Consistent with the limited purposes for which the Portfolios may engage
in these transactions, a Portfolio may enter into such futures contracts to
protect against the adverse effects of fluctuations in interest rates without
actually buying or selling the securities. For example, if interest rates are
expected to increase, a Portfolio might enter into futures contracts for the
sale of debt securities. Such a sale would have much the same effect as selling
an equivalent value of the debt securities owned by the Portfolio. If interest
rates did increase, the value of the debt securities in the portfolio would
decline, but the value of the futures contracts to the Portfolio would increase
at approximately the same rate, thereby keeping the net asset value of the
Portfolio from declining as much as it otherwise would have. Similarly, when it
is expected that interest rates may decline, futures contracts may be purchased
to hedge in anticipation of subsequent purchases of securities at higher prices.
Because the fluctuations in the value of futures contracts should be similar to
those of debt securities, a Portfolio could take advantage of the anticipated
rise in value of debt securities without actually buying them until the market
had stabilized. At that time, the futures contracts could be liquidated and the
Portfolio could then buy debt securities on the cash market.
With respect to options on futures contracts, when a Portfolio is not
fully invested, it may purchase a call option on a futures contract to hedge
against a market advance due to declining interest rates. The purchase of a
call option on a futures contract is similar in some respects to the purchase of
a call option on an individual security. Depending on the pricing of the option
compared to either the price of the futures contract upon which it is based, or
the price of the underlying debt securities, it may or may not be less risky
than ownership of the futures contract or underlying debt securities.
The writing of a call option on a futures contract constitutes a partial
hedge against the declining price of the security which is deliverable upon
exercise of the futures contract. If the futures price at the expiration of the
option is below the exercise price, the Portfolio will retain the full amount of
the option premium which provides a partial hedge against any decline that may
have occurred in the Portfolio's holdings. The writing of a put option on a
futures contract constitutes a partial hedge against the increasing price of the
security which is deliverable upon exercise of the futures contract. If the
futures price at the expiration of the option is higher than the exercise price,
the Portfolio will retain the full amount of option premium which provides a
partial hedge against any increase in the price of securities which the
Portfolio intends to purchase.
If a put or call option that a Portfolio has written is exercised, the
Portfolio will incur a loss which will be reduced by the amount of the premium
it receives. Depending on the degree of correlation between changes in the
value of its portfolio securities and changes in the value of its futures
positions, a Portfolio's losses from existing options on futures may, to some
extent, be reduced or increased by changes in the value of portfolio securities.
The purchase of a put option on a futures contract is similar in some respects
to the purchase of protective puts on portfolio securities. For example,
consistent with the limited purposes for which the Portfolios will engage in
these activities, a Portfolio will purchase a put option on a futures contract
to hedge the Portfolio's securities against the risk of rising interest
rates.
To the extent that interest rates move in an unexpected direction, the
Portfolios may not achieve the anticipated benefits of futures contracts or
options on futures contracts or may realize a loss. For example, if a Portfolio
is hedged against the possibility of an increase in interest rates which would
adversely affect the price of securities held in its portfolio and interest
rates decrease instead, the Portfolio will lose part or all of the benefit of
the increased value of its securities which it has because it will have
offsetting losses in its futures position. In addition, in such situations, if
the Portfolio had insufficient cash, it may be required to sell securities from
its portfolio to meet daily variation margin requirements. Such sales of
securities may, but will not necessarily, be at increased prices which reflect
the rising market. The Portfolios may be required to sell securities at a time
when it may be disadvantageous to do so.
Further, with respect to options on futures contracts, the Portfolios may
seek to close out an
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<PAGE>
option position by writing or buying an offsetting position covering the same
securities or contracts and have the same exercise price and expiration date.
The ability to establish and close out positions on options will be subject to
the maintenance of a liquid secondary market, which cannot be assured.
* * *
From time to time, the Portfolios may also, as noted below, engage in the
following investment techniques:
Asset-Backed Securities (The Fixed Income Portfolio and The Limited-Term
Maturity Portfolio)
The Fixed Income and The Limited-Term Portfolios may invest a portion of
their assets in asset-backed securities. The rate of principal payment on
asset-backed securities generally depends on the rate of principal payments
received on the underlying assets. Such rate of payments may be affected by
economic and various other factors such as changes in interest rates.
Therefore, the yield may be difficult to predict and actual yield to maturity
may be more or less than the anticipated yield to maturity. The credit quality
of most asset-backed securities depends primarily on the credit quality of the
assets underlying such securities, how well the entities issuing the securities
are insulated from the credit risk of the originator or affiliated entities, and
the amount of credit support provided to the securities.
Asset-backed securities are often backed by a pool of assets representing
the obligations of a number of different parties. To lessen the effect of
failures by obligors on underlying assets to make payments, such securities may
contain elements of credit support. Such credit support falls into two
categories: (i) liquidity protection, and (ii) protection against losses
resulting from ultimate default by an obligor on the underlying assets.
Liquidity protection refers to the provision of advances, generally by the
entity administering the pool of assets, to ensure that the receipt of payments
due on the underlying pool is timely. Protection against losses resulting from
ultimate default enhances the likelihood of payments of the obligations on at
least some of the assets in the pool. Such protection may be provided through
guarantees, insurance policies or letters of credit obtained by the issuer or
sponsor from third parties, through various means of structuring the transaction
or through a combination of such approaches. The Portfolios will not pay any
additional fees for such credit support, although the existence of credit
support may increase the price of a security.
Examples of credit support arising out of the structure of the
transaction include "senior-subordinated securities" (multiple class securities
with one or more classes subordinate to other classes as to the payment of
principal thereof and interest thereon, with the result that defaults on the
underlying assets are borne first by the holders of the subordinated class),
creation of "reserve funds" (where cash or investments, sometimes funded from a
portion of the payments on the underlying assets, are held in reserve against
future losses) and "over collateralization" (where the scheduled payments on, or
the principal amount of, the underlying assets exceeds that required to make
payments of the securities and pay any servicing or other fees). The degree of
credit support provided for each issue is generally based on historical
information respecting the level of credit risk associated with the underlying
assets. Delinquencies or losses in excess of those anticipated could adversely
affect the return on an investment in such issue.
Repurchase Agreements
While each Portfolio is permitted to do so, it normally does not invest
in repurchase agreements, except to invest cash balances or for temporary
defensive purposes.
The funds in the Delaware Group, including the Fund, have obtained an
exemption from the joint-transaction prohibitions of Section 17(d) of the 1940
Act to allow the Delaware Group funds jointly to invest cash balances. Each
Portfolio 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 a Portfolio, if any,
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<PAGE>
would be the difference between the repurchase price and the market value of the
security. Each Portfolio will limit its investments in repurchase agreements to
those which its respective investment adviser, under the guidelines of the Board
of Directors, determines to present minimal credit risks and which are of high
quality. In addition, a Portfolio must have collateral of at least 100% of the
repurchase price, including the portion representing the Portfolio's yield under
such agreements which is monitored on a daily basis.
Portfolio Loan Transactions
Each Portfolio 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 Fund that the staff of the 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 a Portfolio; 3) a Portfolio must be able to terminate the loan
after notice, at any time; 4) a Portfolio 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) a
Portfolio 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 Board of 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 a Portfolio 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, a Portfolio will only enter into loan
arrangements after a review of all pertinent facts by the respective investment
adviser, 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 respective
investment adviser.
Rule 144A Securities
Each Portfolio 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 Securities are traded
among qualified institutional investors. While maintaining oversight, the Board
of Directors has delegated to the respective investment adviser the day-to-day
function of determining whether or not individual Rule 144A Securities are
liquid for purposes of each Portfolio's limitation (whether 15% or 10% of total
assets) on investments in illiquid assets. The Board has instructed the
respective investment adviser 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 other potential purchasers;
(iii) whether at least two dealers are making a market in the security; and (iv)
the nature of the security and the nature of the marketplace trades (e.g., the
time needed to dispose of the security, the method of soliciting offers, and the
mechanics of transfer).
Investing in Rule 144A Securities could have the effect of increasing the
level of a Portfolio'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
respective investment adviser will continue to monitor the liquidity of that
security to ensure that a Portfolio has no more than 10% or 15%, as appropriate,
of its total assets in illiquid securities.
-13-
<PAGE>
ACCOUNTING AND TAX ISSUES
When The Aggressive Growth Portfolio, The Real Estate Investment Trust
Portfolio and The International Fixed Income Portfolio 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 Portfolio'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 ask prices. If an option which a Portfolio has written
expires on its stipulated expiration date, the Portfolio recognizes a short-term
capital gain. If a Portfolio enters into a closing purchase transaction with
respect to an option which the Portfolio has written, the Portfolio realizes a
short-term 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. If a call option which a Portfolio has written is exercised, the
Portfolio realizes a capital gain or loss from the sale of the underlying
security on foreign currency and the proceeds from such sale are increased by
the premium originally received.
The premium paid by a Portfolio for the purchase of a put option is
reported in the section of the Portfolio'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 ask prices. If an option
which the Portfolio has purchased expires on the stipulated expiration date, the
Portfolio 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 Portfolio 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.
Other Tax Requirements
Each Portfolio has qualified or intends to qualify, and each that has
qualified intends to continue to qualify, as a regulated investment company
under Subchapter M of the Code. Accordingly, a Portfolio will not be subject to
federal income tax to the extent its earnings are distributed. Each Portfolio
must meet several requirements to maintain its status as a regulated investment
company. Among these requirements are: (i) 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 or
foreign currencies, or other income derived with respect to its business of
investing in such securities or currencies; (ii) that at the close of each
quarter of its taxable year at least 50% of the value of its assets consist of
cash and cash items, government securities, securities of other regulated
investment companies and, subject to certain diversification requirements, other
securities, and, with respect to its remaining assets, no more than 25% of the
value of such assets is invested in the securities (other than U.S. Government
securities and securities of other regulated investment companies) of any one
issuer, or of two or more issuers which are controlled by a Portfolio and which
are engaged in the same or similar trades or businesses; and (iii) that less
than 30% of its gross income be derived from sales of securities held for less
than three months.
The requirement that not more than 30% of gross income be derived from
gains from the sale or other disposition of securities held for less than three
months may restrict The Aggressive Growth Portfolio and The Real Estate
Investment Trust Portfolio in their ability to write covered call options on
securities which they have 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
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<PAGE>
realizing a gain within the three-month period, the Portfolios may be required
to defer the closing out of a contract beyond the time when it might otherwise
be advantageous to do so. The Portfolios 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.
PERFORMANCE INFORMATION
From time to time, the Fund may state each Portfolio's total return in
advertisements and other types of literature. Any statements of total return
performance data will be accompanied by information on the Portfolio's average
annual total rate of return over the most recent one-, five-, and ten-year
periods, as relevant. The Fund may also advertise aggregate and average total
return information of each Portfolio over additional periods of time.
Each Portfolio's average annual total rate of return is based on a
hypothetical $1,000 investment that includes capital appreciation and
depreciation during the stated periods. The following formula will be used for
the actual computations:
n
P(1+T) = ERV
Where: P = a hypothetical initial purchase
order of $1,000;
T = average annual total return;
n = number of years;
ERV = redeemable value of the
hypothetical $1,000 purchase at
the end of the period.
Aggregate or cumulative total return is calculated in a similar manner,
except that the results are not annualized. Each calculation assumes that all
distributions are reinvested at net asset value.
The performance of the Portfolios, as shown below, is the average annual
total return quotations for the one- and three-year periods ended April 30, 1995
and for the life of The Defensive Equity, The Aggressive Growth and The
International Equity Portfolios and for the one-year period ended April 30, 1995
and for the life of The Global Fixed Income Portfolio computed as described
above. Securities prices fluctuated during the period covered and the past
results should not be considered as representative of future performance.
Average Annual Total Return(1)
<TABLE>
<CAPTION>
The The The
Defensive Aggressive International
Equity Growth Equity
Portfolio Portfolio Portfolio
<S> <C> <C>
1 year 1 year 1 year
ended ended ended
4/30/95 4/30/95 4/30/95
15.42% 5.10% 2.55%
3 years 3 years 3 years
ended ended ended
4/30/95 4/30/95 4/30/95
14.17% 9.35% 10.95%
Period Period Period
2/3/92(2) 2/27/92(2) 2/4/92(2)
through through through
4/30/95 4/30/95 4/30/95
15.03% 5.41% 10.68%
</TABLE>
-15-
<PAGE>
<TABLE>
<CAPTION>
<S> <C>
The
Global
Fixed
Income
Portfolio
1 year
ended
4/30/95
5.18%
Period
11/30/92(2)
through
4/30/95
10.06%
</TABLE>
(1) Certain expenses of the Portfolios have been waived and reimbursed by the
respective investment manager. In the absence of such waiver and reimbursement,
performance would have been affected negatively.
(2) Date of initial sale.
The Fund may also quote each Portfolio's current yield, calculated as
described below, in advertisements and investor communications.
The yield computation is determined by dividing the net investment income
per share earned during the period by the maximum offering price per share on
the last day of the period and annualizing the resulting figure, according to
the following formula:
a - b
------ 6
YIELD = 2[(cd + 1) - 1]
Where: a = dividends and interest earned during
the period;
b = expenses accrued for the period (net
of reimbursements);
c = the average daily number of shares
outstanding during the period that
were entitled to receive dividends;
d = the maximum offering price per
share on the last day of the period.
The above formula will be used in calculating quotations of yield, based
on specific 30-day periods identified in advertising by the Portfolio. Yield
quotations are based on the Portfolio's net asset value on the last day of the
period and will fluctuate depending on the period covered. The yield of The
Global Fixed Income Portfolio, as of April 30, 1995, was 9.38%, reflecting the
waiver and reimbursement commitment by its investment adviser.
Investors should note that income earned and dividends paid by The Fixed
Income Portfolio, The Limited-Term Maturity Portfolio, The Global Fixed Income
Portfolio, The International Fixed Income Portfolio and The High-Yield Bond
Portfolio will also vary depending upon fluctuation in interest rates and
performance of each Portfolio. The net asset value of these five Portfolios will
fluctuate in value inversely to movements in interest rates and, therefore, will
tend to rise when interest rates fall and fall when interest rates rise.
Likewise, the net asset value for these Portfolios will vary from day to day
depending upon fluctuation in the prices of the securities held by each
Portfolio. Thus, investors should consider net asset value fluctuation as well
as yield in making an investment decision.
Each Portfolio's total return performance 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 net asset value
at the beginning of the period. The computation will not reflect the impact of
any income taxes payable by shareholders (who are subject to such tax) on the
reinvested distributions included in the calculation. Portfolio shares are sold
without a sales charge. Because security prices fluctuate, past performance
should not be considered as a representation of the results which may be
realized from an investment in the Portfolios in the future.
From time to time, performance of each Portfolio in the Fund may be
compared to various industry indices. For example, the Fund may quote actual
total return performance, dividend results and other performance information of
The Defensive Equity Portfolio, that invests primarily in domestic equities, 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 and the Dow
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<PAGE>
Jones Industrial Average, and other unmanaged indices. The Standard & Poor's
500 Stock Index and the Dow Jones Industrial Average are industry-accepted
unmanaged indices of generally-conservative securities used for measuring
general market performance. The total return performance reported will reflect
the reinvestment of all distributions on a quarterly basis and market price
fluctuations. The indices do not take into account any management expenses or
other fees. In seeking a particular investment objective, the Portfolios that
invest primarily in equities may include common stocks considered by the
investment adviser to be more aggressive than those tracked by these indices.
From time to time, the Fund may quote actual total return and/or yield
performance for each Portfolio 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.
Current interest rate and yield information on government debt
obligations of various durations, as reported weekly by the Federal Reserve
(Bulletin H.15), may also be used. Current industry rate and yield information
on all industry available fixed income securities, as reported weekly by the
Bond Buyer, may also be used in preparing comparative illustrations. In
addition, the Consumer Price Index, the most commonly used measure of inflation,
may be used in preparing performance comparisons. The Consumer Price Index, as
prepared by the U.S. Bureau of Labor Statistics, indicates the cost fluctuations
of a representative group of consumer goods. It does not represent a return
from an investment.
Statistical and/or 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 to comparable Fund activity
and performance:
CDA Technologies, Inc. is a performance evaluation service that maintains a
statistical database of performance, 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 industry indicators, such as historical and current
price/earnings information and individual equity and fixed income price and
return information.
Compustat Industrial Databases, a service of Standard & Poor's Corporation,
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.
Morgan Stanley Capital International is a research firm that maintains a
statistical database of international securities. It also compiles and
maintains a number of unmanaged indices of international securities. These
indices are designed to measure the performance of the stock markets outside
of the USA. Primary coverage of Europe, Canada, Mexico, Australia and the Far
Eastern markets, and that of international industry groups are included.
-17-
<PAGE>
Lehman Brothers is a statistical research firm that maintains databases of
U.S. and international bond markets and corporate and government-backed
securities of various maturities. This information, as well as unmanaged
indices compiled and maintained by Lehman Brothers, will be used in preparing
comparative illustrations.
Wellesley Group Inc. is an investment management consulting firm specializing
in investment and market research for endowments and pension plans. Wellesley
Group will be maintaining, on behalf of the Fund, peer group comparison
composites for each Portfolio of the Fund. The peer group composites will be
constructed by selecting publicly-offered mutual funds that have investment
objectives that are similar to those maintained by each Portfolio in the
Fund. Wellesley Group will also be preparing performance analyses of actual
Fund performance, and benchmark index exhibits, for inclusion in client
quarterly review packages.
FT-Actuaries World Indices are jointly compiled by The Financial Times, Ltd.;
Goldman, Sachs & Co.; and Wood Mackenzie & Co., Ltd. in conjunction with the
Institute of Actuaries and the Faculty of Actuaries. Indices maintained by
this group primarily focus on compiling statistical information on
international financial markets and industry sectors, stock and bond issues
and certain fundamental information about the companies issuing the
securities. Statistical information on international currencies is also
maintained.
The Fund may also promote each Portfolio's yield and/or total return
performance and use comparative performance information computed by and
available from certain industry and general market research publications, such
as Lipper Analytical Services, Inc.
The following table is an example, for purposes of illustration only, of
cumulative total return performance for The Defensive Equity, The Aggressive
Growth, The International Equity and The Global Fixed Income Portfolios for the
three-, six- and nine-month periods ended April 30, 1995, for the one- and
three-year periods ended April 30, 1995 and for the life of The Defensive
Equity, The Aggressive Growth and The International Equity Portfolios.
Cumulative total return is provided for the three-, six- and nine-month periods
ended April 30, 1995, the one-year period ended April 30, 1995 and for the life
of The Global Fixed Income Portfolio. For these purposes, the calculations
assume the reinvestment of any capital gains distributions and income dividends
paid during the indicated periods. Comparative information on the Dow Jones
Industrial Average, the Standard & Poor's 500 Stock Index (the "S&P 500 Index")
and the Consumer Price Index, the Wilshire Mid-Cap Index, the Morgan Stanley
Europe, Australia and Far East (EAFE) Index and the Salomon World Government
Bond Index, where applicable, is also included.
<TABLE>
<CAPTION>
Cumulative Total Return(1)
The
Defensive Dow S&P
Equity Jones 500
Portfolio Industrial Index
<S> <C> <C> <C>
3 months
ended
4/30/95 10.03% 13.17% 10.11%
6 months
ended
4/30/95 8.47% 12.11% 10.44%
9 months
ended
4/30/95 10.84% 17.23% 14.67%
1 year
ended
4/30/95 15.42% 20.70% 17.40%
3 years
ended
4/30/95 48.80% 40.18% 35.02%
Period
2/3/92(2)
through
4/30/95 57.44% 46.63% 36.33%
</TABLE>
-18-
<PAGE>
<TABLE>
<CAPTION>
The
Aggressive Wilshire
Growth Mid-Cap
Portfolio Growth
<S> <C> <C>
3 months
ended
4/30/95 6.71% 11.55%
6 months
ended
4/30/95 5.01% 8.39%
9 months
ended
4/30/95 11.59% 19.58%
1 year
ended
4/30/95 5.10% 14.55%
3 years
ended
4/30/95 30.75% 49.07%
Period
2/27/92(2)
through
4/30/95 18.20% 39.72%
</TABLE>
<TABLE>
<CAPTION>
The
International S&P
Equity 500
Portfolio EAFE Index
<S> <C> <C> <C>
3 months
ended
4/30/95 6.49% 9.92% 10.11%
6 months
ended
4/30/95 (0.51%) 1.24% 10.44%
9 months
ended
4/30/95 1.74% 3.72% 14.67%
1 year
ended
4/30/95 2.55% 5.59% 17.40%
3 years
ended
4/30/95 36.56% 49.78% 35.02%
Period
2/4/92(2)
through
4/30/95 38.89% 35.52% 36.33%
</TABLE>
<TABLE>
<CAPTION>
The Salomon
Global Fixed World
Income Gov't
Portfolio Bond
<S> <C> <C>
3 months
ended
4/30/95 3.48% 10.66%
6 months
ended
4/30/95 5.28% 11.74%
9 months
ended
4/30/95 8.13% 13.96%
1 year
ended
4/30/95 5.18% 15.50%
Period
11/30/92(2)
through
4/30/95 26.07% 31.76%
</TABLE>
(1) Certain expenses of the Portfolios have been waived and reimbursed by the
respective investment manager. In the absence of such waiver and reimbursement,
performance would have been affected negatively.
(2) Date of initial sale.
In addition, information will be provided that discusses the overriding
investment philosophies of Delaware Investment Advisers, a division of Delaware
Management Company, Inc. ("Delaware"), the investment adviser to The Defensive
Equity, The Aggressive Growth, The Defensive Equity Small/Mid-Cap, The Defensive
Equity Utility, The Real Estate Investment Trust, The Fixed Income, The Limited-
Term Maturity, and The High-Yield Bond Portfolios, and Delaware International
Advisers Ltd. ("Delaware International"), an affiliate of Delaware and the
investment adviser to The International Equity, The Labor Select International
Equity, The Global Fixed Income and The International Fixed Income Portfolios
and how those philosophies impact each Portfolio in the strategies the Fund
employs in seeking Portfolio objectives. Since the investment disciplines being
employed for each Portfolio in the Fund are based on the disciplines and
strategies employed by Delaware and Delaware International to manage
institutional separate accounts, investment
-19-
<PAGE>
strategies and disciplines of these entities may also be discussed.
The Defensive Equity Portfolio's strategy relies on the consistency,
reliability and predictability of corporate dividends. Dividends tend to rise
over time, despite market conditions, and keep pace with rising prices; they are
paid out in "current" dollars. Just as important, current dividend income can
help lessen the effects of adverse market conditions. This equity dividend
discipline, coupled with the potential for capital gains, seeks to provide
investors with a consistently higher total-rate-of-return over time. In
implementing this strategy, the investment adviser seeks to buy securities with
a yield higher than the average of the S&P 500 Index. If a security held by the
Portfolio moves out of the acceptable yield range, it typically is sold. This
strict buy/sell discipline is instrumental in implementing The Defensive Equity
Portfolio strategy.
THE POWER OF COMPOUNDING
When you opt to reinvest your current income for additional Portfolio
shares, your investment is given yet another opportunity to grow. It's called
the Power of Compounding.
Typically, results of various assumed fixed rates of return on a $10,000
investment compounded monthly for ten years will be used.
These figures will be calculated assuming a fixed constant investment
return and assume no fluctuation in the value of principal. These figures will
not reflect payment of applicable taxes and are not intended to be a projection
of future results.
TRADING PRACTICES AND BROKERAGE
The Fund (and, in the case of The International Equity, The Labor Select
International Equity, The Global Fixed Income and The International Fixed Income
Portfolios, their investment adviser) 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
securities either are purchased directly from the dealer or are sold 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 (and, in the case of The International Equity, The Labor Select
International Equity, The Global Fixed Income and The International Fixed Income
Portfolios, their investment adviser) 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 period ended October 31, 1992, the aggregate dollar amounts of
brokerage commissions paid by The Defensive Equity, The Aggressive Growth and
The International Equity Portfolios amounted to $6,449, $7,368 and $529,
respectively. During the fiscal years ended October 31, 1993 and 1994, such
payments by the above Portfolios amounted to $14,686 and $59,381, respectively,
$32,320 and $19,391, respectively, and $10,651 and $94,890, respectively.
During the period ended October 31, 1993 and for the fiscal year ended October
31, 1994, such payments by The Global Fixed Income Portfolio amounted to $4,595
and $12,391, respectively.
The investment advisers may allocate out of all commission business
generated by all of the funds and accounts under management by them, 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
-20-
<PAGE>
analyses; and providing portfolio performance evaluation and technical market
analyses. Such services are used by the investment advisers in connection with
their investment decision-making process with respect to one or more funds and
accounts they manage, and may not be used, or used exclusively, with respect to
the fund or account generating the brokerage.
During the fiscal year ended October 31, 1994, portfolio transactions of
The Defensive Equity, The Aggressive Growth, The International Equity and The
Global Fixed Income Portfolios in the amounts of $21,242,187, $5,579,279,
$19,907,505 and $10,470,688, respectively, resulting in brokerage commissions of
$34,791, $14,488, $69,280 and $12,874, respectively, were directed to brokers
for brokerage and research services provided.
As provided in the Securities Exchange Act of 1934 and each Portfolio'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 investment advisers which constitute in some part brokerage and research
services used by the investment advisers in connection with their investment
decision-making process and constitute in some part services used by them in
connection with administrative or other functions not related to their
investment decision-making process. In such cases, the investment advisers will
make a good faith allocation of brokerage and research services and will pay out
of their own resources for services used by them in connection with
administrative or other functions not related to their 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.
Combined orders for two or more accounts or funds engaged in the purchase
or sale of the same security may be placed if the judgment is made that 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 investment advisers 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., and subject to seeking best price and execution,
orders may be placed with broker/dealers that have agreed to defray certain
Portfolio expenses, such as custodian fees.
Portfolio Turnover
Portfolio trading will be undertaken principally to accomplish each
Portfolio's objective in relation to anticipated movements in the general level
of interest rates. A Portfolio is free to dispose of portfolio securities at any
time, subject to complying with the Code and the 1940 Act, when changes in
circumstances or conditions make such a move desirable in light of the
investment objective. A Portfolio will not attempt to achieve or be limited to
a predetermined rate of portfolio turnover. Such a turnover always will be
incidental to transactions undertaken with a view to achieving a Portfolio's
investment objective.
The degree of portfolio activity may affect brokerage costs of a
Portfolio and taxes payable by
-21-
<PAGE>
a Portfolio's shareholders. A turnover rate of 100% would occur, for example,
if all the investments in a Portfolio's securities at the beginning of the year
were replaced by the end of the year. In investing for capital appreciation, a
relevant Portfolio may hold securities for any period of time. Portfolio
turnover will also be increased by The Aggressive Growth Portfolio and The Real
Estate Investment Trust Equity Portfolio if the Portfolio writes a large number
of call options which are subsequently exercised. To the extent a Portfolio
realizes gains on securities held for less than six months, such gains are
taxable to the shareholder subject to tax or to a Portfolio at ordinary income
tax rates. The turnover rate also may be affected by cash requirements from
redemptions and repurchases of Portfolio shares. Total brokerage costs
generally increase with higher portfolio turnover rates.
Under normal circumstances: (1) the annual portfolio turnover rate of The
International Equity Portfolio is not expected to exceed 50%; (2) the annual
portfolio turnover rate of The Global Fixed Income Portfolio, The International
Fixed Income Portfolio and The Limited-Term Maturity Portfolio is not expected
to exceed 200%; (3) the annual portfolio turnover rate of The Defensive Equity
Portfolio, The Aggressive Growth Portfolio, The Defensive Equity Small/Mid-Cap
Portfolio, The Defensive Equity Utility Portfolio, The Labor Select
International Equity Portfolio, The Real Estate Investment Trust Portfolio, and
The High-Yield Bond Portfolio is not expected to exceed 100%; and (4) the annual
portfolio turnover rate of The Fixed Income Portfolio is not expected to exceed
250%. The portfolio turnover rate of a Portfolio is calculated by dividing the
lesser of purchases or sales of securities for the particular fiscal year by the
monthly average of the value of the securities owned by the Portfolio during the
particular fiscal year, exclusive of securities whose maturities at the time of
acquisition are one year or less.
The portfolio turnover rates for the fiscal years ended October 31, 1993
and 1994 were 37% and 73%, respectively, for The Defensive Equity Portfolio, 81%
and 43%, respectively, for The Aggressive Growth Portfolio and 28% and 22%,
respectively, for The International Equity Portfolio. For the period November
30, 1992 (date of initial sale) to October 30, 1993, The Global Fixed Income
Portfolio's annualized portfolio turnover rate was 198% and for the fiscal year
ended October 31, 1994, the portfolio turnover rate was 205%. The portfolio
turnover rates experienced by The Global Fixed Income Portfolio for the periods
ended October 31, 1993 and 1994 were the result of unusual volatility in the
European markets following the breakdown of the prevailing European exchange
rate mechanism, the implementation of an investment strategy designed to avoid
certain foreign withholding taxes and management's shift in country exposure
following modification of the composition of a benchmark index.
PURCHASING SHARES
The following supplements the disclosure provided in the Fund's
Prospectus.
Shares of each Portfolio are sold on a continuous basis directly to
institutional investors at the net asset value next determined after the receipt
of a purchase order and a Federal Funds wire as described more fully in the
Prospectus. See "DETERMINING NET ASSET VALUE." The minimum for initial
investments is $1,000,000 for each Portfolio. There are no minimums for
subsequent investments. See the Prospectus for special purchase procedures and
requirements that may be applicable to prospective investors in The
International Equity Portfolio and The Labor Select International Equity
Portfolio. At such time as the Fund receives appropriate regulatory approval to
do so in the future, under certain circumstances, the Fund may, at its sole
discretion, allow institutional investors who have an investment counseling
relationship with Delaware Investment Advisers or Delaware International to make
investments in the Portfolios by a contribution of securities in-kind to such
Portfolios.
Delaware Distributors, Inc. serves as the national distributor for each
Portfolio's shares. See the Prospectus for information on how to invest. The
Fund reserves the right to suspend sales of Portfolio shares, and reject any
order for the purchase of Portfolio shares if in the opinion of management such
rejection is in the Portfolio's best interest.
Certificates representing shares purchased are not ordinarily issued.
However, such purchases are confirmed to the investor and credited to the
shareholder's account on the books maintained on
-22-
<PAGE>
behalf of the Fund. The investor will have the same rights of ownership with
respect to such shares as if certificates had been issued. An investor may
receive a certificate representing shares purchased by sending a letter to the
Fund requesting the certificate. No charge is made for any certificate issued.
Investors who hold certificates representing any of their shares may only redeem
these shares by written requests.
DETERMINING NET ASSET VALUE
Orders for purchases of shares of a Portfolio are effected at the net
asset value of that Portfolio next calculated after receipt of the order by the
Fund and Federal Funds wire by the Custodian Bank.
Net asset value is computed at the close of regular trading on the New
York Stock Exchange, generally 4 p.m., Eastern time, on days when the New York
Stock Exchange is open and an order to purchase or sell shares of a Portfolio
has been received or is on hand, having been received since the last previous
computation of net asset value. 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.
The net asset value per share of each Portfolio is determined by dividing
the total market value of the Portfolio's investments and other assets, less any
liabilities, by the total outstanding shares of the Portfolio. Securities listed
on a U.S. securities exchange for which market quotations are available are
valued at the last quoted sale price on the day the valuation is made. Price
information on listed securities is taken from the exchange where the security
is primarily traded. Securities listed on a foreign exchange are valued at the
last quoted sale price available before the time when net assets are valued.
Unlisted securities and listed securities not traded on the valuation date for
which market quotations are readily available are valued at a price that is
considered to best represent fair value within a range not in excess of the
current ask prices nor less than the current bid prices. Domestic over-the-
counter equities, domestic equity securities that are not traded and U.S.
Government securities (and those of its agencies and instrumentalities) are
priced at the mean of the bid and ask price.
Bonds and other fixed income securities are valued according to the
broadest and most representative market, which will ordinarily be the over-the-
counter market. Net asset value includes interest on fixed income securities,
which is accrued daily. In addition, bonds and other fixed income securities
may be valued on the basis of prices provided by a pricing service when such
prices are believed to reflect the fair market value of such securities. The
prices provided by a pricing service are determined without regard to bid or
last sale prices but take into account institutional size trading in similar
groups of securities and any developments related to the specific securities.
Securities not priced in this manner are valued at the most recent quoted mean
price or, when stock exchange valuations are used, at the latest quoted sale
price on the day of valuation. If there is no such reported sale, the latest
quoted mean price will be used. Securities with remaining maturities of 60 days
or less are valued at amortized cost, if it approximates market value. In the
event that amortized cost does not approximate market value, market prices as
determined above will be used.
Exchange-traded options are valued at the last reported sales price or,
if no sales are reported, at the mean between the last reported bid and ask
prices. Non-exchange traded options are valued at fair value using a
mathematical model. Futures contracts are valued at their daily quoted
settlement price. The value of other assets and securities for which no
quotations are readily available (including restricted securities) are
determined in good faith at fair value using methods determined by the Fund's
Board of Directors.
The securities in which The International Equity Portfolio, The Labor
Select International Equity Portfolio, The Global Fixed Income Portfolio and The
International Fixed Income Portfolio (as well as The Defensive Equity Utility
Portfolio, The Real Estate Investment Trust Portfolio and The High-Yield Bond
Portfolio, to the limited extent described in the Prospectus) may invest from
time to time may be listed primarily on foreign exchanges which trade on days
when the New York
-23-
<PAGE>
Stock Exchange is closed (such as Saturday). As a result, the net asset value
of those Portfolios may be significantly affected by such trading on days when
shareholders have no access to the Portfolios.
For purposes of calculating net asset value per share, all assets and
liabilities initially expressed in foreign currencies will be converted into
U.S. dollars at the mean between the bid and ask prices of such currencies
against the U.S. dollar as provided by an independent pricing service or any
major bank, including the Custodian Bank. Forward foreign currency contracts
are valued at the mean price of the contract. Interpolated values will be
derived when the settlement date of the contract is on an interim period for
which quotations are not available.
REDEMPTION AND REPURCHASE
The following supplements the disclosure provided in the Fund's
Prospectus.
Each Portfolio may suspend redemption privileges or postpone the date of
payment (i) during any period that the New York Stock Exchange is closed, or
trading on the New York Stock Exchange is restricted as determined by the
Commission, (ii) during any period when an emergency exists as defined by the
rules of the Commission as a result of which it is not reasonably practicable
for a Portfolio to dispose of securities owned by it, or fairly to determine the
value of its assets, and (iii) for such other periods as the Commission may
permit.
No charge is made by any Portfolio for redemptions. Payment for shares
redeemed or repurchased may be made either in cash or in-kind, or partly in cash
and partly in-kind. Any portfolio securities paid or distributed in-kind would
be valued as described in "DETERMINING NET ASSET VALUE." Subsequent sales by an
investor receiving a distribution in-kind could result in the payment of
brokerage commissions. Payment for shares redeemed ordinarily will be made
within three business days, but in no case later than seven days, after receipt
of a redemption request in good order. See "REDEMPTION OF SHARES" in the
Prospectus for special redemption procedures and requirements that may be
applicable to shareholders in The International Equity Portfolio, The Labor
Select International Equity Portfolio, The Global Fixed Income Portfolio and The
International Fixed Income Portfolio. Institutional investors who have an
existing investment counseling relationship with Delaware Investment Advisers or
Delaware International will not be subject to the Fund's in-kind redemption
requirements until such time as the Fund receives appropriate regulatory
approvals to permit such redemptions for the account of such institutional
investors.
The Fund has elected to be governed by Rule 18f-1 under the 1940 Act
pursuant to which the Fund is obligated to redeem shares solely in cash up to
the lesser of $250,000 or 1% of the net asset value of each Portfolio during any
90-day period for any one shareholder.
The value of a Portfolio's investments is subject to changing market
prices. Redemption proceeds may be more or less than the shareholder's cost
depending upon the market value of the Portfolio's securities. Thus, a
shareholder redeeming shares of a Portfolio may, if such shareholder is subject
to federal income tax, sustain either a gain or loss, depending upon the price
paid and the price received for such shares.
Smaller Accounts
Due to the relatively higher cost of maintaining small accounts, the Fund
reserves the right to redeem Portfolio shares in any of its accounts at the
then-current net asset value if as a result of redemption or transfer a
shareholder's investment in a Portfolio has a value of less than $500,000.
However, before the Fund redeems such shares 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 $500,000 and will be allowed 90 days from
that date of notice to make an additional investment to meet the required
minimum. Any redemption in an inactive account established with a minimum
investment may trigger mandatory redemption.
Expedited Telephone Redemptions
The Fund has available certain redemption privileges, as described below.
They are unavailable to shareholders of The International Equity Portfolio, The
Labor Select International Equity Portfolio, The Global Fixed Income Portfolio
and The International Fixed Income Portfolio whose redemptions trigger the
special in-kind redemption
-24-
<PAGE>
procedures. See the Prospectus. The Fund reserves the right to suspend or
terminate these expedited payment procedures at any time in the future.
Shareholders wishing to redeem shares for which certificates have not
been issued may call the Fund at (1-800-231-8002) prior to 4 p.m., Eastern time,
and have the proceeds mailed to them at the record address. Checks payable to
the shareholder(s) of record will normally be mailed three business days, but no
more than seven days, after receipt of the redemption request.
In addition, redemption proceeds can be transferred to your predesignated
bank account by wire or by check by calling the Fund, as described above. The
Telephone Redemption Option on the Account Registration Form must have been
elected 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 Account Registration Form. Redemption proceeds will
normally be wired on the next business day following receipt of the redemption
request. There is no charge for this service. 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 Account Registration Form. Redemption proceeds will normally
be mailed three business days, 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. If expedited payment under
these procedures could adversely affect a Portfolio, the Fund may take up to
seven days to pay the shareholder.
To reduce the risk of attempted fraudulent use of the telephone
redemption procedure, payment will be made only to the bank account designated
on the Account Registration Form. If a shareholder wishes to change the bank
account designated for such redemption, a written request in accordance with the
instructions set forth in the Prospectus will be required.
Exchange Privilege
Shares of each Portfolio of the Fund may be exchanged for shares of any
other Portfolio. Exchange requests should be sent to Delaware Pooled Trust,
Inc., One Commerce Square, 2005 Market Street, Philadelphia, PA 19103 Attn:
Client Services.
Any such exchange will be based on the respective net asset values of the
shares involved and will be subject to the minimum investment requirements noted
above. There is no sales commission or charge of any kind and the shares of the
Portfolio into which the exchange is made, if necessary, must be registered in
the state in which the investor is domiciled. Before making an exchange, a
shareholder should consider the investment objectives of the Portfolio to be
purchased.
Exchange requests may be made either by mail, FAX message or by
telephone. Telephone exchanges will be accepted only if the certificates for
the shares to be exchanged are held by the Fund for the account of the
shareholder and the registration of the two accounts will be identical.
Requests for exchanges received prior to 4 p.m., Eastern time, for the
Portfolios will be processed as of the close of business on the same day.
Requests received after this time will be processed on the next business day.
Exchanges may also be subject to limitations as to amounts or frequency, and to
other restrictions established by the Board of Directors to assure that such
exchanges do not disadvantage a Portfolio and its shareholders. Exchanges into
and out of The International Equity Portfolio, The Labor Select International
Equity Portfolio, The Global Fixed Income Portfolio and The International Fixed
Income Portfolio shall be subject to the special purchase and redemption
procedures identified in sections of the Prospectus entitled "PURCHASE OF
SHARES" and "REDEMPTION OF SHARES."
For federal income tax purposes, an exchange between Portfolios is a
taxable event for shareholders subject to federal income tax, and, accordingly,
a gain or loss may be realized. The Fund reserves the right to suspend or
terminate or amend the terms of the exchange privilege upon 60 days' written
notice to client shareholders.
* * *
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<PAGE>
Neither the Fund, the Portfolios nor the Fund's transfer agent, Delaware
Service Company, Inc., is responsible for any losses incurred in acting upon
written or telephone instructions for redemption or exchange of Portfolio shares
which are reasonably believed to be genuine. With respect to such telephone
transactions, the Fund will ensure that reasonable procedures are used 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 Delaware Service Company, Inc. may be liable for any losses due to
unauthorized or fraudulent transactions. A written confirmation will be
provided for all purchase, exchange and redemption transactions initiated by
telephone.
DIVIDENDS AND CAPITAL GAIN DISTRIBUTIONS
Each Portfolio has qualified or intends to qualify, and each that has
qualified 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.
The Fund's policy is to distribute substantially all of each Portfolio's
net investment income and any net realized capital gains in the amount and at
the times that will avoid any federal income or excise taxes. Unless a
shareholder elects to receive dividends and capital gains distributions in cash,
all dividends and capital gains distributions shall be automatically reinvested
in the Portfolios of the Fund. The amounts of any dividend or capital gains
distributions cannot be predicted.
All dividends out of net investment income, together with distributions
from short-term capital gains, will be taxable to those shareholders who are
subject to income taxes as ordinary income. (These distributions may be eligible
for the dividends-received deductions for corporations.) Any net long-term
capital gains distributed to those shareholders who are subject to income tax
will be taxable as such, regardless of the length of time a shareholder has
owned their shares. Of the dividends paid by The Defensive Equity and The
Aggressive Growth Portfolios for the fiscal year ended October 31, 1994, 42% and
100%, respectively, were eligible for the dividends-received deduction for
corporations.
Undistributed net investment income is included in the Portfolio's net
assets for the purpose of calculating net asset value per share. Therefore on
the "ex-dividend" date, the net asset value per share excludes the dividend
(i.e., is reduced by the per share amount of the dividend). Dividends paid
shortly after the purchase of shares by an investor, although in effect a return
of capital, are taxable to shareholders who are subject to tax.
Each Portfolio of the Fund is treated as a separate entity (and hence as
a separate "regulated investment company") for federal tax purposes. Any net
capital gains recognized by a Portfolio are distributed to its investors without
need to offset (for federal income tax purposes) such gains against any net
capital losses of another Portfolio.
Each year, the Fund will mail you information on the amount and tax
status of each Portfolio's dividends and distributions. Shareholders should
consult their own tax advisers regarding specific questions as to federal, state
or local taxes.
For the fiscal year ended October 31, 1994, a dividend of $0.280, $0.020,
$0.949 and $0.160 per share of The Defensive Equity, The Aggressive Growth, The
Global Fixed Income and The International Equity Portfolios, respectively, was
paid from net investment income. In addition, a distribution of $0.343, $0.210,
$0.577 and $0.100 per share of The Defensive Equity, The Aggressive Growth, The
Global Fixed Income and The International Equity Portfolios, respectively, was
paid from realized securities profits.
TAXES
The following supplements the tax disclosure provided in the Fund's
Prospectus.
Futures Contracts and Stock Options
(The Aggressive Growth Portfolio and The Real Estate Investment Trust Portfolio)
The Aggressive Growth Portfolio and The Real Estate Investment Trust
Portfolio's transactions in options and futures contracts will be subject to
special tax rules that may affect the amount, timing and character of
distributions to shareholders. For example, certain positions held by a
Portfolio on the last business day of each taxable year will be
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<PAGE>
marked to market (i.e., treated as if closed out) on such day, and any gain or
loss associated with such positions will be treated as 60% long-term and 40%
short-term capital gain or loss. Certain positions held by a Portfolio that
substantially diminish its risk of loss with respect to other positions in a
Portfolio will constitute "straddles," which are subject to special tax rules
that may cause deferral of the Portfolio's losses, adjustments in the holding
periods of Portfolio securities and conversion of short-term into long-term
capital losses. Certain tax elections exist for straddles which could alter the
effects of these rules. The Portfolios will limit their activities in options
and futures contracts to the extent necessary to meet the requirements of
Subchapter M of the Code.
Forward Currency Contracts (The International Equity Portfolio, The Defensive
Equity Utility Portfolio, The Labor Select International Equity Portfolio, The
Real Estate Investment Trust Portfolio, The Global Fixed Income Portfolio and
The International Fixed Income Portfolio)
The International Equity Portfolio, The Defensive Equity Utility
Portfolio, The Labor Select International Equity Portfolio, The Real Estate
Investment Trust Portfolio, The Global Fixed Income Portfolio and The
International Fixed Income Portfolio will be required for federal income tax
purposes to recognize any gains and losses on forward currency contracts as of
the end of each taxable year as well as those actually realized during the year.
In most cases, any such gain or loss recognized with respect to a forward
currency contract is considered to be ordinary income or loss. Furthermore,
forward currency futures contracts which are intended to hedge against a change
in the value of securities held by these Portfolios may affect the holding
period of such securities and, consequently, the nature of the gain or loss on
such securities upon disposition.
Special tax considerations also apply with respect to foreign investments
of these Portfolios. For example, certain foreign exchange gains and losses
(including exchange gains and losses on forward currency contracts) realized by
the Portfolio will be treated as ordinary income or losses.
State and Local Taxes
Shares of the Fund are exempt from Pennsylvania county personal property
tax.
INVESTMENT MANAGEMENT AGREEMENT
Delaware Investment Advisers, a division of Delaware Management Company,
Inc. ("Delaware"), One Commerce Square, Philadelphia, PA 19103, furnishes
investment management services to The Defensive Equity, The Aggressive Growth,
The Fixed Income, The Limited-Term Maturity, The Defensive Equity Small/Mid-Cap,
The Defensive Equity Utility, The Real Estate Investment Trust and The High-
Yield Bond Portfolios, subject to the supervision and direction of the Fund's
Board of Directors. Delaware International Advisers Ltd. ("Delaware
International"), Veritas House, 125 Finsbury Pavement, London, England EC2A
1NQ, furnishes similar services to The International Equity, The Labor Select
International Equity, The Global Fixed Income and The International Fixed Income
Portfolios, subject to the supervision and direction of the Fund's Board of
Directors. Lincoln Investment Management, Inc. ("Lincoln") serves as sub-
adviser to Delaware with respect to The Real Estate Investment Trust Portfolio.
Lincoln's address is 200 E. Berry Street, Fort Wayne, Indiana 46802.
Delaware and its predecessors have been managing the funds in the
Delaware Group since 1938. The aggregate assets of these funds on October 31,
1994 were approximately $9,525,500,000. Investment advisory services are also
provided to institutional accounts with assets on October 31, 1994 of
approximately $16,074,376,000.
Lincoln (formerly Lincoln National Investment Management Company) was
incorporated in 1930. As of June 30, 1995, Lincoln had over $34 billion in
assets under management.
The Investment Management Agreements for The Defensive Equity, The
Aggressive Growth, The Fixed Income, The Limited-Term Maturity, The
International Equity, The Global Fixed Income and The International Fixed Income
Portfolios are each dated April 3, 1995 and were approved by shareholders on
March 29, 1995. The Investment Management Agreements for The Defensive Equity
Small/Mid-Cap, The Labor Select International, The Real Estate Investment Trust
and The High-Yield
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<PAGE>
Bond Portfolios are each dated _______________, 1995 and were approved by the
initial shareholders on ____________________, 1995. The Sub-Advisory Agreement
for The Real Estate Investment Trust Portfolio is dated ____________________,
1995 and was approved by the initial shareholder on _______________, 1995.
Each such Agreement has an initial term of two years and may be renewed
after its initial term 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 Portfolio, and only if
the terms of the renewal thereof have been approved by the vote of a majority of
the directors of the Fund who are not parties thereto or interested persons of
any such party, cast in person at a meeting called for the purpose of voting on
such approval. Each Agreement is terminable without penalty on 60 days' notice
by the directors of the Fund or by the investment adviser. Each Agreement will
terminate automatically in the event of its assignment.
As compensation for the services to be rendered under their advisory
agreements, Delaware or, as relevant, Delaware International is entitled to an
advisory fee calculated by applying a quarterly rate, based on the following
annual percentage rates, to the Portfolio's average daily net assets for the
quarter:
Portfolio Rate
---------
The Defensive Equity Portfolio .55%
The Aggressive Growth Portfolio .80%
The International Equity Portfolio .75%
The Defensive Equity Small/Mid-Cap Portfolio .__%
The Defensive Equity Utility Portfolio .35%
The Labor Select International Equity Portfolio .75%
The Real Estate Investment Trust Portfolio .75%
The Fixed Income Portfolio .40%
The Limited-Term Maturity Portfolio .30%
The Global Fixed Income Portfolio .50%
The International Fixed Income Portfolio .50%
The High-Yield Bond Portfolio .45%
Delaware has entered into a sub-advisory agreement with Lincoln with
respect to The Real Estate Investment Trust Portfolio. As compensation for its
services as sub-adviser to Delaware, Lincoln is entitled to receive a sub-
advisory fee equal to 30% of the investment management fee under Delaware's
Investment Management Agreement with the Fund on behalf of the Portfolio.
Out of the investment advisory fees to which they are otherwise
entitled, Delaware and Delaware International pay their proportionate share of
the fees paid to unaffiliated directors by the Fund, except that Delaware
International will make no such payments out of the fees it receives from
managing The International Fixed Income and The Labor Select International
Equity Portfolios and Delaware will make no such payments out of the fees it
receives from managing The Defensive Equity Small/Mid-Cap, The Defensive Equity
Utility, The Real Estate Investment Trust or The High-Yield Bond
Portfolios.
With respect to The Defensive Equity, The Aggressive Growth, The Fixed
Income and The Limited-Term Maturity Portfolios, Delaware had elected
voluntarily to waive that portion, if any, of the annual investment advisory
fees payable by a particular Portfolio and to reimburse a Portfolio for its
expenses to the extent necessary to ensure that the expenses of that Portfolio
(exclusive of taxes, interest, brokerage commissions and extraordinary expenses)
did not exceed, on an annualized basis, respectively, .68%, .93%, .53% and .43%,
as a percentage of average net assets during the period from the commencement of
the public offering for the Portfolio through October 31, 1992. These waivers
and reimbursement commitments have been extended through October 31, 1995.
Similarly, Delaware International, the investment adviser to The International
Equity Portfolio and The International Fixed Income Portfolio, voluntarily
elected to waive that portion, if any, of its annual investment advisory fees
and to reimburse a particular Portfolio for its expenses to the extent necessary
to ensure that the expenses of that Portfolio (exclusive of taxes, interest,
brokerage commissions and extraordinary expenses) did not exceed, on an
annualized basis, respectively, .96% and .62%, as a percentage of average net
assets. For The International Equity Portfolio, the waiver and reimbursement
commitment applied to the period from the commencement of the public offering
for the Portfolio through October 31, 1992. Such waiver and reimbursement
commitment has been extended through October 31, 1995. For The International
Fixed Income Portfolio the waiver and
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<PAGE>
reimbursement commitment applied to the period from the commencement of the
public offering for the Portfolio through April 30, 1994. Such waiver and
reimbursement commitment for The International Fixed Income Portfolio has been
modified to provide that such expenses of the portfolio do not exceed, on an
annual basis, .60% through October 31, 1995. Delaware International, also the
investment adviser to The Global Fixed Income Portfolio, voluntarily elected to
waive that portion, if any, of its annual investment advisory fees and to
reimburse the Portfolio for its expenses to the extent necessary to ensure that
the expenses of that Portfolio (exclusive of taxes, interest, brokerage
commissions and extraordinary expenses) did not exceed, on an annualized basis,
.62% from the commencement of the public offering of the Portfolio through
October 31, 1993. Such waiver and reimbursement commitment had been extended
through October 31, 1994, but modified, effective November 1, 1994 through
October 31, 1995, to provide that such expenses of the Portfolio do not exceed,
on an annualized basis, .60%. Amounts will be prorated over each Portfolio's
initial fiscal period from commencement of operations, if less than a complete
fiscal year.
With respect to The Defensive Equity Small/Mid-Cap Portfolio, The
Defensive Equity Utility Portfolio, The Real Estate Investment Trust Portfolio
and The High-Yield Bond Portfolio, Delaware Investment Advisers has elected
voluntarily to waive that portion, if any, of the annual Investment Advisory Fee
payable by such Portfolios and to reimburse each Portfolio for its expenses to
the extent necessary to ensure that the expenses of each Portfolio (exclusive of
taxes, interest, brokerage commissions and extraordinary expenses) do not
exceed, as a percentage of average net assets, on an annualized basis, .___%,
.49%, .89% and .59%, respectively, during the period from the commencement of
the public offering of such Portfolios through October 31, 1996. Similarly,
Delaware International, the investment adviser to The Labor Select International
Equity Portfolio, has elected voluntarily to waive that portion, if any, of the
annual Investment Advisory Fee payable by The Labor Select International Equity
Portfolio and to reimburse each Portfolio for its expenses to the extent
necessary to ensure that the expenses of that Portfolio (exclusive of taxes,
interest, brokerage commissions and extraordinary expenses) do not exceed,on an
annualized basis, .96% of such Portfolio's average net assets during the period
from the commencement of the public offering of the Portfolio through October
31, 1996. In the absence of such voluntary waivers, Total Operating Expenses (as
a percentage of average net assets) are expected to equal ____%, ____%, ____%,
____% and _____%, respectively, for the Portfolios in the order they appear in
the above table. Other Operating Expenses for each of the Portfolios are
estimated. For the period February 3, 1992 (date of initial sale) to October 31,
1992, the investment management fee earned by The Defensive Equity Portfolio
amounted to $12,880. For the period February 27, 1992 (date of initial sale) to
October 31, 1992, the investment management fee earned by The Aggressive Growth
Portfolio amounted to $22,909. For the period February 4, 1992 (date of initial
sale) to October 31, 1992, the investment management fee earned by The
International Equity Portfolio amounted to $17,068. After consideration of the
waiver of fees by the respective investment manager, no amounts were paid by the
Portfolios.
For the fiscal years ended October 31, 1993 and 1994, the investment
management fees earned by The Defensive Equity, The Aggressive Growth and The
International Equity Portfolios amounted to $43,337 and $121,537, respectively,
$110,380 and $171,517, respectively, and $95,454 and $390,070, respectively.
For the period November 30, 1992 (date of initial sale) to October 31, 1993 and
for the fiscal year ended October 31, 1994, the investment management fees
earned by The Global Fixed Income Portfolio amounted to $107,750 and $175,663,
respectively. After consideration of the waiver of fees by the respective
investment manager $43,519 and $118,977 was paid by The Aggressive Growth
Portfolio for 1993 and 1994, respectively, $39,792 and $374,822 was paid by The
International Equity Portfolio for 1993 and 1994, respectively, $51,238 and
$124,905 was paid by The Global Fixed Income Portfolio for 1993 and 1994,
respectively, and no amount was paid by The Defensive Equity Portfolio for 1993
and $88,345 was paid by this Portfolio for 1994.
On October 31, 1994, the total net assets of the Fund were $173,090,475,
broken down as follows: The Defensive Equity Portfolio--$37,323,158; The
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<PAGE>
Aggressive Growth Portfolio--$22,639,723; The International Equity Portfolio--
$70,820,004; The Fixed Income Portfolio--$21,000; The Limited-Term Maturity
Portfolio--$21,000; and The Global Fixed Income Portfolio--$42,265,590.
Delaware 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. In connection with the merger, new Investment Management Agreements
between the Fund on behalf of The Defensive Equity Portfolio, The Aggressive
Growth Portfolio, The Fixed Income Portfolio and The Limited-Term Maturity
Portfolio and Delaware and new Investment Management Agreements between the Fund
on behalf of The International Equity Portfolio, The Global Fixed Income
Portfolio and The International Equity Fixed Income Portfolio and Delaware
International were executed following shareholder approval. As a result of the
merger, DMH became a wholly-owned subsidiary and Delaware and Delaware
International became indirect, wholly-owned subsidiaries of Lincoln National and
each is now subject to the ultimate control of Lincoln National. Lincoln
Investment Management, Inc., the sub-adviser to Delaware with respect to The
Real Estate Investment Trust Portfolio, is also a wholly-owned subsidiary of
Lincoln National. Delaware, Delaware International, and Lincoln may be deemed
to be affiliated persons under the 1940 Act, as the three companies are under
the ultimate control of Lincoln National.
Except for the expenses borne by the investment advisers under their
respective Investment Management Agreements and the Distributor under the
Distribution Agreements, each Portfolio is responsible for all of its own
expenses. Among others, these include each Portfolio's proportionate share of
rent and certain other administrative expenses; the investment management fees;
transfer and dividend disbursing agent fees and costs; custodian expenses;
federal and state securities registration fees; proxy costs; and the costs of
preparing prospectuses and reports sent to shareholders. The ratio of expenses
to average daily net assets for The Defensive Equity, The Aggressive Growth, The
International Equity and The Global Fixed Income Portfolios for the fiscal year
ended October 31, 1994 was 0.68%, 0.93%, 0.94% and 0.62%, respectively. These
ratios reflect the waiver of fees by the respective investment adviser, as
described above.
By California regulation, the respective investment advisers are
required to waive certain fees and reimburse the Portfolios they manage for
certain expenses to the extent that the Portfolios' 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 period ended October 31, 1994, no such
reimbursement was necessary or paid.
Distribution and Service
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 for The Defensive Equity, The
Aggressive Growth, The Fixed Income, The Limited-Term Maturity, The
International Equity, The Global Fixed Income and The International Fixed Income
Portfolios under separate Distribution Agreements dated April 3, 1995. It is
the distributor for The Defensive Equity Small/Mid-Cap, The Defensive Equity
Utility, The Labor Select International Equity, The Real Estate Investment Trust
and The High-Yield Bond Portfolios under separate Distribution Agreements dated
____________________, 1995. Delaware Distributors, L.P. is an affiliate of the
investment advisers and bears all of the costs of promotion and distribution.
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.
Delaware Service Company, Inc., an affiliate of Delaware, is the Fund's
shareholder servicing, dividend disbursing and transfer agent for each Portfolio
pursuant to an Amended and Restated
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Shareholders Services Agreement dated ____________________, 1995. Delaware
Service Company, Inc.'s principal business address is 1818 Market Street,
Philadelphia, PA 19103. It is also an indirect, wholly-owned subsidiary of
DMH.
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<PAGE>
OFFICERS AND DIRECTORS
The business and affairs of the Fund are managed under the direction of its
Board of Directors. As of _______________, 1995, [no one account held more
than 25% of Delaware Pooled Trust, Inc.] As of _______________, 1995, [5%
holders]
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<PAGE>
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 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, new Investment Management Agreements between the
Fund on behalf of The Defensive Equity Portfolio, The Aggressive Growth
Portfolio, The Fixed Income Portfolio and The Limited-Term Maturity
Portfolio, and Delaware and new Investment Management Agreements between the
Fund on behalf of The International Equity Portfolio, The Global Fixed Income
Portfolio and The International Fixed Income Portfolio and Delaware
International were executed following shareholder approval. As a result of
the merger, DMH became a wholly-owned subsidiary and Delaware and Delaware
International became indirect, wholly-owned subsidiaries of Lincoln National
and each is 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.
Certain officers and directors of the Fund hold identical positions in
each of the other funds in the Delaware Group. Directors and principal
officers of the Fund are noted below along with their ages and their business
experience for the past five years. Unless otherwise noted, the address of
each officer and director is One Commerce Square, Philadelphia, PA 19103.
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<PAGE>
*Wayne A. Stork (58)
Chairman, Director and/or Trustee of the Fund, each of the other 16 funds in
the Delaware Group 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 Delaware Management
Holdings, Inc., 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.
-----------------------------
*Director affiliated with the investment manager of the Fund and considered an
"interested person" as defined in the Investment Company Act of 1940.
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<PAGE>
Winthrop S. Jessup (50)
Executive Vice President of the Fund, 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 Management Trust Company, Delaware Service Company,
Inc. and Delaware International Advisers Ltd.
During the past five years, Mr. Jessup has served in various executive
capacities at different times within the Delaware organization.
Richard G. Unruh, Jr. (56)
Executive Vice President of the Fund and each of the other 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.
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.
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<PAGE>
Ann R. Leven (54)
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 (74)
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.
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/Chief Financial
Officer and Director of Delaware Service Company, Inc.
Senior Vice President/Chief Administrative Officer and Director of
Delaware Distributors, Inc.
Senior Vice President/Chief Administrative Officer of Delaware
Distributors, L.P.
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.
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<PAGE>
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.
George E. Deming (54)
Vice President/Senior Portfolio Manager of The Defensive Equity
Portfolio.
Before joining the Delaware Group in 1978, Mr. Deming was responsible
for portfolio management and institutional sales at White Weld & Co.,
Inc. He is a member of the Financial Analysts of Philadelphia.
During the past five years, Mr. Deming has served in various capacities
at different times with the Delaware organization.
Edward N. Antoian (39)
Vice President/Senior Portfolio Manager of the Fund, of seven other
equity funds in the Delaware Group and of Delaware Management
Company, Inc.
During the past five years, Mr. Antoian has served in such capacities
within the Delaware organization.
Gary A. Reed (41)
Vice President/Senior Portfolio Manager of the Fund, of the nine other
income (including tax-exempt) funds in the Delaware Group, of
Delaware Management Company, Inc. and Delaware Investment Counselors,
Inc.
During the past five years, Mr. Reed has served in such capacities
within the Delaware organization.
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<PAGE>
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.
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, L.P., Delaware Distributors, Inc., Delaware Service
Company, Inc., Founders Holdings, Inc. and Founders CBO Corporation.
Before joining the Delaware Group in 1995, Mr. Bishof was a Vice
President for Bankers Trust, New York, NY from 1994 to 1995, a Vice
President for CS First Boston Investment Management, New York, NY
from 1993 to 1994 and an Assistant Vice President for Equitable
Capital Management Corporation, New York, NY from 1987 to 1993.
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<PAGE>
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 October 31, 1994 and an estimate of annual benefits to be received upon
retirement under the Delaware Group Retirement Plan for Directors/Trustees as of
October 31, 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 $1,606.16 None $18,100 $39,960.02
Ann R. Leven $1,748.92 None $18,100 $44,960.02
Walter P. Babich $1,720.24 None $18,100 $43,960.03
Anthony D. Knerr $1,833.68 None $18,100 $43,962.11
Charles E. Peck $1,448.16 None $18,100 $36,824.07
</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 October 31,
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.
-39-
<PAGE>
GENERAL INFORMATION
Custody Arrangements
The Morgan Guaranty Trust Company of New York, 60 Wall Street, New York,
NY 10260 serves as the Fund's custodian for domestic securities. With respect
to foreign securities, the Custodian Bank makes arrangements with subcustodians
who were approved by the directors of the Fund in accordance with Rule 17f-5 of
the 1940 Act. In the selection of foreign subcustodians, the directors consider
a number of factors, including, but not limited to, the reliability and
financial stability of the institution, the ability of the institution to
provide efficiently the custodial services required for the Fund, and the
reputation of the institutions in the particular country or region.
Capitalization
The Fund has a present authorized capitalization of one billion shares
of capital stock with a $.01 par value per share. The Board of Directors has
allocated fifty million shares to each Portfolio. While all shares have equal
voting rights on matters affecting the entire Fund, each Portfolio would vote
separately on any matter which affects only that Portfolio, such as any change
in its own investment objective and policy or action to dissolve a Portfolio and
as otherwise prescribed by the 1940 Act. Shares of each Portfolio have a
priority in that Portfolios' assets, and in gains on and income from the
portfolio of that Portfolio. Shares have no preemptive rights, are fully
transferable and, when issued, are fully paid and nonassessable.
The legality of the issuance of the shares offered hereby, pursuant to
registration under the Investment Company Act Rule 24f-2, has been passed upon
for the Fund by Messrs. Stradley, Ronon, Stevens & Young, Philadelphia,
Pennsylvania.
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.
-40-
<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 Reports. The Defensive Equity, The Aggressive Growth, The International
Equity and The Global Fixed Income Portfolios' Statements of Net Assets,
Statements of Investments, Statements of Assets and Liabilities, Statements of
Operations, Statements of Changes in Net Assets and Notes to Financial
Statements, and The Fixed Income, The Limited-Term Maturity and The
International Fixed Income Portfolios' Statements of Assets and Liabilities and
Notes to Financial Statements as well as the reports of Ernst & Young LLP,
independent auditors, for the fiscal year ended October 31, 1994 are included in
the Fund's Annual Reports 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 Reports into this Part B. In
addition, the unaudited financial statements and the notes relating thereto for
The Defensive Equity, The Aggressive Growth, The Fixed Income, The Limited-Term
Maturity, The International Equity, The Global Fixed Income and The
International Fixed Income Portfolios are incorporated by reference from the
Semi-Annual Reports into this Part B.
-41-
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
PART C
------
<TABLE>
<CAPTION>
Item No. Description Location in Part C
-------- ----------- ------------------
<C> <S> <C>
24 Financial Statements and Exhibits ...... Item 24
25 Persons Controlled by or under Common
Control with Registrant ................ Item 25
26 Number of Holders of Securities ........ Item 26
27 Indemnification ........................ Item 27
28 Business and Other Connections of
Investment Adviser ..................... Item 28
29 Principal Underwriters ................. Item 29
30 Location of Accounts and Records ....... Item 30
31 Management Services .................... Item 31
32 Undertakings ........................... Item 32
</TABLE>
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
PART C
------
Other Information
-----------------
Item 24. Financial Statements and Exhibits
---------------------------------
(a) Financial Statements:
Part A - Financial Highlights
*Part B - Statements of Net Assets
Statements of Investments
Statements of Assets and Liabilities
Statements of Operations
Statements of Changes in Net Assets
Notes to Financial Statements
Accountant's Report
* The financial statements and Accountant's Report listed above are
incorporated by reference from the Registrant's Annual Reports for
The Defensive Equity, The Aggressive Growth, The Global Fixed
Income and The International Equity Portfolios and the Statements
of Assets and Liabilities, Notes to Financial Statements and
Accountant's Reports for The Fixed Income, The International Fixed
Income and The Limited-Term Maturity Portfolios for the fiscal year
ended October 31, 1994. In addition, unaudited financial
statements for The International Equity, The Global Fixed Income,
The Defensive Equity, The Aggressive Growth, The Fixed Income, The
International Fixed Income and The Limited-Term Maturity Portfolios
for the six-month period ended April 30, 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 July 7, 1995.
(b) Exhibits:
(1) Articles of Incorporation. Attached as Exhibit.
-------------------------
(2) By-Laws. Attached as Exhibit.
-------
(3) Voting Trust Agreement. Inapplicable.
----------------------
i
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
(4) Copies of All Instruments Defining the Rights of Holders.
--------------------------------------------------------
(a) Articles of Incorporation and Articles Supplementary.
----------------------------------------------------
Articles Fifth and Ninth of the Articles of
Incorporation, Article Fifth of Articles of Amendment
dated October 10, 1991, Article Second of Articles
Supplementary dated September 21, 1992, Article
Second of Articles Supplementary dated August 3, 1993
and Article Second of Articles Supplementary dated
October 12, 1994 and Form of Articles Supplementary dated
September, ______ 1995 attached in Exhibit 24(b)(1).
(b) By-Laws. Articles II, III and XIV of the By-Laws
-------
attached in Exhibit 24(b)(2).
(5) Investment Management Agreements. Investment Management
--------------------------------
Agreements between Delaware Management Company, Inc. and
the Registrant on behalf of The Defensive Equity, The
Aggressive Growth, The Fixed Income and The Limited-Term
Maturity Portfolios dated April 3, 1995 attached as
Exhibit. Investment Management Agreements between Delaware
International Advisers Ltd. and the Registrant on behalf of
The International Equity, The Global Fixed Income and The
International Fixed Income Portfolios dated April 3, 1995
attached as Exhibit.
Investment Management Agreements between Delaware
Management Company, Inc. and the Registrant on behalf of
The Defensive Equity Small/Mid Cap, The Defensive Equity
Utility, The High-Yield Bond and The Real Estate Investment
Trust Portfolios to be filed by Amendment. Investment
Management Agreement between Delaware International
Advisers Ltd. and the Registrant on behalf of The Labor
Select International Equity Portfolio to be filed by
Amendment. Sub-Advisory Agreement between Delaware
Management Company, Inc. and Lincoln Investment Management,
Inc. on behalf of the Registrant for The Real Estate
Investment Trust Portfolio to be filed by Amendment.
ii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
(6) (a) Distribution Agreements. Incorporated by reference
-----------------------
to Post-Effective Amendment No. 1 filed May 18, 1992
and Post-Effective Amendment No. 6 filed December 29,
1993.
Distribution Agreements between Delaware
Distributors, L.P. and the Registrant on behalf of
each Portfolio to be filed by Amendment.
(b) Administration and Service Agreement. Form of
------------------------------------
Administration and Service Agreement included as
Module Name ADMIN_SER_AGREE.
(c) Dealer's Agreement. Dealer's Agreement included as
------------------
Module Name DEALERS_AGREE.
(d) Form of Mutual Fund Agreement for the Delaware Group
of Funds included as Module Name MUTUAL_FUND_AGR.
(7) Bonus, Profit Sharing, Pension Contracts. Amended and
----------------------------------------
Restated Profit
Sharing Plan included as Module Name PROF_SHARE_PLAN.
(8) Custodian Agreements. Incorporated by reference to Post-
--------------------
Effective Amendment No. 1 filed May 18, 1992, Post-
Effective Amendment No. 3 filed October 29, 1992 and Post-
Effective Amendment No. 6 filed December 29, 1993.
Custodian Agreements for The International Fixed Income,
The Defensive Equity Small/Mid-Cap, The Defensive Equity
Utility, The High-Yield Bond, The Labor Select
International Equity and The Real Estate Investment Trust
Portfolios to be filed by Amendment.
(9) Other Material Contracts. Incorporated by reference to
------------------------
Post-Effective Amendment No. 6 filed December 29, 1993.
Third Amended and Restated Shareholders Services Agreement
between Delaware Service Company, Inc. and the Registrant
on behalf of each Portfolio to be filed by Amendment.
iii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
(10) Opinion of Counsel. Filed with letter relating to Rule
------------------
24f-2 on December 28, 1994.
(11) Consent of Auditors. To be filed by Amendment.
-------------------
(12) Inapplicable.
(13) Undertaking of Initial Shareholder. Incorporated by
----------------------------------
reference to Pre-Effective Amendment No. 1 filed
August 16, 1991.
(14-15) Inapplicable.
(16) Schedules of Computation for each Performance Quotation.
-------------------------------------------------------
Attached as Exhibit.
(17) Financial Data Schedules. Attached as Exhibit.
------------------------
(18) Inapplicable.
(19) Other: Directors' Power of Attorney. Attached as
----------------------------
Exhibit.
(20) Other: Financial Statements. The Registrant's Annual
--------------------
Report for the fiscal year ended October 31, 1994
attached as Exhibit.
Item 25. Persons Controlled by or under Common Control with Registrant.
-------------------------------------------------------------
None.
iv
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Item 26. Number of Holders of Securities.
-------------------------------
(1) (2)
Number of
Title of Class Record Holders
-------------- --------------
The Defensive Equity Portfolio:
Common Stock Par Value 24 Accounts as of
$.01 Per Share July 31, 1995
The Aggressive Growth Portfolio:
Common Stock Par Value 43 Accounts as of
$.01 Per Share July 31, 1995
The International Equity Portfolio:
Common Stock Par Value 32 Accounts as of
$.01 Per Share July 31, 1995
The Global Fixed Income Portfolio:
Common Stock Par Value 9 Accounts as of
$.01 Per Share July 31, 1995
The Fixed Income Portfolio:
Common Stock Par Value 1 Account as of
$.01 Per Share July 31, 1995
v
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Number of
Title of Class Record Holders*
-------------- --------------
The Limited-Term
Maturity Portfolio:
Common Stock Par Value 1 Account as of
$.01 Per Share July 31, 1995
The International Fixed
Income Portfolio:
Common Stock Par Value 0 Accounts as of
$.01 Per Share July 31, 1995
The Defensive Equity Small/
Mid-Cap Portfolio:
Common Stock Par Value 0 Accounts as of
$.01 Per Share July 31, 1995
The Defensive Equity Utility
Portfolio:
Common Stock Par Value 0 Accounts as of
$.01 Per Share July 31, 1995
The High-Yield Bond Portfolio:
Common Stock Par Value 0 Accounts as of
$.01 Per Share July 31, 1995
The Labor Select International
Equity Portfolio:
Common Stock Par Value 0 Accounts as of
$.01 Per Share July 31, 1995
The Real Estate Investment
Trust Portfolio:
Common Stock Par Value 0 Accounts as of
$.01 Per Share July 31, 1995
* The Defensive Equity Small/Mid-Cap, The Defensive Equity Utility, The
High-Yield Bond, The Labor Select International Equity and The Real
Estate Investment Trust Portfolios were not offered prior to the
effective date of this Registration Statement.
vi
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Item 27. Indemnification. Incorporated by reference to initial Registration
---------------
Statement filed May 31, 1991.
Item 28. Business and Other Connections of Investment Adviser.
----------------------------------------------------
(a) Delaware Management Company, Inc. ("DMC") serves as investment
manager to The Defensive Equity Portfolio, The Aggressive Growth Portfolio,
The Fixed Income Portfolio, The Limited-Term Maturity Portfolio, The
Defensive Equity Small/Mid-Cap Portfolio, The Defensive Equity Utility
Portfolio, The High-Yield Bond Portfolio and The Real Estate Investment Trust
Portfolio. In addition, DMC also serves as investment manager or sub-adviser
to the other funds in the Delaware Group (Delaware Group Delaware Fund, Inc.,
Delaware Group Trend Fund, Inc., Delaware Group Value Fund, Inc., Delaware
Group DelCap Fund, Inc., Delaware Group Decatur Fund, Inc., Delaware Group
Delchester High-Yield Bond Fund, Inc., Delaware Group Government Fund, Inc.,
Delaware Group Limited-Term Government Funds, Inc., Delaware Group Cash
Reserve, Inc., Delaware Group Tax-Free Fund, Inc., DMC Tax-Free Income Trust-
Pennsylvania, Delaware Group Tax-Free Money Fund, Inc., Delaware Group
Premium Fund, Inc., Delaware Group Global & International Funds, Inc.,
Delaware 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 DMC 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 DMC's parent company acts as principal
underwriter to the funds in the Delaware Group (see Item 29 below) and
another such company acts as the shareholder servicing, dividend disbursing
and transfer agent for all of the other mutual funds in the Delaware Group.
vii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
The following persons serving as directors or officers of DMC have held
the following positions during the past two years:
Name and Principal Positions and Offices with DMC and its Affiliates and
Business Address* 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.; President and Chief Executive Officer of the
Registrant; Executive Vice President of each of the
other funds in the Delaware Group and Delaware
Management Holdings, 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.
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
viii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Name and Principal Positions and Offices with DMC and its Affiliates and
Business Address* Other Positions and Offices Held
------------------ -----------------------------------------------------
Richard G. Unruh, Jr. Executive Vice President and Director of Delaware
Management Company, Inc.; Executive Vice President of
the Registrant and each of the other funds in the
Delaware Group; Senior Vice President of Delaware
Management Holdings, Inc.; and Director of Delaware
International Advisers Ltd.
Board of Directors, Chairman of Finance Committee,
Keystone Insurance Company since 1989, 2040 Market
Street, Philadelphia, PA; Board of Directors, Chairman
of Finance Committee, Mid Atlantic, Inc., since 1989,
2040 Market Street, Philadelphia, PA
Paul E. Suckow Senior Vice President/Chief Investment Officer, Fixed
Income of Delaware Management Company, Inc., the
Registrant, each of the other funds in the Delaware
Group and Delaware Management Holdings, Inc.; Senior
Vice President and Director of Founders Holdings, Inc.;
and Director of Founders CBO Corporation
David K. Downes Senior Vice President, Chief Administrative Officer and
Chief Financial Officer of Delaware Management
Company, Inc., the Registrant and each of the other
funds in the Delaware Group; Chairman and Director of
Delaware Management Trust Company; Senior Vice
President, Chief Administrative Officer, Chief
Financial Officer and Treasurer of Delaware Management
Holdings, Inc.; Senior Vice President, Chief Financial
Officer, Treasurer and Director of DMH Corp.; Senior
Vice President, Chief Administrative Officer and
Director of Delaware Distributors, Inc.; Senior Vice
President and Chief Administrative Officer of Delaware
Distributors, L.P.; Senior Vice President, Chief
Administrative Officer, Chief Financial Officer and
Director of Delaware Service Company, Inc.; Chief
Financial Officer and Director of Delaware
International Holdings Ltd.; Senior Vice President,
Chief Financial Officer and Treasurer of Delaware
Investment Counselors, Inc.; Senior Vice President and
Director of Founders Holdings, Inc.; and Director of
Delaware International Advisers Ltd.
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
ix
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Name and Principal Positions and Offices with DMC and its Affiliates and
Business Address* Other Positions and Offices Held
------------------ -----------------------------------------------------
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, Inc.; 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
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
*Business address of each is 1818 Market Street, Philadelphia, PA 19103
x
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Name and Principal Positions and Offices with DMC and its Affiliates and
Business Address* Other Positions and Offices Held
------------------ -----------------------------------------------------
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.
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. Vice President/Operations of Delaware Management
Anderson/4/ Company, Inc. and Delaware Service Company, Inc.; and
Vice President/Operations and Director of Delaware
Management Trust Company
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
xi
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Name and Principal Positions and Offices with DMC and its Affiliates and
Business Address* Other Positions and Offices Held
------------------ -------------------------------------------------------
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., the Registrant, 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., the Registrant, 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., the Registrant, 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., the Registrant, 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., the Registrant, 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
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
xii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Name and Principal Positions and Offices with DMC and its Affiliates and
Business Address* Other Positions and Offices Held
------------------ -------------------------------------------------------
Patrick P. Coyne Vice President/Senior Portfolio Manager of Delaware
Management Company, Inc., the Registrant, each of the
tax-exempt funds and the fixed income funds in the
Delaware Group
Roger A. Early/6/ Vice President/Senior Portfolio Manager of Delaware
Management Company, Inc., the Registrant, 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 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 equity funds in the Delaware Group
John B. Fields Vice President/Senior Portfolio Manager of Delaware
Management Company, Inc., the Registrant, each of the
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 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 equity funds in the Delaware Group
xiii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Name and Principal Positions and Offices with DMC and its Affiliates and
Business Address* Other Positions and Offices Held
------------------ -------------------------------------------------------
Richelle S. Maestro Vice President and Assistant Secretary of Delaware
Management Company, Inc., Delaware Management Holdings,
Inc., Delaware Distributors, L.P., Delaware
Distributors, Inc., Delaware Service Company, Inc., the
Registrant, each of the other funds in the Delaware
Group, 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.
(b) Delaware International Advisers Ltd. serves as investment
manager to The International Equity Portfolio, The Global Fixed Income
Portfolio, The International Fixed Income Portfolio and The Labor Select
International Equity Portfolio and other institutional accounts. Delaware
International Advisers Ltd. also serves as investment manager or sub-adviser
to Delaware Group Global & International Funds, Inc. and Delaware Group
Global Dividend and Income Fund, Inc. Information regarding the officers and
directors of Delaware International Advisers Ltd. and the positions they held
during the past two years follow:
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
xiv
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust,Inc.
Positions and Offices with Delaware International
Name and Principal dvisers Ltd. and its Affiliates and Other Positions
Business Address and Offices Held
------------------ -------------------------------------------------------
*Wayne A. Stork Chairman of the Board, Chief Executive Officer and
Director of Delaware International Advisers Ltd.,
Delaware Management Holdings, Inc., DMH Corp., Delaware
International Holdings Ltd. and Founders Holdings,
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 of the Board, Chief Executive Officer, Chief
Investment Officer and Director of Delaware Management
Company, Inc.; and Director of Delaware Distributors,
Inc. and Delaware Service Company, Inc.
**G. Roger H. Kitson Vice Chairman and Director of Delaware International
Advisers Ltd.
**David G. Tilles Managing Director, Chief Investment Officer and
Director of Delaware International Advisers Ltd.
**John Emberson Secretary/Compliance Officer/Finance Officer/Director
of Delaware International Advisers Ltd.
*Business address is 1818 Market Street, Philadelphia, PA 19103.
**Business address is Veritas House, 125 Finsbury Pavement, London,
England EC2A 1NQ.
xv
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Positions and Offices with Delaware International
Name and Principal Advisers Ltd. and its Affiliates and Other Positions
Business Address and Offices Held
------------------ -------------------------------------------------------
*David K. Downes Director of Delaware International Advisers Ltd.;
Senior Vice President, Chief Administrative Officer,
Chief Financial Officer and Treasurer of Delaware
Management Holdings, Inc.; Senior Vice President/Chief
Administrative Officer/Chief Financial Officer of
Delaware Management Company, Inc., the Registrant and
each of the other funds in the Delaware Group; Chairman
and Director of Delaware Management Trust Company;
Senior Vice President, Chief 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.; and
Senior Vice President and Director of Founders
Holdings, Inc.
George M. Director of Delaware International Advisers Ltd.;
Chamberlain, Jr. Senior Vice President and Secretary of the Registrant,
each of the other funds in the Delaware Group, Delaware
Distributors, L.P., Delaware Management Holdings, Inc.
and Delaware Investment Counselors, Inc.; Senior Vice
President, Secretary and Director of Delaware
Management Company, Inc., DMH Corp., Delaware
Distributors, Inc. and Delaware Service Company, Inc.;
Executive Vice President, Secretary and Director of
Delaware Management Trust Company; Corporate Vice
President, Secretary and Director of Founders Holdings,
Inc.; and Secretary and Director of Delaware
International Holdings Ltd.
Director of ICI Mutual Insurance Co. since 1992, P.O.
Box 730, Burlington, VT
*Business address is 1818 Market Street, Philadelphia, PA 19103.
**Business address is Veritas House, 125 Finsbury Pavement, London,
England EC2A 1NQ.
xvi
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Positions and Offices with Delaware International
Name and Principal Advisers Ltd. and its Affiliates and Other Positions
Business Address and Offices Held
------------------ -------------------------------------------------------
*Winthrop S. Jessup Director of Delaware International Advisers Ltd.,
Delaware Management Trust Company and Delaware Service
Company, Inc.; President and Chief Executive Officer of
the Registrant; Executive Vice President of each of the
other funds in the Delaware Group and Delaware
Management Holdings, Inc.; Executive Vice President and
Director of DMH Corp., Delaware Management Company,
Inc., Delaware International Holdings Ltd. and Founders
Holdings, Inc.; Vice Chairman of Delaware Distributors,
L.P.; Vice Chairman and Director of Delaware
Distributors, Inc.; and President and Director of
Delaware Investment Counselors, Inc.
*Richard G. Director of Delaware International Advisers Ltd.;
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; and Senior Vice President of Delaware
Management Holdings, Inc.
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
*Richard J. Flannery Director of Delaware International Advisers Ltd;
Managing Director/Corporate Tax & Affairs of Delaware
Management Holdings, Inc., DMH Corp., Delaware
Management Company, Inc., 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; and Managing Director/Corporate & Tax
Affairs and Director of Founders Holdings, Inc.
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
*Business address is 1818 Market Street, Philadelphia, PA 19103.
**Business address is Veritas House, 125 Finsbury Pavement, London,
England EC2A 1NQ.
xvii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Positions and Offices with Delaware International
Name and Principal Advisers Ltd. and its Affiliates and Other Positions
Business Address and Offices Held
------------------ -------------------------------------------------------
*John C. E. Campbell Director of Delaware International Advisers Ltd.
**Timothy W. Senior Portfolio Manager/Deputy Compliance
Sanderson Officer/Director Equity Research of Delaware
International Advisers Ltd.
**Clive A. Gillmore Senior Portfolio Manager/Director U.S. Mutual Fund
Liaison of Delaware International Advisers Ltd.
**Hamish O. Parker Senior Portfolio Manager/Director U.S. Marketing
Liaison of Delaware International Advisers Ltd.
**Ian G. Sims Senior Portfolio Manager/Deputy Managing Director of
Delaware International Advisers Ltd.
**Elizabeth A. Senior Portfolio Manager of Delaware International
Desmond Advisers Ltd.
**Gavin A. Hall Senior Portfolio Manager of Delaware International
Advisers Ltd.
* Business address is 1818 Market Street, Philadelphia, PA 19103.
** Business address is Veritas House, 125 Finsbury Pavement, London,
England EC2A 1NQ.
xviii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
(c) Lincoln Investment Management Company, Inc. serves as sub-adviser to The
Real Estate Investment Trust Portfolio. Lincoln Investment Management
Company, Inc. also serves as investment Advisor to Lincoln National
Convertible Securities Fund, Inc., Lincoln National Income Fund, Inc.,
Lincoln National Aggressive Growth Fund, Inc., Lincoln National Bond Fund,
Inc., Lincoln National Capital Appreciation Fund, Inc., Lincoln National
Equity-Income Fund, Inc., Lincoln National Global Asset Allocation Fund,
Inc., Lincoln National Growth and Income Fund, Inc., Lincoln National
International Fund, Inc., Lincoln National Managed Fund, Inc., Lincoln
National Money Market Fund, Inc., Lincoln National Social Awareness Fund,
Inc., Lincoln National Special Opportunities Fund, Inc., Lincoln Advisor
Funds, Inc. (a retail mutual fund complex) and to other clients. Lincoln
Investment Management, Inc. is registered with the Securities and Exchange
Commission (the Commission) as an investment Advisor and has acted as an
investment Advisor to investment companies for over 40 years.
Information regarding the officers and directors of Lincoln Investment
Management Company, Inc. and the positions they held during the past two years
follow:
Positions and Offices with Lincoln Investment
Name and Principal Management, Inc. and its Affiliates and Other
Business Address* Positions and Offices Held
------------------ -------------------------------------------------------
H. Thomas McMeekin President and Director of Lincoln Investment
Management, Inc., Lincoln National Convertible
Securities Fund, Inc. and Lincoln National Income Fund,
Inc.; President, Chief Executive Officer and Director
of Lincoln National Mezzanine Corporation; Executive
Vice President (previously Senior Vice President) and
Chief Investment Officer of Lincoln National
Corporation; and Director of Lincoln Advisor Funds,
Inc., The Lincoln National Life Insurance Company,
Lynch & Mayer, Inc. and Vantage Global Advisors, Inc.
Dennis A. Blume Senior Vice President and Director of Lincoln
Investment Management, Inc. and Lincoln National Realty
Corporation; Vice President of Lincoln Advisor Funds,
Inc.; and Director of Lynch & Mayer, Inc. and Vantage
Global Advisors, Inc.
Steven R. Brody Director, Senior Vice President and Assistant Treasurer
of Lincoln Investment Management, Inc.; Vice President,
Treasurer and Chief Financial Officer of Lincoln
Advisor Funds, Inc.; Director and Vice President of
Lincoln National Mezzanine Corporation; Vice President
of The Lincoln National Life Insurance Company;
Director of Lincoln National Realty Corporation;
Treasurer of Lincoln National Convertible Securities
Fund, Inc. and Lincoln National Income Fund, Inc.; and
Assistant Treasurer of Lincoln Financial Group, Inc.,
Lincoln National Aggressive Growth Fund, Inc., Lincoln
National Bond Fund, Inc., Lincoln National Capital
Appreciation Fund, Inc., Lincoln National Equity-Income
Fund, Inc., Lincoln National Global Asset Allocation
Fund, Inc., Lincoln National Growth and Income Fund,
Inc., Lincoln National Health & Casualty Insurance
Company, Lincoln National International Fund, Inc.,
Lincoln National Life Reinsurance Company, Lincoln
National Managed Fund, Inc., Lincoln National Money
Market Fund, Inc., Lincoln National Reassurance
Company, Lincoln National Social Awareness Fund, Inc.,
Lincoln National Special Opportunities Fund, Inc.
*Business address is 200 East Berry Street, Fort Wayne, IN 46802.
xix
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Positions and Offices with Lincoln Investment
Name and Principal Management, Inc. and its Affiliates and Other
Business Address* Positions and Offices Held
------------------ -------------------------------------------------------
Ann L. Warner Senior Vice President (previously Vice President) of
Lincoln Investment Management, Inc.; Director of
Lincoln National Convertible Securities Fund, Inc.;
Director and Vice President of Lincoln National Income
Fund, Inc.; and Vice President of Lincoln Advisor
Funds, Inc.
JoAnn E. Becker Vice President of Lincoln Investment Management, Inc.,
Lincoln Advisor Funds, Inc. and The Lincoln National
Life Insurance Company; and Director of LNC Equity
Sales Corporation, The Richard Leahy Corporation and
Professional Financial Planning, Inc.
David A. Berry Vice President of Lincoln Investment Management, Inc.,
Lincoln Advisor Funds, Inc., Lincoln National
Convertible Securities Fund, Inc. and Lincoln National
Income Fund, Inc.
Anne E. Bookwalter Vice President (previously Second Vice President) of
Lincoln Investment Management, Inc.; and Director of
Professional Financial Planning, Inc.
Philip C. Byrde Vice President of Lincoln Investment Management, Inc.
Patrick R. Chasey Vice President of Lincoln Investment Management, Inc.
Garrett W. Cooper Vice President of Lincoln Investment Management, Inc.
David C. Fischer Vice President of Lincoln Investment Management, Inc.
and Lincoln National Income Fund, Inc.
Luc N. Girard Vice President of Lincoln Investment Management, Inc.
and The Lincoln National Life Insurance Company
Donald P. Groover Vice President of Lincoln Investment Management, Inc.
Previously Senior Economist/Senior Consultant, Chalke,
Inc., Chantilly, VA.
*Business address is 200 East Berry Street, Fort Wayne, IN 46802.
xx
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Positions and Offices with Lincoln Investment
Name and Principal Management, Inc. and its Affiliates and Other
Business Address* Positions and Offices Held
------------------ -------------------------------------------------------
William N. Holm, Jr. Vice President of Lincoln Investment Management, Inc.;
and Vice President and Director of Lincoln National
Mezzanine Corporation
Jennifer C. Hom Vice President (previously Portfolio Manager) of
Lincoln Investment Management, Inc.
John A. Kellogg Vice President of Lincoln Investment Management, Inc.
and Lincoln National Realty Corporation
Timothy H. Kilfoil Vice President of Lincoln Investment Management, Inc.
Lawrence T. Kissko Vice President of Lincoln Investment Management, Inc.;
Vice President and Director Lincoln National Realty
Corporation; and Vice President of The Lincoln National
Life Insurance Company
Walter M. Korinke Vice President of Lincoln Investment Management, Inc.
Lawrence M. Lee Vice President of Lincoln Investment Management, Inc.
and Lincoln National Realty Corporation
Thomas A. McAvity, Vice President of Lincoln Investment Management, Inc.
Jr.
John David Moore Vice President of Lincoln Investment Management, Inc.
Oliver H. G. Nichols Vice President of Lincoln Investment Management, Inc.,
The Lincoln National Life Insurance Company and
Lincoln National Realty Corporation
David C. Patch Vice President of Lincoln Investment Management, Inc.
Joseph T. Pusateri Vice President of Lincoln Investment Management, Inc.
and Lincoln National Realty Corporation
Gregory E. Reed Vice President of Lincoln Investment Management, Inc.
*Business address is 200 East Berry Street, Fort Wayne, IN 46802.
xxi
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Positions and Offices with Lincoln Investment
Name and Principal Management, Inc. and its Affiliates and Other
Business Address* Positions and Offices Held
------------------ -------------------------------------------------------
Bill L. Sanders Vice President of Lincoln Investment Management, Inc.;
and Sales Vice President, The Lincoln National Life
Insurance Company.
Roy D. Shimer Vice President of Lincoln Investment Management, Inc.
Gerald M. Weiss Vice President of Lincoln Investment Management, Inc.
Jon A. Boscia Director (previously President) of Lincoln Investment
Management, Inc.; Director of Lincoln National
Foundation, Inc. and First Penn-Pacific Life Insurance
Company; President, Chief Operating Officer and
Director of The Lincoln National Life Insurance
Company; and President of Lincoln Financial Group, Inc.
Janet C. Whitney Vice President and Treasurer of Lincoln Investment
Management, Inc., The Financial Alternative, Inc.,
Financial Alternative Resources, Inc., Financial
Choices, Inc., Financial Investments, Inc., Financial
Investment Services, Inc., The Financial Resources
Department, Inc., Investment Alternatives, Inc., The
Investment Center, Inc., The Investment Group, Inc.,
LNC Administrative Services Corporation, LNC Equity
Sales Corporation, The Richard Leahy Corporation,
Lincoln National Aggressive Growth Fund, Inc., Lincoln
National Bond Fund, Inc., Lincoln National Capital
Appreciation Fund, Inc., Lincoln National Equity-Income
Fund, Inc., Lincoln National Global Assets Allocation
Fund, Inc., Lincoln National Growth and Income Fund,
Inc., Lincoln National Health & Casualty Insurance
Company, Lincoln National Intermediaries, Inc., Lincoln
National International Fund, Inc., Lincoln National
Managed Fund, Inc., Lincoln National Management
Services, Inc., Lincoln National Mezzanine Corporation,
Lincoln National Money Market Fund, Inc. Lincoln
National Realty Corporation, Lincoln National Risk
Management, Inc., Lincoln National Social Awareness
Fund, Inc., Lincoln National Special Opportunities
Fund, Inc., Lincoln National Structured Settlement,
Inc., Personal Financial Resources, Inc., Personal
Investment Services, Inc., Special Pooled Risk
Administrators, Inc., Underwriters & Management
Services, Inc.; Vice President and Treasurer
(previously Vice President and General Auditor) of
Lincoln National Corporation; and Assistant Treasurer
of First Penn-Pacific Life Insurance Company.
*Business address is 200 East Berry Street, Fort Wayne, IN 46802.
xxii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Positions and Offices with Lincoln Investment
Name and Principal Management, Inc. and its Affiliates and Other
Business Address* Positions and Offices Held
------------------ -------------------------------------------------------
C. Suzanne Womack Secretary of Lincoln Investment Management, Inc.,
Corporate Benefit Systems Services Corporation, The
Financial Alternative, Inc., Financial Alternative
Resources, Inc., Financial Choices, Inc., The Financial
Resources Department, Inc., Financial Investment
Services, Inc., Financial Investments, Inc., Insurance
Services, Inc., Investment Alternatives, Inc., The
Investment Center, Inc. (TN), The Investment Group,
Inc., LNC Administrative Services Corporation, LNC
Equity Sales Corporation, The Richard Leahy
Corporation, Lincoln Advisor Funds, Inc., Lincoln Life
Improved Housing, Inc., Lincoln National (China) Inc.,
Lincoln National Convertible Securities Fund, Inc.,
Lincoln National Health & Casualty Insurance Company,
Lincoln National Income Fund, Inc., Lincoln National
Intermediaries, Inc., Lincoln National Life Reinsurance
Company, Lincoln National Management Services, Inc.,
Lincoln National Mezzanine Corporation, Lincoln
National Realty Corporation, Lincoln National
Reassurance Company, Lincoln National Reinsurance
Company (Barbados) Limited, Lincoln National
Reinsurance Company Limited, Lincoln National Risk
Management, Inc., Lincoln National Structured
Settlement, Inc., Old Fort Insurance Company, Ltd.,
Personal Financial Resources, Inc., Personal Investment
Services, Inc., Professional Financial Planning, Inc.,
Reliance Life Insurance Company of Pittsburgh, Special
Pooled Risk Administrators, Inc. and Underwriters &
Management Services, Inc.; Vice President, Secretary
and Director of Lincoln National Foundation, Inc.;
Secretary and Assistant Vice President of Lincoln
National Corporation and The National Life Insurance
Company; and Assistant Secretary of Lincoln National
Aggressive Growth Fund, Inc., Lincoln National Bond
Fund, Inc., Lincoln National Capital Appreciation Fund,
Inc., Lincoln National Equity-Income Fund, Inc.,
Lincoln National Global Asset Allocation Fund, Inc.,
Lincoln National Growth and Income Fund, Inc., Lincoln
National International Fund, Inc., Lincoln National
Managed Fund, Inc., Lincoln National Money Market Fund,
Inc., Lincoln National Social Awareness Fund, Inc.,
Lincoln National Special Opportunities Fund, Inc. and
Lincoln National Variable Annuity Funds A & B.
*Business address is 200 East Berry Street, Fort Wayne, IN 46802.
xxiii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, 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 to
The Defensive Equity,
The Aggressive Growth,
The Fixed Income,
The Limited-Term
Maturity, The Defensive
Equity Small/Mid Cap,
The Defensive Equity
Utility, The High-Yield
Bond and The Real Estate
Investment Trust
Portfolios
Delaware Investment
Counselors, Inc. Limited Partner None
</TABLE>
* Business address is 1818 Market Street, Philadelphia, PA 19103.
** Business address is Veritas House, 125 Finsbury Pavement, London,
England EC2A 1NQ.
xxiv
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
<TABLE>
<CAPTION>
Name and Principal Position and Offices Position and Offices
Business Address* with Underwriter with Registrant
------------------ -------------------- --------------------
<S> <C> <C>
Winthrop S. Jessup Vice Chairman President and Chief
Executive Officer
Keith E. Mitchell President and Chief None
Executive Officer
David K. Downes Senior Vice President and Senior Vice President/
Chief Administrative Chief Administrative
Officer 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
Eric E. Miller Vice President/ Vice President/
Assistant Secretary Assistant Secretary
Richelle S. Maestro Vice President/ Vice President/
Assistant Secretary Assistant Secretary
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
xxv
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
<TABLE>
<CAPTION>
Name and Principal Position and Offices Position and Offices
Business Address* with Underwriter with Registrant
--------------------------- ------------------------- ------------------------
<S> <C> <C>
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 None
Resources
Denise F. Guerriere Vice President/Client None
Services
Julia R. Vander Els Vice President/ None
Retirement Services
Jerome J. Alrutz Vice President/ None
Retirement Services
Martin J. Cole Vice President/ None
Retirement Services
Joanne A. Mettenheimer Vice President/ None
National Accounts
Christopher H. Price Vice President/Annuity None
Marketing &
Administration
Thomas S. Butler Vice President/ None
DDI Administration
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
xxvi
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
<TABLE>
<CAPTION>
Name and Principal Position and Offices Position and Offices
Business Address* with Underwriter with Registrant
------------------ -------------------- --------------------
<S> <C> <C>
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
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
xxvii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
<TABLE>
<CAPTION>
Name and Principal Position and Offices Position and Offices
Business Address* with Underwriter with Registrant
------------------ ----------------------- --------------------
<S> <C> <C>
Sanford G. Simmons, Jr. Vice President/Wholesaler None
Robert E. Stansbury Vice President/Wholesaler None
Larry D. Stone Vice President/Wholesaler None
</TABLE>
*Business address of each is 1818 Market Street, Philadelphia, PA 19103.
(c) Not Applicable.
Item 30. Location of Accounts and Records.
--------------------------------
All accounts and records are maintained in the Philadelphia
office - 1818 Market Street, Philadelphia, PA 19103 or One
Commerce Square, Philadelphia, PA 19103.
Item 31. Management Services. None.
-------------------
xxviii
<PAGE>
Form N-1A
File No. 33-40991
Delaware Pooled Trust, Inc.
Item 32. Undertakings.
------------
(a) Not Applicable.
(b) The Registrant hereby undertakes to file a post-effective
amendment, using financial statements which need not be certified,
within four to six months from the initial public offering of
shares of The Defensive Equity Small/Mid-Cap, The Defensive Equity
Utility, The High-Yield Bond, The Labor Select International
Equity and The Real Estate Investment Trust Portfolios.
(c) The Registrant 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.
xxix
<PAGE>
SIGNATURES
----------
Pursuant to the requirements of the Securities Act of 1933 and the Investment
Company Act of 1940, this 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 20th day of
July, 1995.
DELAWARE POOLED TRUST, 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 July 20, 1995
-------------------------------
Wayne A. Stork
Senior Vice President/Chief
Administrative Officer/Chief
Financial Officer (Principal
Financial Officer and Principal
/s/David K. Downes Accounting Officer) July 20, 1995
------------------------------
David K. Downes
/s/Walter P. Babich Director July 20, 1995
------------------------------
Walter P. Babich
/s/Charles E. Peck Director July 20, 1995
------------------------------
Charles E. Peck
/s/Ann R. Leven Director July 20, 1995
------------------------------
Ann R. Leven
/s/W. Thacher Longstreth Director July 20, 1995
------------------------------
W. Thacher Longstreth
/s/Anthony D. Knerr Director July 20, 1995
------------------------------
Anthony D. Knerr
</TABLE>
<PAGE>
INDEX TO EXHIBITS
Exhibit No. Exhibit
----------- -------
EX-99.B1 Articles of Incorporation
EX-99.B2 By-Laws
EX-99.B5 Investment Management Agreements
EX-99.B6B Form of Administration and
(Module Name Service Agreement
ADMIN_SER_AGREE)
EX-99.B6C Dealer's Agreement
(Module Name
DEALERS_AGR)
EX-99.B6D Form of Mutual Fund Agreement
(Module Name
MUTUAL_FUND_AGR)
EX-99.B7 Amended and Restated Profit
(Module Name Sharing Plan
PROF_SHARE_PLAN)
EX-99.B16 Schedules of Computation for each
Portfolio
EX-27 Financial Data Schedules
EX-99.B19 Directors' Power of Attorney
EX-99.B20 Financial Statements
<PAGE>
Exhibit 99.B1
ARTICLES OF INCORPORATION
OF
DELAWARE POOLED TRUST, INC.
FIRST: The undersigned, Eric E. Miller, whose post office address is One
-----
Commerce Square, Philadelphia, Pennsylvania 19103 and being at least 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 Pooled Trust, 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 situated; and to build, erect, construct, alter and maintain
buildings, structures, and other improvements on real property.
5. To borrow or raise moneys for any of the purposes of the
corporation, and to mortgage or pledge the
<PAGE>
whole or any part of the property and franchises of the corporation, real,
personal, and mixed, tangible or intangible, and wheresoever situated.
6. To enter into, make and perform contracts and undertakings for
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, re-acquire 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
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).
-2-
<PAGE>
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 of
par value thereof, whichever is greater, for such consideration in such form 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 sub-series (classes) thereof, and to
classify or reclassify any unissued shares with respect to such series or sub-
series thereof, and such series and sub-series (subject to any applicable rule,
regulation or order of the Securities and Exchange Commission or other
applicable law or regulation) shall have such preference, 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, unless inconsistent with this Article FIFTH.
Subject to the aforesaid power of the Board of Directors, one series
of shares is hereby designated and classified as the Defensive Equity Portfolio
and Fifty Million (50,000,000) shares of Common Stock (par value $.01 per share)
are hereby initially classified and allocated to such series; a second series of
shares is hereby designated and classified as The Aggressive Growth Portfolio
and Fifty Million (50,000,000) shares of Common Stock (par value $.01 per share)
are hereby initially classified and allocated to such series; a third series of
shares is hereby designated and classified as the International Equity Portfolio
and Fifty Million (50,000,000) shares of Common Stock (par value $.01 per share)
are hereby initially classified and allocated to such series; a fourth series of
shares is hereby designated and classified as The Fixed Income Portfolio and
Fifty Million (50,000,000) shares of Common Stock (par value $.01 per share) are
hereby initially classified and allocated to such series; and a fifth series of
shares is hereby designated and classified as The Limited-Term Bond Portfolio
and Fifty Million (50,000,000) shares of Common Stock (par value $.01 per share)
are hereby initially classified and allocated to such series. At any time when
there are no shares outstanding or subscribed for a particular series or sub-
series previously established and designated herein or by the Board of
Directors, the series or sub-series may be eliminated by the Board of Directors
by the same means.
Each share of a series shall have equal rights with each other share
of that series with respect to the assets of
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<PAGE>
the corporation pertaining to that series. The dividends payable to the holders
of any sub-series (subject to any applicable rules, regulation or order of the
Securities and Exchange Commission or any other applicable law or regulation)
may be charged with any pro rata portion of distribution expenses paid pursuant
to a Plan of Distribution adopted by such sub-series in accordance with Rule
12b-1 under the Investment Company Act of 1940 (or any successor thereto), which
dividend shall be determined as directed 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 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 series except (1) when otherwise
expressly provided by the Maryland General Corporation Law; (2) when required by
the Investment Company Act of 1940, as amended, shares shall be voted by
individual series, or sub-series; and (3) when the matter does not affect any
interest of the particular series or sub-series, then only shareholders of
affected series or sub-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, profit and proceeds thereof, including any
proceeds derived from the sale, exchange or liquidation
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<PAGE>
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
belongings 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 of 1986, as amended, or any successor or comparable statute
thereof, 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.
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
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<PAGE>
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.
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 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 consist initially of three
directors until such time as the number of directors is fixed as stated above.
The names of the directors who shall act as such until successors are duly
chosen and qualified are: Wayne A. Stork, Winthrop S. Jessup, and George M.
Chamberlain, Jr.
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
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<PAGE>
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.
Notwithstanding anything in these Articles of Incorporation to the
contrary, the Board of Directors shall have power to establish in its absolute
discretion the basis or method for determining the value of the assets
belonging to any class or series, and the net asset value of each share of any
class or series of the corporation for purposes of sales, redemptions,
repurchases of shares or otherwise.
The net asset value of the property and assets of the corporation
shall be determined in accordance with the Investment Company Act of 1940, as
amended, and with generally accepted accounting principles, and at such times as
the Board of Directors may direct, by deducting from the total market or
appraised value of all of the property and assets of the corporation, 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 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).
The net asset value per share of a series of the Common Stock of the
corporation shall be determined by adding the total market or appraised value of
the property and assets of the relevant series of the corporation, 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 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.
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
<PAGE>
corporation or its designated agent during business hours of any business day,
provided that such request must be accompanied by surrender of any 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, if any. 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, and in accordance with the redemption procedures prescribed in the then
current Prospectus for the applicable series of shares of the corporation.
Payments 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 corporation'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, as amended, 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 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,
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<PAGE>
except the right of such stockholder to receive payment for such shares as
provided for herein.
For the purpose 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
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 national 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).
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 the 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 (30) 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: (a) To the fullest extent that limitations on the liability of
------
directors and officers are permitted by the Maryland General Corporation Law, no
director or officer of the corporation shall have any liability to the
corporation or its stockholders for damages. This limitation on liability
applies to events occurring at the time a person
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<PAGE>
serves as a director or officer of the corporation whether or not such person is
a director or officer at the time of any proceeding in which liability is
asserted.
(b) No provision of this Article shall be effective to protect or
purport to protect any director or officer of the corporation against any
liability to the corporation or its security holders to which he would otherwise
be subject by reason of willful misfeasance, bad faith, gross negligence or
reckless disregard of the duties involved in the conduct of his office.
(c) References to the Maryland General Corporation Law in this
Article are to the law as from time to time amended. No amendment to the
Articles of Incorporation of the corporation shall affect any right of any
person under this Article based on any event, omission or proceeding prior to
such amendment.
NINTH: 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.
TENTH: 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.
ELEVENTH: The corporation expressly agrees and acknowledges that the names
--------
"Delaware" and "Delaware Pooled Trust" are the sole property of Delaware
Management Company, Inc. ("DMC"), that similar names are used by funds in the
investment business which are affiliated with 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
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<PAGE>
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." The corporation further
expressly agrees and acknowledges in such event to use its best efforts to
comply promptly 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 Pooled Trust,
Inc. who executed the foregoing Articles of Incorporation hereby acknowledges
the same to be 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 29th day of May, 1991.
/s/ Eric E. Miller
-------------------
Eric E. Miller
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<PAGE>
DELAWARE POOLED TRUST, INC.
CONSENT OF SOLE STOCKHOLDER
Pursuant to the requirements of Section 2-505 of the Maryland General
Corporation Law governing actions taken by unanimous consent of stockholders,
the undersigned, being the sole stockholder of The Limited-Term Bond Portfolio
of Delaware Pooled Trust, Inc. (the "Corporation"), does hereby consent to,
approve and adopt the following resolution:
RESOLVED, that an amendment to the fourth paragraph of Article FIFTH of the
Articles of Incorporation of the Fund to change such paragraph to read as
follows:
Subject to the aforesaid power of the Board of Directors, one series
of shares is hereby designated and classified as The Defensive Equity
Portfolio and Fifty Million (50,000,000) shares of Common Stock (par
value $.01 per share) are hereby initially classified and allocated to
such series; a second series of shares is hereby designated and
classified as The Aggressive Growth Portfolio and Fifty Million
(50,000,000) shares of Common Stock (par value $.01 per share) are
hereby initially classified and allocated to such series; a third
series of shares is hereby designated and classified as The
International Equity Portfolio and Fifty Million (50,000,000) shares
of Common Stock (par value $.01 per share) are hereby initially
classified and allocated to such series; a fourth series of shares is
hereby designated and classified as The Fixed Income Portfolio and
Fifty Million (50,000,000) shares of Common Stock (par value $.01 per
share) are hereby initially classified and allocated to such series; a
fifth series of shares is hereby designated and classified as The
Limited-Term Maturity Portfolio and Fifty Million (50,000,000) shares
of Common Stock (par value $.01 per share) are hereby initially
classified and allocated to such series. At any time when there are
no shares outstanding or subscribed for a particular series or sub-
series previously established and designated herein or by the Board of
Directors, the series or sub-series may be eliminated by the Board of
Directors by the same means.
<PAGE>
IN WITNESS WHEREOF, the undersigned, being the sole stockholder of The
Limited-Term Bond Portfolio of Delaware Pooled Trust, Inc., has set its hand as
of the 9th day of October, 1991.
DELAWARE MANAGEMENT COMPANY, INC.
By:/s/George M. Chamberlain, Jr.
-----------------------------
George M. Chamberlain, Jr.
Vice President
Attest:
/s/Eric Miller
-------------------
Eric Miller
Assistant Secretary
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<PAGE>
DELAWARE POOLED TRUST, INC.
ARTICLES OF AMENDMENT
DELAWARE POOLED TRUST, INC., a Maryland corporation having its principal
office in Baltimore City, Maryland, and having its resident agent located at
Baltimore City, Maryland (hereinafter called the "Corporation"), hereby
certifies to the State Department of Assessments and Taxation of Maryland, that:
FIRST: The Articles of Incorporation of the Corporation are hereby
amended by deleting the fourth paragraph of Article FIFTH in its entirety and
inserting in lieu thereof the following paragraph:
Subject to the aforesaid power of the Board of Directors, one series
of shares is hereby designated and classified as The Defensive Equity
Portfolio and Fifty Million (50,000,000) shares of Common Stock (par value
$.01 per share) are hereby initially classified and allocated to such
series; a second series of shares is hereby designated and classified as
The Aggressive Growth Portfolio and Fifty Million (50,000,000) shares of
Common Stock (par value $.01 per share) are hereby initially classified and
allocated to such series; a third series of shares is hereby designated and
classified as The International Equity Portfolio and Fifty Million
(50,000,000) shares of Common Stock (par value $.01 per share) are hereby
initially classified and allocated to such series; a fourth series of
shares is hereby designated and classified as The Fixed Income Portfolio
and Fifty Million (50,000,000) shares of Common Stock (par value $.01 per
share) are hereby initially classified and allocated to such series; and a
fifth series of shares is hereby designated and classified as The Limited-
Term Maturity Portfolio and Fifty Million (50,000,000) shares of Common
Stock (par value $.01 per share) are hereby initially classified and
allocated to such series. At any time when there are no shares outstanding
or subscribed for a particular series or sub-series previously established
and designated herein or by the Board of Directors, the series or sub-
series may be eliminated by the Board of Directors by the same means.
SECOND: The Board of Directors of the Corporation, at a meeting duly
convened and held on September 19, 1991,
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<PAGE>
approved the foregoing amendment, declaring that the said
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<PAGE>
amendment was advisable and recommending that it be submitted to the sole
stockholder for approval.
THIRD: The amendment of the Articles of Incorporation of the Corporation
was approved by the consent of the sole stockholder pursuant to the requirements
of Section 2-505 of the Maryland General Corporation Law on October 9, 1991.
IN WITNESS WHEREOF, DELAWARE POOLED TRUST, INC. has caused these Articles
of Amendment to be signed in its name and on its behalf by its Vice President
and attested by its Assistant Secretary, on this 10th day of October, 1991.
Attest: DELAWARE POOLED TRUST, INC.
/s/Richard J. Flannery By:/s/Eric E. Miller
---------------------- -----------------
Richard J. Flannery Eric E. Miller
Assistant Secretary Vice President
THE UNDERSIGNED, Vice President of DELAWARE POOLED TRUST, 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 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/Eric E. Miller
-----------------
Eric E. Miller
Vice President
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<PAGE>
DELAWARE POOLED TRUST, INC.
ARTICLES SUPPLEMENTARY
TO
ARTICLES OF INCORPORATION
Delaware Pooled Trust, 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 held
on July 16, 1992, adopted a resolution designating a series of common stock of
the Corporation as The Global Income Portfolio and classified and allocated
Fifty Million (50,000,000) shares of unissued an unallocated Common Stock, with
a par value of One Cent ($.01) per share, to The Global Income Portfolio.
SECOND: The shares of The Global Income Portfolio shall have the
rights and privileges, and shall be subject to the limitations and priorities
set forth in the Articles of Incorporation of the Corporation.
THIRD: The shares of said Global Income Portfolio have been
classified by the Board of Directors pursuant to authority contained in the
Articles of Incorporation of the Corporation.
IN WITNESS WHEREOF, Delaware Pooled Trust, Inc. has caused these Articles
Supplementary to be signed in its name and on its behalf this 18th day of
August, 1992.
DELAWARE POOLED TRUST, INC.
By:/s/George M. Chamberlain, Jr.
-----------------------------
George M. Chamberlain, Jr.
Vice President
Attest:
/s/Eric Miller
-------------------
Eric Miller
Assistant Secretary
<PAGE>
THE UNDERSIGNED, Vice President of Delaware Pooled Trust, Inc., who
executed on behalf of said Corporation the foregoing Articles Supplementary of
which this instrument is made a part, hereby acknowledges, in the name 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.
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<PAGE>
DELAWARE POOLED TRUST, INC.
ARTICLES SUPPLEMENTARY
TO
ARTICLES OF INCORPORATION
Delaware Pooled Trust, 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 held
on September 17, 1992, adopted a resolution reclassifying the authorized but
unissued shares currently designated as The Global Income Portfolio as The
Global Fixed Income Portfolio.
SECOND: The shares of The Global Fixed Income Portfolio shall have
the rights and privileges, and shall be subject to the limitations and
priorities set forth in the Articles of Incorporation of the Corporation.
THIRD: The shares of said Global Fixed Income Portfolio have been
reclassified by the Board of Directors pursuant to authority contained in the
Articles of Incorporation of the Corporation.
IN WITNESS WHEREOF, Delaware Pooled Trust, Inc. has caused these Articles
Supplementary to be signed in its name and on its behalf this 21st day of
September, 1992.
DELAWARE POOLED TRUST, INC.
By:/s/George M. Chamberlain, Jr.
-----------------------------
George M. Chamberlain, Jr.
Vice President
Attest:
/s/Eric E. Miller
-----------------
Eric E. Miller
Assistant Secretary
<PAGE>
THE UNDERSIGNED, Vice President of Delaware Pooled Trust, Inc., who
executed on behalf of said Corporation the foregoing Articles Supplementary of
which this instrument is made a part, hereby acknowledges, in the name 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 materials respects, under the penalties of
perjury.
/s/George M. Chamberlain, Jr.
-----------------------------
George M. Chamberlain, Jr.
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<PAGE>
DELAWARE POOLED TRUST, INC.
ARTICLES SUPPLEMENTARY
TO
ARTICLES OF INCORPORATION
Delaware Pooled Trust, 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 held
on July 15, 1993, adopted a resolution designating a new series of Common Stock
of the Corporation as The Global Equity Portfolio and classifying and allocating
Fifty Million (50,000,000) shares of authorized, unissued and unclassified
Common Stock, with a par value of One Cent ($.01) per share, to The Global
Equity Portfolio.
SECOND: The shares of The Global Equity Portfolio shall have the
rights and privileges, and shall be subject to the limitations and priorities,
set forth in the Articles of Incorporation of the Corporation.
THIRD: The shares of The Global Equity Portfolio have been
classified by the Board of Directors pursuant to authority contained in the
Articles of Incorporation of the Corporation.
IN WITNESS WHEREOF, Delaware Pooled Trust, Inc. has caused these Articles
Supplementary to be signed in its name and on its behalf this 3rd day of August,
1993.
DELAWARE POOLED TRUST, INC.
By:/s/George M. Chamberlain, Jr.
-----------------------------
George M. Chamberlain, Jr.
Vice President
Attest:
/s/Eric E. Miller
-----------------
Eric E. Miller
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<PAGE>
Assistant Secretary
THE UNDERSIGNED, Vice President of DELAWARE POOLED TRUST, Inc., who
executed on behalf of said Corporation the foregoing Articles Supplementary of
which this instrument is made a part, hereby acknowledges, in the name 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 materials respects, under the penalties of
perjury.
/s/George M. Chamberlain, Jr.
-----------------------------
George M. Chamberlain, Jr.
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<PAGE>
DELAWARE POOLED TRUST, INC.
ARTICLES SUPPLEMENTARY
TO
ARTICLES OF INCORPORATION
Delaware Pooled Trust, 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 held
on November 18, 1993, adopted a resolution designating a new series of Common
Stock of the Corporation as The International Fixed Income Portfolio and
classifying and allocating Fifty Million (50,000,000) shares of authorized,
unissued an unclassified Common Stock, with a par value of One Cent ($.01) per
share, to The International Fixed Income Portfolio.
SECOND: The shares of The International Equity Portfolio shall have
the rights and privileges, and shall be subject to the limitations and
priorities, set forth in the Articles of Incorporation of the Corporation.
THIRD: The shares of The International Equity Portfolio have been
classified by the Board of Directors pursuant to authority contained in the
Articles of Incorporation of the Corporation.
IN WITNESS WHEREOF, Delaware Pooled Trust, Inc. has caused these Articles
Supplementary to be signed in its name and on its behalf this 12th day of
October, 1994.
DELAWARE POOLED TRUST, INC.
By:/s/Andrew L. Gangolf, III
-------------------------
Andrew L. Gangolf, III
Vice President
Attest:
/s/Eric Miller
------------------
Eric Miller
Assistant Secretary
<PAGE>
THE UNDERSIGNED, Vice President of DELAWARE POOLED TRUST, INC., who
executed on behalf of said Corporation the foregoing Articles Supplementary of
which this instrument is made a part, hereby acknowledges, in the name 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/Andrew L. Gangolf, III
-------------------------
Andrew L. Gangolf, III
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<PAGE>
DELAWARE POOLED TRUST, INC.
FORM OF ARTICLES SUPPLEMENTARY
TO
ARTICLES OF INCORPORATION
Delaware Pooled Trust, 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 held on
July 20, 1995, and in accordance with Section 2-105(c) of the Maryland General
Corporation Law, adopted a resolution increasing the aggregate number of shares
of common stock, par value One Cent ($0.01) per share of the Corporation
("Common Stock"), that the Corporation has authority to issue from 500 Million
shares to One Billion (1,000,000,000) shares.
SECOND: The Board of Directors of the Corporation, at a meeting held on
July 20, 1995, adopted a resolution designating five additional series of the
Corporation's Common Stock as The Defensive Equity Small/Mid-Cap Portfolio, The
Defensive Equity Utility Portfolio, The High-Yield Bond Portfolio, The Labor
Select International Equity Portfolio and The Real Estate Investment Trust
Portfolio (collectively, the "Series"), and classifying and allocating Fifty
Million (50,000,000) shares of authorized, unissued and unclassified Common
Stock to each such series.
THIRD: The holders of shares of the Series shall each have the rights and
privileges, and shall be subject to the limitations and priorities, set forth in
the Articles of Incorporation of the Fund.
<PAGE>
FOURTH: The shares of the Series have been classified by the Board of
Directors pursuant to authority contained in the Articles of Incorporation of
the Corporation.
IN WITNESS WHEREOF, Delaware Pooled Trust, Inc. has caused these Articles
Supplementary to be signed in its name and on its behalf this ____ day of
September, 1995.
DELAWARE POOLED TRUST, INC.
By:_____________________________________
George M. Chamberlain, Jr.
Senior Vice President
ATTEST:
_______________________________
Assistant Secretary
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<PAGE>
THE UNDERSIGNED, Senior Vice President of DELAWARE POOLED TRUST, 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
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<PAGE>
Exhibit 99.B2
DELAWARE POOLED TRUST, INC.
BY-LAWS
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 other legal
representatives, duly authenticated evidence or their authority shall be
produced, and may be required to be deposited and remain with the Corporation or
its duly authorized transfer agent. No transfer shall be made unless and until
the certificate issued to the transferor, if any, shall be delivered to 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 of 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
<PAGE>
require, give the Corporation a bond or indemnity, in such form and with such
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. (a) The Corporation is not required to hold an Annual Meeting
in any year in which the Corporation is not required to elect directors under
the Investment Company Act of 1940. If the Corporation is required under the
Investment Company Act of 1940 to hold a stockholder meeting to elect directors,
the meeting shall be designated an Annual Meeting of Stockholders for that year
for purposes of Maryland law.
(b) Annual Meetings, if held, shall be held at such place and
time as the Board of Directors may by resolution establish, and shall be held no
later than 120 days after the occurrence of the event requiring the meeting. In
the absence of any specific resolution, Annual Meeting of Stockholders shall be
held at the Corporation's principal office, or at such other place within or
without the State of Maryland as the Board of Directors may from time to time
prescribe. Meetings of stockholders for any other purpose may be held at such
place and time as shall be fixed by resolution of the Board of Directors and
stated in the Notice of the Meeting, or in a duly executed Waiver of Notice
thereof.
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
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<PAGE>
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.
Section 3. Notice of the time and place of the annual or any special
meeting of the stockholders shall be given to each stockholder entitled to
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 notice.
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
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<PAGE>
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 any 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 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 may 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 as otherwise provided in the
Investment Company Act of 1940, and also 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;
and 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
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<PAGE>
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.
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 the power to fill vacancies
occurring on the Board, whether by death, resignation or otherwise. A vacancy
on the Board of Directors resulting from any 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, whenever
held, or special meeting called for that purpose, and until his successor is
elected and qualifies.
Section 5. The Board of Directors shall have power to appoint, and at its
discretion to remove or suspend, any officers, managers, superintendents,
subordinates,
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<PAGE>
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.
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 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.
Section 9. The Board of Directors shall have power to fix, and from time
to time 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.
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<PAGE>
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. 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 meeting.
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 removed at any time, either with or without cause, by action by the Board
of Directors.
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<PAGE>
ARTICLE VII
INDEMNIFICATION OF OFFICERS AND DIRECTORS
Section 1. The Corporation shall indemnify each officer and director made
part 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 standards 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 of this Article VII
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.
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.
ARTICLE VIII
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 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.
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<PAGE>
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 removed 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.
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
other 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.
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<PAGE>
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 IX
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.
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 to the order of the Corporation.
ARTICLE X
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.
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<PAGE>
ARTICLE XI
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 its 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 XII
FISCAL YEAR
Section 1. The fiscal year of the Corporation shall end on the last day in
October of each year.
ARTICLE XIII
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.
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ARTICLE XIV
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.
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DELAWARE POOLED TRUST, INC.
CERTIFICATION OF AMENDMENT TO BY-LAWS
AMENDING SECTION 2 OF ARTICLE VI
NOVEMBER 21, 1991
The Undersigned Secretary of Delaware Pooled Trust, 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 by-laws 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 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 our 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.
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DELAWARE POOLED TRUST, INC.
CERTIFICATION OF AMENDMENT TO BY-LAWS
AMENDING SECTION 8 OF ARTICLE IV
JULY 22, 1991
The Undersigned Secretary of Delaware Pooled Trust, 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.
-14-
<PAGE>
Exhibit 99.B5
DELAWARE POOLED TRUST, INC.
THE LIMITED-TERM MATURITY PORTFOLIO
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, made by and between DELAWARE POOLED TRUST, INC., Maryland
corporation (the "Fund"), for THE LIMITED-TERM MATURITY PORTFOLIO (the
"Portfolio"), 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 for the Portfolio dated as of the 12th day of
November, 1991; and
WHEREAS, the Board of Directors of the Fund and shareholders of the
Portfolio have determined to enter into a new Investment
<PAGE>
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 Portfolio's 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 Portfolio
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
Portfolio's investments as the Investment Manager deems appropriate or as the
Directors of the Fund may reasonably request.
2
<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; taxes; and federal and state
registration fees. 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 funds 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
3
<PAGE>
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
4
<PAGE>
brokerage and research services 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
and other advisory accounts 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 Portfolio's assets, a fee (at an annual
rate) equal to .30% of the daily average net assets of the Portfolio during the
month, less the Portfolio's 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 portfolios 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 10 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
5
<PAGE>
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 Portfolio. It shall continue in effect for a period of two
years 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 Portfolio and only if
the terms and the renewal hereof have
6
<PAGE>
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 Portfolio 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 Portfolio. The Investment Manager may terminate this Agreement at any
time, without the payment of a 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.
7
<PAGE>
9. This Agreement shall extend to and bind the heirs, executors,
administrators and successors of the parties hereto.
10. 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 1940.
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.
Attest: DELAWARE POOLED TRUST, INC.
for THE LIMITED-TERM MATURITY
PORTFOLIO
/s/Richelle S. Maestro By:/s/Wayne A. Stork
----------------------- -------------------
Richelle S. Maestro Wayne A. Stork
Attest: DELAWARE MANAGEMENT COMPANY, INC.
/s/Eric E. Miller By:/s/Brian F. Wruble
-------------------- ---------------------
Eric E. Miller Brian F. Wruble
8
<PAGE>
DELAWARE POOLED TRUST, INC.
THE INTERNATIONAL FIXED INCOME PORTFOLIO
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, made by and between DELAWARE POOLED TRUST, INC., a Maryland
corporation (the "Fund") for THE INTERNATIONAL FIXED INCOME PORTFOLIO (the
"Portfolio") and DELAWARE INTERNATIONAL ADVISERS LTD., a U.K. company (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 for the Portfolio dated as of the 28th day of
February, 1994; and
WHEREAS, the Board of Directors of the Fund and shareholders of the
Portfolio have determined to enter into a new Investment
<PAGE>
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 Portfolio's 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 Portfolio,
shall effect the purchase and sale of investments in furtherance of the
Portfolio's objectives and policies, and shall furnish the Board of Directors of
the Fund with such information and reports regarding the Portfolio's investments
as the Investment Manager deems appropriate or as the Directors of the Fund may
reasonably request.
-2-
<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; taxes; and federal and state
registration fees.
3. (a) Subject to the primary objective of obtaining the best available
prices and execution, the Investment Manager will place orders for the purchase
and sale of portfolio securities with such broker/dealers 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 International Advisers Ltd. 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
-3-
<PAGE>
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
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 and other advisory accounts 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 Portfolio's assets a fee (at an annual
rate) equal to .50% of the average daily net assets of the Portfolio during the
month.
If this Agreement is terminated prior to the end of any calendar month, the
management fee shall be prorated for the
-4-
<PAGE>
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 10 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.
-5-
<PAGE>
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 Portfolio. It shall continue in effect for a period of two
years 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 Portfolio and only if
the 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 Portfolio 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 Portfolio. The Investment Manager
may terminate this Agreement at any time, without the payment of a penalty on
sixty days' written notice to the Fund of
-6-
<PAGE>
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.
10. 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 1940.
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.
Attest: DELAWARE POOLED TRUST, INC.
for THE INTERNATIONAL FIXED INCOME
PORTFOLIO
/s/Richelle S. Maestro By: /s/Wayne A. Stork
----------------------- -------------------------------
Richelle S. Maestro Wayne A. Stork
Attest: DELAWARE INTERNATIONAL ADVISERS LTD.
/s/John Emberson By: /s/David G. Tilles
----------------------- -------------------------------
John Emberson David G. Tilles
-7-
<PAGE>
8
<PAGE>
DELAWARE POOLED TRUST, INC.
THE INTERNATIONAL EQUITY PORTFOLIO
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, made by and between DELAWARE POOLED TRUST, INC., a Maryland
corporation (the "Fund") for THE INTERNATIONAL EQUITY PORTFOLIO (the
"Portfolio") and DELAWARE INTERNATIONAL ADVISERS LTD., a U.K. company (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 for the Portfolio dated as of the 21st day of
November, 1991; and
WHEREAS, the Board of Directors of the Fund and shareholders of the
Portfolio have determined to enter into a new Investment Management Agreement
with the Investment Manager to be effective as of the date hereof.
<PAGE>
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 Portfolio's 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 a 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 Portfolio,
shall effect the purchase and sale of investments in furtherance of the
Portfolio's objectives and policies and shall furnish the Board of Directors of
the Fund with such information and reports regarding the Portfolio's investments
as the Investment Manager deems appropriate or as the Directors of the Fund may
reasonably request.
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 ad 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
-2-
<PAGE>
shareholders' meetings; miscellaneous office expenses; brokerage commissions;
custodian fees; legal and accounting fees; taxes; and federal and state
registration fees.
3. (a) Subject to the primary objective of obtaining the best available
prices and execution, the Investment Manager will place orders for the purchase
and sale of portfolio securities with such broker/dealers 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 International Advisers Ltd. 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
provided by such member, broker or dealer, viewed in terms of either that
particular transaction or the
-3-
<PAGE>
Investment Manager's overall responsibilities with respect to the Fund and to
other funds and other advisory accounts 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 Portfolio's assets, a fee (at an annual
rate) equal to .75% of the daily average net assets of the Portfolio during the
month, less the Portfolio's 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 Portfolios 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 10 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.
-4-
<PAGE>
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 Portfolio. It shall continue in effect for a period of two
years 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 Portfolio and only if
the 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 Portfolio 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
-5-
<PAGE>
the Portfolio. The Investment Manager may terminate this Agreement at any time,
without the payment of a 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.
10. 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 1940.
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.
Attest: DELAWARE POOLED TRUST, INC. for THE
INTERNATIONAL EQUITY PORTFOLIO
/s/Richelle S. Maestro By:/s/Wayne A. Stork
---------------------------- -------------------------------
Richelle S. Maestro Wayne A. Stork
Attest: DELAWARE INTERNATIONAL ADVISERS LTD.
/s/John Emberson By:/s/David G. Tilles
--------------------------- -------------------------------
John Emberson David G. Tilles
-6-
<PAGE>
DELAWARE POOLED TRUST, INC.
THE GLOBAL FIXED INCOME PORTFOLIO
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, made by and between DELAWARE POOLED TRUST, INC., a Maryland
corporation (the "Fund"), for THE GLOBAL FIXED INCOME PORTFOLIO (the
"Portfolio"), and DELAWARE INTERNATIONAL ADVISERS LTD., a U.K. company (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 for the Portfolio dated as of the 2nd day of
November, 1992; and
WHEREAS, the Board of Directors of the Fund and shareholders of the
Portfolio have determined to enter into a new Investment Management Agreement
with the Investment Manager to be effective as of the date hereof.
<PAGE>
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 Portfolio's 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 Portfolio,
shall effect the purchase and sale of investments in furtherance of the
Portfolio's objectives and policies and shall furnish the Board of Directors of
the Fund with such information and reports regarding the Portfolio's investments
as the Investment Manager deems appropriate or as the Directors of the Fund may
reasonably request.
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;
-2-
<PAGE>
legal and accounting fees; taxes; and federal and state registration fees.
3.(a) Subject to the primary objective of obtaining the best available
prices and execution, the Investment Manager will place orders for the purchase
and sale of portfolio securities with such broker/dealers 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 International Advisers Ltd. 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
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 and other advisory accounts
-3-
<PAGE>
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 Portfolio's assets a fee (at an annual
rate) equal to .50% of the average daily net assets of the Portfolio during the
month, less the Portfolio's 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 portfolios 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 10 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
-4-
<PAGE>
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 Portfolio. It shall continue in effect for a period of two
years 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 Portfolio and only if
the 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 Portfolio 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 Portfolio. The Investment Manager
may terminate this Agreement at any time, without the payment of a 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
-5-
<PAGE>
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.
10. 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 1940.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement by
having it be signed by their duly authorized officers as of the 3rd day of
April, 1995.
Attest: DELAWARE POOLED TRUST, INC. for
THE GLOBAL FIXED INCOME PORTFOLIO
/s/Richelle S. Maestro By:/s/Wayne A. Stork
------------------------------ ---------------------------
Richelle S. Maestro Wayne A. Stork
Attest: DELAWARE INTERNATIONAL ADVISERS LTD.
/s/John Emberson By:/s/David G. Tilles
----------------------------- --------------------------------
John Emberson David G. Tilles
-6-
<PAGE>
DELAWARE POOLED TRUST, INC.
THE FIXED INCOME PORTFOLIO
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, made by and between DELAWARE POOLED TRUST, INC., a Maryland
corporation (the "Fund"), for THE FIXED INCOME PORTFOLIO (the "Portfolio"), 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 for the Portfolio dated as of the 12th day of
November, 1991; and
WHEREAS, the Board of Directors of the Fund and shareholders of the
Portfolio have determined to enter into a new Investment Management Agreement
with the Investment Manager to be effective as of the date hereof.
<PAGE>
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 Portfolio's 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 Portfolio
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
Portfolio's investments as the Investment Manager deems appropriate or as the
Directors of the Fund may reasonably request.
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
-2-
<PAGE>
shareholders' meetings; miscellaneous office expenses; brokerage commissions;
custodian fees; legal and accounting fees; taxes; and federal and state
registration fees. 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 funds 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
-3-
<PAGE>
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
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 and other advisory accounts 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 Portfolio's assets, a fee (at an annual
rate) equal to .40% of the daily average net assets of the Portfolio during the
month, less the Portfolio's 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 portfolios of the Fund.
If this Agreement is terminated prior to the end of any calendar mouth, 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
-4-
<PAGE>
Agreement is in effect bears to the number of calendar days in the month, and
shall be payable within 10 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 Portfolio. It shall continue in effect for a period of two
years 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
-5-
<PAGE>
Portfolio and only if the 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 Portfolio 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
Portfolio. The Investment Manager may terminate this Agreement at any time,
without the payment of a 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.
-6-
<PAGE>
10. 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 1940.
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.
Attest: DELAWARE POOLED TRUST, INC.
for THE FIXED INCOME PORTFOLIO
/s/Richelle S. Maestro By:/s/Wayne A. Stork
-------------------------- --------------------------
Richelle S. Maestro Wayne A. Stork
Attest: DELAWARE MANAGEMENT COMPANY, INC.
/s/Eric E. Miller By:/s/Brian F. Wruble
--------------------- -------------------------------
Eric E. Miller Brian F. Wruble
<PAGE>
DELAWARE POOLED TRUST, INC.
THE DEFENSIVE EQUITY PORTFOLIO
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, made by and between DELAWARE POOLED TRUST, INC., a Maryland
corporation (the "Fund"), for THE DEFENSIVE EQUITY PORTFOLIO (the "Portfolio"),
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 for the Portfolio dated as of the 12th day of
November, 1991; and
WHEREAS, the Board of Directors of the Fund and shareholders of the
Portfolio have
<PAGE>
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 Portfolio's 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 Portfolio
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
Portfolio's investments as the Investment Manager deems appropriate or as the
Directors of the Fund may reasonably request.
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
<PAGE>
certificates; reports and notices to shareholders; calling and holding of
shareholders' meetings; miscellaneous office expenses; brokerage commissions;
custodian fees; legal and accounting fees; taxes; and federal and state
registration fees. 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 funds 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
3
<PAGE>
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
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 and other advisory accounts 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 Portfolio's assets, a fee (at an annual
rate) equal to .55% of the daily average net assets of the Portfolio during the
month, less the Portfolio's 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 portfolios 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
4
<PAGE>
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 10 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 Portfolio. It shall continue in effect for a period of two
years 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
5
<PAGE>
by vote of a majority of the outstanding voting securities of the Portfolio and
only if the 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 Portfolio 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 Portfolio. The Investment
Manager may terminate this Agreement at any time, without the payment of a
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.
6
<PAGE>
10. 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 1940.
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.
Attest: DELAWARE POOLED TRUST, INC.
for THE DEFENSE EQUITY PORTFOLIO
/s/Richelle S. Maestro By:/s/Wayne A. Stork
-------------------------- ------------------------
Richelle S. Maestro Wayne A. Stork
Attest: DELAWARE MANAGEMENT COMPANY, INC.
/s/Eric E. Miller By:/s/ Brian F. Wruble
-------------------- -------------------------
Eric E. Miller Brian F. Wruble
7
<PAGE>
DELAWARE POOLED TRUST, INC.
THE AGGRESSIVE GROWTH PORTFOLIO
INVESTMENT MANAGEMENT AGREEMENT
AGREEMENT, made by and between DELAWARE POOLED TRUST, INC., a Maryland
corporation (the "Fund"), for THE AGGRESSIVE GROWTH PORTFOLIO (the "Portfolio"),
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 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 for the Portfolio dated as of the 21st day of
November, 1991; and
WHEREAS, the Board of Directors of the Fund and shareholders of the
Portfolio have
<PAGE>
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 Portfolio's 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 Portfolio
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
Portfolio's investments as the Investment Manager deems appropriate or as the
Directors of the Fund may reasonably request.
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
<PAGE>
certificates; reports and notices to shareholders; calling and holding of
shareholders' meetings; miscellaneous office expenses; brokerage commissions;
custodian fees; legal and accounting fees; taxes; and federal and state
registration fees. 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 funds 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
3
<PAGE>
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
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 and other advisory accounts 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 Portfolio's assets, a fee (at an annual
rate) equal to .80% of the daily average net assets of the Portfolio during the
month, less the Portfolio's 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 portfolios 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
4
<PAGE>
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 10 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 Portfolio. It shall continue in effect for a period of two
years and may be renewed thereafter only so long as such renewal and continuance
is specifically approved at least annually by the Board of
5
<PAGE>
Directors or by vote of a majority of the outstanding voting securities of the
Portfolio and only if the 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 Portfolio 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
Portfolio. The Investment Manager may terminate this Agreement at any time,
without the payment of a 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.
6
<PAGE>
10. 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 1940.
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 POOLED TRUST, INC.
for THE AGGRESSIVE GROWTH PORTFOLIO
Attest: /s/Richelle S. Maestro By:/s/Wayne A. Stork
---------------------- ---------------------------
Richelle S. Maestro Wayne A. Stork
DELAWARE MANAGEMENT COMPANY, INC.
Attest: /s/Eric E. Miller By:/s/Brian F. Wruble
------------------------ ------------------
Eric E. Miller Brian F. Wruble
7
<PAGE>
__________________________________
Administration and Service Agreement
Gentlemen:
This Administration and Service Agreement ("Agreement") has been adopted
pursuant to Rule 12b-1 under the Investment Company Act of 1940 (the "Act") by
each fund in the _____________________ listed on Exhibit A hereto (each
individually a "Fund" and collectively the "Funds"), as part of a plan pursuant
to said rule (each individually a "Plan" and collectively the "Plans"). Each
Plan has been approved by a majority of the Directors or Trustees, as relevant,
who are not interested persons of the Fund and who have no direct or indirect
financial interest in the operation of the Plan (the "non-interested
Directors"), cast in person at a meeting called for the purpose of voting on
such Plan. Such approval included a determination that in the exercise of the
reasonable business judgment of each Board of Directors or Trustees and in light
of the Directors' or Trustees' fiduciary duties, there is a reasonable
likelihood that the Plan will benefit each Fund and its shareholders. Each Plan
and the compensation to be paid under such Plan has also been approved by a vote
of at least a majority of the outstanding voting securities of such Fund, as
defined in the Act.
The Plan(s) and this Agreement shall continue in effect for a period of
more than one year from the date of execution or adoption only so long as such
continuance is approved at least annually by the non-interested Directors or
Trustees in the manner described in the preceding paragraph. In voting to
continue a Plan, Directors and Trustees have a duty to request and evaluate, and
any contra party hereto has a duty to furnish, such information as may
reasonably be necessary to an informed determination of whether the Plan should
be continued. Similarly, in voting to continue a Plan, Directors or Trustees
must conclude, in the exercise of their reasonable business judgment and in
light of their fiduciary duties, that there is a reasonable likelihood that the
Plan will benefit the Fund and its shareholders.
TERMS
1. To the extent you provide administrative and other services, including,
but not limited to, furnishing personal and other services and assistance to
your customers who own Fund shares, answering routine inquiries regarding a
Fund, assisting in changing account designations and addresses, maintaining such
<PAGE>
accounts or such other services as a Fund may require, to the extent permitted
by applicable statutes, rules, or regulations, we shall pay you a fee based on
the value of the shares of each Fund which are attributable to customers of your
firm (all such shares being hereinafter referred to as "qualified assets")
calculated on the basis and at the rate set forth in the Schedule attached
hereto and made a part of this Agreement (the "Schedule").
2. Without prior approval by a majority of the outstanding shares of a
Fund, the aggregate annual fees paid to you pursuant to the Schedule attached
hereto shall not exceed the amount stated as the "annual maximum" on the
Schedule, which amount shall be a specified percent of the value of the Fund's
net assets held in your customers' accounts which are eligible for payment
pursuant to this Agreement (determined in the same manner as each Fund uses to
compute its net assets as set forth in its effective Prospectus).
3. You shall furnish us and each Fund with such information as shall
reasonably be requested by the Board of Directors or Trustees with respect to
the fees paid to you pursuant to the Schedule.
4. We shall furnish to the Board of Directors or Trustees, for their
review, on a quarterly basis, a written report of the amounts expended under the
Plan by us with respect to the relevant Fund and the purposes for which such
expenditures were made.
5. As to a Fund, this Agreement may be terminated by us or by you, by the
vote of a majority of the Directors or Trustees with responsibility for such
Fund who are non-interested Directors, or by a vote of a majority of the
outstanding voting securities of such Fund, on sixty (60) days' written notice
all without payment of any penalty. This Agreement shall also be terminated
automatically by any act that terminates a Fund's Underwriting Agreement with
its Underwriter or a Fund's Management Agreement with its manager.
6. Any obligation assumed by a Fund pursuant to this Agreement shall be
limited in all cases to the assets of such Fund and no person shall seek
satisfaction thereof from shareholders of a Fund.
7. The provisions of the Plan between each Fund and us, insofar as they
relate to you, are incorporated herein by reference.
8. This Agreement shall take effect on the date set forth on the attached
Schedule.
<PAGE>
9. The terms and provisions of the current Prospectus and Statement of
Additional Information for each relevant Fund are hereby accepted and agreed to
by the parties hereto as evidenced by our execution hereof.
GENERAL
10. Governing Law. This Agreement will be governed by and construed in
accordance with the law of the State of ____________, without reference to that
state's choice of law doctrine.
11. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but such
counterparts shall, together, constitute only one Agreement.
12. Severability. In the event that any provision of this Agreement, or the
application of any such provision to any person or set of circumstances, shall
be determined to be invalid, unlawful, void or unenforceable to any extent, the
remainder of this Agreement, and the application of such provision to persons or
circumstances other than those as to which it is determined to be invalid,
unlawful, void or unenforceable, shall not be impaired or otherwise affected and
shall continue to be valid and enforceable to the fullest extent permitted by
law.
13. Entire Agreement. This Agreement sets forth the entire understanding of
the parties hereto and supersedes all prior agreements and understandings
between the parties hereto relating to the subject matter hereof.
14. Headings. The underlined headings contained herein are for convenience
of reference only, shall not be deemed to be a part of this Agreement and shall
not be referred to in connection with the interpretation hereof.
________________________________________________
By: ______________________________
Agreed and Accepted:
______________________________
(Name)
By: __________________________
(Authorized Officer)
<PAGE>
________________________________________
SCHEDULE TO ADMINISTRATION AND SERVICE AGREEMENT
________________________________________
AND
Pursuant to the provisions of the Administration and Service Agreement
between the above parties, each Fund listed below shall pay a fee to the
above-named party based on the net asset value of each Fund's shares during the
period indicated which are attributable to the above-named party calculated as
follows:
Frequency of
Name of Fund Amount Reimbursement
------------ ------ -------------
______________________________ _____________________________________
(Name)
By:___________________________ By:__________________________________
(Authorized Officer)
Dated:________________________
<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>
MUTUAL FUND AGREEMENT
FOR THE DELAWARE GROUP OF FUNDS
Gentlemen:
We are the national distributor for the Delaware Group of Funds with exclusive
right to sell and distribute Fund shares. (The term "Funds" in this Agreement
refers to each or any of the Funds that from time to time comprise the Delaware
Group and for whom we act as distributor.) You have indicated that you wish to
act as agent for your customers in connection with the purchase, sale and
redemption of Fund shares and desire to provide certain services to your
customers relating to their ownership of Fund shares, all in accordance with the
terms of this Agreement.
AGENT FOR CUSTOMERS: In placing orders for the purchase and sale of Fund shares,
you will be acting as agent for your customers and will not have any authority
to act as agent for us, any of the Funds or any of our affiliates or
representatives. Neither you nor any of your employees or agents are authorized
to make any representations concerning the Funds or Fund shares except those
contained in the then current "Prospectus" and in written information issued by
the Fund or by us as a supplement to the Prospectus. In purchasing Fund shares
your customers may rely only on such authorized information.
OFFERING PRICE TO PUBLIC: Orders for shares received from you and accepted by
the Fund or its agent, Delaware Service Co. Inc., will be at the public offering
price applicable to each order as set forth in the Prospectus. The manner of
computing the net asset value, 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, without notice, to suspend the sale of Fund
shares or withdraw the public offering.
SALES, ORDERS AND CONFIRMATIONS: All orders must be made subject to
confirmation. Your orders must be wired, telephoned or written to the Fund or
its agent. You agree to place orders on behalf of your customers for the number
of shares, and at the price, as in bona fide orders from your customers. We will
not accept any conditional orders. We will send a written confirmation of each
trade indicating that the trade was on a fully disclosed basis to your customer.
It is agreed and understood that, whether shares are registered in the
purchaser's name, in your name or in the name of your nominee, your customer
will have full beneficial ownership of the Fund shares.
AGENCY FEES: On each order accepted by us for a Fund with a sales charge, we
understand that you will charge your customer an agency commission or agency
transaction fee ("agency fee") as set forth in the schedule of sales concessions
and agency fees set forth in that Fund's Prospectus, as it may be amended from
time to time. This fee shall be subject to the provisions of all terms set forth
in the Prospectus for volume purchases and special plans and accounts (e.g.
retirement plans, letters of intent, etc.) You will not receive from us a
dealer's concession or similar allowance out of the sales charge. In accordance
with interpretations by the Staff of the Securities and Exchange Commission (the
"Commission"), the agency fee will be your sole charge to your customers for
placing such orders. You may elect to make payments in either of two ways: (a)
you may send us the public offering price for the Fund shares purchased less the
amount of the agency fee due you or (b) you or your customer may send us the
entire public offering price for the Fund shares and we will, on a periodic
basis, remit to you the agency fee due. You will notify us in writing of which
method of payment you elect. If any shares sold to your customer under the terms
of this Agreement are repurchased by the Fund or by us, or are tendered to a
Fund for redemption or repurchase, within seven (7) business days after the date
of the confirmation of the original purchase order, you will promptly refund to
us full agency fee paid or allowed to you on such shares.
<PAGE>
PAYMENT AND ISSUANCE OF CERTIFICATES: Regardless of the payment method elected,
Fund shares purchased by you for your customers hereunder shall be paid for in
fully by check payable to the Fund at its office within five business days after
our acceptance of your order. If not so paid, the Fund reserves the right,
without notice, to cancel the sale and to hold you responsible for any loss,
including lost profit, sustained by us or the Fund in consequence. Certificates
representing Fund shares will not be issued unless a specific request is
received from you or your customer. Certificates, if requested, will be issued
in the names indicated by registration instructions accompanying payment.
REDEMPTION: The Prospectus describes the provisions whereby the Fund, under all
ordinary circumstances, will repurchase its shares from shareholders on demand.
You agree that you will not make any representations to shareholders relating to
the purchase of their Fund 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 to your customers as the redemption price only
the price determined by the Fund.
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 will provide shareholder and administrative services to your
customers, such as: answering inquiries regarding the Fund; assisting in
changing dividend options, account designations and addresses; performing
sub-accounting; establishing and maintaining shareholder accounts and records;
processing purchase and redemption transactions; providing periodic statements
and/or updates showing a customer's account balance and integrating such
statements with those of other transactions and balances in the customer's other
accounts serviced by you; and arranging for bank wires. You will transmit
promptly to customers all communications sent to you for transmittal to clients
by or on behalf of us, any Fund or such Fund's investment advisor, custodian or
transfer or dividend disbursing agent. You will promptly answer all written
complaints received by you relating to Fund accounts or promptly forward such
complaints to us and assist us in answering such complaints. For such services
we will pay you a fee as set 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 Plan adopted by certain of the
Funds, as such 12b-1 Plans may be in effect from time to time, provided,
however, that no payments shall be due and paid to you hereunder with respect to
a Fund unless and until the form of this Agreement shall have been approved by a
majority of the Board of Directors or Trustees of that 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) by vote cast in person at a meeting called for the purpose
of voting on this form of Agreement. Each Fund reserves the right, at any time,
to suspend payments under its 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 fees paid to you pursuant to this Agreement.
In accordance with interpretations and rulings to the Staff of the Commission,
you will not charge your customers any fees for services for which you are being
compensated under a 12b-1 Plan of a Fund.
SALE OF NO-LOAD - NON 12B-1 PLAN FUNDS: In connection with any orders placed by
you on behalf of your customers for shares of Funds that do not charge a sales
load and do not have a 12b-1 Plan, we understand that you may charge your
customers a limited service or transaction fee, in accordance with
interpretations and rulings of the Staff of the Commission.
<PAGE>
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 yo will be (a) a registered broker-dealer under the Securities
Exchange Act of 1934 and qualified under applicable state securities laws, if
any, to act as a broker or dealer in securities, and a member in good standing
of the National Association of Securities Dealers, Inc. (the "NASD"); or (b) a
"bank" as defined in Section 3(a)(6) of the Securities Exchange Act of 1934 (or
other financial institution) and not otherwise required to register as a broker
or dealer under such Act. You agree to notify us promptly in writing if this
representation ceases to be true. You also agree that you will comply with the
rules of the NASD including, in particular, Sections 2 and 26 of Article III
thereof, to the extent applicable, that you will maintain adequate records with
respect to your customers and their transactions, and that such transactions
will be without recourse against you by your customers. We recognize that, in
addition to applicable provisions of state and federal securities laws, you may
be subject to the provisions of the Glass-Steagall Act and other laws governing,
among other things, the conduct of activities by federal and state chartered and
supervised financial institutions and their affiliated organizations. Because
you will be the only one having a direct relationship with the customer, yo will
be responsible in that relationship for insuring compliance with all laws and
regulations, including those of all applicable federal and state regulatory
authorities and bodies having jurisdiction over you or your customers to the
extent applicable to securities purchases hereunder.
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 shall furnish you with information identifying the states 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 in which we indicate Fund shares
may not be sold.
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. We shall file Fund sales literature and
promotional material with the 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.
CUSTOMERS: The names of your customers will remain your sole property and will
not be used by us except for servicing or informational mailings and other
correspondence in the normal course of business.
NOTICES AND COMMUNICATIONS: All communications from you should be addressed to
us at 1818 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 above. 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. Notwithstanding the termination of this
Agreement, you shall remain liable for any amounts otherwise owing to us or the
Fund and for your portion of any transfer tax or other liability which may be
asserted or assessed against the Fund, us or any one or more of our dealers,
based upon the claim that you and such 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 promptly notify us in writing to the contrary, you
will be deemed to have accepted such modifications.
<PAGE>
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. Nothing contained
herein shall constitute you, us and any dealers an association or partnership.
All references in this Agreement to the "Prospectus" include the Statement of
Additional Information incorporated by reference therein and any stickers or
supplements thereto, provided that any requirement in this Agreement to deliver
a copy of the Prospectus shall not include the Statement of Additional
Information unless requested by the customer. This Agreement 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.
Date:________________ DELAWARE DISTRIBUTORS, L.P.
BY: DELAWARE DISTRIBUTORS, INC.,
General Partner
Accepted and Agreed to:
---------------------------
(Name of Firm)
BY:________________________
Name:
Title:
<PAGE>
PROFIT SHARING PLAN
OF
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)
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<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:
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<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.
-6-
<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
-7-
<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.
-8-
<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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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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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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(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.
(c) The following definitions apply for purposes of this Section 4.10.:
(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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(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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(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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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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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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(c) the termination of the Participant's service with the Employer.
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.
(c) The Committee:
(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.
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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:
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(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>
Exhibit 99.B16
DELAWARE POOLED TRUST-THE DEFENSIVE EQUITY PORTFOLIO
ANNUALIZED RATE OF RETURN
FOR THE PERIOD ENDING APRIL 30, 1995
--------------------------------------------------------------------------------
Average Annual Compounded Rate of Return:
n
P(1 + T) = ERV
ONE
YEAR
--------
1
$1000(1 - T) = $1,154.17
T = 15.42%
THREE
YEARS
--------
3
$1000(1 - T) = $1,488.03
T = 14.17%
LIFE OF
FUND
--------
3.24043716
$1000(1 - T) = $1,574.35
T = 15.03%
<PAGE>
DELAWARE POOLED TRUST-THE DEFENSIVE EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
THREE MONTHS
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $12.17
Initial Shares 82.169
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 82.169 $0.040 0.251 82.420
---------------------------------------------------------------------------
Ending Shares 82.420
Ending NAV x $13.35
-----------
Investment Return $1,100.31
Total Return Performance
------------------------
Investment Return $1,100.31
Less Initial Investment $1,000.00
-----------
$100.31 / $1,000.00 x 100
Total Return: 10.03%
<PAGE>
DELAWARE POOLED TRUST-THE DEFENSIVE EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
SIX MONTHS
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $13.08
Initial Shares 76.453
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 76.453 $0.750 4.798 81.251
---------------------------------------------------------------------------
Ending Shares 81.251
Ending NAV x $13.35
-----------
Investment Return $1,084.70
Total Return Performance
------------------------
Investment Return $1,084.70
Less Initial Investment $1,000.00
-----------
$84.70 / $1,000.00 x 100
Total Return: 8.47%
<PAGE>
DELAWARE POOLED TRUST-THE DEFENSIVE EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
NINE MONTHS
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $12.84
Initial Shares 77.882
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 77.882 $0.790 5.143 83.025
---------------------------------------------------------------------------
Ending Shares 83.025
Ending NAV x $13.35
-----------
Investment Return $1,108.38
Total Return Performance
------------------------
Investment Return $1,108.38
Less Initial Investment $1,000.00
-----------
$108.38 / $1,000.00 x 100
Total Return: 10.84%
<PAGE>
DELAWARE POOLED TRUST-THE DEFENSIVE EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
ONE YEAR
------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $12.41
Initial Shares 80.580
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
------------------------------------------------------------------------------
1995 80.580 $0.830 5.875 86.455
------------------------------------------------------------------------------
Ending Shares 86.455
Ending NAV x $13.35
-----------
Investment Return $1,154.17
Total Return Performance
------------------------
Investment Return $1,154.17
Less Initial Investment $1,000.00
-----------
$154.17 / $1,000.00 x 100
Total Return: 15.42%
<PAGE>
DELAWARE POOLED TRUST-THE DEFENSIVE EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
THREE YEARS
------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $10.54
Initial Shares 94.877
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1993 94.877 $0.530 4.290 99.167
--------------------------------------------------------------------------------
1994 99.167 $0.623 5.057 104.224
--------------------------------------------------------------------------------
1995 104.224 $0.830 7.239 111.463
--------------------------------------------------------------------------------
Ending Shares 111.463
Ending NAV x $13.35
-----------
Investment Return $1,488.03
Total Return Performance
-----------------
Investment Return $1,488.03
Less Initial Investment $1,000.00
-----------
$488.03 / $1,000.00 x 100
Total Return: 48.80%
<PAGE>
DELAWARE POOLED TRUST-THE DEFENSIVE EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
LIFE OF THE FUND
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $10.00
Initial Shares 100.000
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1993 100.000 $0.530 4.920 104.920
--------------------------------------------------------------------------------
1994 104.920 $0.623 5.351 110.271
--------------------------------------------------------------------------------
1995 110.271 $0.830 7.658 117.929
--------------------------------------------------------------------------------
Ending Shares 117.929
Ending NAV x $13.35
-----------
Investment Return $1,574.35
------------------------
Investment Return $1,574.35
Less Initial Investment $1,000.00
-----------
$574.35 / $1,000.00 x 100
Total Return: 57.44%
<PAGE>
DELAWARE POOLED TRUST-THE AGGRESSIVE GROWTH PORTFOLIO
ANNUALIZED RATE OF RETURN
FOR THE PERIOD ENDING APRIL 30, 1995
--------------------------------------------------------------------------------
Average Annual Compounded Rate of Return:
n
P(1 + T) = ERV
ONE
YEAR
--------
1
$1000(1 - T) = $1,051.01
T = 5.10%
THREE
YEARS
--------
3
$1000(1 - T) = $1,307.49
T = 9.35%
LIFE OF
FUND
--------
3.17486339
$1000(1 - T) = $1,181.98
T = 5.41%
<PAGE>
DELAWARE POOLED TRUST-THE AGGRESSIVE GROWTH PORTFOLIO
TOTAL RETURN PERFORMANCE
THREE MONTHS
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $10.58
Initial Shares 94.518
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 94.518 $0.000 0.000 94.518
---------------------------------------------------------------------------
Ending Shares 94.518
Ending NAV x $11.29
-----------
Investment Return $1,067.11
Total Return Performance
------------------------
Investment Return $1,067.11
Less Initial Investment $1,000.00
-----------
$67.11 / $1,000.00 x 100
Total Return: 6.71%
<PAGE>
DELAWARE POOLED TRUST-THE AGGRESSIVE GROWTH PORTFOLIO
TOTAL RETURN PERFORMANCE
SIX MONTHS
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $11.01
Initial Shares 90.827
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 90.827 $0.248 2.181 93.008
---------------------------------------------------------------------------
Ending Shares 93.008
Ending NAV x $11.29
-----------
Investment Return $1,050.06
Total Return Performance
------------------------
Investment Return $1,050.06
Less Initial Investment $1,000.00
-----------
$50.06 / $1,000.00 x 100
Total Return: 5.01%
<PAGE>
DELAWARE POOLED TRUST-THE AGGRESSIVE GROWTH PORTFOLIO
TOTAL RETURN PERFORMANCE
NINE MONTHS
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $10.36
Initial Shares 96.525
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 96.525 $0.248 2.317 98.842
---------------------------------------------------------------------------
Ending Shares 98.842
Ending NAV x $11.29
-----------
Investment Return $1,115.93
Total Return Performance
------------------------
Investment Return $1,115.93
Less Initial Investment $1,000.00
-----------
$115.93 / $1,000.00 x 100
Total Return: 11.59%
<PAGE>
DELAWARE POOLED TRUST-THE AGGRESSIVE GROWTH PORTFOLIO
TOTAL RETURN PERFORMANCE
ONE YEAR
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $11.00
Initial Shares 90.909
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 90.909 $0.248 2.183 93.092
---------------------------------------------------------------------------
Ending Shares 93.092
Ending NAV x $11.29
-----------
Investment Return $1,051.01
Total Return Performance
------------------------
Investment Return $1,051.01
Less Initial Investment $1,000.00
-----------
$51.01 / $1,000.00 x 100
Total Return: 5.10%
<PAGE>
DELAWARE POOLED TRUST-THE AGGRESSIVE GROWTH PORTFOLIO
TOTAL RETURN PERFORMANCE
THREE YEARS
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $9.04
Initial Shares 110.619
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1993 110.619 $0.017 0.186 110.805
--------------------------------------------------------------------------------
1994 110.805 $0.230 2.290 113.095
--------------------------------------------------------------------------------
1995 113.095 $0.248 2.715 115.810
--------------------------------------------------------------------------------
Ending Shares 115.810
Ending NAV x $11.29
-----------
Investment Return $1,307.49
Total Return Performance
------------------------
Investment Return $1,307.49
Less Initial Investment $1,000.00
-----------
$307.49 / $1,000.00 x 100
Total Return: 30.75%
<PAGE>
DELAWARE POOLED TRUST-THE AGGRESSIVE GROWTH PORTFOLIO
TOTAL RETURN PERFORMANCE
LIFE OF THE FUND
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $10.00
Initial Shares 100.000
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1993 100.000 $0.017 0.168 100.168
--------------------------------------------------------------------------------
1994 100.168 $0.230 2.070 102.238
--------------------------------------------------------------------------------
1995 102.238 $0.248 2.455 104.693
--------------------------------------------------------------------------------
Ending Shares 104.693
Ending NAV x $11.29
-----------
Investment Return $1,181.98
------------------------
Investment Return $1,181.98
Less Initial Investment $1,000.00
-----------
$181.98 / $1,000.00 x 100
Total Return: 18.20%
<PAGE>
DELAWARE POOLED TRUST-THE INTERNATIONAL EQUITY PORTFOLIO
ANNUALIZED RATE OF RETURN
FOR THE PERIOD ENDING APRIL 30, 1995
--------------------------------------------------------
Average Annual Compounded Rate of Return:
n
P(1 + T) = ERV
ONE
YEAR
--------
1
$1000(1 - T) = $1,025.45
T = 2.55%
THREE
YEARS
--------
3
$1000(1 - T) = $1,365.64
T = 10.95%
LIFE OF
FUND
--------
3.23770492
$1000(1 - T) = $1,388.86
T = 10.68%
<PAGE>
DELAWARE POOLED TRUST-THE INTERNATIONAL EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
THREE MONTHS
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $11.88
Initial Shares 84.175
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 84.175 $0.030 0.203 84.378
---------------------------------------------------------------------------
Ending Shares 84.378
Ending NAV x $12.62
-----------
Investment Return $1,064.85
Total Return Performance
------------------------
Investment Return $1,064.85
Less Initial Investment $1,000.00
-----------
$64.85 / $1,000.00 x 100
Total Return: 6.49%
<PAGE>
DELAWARE POOLED TRUST-THE INTERNATIONAL EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
SIX MONTHS
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $13.11
Initial Shares 76.278
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 76.278 $0.248 2.556 78.834
---------------------------------------------------------------------------
Ending Shares 78.834
Ending NAV x $12.62
-----------
Investment Return $994.89
Total Return Performance
------------------------
Investment Return $994.89
Less Initial Investment $1,000.00
-----------
($5.11)/ $1,000.00 x 100
Total Return: -0.51%
<PAGE>
DELAWARE POOLED TRUST-THE INTERNATIONAL EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
NINE MONTHS
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $12.85
Initial Shares 77.821
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 77.821 $0.248 2.798 80.619
---------------------------------------------------------------------------
Ending Shares 80.619
Ending NAV x $12.62
-----------
Investment Return $1,017.41
Total Return Performance
------------------------
Investment Return $1,017.41
Less Initial Investment $1,000.00
-----------
$17.41 / $1,000.00 x 100
Total Return: 1.74%
<PAGE>
DELAWARE POOLED TRUST-THE INTERNATIONAL EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
ONE YEAR
---------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $12.78
Initial Shares 78.247
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
---------------------------------------------------------------------------
1995 78.247 $0.466 3.009 81.256
---------------------------------------------------------------------------
Ending Shares 81.256
Ending NAV x $12.62
-----------
Investment Return $1,025.45
Total Return Performance
------------------------
Investment Return $1,025.45
Less Initial Investment $1,000.00
-----------
$25.45 / $1,000.00 x 100
Total Return: 2.55%
<PAGE>
DELAWARE POOLED TRUST-THE INTERNATIONAL EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
THREE YEARS
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $10.17
Initial Shares 98.328
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1993 98.328 $0.360 3.650 101.978
--------------------------------------------------------------------------------
1994 101.978 $0.260 2.227 104.205
--------------------------------------------------------------------------------
1995 104.205 $0.466 4.007 108.212
--------------------------------------------------------------------------------
Ending Shares 108.212
Ending NAV x $12.62
-----------
Investment Return $1,365.64
Total Return Performance
------------------------
Investment Return $1,365.64
Less Initial Investment $1,000.00
-----------
$365.64 / $1,000.00 x 100
Total Return: 36.56%
<PAGE>
DELAWARE POOLED TRUST-THE INTERNATIONAL EQUITY PORTFOLIO
TOTAL RETURN PERFORMANCE
LIFE OF THE FUND
------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $10.00
Initial Shares 100.000
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
-------------------------------------------------------------------------------
1993 100.000 $0.360 3.712 103.712
-------------------------------------------------------------------------------
1994 103.712 $0.260 2.265 105.977
-------------------------------------------------------------------------------
1995 105.977 $0.466 4.075 110.052
-------------------------------------------------------------------------------
Ending Shares 110.052
Ending NAV x $12.62
-----------
Investment Return $1,388.86
-----------------
Investment Return $1,388.86
Less Initial Investment $1,000.00
-----------
$388.86 / $1,000.00 x 100
Total Return: 38.89%
<PAGE>
DELAWARE POOLED TRUST-THE GLOBAL FIXED INCOME PORTFOLIO
ANNUALIZED RATE OF RETURN
FOR THE PERIOD ENDING APRIL 30, 1995
-------------------------------------------------------------------------------
Average Annual Compounded Rate of Return:
n
P(1 + T) = ERV
ONE
YEAR
--------
1
$1000(1 - T) = $1,051.82
T = 5.18%
LIFE OF
FUND
--------
2.41619881
$1000(1 - T) = $1,260.74
T = 10.06%
<PAGE>
DELAWARE POOLED TRUST-THE GLOBAL FIXED INCOME PORTFOLIO
TOTAL RETURN PERFORMANCE
THREE MONTHS
------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $9.82
Initial Shares 101.833
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
------------------------------------------------------------------------------
1995 101.833 $0.090 0.924 102.757
------------------------------------------------------------------------------
Ending Shares 102.757
Ending NAV x $10.07
-----------
Investment Return $1,034.76
Total Return Performance
-----------------
Investment Return $1,034.76
Less Initial Investment $1,000.00
-----------
$34.76 / $1,000.00 x 100
Total Return: 3.48%
<PAGE>
DELAWARE POOLED TRUST-THE GLOBAL FIXED INCOME PORTFOLIO
TOTAL RETURN PERFORMANCE
SIX MONTHS
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $9.79
Initial Shares 102.145
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1995 102.145 $0.230 2.398 104.543
--------------------------------------------------------------------------------
Ending Shares 104.543
Ending NAV x $10.07
-----------
Investment Return $1,052.75
Total Return Performance
------------------------
Investment Return $1,052.75
Less Initial Investment $1,000.00
-----------
$52.75 / $1,000.00 x 100
Total Return: 5.28%
<PAGE>
DELAWARE POOLED TRUST-THE GLOBAL FIXED INCOME PORTFOLIO
TOTAL RETURN PERFORMANCE
NINE MONTHS
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $9.62
Initial Shares 103.950
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1995 103.950 $0.248 3.426 107.376
--------------------------------------------------------------------------------
Ending Shares 107.376
Ending NAV x $10.07
-----------
Investment Return $1,081.28
Total Return Performance
------------------------
Investment Return $1,081.28
Less Initial Investment $1,000.00
-----------
$81.28 / $1,000.00 x 100
Total Return: 8.13%
<PAGE>
DELAWARE POOLED TRUST-THE GLOBAL FIXED INCOME PORTFOLIO
TOTAL RETURN PERFORMANCE
ONE YEAR
--------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $10.06
Initial Shares 99.404
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1995 99.404 $0.487 5.047 104.451
--------------------------------------------------------------------------------
Ending Shares 104.451
Ending NAV x $10.07
-----------
Investment Return $1,051.82
Total Return Performance
------------------------
Investment Return $1,051.82
Less Initial Investment $1,000.00
-----------
$51.82 / $1,000.00 x 100
Total Return: 5.18%
<PAGE>
DELAWARE POOLED TRUST-THE GLOBAL FIXED INCOME PORTFOLIO
TOTAL RETURN PERFORMANCE
LIFE OF THE FUND
------------------------------------------------------------------------------
Initial Investment $1,000.00
Beginning OFFER $10.00
Initial Shares 100.000
Fiscal Beginning Dividends Reinvested Cumulative
Year Shares for Period Shares Shares
--------------------------------------------------------------------------------
1993 100.000 $0.240 2.275 102.275
--------------------------------------------------------------------------------
1994 102.275 $1.637 16.875 119.150
--------------------------------------------------------------------------------
1995 119.150 $0.487 6.048 125.198
--------------------------------------------------------------------------------
Ending Shares 125.198
Ending NAV x $10.07
-----------
Investment Return $1,260.74
-----------------
Investment Return $1,260.74
Less Initial Investment $1,000.00
-----------
$260.74 / $1,000.00 x 100
Total Return: 26.07%
<PAGE>
Delaware Pooled Trust Global Fixed Income
Yield Quotation for the Month Ended April 30, 1995
<TABLE>
<S> <C> <C>
Interest Earned $687,466.98
Expenses Accrued $42,612.03
Net Income $644,854.95
Average Shares Outstanding 7,962,648.070
Maximum Offering Price
April 30, 1995 $10.56
Yield 9.38%
Global Fixed Income Yield 2 [(687,467 - 42,612+1) 6 - 1] = 9.38%
[(---------------- ) ]
[(7962648.07 x 10.56) ]
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000875352
<NAME> DELAWARE POOLED TRUST, INC.
<SERIES>
<NUMBER> 1
<NAME> INTERNATIONAL EQUITY
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> OCT-31-1994 OCT-31-1994
<PERIOD-END> OCT-31-1994 APR-30-1995
<INVESTMENTS-AT-COST> 64,239,592 88,617,354
<INVESTMENTS-AT-VALUE> 70,349,616 95,551,528
<RECEIVABLES> 525,460 1,050,501
<ASSETS-OTHER> 0 0
<OTHER-ITEMS-ASSETS> 5,226 333,872
<TOTAL-ASSETS> 70,880,667 96,935,901
<PAYABLE-FOR-SECURITIES> 0 0
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 105,756 850,131
<TOTAL-LIABILITIES> 105,756 850,131
<SENIOR-EQUITY> 54,025 76,115
<PAID-IN-CAPITAL-COMMON> 63,147,821 89,833,709
<SHARES-COMMON-STOCK> 5,402,475 7,611,462
<SHARES-COMMON-PRIOR> 2,025,988 5,402,475
<ACCUMULATED-NII-CURRENT> 823,809 1,296,231
<OVERDISTRIBUTION-NII> 0 0
<ACCUMULATED-NET-GAINS> 936,242 (1,387,948)
<OVERDISTRIBUTION-GAINS> 0 0
<ACCUM-APPREC-OR-DEPREC> 5,858,107 6,267,663
<NET-ASSETS> 70,820,004 96,085,770
<DIVIDEND-INCOME> 1,583,829 1,153,237
<INTEREST-INCOME> 306,776 318,468
<OTHER-INCOME> 0 0
<EXPENSES-NET> 493,550 356,874
<NET-INVESTMENT-INCOME> 1,397,055 1,114,831
<REALIZED-GAINS-CURRENT> 894,100 (752,608)
<APPREC-INCREASE-CURRENT> 3,228,171 409,556
<NET-CHANGE-FROM-OPS> 5,519,326 771,779
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 632,551 642,409
<DISTRIBUTIONS-OF-GAINS> 279,065 1,571,582
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 3,445,243 2,193,679
<NUMBER-OF-SHARES-REDEEMED> 142,554 166,872
<SHARES-REINVESTED> 73,798 182,180
<NET-CHANGE-IN-ASSETS> 46,532,150 25,265,766
<ACCUMULATED-NII-PRIOR> 59,305 823,809
<ACCUMULATED-GAINS-PRIOR> 321,207 936,242
<OVERDISTRIB-NII-PRIOR> 0 0
<OVERDIST-NET-GAINS-PRIOR> 0 0
<GROSS-ADVISORY-FEES> 390,070 289,154
<INTEREST-EXPENSE> 0 0
<GROSS-EXPENSE> 508,798 356,874
<AVERAGE-NET-ASSETS> 52,494,638 77,574,951
<PER-SHARE-NAV-BEGIN> 11.990 13.110
<PER-SHARE-NII> 0.144 (0.015)
<PER-SHARE-GAIN-APPREC> 1.236 (0.069)
<PER-SHARE-DIVIDEND> 0.160 0.110
<PER-SHARE-DISTRIBUTIONS> 0.100 0.296
<RETURNS-OF-CAPITAL> 0 0
<PER-SHARE-NAV-END> 13.110 12.620
<EXPENSE-RATIO> 0.94 0.93
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000875352
<NAME> DELAWARE POOLED TRUST, INC.
<SERIES>
<NUMBER> 2
<NAME> DEFENSIVE EQUITY
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> OCT-31-1994 OCT-31-1994
<PERIOD-END> OCT-31-1994 APR-30-1995
<INVESTMENTS-AT-COST> 36,664,933 51,023,177
<INVESTMENTS-AT-VALUE> 37,277,205 53,885,788
<RECEIVABLES> 176,099 1,428,251
<ASSETS-OTHER> 0 0
<OTHER-ITEMS-ASSETS> 89,690 15,868
<TOTAL-ASSETS> 37,539,994 55,239,907
<PAYABLE-FOR-SECURITIES> 169,147 1,132,396
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 47,689 74,412
<TOTAL-LIABILITIES> 216,836 1,206,808
<SENIOR-EQUITY> 28,530 40,542
<PAID-IN-CAPITAL-COMMON> 34,709,851 49,963,223
<SHARES-COMMON-STOCK> 2,853,015 4,054,160
<SHARES-COMMON-PRIOR> 1,054,265 2,853,015
<ACCUMULATED-NII-CURRENT> 438,019 323,718
<OVERDISTRIBUTION-NII> 0 0
<ACCUMULATED-NET-GAINS> 1,534,486 933,005
<OVERDISTRIBUTION-GAINS> 0 0
<ACCUM-APPREC-OR-DEPREC> 612,272 2,862,611
<NET-ASSETS> 37,323,158 54,123,099
<DIVIDEND-INCOME> 808,772 780,247
<INTEREST-INCOME> 83,498 102,174
<OTHER-INCOME> 0 0
<EXPENSES-NET> 153,594 142,701
<NET-INVESTMENT-INCOME> 738,676 739,720
<REALIZED-GAINS-CURRENT> 1,535,246 945,227
<APPREC-INCREASE-CURRENT> (461,803) 2,250,339
<NET-CHANGE-FROM-OPS> 1,812,119 3,935,286
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 419,984 854,021
<DISTRIBUTIONS-OF-GAINS> 422,183 1,546,708
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 1,965,280 1,151,084
<NUMBER-OF-SHARES-REDEEMED> 234,132 146,615
<SHARES-REINVESTED> 67,602 196,676
<NET-CHANGE-IN-ASSETS> 23,904,712 16,799,941
<ACCUMULATED-NII-PRIOR> 119,327 438,019
<ACCUMULATED-GAINS-PRIOR> 421,423 1,534,486
<OVERDISTRIB-NII-PRIOR> 0 0
<OVERDIST-NET-GAINS-PRIOR> 0 0
<GROSS-ADVISORY-FEES> 121,537 115,277
<INTEREST-EXPENSE> 0 0
<GROSS-EXPENSE> 186,786 152,853
<AVERAGE-NET-ASSETS> 22,678,850 42,632,622
<PER-SHARE-NAV-BEGIN> 12.730 13.080
<PER-SHARE-NII> 0.320 0.186
<PER-SHARE-GAIN-APPREC> 0.653 0.834
<PER-SHARE-DIVIDEND> 0.280 0.260
<PER-SHARE-DISTRIBUTIONS> 0.343 0.490
<RETURNS-OF-CAPITAL> 0 0
<PER-SHARE-NAV-END> 13.080 13.350
<EXPENSE-RATIO> 0.68 0.68
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000875352
<NAME> DELAWARE POOLED TRUST, INC.
<SERIES>
<NUMBER> 3
<NAME> AGGRESSIVE GROWTH
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> OCT-31-1994 OCT-31-1994
<PERIOD-END> OCT-31-1994 APR-30-1995
<INVESTMENTS-AT-COST> 21,005,439 23,999,191
<INVESTMENTS-AT-VALUE> 23,156,320 27,035,516
<RECEIVABLES> 228,133 161,231
<ASSETS-OTHER> 0 0
<OTHER-ITEMS-ASSETS> 5,005 3,704
<TOTAL-ASSETS> 23,389,458 27,200,451
<PAYABLE-FOR-SECURITIES> 692,923 864,680
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 56,812 90,431
<TOTAL-LIABILITIES> 749,735 955,111
<SENIOR-EQUITY> 20,557 23,242
<PAID-IN-CAPITAL-COMMON> 19,992,284 22,961,336
<SHARES-COMMON-STOCK> 2,055,747 2,324,197
<SHARES-COMMON-PRIOR> 1,827,833 2,055,747
<ACCUMULATED-NII-CURRENT> 10,795 44,311
<OVERDISTRIBUTION-NII> 0 0
<ACCUMULATED-NET-GAINS> 465,206 180,126
<OVERDISTRIBUTION-GAINS> 0 0
<ACCUM-APPREC-OR-DEPREC> 21,150,881 3,036,325
<NET-ASSETS> 22,639,723 26,245,340
<DIVIDEND-INCOME> 58,671 28,860
<INTEREST-INCOME> 160,144 135,779
<OTHER-INCOME> 0 0
<EXPENSES-NET> 202,702 106,263
<NET-INVESTMENT-INCOME> 16,113 58,376
<REALIZED-GAINS-CURRENT> 505,673 203,838
<APPREC-INCREASE-CURRENT> (387,251) 885,444
<NET-CHANGE-FROM-OPS> 134,535 1,147,658
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 37,888 24,860
<DISTRIBUTIONS-OF-GAINS> 397,820 488,918
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 247,591 218,714
<NUMBER-OF-SHARES-REDEEMED> 58,824 0
<SHARES-REINVESTED> 39,147 49,736
<NET-CHANGE-IN-ASSETS> 2,162,074 3,605,617
<ACCUMULATED-NII-PRIOR> 32,570 10,795
<ACCUMULATED-GAINS-PRIOR> 357,353 465,206
<OVERDISTRIB-NII-PRIOR> 0 0
<OVERDIST-NET-GAINS-PRIOR> 0 0
<GROSS-ADVISORY-FEES> 171,517 90,760
<INTEREST-EXPENSE> 0 0
<GROSS-EXPENSE> 255,242 132,674
<AVERAGE-NET-ASSETS> 21,789,532 23,180,074
<PER-SHARE-NAV-BEGIN> 11.200 11.010
<PER-SHARE-NII> 0.008 0.026
<PER-SHARE-GAIN-APPREC> 0.032 0.502
<PER-SHARE-DIVIDEND> 0.020 0.012
<PER-SHARE-DISTRIBUTIONS> 0.210 0.236
<RETURNS-OF-CAPITAL> 0 0
<PER-SHARE-NAV-END> 11.010 11.290
<EXPENSE-RATIO> 0.93 0.93
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000875352
<NAME> DELAWARE POOLED TRUST, INC.
<SERIES>
<NUMBER> 4
<NAME> FIXED INCOME
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> OCT-31-1994 OCT-31-1994
<PERIOD-END> OCT-31-1994 APR-30-1995
<INVESTMENTS-AT-COST> 0 0
<INVESTMENTS-AT-VALUE> 0 0
<RECEIVABLES> 0 0
<ASSETS-OTHER> 0 0
<OTHER-ITEMS-ASSETS> 54,176 57,968
<TOTAL-ASSETS> 54,176 57,968
<PAYABLE-FOR-SECURITIES> 0 0
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 33,176 36,968
<TOTAL-LIABILITIES> 33,176 36,968
<SENIOR-EQUITY> 21 21
<PAID-IN-CAPITAL-COMMON> 20,979 20,979
<SHARES-COMMON-STOCK> 2,100 2,100
<SHARES-COMMON-PRIOR> 2,100 2,100
<ACCUMULATED-NII-CURRENT> 0 0
<OVERDISTRIBUTION-NII> 0 0
<ACCUMULATED-NET-GAINS> 0 0
<OVERDISTRIBUTION-GAINS> 0 0
<ACCUM-APPREC-OR-DEPREC> 0 0
<NET-ASSETS> 21,000 21,000
<DIVIDEND-INCOME> 0 0
<INTEREST-INCOME> 0 0
<OTHER-INCOME> 0 0
<EXPENSES-NET> 0 0
<NET-INVESTMENT-INCOME> 0 0
<REALIZED-GAINS-CURRENT> 0 0
<APPREC-INCREASE-CURRENT> 0 0
<NET-CHANGE-FROM-OPS> 0 0
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 0 0
<DISTRIBUTIONS-OF-GAINS> 0 0
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 0 0
<NUMBER-OF-SHARES-REDEEMED> 0 0
<SHARES-REINVESTED> 0 0
<NET-CHANGE-IN-ASSETS> 0 0
<ACCUMULATED-NII-PRIOR> 0 0
<ACCUMULATED-GAINS-PRIOR> 0 0
<OVERDISTRIB-NII-PRIOR> 0 0
<OVERDIST-NET-GAINS-PRIOR> 0 0
<GROSS-ADVISORY-FEES> 0 0
<INTEREST-EXPENSE> 0 0
<GROSS-EXPENSE> 0 0
<AVERAGE-NET-ASSETS> 21,000 21,000
<PER-SHARE-NAV-BEGIN> 10.000 10.000
<PER-SHARE-NII> 0 0
<PER-SHARE-GAIN-APPREC> 0 0
<PER-SHARE-DIVIDEND> 0 0
<PER-SHARE-DISTRIBUTIONS> 0 0
<RETURNS-OF-CAPITAL> 0 0
<PER-SHARE-NAV-END> 10.000 10.000
<EXPENSE-RATIO> 0 0
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000875352
<NAME> DELAWARE POOLED TRUST, INC.
<SERIES>
<NUMBER> 5
<NAME> LIMITED-TERM MATURITY
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> OCT-31-1994 OCT-31-1994
<PERIOD-END> OCT-31-1994 APR-30-1995
<INVESTMENTS-AT-COST> 0 0
<INVESTMENTS-AT-VALUE> 0 0
<RECEIVABLES> 0 0
<ASSETS-OTHER> 0 0
<OTHER-ITEMS-ASSETS> 52,995 56,526
<TOTAL-ASSETS> 52,995 56,526
<PAYABLE-FOR-SECURITIES> 0 0
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 31,995 35,526
<TOTAL-LIABILITIES> 31,995 35,526
<SENIOR-EQUITY> 21 21
<PAID-IN-CAPITAL-COMMON> 20,979 20,979
<SHARES-COMMON-STOCK> 2,100 2,100
<SHARES-COMMON-PRIOR> 2,100 2,100
<ACCUMULATED-NII-CURRENT> 0 0
<OVERDISTRIBUTION-NII> 0 0
<ACCUMULATED-NET-GAINS> 0 0
<OVERDISTRIBUTION-GAINS> 0 0
<ACCUM-APPREC-OR-DEPREC> 0 0
<NET-ASSETS> 21,000 21,000
<DIVIDEND-INCOME> 0 0
<INTEREST-INCOME> 0 0
<OTHER-INCOME> 0 0
<EXPENSES-NET> 0 0
<NET-INVESTMENT-INCOME> 0 0
<REALIZED-GAINS-CURRENT> 0 0
<APPREC-INCREASE-CURRENT> 0 0
<NET-CHANGE-FROM-OPS> 0 0
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 0 0
<DISTRIBUTIONS-OF-GAINS> 0 0
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 0 0
<NUMBER-OF-SHARES-REDEEMED> 0 0
<SHARES-REINVESTED> 0 0
<NET-CHANGE-IN-ASSETS> 0 0
<ACCUMULATED-NII-PRIOR> 0 0
<ACCUMULATED-GAINS-PRIOR> 0 0
<OVERDISTRIB-NII-PRIOR> 0 0
<OVERDIST-NET-GAINS-PRIOR> 0 0
<GROSS-ADVISORY-FEES> 0 0
<INTEREST-EXPENSE> 0 0
<GROSS-EXPENSE> 0 0
<AVERAGE-NET-ASSETS> 21,000 21,000
<PER-SHARE-NAV-BEGIN> 10.000 10.000
<PER-SHARE-NII> 0 0
<PER-SHARE-GAIN-APPREC> 0 0
<PER-SHARE-DIVIDEND> 0 0
<PER-SHARE-DISTRIBUTIONS> 0 0
<RETURNS-OF-CAPITAL> 0 0
<PER-SHARE-NAV-END> 10.000 10.000
<EXPENSE-RATIO> 0 0
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000875352
<NAME> DELAWARE POOLED TRUST, INC.
<SERIES>
<NUMBER> 6
<NAME> GLOBAL FIXED INCOME
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> OCT-31-1994 OCT-31-1994
<PERIOD-END> OCT-31-1994 APR-30-1995
<INVESTMENTS-AT-COST> 40,483,335 72,412,378
<INVESTMENTS-AT-VALUE> 40,152,855 73,345,068
<RECEIVABLES> 1,851,745 3,285,400
<ASSETS-OTHER> 0 0
<OTHER-ITEMS-ASSETS> 310,249 1,389,294
<TOTAL-ASSETS> 42,314,849 78,019,762
<PAYABLE-FOR-SECURITIES> 0 1,385,354
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 49,259 366,491
<TOTAL-LIABILITIES> 49,259 1,751,845
<SENIOR-EQUITY> 43,152 75,773
<PAID-IN-CAPITAL-COMMON> 43,558,941 75,744,440
<SHARES-COMMON-STOCK> 4,315,243 7,577,284
<SHARES-COMMON-PRIOR> 2,642,690 4,315,243
<ACCUMULATED-NII-CURRENT> 304,139 1,651,032
<OVERDISTRIBUTION-NII> 0 0
<ACCUMULATED-NET-GAINS> (1,523,470) (2,108,659)
<OVERDISTRIBUTION-GAINS> 0 0
<ACCUM-APPREC-OR-DEPREC> (117,172) 905,331
<NET-ASSETS> 42,265,590 76,267,917
<DIVIDEND-INCOME> 0 0
<INTEREST-INCOME> 3,286,861 2,742,322
<OTHER-INCOME> 0 0
<EXPENSES-NET> 220,878 164,110
<NET-INVESTMENT-INCOME> 3,065,983 2,578,212
<REALIZED-GAINS-CURRENT> (2,201,136) (585,189)
<APPREC-INCREASE-CURRENT> (134,425) 1,022,503
<NET-CHANGE-FROM-OPS> 730,422 437,314
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 3,001,453 1,231,319
<DISTRIBUTIONS-OF-GAINS> 1,523,836 0
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 1,356,353 3,250,318
<NUMBER-OF-SHARES-REDEEMED> 127,578 85,427
<SHARES-REINVESTED> 443,778 97,150
<NET-CHANGE-IN-ASSETS> 12,952,589 34,002,327
<ACCUMULATED-NII-PRIOR> 239,609 304,139
<ACCUMULATED-GAINS-PRIOR> 2,201,502 (1,523,470)
<OVERDISTRIB-NII-PRIOR> 0 0
<OVERDIST-NET-GAINS-PRIOR> 0 0
<GROSS-ADVISORY-FEES> 175,663 136,917
<INTEREST-EXPENSE> 0 0
<GROSS-EXPENSE> 271,636 179,362
<AVERAGE-NET-ASSETS> 35,724,381 55,497,377
<PER-SHARE-NAV-BEGIN> 11.090 9.790
<PER-SHARE-NII> 0.419 0.411
<PER-SHARE-GAIN-APPREC> (0.193) 0.099
<PER-SHARE-DIVIDEND> 0.949 0.230
<PER-SHARE-DISTRIBUTIONS> 0.577 0
<RETURNS-OF-CAPITAL> 0 0
<PER-SHARE-NAV-END> 9.790 10.070
<EXPENSE-RATIO> 0.62 0.60
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0
</TABLE>
<TABLE> <S> <C>
<PAGE>
<ARTICLE> 6
<CIK> 0000875352
<NAME> DELAWARE POOLED TRUST, INC.
<SERIES>
<NUMBER> 7
<NAME> INTERNATIONAL FIXED INCOME
<S> <C> <C>
<PERIOD-TYPE> 12-MOS 6-MOS
<FISCAL-YEAR-END> OCT-31-1994 OCT-31-1994
<PERIOD-END> OCT-31-1994 APR-30-1995
<INVESTMENTS-AT-COST> 0 0
<INVESTMENTS-AT-VALUE> 0 0
<RECEIVABLES> 0 0
<ASSETS-OTHER> 0 0
<OTHER-ITEMS-ASSETS> 11,957 18,488
<TOTAL-ASSETS> 11,957 18,488
<PAYABLE-FOR-SECURITIES> 0 0
<SENIOR-LONG-TERM-DEBT> 0 0
<OTHER-ITEMS-LIABILITIES> 0 0
<TOTAL-LIABILITIES> 0 0
<SENIOR-EQUITY> 0 0
<PAID-IN-CAPITAL-COMMON> 0 0
<SHARES-COMMON-STOCK> 0 0
<SHARES-COMMON-PRIOR> 0 0
<ACCUMULATED-NII-CURRENT> 0 0
<OVERDISTRIBUTION-NII> 0 0
<ACCUMULATED-NET-GAINS> 0 0
<OVERDISTRIBUTION-GAINS> 0 0
<ACCUM-APPREC-OR-DEPREC> 0 0
<NET-ASSETS> 0 0
<DIVIDEND-INCOME> 0 0
<INTEREST-INCOME> 0 0
<OTHER-INCOME> 0 0
<EXPENSES-NET> 0 0
<NET-INVESTMENT-INCOME> 0 0
<REALIZED-GAINS-CURRENT> 0 0
<APPREC-INCREASE-CURRENT> 0 0
<NET-CHANGE-FROM-OPS> 0 0
<EQUALIZATION> 0 0
<DISTRIBUTIONS-OF-INCOME> 0 0
<DISTRIBUTIONS-OF-GAINS> 0 0
<DISTRIBUTIONS-OTHER> 0 0
<NUMBER-OF-SHARES-SOLD> 0 0
<NUMBER-OF-SHARES-REDEEMED> 0 0
<SHARES-REINVESTED> 0 0
<NET-CHANGE-IN-ASSETS> 0 0
<ACCUMULATED-NII-PRIOR> 0 0
<ACCUMULATED-GAINS-PRIOR> 0 0
<OVERDISTRIB-NII-PRIOR> 0 0
<OVERDIST-NET-GAINS-PRIOR> 0 0
<GROSS-ADVISORY-FEES> 0 0
<INTEREST-EXPENSE> 0 0
<GROSS-EXPENSE> 0 0
<AVERAGE-NET-ASSETS> 0 0
<PER-SHARE-NAV-BEGIN> 0 0
<PER-SHARE-NII> 0 0
<PER-SHARE-GAIN-APPREC> 0 0
<PER-SHARE-DIVIDEND> 0 0
<PER-SHARE-DISTRIBUTIONS> 0 0
<RETURNS-OF-CAPITAL> 0 0
<PER-SHARE-NAV-END> 0 0
<EXPENSE-RATIO> 0 0
<AVG-DEBT-OUTSTANDING> 0 0
<AVG-DEBT-PER-SHARE> 0 0
</TABLE>
<PAGE>
Exhibit 99.B19
POWER OF ATTORNEY
Each of the undersigned, a member of the Board of Directors of DELAWARE
POOLED TRUST, 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>
Exhibit 99.B20
[LOGO OF DELAWARE POOLED
TRUST APPEARS HERE]
<PAGE>
[LOGO OF DELAWARE POOLED THE INTERNATIONAL EQUITY PORTFOLIO
TRUST APPEARS HERE]
AUDITED
ANNUAL
REPORT
October 31, 1994
<PAGE>
DELAWARE POOLED TRUST, INC.--THE INTERNATIONAL EQUITY PORTFOLIO
For the fiscal year ended October 31, 1994, The International Equity
Portfolio provided a return of 11.66%*, which exceeded the 10.38% return of the
unmanaged Morgan Stanley Europe, Australia and Far East (EAFE) Index, your
Portfolio's benchmark, and far outpaced the 3.86% return of the S&P 500 Index of
American stocks, which provides a measurement of the U.S. equity market for
comparison.
Even so, the types of stocks The International Equity Portfolio
typically invests in were out of favor with the market for most of the fiscal
year. High-yielding value stocks lost ground due to interest rate increases
and to investors' migration to cyclical stocks. In this climate, both our
individual stock selection and country allocation were important to the
Portfolio's performance.
In general, over the course of the year, we had heavy weightings in the
Anglo-Saxon countries, but were underweighted in Japan, relative to the EAFE's
positioning in both areas. Anglo-Saxon economies--Australia, New Zealand, the
United Kingdom and Germany--are generally reporting growth in low inflationary
environments. In Japan, on the other hand, we believe that continuing structural
problems will mean a slower and more limited economic recovery than we've seen
there in the past. Also during the past year, we initiated positions in Hong
Kong and Malaysia. Here we felt that the countries again offered good relative
value after recent corrections served to depress high prices in both markets.
Our stock selection over the course of the year has generally been
strong. Acerinox in Spain, GKN in the U.K., and Wilson & Horton in New Zealand
all contributed to the Portfolio's return. One disappointment over the period
was an investment in a French company that suffered as a result of a lower
sales outlook.
Going forward, we are decreasing our holdings in Canada and beginning to
invest in Indonesia, which we feel offers better relative value. We still feel
strongly about the Anglo-Saxon economies and will maintain our heavy weightings
in those countries. As always, we will manage The International Equity
Portfolio seeking a return exceeding that of the U.S. inflation rate with low
volatility. As in the past, we will focus first on individual stocks and then
make purchase or sell decisions that take into account the economic, political
and market environment of their respective countries.
<PAGE>
<TABLE>
<CAPTION>
International Equity Portfolio EAFE Index Standard & Poor's 500 Index
------------------------------ ---------- ---------------------------
<S> <C> <C> <C>
2/29/92 $ 9,890 $ 9,645 $ 9,972
3/31/92 9,620 9,011 9,825
4/30/92 10,170 9,056 10,099
5/31/92 10,540 9,665 10,540
6/30/92 10,191 9,210 10,012
7/31/92 9,858 8,977 10,406
8/31/92 9,788 9,543 10,157
9/30/92 9,358 9,859 10,328
10/31/92 9,597 8,870 10,349
11/30/92 9,607 8,956 10,663
12/31/92 9,961 9,005 10,845
1/31/93 9,962 9,006 10,922
2/28/93 10,250 9,281 11,036
3/31/93 11,016 10,093 11,317
4/30/93 11,410 11,053 11,030
5/31/93 11,400 11,290 11,280
6/30/93 11,286 11,116 11,371
7/31/93 11,619 11,508 11,311
8/31/93 12,150 12,131 11,700
9/30/93 12,077 11,861 11,664
10/31/93 12,505 12,229 11,890
11/30/93 12,077 11,163 11,737
12/31/93 12,922 11,971 11,934
1/31/94 13,737 12,986 12,321
2/28/94 13,462 12,953 11,951
3/31/94 13,039 12,398 11,485
4/30/94 13,548 12,926 11,617
5/31/94 13,378 12,855 11,761
6/30/94 13,208 13,040 11,534
7/31/94 13,655 13,168 11,897
8/31/94 14,197 13,482 12,345
9/30/94 13,548 13,061 12,098
10/31/94 13,964 13,499 12,350
</TABLE>
The International
Equity Portfolio
Average Annual
Total Return*
through October 31, 1994
Lifetime.........12.95%
One Year..........11.66%
A $10,000 investment in The International Equity Portfolio made at its inception
on February 4, 1992 would have grown to $13,964 by October 31, 1994,
outperforming both the EAFE Index and the American S&P 500 Stock Index, two
unmanaged indexes.
All dividends and capital gains have been reinvested for The International
Equity Portfolio and the Index. Past performance is not a guarantee of future
results. Return and share value will fluctuate so that shares, when redeemed,
may be worth more or less than the original investment. No adjustments have been
made for taxes.
* During this period, Delaware Management Company voluntarily agreed to waive
its fee and reimburse the Portfolio to the extent that annual operating
expenses, exclusive of taxes, interest, brokerage commissions and
extraordinary expenses, exceed .96% of average net assets. In the absence of
the waiver, the Portfolio's total return would have been lower.
<PAGE>
Delaware Pooled Trust, Inc.-The International Equity Portfolio
Statement of Net Assets
October 31, 1994
<TABLE>
<CAPTION>
Market
Number Value
of Shares (U.S. $)
<S> <C> <C>
COMMON STOCK-92.11%
Australia-9.90%
National Australian Bank Ltd. 210,941 $1,665,736
National Foods Limited 287,794 384,466
Pacific Dunlop 834,516 2,533,153
Santos 825,454 2,426,004
-----------
7,009,359
-----------
Belgium-4.79%
Cimenterics CBR Cementbedrij 1,650 632,895
* Cimenterics CBR Cementbedrij Put Warrants 1,650 11,488
Electrabel NPV 11,280 1,999,736
G.I.B. Holdings 19,372 751,799
-----------
3,395,918
-----------
Canada-5.42%
British Columbia Telephone 86,000 1,589,649
Imperial Oil 62,750 2,250,185
-----------
3,839,834
-----------
France-5.62%
Alcatel Alsthom 11,132 1,017,665
Compagnie de Saint Gobain 7,379 933,255
Elf Aquitaine 27,489 2,025,830
-----------
3,976,750
-----------
Germany-5.55%
Bayer AG 4,800 1,126,134
Continental AG 7,355 1,075,735
Siemens AG 4,130 1,725,856
-----------
3,927,725
-----------
Hong Kong-2.99%
Hong Kong Electric 240,000 754,756
Jardine Matheson HK Registry 163,800 1,361,997
-----------
2,116,753
-----------
Italy-0.03%
Istituto Mobiliare Italiano 3,031 19,718
-----------
19,718
-----------
Japan-13.53%
Amano 72,000 1,210,557
Chiyoda Fire and Marine Insurance 86,000 568,619
Eisai 135,000 2,311,570
Hitachi 233,000 2,427,406
Kinki Coca-Cola Bottling 32,000 485,213
Matsushita Electric 119,000 1,976,232
Sanoh Industrial 45,000 603,422
-----------
9,583,019
-----------
Malaysia-1.56%
Sime Darby Berhad 400,000 1,103,027
-----------
1,103,027
-----------
Netherlands-7.53%
Elsevier 130,000 1,322,764
Nutricia 41,000 2,207,170
Royal Dutch Petroleum 15,525 1,801,943
-----------
5,331,877
-----------
New Zealand-4.50%
Telecom Corp. of New Zealand 722,876 2,519,383
Wilson and Horton Ltd. 136,000 669,951
-----------
3,189,334
-----------
Spain-3.31%
Acerinox SAR 3,986 440,413
Banco Central Hispanoamer SA 19,827 474,174
Telefonica De Espana 105,850 1,430,278
-----------
2,344,865
-----------
</TABLE>
<PAGE>
Statement of Net Assets (Continued)
<TABLE>
<CAPTION>
Market
Number Value
of Shares (U.S. $)
<S> <C> <C>
COMMON STOCK-(Continued)
United Kingdom-27.38%
Bass plc 213,000 $ 1,934,469
Blue Circle Industries 129,000 597,359
British Gas plc 469,300 2,234,398
* Costain Group plc 1,227,096 450,182
Dalgety plc 293,100 2,059,777
Dawson International 279,250 614,687
Great Universal Stores 248,300 2,271,259
GKN plc 235,750 2,333,283
Powergen plc 269,500 2,491,546
RTZ 121,000 1,694,750
Sears plc 1,089,650 1,901,069
Taylor Woodrow plc 388,700 811,244
-----------
19,394,023
-----------
Total Common Stock (cost $58,849,492) 65,232,202
-----------
<CAPTION>
Principal
Amount**
<S> <C> <C>
GOVERNMENT OBLIGATIONS-4.48%
Government of Canada 10.25% 3/15/14 C$ 3,953,000 3,169,414
-----------
Total Government Obligations (Cost $3,442,100) 3,169,414
-----------
REPURCHASE AGREEMENTS-2.75%
With Prudential Securities 4.76% 11/1/94
(dated 10/31/94, collateralized by
$2,019,000 U.S. Treasury Notes 4.625% due
2/29/96, market value $1,987,673) $1,948,000 1,948,000
-----------
Total Repurchase Agreements (Cost $1,948,000) 1,948,000
-----------
TOTAL MARKET VALUE OF SECURITIES-99.34%
(Cost $64,239,592) 70,349,616
RECEIVABLES AND OTHER ASSETS
NET OF LIABILITIES-0.66% 470,388
-----------
NET ASSETS APPLICABLE TO 5,402,475 SHARES
($.01 PAR VALUE) OUTSTANDING; EQUIVALENT TO
$13.11 PER SHARE - 100.00% $70,820,004
===========
</TABLE>
-------------------------------
* Non-income producing security for the year ended October 31, 1994.
** Principal amount is stated in the currency in which each security is
denominated.
See accompanying notes
<PAGE>
Delaware Group Pooled Trust, Inc.-The International Equity Portfolio
Statement of Operations
Year ended October 31, 1994
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends $1,807,085
Interest 306,776 $2,113,861
----------
EXPENSES:
Management fees ($390,070) and directors'
fees ($2,814) 392,884
Custodian fees 34,730
Registration fees and organization expenses 26,473
Salaries 14,748
Auditing 11,700
Dividend disbursing and transfer
agent fees and expenses 9,886
Reports to shareholders 3,300
Other 15,077
----------
508,798
Less expenses absorbed by Delaware International
Advisers, Ltd. (15,248) 493,550
---------- ----------
NET INVESTMENT INCOME BEFORE FOREIGN
TAX WITHHELD 1,620,311
FOREIGN TAX WITHHELD (223,256)
----------
NET INVESTMENT INCOME 1,397,055
----------
NET REALIZED AND UNREALIZED GAIN
ON INVESTMENTS AND FOREIGN CURRENCIES:
Net realized gain (loss) on:
Investment transactions 1,577,440
Foreign currency (683,340)
----------
Net realized gain 894,100
Net unrealized appreciation of
investments and foreign currencies 3,228,171
----------
NET REALIZED AND UNREALIZED GAIN ON
INVESTMENTS AND FOREIGN CURRENCIES 4,122,271
----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $5,519,326
==========
</TABLE>
See accompanying notes
<PAGE>
Delaware Group Pooled Trust, Inc.-The International Equity Portfolio
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Year
Ended Ended
10/31/94 10/31/93
<S> <C> <C>
OPERATIONS:
Net investment income $ 1,397,055 $ 337,190
Net realized gain on security transactions
and foreign currencies 894,100 326,228
Net unrealized appreciation of investments and
foreign currencies during the period 3,228,171 2,830,309
----------- -----------
Net increase in net assets
resulting from operations 5,519,326 3,493,727
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (632,551) (369,273)
Net realized gain from security transactions (279,065) --
----------- -----------
(911,616) (369,273)
----------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 42,817,824 14,828,471
Net asset value of shares issued upon reinvestment
of dividends from net investment income and
net realized gain from security transactions 911,616 369,273
----------- -----------
43,729,440 15,197,744
Cost of shares repurchased (1,805,000) --
----------- -----------
Increase in net assets derived from
capital share transactions 41,924,440 15,197,744
----------- -----------
NET INCREASE IN NET ASSETS 46,532,150 18,322,198
NET ASSETS:
Beginning of period 24,287,854 5,965,656
----------- -----------
End of period (including undistributed net
investment income of $823,809 and $59,305,
respectively) $70,820,004 $24,287,854
=========== ===========
</TABLE>
See accompanying notes
<PAGE>
Delaware Group Pooled Trust, Inc.-The International Equity Portfolio
Notes to Financial Statements
October 31, 1994
1. Significant Accounting Policies
Delaware Pooled Trust, Inc. (the "Fund") is a diversified, no load, open-end
management investment company which is intended to meet a wide range of
investment objectives for large institutional clients with its seven separate
Portfolios. The Fund was organized under the laws of Maryland and is registered
under the Investment Company Act of 1940 (as amended). Each Portfolio
("Series") is in effect a separate fund issuing its own shares. As of October
31, 1994, only The Defensive Equity Portfolio, The Aggressive Growth Portfolio,
The International Equity Portfolio and The Global Fixed Income Portfolio had
commenced operations. The Fixed Income Portfolio, The Limited-Term Maturity
Portfolio and The International Fixed Income Portfolio had not commenced
operations except for the conduct of organizational matters. Like any
investment in securities, the value of the portfolio may be subject to risk of
loss from market, currency, economic and political factors which occur in the
countries where this Series is invested.
Portfolio securities listed or traded on a national securities exchange, except
for bonds, are valued at the closing 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 the mean between bid and asked prices. 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 as of 3:00 PM EST. Forward foreign currency
contracts are valued at the mean between the bid and asked prices of the
contracts.
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. Dividend income and distributions to shareholders are
recorded on the ex-dividend date. Dividends are recorded 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.
Costs incurred in connection with the Fund's organization and registration are
paid by each Series and amortized on a straight line method. Registration costs
were amortized over a two-year period and organization expenses are being
amortized over a five-year period following the initial sale.
The Series received $21,000 from the initial subscribers to purchase 2,100
shares at net asset value prior to the initial sale of the Series' shares. In
the event the initial subscribers redeem these shares during the five-year
period beginning with the date of initial public offering, there will be
deducted from the redemption proceeds attributable to such shares the then
unamortized portion of the organization expenses attributable to these shares.
2. Investment Management Fee and Other Transactions with Affiliates
Delaware International Advisers Ltd., the investment adviser, will receive a fee
to be paid quarterly, which is computed on the net assets of the Series as of
the close of business each day at the annual rate of 0.75%, less all amounts
paid to the unaffiliated directors.
Delaware International Advisers Ltd. has undertaken voluntarily to waive its fee
and reimburse The International Equity Portfolio to the extent that annual
operating expenses, exclusive of taxes, interest, brokerage commissions and
extraordinary expenses, exceed 0.96% of average net assets through April 30,
1995. Total expenses absorbed by Delaware International Advisers, Ltd. for the
year ended October 31, 1994 was $15,248. On October 31, 1994, the Series had an
investment management fee payable to Delaware International Advisers Ltd. of
$43,008.
<PAGE>
Notes to Financial Statements (Continued)
3. Investments
Investment securities based on cost for federal income tax purposes at October
31, 1994 are as follows:
<TABLE>
<S> <C>
Cost of investments $64,239,592
Aggregate unrealized appreciation 7,567,232
Aggregate unrealized depreciation (1,457,208)
-----------
Market value of investments $70,349,616
===========
</TABLE>
Net realized gain based on cost of specific certificate or bond for federal
income tax purposes was $1,577,296 for the year ended October 31, 1994.
During the year ended October 31, 1994, the Series had purchases of $50,837,607
and sales of $11,082,875 of investment securities other than U.S. government
securities and short-term debt securities having maturities of one year or less.
4. Foreign Exchange Contracts
The Series will, from time to time, enter into foreign currency exchange
contracts. There are costs and risks associated with such 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. Outstanding contracts as of
October 31, 1994 were as follows.
<TABLE>
<CAPTION>
Contract In Exchange Settlement Unrealized
To Deliver For Date Depreciation
---------- ----------- ---------- ------------
<S> <C> <C> <C>
2,524,684 British pounds $ 3,971,000 12/30/94 $(146,381)
4,594,318 Dutch guilders 2,647,000 12/30/94 (66,955)
678,445,680 Japanese yen 6,952,000 12/30/94 (56,012)
---------
$(269,348)
=========
</TABLE>
5. Industry Disclosure
As of October 31, 1994, the Series portfolio diversification was as follows:
<TABLE>
<CAPTION>
Percentage of Total
Industry Securities at Value
-------- -------------------
<S> <C>
Energy 18.11%
Consumer Cyclicals 13.29
Utilities 11.68
Capital Goods 11.29
Conglomerates 10.68
Financial 8.90
Industrial 7.93
Defensive Consumer Staples 5.68
Consumer Growth 5.17
Government Bonds 4.50
Repurchase Agreements 2.77
-------
Total 100.00%
=======
</TABLE>
6. Capital Stock
Transactions in capital stock shares were as follows:
<TABLE>
<CAPTION>
Year Year
Ended Ended
10/31/94 10/31/93
<S> <C> <C>
Shares sold 3,445,243 1,361,734
Share issued upon reinvestment
of dividends from net investment
income and net realized gain from
security transactions 73,798 36,503
----------- -----------
3,519,041 1,398,237
Shares repurchased (142,554) --
----------- -----------
Net increase 3,376,487 1,398,237
=========== ===========
7. Components of Net Assets
Common stock, $.01 par
value, 500,000,000
shares authorized to the Fund with
50,000,000 shares allocated to this Series $63,201,846
Accumulated undistributed income:
Net investment income 823,809
Net realized gain on investments and
foreign currencies 936,242
Net unrealized appreciation of investments
and foreign currencies 5,858,107
-----------
Total net assets applicable to 5,402,475
shares of common stock; equivalent
to $13.11 per share $70,820,004
===========
</TABLE>
<PAGE>
Notes to Financial Statement (Continued)
8. Financial Highlights
Selected data for each share of the Fund outstanding throughout the period were
as follows:
<TABLE>
<CAPTION>
Year Year 2/4/92*
Ended Ended to
10/31/94 10/31/93 10/31/92
<S> <C> <C> <C>
Net asset value, beginning of period $ 11.9900 $ 9.5000 $ 10.0000
Income (loss) from investment operations:
Net investment income 0.1440 0.2414 0.2282
Net realized and unrealized
gain (loss) from security transactions 1.2360 2.5686 (0.6282)
--------- --------- ---------
Total from investment operations 1.3800 2.8100 (0.4000)
Less distributions:
Dividends from net investment income (0.1600) (0.3200) (0.1000)
Distributions from net realized gain
from security transactions (0.1000) none none
--------- --------- ---------
Total distributions (0.2600) (0.3200) (0.1000)
Net asset value, end of period $ 13.1100 $ 11.9900 $ 9.5000
========= ========= =========
Total return 11.66% 30.28% (5.44%)
Ratios/supplemental data:
Net assets, end of period (000 omitted) $ 70,820 $ 24,288 $ 5,966
Ratio of expenses to average net assets 0.94%+ 0.96%+ 0.96%+
Ratio of net investment income to
average net assets 1.36%++ 2.98%++ 4.67%++
Portfolio turnover 22% 28% 2%
</TABLE>
-------------------
* Date of initial sale; ratios and total return have been annualized.
+ Ratio of expenses to average net assets prior to expense limitation was 0.97%
for the year ended 10/31/94, 1.38% for the year ended 10/31/93 and 2.94% for
the period from 2/4/92 to 10/31/92.
++ Ratio of net investment income to average net assets prior to expense
limitation was 1.33% for the year ended 10/31/94, 2.56% for the year ended
10/31/93 and 2.69% for the period from 2/4/92 to 10/31/92.
<PAGE>
Delaware Pooled Trust, Inc.-The International Equity Portfolio
Report of Independent Auditors
To the Shareholders and Board of Directors
Delaware Pooled Trust, Inc.-The International Equity Portfolio
We have audited the accompanying statement of net assets of Delaware Pooled
Trust, Inc.-The International Equity Portfolio as of October 31, 1994, the
related statements 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 two years in the period then ended and for
the period February 4, 1992 (date of initial sale) to October 31, 1992. 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
October 31, 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 Pooled Trust, Inc.-The International Equity Portfolio at October 31,
1994, 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 two years in the period then
ended and for the period from February 4, 1992 (date of initial sale) to October
31, 1992, in conformity with generally accepted accounting principles.
Philadelphia, Pennsylvania ERNST & YOUNG LLP
December 2, 1994
<PAGE>
DELAWARE POOLED TRUST
ONE COMMERCE SQUARE
2005 MARKET STREET
PHILADELPHIA, PA 19103
1-800-231-8002
<PAGE>
[LOGO OF DELAWARE POOLED
TRUST APPEARS HERE]
<PAGE>
[LOGO OF DELAWARE POOLED THE DEFENSIVE EQUITY PORTFOLIO
TRUST APPEARS HERE]
AUDITED
ANNUAL
REPORT
October 31, 1994
<PAGE>
DELAWARE POOLED TRUST, INC. -- THE DEFENSIVE EQUITY PORTFOLIO
The Defensive Equity Portfolio performed quite well over the course of the
fiscal year ended October 31, 1994. The Portfolio's return of 7.96%* exceeded by
more than double the 3.81% return of the unmanaged S&P 500 Index for the same
period.
The difficulties faced by stock investors throughout this past year are
evidenced by the S&P 500's return which is below long-term averages. Five
interest rate increases and underlying fears about inflation hurt both the stock
and bond markets during the period.
Our yield-driven management style combined with intensive research led us to
investments that enabled The Defensive Equity Portfolio to outperform the broad
stock market during this difficult time. Specifically, consumer growth, energy,
basic industry and the capital goods sectors benefited the Portfolio over the
course of the year.
Compared to the S&P 500, we had been slightly underweighted in consumer
growth stocks. However, since they have suffered a two-and-a-half year
consolidation since their highs in 1991 and, as a result, currently offer
significant yield premiums relative to many other stock sectors, we are looking
at opportunities in that area. Within the energy sector, our focus was on
international and domestic oil companies. Basic industry stocks were strong
performers for some of the same reasons as consumer growth stocks--a rebound
from their lows at the end of 1993.
At the fiscal year-end, The Defensive Equity Portfolio remained most heavily
invested in the same sectors that had performed well for us over the fiscal
year--consumer growth stocks, energy and credit-sensitive issues like banks. In
addition to these industries, we are examining stocks of chemical and paper
companies, as well as selected defense and electric utility companies, for
possible inclusion in the Portfolio.
Looking toward the future from a macroeconomic perspective, we expect that
further interest rate increases are likely, though there is still some debate
over evidence of inflation in the economy. Many sectors of the market seem
overvalued in the current environment. Since our strategy's use of yield as a
benchmark for stock selection forces us to focus on out-of-favor, undervalued
stocks, it should help guide us away from those sectors of the market that would
be most vulnerable to a correction.
<PAGE>
<TABLE>
<CAPTION>
Defensive Equity Portfolio Standard & Poor's 500 Index
-------------------------- ---------------------------
<S> <C> <C>
1/31/92 $10,000 --
2/29/92 10,150 $ 9,972
3/31/92 10,110 9,825
4/30/92 10,581 10,099
5/31/92 10,601 10,109
6/30/92 10,551 10,012
7/31/92 10,882 10,406
8/31/92 10,571 10,157
9/30/92 10,741 10,328
10/31/92 10,741 10,349
11/30/92 11,194 10,663
12/31/92 11,356 10,845
1/31/93 11,480 10,922
2/28/93 11,689 11,036
3/31/93 12,254 11,317
4/30/93 12,222 11,030
5/31/93 12,412 11,280
6/30/93 12,527 11,371
7/31/93 12,611 11,311
8/31/93 13,221 11,700
9/30/93 13,232 11,664
10/31/93 13,444 11,890
11/30/93 13,317 11,737
12/31/93 13,562 11,934
1/31/94 14,101 12,321
2/28/94 13,771 11,951
3/31/94 13,320 11,485
4/30/94 13,640 11,617
5/31/94 14,004 11,761
6/30/94 13,817 11,534
7/31/94 14,204 11,897
8/31/94 14,668 12,345
9/30/94 14,380 12,098
10/31/94 14,514 12,350
</TABLE>
The Defensive
Equity Portfolio
Average Annual
Total Return*
through October 31, 1994
Lifetime ............ 14,55%
One Year ............ 7.96%
Though it is considered a relatively conservative approach to stock investing,
The Defensive Equity Portfolio has performed well compared to the broader
based, unmanaged S&P 500 stock index. A $10,000 investment made at the
Portfolio's inception on February 3, 1992 would have grown to $14,514 by
October 31, 1994. The S&P 500 Index would have grown to $12,350 over the same
period.
All dividends and capital gains have been reinvested for The Defensive Equity
Portfolio and the Index. Past performance is not a guarantee of future results.
Return and share value will fluctuate so that shares, when redeemed, may be
worth more or less than the original investment. No adjustments have been made
for taxes.
*During this period, Delaware Management Company voluntarily agreed to waive its
fee and reimburse the Portfolio to the extent that annual operating expenses,
exclusive of taxes, interest, brokerage commissions and extraordinary expenses,
exceed .68% of average net assets. In the absence of the waiver, the Portfolio's
total return would have been lower.
<PAGE>
Delaware Pooled Trust, Inc.-The Defensive Equity Portfolio
Statement of Net Assets
October 31, 1994
<TABLE>
<CAPTION>
Number Market
of Shares Value
<S> <C> <C>
COMMON STOCK-92.69%
Capital Goods-0.37%
Honeywell 4,300 $ 138,675
----------
$ 138,675
----------
Chemicals-12.13%
Dow Chemical 7,703 $ 566,171
DuPont (EI) deNemours 12,239 729,750
Grace (W.R.) 20,100 796,463
Imperial Chemical Industries ADR 12,700 660,400
Merck & Co. 11,000 393,250
Monsanto 11,600 883,050
Upjohn 10,900 359,700
Witco 5,000 140,000
----------
4,528,784
----------
Commercial Banks-8.82%
BankAmerica 10,900 474,150
Bankers Trust NY 6,047 403,637
Chase Manhattan 12,000 432,000
Chemical Bank 2,800 106,400
Great Western Financial 5,800 103,675
KeyCorp 16,560 474,030
Mellon Bank 1,600 89,000
Meridian Bancorp 2,400 69,450
Morgan (J.P.) 6,500 402,188
NationsBank 8,184 405,108
PNC Financial Group 14,062 330,457
----------
3,290,095
----------
Communications-7.70%
ALLTEL 26,682 690,397
Ameritech 14,500 585,438
BellSouth 7,000 372,750
British Telecommunications ADR 8,500 547,188
Pacific Telesis Group 13,500 426,938
Rochester Telephone 10,200 249,900
----------
2,872,611
----------
Consumer Group-21.01%
American Home Products 7,637 484,950
Dun & Bradstreet 11,003 645,051
Eastman Kodak 10,013 481,876
General Electric 19,800 967,725
General Mills 9,500 532,000
K Mart 13,122 214,873
Kimberly-Clark 13,600 700,400
McGraw-Hill 10,100 754,975
Penney (J.C.) 12,800 648,000
Sears, Roebuck 23,300 1,153,350
SmithKline Beecham ADR Unit 11,900 362,950
Times Mirror 24,000 783,000
Warner-Lambert 1,500 114,375
----------
7,843,525
----------
Electric-0.98%
Public Service Enterprise 14,000 367,500
----------
367,500
----------
Energy-19.68%
Amoco 16,900 1,071,038
Atlantic Richfield 7,582 821,699
Dresser Industries 18,700 395,038
Exxon 13,600 855,100
McDermott International 7,200 184,500
Mobil 10,100 868,600
Occidental Petroleum 27,300 597,188
Sonat 4,000 130,000
Tenneco 11,200 495,600
Texaco 9,800 640,675
Union Pacific 7,000 342,125
USX-Marathon Group 31,100 583,125
YPF Sociedad Anonima ADR 15,000 361,875
----------
7,346,563
----------
</TABLE>
<PAGE>
Statement of Net Assets (Continued)
<TABLE>
<CAPTION>
Number Market
of Shares Value
<S> <C> <C>
COMMON STOCK (Continued)
Financial-10.30%
Aetna Life & Casualty 11,700 $ 539,663
American Express 24,382 749,747
American Express "FDC" 6,800 306,000
AON 10,900 339,263
CIGNA 8,813 580,556
Lincoln National 4,200 152,250
Marsh & McLennan 8,519 638,925
St. Paul Companies 12,300 536,588
-----------
3,842,992
-----------
Manufacturing-10.01%
Copper Industries 14,000 523,250
General Dynamics 7,100 300,863
Hanson plc ADR 23,400 435,825
Minnesota Mining & Manufacturing 14,512 803,602
Thomas & Betts 8,500 605,625
Union Camp 8,500 403,750
United Technologies 10,513 662,319
-----------
3,735,234
-----------
Transportation-1.69%
Norfolk Southern 10,000 630,000
-----------
630,000
-----------
Total Common Stock (cost $33,974,848) 34,595,979
-----------
PREFERRED STOCK-4.18%
Ford Motor 4.20% convertible preferred 6,300 609,525
Freeport - McMoRan Copper & Gold 7.00% convertible
preferred 3,500 89,688
General Motors $3.25 convertible preferred "C" 9,400 527,575
RJR Nabisco Holdings $0.6012 convertible preferred "C" 48,500 333,438
-----------
Total Preferred Stock (cost $1,569,085) 1,560,226
-----------
Principal
Amount
REPURCHASE AGREEMENTS-3.00%
With Prudential Securities 4.76% 11/1/94
(dated 10/31/94, collateralized by $1,162,000
U.S. Treasury Notes 4.625% due 2/29/96,
market value $1,143,830) $1,121,000 1,121,000
-----------
Total Repurchase Agreements
(cost $1,121,000) 1,121,000
-----------
TOTAL MARKET VALUE OF SECURITIES-99.88%
(cost $36,664,933) 37,277,205
RECEIVABLES AND OTHER ASSETS NET OF LIABILITIES- 0.12% 45,953
-----------
NET ASSETS APPLICABLE TO 2,853,015 SHARES ($.01 PAR VALUE)
OUTSTANDING; EQUIVALENT TO $13.08 PER SHARE-100.00% $37,323,158
============
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust, Inc.-The Defensive Equity Portfolio
Statement of Operations
Year Ended October 31, 1994
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Dividends $808,772
Interest 83,498 $892,270
--------
EXPENSES:
Management fees ($121,537) and directors'
fees ($2,813) 124,350
Registration fees and organization expenses 17,422
Custodian fees 11,962
Auditing 8,508
Salaries 6,310
Dividend disbursing and transfer
agent fees and expenses 4,183
Reports to shareholders 3,030
Taxes (other than income) 1,675
Legal 800
Other 8,546
--------
186,786
Less expenses absorbed by Delaware
Management Company, Inc. (33,192) 153,594
-------- ---------
NET INVESTMENT INCOME 738,676
---------
NET REALIZED GAIN AND UNREALIZED
LOSS ON INVESTMENTS:
Net realized gain from
security transactions 1,535,246
Net unrealized depreciation of
investments during the period (461,803)
----------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS 1,073,443
----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $1,812,119
==========
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust, Inc.-The Defensive Equity Portfolio
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Ended Year Ended
10/31/94 10/31/93
<S> <C> <C>
OPERATIONS:
Net investment income $ 738,676 $ 243,071
Net realized gain on investments 1,535,246 421,825
Net unrealized appreciation (depreciation) during
the period (461,803) 1,051,273
----------- -----------
Net increase in net assets resulting from
operations 1,812,119 1,716,169
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (419,984) (186,308)
Net realized gain from security transactions (422,183) (93,097)
----------- -----------
(842,167) (279,405)
----------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 25,095,763 8,410,633
Net asset value of shares issued upon reinvestment
of dividends from net investment income and net
realized gains from security transactions 838,997 279,405
----------- -----------
25,934,760 8,690,038
Cost of shares repurchased (3,000,000) (1,181,461)
----------- -----------
INCREASE IN NET ASSETS DERIVED FROM
CAPITAL SHARE TRANSACTIONS 22,934,760 7,508,577
----------- -----------
NET INCREASE IN NET ASSETS 23,904,712 8,945,341
NET ASSETS:
Beginning of period 13,418,446 4,473,105
----------- -----------
End of period (including undistributed net
investment income of $438,019 and
$119,327, respectively) $37,323,158 $13,418,446
=========== ===========
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust, Inc.-The Defensive Equity Portfolio
Notes to Financial Statements
October 31, 1994
1. Significant Accounting Policies
Delaware Pooled Trust, Inc. (the "Fund") is a diversified, no load, open-end
management investment company which is intended to meet a wide range of
investment objectives for large institutional clients with its seven separate
Portfolios. The Fund was organized under the laws of Maryland and is registered
under the Investment Company Act of 1940 (as amended). Each Portfolio
("Series") is in effect a separate fund issuing its own shares. As of October
31, 1994, only The Defensive Equity Portfolio, The Aggressive Growth Portfolio,
The International Equity Portfolio and The Global Fixed Income Portfolio had
commenced operations. The Fixed Income Portfolio, The Limited-Term Maturity
Portfolio and The International Fixed Income Portfolio had not commenced
operations except for the conduct of organizational matters.
Portfolio securities listed or traded on a national securities exchange, except
for bonds, are valued at the closing price on the exchange where they are
primarily traded. Securities not traded on a particular day, over-the-counter
securities and government and agency securities are valued at the mean 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.
Prices provided by the 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.
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. 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.
Costs incurred in connection with the Fund's organization and registration are
paid by each Series and amortized on the straight line method. Registration
costs were amortized over a two-year period and organization expenses are being
amortized over a five-year period following the initial sale.
The Series received $21,000 from the initial subscribers to purchase 2,100
shares at net asset value prior to the initial sale of the Series' shares. In
the event the initial subscribers redeem these shares during the five-year
period beginning with the date of initial sale, there will be deducted from the
redemption proceeds attributable to such shares the then unamortized portion of
the organization expenses attributable to these shares.
2. Investment Management Fee and Other Transactions with Affiliates
Delaware Management Company, Inc., the investment adviser of the Portfolio, will
receive a fee to be paid quarterly, which is computed on the net assets of the
Portfolio as of the close of business each day at the annual rate of 0.55%, less
all amounts paid to the unaffiliated directors.
Delaware Management Company, Inc. has undertaken voluntarily to waive its fee
and reimburse The Defensive Equity Portfolio to the extent that annual operating
expenses, exclusive of taxes, interest, brokerage commissions and extraordinary
expenses exceed, 0.68% of average net assets through April 30, 1995. Total
expenses absorbed by Delaware Management Company, Inc. for the year ended
October 31, 1994 were $33,192.
On October 31, 1994, the Series had investment management fees payable to
Delaware Management Company, Inc. of $12,934 after the fee waiver.
<PAGE>
Notes to Financial Statements (Continued)
3. Investments
Investment securities based on cost for federal income tax purposes at October
31, 1994 are as follows:
<TABLE>
<S> <C>
Cost of investments $36,675,954
Aggregate unrealized appreciation 1,571,239
Aggregate unrealized depreciation (969,988)
-----------
Market value of investments $37,277,205
===========
</TABLE>
Net realized gain for federal income tax purposes was $1,545,471 for the year
ended October 31, 1994.
During the year ended October 31, 1994, the Series had purchases of $37,647,365
and sales of $15,102,556 of investment securities other than U.S. government
securities and short-term debt securities having maturities of one year or less.
On October 31, 1994, the Series had a receivable for investment securities sold
of $80,922 and a payable for investment securities purchased of $169,147.
4. Capital Stock
Transactions in capital stock shares were as follows:
<TABLE>
<CAPTION>
Year Year
Ended Ended
10/31/94 10/31/93
<S> <C> <C>
Shares sold 1,965,280 709,304
Shares issued upon reinvestment of dividends from net
investment income and net realized gains from security
transactions 67,602 24,796
--------- --------
2,032,882 734,100
Shares repurchased (234,132) (99,450)
--------- --------
Net increase 1,798,750 634,650
========= ========
</TABLE>
<PAGE>
Notes to Financial Statements (Continued)
<TABLE>
<S> <C>
5. Components of Net Assets
Common stock, $.01 par value, 500,000,000
shares authorized to the Fund with
50,000,000 shares allocated to this Series $34,738,381
Accumulated undistributed income:
Net investment income 438,019
Net realized gain on investments 1,534,486
Net unrealized appreciation of investments 612,272
-----------
Total net assets applicable to 2,853,015
shares of common stock; equivalent
to $13.08 per share $37,323,158
===========
</TABLE>
6. Financial Highlights
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
Year Year 2/3/92*
Ended Ended to
10/31/94 10/31/93 10/31/92
<S> <C> <C> <C>
Net asset value, beginning of period $ 12.7300 $ 10.6600 $ 10.0000
Income from investment operations:
Net investment income 0.3203 0.2841 0.2291
Net realized and unrealized
gain from security transactions 0.6527 2.3159 0.5109
--------- --------- ---------
Total from investment operations 0.9730 2.6000 0.7400
--------- --------- ---------
Less distributions:
Dividends from net investment income (0.2800) (0.3200) (0.0800)
Distributions from net realized gain on
security transactions (0.3430) (0.2100) none
--------- --------- ---------
Total distributions (0.6230) (0.5300) (0.0800)
--------- --------- ---------
Net asset value, end of period 13.0800 12.7300 10.6600
========= ========= =========
Total return 7.96% 25.17% 10.13%
Ratios/supplemental data:
Net assets, end of period (000 omitted) $ 37,323 $ 13,418 $ 4,473
Ratio of expenses to average net assets 0.68%+ 0.68%+ 0.68%+
Ratio of net investment income to average
net assets 3.26%++ 2.90%++ 3.65%++
Portfolio turnover 73% 37% 28%
</TABLE>
----------------------
* Date of initial sale; ratios and total return have been annualized.
+ Ratio of expenses to average net assets prior to expense limitation was
0.82% for the year ended 10/31/94, 1.38% for the year ended 10/31/93 and
2.38% for the period from 2/3/92 to 10/31/92.
++ Ratio of net investment income to average net assets prior to expense
limitation was 3.12% for the year ended 10/31/94, 2.20% for the year ended
10/31/93 and 1.95% for the period from 2/3/92 to 10/31/92.
<PAGE>
Delaware Pooled Trust, Inc.-The Defensive Equity Portfolio
Report of Independent Auditors
To the Shareholders and Board of Directors
Delaware Pooled Trust, Inc.-The Defensive Equity Portfolio
We have audited the accompanying statement of net assets of Delaware Pooled
Trust, Inc.-The Defensive Equity Portfolio as of October 31, 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 two years in the period then ended and
the period February 3, 1992 (date of initial sale ) to October 31, 1992. 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
October 31, 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 Pooled Trust, Inc.-The Defensive Equity Portfolio at October 31, 1994,
the results of its operations for the year then ended and 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 two years in the period then ended and the period
February 3, 1992 (date of initial sale) to October 31, 1992, in conformity with
generally accepted accounting principles.
ERNST & YOUNG LLP
Philadelphia, Pennsylvania
December 2, 1994
<PAGE>
DELAWARE POOLED TRUST
ONE COMMERCE SQUARE
2005 MARKET STREET
PHILADELPHIA, PA 19103
1-800-231-8002
<PAGE>
[LOGO OF DELAWARE POOLED
TRUST APPEARS HERE]
<PAGE>
[LOGO OF DELAWARE POOLED THE GLOBAL FIXED INCOME PORTFOLIO
TRUST APPEARS HERE]
AUDITED
ANNUAL
REPORT
October 31, 1994
<PAGE>
DELAWARE POOLED TRUST, INC.--THE GLOBAL FIXED INCOME PORTFOLIO
The Global Fixed Income Portfolio provided a return of +2.07%* for the
fiscal year ended October 31, 1994. This was impressive compared with returns in
the U.S. bond market, as evidenced by the -17.5% return of the 30-year U.S.
Treasury and the -1.93% return from the unmanaged Lehman Brothers Government
Corporate Intermediate Index, and supports the value of including foreign
investments in a portfolio even given certain added risks such as currency
fluctuation. However, the Portfolio's return was less than that of its benchmark
index, the Salomon World Government Bond Index, which rose 4.90% over the
period.
The worldwide bond rally of the early 1990s appears to have ended in
February 1994, when the U.S. Federal Reserve Board began a series of interest
rate increases. Bond markets around the world experienced sell-offs, as
inflation fears surrounded the rising rates in the U.S. markets.
Although bond markets across the globe have fallen due to the weakness
of the dollar overseas, both the Salomon Index and your Portfolio had positive
returns. The Portfolio underperformed the Salomon Index over the fiscal year
because, relative to the Index, we were underweighted in both Japanese bonds and
the Yen which were both strong performers in the middle of the year. However, we
still have reservations about Japan's ability to return to economic vitality in
the near term and, as of October 31, 1994, had no exposure to that market.
We currently believe Australia is one of the most attractive bond markets
worldwide. Inflation in Australia is low and government finances have improved
with the country's economic growth. At this time, we also consider European
markets such as Italy, Sweden and Spain to be attractive because of their
relatively high yields. We remain underweighted in the U.S. bond market, but are
exposed to moves in the dollar through our investments in Canadian, Australian
and New Zealand bonds.
Over the past 12 months, we have increased The Global Fixed Income
Portfolio's defensive hedges into the dollar. At the beginning of the period,
the Portfolio was underweighted in all currencies tied to the U.S. dollar.
However, over the last 12 months, we have seen the dollar fall by over 11%
against the Japanese yen and the core European currencies. While the main cause
for this has been the market's perception that the large U.S. trade deficit
should dictate the dollar's exchange rate, the result is that the dollar now
appears undervalued based on our purchasing power analysis.
European bond markets have been overshadowed by investors' expectations
that the period of falling interest rates in Germany is coming to an end. As a
result, concerns over the region's public debt and political problems have
resurfaced. With inflation still low throughout most of Europe, we believe that
the opportunity for attractive real returns from these countries still exists.
<PAGE>
<TABLE>
<CAPTION>
Global Fixed Income Portfolio Salomon World Gov't Lehman Gov't/Corp
--------------------------------------------------------------------------------
Bond Index Bond Index
---------------------------------------
<S> <C> <C> <C>
11/30/92 $10,000 $10,000 $10,000
12/31/92 10,110 10,059 10,171
1/31/93 10,260 10,235 10,392
2/28/93 10,540 10,436 10,608
3/31/93 10,749 10,596 10,644
4/30/93 10,902 10,820 10,726
5/31/93 11,068 10,929 10,721
6/30/93 11,099 10,905 10,964
7/31/93 11,060 10,938 11,035
8/31/93 11,426 11,265 11,288
9/30/93 11,541 11,508 11,328
10/31/93 11,733 11,380 11,374
11/30/93 11,691 11,298 11,246
12/31/93 12,047 11,394 11,295
1/31/94 12,306 11,486 11,465
2/28/94 12,114 11,411 11,215
3/31/94 11,928 11,394 10,940
4/30/94 11,987 11,408 10,849
5/31/94 11,930 11,307 10,830
6/30/94 11,630 11,471 10,859
7/31/94 11,661 11,562 11,021
8/31/94 11,818 11,522 11,025
9/30/94 11,830 11,605 10,859
10/31/94 11,977 11,791 10,847
</TABLE>
The Global
Fixed Income
Portfolio
Average Annual
Total Return*
through October 31, 1994
Lifetime...........9.84%
A $10,000 investment in The Global Fixed Income Portfolio on November 30, 1992
would have grown to $11,977 by October 31, 1994. This compares to $11,791 for
the Salomon World Government Bond Index, and to $10,847 for the Lehman
Government/Corporate Index, a U.S. bond index.
All dividends and capital gains have been reinvested for The Global Fixed Income
Portfolio and the Indexes. Past performance is not a guarantee of future
results. Return and share value will fluctuate so that shares, when redeemed,
may be worth more or less than the original investment. No adjustments have been
made for taxes.
* During this period, Delaware Management Company voluntarily agreed to waive
its fee and reimburse the portfolio to the extent that annual operating
expenses, exclusive of taxes, interest, brokerage commissions and extraordinary
expenses, exceed .62% of average net assets through November 1, 1994 and .60%
through April 30, 1995. In the absence of the waiver, the Portfolio's total
return would have been lower.
<PAGE>
Delaware Pooled Trust,Inc.-The Global Fixed Income Portfolio
Statement of Investments
October 31, 1994
<TABLE>
<CAPTION>
Market
Principal Value
Amount* (U.S.$)
<S> <C> <C>
BONDS-98.96%
Australia-21.79%
Australian Government 9.50% 2003 4,000,000 $ 2,805,730
Australian Government 9.00% 2004 1,600,000 1,078,997
Cadbury Schweppes, Australia 8.50% 1999 1,500,000 1,032,544
Commonwealth Bank of Australia 13.75% 1999 1,750,000 1,463,583
South Australia Government 9.00% 2002 1,750,000 1,182,718
State Bank of New South Wales 9.00% 2002 1,750,000 1,183,529
-----------
8,747,101
-----------
Canada-15.14%
Banque National de Paris 8.75% 2002 1,000,000 708,872
Bell Canada 10.875% 2004 700,000 546,673
BP America 10.875% 2001 300,000 235,397
BP America 9.50% 2002 1,000,000 731,516
Government of Canada 10.25% 2014 1,300,000 1,042,307
Deutsche Bank 10.25% 1999 400,000 310,536
Electricity Power Development 10.375% 2001 700,000 540,203
Nippon Telephone & Telegraph 10.25% 1999 800,000 620,333
Ontario Hydro 10.00% 2001 650,000 500,116
Prudential Funding 9.125% 1997 700,000 525,323
Treasury Corp. Victoria 7.25% 2003 500,000 315,619
-----------
6,076,895
-----------
France-7.88%
France OAT 6.75% 2003 1,000,000 175,476
France OAT 8.50% 2023 10,000,000 1,887,626
Guinness Finance 9.75% 1996 3,500,000 702,037
Saint-Gobain Nederland 10.50% 1995 2,000,000 399,469
-----------
3,164,608
-----------
Greece-13.73%
Abbey National Treasury 15.75% 1997 200,000,000 787,799
European Bank of Reconstruction and
Development 15.25% 1998 100,000,000 396,052
European Investment Bank 17.50% 1999 450,000,000 1,888,779
International Bank of Reconstruction
and Development 15.50% 1997 525,000,000 2,147,074
International Finance 15.25% 1999 75,000,000 295,021
-----------
5,514,725
-----------
Italy-7.27%
BTP Italian Government 12.00% 2003 3,000,000,000 1,960,355
Nordic Investment Bank 11.30% 2002 1,500,000,000 957,812
-----------
2,918,167
-----------
New Zealand-10.20%
New Zealand Government 9.00% 1996 3,500,000 2,160,345
New Zealand Government 6.50% 2000 3,500,000 1,935,776
-----------
4,096,121
-----------
Spain-7.73%
Spanish Government 10.50% 2003 50,000,000 381,254
Spanish Government 8.20% 2009 230,000,000 1,455,363
World Bank 10.625% 1998 160,000,000 1,265,932
-----------
3,102,549
-----------
Sweden-12.76%
Nordic Investment Bank 10.25% 1999 8,000,000 1,088,781
Swedish Government 9.00% 2009 34,000,000 4,036,200
-----------
5,124,981
-----------
United Kingdom-2.46%
Mutual Group 7.25% 2004 200,000 265,979
Nationwide Anglia 13.50% 2000 200,000 377,466
Redland Funding 10.875% 2001 200,000 345,263
-----------
988,708
-----------
Total Bonds (cost $ 40,064,335) 39,733,855
-----------
</TABLE>
<PAGE>
Statement of Investments (Continued)
<TABLE>
<CAPTION>
Market
Principal Value
Amount* (U.S.$)
<S> <C> <C>
Repurchase Agreements-1.04%
With Prudential Securities 4.76% 11/1/94
(dated 10/31/94, collateralized by
$434,000 U.S. Treasury Notes 4.625%
due 2/29/96, market value $427,533) 419,000 $ 419,000
-----------
Total Repurchase Agreements (cost $419,000) 419,000
-----------
TOTAL MARKET VALUE OF SECURITIES-100.00%
(Cost $40,483,335) $40,152,855
===========
</TABLE>
--------------------------------------------------------------------------------
*Principal amount is stated in the currency of the country in which
each security is denominated.
See accompanying notes
<PAGE>
Delaware Pooled Trust,Inc.-The Global Fixed Income Portfolio
Statement of Assets and Liabilities
October 31, 1994
<TABLE>
<CAPTION>
ASSETS:
<S> <C>
Investments at market (cost $40,483,335) $40,152,855
Dividends and interest receivable 1,851,745
Cash and foreign currencies 157,216
Other assets 153,033
-----------
42,314,849
-----------
LIABILITIES:
Accounts payable and other accrued expenses 49,259
-----------
49,259
-----------
NET ASSETS $42,265,590
===========
Shares outstanding 4,315,243
===========
Net asset value $9.79
===========
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust,Inc.-The Global Fixed Income Portfolio
Statement of Operations
Year Ended October 31, 1994
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Interest $3,286,861
EXPENSES:
Management fees ($175,663) and directors'
fees ($2,813) 178,476
Custodian fees 26,480
Registration fees 19,008
Auditing 14,700
Salaries 10,539
Dividend disbursing and transfer
agent fees and expenses 6,116
Taxes (other than income) 3,820
Reports to shareholders 1,590
Other 10,907
----------
271,636
Less expenses absorbed by Delaware
International Advisers, Ltd. (50,758) 220,878
---------- -----------
NET INVESTMENT INCOME 3,065,983
-----------
NET REALIZED AND UNREALIZED LOSS ON
INVESTMENTS AND FOREIGN CURRENCIES:
Net realized loss on:
Security transactions (429,109)
Foreign currency (1,772,027)
----------
Net realized loss (2,201,136)
Net unrealized depreciation of
investments and foreign currencies during the period (134,425)
-----------
NET REALIZED AND UNREALIZED LOSS ON
INVESTMENTS AND FOREIGN CURRENCIES (2,335,561)
-----------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 730,422
===========
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust,Inc.-The Global Fixed Income Portfolio
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year 11/30/92*
Ended to
10/31/94 10/31/93
<S> <C> <C>
OPERATIONS:
Net investment income $ 3,065,983 $ 1,680,302
Net realized gain (loss) on foreign currencies
and security transactions (2,201,136) 2,201,502
Net unrealized depreciation (appreciation) of
investments and foreign currencies during
the period (134,425) 17,253
----------- -----------
Net increase in net assets
resulting from operations 730,422 3,899,057
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (3,001,453) (1,440,693)
Net realized gain from security transactions (1,523,836) ---
----------- -----------
(4,525,289) (1,440,693)
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 13,502,167 26,223,944
Net asset value of shares issued upon reinvestment
of dividends from net investment income and net
realized gain from security transactions 4,525,289 1,440,693
----------- -----------
18,027,456 27,664,637
Cost of shares repurchased (1,280,000) (810,000)
----------- -----------
Increase in net assets derived from
capital share transactions 16,747,456 26,854,637
----------- -----------
NET INCREASE IN NET ASSETS 12,952,589 29,313,001
NET ASSETS:
Beginning of period 29,313,001 ---
----------- -----------
End of period $42,265,590 $29,313,001
=========== ===========
</TABLE>
-------------------
*Date of initial sale.
See accompanying notes
<PAGE>
Delaware Pooled Trust,Inc.-The Global Fixed Income Portfolio
Notes to Financial Statements
October 31, 1994
1. Significant Accounting Policies
Delaware Pooled Trust, Inc. (the "Fund") is a diversified, no load, open-end
management investment company which is intended to meet a wide range of
investment objectives for large institutional clients with its seven separate
Portfolios. The Fund was organized under the laws of Maryland and is registered
under the Investment Company Act of 1940 (as amended). Each Portfolio
("Series") is a separate fund issuing its own shares. As of October 31, 1994,
only The Defensive Equity Portfolio, The Aggressive Growth Portfolio, The
International Equity Portfolio and The Global Fixed Income Portfolio had
commenced operations. The Fixed Income Portfolio, The Limited-Term Maturity
Portfolio and The International Fixed Income Portfolio had not commenced
operations except for the conduct of organizational matters. Like any
investment in securities, the value of the Portfolio may be subject to risk of
loss from market, currency, economic and political factors which occur in the
countries where the Portfolio is invested.
Portfolio securities listed or traded on a national securities exchange, except
for bonds, are valued at the closing price on the exchange where they are
primarily traded. Securities not traded on a particular day, over-the-counter
securities and government and agency securities are valued at the mean 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.
Prices provided by the 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. 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 of 3:00 PM EST. Forward foreign currency
contracts are valued at the mean between the bid and asked prices of the
contracts.
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. Dividends are recorded, 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.
2. Investment Management Fee and Other Transactions with Affiliates
Delaware International Advisers Ltd., the investment adviser, will receive a fee
to be paid quarterly, which is computed on the net assets of the Series as of
the close of business each day at the annual rate of 0.50%, less all amounts
paid to the unaffiliated directors.
Delaware International Advisers Ltd. has undertaken voluntarily to waive its fee
and reimburse the Series to the extent that annual operating expenses, exceed
0.62% of average net assets through October 31, 1994 and effective November 1,
1994 the waiver was modified to limit operating expenses to .60% through April
30, 1995.Total expenses absorbed by Delaware International Advisers, Ltd. for
the year ended October 31, 1994 were $50,758.
On October 31, 1994, the Series had an investment management fee payable to
Delaware International Advisors Ltd. of $14,576 after the fee waiver.
<PAGE>
Notes to Financial Statements (Continued)
3. Investments
Investment securities based on cost for federal income tax purposes at October
31, 1994 are as follows:
<TABLE>
<S> <C>
Cost of investments $40,539,789
Aggregate unrealized appreciation 873,734
Aggregate unrealized depreciation (1,260,668)
-----------
Market value of investments $40,152,855
===========
</TABLE>
Net realized loss based on cost of specific certificate or bond for federal
income tax purposes was $372,655 for the year ended October 31, 1994.
During the year ended October 31, 1994, the Series had purchases of $79,990,448
and sales of $66,768,899 of investment securities other than U.S. government
securities and short-term debt securities having maturities of one year or less.
4. Foreign Exchange Contracts
The Series will, from time to time, enter into foreign currency exchange
contracts. There are costs and risks associated with such 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. Outstanding contracts as of
October 31, 1994 were as follows:
<TABLE>
<CAPTION>
Contract In Exchange Settlement Unrealized
to Deliver for Date Appreciation
---------- ----------- ---------- ------------
<S> <C> <C> <C>
16,500,000 French francs $3,221,933 1/31/95 $32,212
380,000,000 Spanish pesetas 3,029,095 1/31/95 24,707
35,500,000 Swedish krone 4,995,216 1/31/95 95,292
--------
$152,211
========
</TABLE>
5. Capital Stock
Transactions in capital stock shares were as follows:
<TABLE>
<CAPTION>
Year 11/30/92*
Ended to
10/31/94 10/31/93
<S> <C> <C>
Shares sold 1,356,353 2,584,118
Shares issued upon reinvestment of dividends
from net investment income and net realized
gain from security transactions 443,778 134,015
--------- ---------
1,800,131 2,718,133
Shares repurchased (127,578) (75,443)
--------- ---------
Net increase 1,672,553 2,642,690
========= =========
</TABLE>
---------------------------
* Date of initial sale
<PAGE>
Notes to Financial Statements (Continued)
6. Components of Net Assets
<TABLE>
<S> <C>
Common stock, $.01 par value, 500,000,000
shares authorized to the Fund with
50,000,000 shares allocated to this Series $43,602,093
Accumulated undistributed income:
Net investment income 304,139
Net realized loss on investments and foreign securities (1,523,470)
Net unrealized depreciation of investments
and foreign currencies (117,172)
-----------
Total net assets applicable to 4,315,243
shares of common stock; equivalent
to $9.79 per share $42,265,590
===========
</TABLE>
7. Financial Highlights
Selected data for each share of the Fund outstanding throughout the period were
as follows:
<TABLE>
<CAPTION>
Year 11/30/92*
Ended to
10/31/94 10/31/93
<S> <C> <C>
Net asset value, beginning of period $ 11.0900 $ 10.0000
Income from investment operations:
Net investment income .4189 .9547
Net realized and unrealized
gain (loss) from security transactions (.1929) .7433
--------- ---------
Total from investment operations 0.2260 1.6980
--------- ---------
Less distributions:
Dividends from net investment income (.9490) (.6080)
Distributions from net realized gain
on security transactions (.5770) none
--------- ---------
Total distributions (1.5260) (.6080)
--------- ---------
Net asset value, end of period $ 9.7900 $ 11.0900
========= =========
Total return 2.07% 18.96%
Ratios/supplemental data:
Net assets, end of period (000 omitted) $ 42,266 $ 29,313
Ratio for expenses to average net assets 0.62%+ 0.62%+
Ratio of net investment income to average net assets 3.62%++ 10.68%++
Portfolio turnover 205% 198%
</TABLE>
-------------
* Date of initial sale; ratios and total return have been annualized.
+ Ratio of expenses to average net assets prior to expense limitation was
0.76% for the year ended 10/31/94 and 0.88% for the period 11/30/92 to
10/31/93.
++ Ratio of net investment income to average net assets prior to expense
limitation was 3.48% for the year ended 10/31/94 and 10.42% for the period
11/30/92 to 10/31/93.
<PAGE>
Delaware Pooled Trust,Inc.-The Global Fixed Income Portfolio
Report of Independent Auditors
To the Shareholders and Board of Directors
Delaware Pooled Trust,Inc.-The Global Fixed Income Portfolio
We have audited the accompanying statement of assets and liabilities, including
the statement of investments, of Delaware Pooled Trust,Inc.-The Global Fixed
Income Portfolio as of October 31, 1994, and the related statement of operations
for the year then ended, the statement of changes in net assets for the year
ended October 31, 1994 and the period November 30, 1992 (date of initial sale)
to October 31, 1993 and the financial highlights for the year ended October 31,
1994 and the period November 30, 1992 (date of initial sale) to October 31,
1993. 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
October 31, 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 Pooled Trust,Inc.-The Global Fixed Income Portfolio at October 31,
1994, the results of its operations for the year ended October 31, 1994, the
changes in its net assets for the year ended October 31, 1994 and the period
November 30, 1992 (date of initial sale) to October 31, 1993, and the financial
highlights for the year ended October 31, 1994 and the period November 30, 1992
(date of initial sale) to October 31, 1993, in conformity with general accepted
accounting principles.
ERNST & YOUNG LLP
Philadelphia, Pennsylvania
December 2, 1994
<PAGE>
DELAWARE POOLED TRUST
ONE COMMERCE SQUARE
2005 MARKET STREET
PHILADELPHIA, PA 19103
1-800-231-8002
<PAGE>
[LOGO OF DELAWARE POOLED
TRUST APPEARS HERE]
<PAGE>
[LOGO OF DELAWARE POOLED THE AGGRESSIVE GROWTH PORTFOLIO
TRUST APPEARS HERE]
AUDITED
ANNUAL
REPORT
October 31, 1994
<PAGE>
DELAWARE POOLED TRUST, INC--THE AGGRESSIVE GROWTH PORTFOLIO
The five interest rate increases that took place over the fiscal year
ended November 30, 1994 had a damaging effect on growth stocks. The Aggressive
Growth Portfolio provided a return of 0.34%* in what provided to be a very
challenging period for all stock investors, but particularly small and mid-cap
issues.
Though the small company growth sector was essentially out of favor with
the market over the course of the year, certain areas within the sector fared
better than others. We were pleased with the performance of our positions in
both the managed care segment of health care stocks and also in selected
computer and semi-conductor companies.
On the other hand, this was a difficult time for stocks in the
traditional consumer growth sector. While consumer confidence hit a four-year
high this summer, it never translated into strong consumer spending. Based on
the spending that did occur, we seem to be witnessing a secular move toward
spending on items with perceived long-term value and away from extravagant or
trendy items. This has caused growth stock investors to refocus. Over the past
year, we have been focusing on "value" retailers. We believe there is also
growth potential within convenience services. Some of the companies we're
currently looking at include discount retail, house and garden needs/maintenance
providers and restaurants.
Looking toward the future, we have begun to shift out of the managed care
companies that have been successful this year. Though these companies may
continue to prosper regardless of any legislative influences, their stocks have
reached valuation levels where we see only limited potential for price
appreciation. On the other hand, we continue to have strong expectations for
technology stocks, particularly those with international exposure, as European
economies continue to recover from recession.
There has been contraction in the valuations of the stocks in the growth
sector. We believe this has created opportunities. Not only can we acquire
stocks of companies we believe are strong at reduced prices, but when
price-to-earnings ratios are below normal in comparison to the S&P 500, as they
are now, growth stocks are considered relatively "cheap." Because growth stocks
are depressed at a time when much of the broader market is considered
overpriced, investors may now return to smaller company growth stocks, which
could push prices up.
<PAGE>
<TABLE>
<CAPTION>
Aggressive Growth Portfolio Wilshire Mid-Cap Growth
-----------------------------------------------------------
<S> <C> <C>
2/29/92 $10,000 $10,000
3/31/92 9,430 9,601
4/30/92 9,040 9,372
5/31/92 8,929 9,255
6/30/92 8,399 8,835
7/31/92 8,739 9,319
8/31/92 8,579 9,125
9/30/92 8,699 9,284
10/31/92 9,039 9,663
11/30/92 10,049 10,403
12/31/92 10,137 10,722
1/31/93 10,266 10,964
2/28/93 9,475 10,594
3/31/93 9,715 10,920
4/30/93 9,475 10,463
5/31/93 10,016 11,060
6/30/93 10,147 11,133
7/31/93 10,187 11,033
8/31/93 10,548 11,593
9/30/93 11,069 11,884
10/31/93 11,220 11,947
11/30/93 10,990 11,760
12/31/93 11,431 12,411
1/31/94 11,698 12,849
2/28/94 11,769 12,917
3/31/94 11,268 12,148
4/30/94 11,247 12,197
5/31/94 11,002 12,010
6/30/94 10,419 11,405
7/31/94 10,593 11,683
8/31/94 11,309 12,684
9/30/94 11,340 12,583
10/31/94 11,258 12,890
</TABLE>
The Aggressive
Growth Portfolio
Average Annual
Total Return*
through October 31, 1994
Lifetime...........4.52%
One Year............0.34%
A $10,000 investment in The Aggressive Growth Portfolio made at inception on
February 27, 1992 would have grown to $11,258 by October 31, 1994. The Wilshire
Mid-Cap Index, which includes stocks that are similar to those in The Aggressive
Growth Portfolio, would have grown to $12,890.
All dividends and capital gains have been reinvested for The Aggressive Growth
Portfolio and the Index. Past performance is not a guarantee of future results.
Return and share value will fluctuate so that shares, when redeemed, may be
worth more or less than the original investment. No adjustments have been made
for taxes.
*During this period, Delaware Management Company voluntarily agreed to waive its
fee and reimburse the Portfolio to the extent that annual operating expenses,
exclusive of taxes, interest, brokerage commissions and extraordinary expenses,
exceed .93% of average net assets. In the absence of the waiver, the portfolio's
total return would have been lower.
<PAGE>
Delaware Pooled Trust, Inc.-The Aggressive Growth Portfolio
Statement of Net Assets
October 31, 1994
<TABLE>
<CAPTION>
Number Market
of Shares Value
<S> <C> <C>
COMMON STOCK-82.48%
BASIC INDUSTRY/CAPITAL GOODS-2.64%
TriMas 15,800 $ 365,375
Wabash National 6,700 232,825
----------
Total Basic Industry/Capital Goods 598,200
----------
BUSINESS SERVICES-11.57%
Distributors-0.99%
Intelligent Electronics 14,400 223,200
----------
223,200
----------
Environmental-1.46%
Dames & Moore 22,400 330,400
----------
330,400
----------
Media & Publishing-2.94%
* International Family Entertainment Class B 9,700 127,313
* King World Productions 7,000 248,500
* Multimedia 9,900 290,813
----------
666,626
----------
Other Business Services-6.18%
* ADT Limited 21,000 236,250
* BISYS Group 19,100 420,200
First Financial Management 6,100 341,600
* Gartner Group 4,400 141,350
* Isomedix 14,000 259,000
----------
1,398,400
----------
Total Business Services 2,618,626
----------
CONSUMER DURABLES/CYCLICAL-1.55%
* Beazer Homes USA 3,900 46,800
* Redman Industries 15,000 256,875
* Schuler Homes 3,000 46,875
----------
Total Consumer Durables/Cyclical 350,550
----------
CONSUMER NON-DURABLES-11.20%
Retail-7.23%
Fingerhut 19,300 313,625
* General Nutrition 5,700 143,925
* Musicland Stores 19,500 265,688
* Price/Costco 16,800 263,550
Quality Food Centers 4,900 105,350
* Software Etc. Stores 9,400 96,350
* Staples 11,550 267,094
Talbots 1,500 52,125
* Value City Department Stores 11,400 129,675
----------
1,637,382
----------
</TABLE>
<PAGE>
Statement of Net Assets (Continued)
<TABLE>
<CAPTION>
Number Market
of Shares Value
<S> <C> <C>
COMMON STOCK (Continued)
CONSUMER NON-DURABLES (Continued)
Other Consumer Non-Durables-3.97%
Callaway Golf 5,600 $ 214,200
* Canandaigua Wine Class A 8,700 284,925
Hormel (George A.) 10,000 246,250
* Nature's Bounty 11,500 78,344
Topps 12,900 74,981
----------
898,700
----------
Total Consumer Non-Durables 2,536,082
----------
CONSUMER SERVICES-11.77%
Restaurants-3.32%
* Bertucci's 8,600 122,550
* Brinker International 11,900 275,188
* Foodmaker 20,000 107,500
* Lone Star Steakhouse/Saloon 8,500 217,813
Sbarro 1,200 29,850
----------
752,901
----------
Entertainment & Leisure-5.14%
* Circus Circus Enterprises 3,550 78,988
* Mirage Resorts 10,100 209,575
TCA Cable TV 2,100 49,350
* Viacom Class A 1,688 67,731
* Viacom Class B 12,789 501,968
* WMS Industries 14,500 255,563
----------
1,163,175
----------
Other Consumer Services-3.31%
Barefoot 17,100 241,538
Cash America Investments 20,200 166,650
* CUC International 10,600 340,525
----------
748,713
----------
Total Consumer Services 2,664,789
----------
ENERGY-1.48%
AES 9,348 188,128
Snyder Oil 8,500 146,625
----------
Total Energy 334,753
----------
FINANCIAL-6.01%
Insurance-5.49%
AMBAC 9,800 343,000
Blanch (E.W.) Holdings 14,100 287,288
CMAC Investment 14,400 396,000
MBIA 4,000 216,500
----------
1,242,788
----------
Other-0.52%
SEI 5,700 118,275
----------
118,275
----------
Total Financial 1,361,063
----------
HEALTH CARE-17.07%
Devices-0.76%
* Sunrise Medical 6,600 171,600
----------
171,600
----------
Pharmaceuticals-0.32%
* Techne 6,500 72,313
----------
72,313
----------
</TABLE>
<PAGE>
Statement of Net Assets (Continued)
<TABLE>
<CAPTION>
Number Market
of Shares Value
<S> <C> <C>
COMMON STOCK (Continued)
HEALTH CARE (Continued)
Services-13.01%
* Abbey Healthcare 3,500 $ 78,313
Columbia/HCA Healthcare 11,857 493,548
* Health Management Class A 22,650 588,900
* HEALTHSOUTH Rehabilitation 11,700 444,600
* Homedco Group 10,300 370,800
* NovaCare 9,600 96,000
* Quorum Health Group 2,000 45,750
* Value Health 11,964 463,605
* Vivra 12,900 364,425
-----------
2,945,941
-----------
Health Care-Other-2.98%
* FHP International 8,700 252,300
United Healthcare 8,000 422,000
-----------
674,300
-----------
Total Health Care 3,864,154
-----------
TECHNOLOGY-18.51%
Communications-1.97%
* Bay Networks 7,700 194,906
* Cabletron Systems 5,000 251,250
-----------
446,156
-----------
Hardware-8.41%
* Altera 3,100 122,256
* Clinicom 14,900 223,500
* Dallas Semiconductor 13,600 190,400
* Silicon Graphics 5,600 170,100
* Stratus Computer 8,200 305,450
* Xilinx 12,400 720,750
* Zilog 5,900 171,100
-----------
1,903,556
-----------
Software-8.13%
* BMC Software 6,100 277,550
* Compuware 12,400 485,150
HBO & Co. 1,634 53,309
* Informix 5,500 151,250
* Novell 21,900 403,781
Shared Medical Systems 3,400 100,513
* Viewlogic Systems 11,700 257,400
* Vmark Software 7,000 111,125
-----------
1,840,078
-----------
Total Technology 4,189,790
-----------
TRANSPORTATION-0.68%
Illinois Central 4,800 154,200
-----------
Total Transportation 154,200
-----------
Total Common Stock (cost $16,524,095) 18,672,207
-----------
STOCK RIGHTS-0.12%
* Viacom 21,100 27,694
-----------
Total Stock Rights (cost $24,925) 27,694
-----------
</TABLE>
<PAGE>
Statement of Net Assets (Continued)
<TABLE>
<CAPTION>
Principal Market
Amount Value
<S> <C> <C>
SHORT-TERM INVESTMENTS-8.81%
Federal Home Loan Bank Discount
Note 11/18/94 $2,000,000 $ 1,995,419
-----------
Total Short-Term Investments (cost $1,995,419) 1,995,419
-----------
REPURCHASE AGREEMENTS-10.87%
With Prudential Securities 4.76% 11/1/94
(dated 10/31/94, collateralized by
$2,551,000 U.S. Treasury Notes 4.625%
due 2/29/96, market value $2,511,121) 2,461,000 2,461,000
-----------
Total Repurchase Agreements (cost $2,461,000) 2,461,000
-----------
TOTAL MARKET VALUE OF SECURITIES-102.28%
(cost $21,005,439) 23,156,320
LIABILITIES NET OF RECEIVABLES AND OTHER
ASSETS-(2.28%) (516,597)
-----------
NET ASSETS APPLICABLE TO 2,055,747 SHARES ($.01 PAR VALUE)
OUTSTANDING; EQUIVALENT TO $11.01 PER SHARE-100.00% $22,639,723
===========
</TABLE>
----------------------------
*Non-income producing security for the year ended October 31, 1994.
See accompanying notes
<PAGE>
Delaware Pooled Trust, Inc.-The Aggressive Growth Portfolio
Statement of Operations
Year Ended October 31, 1994
<TABLE>
<S> <C> <C>
INVESTMENT INCOME:
Interest $160,144
Dividends 58,671 $218,815
--------
EXPENSES:
Management fees ($171,517) and Directors' fees ($2,813) 174,330
Custodian fees 30,727
Registration fees and organization expenses 15,462
Auditing 9,745
Salaries 6,412
Dividend disbursing and transfer agent fees and expenses 4,317
Taxes, other than taxes on income 2,244
Reports to shareholders 2,132
Other 9,873
--------
255,242
Less expenses absorbed by Delaware
Management Company, Inc. (52,540) 202,702
-------- ---------
NET INVESTMENT INCOME 16,113
---------
NET REALIZED GAIN AND UNREALIZED
LOSS ON INVESTMENTS:
Net realized gain from
security transactions 505,673
Net unrealized depreciation of
investments during the period (387,251)
---------
NET REALIZED AND UNREALIZED
GAIN ON INVESTMENTS 118,422
---------
NET INCREASE IN NET ASSETS RESULTING
FROM OPERATIONS $ 134,535
=========
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust, Inc.-The Aggressive Growth Portfolio
Statement of Changes in Net Assets
<TABLE>
<CAPTION>
Year Year
Ended Ended
10/31/94 10/31/93
<S> <C> <C>
OPERATIONS:
Net investment income $ 16,113 $ 32,734
Net realized gain on investments 505,673 445,307
Net unrealized appreciation (depreciation)
during the period (387,251) 2,941,476
----------- -----------
Net increase in net assets
resulting from operations 134,535 3,419,517
----------- -----------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (37,888) (8,536)
Net realized gain from security transactions (397,820) ---
----------- -----------
(435,708) (8,536)
----------- -----------
CAPITAL SHARE TRANSACTIONS:
Proceeds from shares sold 2,687,551 13,284,000
Net asset value of shares issued upon reinvestment
of dividends from net investment income 435,708 8,536
----------- -----------
3,123,259 13,292,536
Cost of shares repurchased (660,012) (763,942)
----------- -----------
Increase in net assets derived from
capital share transactions 2,463,247 12,528,594
----------- -----------
NET INCREASE IN NET ASSETS 2,162,074 15,939,575
NET ASSETS:
Beginning of period 20,477,649 4,538,074
----------- -----------
End of period (including undistributed
net investment income of $10,795 and $32,570,
respectively) $22,639,723 $20,477,649
=========== ===========
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust, Inc.-The Aggressive Growth Portfolio
Notes to Financial Statements
October 31, 1994
1. Significant Accounting Policies
Delaware Pooled Trust, Inc. (the "Fund") is a diversified, no load, open-end,
management investment company which is intended to meet a wide range of
investment objectives for large institutional clients with its seven separate
Portfolios. The Fund was organized under the laws of Maryland and is registered
under the Investment Company Act of 1940 (as amended). Each Portfolio
("Series") is in effect a separate fund issuing its own shares. As of October
31, 1994, only The Defensive Equity Portfolio, The Aggressive Growth Portfolio,
The International Equity Portfolio and The Global Fixed Income Portfolio had
commenced operations. The Fixed Income Portfolio, The Limited-Term Maturity
Portfolio and The International Fixed Income Portfolio had not commenced
operations except for the conduct of organizational matters.
Equity securities listed or traded on a national securities exchange are valued
at the closing price on the exchange where they are primarily traded.
Securities not traded on a particular day, over-the-counter securities and
government and agency securities are valued at the mean between bid and asked
prices. Money market instruments having a maturity of less than 60 days are
valued at amortized cost.
On October 31, 1994, 10.87% of the Series' 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 Series 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. 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.
Costs incurred in connection with the Fund's organization and registration are
paid by each Series and amortized on a straight line method. Registration costs
were amortized over a two-year period and organization expenses are being
amortized over a five-year period following the initial sale.
The Series received $21,000 from the initial subscribers to purchase 2,100
shares at net asset value prior to the initial public offering of the Series'
shares. In the event the initial subscribers redeem these shares during the
five-year period beginning with the date of initial sale, there will be deducted
from the redemption proceeds attributable to such shares the then unamortized
portion of the organization expenses attributable to these shares
2. Investment Management Fees and Other Transactions with Affiliates
Delaware Management Company, Inc., the investment adviser of the Series, will
receive a fee to be paid quarterly, which is computed on the net assets of the
Series as of the close of business each day at the annual rate of 0.80%, less
all amounts paid to the unaffiliated directors.
Delaware Management Company, Inc. has undertaken voluntarily to waive its fee
and reimburse the Aggressive Growth Portfolio to the extent that annual
operating expenses, exclusive of taxes, interest, brokerage commissions and
extraordinary expenses exceed 0.93% of average net assets through April 30,
1995. Total expenses absorbed by Delaware Management Company, Inc. for the year
ended October 31, 1994 was $52,540.
On October 31, 1994, the Series had an investment management fee payable to
Delaware Management Company, Inc. of $11,584.
<PAGE>
Notes to Financial Statements (Continued)
3. Investments
Investment securities based on cost for federal income tax purposes at October
31, 1994 are as follows:
<TABLE>
<S> <C>
Cost of investments $21,025,488
Aggregate unrealized appreciation 3,319,004
Aggregate unrealized depreciation (1,188,172)
-----------
Market value of investments $23,156,320
===========
</TABLE>
Net realized gain based on cost of specific certificate or bond for federal
income tax purposes was $488,242 for the year ended October 31, 1994.
During the year ended October 31, 1994, the Series had purchases of $8,655,449
and sales of $7,673,883 of investment securities other than U.S. government
securities and short-term debt securities having maturities of one year or less.
On October 31, 1994, the Series had a payable for investment securities
purchased of $692,923 and a receivable for investment securities sold of
$223,175.
4. Capital Stock
Transactions in capital stock shares were as follows:
<TABLE>
<CAPTION>
Year Year
Ended Ended
10/31/94 10/31/93
-------- --------
<S> <C> <C>
Shares sold 247,591 1,397,072
Shares issued upon reinvestment of dividends
from net investment income 39,147 844
Share repurchased (58,824) (72,183)
------- ---------
Net increase in shares 227,914 1,325,733
======= =========
</TABLE>
<PAGE>
Notes to Financial Statements (Continued)
<TABLE>
<S> <C>
5. Components of Net Assets
Common stock, $.01 par value, 500,000,000 shares
authorized to the Fund with 50,000,000 shares
allocated to this Series $20,012,841
Accumulated undistributed income:
Net investment income 10,795
Net realized gain on investments 465,206
Net unrealized appreciation of investments 2,150,881
-----------
Total net assets applicable to 2,055,747
shares of common stock; equivalent
to $11.01 per share $22,639,723
===========
</TABLE>
6. Financial Highlights
Selected data for each share of the Series outstanding throughout each period
were as follows:
<TABLE>
<CAPTION>
Year Year 2/27/92*
Ended Ended to
10/31/94 10/31/93 10/31/92
<S> <C> <C> <C>
Net asset value, beginning of period $ 11.2000 $ 9.0400 $ 10.0000
Income (loss) from investment operations:
Net investment income 0.0075 0.0181 0.0167
Net realized and unrealized gain
(loss) from security transactions 0.0325 2.1589 (0.9767)
--------- --------- ---------
Total from investment operations 0.0400 2.1770 (0.9600)
--------- --------- ---------
Less distributions:
Dividends from net investment income (0.0200) (0.0170) none
Distributions from net realized gain
on security transactions (0.2100) none none
--------- --------- ---------
Total distributions (0.2300) (0.0170) none
--------- --------- ---------
Net asset value, end of period $ 11.0100 $ 11.2000 $ 9.0400
========= ========= =========
Total return 0.34% 24.10% (13.89%)
Ratios/supplemental data:
Net assets, end of period (000 omitted) $ 22,640 $ 20,478 $ 4,538
Ratio of expenses to average net assets 0.93%+ 0.93%+ 0.93%+
Ratio of net investment income to
average net assets 0.07%++ 0.23%++ 0.28%++
Portfolio turnover 43% 81% 34%
</TABLE>
--------------------------
* Date of initial sale; ratios and total return have been annualized.
+ Ratio of expenses to average net assets prior to expense limitation was
1.17% for the year ended 10/31/94, 1.40% for the year ended 10/31/93 and
2.56% for the period from 2/27/92 to 10/31/92.
++ Ratio of net investment loss to average net assets prior to expense
limitation was (0.17%) for the year ended 10/31/94, (0.24%) for the year
ended 10/31/93 and (1.35%) for the period from 2/27/92 to 10/31/92.
<PAGE>
Delaware Pooled Trust, Inc.-The Aggressive Growth Portfolio
Report of Independent Auditors
To the Shareholders and Board of Directors
Delaware Pooled Trust, Inc.-The Aggressive Growth Portfolio
We have audited the accompanying statement of net assets of Delaware Pooled
Trust, Inc.-The Aggressive Growth Portfolio as of October 31, 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 two years in the period then ended and for
the period February 27, 1992 (date of initial sale) to October 31, 1992. 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
October 31, 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 Pooled Trust, Inc.-The Aggressive Growth Portfolio at October 31, 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 two years in the period then ended and the period
February 27, 1992 (date of initial sale) to October 31, 1992, in conformity with
general accepted accounting principles.
ERNST & YOUNG LLP
Philadelphia, PA
December 2, 1994
<PAGE>
DELAWARE POOLED TRUST
ONE COMMERCE SQUARE
2005 MARKET STREET
PHILADELPHIA, PA 19103
1-800-231-8002
<PAGE>
Delaware Pooled Trust,Inc.-The Fixed Income Portfolio
Statement of Assets and Liabilities
October 31, 1994
<TABLE>
<S> <C>
ASSETS:
Cash $ 21,000
Deferred organization and
registration expenses 33,176
--------
54,176
--------
LIABILITIES:
Accounts payable
and other accrued expenses 33,176
--------
33,176
--------
NET ASSETS APPLICABLE TO 2,100
SHARES OUTSTANDING; EQUIVALENT
TO $10.00 PER SHARE $ 21,000
========
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust,Inc.-The Fixed Income Portfolio
Notes to Financial Statements
October 31, 1994
1. Significant Accounting Policies
Delaware Pooled Trust, Inc. (the "Fund") is a diversified, no load, open-end
management investment company which is intended to meet a wide range of
investment objectives for large institutional clients with its seven separate
Portfolios. The Fund was organized under the laws of Maryland and is registered
under the Investment Company Act of 1940 (as amended). Each Portfolio
("Series") is in effect a separate fund issuing its own shares. As of October
31, 1994, only The Defensive Equity Portfolio, The Aggressive Growth Portfolio,
The International Equity Portfolio and The Global Fixed Income Portfolio had
commenced operations. The Limited-Term Maturity Portfolio, The Fixed Income
Portfolio and The International Fixed Income Portfolio had not commenced
operations except for the conduct of organizational matters. As a result, only
a statement of assets and liabilities has been shown for The Fixed Income
Portfolio.
Portfolio securities listed or traded on a national securities exchange, except
for bonds, are valued at the closing price on the exchange where they are
primarily traded. Securities not traded on a particular day, over-the-counter
securities and government and agency securities are valued at the mean 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 the pricing service has been approved by the Board of Directors. Prices
provided by the 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.
Other securities and those for which no quotations are available are valued at
fair value as determined in good faith and in a method approved by the Board of
Directors. No securities were valued on this basis in the accompanying
financial statements.
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. As
of October 31, 1994, no security transactions had occurred. Dividend income and
distributions to shareholders are recorded on the ex-dividend date. 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.
Costs incurred in connection with the Fund's organization and registration are
paid by each Series and amortized on a straight line method. Registration costs
are being amortized over a two-year period and organization expenses are being
amortized over a five-year period following the initial public offering.
The Series received $21,000 from the initial subscribers to purchase 2,100
shares at net asset value prior to the initial public offering of the Series'
shares. In the event the initial subscribers redeem these shares during the
five-year period beginning with the date of initial public offering, there will
be deducted from the redemption proceeds attributable to such shares the then
unamortized portion of the organization expenses attributable to these shares.
Such proration is to be calculated by dividing the number of shares to be
redeemed by the aggregate number of shares held by the initial subscribers
representing the initial capital. As of October 31, 1994, no other transactions
in capital stock shares had occurred.
2. Investment Management Fee and Other Transactions with Affiliates
In accordance with the terms of the Investment Advisory Agreement with the Fund
on behalf of The Fixed Income Portfolio, Delaware Management Company, Inc., the
investment adviser of the Series, will receive a fee to be paid quarterly, which
is computed on the net assets of the Series as of the close of business each day
at the annual rate of 0.40%, less all amounts paid to the unaffiliated
directors.
Delaware Management Company, Inc. has undertaken voluntarily to waive its fee
and reimburse the Series to the extent that annual operating expenses, exclusive
of taxes, interest, brokerage commissions and extraordinary expenses exceed
0.53% of average net assets.
3. Components of Net Assets
500,000,000 shares, $.01 par value, have been authorized to the Fund with
50,000,000 shares allocated to the Series. Total net assets applicable to 2,100
shares of common stock outstanding were $21,000, which is equivalent to $10.00
per share.
4. Financial Highlights
Selected data for each share of the Series outstanding throughout the period has
been omitted since the Series has not commenced operations.
<PAGE>
Delaware Pooled Trust,Inc.-The Fixed Income Portfolio
Report of Independent Auditors
To the Shareholders and Board of Directors
Delaware Pooled Trust,Inc.-The Fixed Income Portfolio
We have audited the accompanying statement of assets and liabilities of Delaware
Pooled Trust,Inc.-The Fixed Income Portfolio as of October 31, 1994. This
financial statement is the responsibility of the Fund's management. Our
responsibility is to express an opinion on this financial statement based on our
audit.
We conducted our audit 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 are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. 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 audit provides a reasonable basis for our opinion.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the financial position of Delaware Pooled Trust,Inc.-The
Fixed Income Portfolio at October 31, 1994, in conformity with general accepted
accounting principles.
ERNST & YOUNG LLP
Philadelphia, Pennsylvania
December 2, 1994
<PAGE>
Delaware Pooled Trust,Inc.-The Limited-Term Maturity Portfolio
Statement of Assets and Liabilities
October 31, 1994
<TABLE>
<S> <C>
ASSETS:
Cash $ 21,000
Deferred organization and
registration expenses 31,995
---------
52,995
---------
LIABILITIES:
Accounts payable
and other accrued expenses 31,995
---------
31,995
---------
NET ASSETS APPLICABLE TO 2,100
SHARES OUTSTANDING; EQUIVALENT
TO $10.00 PER SHARE $ 21,000
=========
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust,Inc.-The Limited-Term Maturity Portfolio
Notes to Financial Statements
October 31, 1994
1. Significant Accounting Policies
Delaware Pooled Trust, Inc. (the "Fund") is a diversified, no load, open-end
management investment company which is intended to meet a wide range of
investment objectives for large institutional clients with its seven separate
Portfolios. The Fund was organized under the laws of Maryland and is registered
under the Investment Company Act of 1940 (as amended). Each Portfolio
("Series") is in effect a separate fund issuing its own shares. As of October
31, 1994, only The Defensive Equity Portfolio, The Aggressive Growth Portfolio,
The International Equity Portfolio and The Global Fixed Income Portfolio had
commenced operations. The Limited-Term Maturity Portfolio, The Fixed Income
Portfolio and The International Fixed Income Portfolio had not commenced
operations except for the conduct of organizational matters. As a result, only
a statement of assets and liabilities has been shown for The Limited-Term
Maturity Portfolio.
Portfolio securities listed or traded on a national securities exchange, except
for bonds, are valued at the closing price on the exchange where they are
primarily traded. Securities not traded on a particular day, over-the-counter
securities and government and agency securities are valued at the mean 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 the pricing service has been approved by the Board of Directors. Prices
provided by the 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.
Other securities and those for which no quotations are available are valued at
fair value as determined in good faith and in a method approved by the Board of
Directors. No securities were valued on this basis in the accompanying
financial statements.
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. As
of October 31, 1994, no security transactions had occurred. Dividend income and
distributions to shareholders are recorded on the ex-dividend date. 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.
Costs incurred in connection with the Fund's organization and registration are
paid by each Series and amortized on a straight line method. Registration costs
are being amortized over a two-year period and organization expenses are being
amortized over a five-year period following the initial public offering.
The Series has received $21,000 from the initial subscribers to purchase 2,100
shares at net asset value prior to the initial public offering of the Series'
shares. In the event the initial subscribers redeem these shares during the
five-year period beginning with the date of initial public offering, there will
be deducted from the redemption proceeds attributable to such shares the then
unamortized portion of the organization expenses attributable to these shares.
Such proration is to be calculated by dividing the number of shares to be
redeemed by the aggregate number of shares held by the initial subscribers
representing the initial capital. As of October 31, 1994, no other transactions
in capital stock shares had occurred.
2. Investment Management Fee and Other Transactions with Affiliates
In accordance with the terms of the Investment Advisory Agreement with the Fund
on behalf of The Limited-Term Maturity Portfolio, Delaware Management Company,
Inc., the investment adviser of the Series, will receive a fee to be paid
quarterly, which is computed on the net assets of the Series as of the close of
business each day at the annual rate of 0.30%, less all amounts paid to the
unaffiliated directors.
Delaware Management Company, Inc. has undertaken voluntarily to waive its fee
and reimburse the Series to the extent that annual operating expenses, exclusive
of taxes, interest, brokerage commissions and extraordinary expenses exceed
0.43% of average net assets.
3. Components of Net Assets
500,000,000 shares, $.01 par value, have been authorized to the Fund with
50,000,000 shares allocated to the Series. Total net assets applicable to 2,100
shares of common stock outstanding were $21,000, which is equivalent to $10.00
per share.
4. Financial Highlights
Selected data for each share of the Series outstanding throughout the period has
been omitted since the Series has not commenced operations.
<PAGE>
Delaware Pooled Trust,Inc.-The Limited-Term Maturity Portfolio
Report of Independent Auditors
To the Shareholders and Board of Directors
Delaware Pooled Trust, Inc.-The Limited-Term Maturity Portfolio
We have audited the accompanying statement of assets and liabilities of Delaware
Pooled Trust, Inc.-The Limited-Term Maturity Portfolio as of October 31, 1994.
This financial statement is the responsibility of the Fund's management. Our
responsibility is to express an opinion on this financial statement based on our
audit.
We conducted our audit 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 are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. 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 audit provides a reasonable basis for our opinion.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the financial position of Delaware Pooled Trust, Inc.-The
Limited-Term Maturity Portfolio at October 31, 1994, in conformity with general
accepted accounting principles.
ERNST & YOUNG LLP
Philadelphia, Pennsylvania
December 2, 1994
<PAGE>
Delaware Pooled Trust,Inc.-The International Fixed Income Portfolio
Statement of Assets and Liabilities
October 31, 1994
<TABLE>
<S> <C>
ASSETS:
Deferred organization and
registration expenses $ 11,957
---------
11,957
---------
LIABILITIES:
Accounts payable
and other accrued expenses 11,957
---------
11,957
---------
NET ASSETS $ -0-
=========
</TABLE>
See accompanying notes
<PAGE>
Delaware Pooled Trust,Inc.-The International Fixed Income Portfolio
Notes to Financial Statements
October 31, 1994
1. Significant Accounting Policies
Delaware Pooled Trust, Inc. (the "Fund") is a diversified, no load, open-end
management investment company which is intended to meet a wide range of
investment objectives for large institutional clients with its seven separate
Portfolios. The Fund was organized under the laws of Maryland and is registered
under the Investment Company Act of 1940 (as amended). Each Portfolio
("Series") is in effect a separate fund issuing its own shares. As of October
31, 1994, only The Defensive Equity Portfolio, The Aggressive Growth Portfolio,
The International Equity Portfolio and The Global Fixed Income Portfolio had
commenced operations. The Limited-Term Maturity Portfolio, The Fixed Income
Portfolio and The International Fixed Income Portfolio had not commenced
operations except for the conduct of organizational matters. As a result, only
a statement of assets and liabilities has been shown for The International Fixed
Income Portfolio.
Portfolio securities listed or traded on a national securities exchange, except
for bonds, are valued at the closing 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 Series is valued. Securities
not traded on a particular day, over-the-counter securities and government and
agency securities are valued at the mean 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 the pricing
service has been approved by the Board of Directors. Prices provided by the
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. 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 as of 3:00 p.m. EST. 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. Other
securities and those for which no quotations are available are valued at fair
value as determined in good faith and in a method approved by the Board of
Directors. No securities were valued on this basis in the accompanying
financial statements.
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. As
of October 31, 1994, no security transactions had occurred. Dividend income and
distributions to shareholders are recorded on the ex-dividend date. Dividends
are recorded 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.
Costs incurred in connection with the Fund's organization and registration are
paid by each Series and amortized on a straight line method. Registration costs
are being amortized over a two-year period and organization expenses are being
amortized over a five-year period following the initial public offering.
2. Investment Management Fee and Other Transactions with Affiliates
In accordance with the terms of the Investment Advisory Agreement with the Fund
on behalf of The International Fixed Income Portfolio, Delaware International
Advisers Ltd., the investment adviser of the Series, will receive a fee to be
paid quarterly, which is computed on the net assets of the Series as of the
close of business each day at the annual rate of 0.50%, less all amounts paid to
the unaffiliated directors.
Delaware International Advisers Ltd, has undertaken voluntarily to waive its fee
and reimburse The International Fixed Income Portfolio to the extent that annual
operating expenses, exclusive of taxes, interest, brokerage commissions and
extraordinary expenses exceed 0.62% of average net assets.
3. Capital Stock
500,000,000 shares, $.01 par value, have been authorized to the Fund with
50,000,000 shares allocated to the Series. As of October 31, 1994 the
International Fixed Income Portfolio did not have any shares of common stock
outstanding.
4. Financial Highlights
Selected data for each share of the Series outstanding throughout the period has
been omitted since the Series has not commenced operations.
<PAGE>
Delaware Pooled Trust,Inc.-The International Fixed Income Portfolio
Report of Independent Auditors
To the Shareholders and Board of Directors
Delaware Pooled Trust,Inc.-The International Fixed Income Portfolio
We have audited the accompanying statement of assets and liabilities of Delaware
Pooled Trust,Inc.-The International Fixed Income Portfolio as of October 31,
1994. This financial statement is the responsibility of the Fund's management.
Our responsibility is to express an opinion on this financial statement based on
our audit.
We conducted our audit 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 are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. 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 audit provides a reasonable basis for our opinion.
In our opinion, the financial statement referred to above presents fairly, in
all material respects, the financial position of Delaware Pooled Trust,Inc.-The
International Fixed Income Portfolio at October 31, 1994, in conformity with
general accepted accounting principles.
ERNST & YOUNG LLP
Philadelphia, Pennsylvania
December 2, 1994
