DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS INC, 497, 1998-12-24

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS INC
497, 1998-12-24

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For more information contact Delaware
Investments at 800-510-4015. NEW EUROPE FUND
LATIN AMERICA FUND
________________________________

INSTITUTIONAL CLASS
________________________________

INVESTMENT MANAGER
Delaware International Advisers Ltd.
80 Cheapside
Third Floor
London, England EC2V 6EE

NATIONAL DISTRIBUTOR P R O S P E C T U S
Delaware Distributors, L.P. ________________________________
1818 Market Street
Philadelphia, PA 19103 DECEMBER 23, 1998

SHAREHOLDER SERVICING,
DIVIDEND DISBURSING,
ACCOUNTING SERVICES
AND TRANSFER AGENT
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103

LEGAL COUNSEL
Stradley, Ronon, Stevens & Young, LLP
One Commerce Square
Philadelphia, PA 19103

INDEPENDENT AUDITORS
Ernst & Young LLP
Two Commerce Square
Philadelphia, PA 19103

CUSTODIAN
The Chase Manhattan Bank [GRAPHIC OMITTED]
4 Chase Metrotech Center
Brooklyn, NY 11245

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NEW EUROPE FUND PROSPECTUS
LATIN AMERICA FUND DECEMBER 23, 1998

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

1818 Market Street, Philadelphia, PA 19103

For more information about New Europe Fund
Institutional Class and Latin America Fund Institutional Class
call Delaware Investments at 800-510-4015

This Prospectus describes shares of the New Europe and Latin America
Series (individually, a "Fund" and collectively, the "Funds") of Delaware Group
Global & International Funds, Inc. ("Global Funds, Inc."), both of which are
professionally-managed mutual funds of the series type.

The investment objective of each Fund is to achieve long-term capital
appreciation. The New Europe Fund ("New Europe") seeks to achieve its objective
by investing primarily in equity securities of European companies. The Latin
America Fund ("Latin America") seeks to achieve its objective by investing
primarily in equity securities of Latin American companies. Certain of the
European and Latin American markets may be considered to be developing or
emerging markets, and investments in such markets are generally considered to
present greater risks than investments in more developed markets. See Investment
Objectives and Strategies and Special Risk Considerations.

The Funds offer an Institutional Class of shares (the "Class"). This
Prospectus relates only to the Class and sets forth information that you should
read and consider before you invest. Please retain it for future reference. The
Funds' Statement of Additional Information ("Part B" of Global Funds, Inc.'s
registration statement), dated December 23, 1998, as it may be amended from time
to time, contains additional information about the Funds and has been filed with
the Securities and Exchange Commission (the "SEC"). Part B is incorporated by
reference into this Prospectus and is available, without charge, by writing to
Delaware Distributors, L.P. at the above address or by calling the above number.
The Funds' financial statements will appear in the Annual Report of Global
Funds, Inc. and will accompany any response to requests for Part B. In addition,
the SEC maintains a Web site (http://www.sec.gov) that contains Part B, material
included by reference into Global Funds, Inc.'s registration statement, and
other information regarding registrants that electronically file with the SEC.

Each Fund also offers Class A Shares, Class B Shares and Class C
Shares. Shares of these classes are subject to sales charges and other expenses,
which may affect their performance. A prospectus for these classes can be
obtained by writing to Delaware Distributors, L.P. at the above address or by
calling 800-523-1918.

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TABLE OF CONTENTS

<TABLE>
<CAPTION>
<S> <C> <C>
Page Page
Cover Page How to Buy Shares
Synopsis Redemption and Exchange
Summary of Expenses Dividends and Distributions
Investment Objectives and Strategies Taxes
Suitability Calculation of Offering Price and
Investment Strategy Net Asset Value Per Share
Special Risk Considerations Management of the Funds
The Delaware Difference Other Investment Policies and
Plans and Services Risk Considerations
Classes of Shares Appendix A - Ratings
</TABLE>

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION, NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

BE SURE TO CONSULT YOUR FINANCIAL ADVISER WHEN MAKING INVESTMENTS. MUTUAL FUNDS
CAN BE A VALUABLE PART OF YOUR FINANCIAL PLAN; HOWEVER, SHARES OF THE FUNDS ARE
NOT FDIC OR NCUSIF INSURED, ARE NOT GUARANTEED BY ANY BANK OR ANY CREDIT UNION,
ARE NOT OBLIGATIONS OF ANY BANK OR ANY CREDIT UNION, AND INVOLVE INVESTMENT
RISK, INCLUDING THE POSSIBLE LOSS OF THE PRINCIPAL AMOUNT INVESTED. SHARES OF
THE FUNDS ARE NOT BANK OR CREDIT UNION DEPOSITS.

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SYNOPSIS

Investment Objectives
The investment objective of each Fund is to achieve long-term capital
appreciation. New Europe seeks to achieve its objective by investing primarily
in equity securities of European countries. Latin America seeks to achieve its
objective by investing primarily in equity securities of Latin American
companies.

New Europe and Latin America are international funds. Under normal
market conditions, at least 65% of New Europe's assets will be invested in
equity securities of companies organized or having a majority of their assets in
or deriving a majority of their operating income in Europe. Under normal market
conditions, at least 65% of Latin America's assets will be invested in equity
securities of companies organized or having a majority of their assets in or
deriving a majority of their operating income in Latin America. For further
details, see Investment Objectives and Strategies and Other Investment Policies
and Risk Considerations.

Risk Factors and Special Considerations
Prospective investors should consider a number of factors:

1. Investing in securities of non-United States companies, which are
generally denominated in foreign currencies, and the utilization of forward
foreign currency exchange contracts involve certain risk and opportunity
considerations not typically associated with investing in United States
companies. See Special Risk Considerations-Foreign Securities Risks and Other
Investment Policies and Risk Considerations.

2. Each Fund may invest a portion of its assets in the markets of
certain emerging countries. Investments in securities of companies in emerging
markets present a greater degree of risk than tends to be the case for foreign
investments in Western Europe and other developed markets. Among other things,
economic markets and structures tend to be less mature and diverse and the
securities markets, which are subject to less government regulation or
supervision, may also be smaller, less liquid and subject to greater price
volatility. There is a greater possibility of expropriation, nationalization,
confiscatory taxation, income earned or other special taxes, foreign exchange
restrictions, limitations on the repatriation of income and capital from
investments, defaults in foreign government debt, and economic, political or
social instability. In addition, in many emerging markets, there is
substantially less publicly available information about issuers and the
information that is available tends to be of a lesser quality. These risks are
accentuated for both Funds because many of the countries in Eastern Europe and
most of the countries in Latin America are emerging market countries. See
Special Risk Considerations-Emerging Markets Securities Risks.

3. The New Europe and Latin America Funds target specific regions of
the world for investment. Thus, an investment in either of these Funds will
likely be more volatile than a more geographically diversified fund. Further,
the performance of either Fund is closely tied to the economic and political
conditions of the regions in which it invests. See Special Risk Considerations -
Region Risks.

4. The prices of certain equity securities in which New Europe and
Latin America may invest, may tend to fluctuate, particularly in the shorter
term. Investors in the Funds should be willing to accept the risks associated
with smaller sized companies, some of the securities of which may be speculative
and subject the Funds to additional investment risk. See Special Risk
Considerations and Other Investment Policies and Risk Considerations.

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5. Each Fund may invest up to 30% of its assets, in high yield, high
risk foreign fixed-income securities, including Brady Bonds. Consequently,
greater risks may be involved with an investment in the Funds. See High Yield,
High Risk Securities under Investment Objective and Strategies.

6. The Funds have the right to engage in options and futures
transactions for hedging purposes, to counterbalance portfolio volatility. In
connection with futures transactions, the Funds will maintain certain collateral
in special accounts established with futures commission merchants or on its
behalf in the care of The Chase Manhattan Bank (the "Custodian Bank"). While the
Funds do not engage in options and futures for speculative purposes, there are
risks which result from the use of these instruments, and an investor should
carefully review the descriptions of these risks in this Prospectus. See Options
and Futures Contracts and Options on Futures Contracts under Other Investment
Policies and Risk Considerations.

Investment Manager, Distributor and Service Agent
Delaware International Advisers Ltd. ("Delaware International" or the
"Manager") furnishes investment management services to the Funds, subject to the
supervision of Global Funds, Inc.'s Board of Directors. Delaware Distributors,
L.P. (the "Distributor") is the national distributor for the Funds and for all
of the other mutual funds that are part of Delaware Investments. Delaware
Service Company, Inc. (the "Transfer Agent") is the shareholder servicing,
dividend disbursing, accounting services and transfer agent for the Funds and
for all of the other mutual funds that are part of Delaware Investments. See
Summary of Expenses and Management of the Fund for further information regarding
the Manager and the fees payable under the Fund's Investment Management
Agreements.

Purchase Price
Shares of the Class offered by this Prospectus are available at net
asset value, without a front-end or contingent deferred sales charge and are not
subject to distribution fees under a Rule 12b-1 distribution plan.

Redemption and Exchange
Shares of the Class are redeemed or exchanged at the net asset value
calculated after receipt of the redemption or exchange request. See Redemption
and Exchange.

Open-End Investment Company
Global Funds, Inc. is an open-end, registered management investment
company. Each Fund operates as a diversified fund as defined under the
Investment Company Act of 1940 (the "1940 Act"). Global Funds, Inc. was
organized as a Maryland corporation on May 30, 1991. See Shares under Management
of the Funds.

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SUMMARY OF EXPENSES

A general comparison of the sales arrangements and other expenses
applicable to the Class of Shares for each Fund follows:

New Europe Latin America
Shareholder Transaction Expenses Institutional Class Institutional Class
- ----------------------------------------------------- ------------------------------ -------------------------
<S> <C> <C>
Maximum Sales Charge Imposed on Purchases
(as a percentage of offering price).................. None None

Maximum Sales Charge Imposed on Reinvested
Dividends (as a percentage of offering price)........ None None

Exchange Fees........................................ None(1) None(1)

Annual Operating Expenses New Europe Latin America
(as a percentage of average daily net assets) Institutional Class Institutional Class
- ----------------------------------------------------- ----------------------------- -------------------------

Management Fees (after voluntary waivers)............ 0.00%(2) 0.00%(2)

12b-1 Expenses (including service fees)
(after voluntary waivers)............................ None None

Other Operating Expenses (after voluntary payments).. 1.25%(2) 1.25%(2)
==== ====

Total Operating Expenses
(after voluntary waivers and payments)............... 1.25%(2) 1.25%(2)
==== ====
</TABLE>

(1) Exchanges are subject to the requirements of each Fund and a front-end
sales charge may apply.
(2) Because the New Europe and Latin America Funds are new Funds, "Total
Operating Expenses" and "Other Operating Expenses" for each Class of each
Fund are based on estimated amounts each Fund expects to pay during the
initial fiscal year. The Manager has elected voluntarily to waive that
portion, if any, of the annual management fees payable by each Fund and to
pay certain expenses of the Funds to the extent necessary to ensure that
each Fund's Total Operating Expenses (exclusive of taxes, interest,
brokerage commissions and extraordinary expenses) do not exceed, on an
annualized basis, 1.25% of the average daily net assets of each Fund. The
Manager's voluntary fee waivers and expense payments began at the
commencement of the public offering of the Classes and will extend through
May 31, 1999. Absent the Manager's voluntary fee waiver and expense
payments, it is estimated that during the current fiscal year, the Total
Operating Expenses, as a percentage of average daily net assets, would be
1.95% for New Europe Fund Institutional Class and 2.02% for Latin America
Institutional Class, reflecting "Management Fees" of 1.25%.

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For expense information about each Fund's Class A, Class B and Class C
Shares, see the separate prospectus relating to those classes.

The following example illustrates the expenses that an investor would
pay on a $1,000 investment over various time periods, assuming (1) a 5% annual
rate of return, and (2) redemption at the end of each time period. Each Fund
does not charge a redemption fee. The following example also reflects the
voluntary waiver of the management fee and other payment of expenses by the
Manager, as discussed in this Prospectus.

1 year 3 years
------ -------
New Europe Institutional Fund $13 $40

Latin America Institutional Fund $13 $40

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.

The purpose of the above tables is to assist the investor in
understanding the various costs and expenses that an investor in the Class will
bear directly or indirectly.

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INVESTMENT OBJECTIVES AND STRATEGIES

SUITABILITY
Investors considering either Fund should have a long-term investment
time frame.

The Funds cannot assure a specific rate of return or that principal
will be protected. The value of the Funds' shares can be expected to move up and
down depending on market conditions. Consequently, appreciation may be obtained
in periods of generally rising markets, while in declining markets the value of
the Funds' shares may decline.

Investments in foreign securities, whether equity or fixed-income,
involve special risks including those related to currency fluctuations, as well
as to political, economic and social situations different from and potentially
more volatile than those in the United States. In addition, the accounting, tax
and financial reporting standards of foreign countries are different from and
may be less reliable or comprehensive than those relating to U.S. securities
issuers. See Special Risk Considerations for a complete discussion of the risk
factors affecting any international investment. For these reasons, the Funds are
not suitable for short-term investors. However, through the cautious selection
and supervision of its portfolio, the Manager will strive to achieve the Funds'
respective objectives.

The Funds may be suitable for investors with a long-term investment
horizon who are looking for long-term growth potential from a portfolio of
European or Latin American securities. New Europe will invest primarily in
equity securities of European countries of varying size. Latin America will
invest primarily in equity securities of Latin American companies. Investors
should be willing to accept the risks associated with foreign investing as well
as with investments in smaller-sized issuers, some of which may be speculative
and subject the Funds to additional investment risk.

* * *

Ownership of shares of the Funds can reduce the bookkeeping and
administrative inconvenience that is typically connected with direct purchases
of the type of securities in which the Funds invest.

An investor should not consider a purchase of shares of any Fund as
equivalent to a complete investment program. Delaware Investments includes a
family of funds, generally available through registered investment dealers,
which may be used together to create a more complete investment program.

INVESTMENT STRATEGY
New Europe - The investment objective of New Europe is to achieve
long-term capital appreciation. The Fund seeks to achieve its objective by
investing primarily in equity securities of European companies, which may
include companies located or operating in established or emerging European
countries. Under normal circumstances, at least 65% of the Fund's total assets
will be invested in equity securities of companies organized or having a
majority of their assets in or deriving a majority of their operating income in
Europe. The companies in which the Fund will invest will be of varying size.

The equity securities in which the Fund may invest include common
stocks, preferred stocks, rights or warrants to purchase common stocks and
securities convertible into common stocks. The Fund may also invest in foreign
companies through sponsored or unsponsored Depositary Receipts.

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The Fund may invest in securities of issuers located in any European
country where the Manager believes that there is the potential for long-term
capital appreciation. The Fund may invest in the securities of issuers located
in European countries with well-established economies and securities markets or
in countries with emerging economies or securities markets or smaller securities
markets. In addition, if opportunities arise, the Fund may invest in securities
of issuers located in Eastern European countries. See Special Risk
Considerations - Emerging Markets Securities Risks.

Latin America - The investment objective of Latin America is to achieve
long-term capital appreciation. The Fund seeks to achieve its objective by
investing primarily in equity securities of companies in Latin America, most of
which are emerging market countries. Under normal circumstances, at least 65% of
the Fund's total assets will be invested in equity securities of companies
organized or having a majority of their assets in or deriving a majority of
their income in Latin America. The companies in which the Fund will invest will
be of varying size.

The Latin American countries in which the Fund may invest include
Argentina, Belize, Bolivia, Brazil, Chile, Columbia, Costa Rica, Cuba, Ecuador,
El Salvador, French Guyana, Guatemala, Guyana, Honduras, Mexico, Nicaragua,
Panama, Paraguay, Peru, Surinam, Trinidad/Tobago, Uruguay and Venezuela.

Both Funds -- In selecting investments for the Funds, the Manager will
employ a dividend discount analysis across country boundaries and will also use
a purchasing power parity approach to identify currencies and markets that are
overvalued or undervalued relative to the U.S. dollar. The Manager uses the
dividend discount analysis, based on available information, to compare the value
of different investments. Using this technique, the Manager looks at future
anticipated dividends and discounts the value of those dividends back to what
they would be worth if they were being paid today. Because many of the countries
in which the Funds invest are emerging countries, there may be less information
available on which the Manager can base its dividend discount analysis. Thus,
such analysis may not be as complete as a dividend discount analysis performed
on investments in developed countries.

With a purchasing parity approach, the Manager attempts to identify the
amount of goods and services that a dollar will buy in the United States and
compare that to the amount of a foreign currency required to buy the same amount
of goods and services in another country. 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. When the dollar buys less,
the foreign currency may be considered to be overvalued. When the dollar buys
more, the currency may be considered to be undervalued.

The Funds may invest in both open-end and listed or unlisted closed-end
investment companies, as well as unregistered investment companies. See
Investment Company Securities under Other Investment Policies and Risk
Considerations. The Funds may also invest in convertible preferred stocks that
offer enhanced yield features, such as Preferred Equity Redemption Cumulative
Stock, and certain other non-traditional equity securities.

Each Fund may invest up to 30% of its net assets in fixed-income
securities issued by emerging country companies, and foreign governments, their
agencies, instrumentalities or political subdivisions, all of which may

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be high yield, high risk fixed-income securities rated lower than BBB by
Standard & Poor's Ratings Group ("S&P") and Baa by Moody's Investors Services,
Inc. ("Moody's") or, if unrated, are considered by the Manager to be of
equivalent quality and which present special investment risks. Each Fund may
also invest in Brady Bonds. See High Yield, High Risk Securities and Special
Risk Considerations.

For temporary defensive purposes, the Funds may invest all or a
substantial portion of their assets in high quality debt instruments issued by
foreign governments, their agencies, instrumentalities or political
subdivisions, supernational organizations, the U.S. government, its agencies or
instrumentalities (and which are backed by the full faith and credit of the U.S.
government), or issued by foreign or U.S. companies. For example, any Fund may
invest in U.S. fixed-income markets when the Manager believes that the global
equity markets are excessively volatile or overvalued so that the Fund's
objective cannot be achieved in such markets. Any such corporate debt
obligations will be rated AA or better by S&P, or Aa or better by Moody's, or if
unrated, will be determined to be of comparable quality by the Manager. The
Funds may also invest in the securities listed above pending investment of
proceeds from new sales of Fund shares and to maintain sufficient cash to meet
redemption requests.

Restricted and Illiquid Securities
The Funds 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 (the "1933 Act"). Rule 144A
permits many privately placed and legally restricted securities to be freely
traded among certain institutional buyers, such as the Funds. See Rule 144A
Securities under Other Investment Policies and Risk Considerations. Each Fund
may each invest up to 15% of the value of its net assets in illiquid securities,
which are securities which may not be disposed of in the ordinary course of
business within seven days at approximately the value at which the Fund has
valued the investment. In the event a Fund's percentage limitation is exceeded,
whether due to changes in the market value of the Fund's illiquid holdings or
because a particular security is deemed to have become illiquid, the Manager
will take steps to remedy these circumstances in an orderly fashion.

High Yield, High Risk Securities
Each Fund may invest up to 30% of its net assets in high yield, high
risk foreign fixed-income securities, including so-called Brady Bonds. See
Foreign Government Securities Risks under Special Risk Considerations. In the
past, in the opinion of the Manager, 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 Manager intends to maintain an adequately diversified portfolio of
stocks and bonds. While diversification can help to reduce the effect of an
individual default on a Fund, there can be no assurance that diversification
will protect a Fund from widespread bond defaults brought about by a sustained
economic downturn.

Medium- and low-grade bonds held by a Fund 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

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downturn or a 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
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 a Fund's net asset value per share.

* * *

Each Fund may invest in securities issued in any currency and may hold
foreign currency. Securities of issuers within a given country may be
denominated in the currency of another country or in multinational currency
units such as the Euro. For purposes of the 1940 Act, each Fund will operate as
a diversified fund. The Funds will not concentrate their investments in any
particular industry, which means that each Fund will not invest 25% or more of
its total assets in any one industry.

Global Funds, Inc.'s designation as an open-end investment company,
each Fund's designation as a diversified fund, and each Fund's policies
concerning portfolio lending, borrowing and concentration are "fundamental" and
may not be changed unless authorized by the vote of a majority of such Fund's
outstanding voting securities. A vote of a "majority of the outstanding voting
securities" is the vote by the holders of the lesser of a) 67% or more of a
Fund's voting securities present in person or represented by proxy if the
holders of more than 50% of the outstanding voting securities of the Fund are
present or represented by proxy; or b) more than 50% of the outstanding voting
securities. Part B lists other more specific investment restrictions of each
Fund which may not be changed without a majority shareholder vote.

Any investment policies of a Fund not identified above as "fundamental"
may be changed by the Board of Directors of Global Funds, Inc. without a
shareholder vote. See Special Risk Considerations and Other Investment Policies
and Risk Considerations.

SPECIAL RISK CONSIDERATIONS
Shareholders should understand that all investments involve risk and
there can be no guarantee against loss resulting from an investment in a Fund,
nor can there be any assurance that a Fund's investment objective will be
attained.

Foreign Securities Risks. The Funds have the right to purchase
securities in any developed, underdeveloped or emerging country. Investors
should consider carefully the substantial risks involved in investing in
securities issued by companies and governments of foreign nations. These risks
are in addition to the usual risks inherent in domestic investments. There is
the possibility of expropriation, nationalization or confiscatory taxation,
taxation of income earned in foreign nations or other taxes imposed with respect
to investments in foreign nations, foreign exchange control (which may include
suspension of the ability to transfer currency from a given country), default in
foreign government securities, political or social instability or diplomatic
developments which could affect investments in securities of issuers in those
nations.

In addition, in many countries, there is substantially less publicly
available information about issuers than is available in reports about companies
in the United States. Foreign companies are not subject to uniform accounting,
auditing and financial reporting standards, and auditing practices and
requirements may not be

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comparable to those applicable to United States companies. In particular, the
assets and profits appearing on the financial statements of a developing or
emerging country issuer may not reflect its financial position or results of
operations in the way they would be reflected had the financial statements been
prepared in accordance with the United States' generally accepted accounting
principles. Also, for an issuer that keeps accounting records in local currency,
inflation accounting rules may require for both tax and accounting purposes,
that certain assets and liabilities be restated on the issuer's balance sheet in
order to express items in terms of currency or constant purchasing power.
Inflation accounting may indirectly generate losses or profits. Consequently,
financial data may be materially affected by restatements for inflation and may
not accurately reflect the real condition of those issuers and securities
markets.

Further, the Funds may encounter difficulty or be unable to pursue
legal remedies and obtain judgments in foreign courts. Commission rates on
securities transactions in foreign countries, which are sometimes fixed rather
than subject to negotiation as in the United States, are likely to be higher.
Further, the settlement period of securities transactions in foreign markets may
be longer than in domestic markets, and may be subject to administrative
uncertainties. In many foreign countries, there is less government supervision
and regulation of business and industry practices, stock exchanges, brokers and
listed companies than in the United States, and capital requirements for
brokerage firms are generally lower. The foreign securities markets of many of
the countries in which the Funds may invest may also be smaller, less liquid and
subject to greater price volatility than those in the United States.

Emerging Markets Securities Risks. Compared to the United States and
other developed countries, emerging countries may have volatile social
conditions, relatively unstable governments and political systems, economies
based on only a few industries and economic structures that are less diverse and
mature, and securities markets that trade a small number of securities, which
can result in a low or nonexistent volume of trading. Prices in these securities
markets 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. Until recently, there has been an
absence of a capital market structure or market-oriented economy in certain
emerging countries. Further, investments and opportunities for investments by
foreign investors are subject to a variety of national policies and restrictions
in many emerging countries. These restrictions may take the form of prior
governmental approval, limits on the amount or type of securities held by
foreigners, limits on the types of companies in which foreigners may invest and
prohibitions on foreign investments in issuers or industries deemed sensitive to
national interests. Additional restrictions may be imposed at any time by these
or other countries in which the Funds invest. Also, 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 governmental consents. Countries such as those in which the Funds may
invest have historically experienced and may continue to experience,
substantial, and in some periods extremely high rates of inflation for many
years, high interest rates, exchange rate fluctuations or currency depreciation,
large amounts of external debt, balance of payments and trade difficulties and
extreme poverty and unemployment. Other factors which may influence the ability
or willingness to service debt include, but are not limited to, a country's cash
flow situation, the availability of sufficient foreign exchange on the date a
payment is due, the relative size of its debt service burden to the economy as a
whole, its government's policy towards the International Monetary Fund, the
World Bank and other international agencies and the political constraints to
which a government debtor may be subject.

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Latin America Fund, virtually all Latin American countries are underdeveloped or
emerging. Set forth below are some specific risk factors related to Eastern
Europe and Latin American issuers.

Eastern European Securities Risks. Investments in Eastern European
countries may involve particular risks with respect to nationalization,
expropriation and confiscatory taxation. The communist governments of a number
of Eastern European countries expropriated large amounts of private property in
the past, in many cases without adequate compensation, and there can be no
assurance that such expropriation will not occur in the future. In the event of
such expropriation, the New Europe Fund could lose a substantial portion of any
investments it has made in the affected countries. In addition, the accounting,
tax and financial reporting standards of Eastern European Countries are
different from and may be less reliable or comprehensive than those relating to
Western European securities. Finally, even though certain Eastern European
currencies may be convertible in to U.S. dollars, the conversion rates may be
artificial relative to the actual market values and may be unfavorable to Fund
investors.

Certain Eastern European countries, which do not have market economies,
are characterized by an absence of developed legal structures governing private
and foreign investments and private property. Certain countries require
governmental approval prior to investments by foreign persons, or limit the
amount of investment by foreign persons in a particular company or limit the
investment of foreign persons to only a specific class of securities of a
company that may have less advantageous terms than securities of the company
available for purchase by nationals.

Authoritarian governments in certain Eastern European countries may
require that a governmental or quasi-governmental authority act as custodian of
the New Europe Fund's assets invested in such country. To the extent such
governmental or quasi-governmental authorities do not satisfy the requirements
of the 1940 Act to act as foreign custodians of the New Europe Fund's cash and
securities, the Fund's investment in such countries may be limited or may be
required to be effected through intermediaries. The risk of loss through
governmental confiscation may be increased in such countries. The New Europe
Fund may also invest in Russian securities. Russian securities involve
additional significant risks, including political and social uncertainty (for
example, regional conflicts and risk of war), currency exchange rate volatility,
pervasiveness of corruption and crime in the Russian economic system, delays in
settling portfolio transactions and risk of loss arising out of Russia's system
of share registration and custody. For more information about these and other
risks associated with Russian securities, please see Part B.

Satisfactory custodial services for investment securities may not be
available in some Eastern European countries, which may result in the Fund
incurring additional costs and delays in transporting and custodying such
securities outside such countries.

Latin American Securities Risks. The Latin American securities markets
are not as large as the U.S. securities markets and have substantially less
trading volume, resulting in a lack of liquidity and high price volatility.
There is also a high concentration of market capitalization and trading volume
in a small number of issuers representing a limited number of industries, as
well as a high concentration of investors and financial intermediaries. Latin
American brokers typically are fewer in number and less capitalized than brokers
in the United States. These factors, combined with the U.S. regulatory
requirements for open-end funds and the restrictions on foreign investments
discussed below, result in potentially fewer investment opportunities for the
Latin America Fund and may have an adverse impact on the investment performance
of the Fund.

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<PAGE>

The investment objective of the Latin America Fund reflects the belief
that investment opportunities may result in Latin America from an evolving
long-term international trend encouraging greater market orientation and
diminishing governmental intervention in economic affairs. The Latin American
economies have experienced considerable difficulties in the past decade.
Although there have been significant improvements in recent years, the Latin
American economies continue to experience significant problems, including high
inflation rates and high interest rates. The emergence of the Latin American
economies and securities markets will require continued economic and fiscal
discipline which has been lacking at times in the past, as well as stable
political and social conditions. Recovery may also be influenced by
international economic conditions, particularly those in the United States, and
by world prices for oil and other commodities. There is no assurance that the
economic initiatives will be successful.

Certain of the risks associated with international investments and
investing in smaller capital markets are heightened for investments in Latin
American countries. For example, some of the currencies of Latin American
countries have experienced steady currency devaluations relative to the U.S.
dollar, and major adjustments have been made in certain of such currencies
periodically. In addition, governments of many Latin American countries have
exercised and continue to exercise substantial influence over many aspects of
the private sector. In certain cases, the government owns or controls many
companies, including the largest in the country. Accordingly, government actions
in the future could have a significant effect on economic conditions in Latin
American countries, which could affect private sector companies and the Fund, as
well as the value of securities in the Fund's portfolio.

In addition to the relative lack of publicly available information
about Latin American issuers and the possibility that such issuers may not be
subject to the same accounting, auditing and financial reporting standards as
are applicable to U.S. companies, inflation accounting rules in some Latin
American countries require, for companies that keep accounting records in the
local currency, for both tax and accounting purposes, that certain assets and
liabilities be restated on the company's balance sheet in order to express items
in terms of currency of constant purchasing power. Inflation accounting may
indirectly generate losses or profits for certain Latin American companies.

Satisfactory custodial services for investment securities may not be
available in some Latin American countries, which may result in the Fund
incurring additional costs and delays in transporting and custodying such
securities outside such countries.

Most Latin American countries have experienced substantial, and in some
periods extremely high, rates of inflation for many years. Inflation and rapid
fluctuations in inflation rates have had and may continue to have very negative
effects on the economies and securities markets of certain Latin American
countries.

As a result, management of the Fund may determine that, notwithstanding
otherwise favorable investment criteria, it may not be practicable or
appropriate to invest in a particular Latin American country. The Fund may
invest in countries in which foreign investors, including management of the
Fund, have had no or limited prior experience.

Some Latin American countries prohibit or impose substantial
restrictions on investments in their capital markets, particularly their equity
markets, by foreign entities such as the Fund. As illustrations, certain
countries may require governmental approval prior to investments by foreign
persons or limit the amount of investment by foreign persons in a particular
company or limit the investment by foreign persons to only a specific class of
securities of a company which may have less advantageous terms than securities
of the

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<PAGE>

company available for purchase by nationals. Certain countries may
restrict investment opportunities in issuers or industries deemed important to
national interests.

Substantial limitations may exist in certain countries with respect to
the Fund's ability to repatriate investment income, capital or the proceeds of
sales of securities by foreign investors. For example, in Chile, with limited
exceptions, invested capital cannot be repatriated for three years. The Latin
America Fund could be adversely affected by delays in, or a refusal to grant,
any required governmental approval for repatriation of capital, as well as by
the application to the Fund of any restrictions on investments.

In some Latin American countries, such as Argentina, banks or other
financial institutions may constitute a substantial number of the leading
companies or the companies with the most actively traded securities. The
Investment Company Act restricts the Latin America Fund's investments in any
equity security of an issuer which, in its most recent fiscal year, derived more
than 15% of its revenues from "securities related activities," as defined by the
rules thereunder. These provisions may restrict the Fund's investments in
certain foreign banks and other financial institutions.

Foreign Government Securities Risks. With respect to investment in debt
issues of foreign governments, the ability of a foreign government or
government-related issuer to make timely and ultimate payments on its external
debt obligations will also be strongly influenced by the issuer's balance of
payments, including export performance, its access to international credits and
investments, fluctuations in interest rates and the extent of its foreign
reserves. A country whose exports are concentrated in a few commodities or whose
economy depends on certain strategic imports could be vulnerable to fluctuations
in international prices of these commodities or imports. To the extent that a
country receives payment for its exports in currencies other than dollars, its
ability to make debt payments denominated in dollars could be adversely
affected. If a foreign government or government-related issuer cannot generate
sufficient earnings from foreign trade to service its external debt, it may need
to depend on continuing loans and aid from foreign governments, commercial banks
and multilateral organizations, and inflows of foreign investment. The
commitment on the part of these foreign governments, multilateral organizations
and others to make such disbursements may be conditioned on the government's
implementation of economic reforms and/or economic performance and the timely
service of its obligations. Failure to implement such reforms, achieve such
levels of economic performance or repay principal or interest when due may
curtail the willingness of such third parties to lend funds, which may further
impair the issuer's ability or willingness to service its debts in a timely
manner. The cost of servicing external debt will also generally be adversely
affected by rising international interest rates because many external debt
obligations bear interest at rates which are adjusted based upon international
interest rates. The ability to service external debt will also depend on the
level of the relevant government's international currency reserves and its
access to foreign exchange. Currency devaluations may affect the ability of a
government issuer to obtain sufficient foreign exchange to service its external
debt.

As a result of the foregoing, a foreign governmental issuer may default
on its obligations. If such a default occurs, the Funds may have limited
effective legal recourse against the issuer and/or guarantor. Remedies must, in
some cases, be pursued in the courts of the defaulting party itself, and the
ability of the holder of foreign government and government-related debt
securities to obtain recourse may be subject to the political climate in the
relevant country. In addition, no assurance can be given that the holders of
commercial bank debt will not contest payments to the holders of other foreign
government and government-related debt obligations in the event of default under
their commercial bank loan agreements.

Certain Latin American countries are among the largest debtors to
commercial banks and foreign governments.

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<PAGE>

Among the foreign government and government related issuers in which
the Funds may invest are certain high-yield securities, including so-called
Brady Bonds. The issuers of the foreign government and government-related high
yield securities, including Brady Bonds, in which the Funds expect to invest
have in the past experienced substantial difficulties in servicing their
external debt obligations, which have led to defaults on certain obligations and
the restructuring of certain indebtedness. Restructuring arrangements have
included, among other things, reducing and rescheduling interest and principal
payments by negotiating new or amended credit agreements or converting
outstanding principal and unpaid interest to Brady Bonds, and obtaining new
credit to finance interest payments. Holders of certain foreign government and
government-related high yield securities may be requested to participate in the
restructuring of such obligations and to extend further loans to their issuers.
There can be no assurance that the Brady Bonds and other foreign government and
government-related high yield securities in which the Funds may invest will not
be subject to similar defaults or restructuring arrangements which may adversely
affect the value of such investments. Furthermore, certain participants in the
secondary market for such debt may be directly involved in negotiating the terms
of these arrangements and may therefore have access to information not available
to other market participants.

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 newly issued
bonds (Brady Bonds). The investment advisers 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.

Region Risks. Each of the New Europe Fund and the Latin America Fund
intends to invest a majority of its assets in a specific region of the world.
Thus, each Fund's performance will be dependent upon the economic and financial
strength and stability of the region in which it invests. Shareholders should be
aware that in many regions of the world, and in particular in regions where
emerging countries are prevalent, the economies of the countries in such regions
are interdependent. Thus, to the extent that there is economic or financial
instability in one country, the likelihood that such instability will pervade
other countries in the region is high. Consequently, an investment in either the
New Europe Fund or the Latin America Fund is likely to be more volatile than an
investment in a more geographically diverse fund.

Small Company Investment Risks. Investments in common stocks in general
are subject to market, economic and business risks that will cause their price
to fluctuate over time. The securities of companies with smaller revenues and
capitalizations in which the New Europe and Latin America Funds may invest, may
offer greater opportunity for capital appreciation than larger companies, but
investment in such companies presents greater risks than securities of larger,
more established companies. Historically, smaller capitalization stocks have
been more volatile in price than larger capitalization stocks. Among the reasons
for the greater price volatility of these securities are the lower degree of
liquidity in the markets for such stocks, and the potentially greater
sensitivity of such small companies to changes in or failure of management, and
in many

-16-

<PAGE>

other changes in competitive, business, industry and economic conditions,
including risks associated with limited production, markets, management depth,
or financial resources.

Risks Related to Additional Investment Techniques. 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 Fund
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 Fund 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 the portfolio security if its market value exceeds the amount
of foreign currency the Fund is obligated to deliver.

The Funds may invest up to 30% of their respective net assets in high
yield, high risk foreign fixed-income securities. These securities are rated
lower than BBB by S&P and Baa by Moody's or, if unrated, are considered by the
Manager to be of equivalent quality. See Investment Objectives and Strategies
and High Yield, High Risk Securities. The Funds will not purchase securities
rated lower than C by S&P or Ca by Moody's, or, if unrated, considered to be of
an equivalent quality to such ratings by the Manager. See Appendix A - Ratings
to this Prospectus for more rating information. 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.

* * *

For additional information about the Funds' investment policies and
certain risks associated with investments in certain types of securities
including purchasing put and call options, futures contracts and options
thereon, and options on foreign currencies, see Other Investment Policies and
Risk Considerations in this Prospectus. Part B provides more information
concerning the Funds' investment policies, restrictions and risk factors.

-17-
<PAGE>

CLASSES OF SHARES

The Distributor serves as the national distributor for the Funds.
Shares of the Class may be purchased directly by contacting a Fund or its agent
or through authorized investment dealers. All purchases of shares of the Class
are made at net asset value. There is no front-end or contingent deferred sales
charge.

Investment instructions given on behalf of participants in an
employer-sponsored retirement plan are made in accordance with directions
provided by the employer. Employees considering purchasing shares of the Class
as part of their retirement program should contact their employer for details.

Shares of the Class are available for purchase only by: (a) retirement
plans introduced by persons not associated with brokers or dealers that are
primarily engaged in the retail securities business and rollover individual
retirement accounts from such plans; (b) tax-exempt employee benefit plans of
the Manager or its affiliates and securities dealer firms with a selling
agreement with the Distributor; (c) institutional advisory accounts of the
Manager or its affiliates, and those having client relationships with Delaware
Investment Advisers (an affiliate of the Manager) or its affiliates, and their
corporate sponsors, as well as subsidiaries and related employee benefit plans
and rollover individual retirement accounts from such institutional advisory
accounts; (d) a bank, trust company and similar financial institution investing
for its own account or for the account of its trust customers for whom such
financial institution is exercising investment discretion in purchasing shares
of the Class, except where the investment is part of a program that requires
payment to the financial institution of a Rule 12b-1 Plan fee; and (e)
registered investment advisers investing on behalf of clients that consist
solely of institutions and high net-worth individuals having at least $1,000,000
entrusted to the adviser for investment purposes, but only if the adviser is not
affiliated or associated with a broker or dealer and derives compensation for
its services exclusively from its clients for such advisory services.

Class A, Class B and Class C Shares of the Funds
In addition to offering the Class of the Funds, each Fund also offers
Class A, Class B and Class C shares, which are described in a separate
prospectus. Shares of the Funds may be purchased through authorized investment
dealers or directly by contacting a Fund or its Distributor. Class A Shares,
Class B Shares and Class C Shares may have different sales charges and other
expenses which may affect performance. To obtain a prospectus relating to such
classes, contact the Distributor by writing to the address or by calling the
phone number listed on page 1 of this Prospectus.

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<PAGE>

HOW TO BUY SHARES

The Funds make it easy to invest by mail, by wire, by exchange and by
arrangement with your investment dealer. In all instances, investors must
qualify to purchase shares of the Class.

Investing Directly by Mail
1. Initial Purchases--An Investment Application, or in the case of a retirement
account, an appropriate retirement plan application, must be completed, signed
and sent with a check payable to the specific Fund and Class selected to
Delaware Investments at 1818 Market Street, Philadelphia, PA 19103.

Investing Directly by Wire
You may purchase shares by requesting your bank to transmit funds by
wire to First Union National Bank, ABA #031201467, account number 2014128934013
(include your name(s) and your account number for the Class in which you are
investing).

1. Initial Purchases--Before you invest, telephone the Fund's Client Services
Department at 800-510-4015 to get an account number. If you do not call first,
it may delay processing your investment. In addition, you must promptly send
your Investment Application, or in the case of a retirement account, an
appropriate retirement plan application, to the specific Fund and Class
selected, to Delaware Investments at 1818 Market Street, Philadelphia, PA 19103.

2. Subsequent Purchases--You may make additional investments anytime by wiring
funds to First Union National Bank, as described above. You must advise your
Client Services Representative by telephone at 800-510-4015 prior to sending
your wire.

Investing by Exchange
If you have an investment in another mutual fund in Delaware
Investments and you qualify to purchase shares of the Class, you may write and
authorize an exchange of part or all of your investment into shares of any of
the Funds of the same Class of shares. Accordingly, Class B Shares and Class C
Shares of the Funds and any other funds in Delaware Investments offering such a
class of shares may not be exchanged into the Class. If you wish to open an
account by exchange, call your Client Services Representative at 800-510-4015
for more information. See Redemption and Exchange for more complete information
concerning your exchange privileges.

Investing through Your Investment Dealer
You can make a purchase of shares of the Fund through most investment
dealers who, as part of the service they provide, must transmit orders promptly.
They may charge for this service.

Purchase Price and Effective Date
The purchase price (net asset value) is determined as of the close of
regular trading on the New York Stock Exchange (ordinarily, 4 p.m., Eastern
time) on days when the Exchange is open.

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<PAGE>

The effective date of a purchase made through an investment dealer is
the date the order is received by a Fund, its agent or designee. The effective
date of a direct purchase is the day your wire, electronic transfer or check is
received, unless it is received after the time the share price is determined, as
noted above. Purchase orders received after such time will be effective the next
business day.

The Conditions of Your Purchase
The Funds reserve the right to reject any purchase order. If a purchase
is canceled because your check is returned unpaid, you are responsible for any
loss incurred. Each Fund can redeem shares from your account(s) to reimburse
itself for any loss, and you may be restricted from making future purchases in
any of the funds in Delaware Investments. Each Fund reserves the right to reject
purchase orders paid by third-party checks or checks that are not drawn on a
domestic branch of a United States financial institution. If a check drawn on a
foreign financial institution is accepted, you may be subject to additional bank
charges for clearance and currency conversion.

Each Fund also reserves the right, upon 60 days' written notice, to
involuntarily redeem accounts that remain under $250 as a result of redemptions.

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<PAGE>

REDEMPTION AND EXCHANGE

Redemption and exchange requests made on behalf of participants in an
employer-sponsored retirement plan are made in accordance with directions
provided by the employer. Employees should therefore contact their employer for
details.

Your shares will be redeemed or exchanged based on the net asset value
next determined after the Fund receives your request in good order. For example,
redemption or exchange requests received in good order after the time the net
asset value of shares is determined will be processed on the next business day.
See Purchase Price and Effective Date under How to Buy Shares. Except as
otherwise noted below, for a redemption request to be in "good order," you must
provide your account number, account registration, and the total number of
shares or dollar amount of the transaction. With regard to exchanges, you must
also provide the name of the fund in which you want to invest the proceeds.
Exchange instructions and redemption requests must be signed by the record
owner(s) exactly as the shares are registered. You may request a redemption or
an exchange by calling a Fund at 800-510-4015. Redemption proceeds will be
distributed promptly, as described below, but not later than seven days after
receipt of a redemption request.

A Fund will process written and telephone redemption requests to the
extent that the purchase orders for the shares being redeemed have already
settled. A Fund will honor redemption requests as to shares for which a check
was tendered as payment, but the Fund will not mail or wire the proceeds until
it is reasonably satisfied that the check has cleared, which may take up to 15
days from the purchase date. You can avoid this potential delay if you purchase
shares by wiring Federal Funds. Each Fund reserves the right to reject a written
or telephone redemption request or delay payment of redemption proceeds if there
has been a recent change to the shareholder's address of record.

Shares of the Class may be exchanged into any other Delaware
Investments mutual fund, provided: (1) the investment satisfies the eligibility
and other requirements set forth in the prospectus of the fund being acquired,
including the payment of any applicable front-end sales charge; and (2) the
shares of the fund being acquired are in a state where that fund is registered.
If exchanges are made into other shares that are eligible for purchase only by
those permitted to purchase shares of the Class, such shares will be exchanged
at net asset value. Shares of the Class may not be exchanged into Class B Shares
or Class C Shares of other funds offered by Delaware Investments. Each Fund may
suspend, terminate or amend the terms of the exchange privilege upon 60 days'
written notice to shareholders.

Various redemption and exchange methods are outlined below. No fee is
charged by a Fund or the Distributor for redeeming or exchanging your shares,
although in the case of an exchange, a sales charge may apply. You may also have
your investment dealer arrange to have your shares redeemed or exchanged. Your
investment dealer may charge for this service.

All authorizations given by shareholders, including selection of any of
the features described below, shall continue in effect until such time as a
written revocation or modification has been received by a Fund or its agent.

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<PAGE>

Written Redemption and Exchange
You can write to Fund at 1818 Market Street, Philadelphia, PA 19103 to
redeem some or all of your shares or to request an exchange of any or all of
your shares into another mutual fund offered by Delaware Investments, subject to
the same conditions and limitations as other exchanges noted above. The request
must be signed by all owners of the account or your investment dealer of record.

For redemptions of more than $50,000, or when the proceeds are not sent
to the shareholder(s) at the address of record, a Fund requires a signature by
all owners of the account and may require a signature guarantee. A signature
guarantee can be obtained from a commercial bank, a trust company or a member of
a Securities Transfer Association Medallion Program ("STAMP"). A signature
guarantee cannot be provided by a notary public. A signature guarantee is
designed to protect the shareholders, the Fund and its agents from fraud. Each
Fund reserves the right to reject a signature guarantee supplied by an eligible
institution based on its creditworthiness. Each Fund may require further
documentation from corporations, executors, retirement plans, administrators,
trustees or guardians.

Payment is normally mailed the next business day after receipt of your
redemption request. Certificates are issued for shares only if you submit a
specific request. If your shares are in certificate form, the certificate(s)
must accompany your request and also be in good order.

You also may submit your written request for redemption or exchange by
facsimile transmission at the following number: 215-255-8864.

Telephone Redemption and Exchange
To get the added convenience of the telephone redemption and exchange
methods, you must have the Transfer Agent hold your shares (without charge) for
you. If you choose to have your shares in certificate form, you may redeem or
exchange only by written request and you must return your certificates.

The Telephone Redemption--Check to Your Address of Record service and
the Telephone Exchange service, both of which are described below, are
automatically provided unless you notify the Fund in writing that you do not
wish to have such services available with respect to your account. The Funds
reserve the right to modify, terminate or suspend these procedures upon 60 days'
written notice to shareholders. It may be difficult to reach a Fund by telephone
during periods when market or economic conditions lead to an unusually large
volume of telephone requests.

Neither the Funds nor their Transfer Agent is responsible for any
shareholder loss incurred in acting upon written or telephone instructions for
redemption or exchange of Fund shares which are reasonably believed to be
genuine. With respect to such telephone transactions, each Fund will follow
reasonable procedures to confirm that instructions communicated by telephone are
genuine (including verification of a form of personal identification) if it does
not, a Fund or the Transfer Agent 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.
By exchanging shares by telephone, you are acknowledging prior receipt of a
prospectus for the fund into which your shares are being exchanged.

Telephone Redemption--Check to Your Address of Record
You or your investment dealer of record can have redemption proceeds of
$50,000 or less mailed to you at your record address. Checks will be payable to
the shareholder(s) of record. Payment is normally mailed the next business day
after receipt of the redemption request.

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<PAGE>

Telephone Redemption--Proceeds to Your Bank
Redemption proceeds of $1,000 or more can be transferred to your
predesignated bank account by wire or by check. You should authorize this
service when you open your account. If you change your predesignated bank
account, you must submit a written authorization and you may need to have your
signature guaranteed. For your protection, your authorization must be on file.
If you request a wire, your funds will normally be sent the next business day.
If you ask for a check, it will normally be mailed the next business day after
receipt of your redemption request to your predesignated bank account. There are
no fees for this redemption method, but the mail time may delay getting funds
into your bank account. Simply call your Client Services Representative prior to
the time the net asset value is determined, as noted above.

Telephone Exchange
You or your investment dealer of record can exchange shares into any
fund offered by Delaware Investments under the same registration. As with the
written exchange service, telephone exchanges are subject to the same conditions
and limitations as other exchanges noted above. Telephone exchanges may be
subject to limitations as to amounts or frequency.

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<PAGE>

DIVIDENDS AND DISTRIBUTIONS

Global Funds, Inc. declares a dividend on each Fund to all shareholders
of record of the Class of the Fund at the time the offering price of shares is
determined. See Purchase Price and Effective Date under How to Buy Shares. Thus,
when redeeming shares, dividends continue to be credited up to and including the
date of redemption.

Each Fund will normally declare and make payments from net investment
income on an annual basis. Payments from net realized securities profits of a
Fund, if any, will be made in the quarter following the close of the fiscal
year. Both dividends and distributions, if any, are automatically reinvested in
your account at net asset value.

In addition to the dividends from net investment income and
distributions from realized securities profits that a Fund may declare and make,
as noted above, in order to satisfy certain distribution requirements of the Tax
Reform Act of 1986, each Fund may declare special year-end dividend and capital
gains distributions during October, 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 the Fund and received by
shareholders on the earlier of the date paid or December 31 of the prior year.

Each class of a Fund will share proportionately in the investment
income and expenses of the Fund, except that the Class will not incur any
distribution fee under Global Funds, Inc.'s 12b-1 Plans which apply to Class A
Shares, Class B Shares and Class C Shares.

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<PAGE>

TAXES

The tax discussion set forth below is included for general information
only. Investors should consult their own tax advisers concerning the federal,
state, local or foreign tax consequences of an investment in the Fund.

On August 5, 1997, the Taxpayer Relief Act of 1997 (the "1997 Act") was
signed into law. This new law makes sweeping changes in the Internal Revenue
Code (the "Code"). Because many of these changes are complex, and only
indirectly affect the Fund and its distributions to you, they are discussed in
Part B. Changes in the treatment of capital gains, however, are discussed in
this section.

Each Fund intends to qualify as a regulated investment company under
Subchapter M of the Code. As such, the Fund will not be subject to federal
income tax, or to any excise tax, to the extent its earnings are distributed as
provided in the Code and it satisfies certain other requirements relating to the
sources of its income and diversification of its assets.

Each Fund intends to distribute substantially all of its net investment
income and net capital gains, if any. Dividends from net investment income or
net short-term capital gains will be taxable to those investors who are subject
to income taxes as ordinary income, whether received in cash or in additional
shares. It is expected that either none or only a nominal portion of a Fund's
dividends will be eligible for the dividends-received deductions for
corporations. The portion of dividends paid by a Fund that so qualifies will be
designated each year in a notice from the Fund to the Fund's shareholders.

Distributions paid by a Fund from long-term capital gains, whether
received in cash or in additional shares, are taxable to those investors who are
subject to income taxes as long-term capital gains, regardless of the length of
time an investor has owned shares in the Fund. No Fund seeks to realize any
particular amount of capital gains during a year; rather, realized gains are a
by-product of Fund management activities. Consequently, capital gains
distributions may be expected to vary considerably from year to year. Also, for
those investors subject to tax, if purchases of shares in a Fund are made
shortly before the record date for a dividend or capital gains distribution, a
portion of the investment will be returned as a taxable distribution.

The Treatment of Capital Gain Distributions under the Taxpayer Relief Act of
1997
The 1997 Act creates a category of long-term capital gain for
individuals that will be taxed at new lower tax rates. For investors who are in
the 28% or higher federal income tax brackets, these gains will be taxed at a
maximum rate of 20%. For investors who are in the 15% federal income tax
bracket, these gains will be taxed at a maximum rate of 10%. Capital gain
distributions will qualify for these new maximum tax rates, depending on when a
Fund's securities were sold and how long they were held by the Fund before they
were sold. The holding periods for which the new rates apply were revised by the
Internal Revenue Service Restructuring and Reform Act of 1998. Investors who
want more information on holding periods and other qualifying rules relating to
these new rates should review the expanded discussion in Part B, or should
contact their own tax advisers.

Global Funds, Inc. will advise you in its annual information reporting
at calendar year end of the amount of its capital gain distributions which will
qualify for these maximum federal tax rates.

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<PAGE>

which, for operational reasons, may not be paid to the shareholder until the
following January, will be treated for tax purposes as if paid by the Fund and
received by the shareholder on December 31 of the calendar year in which they
are declared.

Each Fund may be subject to foreign withholding taxes on income from
certain of its foreign securities. If more than 50% in value of the total assets
of a Fund at the end of its fiscal year is invested in securities of foreign
corporations, the Fund may elect to pass-through to its shareholders a pro-rata
share of foreign income taxes paid by the Fund. If this election is made,
shareholders will be (i) required to include in their gross income their
pro-rata share of foreign source income (including any foreign taxes paid by the
Fund), and (ii) entitled to either deduct (as an itemized deduction in the case
of individuals) their share of such foreign taxes in computing their taxable
income or to claim a credit for such taxes against their U.S. income tax,
subject to certain limitations under the Code. Shareholders will be informed by
the Fund at the end of each calendar year regarding the availability of any
credits on and the amount of foreign source income to be included in their
income tax returns.

In addition to the federal taxes described above, shareholders may or
may not be subject to various state and local taxes. For example, distributions
of interest income and capital gains realized from certain types of U.S.
government securities may be exempt from state personal income taxes. Because
investors' state and local taxes may be different than the federal taxes
described above, investors should consult their own tax advisers.

Each year, Global Funds, Inc. will mail to you information on the tax
status of each Fund's dividends and distributions. Shareholders will also
receive each year information as to the portion of dividend income, if any, that
is derived from U.S. government securities that are exempt from state income
tax. Of course, shareholders who are not subject to tax on their income would
not be required to pay tax on amounts distributed to them by a Fund.

Global Funds, Inc. 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 Investment Application your proper
Taxpayer Identification Number and by certifying that you are not subject to
backup withholding.

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

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CALCULATION OF NET ASSET VALUE PER SHARE

The purchase and redemption price of Class shares of each Fund is the
net asset value ("NAV") per share of Class shares next computed after the order
is received. The NAV is computed as of the close of regular trading on the New
York Stock Exchange (ordinarily, 4 p.m., Eastern time) on days when the Exchange
is open.

The NAV per share is computed by adding the value of all securities and
other assets in a Fund's portfolio, deducting any liabilities of the Fund
(expenses and fees are accrued daily) and dividing by the number of Fund shares
outstanding. Portfolio securities for which market quotations are available are
priced at market value. Debt securities are priced at fair value by an
independent pricing service using methods approved by Global Funds, Inc.'s Board
of Directors. Short-term investments having a maturity of less than 60 days are
valued at amortized cost, which approximates market value. All other securities
are valued at their fair value as determined in good faith and in a method
approved by Global Funds, Inc.'s Board of Directors.

Each Fund's portfolio securities, 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 U.S. holidays or Saturdays). As a result, the net
asset value of each Fund may be significantly affected by such trading on days
when shareholders have no access to the Fund.

The net asset values of all outstanding shares of each class of each
Fund will be computed on a pro-rata basis for each outstanding share based on
the proportionate participation in the Fund represented by the value of shares
of that class. All income earned and expenses incurred by a Fund will be borne
on a pro-rata basis by each outstanding share of a class, based on each class'
percentage in the Fund represented by the value of shares of such classes,
except that the Class of each Fund will not incur any of the expenses under
Global Funds, Inc.'s 12b-1 Plans related to each Fund and Class A Shares, Class
B Shares and Class C Shares of each Fund alone will bear the 12b-1 Plan expenses
payable under their respective 12b-1 Plans. Due to the specific distribution
expenses and other costs that will be allocable to each class, the net asset
value of each class of each Fund will vary.

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MANAGEMENT OF THE FUNDS

Directors
The business and affairs of Global Funds, Inc. are managed under the
direction of its Board of Directors. Part B contains additional information
regarding Global Funds, Inc.'s directors and officers.

Investment Manager
The Manager furnishes investment management services to each Fund. The
Manager has offices located at 80 Cheapside, Third Floor, London, England EC2V
6EE.

Delaware Management Company ("Delaware") and its predecessors have been
managing the funds in Delaware Investments since 1938. On September 30, 1998,
Delaware and its affiliates within Delaware Investments, including the Manager,
were managing in the aggregate more than $40 billion in assets in the various
institutional or separately managed (approximately $23,666,360,000) and
investment company (approximately $17,194,990,000) accounts.

Delaware is a series of Delaware Management Business Trust. Delaware
changed its form of organization from a corporation to a business trust on March
1, 1998. Delaware is an indirect, wholly owned subsidiary of Delaware Management
Holdings, Inc. ("DMH"). The Manager is also controlled by DMH through several
subsidiaries. On April 3, 1995, a merger between DMH and a wholly owned
subsidiary of Lincoln National Corporation ("Lincoln National") was completed.
DMH, Delaware and the Manager are now indirect, wholly owned subsidiaries, and
subject to the ultimate control, of Lincoln National. Lincoln National, with
headquarters currently located in Fort Wayne, Indiana, is a diversified
organization with operations in many aspects of the financial services industry,
including insurance and investment management. The Manager has entered into an
Investment Management Agreement with Global Funds, Inc. on behalf of the Funds.

The Manager manages each Fund's investments and for its services, each
Fund has agreed to pay the Manager an annual fee equal to 1.25% on the first
$500 million of average daily net assets; 1.20% on the next $500 million; 1.15%
on the next $1.5 billion; and 1.10% on the average daily net assets in excess of
$2.5 billion. The directors of Global Funds, Inc. annually review the fees paid
to the Manager.

The Manager has elected voluntarily to waive that portion, if any, of
the annual management fees payable by the New Europe and Latin America Funds and
to pay expenses of each Fund to the extent necessary to ensure that the Total
Operating Expenses (exclusive of taxes, interest, brokerage commissions and
extraordinary expenses) of each Fund do not exceed 1.25%, respectively, through
May 31, 1999.

The investment management fees payable to the Manager, while higher
than the advisory fees paid by other mutual funds in general, are comparable to
fees paid by other mutual funds with similar objectives and policies.

Nigel May, Richard Ginty and Joshua Brooks have primary responsibility
for making day-to-day investment decisions for New Europe Fund. Mr. May is a
graduate of Sidney Sussex College, Cambridge and joined Delaware International
in 1991, assuming portfolio management responsibilities and sharing analytical
responsibilities for continental Europe. Prior to joining Delaware
International, he spent five years with Hill Samuel Investment Advisers Ltd.

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<PAGE>

Mr. Ginty, a graduate of Sheffield University, joined Delaware
International in 1992, where his primary research focus is the European equity
markets. Prior to joining Delaware International, his business experience was
with Kleinwort Benson Securities Limited, and prior to that time, with Fiduciary
Trust International.

Mr. Brooks is a graduate of Yale University and has undertaken graduate
studies at The London Business School. Having joined Delaware Management Company
in 1991, Mr. Brooks first worked in equity market analysis and as a Philadelphia
liaison with Delaware International and thereafter joined Delaware
International's emerging markets team in London.

Clive A. Gillmore, Robert Akester and Mr. Brooks have primary
responsibility for making day-to-day investment decisions for Latin America
Fund. A graduate of the University of Warwick and having begun his career at
Legal and General Investment Management, Mr. Gillmore joined Delaware
Investments in 1990 after eight years of investment experience. His most recent
position prior to joining Delaware International was as a Pacific Basin equity
analyst and senior portfolio manager for Hill Samuel Investment Advisers Ltd.
Mr. Gillmore completed the London Business School Investment program.

Mr. Akester, a graduate of University College, London, joined Delaware
International in 1996 after 26 years of investment experience. His most recent
position prior to joining Delaware International was as Director of Hill Samuel
Investment Advisers Ltd. where he had responsibility for significant overseas
clients and Far Eastern Markets. Mr. Akester is an Associate of the Institute of
Actuaries.

Portfolio Trading Practices
The Funds normally will not invest for short-term trading purposes.
However, a Fund may sell securities without regard to the length of time they
have been held. The degree of portfolio activity will affect brokerage costs of
a Fund and may affect taxes payable by such Fund's shareholders to the extent
that net capital gains are realized. Given each Fund's investment objective, it
is anticipated that the portfolio turnover rate of each Fund will not exceed
100%.

The Manager uses its best efforts to obtain the best available price
and most favorable execution for portfolio transactions. Orders may be placed
with brokers or dealers who provide brokerage and research services to the
Manager or their advisory clients. These services may be used by the Manager in
servicing any of its accounts. Subject to best price and execution, the Manager
may consider a broker/dealer's sales of shares of funds offered by Delaware
Investments in placing portfolio orders and may place orders with broker/dealers
that have agreed to defray certain expenses of such funds, such as custodian
fees.

Performance Information
From time to time, the Funds may quote total return performance of this
Class 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. Each
presentation will include the average annual total return for one-year,
five-year and ten-year, or life-of-fund periods, as applicable. The Funds may
also advertise aggregate and average total return information concerning the
Class over additional periods of time.

Because securities prices fluctuate, investment results of the Class
will fluctuate over time. Past performance is not considered a guarantee of
future results.

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<PAGE>

Statements and Confirmations
You will receive quarterly statements of your account summarizing all
transactions during the period. A confirmation statement will be sent following
all transactions other than those involving a reinvestment of dividends. You
should examine statements and confirmations immediately and promptly report any
discrepancy by calling your Client Services Representative.

Financial Information about each Fund
Each fiscal year, you will receive an audited annual report and an
unaudited semi-annual report. These reports provide detailed information about
each Fund's investments and performance. Global Funds, Inc.'s fiscal year ends
on November 30.

Distribution and Service
The Distributor, Delaware Distributors, L.P., serves as the national
distributor for the Fund's shares under a Distribution Agreement with Global
Funds, Inc. dated as of December 23, 1998.

The Transfer Agent, Delaware Service Company, Inc., serves as the
shareholder servicing, dividend disbursing and transfer agent for each Fund
under an amended and restated agreement dated December 23, 1998. The Transfer
Agent also provides accounting services to each Fund pursuant to the terms of a
separate Fund Accounting Agreement. Certain recordkeeping services and other
shareholder services that otherwise would be performed by the Transfer Agent may
be performed by certain other entities and the Transfer Agent may elect to enter
into an agreement to pay such other entities for those services. In addition,
participant account maintenance fees may be assessed for certain recordkeeping
services provided as part of retirement plan and administration service
packages. These fees are based on the number of participants in the plan and the
various services selected. Fees will be quoted upon request and are subject to
change.

The directors of Global Funds, Inc. annually review the fees paid to
the Distributor and the Transfer Agent. The Distributor and the Transfer Agent
are indirect, wholly owned subsidiaries of DMH.

* * *

As with other mutual funds, financial and business organizations and
individuals around the world, each Fund could be adversely affected if the
computer systems used by its service providers do not properly process and
calculate date-related information from and after January 1, 2000. This is
commonly known as the "Year 2000 Problem." Global Funds, Inc. is taking steps to
obtain satisfactory assurances that the Funds' major service providers are
taking steps reasonably designed to address the Year 2000 Problem with respect
to the computer systems that such service providers use. There can be no
assurances that these steps will be sufficient to avoid any adverse impact on
the business of the Funds.

Several European countries are participating in the European Economic
and Monetary Union, which will establish a common European currency for
participating countries. This currency will commonly be known as the "Euro." It
is anticipated that each such participating country will replace its existing
currency with the Euro on January 1, 1999. Additional European countries may
elect to participate after that date. If either Fund is invested in securities
of participating countries such Fund could be adversely affected if the computer
systems used by its major service providers are not properly prepared to handle
the implementation of this single currency or the adoption of the Euro by
additional countries in the future. Global Funds, Inc. is taking steps to obtain
satisfactory assurances that the major service

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<PAGE>

providers of each of the Funds are taking steps reasonablydesigned to address
these matters with respect to the computer systems that such service providers
use. There can be no assurances that these steps will be sufficient to avoid any
adverse impact on the business of the Funds.

Expenses
Each Fund is responsible for all of its own expenses other than those
borne by the Manager under the Investment Management Agreement and those borne
by the Distributor under the Distribution Agreement. Each Fund's expenses
include its 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.

Shares
Global Funds, Inc. is an open-end management investment company.
Commonly known as a mutual fund, Global Funds, Inc. was organized as a Maryland
corporation on May 30, 1991. Global Funds, Inc. currently offers eight series of
shares - International Equity Series, International Small Cap Series, Global
Bond Series, Global Assets Series, Emerging Markets Series, Global Equity
Series, New Europe Series and Latin America Series. Each Fund's shares have a
par value of $.01 and 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 conversion, exchange, dividends, retirement or other features
and have no preemptive rights. Each fund will vote separately on any matter
which affects only that fund. Shares of each fund have a priority over shares of
any other fund of Global Funds, Inc. in the assets and income of that fund.

All shares have noncumulative voting rights which means that the
holders of more than 50% of Global Funds, Inc.'s shares voting for the election
of directors can elect 100% of the directors if they choose to do so. Under
Maryland law, Global Funds, Inc. is not required, and does not intend, to hold
annual meetings of shareholders unless, under certain circumstances, it is
required to do so under the 1940 Act.

In addition to Class shares, each Fund also offers Class A, Class B and
Class C shares. Shares of each Class represent proportionate interests in the
assets of each Fund and have the same voting and other rights and preferences as
the other classes of the Fund, except that shares of the Classes are not subject
to, and may not vote on matters affecting, the Distribution Plans under Rule
12b-1 relating to Class A Shares, Class B Shares and Class C Shares.

The Lincoln National Life Insurance Company ("LNLIC") is expected to
make the initial investment in the Fund. As a result, LNLIC could own up to 100%
of the outstanding shares of the Fund. Subject to certain limited exceptions,
there are no limitations on LNLIC's ability to redeem its shares of the Fund and
it may elect to do so at any time.

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OTHER INVESTMENT POLICIES AND RISK CONSIDERATIONS

Foreign Currency Transactions
Although each Fund values its assets daily in terms of U.S. dollars, it
does not intend to convert its holdings of foreign currencies into U.S. dollars
on a daily basis. Each Fund 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. Each Fund 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 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. The Funds will convert currency on a spot
basis from time to time, and investors should be aware of the costs of currency
conversion.

Each Fund may enter into forward contracts to "lock in" the price of a
security it has agreed to purchase or sell, in terms of U.S. dollars or other
currencies in which the transaction will be consummated. 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, each Fund 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.

When the Manager believes that the currency of a particular country may
suffer a significant decline against the U.S. dollar or against another
currency, a Fund may enter into a forward foreign currency contract to sell, for
a fixed amount of U.S. dollars or other appropriate currency, the amount of
foreign currency approximating the value of some or all of the Fund's securities
denominated in such foreign currency.

The Funds will not enter into forward contracts or maintain a net
exposure to such contracts where the consummation of the contracts would
obligate a Fund to deliver an amount of foreign currency in excess of the value
of such Fund's securities or other assets denominated in that currency.

At the maturity of a forward contract, a Fund 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
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 Fund may realize gains or losses from currency
transactions.

Each Fund also may purchase and write put and call options on foreign
currencies (traded on U.S. and foreign exchanges or over-the-counter) for
hedging purposes to protect against declines in the U.S. dollar cost of foreign
securities held by the Fund and against increases in the U.S. dollar cost of
such securities to be acquired. Call options on foreign currency written by a
Fund will be covered, which means that the Fund will own the underlying foreign
currency. With respect to put options on foreign currency written by a Fund, the
Fund will establish a segregated account with its Custodian Bank consisting of
cash, U.S. government securities or other high-grade liquid debt securities in
an amount equal to the amount the Fund will be required to pay upon exercise of
the put.

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As in the case of other kinds of options, the writing of an option on
foreign currency will constitute only a partial hedge, up to the amount of the
premium received, and a Fund could be required to purchase or sell foreign
currencies at disadvantageous exchange rates, thereby incurring losses. The
purchase of an option on foreign currency may constitute an effective hedge
against fluctuations in exchange rates, although, in the event of rate movements
adverse to a Fund's position, the Fund may forfeit the entire amount of the
premium plus related transaction costs. See Special Risk Considerations.

Depositary Receipts
Each Fund may invest in sponsored and unsponsored American Depositary
Receipts ("ADRs"), European Depositary Receipts ("EDRs") and Global Depositary
Receipts ("GDRs") 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. EDRs and
GDRs are receipts issued by non-U.S. Banks or trust companies and foreign
branches of U.S. banks that evidence ownership of the underlying foreign or U.S.
securities. "Sponsored" ADRs, EDRs or GDRs are issued jointly by the issuer of
the underlying security and a Depositary, and "unsponsored" ADRs, EDRs or GDRs
are issued without the participation of the issuer of the deposited security.
Holders of unsponsored ADRs, EDRs or GDRs generally bear all the costs of such
facilities and the Depositary of an unsponsored ADR, EDR or GDR 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, EDR or GDR.
ADRs may be listed on a national securities exchange or may be traded in the
over-the-counter market. EDRs and GDRs traded in the over-the-counter market
which do not have an active or substantial secondary market will be considered
illiquid and therefore will be subject to a Fund's limitation with respect to
such securities. ADR prices are denominated in U.S. dollars although the
underlying securities are denominated in a foreign currency. Investments in
ADRs, EDRs and GDRs involve risks similar to those accompanying direct
investments in foreign securities.

Rule 144A Securities
While maintaining oversight, the Board of Directors of Global Funds,
Inc. has delegated to the Manager the day-to-day functions of determining
whether or not individual Rule 144A Securities are liquid for purposes of each
Fund's 15% limitation on investments in illiquid assets. The Board has
instructed the Manager to consider the following factors in determining the
liquidity of a Rule 144A Security: (i) the frequency of trades and trading
volume for the security; (ii) whether at least three dealers are willing to
purchase or sell the security and the number of potential purchasers; (iii)
whether at least two dealers are making a market in the security; and (iv) the
nature of the security and the nature of the marketplace trades (e.g., the time
needed to dispose of the security, the method of soliciting offers, and the
mechanics of transfer).

If the Manager determines that a Rule 144A Security which was
previously determined to be liquid is no longer liquid and, as a result, a
Fund's holdings of illiquid securities exceed the Fund's 15% limitation on
investments in such securities, the Manager will determine what action to take
to ensure that the Fund continues to adhere to its respective limitation.

Portfolio Loan Transactions
Each Fund may loan up to 25% of its assets to qualified broker/dealers
or institutional investors for their use relating to short sales or other
security transactions.

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The major risk to which a Fund would be exposed on a loan transaction
is the risk that the borrower would go bankrupt at a time when the value of the
security goes up, and the borrower would fail to return the borrowed security.
Therefore, each Fund will only enter into loan arrangements after a review of
all pertinent facts by the Manager, subject to overall supervision by the Board
of Directors, including the creditworthiness of the borrowing broker, dealer or
institution and then only if the consideration to be received from such loans
would justify the risk. In addition, a Fund will require borrowers to deliver
collateral to the Fund before lending securities. Creditworthiness will be
monitored on an ongoing basis by the Manager.

Investment Company Securities
Any investments that a Fund makes in either closed-end or open-end
investment companies will be limited by the 1940 Act, and would involve an
indirect payment of a portion of the expenses, including advisory fees, of such
other investment companies. Under the 1940 Act's limitations, a Fund may not (1)
own more than 3% of the voting stock of another investment company; (2) invest
more than 5% of the Fund's total assets in the shares of any one investment
company; nor (3) invest more than 10% of the Fund's total assets in shares of
other investment companies. These percentage limitations also apply to a Fund's
investments in unregistered investment companies.

Repurchase Agreements
Each Fund also may use repurchase agreements that are at least 102%
collateralized by securities in which the Fund can invest directly, including
securities issued or guaranteed by the U.S. government or its agencies or
instrumentalities. Repurchase agreements help a Fund to invest cash on a
temporary basis. Each Fund may invest cash balances in joint repurchase
agreements with other Delaware Investments funds. Under a repurchase agreement,
a Fund acquires ownership and possession of a security, and the seller agrees to
buy the security back at a specified time and higher price. Repurchase
agreements involve the risks of loss if a seller defaults on its obligations
under the agreements. If the seller is unable to repurchase the security, a Fund
could experience delays in liquidating the securities. To minimize this
possibility, the Manager, pursuant to direction from the Global Funds, Inc.'s
Board of Directors, considers the creditworthiness of banks and dealers when
entering into repurchase agreements.

Borrowings
Each Fund may borrow money as a temporary measure for extraordinary
purposes or to facilitate redemptions. A Fund will not borrow money in excess of
one-third of the value of its net assets. A Fund has no intention of increasing
its net income through borrowing. Any borrowing will be done from a bank and, to
the extent that such borrowing exceeds 5% of the value of a Fund's net assets,
asset coverage of at least 300% is required. In the event that such asset
coverage shall at any time fall below 300%, a Fund shall, within three days
thereafter (not including Sunday or holidays) or such longer period as the U.S.
Securities and Exchange Commission may prescribe by rules and regulations,
reduce the amount of its borrowings to such an extent that the asset coverage of
such borrowings shall be at least 300%. A Fund will not pledge more than 10% of
its net assets, or issue senior securities as defined in the 1940 Act, except
for notes to banks. Investment securities will not be purchased while a Fund has
an outstanding borrowing.

Options
The Manager may employ options techniques in an attempt to protect
appreciation attained and to take advantage of the liquidity available in the
options market. Each Fund may purchase call options on foreign or U.S.
securities and indices and enter into related closing transactions. Each Fund
may also purchase put options on such securities and indices and enter into
related closing transactions.

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A call option enables the purchaser, in return for the premium paid, to
purchase securities from the writer of the option at an agreed price up to an
agreed date. The advantage is that the purchaser may hedge against an increase
in the price of securities it ultimately wishes to buy or take advantage of a
rise in a particular index. Each Fund will only purchase call options to the
extent that premiums paid on all outstanding call options do not exceed 2% of
its total assets.

A put option enables the purchaser of the option, in return for the
premium paid, to sell the security underlying the option to the writer at the
exercise price during the option period, and the writer of the option has the
obligation to purchase the security from the purchaser of the option. A Fund
will only purchase put options to the extent that the premiums on all
outstanding put options do not exceed 2% of its total assets. The advantage is
that the purchaser can be protected should the market value of the security
decline or should a particular index decline.

An option on a securities index gives the purchaser of the option, in
return for the premium paid, the right to receive from the seller cash equal to
the difference between the closing price of the index and the exercise price of
the option.

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

In purchasing put and call options, the premium paid by a Fund plus any
transaction costs will reduce any benefit realized by such Fund upon exercise of
the option.

Each Fund may use both Exchange-traded and over-the-counter options.
Certain over-the-counter options may be illiquid. Each Fund will only invest in
such options to the extent consistent with its 15% limitation on investment in
illiquid securities. The Funds will comply with U.S. Securities and Exchange
Commission asset segregation and coverage requirements when engaging in these
types of transactions.

Futures Contracts and Options on Futures Contracts
The principal purpose of the purchase or sale of futures contracts for
a Fund is to protect the Fund against the fluctuations in interest or exchange
rates which otherwise might adversely affect the value of such Fund's portfolio
securities or adversely affect the prices of securities which the Fund intends
to purchase at a later date without actually buying or selling such securities.

Each Fund may enter into contracts for the purchase or sale for future
delivery of securities or foreign currencies. A purchase of a futures contract
means the acquisition of a contractual right to obtain delivery to the Fund of
the securities or foreign currency called for by the contract at a specified
price during a specified future month. When a futures contract is sold, a Fund
incurs a contractual obligation to deliver the securities or foreign currency
underlying the contract at a specified price on a specified date during a
specified future month. To the extent that a Fund invests in futures contracts
and options thereon for other than bona fide hedging purposes, the Fund will not
enter into such transactions if, immediately thereafter, the sum of the amount
of initial margin deposits and premiums paid for open futures options would
exceed 5% of such Fund's total assets, after taking into account unrealized
profits and unrealized losses on such contracts it has entered into; provided,
however, that, in the case of an option that is in-the-money at the time of
purchase, the in-the-money amount may be excluded in calculating the 5%.

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Each Fund may also purchase and write options to buy or sell futures
contracts. Options on futures are similar to options on securities 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. When a Fund enters into a futures transaction, it must
deliver to the futures commission merchant selected by the Fund an amount
referred to as "initial margin." This amount is maintained by the futures
commission merchant directly or on its behalf in an account at the Custodian
Bank. Thereafter, a "variation margin" may be paid by the Fund to, or drawn by
the Fund from, such account in accordance with controls set for such accounts,
depending upon changes in the price of the underlying securities subject to the
futures contract.

To the extent that interest or exchange rates or securities prices move
in an unexpected direction, a Fund may not achieve the anticipated benefits of
investing in futures contracts and options thereon, or may realize a loss. To
the extent that a Fund 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 could prevent the
Fund from closing out its positions relating to futures.

-36-

<PAGE>

APPENDIX A--RATINGS

General Rating Information

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.

-37-

Delaware Investments includes funds -----------------------------------------
with a wide range of investment objectives. Stock
funds, income funds, national and state-specific
tax-exempt funds, money market funds, global NEW EUROPE FUND
and international funds and closed-end funds give LATIN AMERICA FUND
investors the ability to create a portfolio that fits
their personal financial goals. For more -----------------------------------------
information, shareholders of the Fund Classes
should contact their financial adviser or call
Delaware Investments at 800-523-1918. A CLASS
B CLASS
C CLASS
-----------------------------------------

INVESTMENT MANAGER
Delaware International Advisers Ltd.
80 Cheapside
Third Floor
London, England EC2V 6EE

P R O S P E C T U S

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

DECEMBER 23, 1998
NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
1818 Market Street
Philadelphia, PA 19103

SHAREHOLDER SERVICING,
DIVIDEND DISBURSING,
ACCOUNTING SERVICES
AND TRANSFER AGENT
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103

LEGAL COUNSEL
Stradley, Ronon, Stevens & Young, LLP
One Commerce Square
Philadelphia, PA 19103

INDEPENDENT AUDITORS
Ernst & Young LLP
Two Commerce Square
Philadelphia, PA 19103

CUSTODIAN [GRAPHIC OMITTED]
The Chase Manhattan Bank
4 Chase Metrotech Center
Brooklyn, NY 11245

</TABLE>

<PAGE>

NEW EUROPE FUND PROSPECTUS
LATIN AMERICA FUND DECEMBER 23, 1998

A CLASS SHARES
B CLASS SHARES
C CLASS SHARES

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

1818 Market Street, Philadelphia, PA 19103

For Prospectus and Performance: Nationwide 800-523-1918

Information on Existing Accounts: (SHAREHOLDERS ONLY)
Nationwide 800-523-1918

Dealer Services: (BROKER/DEALERS ONLY)
Nationwide 800-362-7500

Representatives of Financial Institutions:
Nationwide 800-659-2265

The Funds offer three retail classes of shares: "Class A Shares,"
"Class B Shares" and "Class C Shares" (individually, a "Class" and collectively,
the "Classes").

This Prospectus relates only to the Classes and sets forth information
that you should read and consider before you invest. Please retain it for future
reference. The Funds' Statement of Additional Information ("Part B" of Global
Funds, Inc.'s registration statement), dated December 23, 1998, as it may be
amended from time to time, contains additional information about the Funds and
has been filed with the Securities and Exchange Commission (the "SEC"). Part B
is incorporated by reference into this Prospectus and is available, without
charge, by writing to Delaware Distributors, L.P. at the above address or by
calling the above numbers. The Funds' financial statements will appear in the
Annual Report of Global Funds, Inc. and will accompany any response to requests
for Part B. In addition, the SEC maintains a Web site (http://www.sec.gov) that
contains

-2-

<PAGE>

Part B, material incorporated by reference into Global Funds, Inc.'s
registration statement, and other information regarding registrants that
electronically file with the SEC.

Each Fund also offers an Institutional Class, which is available for
purchase only by certain investors. A prospectus for each Fund's Institutional
Class can be obtained by writing to Delaware Distributors, L.P. at the above
address or by calling the above numbers.

TABLE OF CONTENTS

Page Page
---- ----
Cover Page How to Buy Shares
Synopsis Redemption and Exchange
Summary of Expenses Dividends and Distributions
Investment Objectives and Strategies Taxes
Suitability Calculation of Offering Price and
Investment Strategy Net Asset Value Per Share
Special Risk Considerations Management of the Funds
The Delaware Difference Other Investment Policies and
Plans and Services Risk Considerations
Classes of Shares Appendix A - Ratings

-3-

<PAGE>

SYNOPSIS

Investment Objectives

The investment objective of each Fund is to achieve long-term capital
appreciation. New Europe seeks to achieve its objective by investing primarily
in equity securities of European countries. Latin America seeks to achieve
its objective by investing primarily in equity securities of Latin American
companies.

Risk Factors and Special Considerations
Prospective investors should consider a number of factors:

-4-

<PAGE>

Investment Manager, Distributor and Service Agent

Delaware International Advisers Ltd. ("Delaware International" or the
"Manager") furnishes investment management services to the Funds, subject to the
supervision of Global Funds, Inc.'s Board of Directors. Delaware Distributors,
L.P. (the "Distributor") is the national distributor for the Funds and for all
of the other mutual funds that are part of Delaware Investments. Delaware
Service Company, Inc. (the "Transfer Agent") is the shareholder servicing,
dividend disbursing, accounting services and transfer agent for the Funds and
for all of the other funds that are part of Delaware Investments See Summary of
Expenses and Management of the Fund for further information regarding the
Manager and the fees payable under the Funds' Investment Management Agreements.

Sales Charges
The price of Class A Shares of each Fund includes a maximum front-end
sales charge of 5.75% of the offering price. The sales charge is reduced on
certain transactions of at least $50,000 but under $1,000,000. For purchases of
$1,000,000 or more, the front-end sales charge is eliminated; if a dealer
commission is paid in connection with those purchases, a limited contingent
deferred sales charge ("Limited CDSC") of 1% will be imposed if shares are
redeemed during the first year after the purchase and 0.50% will be imposed if
shares are redeemed during the second year after purchase. See Contingent
Deferred Sales Charge for Certain Redemption of Class A Shares Purchased at Net
Asset Value under Redemption and Exchange. Class A Shares are subject to annual
12b-1 Plan expenses for the life of the investment.

The price of Class B Shares of each Fund is equal to the net asset
value per share. Class B Shares are subject to a CDSC of: (i) 5% if shares are
redeemed within one year of purchase; (ii) 4% if shares are redeemed during the
second year of purchase; (iii) 3% if shares are redeemed during the third or
fourth year following purchase; (iv) 2% if shares are redeemed during the fifth
year following purchase; (v) 1% if shares are redeemed during the sixth year
following purchase; and (vi) 0% thereafter. Class B Shares are subject to annual
12b-1 Plan expenses for approximately eight years after purchase.

The price of Class C Shares of each Fund is equal to the net asset
value per share. Class C Shares are subject to a CDSC of 1% if shares are
redeemed within 12 months of purchase. Class C Shares are subject to annual
12b-1 Plan expenses for the life of the investment.

See Classes of Shares and Distribution (12b-1) and Service under
Management of the Funds.

-5-

<PAGE>

Purchase Amounts
Generally, the minimum initial investment in any Class is $1,000.
Subsequent investments generally must be at least $100.

Each purchase of Class B Shares is subject to a maximum purchase
limitation of $250,000. For Class C Shares, each purchase must be in an amount
that is less than $1,000,000. An investor may exceed these maximum purchase
limitations for Class B Shares and Class C Shares by making cumulative purchases
over a period of time. An investor should keep in mind, however, that reduced
front-end sales charges apply to investments of $50,000 or more in Class A
Shares, and that Class A Shares are subject to lower annual 12b-1 Plan expenses
than Class B and Class C Shares and generally are not subject to a CDSC. The
minimum and maximum purchase amounts for retirement plans may vary. See How to
Buy Shares.

Redemption and Exchange
Class A Shares may be redeemed or exchanged at the net asset value
calculated after receipt of the redemption or exchange request. Neither the
Funds nor the Distributor assesses a charge for redemptions or exchanges of
Class A Shares, except for certain redemptions of shares purchased at net asset
value, which may be subject to a Limited CDSC if a dealer's commission was paid
in connection with such purchases. See Front-End Sales Charge Alternative -
Class A Shares under Classes of Shares.

Class B Shares and Class C Shares may be redeemed or exchanged at the
net asset value calculated after receipt of the redemption or exchange request
subject, in the case of redemptions, to any applicable CDSC. Neither the Funds
nor the Distributor assesses any charges other than the CDSC for redemptions or
exchanges of Class B or Class C Shares. There are certain limitations on an
investor's ability to exchange shares between the various classes of shares that
are offered. See Redemption and Exchange.

Open-End Investment Company Global Funds, Inc. is an open-end,
registered management investment company. Each Fund operates as a diversified
fund as defined under the Investment Company Act of 1940 (the "1940 Act").
Global Funds, Inc. was organized as a Maryland corporation on May 30, 1991. See
Shares under Management of the Funds.

-6-

<PAGE>

SUMMARY OF EXPENSES

A general comparison of the sales arrangements and other expenses
applicable to Class A, Class B and Class C Shares for each Fund follows:

New Europe Fund Latin America Fund
Class A Class B Class C Class A Class B Class C
Shareholder Transaction Expenses Shares Shares Shares Shares Shares Shares
- ------------------------------------------------------------------------------------------------------------------------------------
Maximum Sales Charge Imposed
on Purchases (as a percentage
of offering price).......................... 5.75% None None 5.75% None None

Maximum Sales Charge Imposed
on Reinvested Dividends (as a
percentage of offering price)............... None None None None None None

Maximum Contingent Deferred
Sales Charge (as a percentage of
original purchase price or redemption
proceeds, as applicable).................... None(1) 5.00%(1) 1.00%(1) None(1) 5.00%(1) 1.00%(1)

Redemption Fees............................. None(2) None(2) None(2) None(2) None(2) None(2)

(1) Class A purchases of $1,000,000 or more may be made at net asset value. However, if in connection
with any such purchase a dealer commission is paid to the financial adviser through whom such
purchase is effected, a Limited CDSC of 1% will be imposed on certain redemptions made during the
first year after the purchase and a Limited CDSC of 0.50% will be imposed on certain redemptions
made during the second year after purchase. Additional Class A purchase options involving the
imposition of a CDSC may be permitted as described in the Prospectus from time to time. Class B
Shares are subject to a CDSC of: (i) 5% if shares are redeemed within one year of purchase; (ii) 4% if
shares are redeemed during the second year of purchase; (iii) 3% if shares are redeemed during the third
or fourth year following purchase; (iv) 2% if shares are redeemed during the fifth year following
purchase; (v) 1% if shares are redeemed during the sixth year following purchase; and (vi) 0%
thereafter. Class C Shares are subject to a CDSC of 1% if the shares are redeemed within 12 months of
purchase. See Contingent Deferred Sales Charge for Certain Redemptions of Class A Shares
Purchased at Net Asset Value under Redemption and Exchange; and Deferred Sales Charge Alternative
- Class B Shares, Level Sales Charge Alternative - Class C Shares and Contingent Deferred Sales
Charge - Class B Shares and Class C Shares under Classes of Shares.
(2) First Union National Bank currently charges $7.50 per redemption for redemptions payable by wire.
</TABLE>

-7-

<PAGE>

Annual Operating Expenses New Europe Fund Latin America Fund
(as a percentage of average Class A Class B Class C Class A Class B Class C
daily net assets) Shares Shares Shares Shares Shares Shares
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
Management Fees
(after voluntary waivers).............. 0.00%(2) 0.00%(2) 0.00%(2) 0.00%(2) 0.00%(2) 0.00%(2)

12b-1 Expenses (including service fees)
(after voluntary waivers).............. 0.00%(1)(2) 0.00%(1)(2) 0.00%(1)(2) 0.00%(1)(2) 0.00%(1) (2)0.00%(1)(2)

Other Operating Expenses
(after voluntary payments)............. 1.25%(2) 1.25%(2) 1.25%(2) 1.25%(2) 1.25%(2) 1.25%(2)
----- ----- ----- ----- ----- -----

Total Operating Expenses
(after voluntary waivers and payments).... 1.25%(2) 1.25%(2) 1.25%(2) 1.25%(2) 1.25%(2) 1.25%(2)
===== ===== ===== ===== ===== =====
</TABLE>

(1) Class A Shares, Class B Shares and Class C Shares are subject to
separate 12b-1 Plans. Long-term shareholders may pay more than the
economic equivalent of the maximum front-end sales charges permitted
by rules of the National Association of Securities Dealers, Inc. (the
"NASD"). The Distributor has elected voluntarily to waive its right to
receive 12b-1 Plan fees (including service fees) from the commencement
of the public offering of the Classes through June 30, 1999. In the
absence of those waivers, 12b-1 Plan expenses would equal 0.25% (no
more than 0.30% as set by the Board) for Class A Shares and 1.00% for
each of the Class B Shares and Class C Shares. See Distribution
(12b-1) and Service under Management of the Fund.

(2) Because the New Europe and Latin America Funds are new Funds, "Total
Operating Expenses" and "Other Operating Expenses" for each Class of
shares are based on estimated amounts each Fund expects to pay during
the initial fiscal year. As noted above, the Distributor has elected
voluntarily to waive 12b-1 Plan expenses through June 30, 1999. Also,
the Manager has elected voluntarily to waive that portion, if any, of
the annual management fees payable by each Fund and to pay certain
expenses of the Funds to the extent necessary to ensure that each
Fund's Total Operating Expenses (exclusive of 12b-1 Plan fees, taxes,
interest, brokerage commissions and extraordinary expenses) do not
exceed, on an annualized basis, 1.25% of the average daily net assets
of each Fund. The Manager's voluntary fee waivers and expense payments
began at the commencement of the public offering of the Classes and
will extend through June 30, 1999. Absent the Manager's voluntary fee
waiver and expense payments (and the Distributor's voluntary waiver of
the 12b-1 Plan fees for each class), it is estimated that during the
current fiscal year, the Total Operating Expenses, as a percentage of
average daily net assets, would be 2.20%, 2.95% and 2.95%,
respectively, for Class A Shares, Class B Shares and Class C. Shares
of New Europe Fund, and 2.27%, 3.02% and 3.02%, respectively, for
Class A Shares, Class B Shares and Class C Shares of Latin America
Fund, reflecting "Management Fees" of 1.25% in all cases.

-8-

<PAGE>

For expense information about each Fund's Institutional Class of
shares, see the separate prospectus relating to that class.

Investors utilizing the Asset Planner asset allocation service also
typically incur an annual maintenance fee of $35 per Strategy. However, the
annual maintenance fee is being waived until further notice. Investors who
utilize the Asset Planner for an Individual Retirement Plan ("IRA") will pay an
annual IRA fee of $15 per Social Security Number. See Part B.

The following example illustrates the expenses that an investor would
pay on a $1,000 investment over various time periods, assuming (1) a 5% annual
rate of return, (2) redemption and no redemption at the end of each time period
and (3) for Class B Shares and Class C Shares, payment of a CDSC at the time of
redemption, if applicable. The following example also reflects the voluntary
waiver of the management fee and payment of expenses by the Manager and the
waiver of the 12b-1 Plan fees by the Distributor as discussed in this
Prospectus.

<TABLE>
<CAPTION>
New Europe Fund
Assuming Redemption Assuming No Redemption

<S> <C> <C> <C> <C>
1 year 3 years 1 year 3 years
------ ------- ------ -------
Class A Shares $70(1) $95 $70 $95
Class B Shares(2) $63 $70 $13 $40
Class C Shares $23 $40 $13 $40

Latin America Fund
Assuming Redemption Assuming No Redemption

1 year 3 years 1 year 3 years
------ ------- ------ -------
Class A Shares $70(1) $95 $70 $95
Class B Shares(2) $63 $70 $13 $40
Class C Shares $23 $40 $13 $40

</TABLE>

(1) Generally, no redemption charge is assessed upon redemption of Class A
Shares. Under certain circumstances, however, a Limited CDSC or other
CDSC, which has not been reflected in this calculation, may be imposed
on certain redemptions. See Contingent Deferred Sales Charge for
Certain Redemptions of Class A Shares Purchased at Net Asset Value
under Redemption and Exchange.
(2) At the end of approximately eight years after purchase, Class B Shares
will be automatically converted into Class A Shares. The example above
does not assume conversion of Class B Shares since it reflects figures
only for one and three years. See Automatic Conversion of Class B
Shares under Classes of Shares for a description of the automatic
conversion feature.

This example should not be considered a representation of past or future
expenses or performance. Actual expenses may be greater or less than those
shown.

The purpose of the above tables is to assist the investor in
understanding the various costs and expenses that an investor in each Class will
bear directly or indirectly.

-9-
<PAGE>

INVESTMENT OBJECTIVES AND STRATEGIES

SUITABILITY
Investors considering either Fund should have a long-term investment
time frame.

* * *

Ownership of shares of the Funds can reduce the bookkeeping and
administrative inconvenience that is typically connected with direct purchases
of the type of securities in which the Funds invest.

-10-

<PAGE>

-11-

<PAGE>

-12-

<PAGE>

which would adversely affect their ability to service principal and interest
payment obligations, to meet projected 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 a Fund's net
asset value per share.

* * *

-13-

<PAGE>

financial statements of a developing or emerging country issuer may not reflect
its financial position or results of operations in the way they would be
reflected had the financial statements been prepared in accordance with the
United States' generally accepted accounting principles. Also, for an issuer
that keeps accounting records in local currency, inflation accounting rules may
require for both tax and accounting purposes, that certain assets and
liabilities be restated on the issuer's balance sheet in order to express items
in terms of currency or constant purchasing power. Inflation accounting may
indirectly generate losses or profits. Consequently, financial data may be
materially affected by restatements for inflation and may not accurately reflect
the real condition of those issuers and securities markets.

Each of the Funds has the ability to invest in emerging market
securities. With respect to the New Europe Fund, most Eastern European countries
are considered emerging markets. Further, with respect to the Latin America
Fund, virtually all Latin American countries are underdeveloped or emerging. Set
forth below are some specific risk factors related to Eastern Europe and Latin
American issuers.

-14-

<PAGE>

-15-

<PAGE>

improvements in recent years, the Latin American economies continue to
experience significant problems, including high inflation rates and high
interest rates. The emergence of the Latin American economies and securities
markets will require continued economic and fiscal discipline which has been
lacking at times in the past, as well as stable political and social conditions.
Recovery may also be influenced by international economic conditions,
particularly those in the United States, and by world prices for oil and other
commodities. There is no assurance that the economic initiatives will be
successful.

-16-

<PAGE>

with limited exceptions, invested capital cannot be repatriated for three years.
The Latin America Fund could be adversely affected by delays in, or a refusal to
grant, any required governmental approval for repatriation of capital, as well
as by the application to the Fund of any restrictions on investments.

Certain Latin American countries are among the largest debtors to
commercial banks and foreign governments.

-17-

<PAGE>

the past experienced substantial difficulties in servicing their external debt
obligations, which have led to defaults on certain obligations and the
restructuring of certain indebtedness. Restructuring arrangements have included,
among other things, reducing and rescheduling interest and principal payments by
negotiating new or amended credit agreements or converting outstanding principal
and unpaid interest to Brady Bonds, and obtaining new credit to finance interest
payments. Holders of certain foreign government and government-related high
yield securities may be requested to participate in the restructuring of such
obligations and to extend further loans to their issuers. There can be no
assurance that the Brady Bonds and other foreign government and
government-related high yield securities in which the Funds may invest will not
be subject to similar defaults or restructuring arrangements which may adversely
affect the value of such investments. Furthermore, certain participants in the
secondary market for such debt may be directly involved in negotiating the terms
of these arrangements and may therefore have access to information not available
to other market participants.

-18-

<PAGE>

* * *

-19-

<PAGE>

THE DELAWARE DIFFERENCE

PLANS AND SERVICES
The Delaware Difference is our commitment to provide you with superior
information and quality service on your investments in Delaware Investments.

SHAREHOLDER PHONE DIRECTORY

Shareholder Service Center and Investor Information Center

800-523-1918
Information on Existing Regular Investment Accounts and
Retirement Plan Accounts; Wire Investments; Wire Liquidations;
Telephone Liquidations and Telephone Exchanges;Fund
Information; Literature; Price; Yield and Performance Figures

Delaphone
800-362-FUND
(800-362-3863)

Performance Information
During business hours, you can call the Investor Information Center for
current performance information. Current yield and total return information may
also be included in advertisements and information given to shareholders. Yields
are computed on an annual basis over a 30-day period.

Shareholder Services
During business hours, you can call Delaware Investments' Shareholder
Service Center. Our representatives can answer any questions about your account,
the Funds, various service features and other funds offered by Delaware
Investments.

Automated Shareholder Services
You can purchase, redeem or exchange shares through Delaphone, Delaware
Investments' automated telephone system, or through Delaware Investments' Web
site, www.delawarefunds.com. For more information about how to sign up for these
services, call the Shareholder Service Center.

Dividend Payments
Dividends, capital gains and other distributions, if any, are
automatically reinvested in your account. You may also elect to have the
dividends earned in one fund automatically invested in another Delaware
Investments fund with a different investment objective, subject to certain
exceptions and limitations.

For more information, see Additional Methods of Adding to Your
Investment - Dividend Reinvestment Plan under How to Buy Shares or call the
Shareholder Service Center.

Statements and Confirmations
You will receive quarterly statements of your account summarizing all
transactions during the period. A confirmation statement will be sent following
all transactions, other than those involving a reinvestment of dividends. You
should examine statements and confirmations immediately and promptly report any
discrepancy by calling the Shareholder Service Center.

-20-

<PAGE>

Duplicate Confirmations
If your financial adviser or investment dealer is noted on your
investment application, we will send a duplicate confirmation to him or her.
This makes it easier for your adviser to help you manage your investments.

Tax Information
Each year, Global Funds, Inc. will mail to you information on the tax
status of your dividends and distributions.

Retirement Planning
An investment in any Fund may be a suitable investment option for
tax-deferred retirement plans. Delaware Investments offers a full spectrum of
qualified and non-qualified retirement plans, including the popular 401(k)
deferred compensation plan, IRA, and the new Roth IRA. Please call Delaware
Investments at 800-523-1918 for more information.

Right of Accumulation
With respect to Class A Shares, the Right of Accumulation feature
allows you to combine the value of your current holdings of Class A Shares,
Class B Shares and Class C Shares of a Fund with the dollar amount of new
purchases of Class A Shares of the Fund to qualify for a reduced front-end sales
charge on such purchases of Class A Shares. Under the Combined Purchases
Privilege, you may also include certain shares that you own in other funds
offered by Delaware Investments. See Classes of Shares.

Letter of Intention
The Letter of Intention feature permits you to obtain a reduced
front-end sales charge on purchases of Class A Shares by aggregating certain of
your purchases of Delaware Investments fund shares over a 13-month period. See
Classes of Shares and Part B.

12-Month Reinvestment Privilege
The 12-Month Reinvestment Privilege permits you to reinvest proceeds
from a redemption of Class A Shares, within one year of the date of the
redemption, without paying a front-end sales charge. See Part B.

Exchange Privilege
The Exchange Privilege permits you to exchange all or part of your
shares into shares of other mutual funds offered by Delaware Investments,
subject to certain exceptions and limitations. For additional information on
exchanges, see Investing by Exchange under How to Buy Shares and Redemption and
Exchange.

Wealth Builder Option
You may elect to invest in a Fund through regular liquidations of
shares in your accounts in other funds that are part of Delaware Investments.
Investments under this feature are exchanges and are therefore subject to the
same conditions and limitations as other exchanges of Fund shares. See
Additional Methods of Adding to Your Investment - Wealth Builder Option and
Investing by Exchange under How to Buy Shares, and Redemption and Exchange.

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<PAGE>

Financial Information about the Funds
Each fiscal year, you will receive an audited annual report and an
unaudited semi-annual report. These reports provide detailed information about
each Fund's investments and performance. Global Funds, Inc.'s fiscal year ends
on November 30.

-22-

<PAGE>

CLASSES OF SHARES

Alternative Purchase Arrangements
Shares may be purchased at a price equal to the next determined net
asset value per share, subject to a sales charge which may be imposed, at the
election of the purchaser, at the time of the purchase for Class A Shares
("front-end sales charge alternative"), or on a contingent deferred basis for
Class B Shares ("deferred sales charge alternative") or Class C Shares ("level
sales charge alternative").

Class A Shares. An investor who elects the front-end sales charge
alternative acquires Class A Shares, which incur a sales charge when they are
purchased, but generally are not subject to any sales charge when they are
redeemed. Absent any applicable fee waiver, Class A Shares are subject to annual
12b-1 Plan expenses of up to a maximum of 0.30% (no more than 0.25% as currently
set by the Board) of average daily net assets of such shares. Certain purchases
of Class A Shares qualify for reduced front-end sales charges. See Front-End
Sales Charge Alternative - Class A Shares, below. See also Contingent Deferred
Sales Charge for Certain Redemptions of Class A Shares Purchased at Net Asset
Value under Redemption and Exchange and Distribution (12b-1) and Service under
Management of the Funds.

Class B Shares. An investor who elects the deferred sales charge
alternative acquires Class B Shares, which do not incur a front-end sales charge
when they are purchased, but are subject to a contingent deferred sales charge
if they are redeemed within six years of purchase. Absent any applicable fee
waiver, Class B Shares are subject to annual 12b-1 Plan expenses of up to a
maximum of 1% (0.25% of which are service fees to be paid to the Distributor,
dealers or others for providing personal service and/or maintaining shareholder
accounts) of average daily net assets of such shares for approximately eight
years after purchase. Class B Shares permit all of the investor's dollars to
work from the time the investment is made. If no waiver of 12b-1 fees is in
effect, the higher 12b-1 Plan expenses paid by Class B Shares will cause such
shares to have a higher expense ratio and to pay lower dividends than Class A
Shares. At the end of approximately eight years after purchase, Class B Shares
automatically will be converted into Class A Shares and, thereafter, for the
remainder of the life of the investment, the annual 12b-1 Plan fee of up to
0.30% (no more than 0.25% as currently set by the Board) for Class A Shares will
apply. See Automatic Conversion of Class B Shares, below.

Class C Shares. An investor who elects the level sales charge
alternative acquires Class C Shares, which do not incur a front-end sales charge
when they are purchased, but are subject to a contingent deferred sales charge
if they are redeemed within 12 months of purchase. Absent any applicable fee
waiver, Class C Shares are subject to annual 12b-1 Plan expenses of up to a
maximum of 1% (0.25% of which are service fees to be paid to the Distributor,
dealers or others for providing personal service and/or maintaining shareholder
accounts) of average daily net assets of such shares for the life of the
investment. If no waiver of 12b-1 fees is in effect, the higher 12b-1 Plan
expenses paid by Class C Shares will cause such shares to have a higher expense
ratio and to pay lower dividends than Class A Shares. Unlike Class B Shares,
Class C Shares do not convert to another class.

The alternative purchase arrangements described above permit investors
to choose the method of purchasing shares that is most suitable given the amount
of their purchase, the length of time they expect to hold their shares and other
relevant circumstances. Investors should determine whether, given their
particular circumstances, it is more advantageous to purchase Class A Shares and
incur a front-end sales charge, purchase Class B Shares and have the entire
initial purchase amount invested in a Fund with their investment being subject
to a CDSC if they redeem shares within six years of purchase, or purchase Class
C Shares and have the entire initial purchase amount invested in a Fund with
their investment being subject to a CDSC if they redeem

-23-

<PAGE>

shares within 12 months of purchase. In addition, investors should consider the
level of annual 12b-1 Plan expenses applicable to each Class. If no waiver of
12b-1 fees is in effect, the higher 12b-1 Plan expenses on Class B Shares and
Class C Shares will be offset to the extent a return is realized on the
additional money initially invested upon the purchase of such shares. However,
there can be no assurance as to the return, if any, that will be realized on
such additional money. In addition, the effect of any return earned on such
additional money will diminish over time. In comparing Class B Shares to Class C
Shares, investors should also consider the duration of the annual 12b-1 Plan
expenses to which each of the Classes is subject and the desirability of an
automatic conversion feature, which is available only for Class B Shares.

For the distribution and related services provided to, and the expenses
borne on behalf of, a Fund, absent any applicable fee waiver, the Distributor
and others will be paid, in the case of Class A Shares, from the proceeds of the
front-end sales charge and 12b-1 Plan fees and, in the case of Class B Shares
and Class C Shares, from the proceeds of the 12b-1 Plan fees and, if applicable,
the CDSC incurred upon redemption. Financial advisers may receive different
compensation for selling Class A Shares, Class B Shares and Class C Shares.
Investors should understand that the purpose and function of the respective
12b-1 Plans and the CDSCs applicable to Class B Shares and Class C Shares are
the same as those of the 12b-1 Plan and the front-end sales charge applicable to
Class A Shares in that such fees and charges are used to finance the
distribution of the respective Classes. See Distribution (12b-1) and Service
under Management of the Funds.

Dividends, if any, paid on Class A Shares, Class B Shares and Class C
Shares will be calculated in the same manner, at the same time, and on the same
day and will be in the same amount, except that, when assessed, the additional
amount of 12b-1 Plan expenses relating to Class B Shares and Class C Shares will
be borne exclusively by such shares. See Calculation of Offering Price and Net
Asset Value Per Share.

The NASD has adopted certain rules relating to investment company sales
charges. Global Funds, Inc. and the Distributor intend to operate in compliance
with these rules.

Front-End Sales Charge Alternative - Class A Shares
Class A Shares of either Fund may be purchased at the offering price,
which reflects a maximum front-end sales charge of 5.75%. See Calculation of
Offering Price and Net Asset Value Per Share.

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<PAGE>

Purchases of $50,000 or more carry a reduced front-end sales charge as
shown in the following table.

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

Dealer's
Commission***
Front-end Sales Charge as % of as % of
Amount of Purchase Offering Amount Offering
Price Invested** Price
- -------------------------------------------------------------------------------------------------------------------

New Latin
Europe America
<S> <C> <C> <C> <C>
Less than $50,000 5.75% 6.12% 6.12% 5.00%
$50,000 but under $100,000 4.75 4.94 4.94 4.00
$100,000 but under $250,000 3.75 3.88 3.88 3.00
$250,000 but under $500,000 2.50 2.59 2.59 2.00
$500,000 but under $1,000,000* 2.00 2.00 2.00 1.60
</TABLE>

* There is no front-end sales charge on purchases of Class A Shares of
$1,000,000 or more but, under certain limited circumstances, a 1%
Limited CDSC may apply upon redemption of such shares made during the
first year after the purchase and a 0.50% Limited CDSC may apply upon
redemption of such shares made during the second year after the
purchase.
** Based on the initial net asset value of $8.50 per share of New Europe
Fund and Latin America Fund Class A shares.
*** Financial institutions or their affiliated brokers may receive an
agency transaction fee in the percentages set forth above.
- --------------------------------------------------------------------------------

The Fund must be notified when a sale takes place which would qualify
for the reduced front-end sales charge on the basis of previous or
current purchases. The reduced front-end sales charge will be granted
upon confirmation of the shareholder's holdings by the Fund. Such
reduced front-end sales charges are not retroactive.

From time to time, upon written notice to all of its dealers, the
Distributor may hold special promotions for specified periods during
which the Distributor may reallow to dealers up to the full amount of
the front-end sales charge shown above. In addition, certain dealers
who enter into an agreement to provide extra training and information
on Delaware Investments products and services and who increase sales of
Delaware Investments funds may receive an additional commission of up
to 0.15% of the offering price. Dealers who receive 90% or more of the
sales charge may be deemed to be underwriters under the 1933 Act.
- --------------------------------------------------------------------------------

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<PAGE>

For initial purchases of Class A Shares of $1,000,000 or more, a
dealer's commission may be paid by the Distributor to financial advisers through
whom such purchases are made in accordance with the following schedule:

Dealer's Commission
(as a percentage of
Amount of Purchase amount purchased)
- ------------------ -----------------
Up to $5 million 1.00%
Next $20 million up to $25 million 0.50
Amount over $25 million 0.25

Such Class A Shares are subject to a Limited CDSC of 1% if Shares are
redeemed during the first year after purchase and 0.5% if Shares are redeemed
during the second year of purchase.

For accounts with assets over $1,000,000, the dealer commission resets
annually to the highest incremental commission rate on the anniversary of the
first purchase. In determining a financial adviser's eligibility for the
dealer's commission, purchases of Class A Shares of other Delaware Investments
funds as to which a Limited CDSC applies may be aggregated with those of Class A
Shares of the Fund. Financial advisers also may be eligible for a dealer's
commission in connection with certain purchases made under a Letter of Intention
or pursuant to an investor's Right of Accumulation. Financial advisers should
contact the Distributor concerning the applicability and calculation of the
dealer's commission in the case of combined purchases.

An exchange from other Delaware Investments funds will not qualify for
payment of the dealer's commission, unless a dealer's commission or similar
payment has not been previously paid on the assets being exchanged. The schedule
and program for payment of the dealer's commission are subject to change or
termination at any time by the Distributor at its discretion.

Redemptions of Class A Shares purchased at net asset value may result
in the imposition of a Limited CDSC if the dealer's commission described above
was paid in connection with the purchase of those shares. See Contingent
Deferred Sales Charge for Certain Redemptions of Class A Shares Purchased at Net
Asset Value under Redemption and Exchange.

Combined Purchases Privilege
By combining your holdings of Class A Shares with your holdings of
Class B Shares and/or Class C Shares of a particular Fund and shares of the
other funds offered by Delaware Investments, except as noted below, you can
reduce the front-end sales charges on any additional purchases of Class A
Shares. Shares of Delaware Group Premium Fund, Inc. beneficially owned in
connection with ownership of variable insurance products may be combined with
other Delaware Investments fund holdings. In addition, assets held by investment
advisory clients of the Manager or its affiliates in any stable value account
may be combined with other Delaware Investment fund holdings. Shares of other
funds that do not carry a front-end sales charge or CDSC may not be included
unless they were acquired through an exchange from a Delaware Investments fund
that does carry a front-end sales charge or CDSC.

This privilege permits you to combine your purchases and holdings with
those of your spouse, your children under 21 and any trust, fiduciary or
retirement account for the benefit of such family members. It also permits you
to use these combinations under a Letter of Intention. A Letter of Intention
allows you to make

-26-

<PAGE>

purchases over a 13-month period and qualify the entire purchase for a reduction
in front-end sales charges on Class A Shares.

Combined purchases of $1,000,000 or more, including certain purchases
made at net asset value pursuant to a Right of Accumulation or under a Letter of
Intention, may result in the payment of a dealer's commission and the
applicability of a Limited CDSC. Investors should consult their financial
advisers or the Shareholder Service Center about the operation of these
features. See Front-End Sales Charge Alternative Class A Shares, above.

Allied Plans
Class A Shares are available for purchase by participants in certain
401(k) Defined Contribution Plans ("Allied Plans") which are made available
under a joint venture agreement between the Distributor and another institution
through which mutual funds are marketed and which allow investments in Class A
Shares of designated Delaware Investments funds ("eligible Delaware Investments
fund shares"), as well as shares of designated classes of non-Delaware
Investments funds ("eligible non-Delaware Investments fund shares"). Class B
Shares and Class C Shares are not eligible for purchase by Allied Plans.

With respect to purchases made in connection with an Allied Plan, the
value of eligible Delaware Investments and eligible non-Delaware Investments
fund shares held by the Allied Plan may be combined with the dollar amount of
new purchases by that Allied Plan to obtain a reduced front-end sales charge on
additional purchases of eligible Delaware Investments fund shares.

Participants in Allied Plans may exchange all or part of their eligible
Delaware Investments shares for other eligible Delaware Investments fund shares
or for eligible non-Delaware Investments fund shares at net asset value without
payment of a front-end sales charge. However, exchanges of eligible fund shares,
both Delaware Investments and non-Delaware Investments, which were not subject
to a front-end sales charge, will be subject to the applicable sales charge if
exchanged for eligible Delaware Investments fund shares to which a sales charge
applies. No sales charge will apply if the eligible fund shares were previously
acquired through the exchange of eligible shares on which a sales charge was
already paid or through the reinvestment of dividends.
See Investing by Exchange.

A dealer's commission may be payable on purchases of eligible Delaware
Investments fund shares under an Allied Plan. In determining a financial
adviser's eligibility for a dealer's commission on net asset value purchases of
eligible Delaware Investments fund shares in connection with Allied Plans, all
participant holdings in the Allied Plan will be aggregated.

The Limited CDSC is applicable to redemptions of net asset value
purchases from an Allied Plan on which a dealer's commission has been paid.
Waivers of the Limited CDSC, as described under Waiver of Limited Contingent
Deferred Sales Charge - Class A Shares under Redemption and Exchange, apply to
redemptions by participants in Allied Plans except in the case of exchanges
between eligible Delaware Investments and non-Delaware Investments fund shares.
When eligible Delaware Investments fund shares are exchanged into eligible
non-Delaware Investments fund shares, the Limited CDSC will be imposed at the
time of the exchange, unless the joint venture agreement specifies that the
amount of the Limited CDSC will be paid by the financial adviser or selling
dealer. See Contingent Deferred Sales Charge for Certain Redemptions of Class A
Shares Purchased at Net Asset Value under Redemption and Exchange.

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<PAGE>

Buying Class A Shares at Net Asset Value
Class A Shares of a Fund may be purchased at net asset value under the
Delaware Investments Dividend Reinvestment Plan and, under certain
circumstances, the Exchange Privilege or the 12-Month Reinvestment Privilege.
See The Delaware Difference and Redemption and Exchange for additional
information.

Purchases of Class A Shares may be made at net asset value by current
and former officers, directors and employees (and members of their families) of
the Manager, any affiliate, any of the funds offered by Delaware Investments,
certain of their agents and registered representatives and employees of
authorized investment dealers and by employee benefit plans for such entities.
Individual purchases, including those in retirement accounts, must be for
accounts in the name of the individual or a qualifying family member.

Purchases of Class A Shares may also be made by clients of registered
representatives of an authorized investment dealer at net asset value within 12
months after the registered representative changes employment, if the purchase
is funded by proceeds from an investment where a front-end sales charge,
contingent deferred sales charge or other sales charge has been assessed.
Purchases of Class A Shares may also be made at net asset value by bank
employees who provide services in connection with agreements between the bank
and unaffiliated brokers or dealers concerning sales of shares of Delaware
Investments funds. Officers, directors and key employees of institutional
clients of the Manager or any of its affiliates may purchase Class A Shares at
net asset value. Moreover, purchases may be effected at net asset value for the
benefit of the clients of brokers, dealers and registered investment advisers
affiliated with a broker or dealer, if such broker, dealer or investment adviser
has entered into an agreement with the Distributor providing specifically for
the purchase of Class A Shares in connection with special investment products,
such as wrap accounts or similar fee based programs. Investors may be charged a
fee when effecting transactions in Class A Shares through a broker or agent that
offers these special investment products.

Purchases of Class A Shares at net asset value may also be made by the
following: institutions investing for the account of their trust customers if
they are not eligible to purchase shares of the Institutional Class of the
Funds; and any group retirement plan (excluding defined benefit pension plans),
or such plans of the same employer, for which plan participant records are
maintained on the Retirement Financial Services, Inc. (formerly named Delaware
Investment & Retirement Services, Inc.) proprietary record keeping system that
(i) has in excess of $500,000 of plan assets invested in Class A Shares of
Delaware Investments funds and any stable value account available to investment
advisory clients of the Manager or its affiliates, or (ii) is sponsored by an
employer that has at any point after May 1, 1997 had more than 100 employees
while such plan has held Class A Shares of a Delaware Investments fund and such
employer has properly represented to Retirement Financial Services, Inc. in
writing that it has the requisite number of employees and has received written
confirmation back from Retirement Financial Services, Inc. See Group Investment
Plans for information regarding the applicability of the Limited CDSC.

Investments in Class A Shares made by plan level and/or participant
retirement accounts that are for the purpose of repaying a loan taken from such
accounts will be made at net asset value. Loan repayments made to a Delaware
Investments account in connection with loans originated from accounts previously
maintained by another investment firm will also be invested at net asset value.

Investors in Delaware Investments Unit Investment Trusts may reinvest
monthly dividend checks and/or repayment of invested capital into Class A Shares
of any of the funds offered by Delaware Investments at net asset value.

The Fund must be notified in advance that an investment qualifies for
purchase at net asset value.

-28-

<PAGE>

Group Investment Plans
Group Investment Plans (e.g., SEP/IRA, SAR/SEP, SIMPLE IRA, SIMPLE
401(k), Profit Sharing and Money Purchase Pension Plans, 401(k) Defined
Contribution Plans, and 403(b)(7) and 457 Deferred Compensation Plans) may
benefit from the reduced front-end sales charges available on Class A Shares
based on total plan assets. If a company has more than one plan investing in the
Delaware Investments funds, then the total amount invested in all plans will be
aggregated to determine the applicable front-end sales charge reduction on each
purchase, both initial and subsequent, if, at the time of each such purchase,
the company notifies the Fund that it qualifies for the reduction. Employees
participating in such Group Investment Plans may also combine the investments
held in their plan account to determine the front-end sales charge applicable to
purchases in non-retirement Delaware Investments investment accounts if, at the
time of each such purchase, they notify the Fund that they are eligible to
combine purchase amounts held in their plan account.

The Limited CDSC is applicable to any redemptions of net asset value
purchases made on behalf of any group retirement plan on which a dealer's
commission has been paid only if such redemption is made pursuant to a
withdrawal of the entire plan from Delaware Investments funds. See Contingent
Deferred Sales Charge for Certain Redemptions of Class A Shares Purchased at Net
Asset Value under Redemption and Exchange.

For additional information on retirement plans, including plan forms,
applications, minimum investments and any applicable account maintenance fees,
contact your investment dealer or the Distributor.

Deferred Sales Charge Alternative - Class B Shares
Class B Shares may be purchased at net asset value without a front-end
sales charge and, as a result, the full amount of the investor's purchase
payment will be invested in Fund shares. The Distributor currently compensates
dealers or brokers for selling Class B Shares at the time of purchase from its
own assets in an amount equal to no more than 5% of the dollar amount purchased.
In addition, from time to time, upon written notice to all of its dealers, the
Distributor may hold special promotions for specified periods during which the
Distributor may pay additional compensation to dealers or brokers for selling
Class B Shares at the time of purchase. As discussed below, however, absent any
applicable fee waiver, Class B Shares are subject to annual 12b-1 Plan expenses
of up to a maximum of 1% for approximately eight years after purchase and, if
redeemed within six years of purchase, a CDSC.

Proceeds from the CDSC and the annual 12b-1 Plan fees, if any, are paid
to the Distributor and others for providing distribution and related services,
and bearing related expenses, in connection with the sale of Class B Shares.
These payments support the compensation paid to dealers or brokers for selling
Class B Shares. Payments to the Distributor and others under the Class B 12b-1
Plan may be in an amount equal to no more than 1% annually. The combination of
the CDSC and the proceeds of the 12b-1 Plan fees makes it possible for the Fund
to sell Class B Shares without deducting a front-end sales charge at the time of
purchase.

Holders of Class B Shares who exercise the exchange privilege described
below will continue to be subject to the CDSC schedule for Class B Shares
described in this Prospectus, even after the exchange. Such CDSC schedule may be
higher than the CDSC schedule for Class B Shares acquired as a result of the
exchange. See Redemption and Exchange.

Automatic Conversion of Class B Shares
Class B Shares, other than shares acquired through reinvestment of
dividends, held for eight years after purchase are eligible for automatic
conversion into Class A Shares. Conversions of Class B Shares into Class A
Shares will occur only four times in any calendar year, on the last business day
of the second full week of March,

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<PAGE>

June, September and December (each, a "Conversion Date"). If the eighth
anniversary after a purchase of Class B Shares falls on a Conversion Date, an
investor's Class B Shares will be converted on that date. If the eighth
anniversary occurs between Conversion Dates, an investor's Class B Shares will
be converted on the next Conversion Date after such anniversary. Consequently,
if a shareholder's eighth anniversary falls on the day after a Conversion Date,
that shareholder will have to hold Class B Shares for as long as three
additional months after the eighth anniversary of purchase before the shares
will automatically convert into Class A Shares.

Class B Shares of a fund acquired through a reinvestment of dividends
will convert to the corresponding Class A Shares of that fund (or, in the case
of Delaware Group Cash Reserve, Inc., the Delaware Cash Reserve Consultant
Class) pro-rata with Class B Shares of that fund not acquired through dividend
reinvestment.

All such automatic conversions of Class B Shares will constitute
tax-free exchanges for federal income tax purposes. See Taxes.

Level Sales Charge Alternative - Class C Shares
Class C Shares may be purchased at net asset value without a front-end
sales charge and, as a result, the full amount of the investor's purchase
payment will be invested in Fund shares. The Distributor currently compensates
dealers or brokers for selling Class C Shares at the time of purchase from its
own assets in an amount equal to no more than 1% of the dollar amount purchased.
As discussed below, absent any applicable fee waiver, Class C Shares are subject
to annual 12b-1 Plan expenses and, if redeemed within 12 months of purchase, a
CDSC.

Proceeds from the CDSC and the annual 12b-1 Plan fees, if any, are paid
to the Distributor and others for providing distribution and related services,
and bearing related expenses, in connection with the sale of Class C Shares.
These payments support the compensation paid to dealers or brokers for selling
Class C Shares. Payments to the Distributor and others under the Class C 12b-1
Plan may be in an amount equal to no more than 1% annually.

Holders of Class C Shares who exercise the exchange privilege described
below will continue to be subject to the CDSC schedule for Class C Shares as
described in this Prospectus. See Redemption and Exchange.

Contingent Deferred Sales Charge - Class B Shares and Class C Shares
Class B Shares redeemed within six years of purchase may be subject to
a CDSC at the rates set forth below and Class C Shares redeemed within 12 months
of purchase may be subject to a CDSC of 1%. CDSCs are charged as a percentage of
the dollar amount subject to the CDSC. The charge will be assessed on an amount
equal to the lesser of the net asset value at the time of purchase of the shares
being redeemed or the net asset value of those shares at the time of redemption.
No CDSC will be imposed on increases in net asset value above the initial
purchase price, nor will a CDSC be assessed on redemptions of shares acquired
through reinvestments of dividends or capital gains distributions.

For purposes of this formula, the "net asset value at the time of
purchase" will be the net asset value at purchase of Class B Shares or Class C
Shares of a Fund, even if those shares are later exchanged for shares of another
Delaware Investments fund. In the event of an exchange of the shares, the "net
asset value of such shares at the time of redemption" will be the net asset
value of the shares that were acquired in the exchange.

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<PAGE>

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

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

During the seventh year after purchase and, thereafter, until converted
automatically into Class A Shares, Class B Shares will still be subject to the
annual 12b-1 Plan expenses of up to 1% of average daily net assets of those
shares, absent any applicable fee waiver. See Automatic Conversion of Class B
Shares, above. Investors are reminded that the Class A Shares into which Class B
Shares will convert are subject to ongoing annual 12b-1 Plan expenses of up to a
maximum of 0.30% of average daily net assets of such shares.

In determining whether a CDSC applies to a redemption of Class B
Shares, it will be assumed that shares held for more than six years are redeemed
first, followed by shares acquired through the reinvestment of dividends or
distributions, and finally by shares held longest during the six-year period.
With respect to Class C Shares, it will be assumed that shares held for more
than 12 months are redeemed first followed by shares acquired through the
reinvestment of dividends or distributions, and finally by shares held for 12
months or less.

All investments made during a calendar month, regardless of what day of
the month the investment occurred, will age one month on the last day of that
month and each subsequent month.

The CDSC is waived on certain redemptions of Class B Shares and Class C
Shares. See Waiver of Contingent Deferred Sales Charge - Class B and Class C
Shares under Redemption and Exchange.

Other Payments to Dealers -- Class A Shares, Class B Shares and Class C Shares
From time to time at the discretion of the Distributor, all registered
broker/dealers whose aggregate sales of the Classes exceed certain limits, as
set by the Distributor, may receive from the Distributor an additional payment
of up to 0.25% of the dollar amount of such sales. The Distributor may also
provide additional promotional incentives or payments to dealers that sell
shares of Delaware Investments funds. In some instances, these incentives or
payments may be offered only to certain dealers who maintain, have sold or may
sell certain amounts of shares.

Subject to pending amendments to the NASD's Conduct Rules, in
connection with the promotion of Delaware Investments fund shares, the
Distributor may, from time to time, pay to participate in dealer-sponsored
seminars and conferences, reimburse dealers for expenses incurred in connection
with preapproved seminars, conferences and advertising and may, from time to
time, pay or allow additional promotional incentives to dealers, which shall

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<PAGE>

include non-cash concessions, such as certain luxury merchandise or a trip to or
attendance at a business or investment seminar at a luxury resort, as part of
preapproved sales contests. Payment of non-cash compensation to dealers is
currently under review by the NASD and the Securities and Exchange Commission.
It is likely that the NASD's Conduct Rules will be amended such that the ability
of the Distributor to pay non-cash compensation as described above will be
restricted in some fashion. The Distributor intends to comply with the NASD's
Conduct Rules as they may be amended.

Institutional Classes
In addition to offering Class A Shares, Class B Shares and Class C
Shares, each Fund also offers an Institutional Class, which is described in a
separate prospectus and is available for purchase only by certain investors.
Institutional Class shares generally are distributed directly by the Distributor
and do not have a front-end sales charge, a CDSC or a Limited CDSC, and are not
subject to 12b-1 Plan distribution expenses. To obtain a prospectus that
describes the Funds' Institutional Classes, contact the Distributor by writing
to the address or by calling the telephone number listed on page 1 of this
Prospectus.

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<PAGE>

HOW TO BUY SHARES

Purchase Amounts
Generally, the minimum initial purchase is $1,000 for Class A Shares,
Class B Shares and Class C Shares. Subsequent purchases of shares of any Class
generally must be $100 or more. For purchases under a Uniform Gifts to Minors
Act or Uniform Transfers to Minors Act or through an Automatic Investing Plan,
there is a minimum initial purchase of $250 and a minimum subsequent purchase of
$25. Minimum purchase requirements do not apply to retirement plans other than
IRAs, for which there is a minimum initial purchase of $250, and a minimum
subsequent purchase of $25, regardless of which Class is selected.

There is a maximum purchase limitation of $250,000 on each purchase of
Class B Shares. For Class C Shares, each purchase must be in an amount that is
less than $1,000,000. An investor may exceed these maximum purchase limitations
by making cumulative purchases over a period of time. In doing so, an investor
should keep in mind that reduced front-end sales charges are available on
investments of $50,000 or more in Class A Shares, and that Class A Shares (i)
are subject to lower annual 12b-1 Plan expenses than Class B Shares and Class C
Shares and (ii) generally are not subject to a CDSC. For retirement plans, the
maximum purchase limitations apply only to the initial purchase of Class B
Shares or Class C Shares by the plan.

Investing through Your Investment Dealer
You can make a purchase of shares of any Fund through most investment
dealers who, as part of the service they provide, must transmit orders promptly.
They may charge for this service. If you want a dealer but do not have one,
Delaware Investments can refer you to one.

Investing by Mail
1. Initial Purchases--An Investment Application, or in the case of a retirement
plan account, an appropriate retirement plan application, must be completed,
signed and sent with a check payable to the specific Fund and Class selected to
Delaware Investments at 1818 Market Street, Philadelphia, PA 19103.

2. Subsequent Purchases--Additional purchases may be made at any time by mailing
a check payable to the specific Fund and Class selected. Your check should be
identified with your name(s) and account number. An investment slip (similar to
a deposit slip) is provided at the bottom of transaction confirmations and
dividend statements that you will receive from Global Funds, Inc. Use of this
investment slip can help expedite processing of your check when making
additional purchases. Your investment may be delayed if you send additional
purchases by certified mail.

Investing by Wire
You may purchase shares by requesting your bank to transmit funds by
wire to First Union National Bank, ABA #031201467, account number 2014128934013
(include your name(s) and your account number for the Class in which you are
investing).

1. Initial Purchases--Before you invest, telephone the Shareholder Service
Center to get an account number. If you do not call first, processing of your
investment may be delayed. In addition, you must promptly send your Investment
Application, or in the case of a retirement plan account, an appropriate
retirement plan application, to the specific Fund and Class selected, to
Delaware Investments at 1818 Market Street, Philadelphia, PA 19103.

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<PAGE>

2. Subsequent Purchases--You may make additional investments anytime by wiring
funds to First Union National Bank, as described above. You should advise the
Shareholder Service Center by telephone of each wire you send.

If you want to wire investments to a retirement plan account, call the
Shareholder Service Center for special wiring instructions.

Investing by Exchange
If you have an investment in another mutual fund in Delaware
Investments, you may write and authorize an exchange of part or all of your
investment into shares of any of the Funds. If you wish to open an account by
exchange, call the Shareholder Service Center for more information. All
exchanges are subject to the eligibility and minimum purchase requirements set
forth in each fund's prospectus. See Redemption and Exchange for more complete
information concerning your exchange privileges.

Holders of Class A Shares may exchange all or part of their shares for
certain of the shares of other Delaware Investments funds, including other Class
A Shares, but may not exchange their Class A Shares for Class B Shares or Class
C Shares of the Fund or of any other Delaware Investments fund. Holders of Class
B Shares of the Fund are permitted to exchange all or part of their Class B
Shares only into Class B Shares of other Delaware Investments funds. Similarly,
holders of Class C Shares of a Fund are permitted to exchange all or part of
their Class C Shares only into Class C Shares of other Delaware Investments
funds. Class B Shares of a Fund and Class C Shares of a Fund acquired by
exchange will continue to carry the CDSC and, in the case of Class B Shares, the
automatic conversion schedule of the fund from which the exchange is made. The
holding period of Class B Shares of a Fund acquired by exchange will be added to
that of the shares that were exchanged for purposes of determining the time of
the automatic conversion into Class A Shares of the Fund.

Permissible exchanges into Class A Shares of a Fund will be made
without a front-end sales charge, except for exchanges of shares that were not
previously subject to a front-end sales charge (unless such shares were acquired
through the reinvestment of dividends). Permissible exchanges into Class B
Shares or Class C Shares of a Fund will be made without the imposition of a CDSC
by the fund from which the exchange is being made at the time of the exchange.

See Allied Plans under Classes of Shares for information on exchanges
by participants in an Allied Plan.

Additional Methods of Adding to Your Investment
Call the Shareholder Service Center for more information if you wish to
use the following services:

1. Automatic Investing Plan
The Automatic Investing Plan enables you to make regular monthly
investments without writing or mailing checks. You may authorize Global Funds,
Inc. to transfer a designated amount monthly from your checking account to your
Fund account. Many shareholders use this as an automatic savings plan.
Shareholders should allow a reasonable amount of time for initial purchases and
changes to these plans to become effective.

This option is not available to participants in the following plans:
SAR/SEP, SEP/IRA, SIMPLE IRA, SIMPLE 401(k), Profit Sharing and Money Purchase
Pension Plans, 401(k) Defined Contribution Plans or 403(b)(7) or 457 Deferred
Compensation Plans.

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2. Direct Deposit
You may have your employer or bank make regular investments directly to
your Fund account for you (for example: payroll deduction, pay by phone, annuity
payments). The Funds also accept preauthorized recurring government and private
payments by Electronic Fund Transfer, which avoids mail time and check clearing
holds on payments such as social security, federal salaries, Railroad Retirement
benefits, etc.

* * *

Should investments through an automatic investing plan or by direct
deposit be reclaimed or returned for some reason, Global Funds, Inc. has the
right to liquidate your shares to reimburse the government or transmitting bank.
If there are insufficient funds in your account, you are obligated to reimburse
the Fund.

3. Wealth Builder Option
You can use our Wealth Builder Option to invest in the Funds through
regular liquidations of shares in your accounts in other funds in the Delaware
Investments. You may also elect to invest in other mutual funds offered by
Delaware Investments through the Wealth Builder Option through regular
liquidations of shares in your Fund account.

Under this automatic exchange program, you can authorize regular
monthly amounts (minimum of $100 per fund) to be liquidated from your account in
one or more Delaware Investments funds and invested automatically into any other
account in a Delaware Investments mutual fund that you may specify. If in
connection with the election of the Wealth Builder Option, you wish to open a
new account to receive the automatic investment, such new account must meet the
minimum initial purchase requirements described in the prospectus of the fund
that you select. All investments under this option are exchanges and are
therefore subject to the same conditions and limitations as other exchanges
noted above. You can terminate your participation in Wealth Builder at any time
by giving written notice to the fund from which the exchanges are made. See
Redemption and Exchange.

4. Dividend Reinvestment Plan
You can elect to have your distributions (capital gains and/or dividend
income) reinvested in your Fund account or invested in certain other funds
offered by Delaware Investments, subject to the exceptions noted below as well
as the eligibility and minimum purchase requirements set forth in each fund's
prospectus.

Reinvestments of distributions into Class A Shares of a Fund or of
other Delaware Investments funds are made without a front-end sales charge.
Reinvestments of distributions into Class B Shares of a Fund or of other
Delaware Investments funds or into Class C Shares of the Fund or of other
Delaware Investments funds are also made without any sales charge and will not
be subject to a CDSC if later redeemed. See Automatic Conversion of Class B
Shares under Classes of Shares for information concerning the automatic
conversion of Class B Shares acquired by reinvesting dividends.

Holders of Class A Shares of a Fund may not reinvest their
distributions into Class B Shares or Class C Shares of any fund offered by
Delaware Investments, including the Fund. Holders of Class B Shares of a Fund
may reinvest their distributions only into Class B Shares of the funds offered
by Delaware Investments which

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offer that class of shares. Similarly, holders of Class C Shares of a Fund may
reinvest their distributions only into Class C Shares of the funds offered by
Delaware Investments which offer that class of shares. For more information
about reinvestments, call the Shareholder Service Center.

Capital gains and/or dividend distributions for participants in the
following retirement plans are automatically reinvested into the same Delaware
Investments fund in which their investments are held: SAR/SEP, SEP/IRA, SIMPLE
IRA, SIMPLE 401(k), Profit Sharing and Money Purchase Pension Plans, 401(k)
Defined Contribution Plans or 403(b)(7) or 457 Deferred Compensation Plans.

Purchase Price and Effective Date
The offering price and net asset value of Class A Shares, Class B
Shares and Class C Shares are determined as of the close of regular trading on
the New York Stock Exchange (ordinarily, 4 p.m., Eastern time) on days when the
Exchange is open.

The effective date of a purchase made through an investment dealer is
the date the order is received by a Fund, its agent or designee. The effective
date of a direct purchase is the day your wire, electronic transfer or check is
received unless it is received after the time the offering price or net asset
value of shares is determined, as noted above. Purchase orders received after
such time will be effective the next business day.

The Conditions of Your Purchase
Each Fund reserves the right to reject any purchase order. If a
purchase is canceled because your check is returned unpaid, you are responsible
for any loss incurred. A Fund can redeem shares from your account(s) to
reimburse itself for any loss, and you may be restricted from making future
purchases in any of the funds offered by Delaware Investments. Each Fund
reserves the right to reject purchase orders paid by third-party checks or
checks that are not drawn on a domestic branch of a United States financial
institution. If a check drawn on a foreign financial institution is accepted,
you may be subject to additional bank charges for clearance and currency
conversion.

Each Fund also reserves the right, following shareholder notification,
to charge a service fee on non-retirement accounts that, as a result of
redemption, have remained below the minimum stated account balance for a period
of three or more consecutive months. Holders of such accounts may be notified of
their insufficient account balance and advised that they have until the end of
the current calendar quarter to raise their balance to the stated minimum. If
the account has not reached the minimum balance requirement by that time, the
Fund will charge a $9 fee for that quarter and each subsequent calendar quarter
until the account is brought up to the minimum balance. The service fee will be
deducted from the account during the first week of each calendar quarter for the
previous quarter, and will be used to help defray the cost of maintaining
low-balance accounts. No fees will be charged without proper notice, and no CDSC
will apply to such assessments.

Each Fund also reserves the right, upon 60 days' written notice, to
involuntarily redeem accounts that remain under the minimum initial purchase
amount as a result of redemptions. An investor making the minimum initial
investment may be subject to involuntary redemption without the imposition of a
CDSC or Limited CDSC if he or she redeems any portion of his or her account.

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REDEMPTION AND EXCHANGE

You can redeem or exchange your shares in a number of different ways.
The exchange service is useful if your investment requirements change and you
want an easy way to invest in other equity funds, bond funds, tax-advantaged
funds or money market funds. This service is also useful if you are anticipating
a major expenditure and want to move a portion of your investment into a fund
that has the checkwriting feature. Exchanges are subject to the requirements of
each fund and all exchanges of shares constitute taxable events. See Taxes.
Further, in order for an exchange to be processed, shares of the fund being
acquired must be registered in the state where the acquiring shareholder
resides. You may want to consult your financial adviser or investment dealer to
discuss which funds offered by Delaware Investments will best meet your changing
objectives, and the consequences of any exchange transaction. You may also call
Delaware Investments directly for fund information.

Your shares will be redeemed or exchanged at a price based on the net
asset value next determined after the Fund receives your request in good order,
subject, in the case of a redemption, to any applicable CDSC or Limited CDSC.
For example, redemption or exchange requests received in good order after the
time the offering price and net asset value of shares are determined will be
processed on the next business day. See Purchase Price and Effective Date under
How to Buy Shares. A shareholder submitting a redemption request may indicate
that he or she wishes to receive redemption proceeds of a specific dollar
amount. In the case of such a request, and in the case of certain redemptions
from retirement plan accounts, the Fund will redeem the number of shares
necessary to deduct the applicable CDSC in the case of Class B Shares and Class
C Shares, and, if applicable, the Limited CDSC in the case of Class A Shares and
tender to the shareholder the requested amount, assuming the shareholder holds
enough shares in his or her account for the redemption to be processed in this
manner. Otherwise, the amount tendered to the shareholder upon redemption will
be reduced by the amount of the applicable CDSC or Limited CDSC. Redemption
proceeds will be distributed promptly, as described below, but not later than
seven days after receipt of a redemption request.

Except as noted below, for a redemption request to be in "good order,"
you must provide your account number, account registration, and the total number
of shares or dollar amount of the transaction. For exchange requests, you must
also provide the name of the fund in which you want to invest the proceeds.
Exchange instructions and redemption requests must be signed by the record
owner(s) exactly as the shares are registered. You may request a redemption or
an exchange by calling the Shareholder Service Center at 800-523-1918. A Fund
may suspend, terminate, or amend the terms of the exchange privilege upon 60
days' written notice to shareholders.

A Fund will process written and telephone redemption requests to the
extent that the purchase orders for the shares being redeemed have already
settled. A Fund will honor redemption requests as to shares for which a check
was tendered as payment, but the Fund will not mail or wire the proceeds until
it is reasonably satisfied that the purchase check has cleared, which may take
up to 15 days from the purchase date. You can avoid this potential delay if you
purchase shares by wiring Federal Funds. Each Fund reserves the right to reject
a written or telephone redemption request or delay payment of redemption
proceeds if there has been a recent change to the shareholder's address of
record.

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<PAGE>

There is no front-end sales charge or fee for exchanges made between
shares of funds which both carry a front-end sales charge. Any applicable
front-end sales charge will apply to exchanges from shares of funds not subject
to a front-end sales charge, except for exchanges involving assets that were
previously invested in a fund with a front-end sales charge and/or exchanges
involving the reinvestment of dividends.

Holders of Class B Shares or Class C Shares that exchange their shares
("Original Shares") for shares of other Delaware Investments funds (in each
case, "New Shares") in a permitted exchange, will not be subject to a CDSC that
might otherwise be due upon redemption of the Original Shares. However, such
shareholders will continue to be subject to the CDSC and, in the case of Class B
Shares, the automatic conversion schedule of the Original Shares as described in
this Prospectus and any CDSC assessed upon redemption will be charged by the
fund from which the Original Shares were exchanged. In an exchange of Class B
Shares from a Fund, the Fund's CDSC schedule may be higher than the CDSC
schedule relating to the New Shares acquired as a result of the exchange. For
purposes of computing the CDSC that may be payable upon a disposition of the New
Shares, the period of time that an investor held the Original Shares is added to
the period of time that an investor held the New Shares. With respect to Class B
Shares, the automatic conversion schedule of the Original Shares may be longer
than that of the New Shares. Consequently, an investment in New Shares by
exchange may subject an investor, absent any applicable fee waiver, to the
higher 12b-1 fees applicable to Class B Shares of the Fund for a longer period
of time than if the investment in New Shares were made directly.

Various redemption and exchange methods are outlined below. Except for
the CDSC applicable to certain redemptions of Class B Shares and Class C Shares
and the Limited CDSC applicable to certain redemptions of Class A Shares
purchased at net asset value, there is no fee charged by a Fund or the
Distributor for redeeming or exchanging your shares, but such fees could be
charged in the future. You may have your investment dealer arrange to have your
shares redeemed or exchanged. Your investment dealer may charge for this
service.

Written Redemption
You can write to a Fund at 1818 Market Street, Philadelphia, PA 19103
to redeem some or all of your shares. The request must be signed by all owners
of the account or your investment dealer of record. For redemptions of more than
$50,000, or when the proceeds are not sent to the shareholder(s) at the address
of record, each Fund requires a signature by all owners of the account and a
signature guarantee for each owner. A signature guarantee can be obtained from a
commercial bank, a trust company or a member of a Securities Transfer
Association Medallion Program ("STAMP"). A signature guarantee cannot be
provided by a notary public. A signature guarantee is designed to protect the
shareholders, the Fund and its agents from fraud. Each Fund reserves the right
to reject a signature guarantee supplied by an eligible institution based on its
creditworthiness. The Funds may require further documentation from corporations,
executors, retirement plans, administrators, trustees or guardians.

Payment is normally mailed the next business day after receipt of your
redemption request. If your Class A Shares are in certificate form, the
certificate(s) must accompany your request and also be in good order.
Certificates are issued for Class A Shares only if a shareholder submits a
specific request. Certificates are not issued for Class B Shares or Class C
Shares.

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<PAGE>

Written Exchange
You may also write to each Fund (at 1818 Market Street, Philadelphia,
PA 19103) to request an exchange of any or all of your shares into another
mutual fund offered by Delaware Investments, subject to the same conditions and
limitations as other exchanges noted above.

Telephone Redemption and Exchange
To get the added convenience of the telephone redemption and exchange
methods, you must have the Transfer Agent hold your shares (without charge) for
you. If you choose to have your Class A Shares in certificate form, you may
redeem or exchange only by written request and you must return your
certificate(s).

The Telephone Redemption--Check to Your Address of Record service and
the Telephone Exchange service, both of which are described below, are
automatically provided unless you notify each Fund in writing that you do not
wish to have such services available with respect to your account. The Funds
reserve the right to modify, terminate or suspend these procedures upon 60 days'
written notice to shareholders. It may be difficult to reach a Fund by telephone
during periods when market or economic conditions lead to an unusually large
volume of telephone requests.

Neither the Funds nor their Transfer Agent is responsible for any
shareholder loss incurred in acting upon written or telephone instructions for
redemption or exchange of Fund shares which are reasonably believed to be
genuine. With respect to such telephone transactions, each Fund will follow
reasonable procedures to confirm that instructions communicated by telephone are
genuine (including verification of a form of personal identification) as, if it
does not, a Fund or the Transfer Agent may be liable for any losses due to
unauthorized or fraudulent transactions. Instructions received by telephone are
generally tape recorded, and a written confirmation will be provided for all
purchase, exchange and redemption transactions initiated by telephone. By
exchanging shares by telephone, you are acknowledging prior receipt of a
prospectus for the fund into which your shares are being exchanged.

Telephone Redemption--Check to Your Address of Record
The Telephone Redemption feature is a quick and easy method to redeem
shares. You or your investment dealer of record can have redemption proceeds of
$50,000 or less mailed to you at your address of record. Checks will be payable
to the shareholder(s) of record. Payment is normally mailed the next business
day after receipt of the redemption request. This service is only available to
individual, joint and individual fiduciary-type accounts.

Telephone Redemption--Proceeds to Your Bank
Redemption proceeds of $1,000 or more can be transferred to your
predesignated bank account by wire or by check. You should authorize this
service when you open your account. If you change your predesignated bank
account, you must complete an Authorization Form and have your signature
guaranteed. For your protection, your authorization must be on file. If you
request a wire, your funds will normally be sent the next business day. First
Union National Bank's fee (currently $7.50) will be deducted from your
redemption proceeds. If you ask for a check, it will normally be mailed the next
business day after receipt of your redemption request to your predesignated bank
account. There are no separate fees for this redemption method, but the mail
time may delay getting funds into your bank account. Simply call the Shareholder
Service Center prior to the time the offering price and net asset value are
determined, as noted above.

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<PAGE>

Telephone Exchange
The Telephone Exchange feature is a convenient and efficient way to
adjust your investment holdings as your liquidity requirements and investment
objectives change. You or your investment dealer of record can exchange your
shares into other funds offered by Delaware Investments under the same
registration, subject to the same conditions and limitations as other exchanges
noted above. As with the written exchange service, telephone exchanges are
subject to the requirements of each fund, as described above. Telephone
exchanges may be subject to limitations as to amounts or frequency.

Contingent Deferred Sales Charge for Certain Redemptions of Class A Shares
Purchased at Net Asset Value
For purchases of $1 million or more, a Limited CDSC will be imposed on
certain redemptions of Class A Shares (or shares into which such Class A Shares
are exchanged) according to the following schedule: (1) 1% if shares are
redeemed during the first year after the purchase; and (2) 0.50% if shares are
redeemed during the second year after the purchase, if such purchases were made
at net asset value and triggered the payment by the Distributor of the dealer's
commission previously described. See Classes of Shares.

The Limited CDSC will be paid to the Distributor and will be assessed
on an amount equal to the lesser of: (1) the net asset value at the time of
purchase of Class A Shares being redeemed; or (2) the net asset value of such
Class A Shares at the time of redemption. For purposes of this formula, the "net
asset value at the time of purchase" will be the net asset value at purchase of
Class A Shares even if those shares are later exchanged for shares of another
Delaware Investments fund and, in the event of an exchange of Class A Shares,
the "net asset value of such shares at the time of redemption" will be the net
asset value of the shares acquired in the exchange.

Redemptions of such Class A Shares held for more than two years will
not be subjected to the Limited CDSC and an exchange of such Class A Shares into
another Delaware Investments fund will not trigger the imposition of the Limited
CDSC at the time of such exchange. The period a shareholder owns shares into
which Class A Shares are exchanged will count towards satisfying the two year
holding period. The Limited CDSC is assessed if such two year period is not
satisfied irrespective of whether the redemption triggering its payment is of
Class A Shares of a Fund or Class A Shares acquired in the exchange.

In determining whether a Limited CDSC is payable, it will be assumed
that shares not subject to the Limited CDSC are the first redeemed followed by
other shares held for the longest period of time. The Limited CDSC will not be
imposed upon shares representing reinvested dividends or capital gains
distributions, or upon amounts representing share appreciation. All investments
made during a calendar month, regardless of what day of the month the investment
occurred, will age one month on the last day of that month and each subsequent
month.

Waiver of Limited Contingent Deferred Sales Charge - Class A Shares
The Limited CDSC for Class A Shares on which a dealer's commission has
been paid will be waived in the following instances: (i) redemptions that result
from a Fund's right to liquidate a shareholder's account if the aggregate net
asset value of the shares held in the account is less than the then-effective
minimum account size; (ii) distributions to participants from a retirement plan
qualified under section 401(a) or 401(k) of the Internal Revenue Code of 1986,
as amended (the "Code"), or due to death of a participant in such a plan; (iii)
redemptions pursuant to the direction of a participant or beneficiary of a
retirement plan qualified under section 401(a) or 401(k) of the Code with
respect to that retirement plan; (iv) periodic distributions from an IRA, SIMPLE
IRA or 403(b)(7) or 457 Deferred Compensation Plan or due to death, disability,
or attainment of age

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<PAGE>

59 1/2, and IRA distributions qualifying under Section 72(t) of the Internal
Revenue Code; (v) returns of excess contributions to an IRA; (vi) distributions
by other employee benefit plans to pay benefits; (vii) distributions described
in (ii), (iv), and (vi) above pursuant to a systematic withdrawal plan; and
(viii) redemptions by the classes of shareholders who are permitted to purchase
shares at net asset value, regardless of the size of the purchase (see Buying
Class A Shares at Net Asset Value under Classes of Shares).

Waiver of Contingent Deferred Sales Charge - Class B Shares and Class C Shares
The CDSC is waived on certain redemptions of Class B Shares in
connection with the following redemptions: (i) redemptions that result from a
Fund's right to liquidate a shareholder's account if the aggregate net asset
value of the shares held in the account is less than the then-effective minimum
account size; (ii) returns of excess contributions to an IRA, SIMPLE IRA,
SEP/IRA, 403(b)(7) or 457 Deferred Compensation Plan; (iii) periodic
distributions from an IRA, SIMPLE IRA, SAR/SEP, SEP/IRA, 403(b)(7) or 457
Deferred Compensation Plan due to death, disability or attainment of age 59 1/2,
and IRA distributions qualifying under Section 72(t) of the Code; and (iv)
distributions from an account if the redemption results from the death of all
registered owners of the account (in the case of accounts established under the
Uniform Gifts to Minors or Uniform Transfers to Minors Acts or trust accounts,
the waiver applies upon the death of all beneficial owners) or a total and
permanent disability (as defined in Section 72 of the Code) of all registered
owners occurring after the purchase of the shares being redeemed.

The CDSC on Class C Shares is waived in connection with the following
redemptions: (i) redemptions that result from a Fund's right to liquidate a
shareholder's account if the aggregate net asset value of the shares held in the
account is less than the then-effective minimum account size; (ii) returns of
excess contributions to an IRA, SIMPLE IRA, 403(b)(7) or 457 Deferred
Compensation Plan, Profit Sharing Plan, Money Purchase Pension Plan, or 401(k)
Defined Contribution Plan; (iii) periodic distributions from a 403(b)(7) or 457
Deferred Compensation Plan upon attainment of age 59 1/2, Profit Sharing Plan,
Money Purchase Plan, 401(k) Defined Contribution Plan upon attainment of age 70
1/2, and IRA distributions qualifying under Section 72(t) of the Code; (iv)
distributions from a 403(b)(7) Deferred Compensation Plan, 457 Deferred
Compensation Plan, Profit Sharing Plan, or 401(k) Defined Contribution Plan,
under hardship provisions of the plan; (v) distributions from a 403(b)(7) or 457
Deferred Compensation Plan, Profit Sharing Plan, Money Purchase Pension Plan or
a 401(k) Defined Contribution Plan upon attainment of normal retirement age
under the plan or upon separation from service; (vi) periodic distributions from
an IRA or SIMPLE IRA on or after attainment of age 59 1/2; and (vii)
distributions from an account if the redemption results from the death of all
registered owners of the account (in the case of accounts established under the
Uniform Gifts to Minors or Uniform Transfers to Minors Acts or trust accounts,
the waiver applies upon the death of all beneficial owners) or a total and
permanent disability (as defined in Section 72 of the Code) of all registered
owners occurring after the purchase of the shares being redeemed.

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DIVIDENDS AND DISTRIBUTIONS

Global Funds, Inc. declares a dividend on each Fund to all shareholders
of record of the Classes of the Fund at the time the offering price of shares is
determined. See Purchase Price and Effective Date under How to Buy Shares. Thus,
when redeeming shares, dividends continue to be credited up to and including the
date of redemption.

Each Class of a Fund will share proportionately in the investment
income and expenses of the Fund, except that, absent any applicable fee waiver,
the per share dividends from net investment income on Class A Shares, Class B
Shares and Class C Shares will vary due to the expenses under the 12b-1 Plan
applicable to each Class. Generally, when a 12b-1 Plan fee waiver is not in
effect, the dividends per share on Class B Shares and Class C Shares can be
expected to be lower than the dividends per share on Class A Shares because the
expenses under the 12b-1 Plans relating to Class B Shares and Class C Shares
will be higher than the expenses under the 12b-1 Plan relating to Class A
Shares. See Distribution (12b-1) and Service under Management of the Funds.

Both dividends and distributions, if any, are automatically reinvested
in your account at net asset value. See The Delaware Difference for more
information on reinvestment options.

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TAXES

On August 5, 1997, the Taxpayer Relief Act of 1997 (the "1997 Act") was
signed into law. This new law makes sweeping changes in the Code. Because many
of these changes are complex, and only indirectly affect the Fund and its
distributions to you, they are discussed in Part B. Changes in the treatment of
capital gains, however, are discussed in this section.

The Treatment of Capital Gain Distributions under the Taxpayer Relief Act
of 1997
The 1997 Act creates a category of long-term capital gain for
individuals that will be taxed at new lower tax rates. For investors who are in
the 28% or higher federal income tax brackets, these gains will be taxed at a
maximum rate of 20%. For investors who are in the 15% federal income tax
bracket, these gains will be taxed at a maximum rate of 10%. Capital gain
distributions will qualify for these new maximum tax rates, depending on when a
Fund's securities were sold and how long they were held by the Fund before they
were sold. The holding periods for which the new rates apply were revised by the
Internal Revenue Service Restructuring and Reform Act of 1998. Investors who
want more information on holding periods and other qualifying rules relating to
these new rates should review the expanded discussion in Part B, or should
contact their own tax advisers.

Global Funds, Inc. will advise you in its annual information reporting
at calendar year end of the amount of its capital gain distributions which will
qualify for these maximum federal tax rates.

Although dividends generally will be treated as distributed when paid,
dividends which are declared in October, November or December to shareholders of
record on a specified date in one of those months, but which, for operational
reasons, may not be paid to the shareholder until the following January, will be
treated for tax

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<PAGE>

purposes as if paid by the Fund and received by the shareholder on December 31
of the calendar year in which they are declared.

The sale of shares of a Fund is a taxable event and may result in a
capital gain or loss to shareholders subject to tax. Capital gain or loss may be
realized from an ordinary redemption of shares or an exchange of shares between
one fund and another Delaware Investments fund. Any loss incurred on a sale or
exchange of Fund shares that had been held for six months or less will be
treated as a long-term capital loss to the extent of capital gains dividends
received with respect to such shares. All or a portion of the sales charge
incurred in acquiring Fund shares will be excluded from the federal tax basis of
any of such shares sold or exchanged within 90 days of their purchase (for
purposes of determining gain or loss upon the sale of such shares) if the sale
proceeds are reinvested in the Fund or in another fund offered by Delaware
Investments and a sales charge that would otherwise apply to the reinvestment is
reduced or eliminated. Any portion of such sales charge excluded from the tax
basis of the shares sold will be added to the tax basis of the shares acquired
in the reinvestment.

The automatic conversion of Class B Shares into Class A Shares at the
end of approximately eight years after purchase will be tax-free for federal tax
purposes. See Automatic Conversion of Class B Shares under Classes of Shares.

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

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CALCULATION OF OFFERING PRICE AND NET ASSET VALUE PER SHARE

The net asset value ("NAV") per share of each Fund is computed by
adding the value of all securities and other assets in the Fund's portfolio,
deducting any liabilities of the Fund (expenses and fees are accrued daily) and
dividing by the number of Fund shares outstanding. Portfolio securities for
which market quotations are available are priced at market value. Debt
securities are priced at fair value by an independent pricing service using
methods approved by Global Funds, Inc.'s Board of Directors. Short-term
investments having a maturity of less than 60 days are valued at amortized cost,
which approximates market value. All other securities are valued at their fair
value as determined in good faith and in a method approved by Global Funds,
Inc.'s Board of Directors.

Class A Shares are purchased at the offering price per share, while
Class B Shares and Class C Shares are purchased at the NAV per share. The
offering price per share of Class A Shares consists of the NAV per share next
computed after the order is received, plus any applicable front-end sales
charges.

The offering price and NAV are computed as of the close of regular
trading on the New York Stock Exchange (ordinarily, 4 p.m., Eastern time) on
days when the Exchange is open.

The net asset values of all outstanding shares of each class of each
Fund will be computed on a pro-rata basis for each outstanding share based on
the proportionate participation in the Fund represented by the value of shares
of that class. All income earned and expenses incurred by a Fund will be borne
on a pro-rata basis by each outstanding share of a class, based on each class'
percentage in the Fund represented by the value of shares of such classes,
except that the Institutional Class of each Fund will not incur any of the
expenses under Global Funds, Inc.'s 12b-1 Plans related to each Fund, and Class
A Shares, Class B Shares and Class C Shares of each Fund alone will bear the
12b-1 Plan expenses, if any, payable under their respective 12b-1 Plans. Due to
the specific distribution expenses and other costs that will be allocable to
each class, the NAV of each class of each Fund will vary.

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<PAGE>

MANAGEMENT OF THE FUNDS

Investment Manager
The Manager furnishes investment management services to each Fund. The
Manager has offices located at 80 Cheapside, Third Floor, London, England EC2V
6EE.

As noted below, the Distributor has temporarily elected to voluntarily
waive its right to receive 12b-1 fees from each Fund. The Manager has also
elected voluntarily to waive that portion, if any, of the annual management fees
payable by the New Europe and Latin America Funds and to pay expenses of each
Fund to the extent necessary to ensure that the Total Operating Expenses
(exclusive of taxes, interest, brokerage commissions and extraordinary expenses
and 12b-1 expenses) of each Fund do not exceed 1.25%, respectively, through May
31, 1999.

Messrs. Nigel May, Richard Ginty and Joshua Brooks have primary
responsibility for making day-to-day investment decisions for New Europe Fund.
Mr. May is a graduate of Sidney Sussex College, Cambridge and joined Delaware
International in 1991, assuming portfolio management responsibilities and
sharing analytical responsibilities for continental Europe. Prior to joining
Delaware International, he spent five years with Hill Samuel Investment Advisers
Ltd.

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<PAGE>

Clive A. Gillmore, Robert Akester and Mr. Brooks have primary
responsibility for making day-to-day investment decisions for Latin America
Fund. A graduate of the University of Warwick and having begun his career at
Legal and General Investment Management, Mr. Gillmore joined Delaware
International in 1990 after eight years of investment experience. His most
recent position prior to joining Delaware Investments was as a Pacific Basin
equity analyst and senior portfolio manager for Hill Samuel Investment Advisers
Ltd. Mr. Gillmore completed the London Business School Investment program.

Performance Information
From time to time, the Funds may quote total return performance of
their Classes in advertising and other types of literature.

Total return will be based on a hypothetical $1,000 investment,
reflecting the reinvestment of all distributions at net asset value and: (i) in
the case of Class A Shares, the impact of the maximum front-end sales charge at
the beginning of each specified period; and (ii) in the case of Class B Shares
and Class C Shares, the deduction of any applicable CDSC at the end of the
relevant period. Each presentation will include the average annual total return
for one-, five- and ten-year, or life-of-fund periods, as applicable. The Funds
may also advertise aggregate and average total return information concerning a
Class over additional periods of time. In addition, the Funds may present total
return information that does not reflect the deduction of the maximum

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<PAGE>

front-end sales charge or any applicable CDSC. In this case, such total return
information would be more favorable than total return information that includes
deductions of the maximum front-end sales charge or any applicable CDSC.

Because securities prices fluctuate, investment results of the Classes
will fluctuate over time. Past performance is not considered a guarantee of
future results.

Distribution (12b-1) and Service
The Distributor, Delaware Distributors, L.P., serves as the national
distributor for each Fund's shares under separate Distribution Agreements with
Global Funds, Inc. dated December 23, 1998.

Global Funds, Inc. has adopted separate distribution plans under Rule
12b-1 for each of the Class A Shares, Class B Shares and Class C Shares of each
Fund (the "Plans"). The Plans permit the Funds to pay the Distributor from the
assets of their respective Classes a monthly fee for the Distributor's services
and expenses in distributing and promoting sales of shares.

These expenses include, among other things, preparing and distributing
advertisements, sales literature, and prospectuses and reports used for sales
purposes, compensating sales and marketing personnel, holding special promotions
for specified periods of time, and paying distribution and maintenance fees to
brokers, dealers and others. In connection with the promotion of shares of each
Fund's Classes, the Distributor may, from time to time, pay to participate in
dealer-sponsored seminars and conferences, and reimburse dealers for expenses
incurred in connection with preapproved seminars, conferences, and advertising.
The Distributor may pay or allow additional promotional incentives to dealers as
part of preapproved sales contests and/or to dealers who provide extra training
and information concerning a Class and increase sales of the Class. In addition,
the Funds may make payments from the 12b-1 Plan fees of their respective Classes
directly to others, such as banks, who aid in the distribution of Class shares
or provide services in respect of a Class, pursuant to service agreements with
Global Funds, Inc. The Distributor has elected voluntarily to waive its right to
receive 12b-1 fees (including service fees) from the commencement of the public
offering of the Classes through May 31, 1999.

The 12b-1 Plan expenses relating to each of the Class B Shares and
Class C Shares of each Fund are also used to pay the Distributor for advancing
the commission costs to dealers with respect to the initial sale of such shares.

Absent any applicable fee waiver, the aggregate fees paid by the Funds
from the assets of the respective Classes to the Distributor and others under
the Plans may not exceed (i) 0.30% of the Class A Shares' average daily net
assets in any year, and (ii) 1% (0.25% of which are service fees to be paid by
each Fund to the Distributor, dealers and others for providing personal service
and/or maintaining shareholder accounts) of each of the Class B Shares' and
Class C Shares' average daily net assets in any year. No Fund's Class A Shares,
Class B Shares and Class C Shares will incur any distribution expenses beyond
these limits, which may not be increased without shareholder approval.

Although the maximum fee payable under the Plan relating to Class A
Shares is 0.30% of average daily net assets, the Board of Directors has
currently set the annual fee for the Class at 0.25% of the average daily net
assets. The Board of Directors may increase the fee to the full 0.30% on all
Class A Shares' assets at any time.
See Shares.

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<PAGE>

While payments, if any, pursuant to the Plans may not exceed 0.30%
annually with respect to Class A Shares, and 1% annually with respect to each of
the Class B Shares and Class C Shares, the Plans do not limit fees to amounts
actually expended by the Distributor. It is therefore possible that the
Distributor may realize a profit in any particular year. However, the
Distributor currently expects that distribution expenses will likely equal or
exceed payments under the Plans. The Distributor may, however, incur such
additional expenses and make additional payments to dealers from its own
resources to promote the distribution of shares of the Classes. The monthly fees
paid to the Distributor under the Plans are subject to the review and approval
of Global Funds, Inc.'s unaffiliated directors, who may reduce the fees or
terminate the Plans at any time.

The Plans do not apply to shares of any Fund's Institutional Class.
Those shares are not included in calculating the Plans' fees, and the Plans are
not used to assist in the distribution and marketing of shares of the
Institutional Classes.

The Transfer Agent, Delaware Service Company, Inc., serves as the
shareholder servicing, dividend disbursing and transfer agent for each Fund
pursuant to an amended and restated agreement dated December 23, 1998. The
Transfer Agent also provides accounting services to each Fund pursuant to the
terms of a separate Fund Accounting Agreement.

The directors of Global Funds, Inc. annually review service fees paid
to the Distributor and the Transfer Agent. The Distributor and the Transfer
Agent are also indirect, wholly owned subsidiaries of DMH.

* * *

-49-

<PAGE>

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.

New Europe Fund and Latin America Fund also offer New Europe Fund
Institutional Class and Latin America Fund Institutional Class of shares, as
well as Class A Shares, Class B Shares and Class C Shares. Shares of each Class
represent proportionate interests in the assets of each respective Fund and have
the same voting and other rights and preferences as the other Classes of that
Fund, except that shares of the Institutional Classes of each Fund are not
subject to, and may not vote on matters affecting, the Distribution Plans under
Rule 12b-1 relating to Class A Shares, Class B Shares and Class C Shares.
Similarly, as a general matter, the shareholders of Class A Shares, Class B
Shares and Class C Shares may vote only on matters affecting the 12b-1 Plan that
relates to the class of shares that they hold. However, Class B Shares of a Fund
may vote on any proposal to increase materially the fees to be paid by the Fund
under the 12b-1 Plan relating to Class A Shares of that Fund.

The Lincoln National Life Insurance Company ("LNLIC") is expected to
make the initial investment in the Fund. This could result in LNLIC owning up to
100% of the outstanding shares of the Fund. Subject to certain limited
exceptions, there are no limitations on LNLIC's ability to redeem its shares of
the Fund and it may elect to do so at any time.

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<PAGE>

OTHER INVESTMENT POLICIES AND RISK CONSIDERATIONS

-51-

<PAGE>

Portfolio Loan Transactions
Each Fund may loan up to 25% of its assets to qualified broker/dealers
or institutional investors for their use relating to short sales or other
security transactions.

-52-

<PAGE>

-53-

<PAGE>

In purchasing put and call options, the premium paid by a Fund plus any
transaction costs will reduce any benefit realized by such Fund upon exercise of
the option.

-54-

<PAGE>

-55-

<PAGE>

APPENDIX A--RATINGS

General Rating Information

-56-
<PAGE>

Delaware Investments includes funds with a
wide range of investment objectives. Stock funds,
income funds, national and state-specific tax-
exempt funds, money market funds, global and
international funds and closed-end funds give
investors the ability to create a portfolio that fits
their personal financial goals. For more
information, shareholders of the Fund Classes
should contact their financial adviser or call
Delaware Investments at 800-523-4640, and
shareholders of the Institutional Classes should
contact Delaware Investments at 800-510-4015.

INVESTMENT MANAGER
Delaware International Advisers Ltd.
80 Cheapside
Third Floor
London, England EC2V 6EE

NATIONAL DISTRIBUTOR
Delaware Distributors, L.P.
1818 Market Street
Philadelphia, PA 19103

SHAREHOLDER SERVICING,
DIVIDEND DISBURSING,
ACCOUNTING SERVICES
AND TRANSFER AGENT
Delaware Service Company, Inc.
1818 Market Street
Philadelphia, PA 19103

LEGAL COUNSEL
Stradley, Ronon, Stevens & Young, LLP
One Commerce Square
Philadelphia, PA 19103

INDEPENDENT AUDITORS
Ernst & Young LLP Two Commerce
Square Philadelphia, PA 19103

CUSTODIAN
The Chase Manhattan Bank
4 Chase Metrotech Center
Brooklyn, NY 11245

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

DELAWARE GROUP
GLOBAL & INTERNATIONAL FUNDS, INC.

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

NEW EUROPE FUND
LATIN AMERICA FUND
- -----------------------------------

PART B

STATEMENT OF
ADDITIONAL INFORMATION

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

DECEMBER 23, 1998

[LOGO]

<PAGE>

- -------------------------------------------------------------------------------
PART B--STATEMENT OF ADDITIONAL INFORMATION
DECEMBER 23, 1998
- -------------------------------------------------------------------------------

DELAWARE GROUP GLOBAL & INTERNATIONAL FUNDS, INC.
- -------------------------------------------------------------------------------

NEW EUROPE FUND
LATIN AMERICA FUND
- -------------------------------------------------------------------------------

1818 Market Street
Philadelphia, PA 19103
- -------------------------------------------------------------------------------

For more information about Institutional Classes: 800-510-4015

For Prospectus and Performance of Class A Shares, Class B Shares and
Class C Shares:
Nationwide 800-523-4640

Information on Existing Accounts of Class A Shares, Class B Shares and
Class C Shares:
(SHAREHOLDERS ONLY) Nationwide 800-523-1918

Dealer Services: (BROKER/DEALERS ONLY) Nationwide 800-362-7500
- -------------------------------------------------------------------------------

TABLE OF CONTENTS

- -------------------------------------------------------------------------------
Cover Page 1
- -------------------------------------------------------------------------------
Investment Policies and Portfolio Techniques 3
- -------------------------------------------------------------------------------
Accounting and Tax Issues
- -------------------------------------------------------------------------------
Performance Information
- -------------------------------------------------------------------------------
Trading Practices and Brokerage
- -------------------------------------------------------------------------------
Purchasing Shares
- -------------------------------------------------------------------------------
Investment Plans
- -------------------------------------------------------------------------------
Determining Offering Price and Net Asset Value
- -------------------------------------------------------------------------------
Redemption and Repurchase
- -------------------------------------------------------------------------------
Distributions
- -------------------------------------------------------------------------------
Investment Management Agreements
- -------------------------------------------------------------------------------
Officers and Directors
- -------------------------------------------------------------------------------
Exchange Privilege
- -------------------------------------------------------------------------------
General Information
- -------------------------------------------------------------------------------
Financial Statements
- -------------------------------------------------------------------------------

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<PAGE>

Delaware Group Global & International Funds, Inc. ("Global Funds,
Inc.") is a professionally-managed mutual fund of the series type. This
Statement of Additional Information ("Part B" of the registration statement)
describes the New Europe Series ("New Europe Fund") and Latin America Series
("Latin America Fund") (individually, a "Fund" and collectively, the "Funds") of
Global Funds, Inc. Each Fund offers Class A Shares, Class B Shares, Class C
Shares (together the "Fund Classes"), and an Institutional Class (individually a
"Class" and collectively the "Classes"). A separate Statement of Additional
Information dated February 4, 1998, relates to Global Fund Inc.'s remaining six
series and is available by contacting the Fund's national distributor, Delaware
Distributors, L.P. at the noted address or by calling the numbers listed above
on page 1 of this Part B.

Class B Shares, Class C Shares and Institutional Class shares of each
Fund may be purchased at a price equal to the next determined net asset value
per share. Class A Shares may be purchased at the public offering price, which
is equal to the next determined net asset value per share, plus a front-end
sales charge. Class A Shares are subject to a maximum front-end sales charge of
5.75% and, absent any applicable fee waiver, annual Rule 12b-1 Plan ("12b-1
Plan") expenses of up to 0.30%. Class B Shares are subject to a contingent
deferred sales charge ("CDSC") which may be imposed on redemptions made within
six years of purchase and, absent any applicable fee waiver, annual 12b-1 Plan
expenses of up to 1%, which are assessed against Class B Shares for
approximately eight years after purchase. See Automatic Conversion of Class B
Shares under Classes of Shares in the Prospectuses for the Fund Classes. Class C
Shares are subject to a CDSC which may be imposed on redemptions made within 12
months of purchase and, absent any applicable fee waiver, annual 12b-1 Plan
expenses of up to 1%, which are assessed against the Class C Shares for the life
of the investment. Due to voluntary waivers by Delaware Distributors, L.P. (the
"Distributor"), New Europe Fund and Latin America Fund will not pay 12b-1 fees
with respect to any Class through May 31, 1999.

This Part B supplements the information contained in the current
Prospectuses for the Fund Classes and the Institutional Classes dated December
23, 1998 for the Funds, as they may be amended from time to time. Part B should
be read in conjunction with the respective Class' Prospectus. Part B is not
itself a prospectus but is, in its entirety, incorporated by reference into each
Class' Prospectus. Prospectuses relating to the Fund Classes and Prospectuses
relating to the Institutional Classes may be obtained by writing or calling your
investment dealer or by contacting the Funds' national distributor, Delaware
Distributors, L.P., 1818 Market Street, Philadelphia, PA 19103.

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<PAGE>

INVESTMENT POLICIES AND PORTFOLIO TECHNIQUES

Investment Restrictions
Global Funds, Inc. has adopted the following restrictions for each Fund
(except where otherwise noted) which cannot be changed without approval by the
holders of a "majority" of the respective Fund's outstanding shares, which is a
vote by the holders of the lesser of a) 67% or more of the voting securities
present in person or by proxy at a meeting, if the holders of more than 50% of
the outstanding voting securities are present or represented by proxy; or b)
more than 50% of the outstanding voting securities. The percentage limitations
contained in the restrictions and policies set forth herein apply at the time of
purchase of securities.

Each Fund shall not:

1. Make investments that will result in the concentration (as that term
may be defined in the 1940 Act, any rule or other thereunder, or U.S. Securities
and Exchange Commission ("SEC") staff interpretation thereof) of its investments
in the securities of issuers primarily engaged in the same industry, provided
that this restriction does not limit the Fund from investing in obligations
issued or guaranteed by the U.S. government, its agencies or instrumentalities,
or in certificates of deposit.

2. Borrow money or issue senior securities, except as the 1940 Act, any
rule or order thereunder, or SEC staff interpretation thereof, may permit.

3. Underwrite the securities of other issuers, except that the Fund may
engage in transactions involving the acquisition, disposition or resale of its
portfolio securities, under circumstances where it may be considered to be an
underwriter under the Securities Act of 1933.

4. Purchase or sell real estate, unless acquired as a result of
ownership of securities or other instruments and provided that this restriction
does not prevent the Fund from investing in issuers which invest, deal or
otherwise engage in transactions in real estate or interests therein, or
investing in securities that are secured by real estate or interests therein.

5. Purchase or sell physical commodities, unless acquired as a result
of ownership of securities or other instruments and provided that this
restriction does not prevent the Fund from engaging in transactions involving
futures contracts and options thereon or investing in securities that are
secured by physical commodities.

6. Make loans, provided that this restriction does not prevent the Fund
from purchasing debt obligations, entering into repurchase agreements, loaning
its assets to broker/dealers or institutional investors and investing in loans,
including assignments and participation interests.

In applying each Fund's fundamental policy concerning concentration
that is described above, it is a matter of non-fundamental policy that: (i)
utility companies will be divided according to their services, for example, gas,
gas transmission, electric and telephone will each be considered a separate
industry; (ii) financial service companies will be classified according to the
end users of their services, for example, automobile finance, bank finance and
diversified finance will each be considered a separate industry; and (iii) asset
backed securities will be classified according to the underlying assets securing
such securities.

-4-
<PAGE>

In addition to the fundamental policies and investment restrictions
described above, and the various general investment policies described in the
prospectus, the New Europe Fund and Latin America Fund will be subject to the
following investment restrictions, which are considered non-fundamental and may
be changed by the Board of Directors without shareholder approval.

1. The Fund is permitted to invest in other investment companies,
including open-end, closed-end or unregistered investment companies, either
within the percentage limits set forth in the 1940 Act, any rule or order
thereunder, or SEC staff interpretation thereof, or without regard to percentage
limits in connection with a merger, reorganization, consolidation or other
similar transaction. However, the Fund may not operate as a "fund of funds"
which invests primarily in the shares of other investment companies as permitted
by Section 12(d)(1)(F) or (G) of the 1940 Act, if its own shares are utilized as
investments by such a "fund of funds."

2. The Fund may not invest more than 15% of its net assets in
securities which it cannot sell or dispose of in the ordinary course of business
within seven days at approximately the value at which the Fund has valued the
investment.

Foreign Securities
Investors should recognize that investing in foreign issuers involves
certain considerations, including those set forth in the Funds' Prospectuses,
which are not typically associated with investing in United States issuers.
Since the stocks of foreign companies are frequently denominated in foreign
currencies, and since a Fund may temporarily hold uninvested reserves in bank
deposits in foreign currencies, a Fund 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 Fund permit it to enter into forward foreign currency exchange
contracts in order to hedge each Fund's holdings and commitments against changes
in the level of future currency rates. Such contracts involve an obligation to
purchase or sell a specific currency at a future date at a price set at the time
of the contract.

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 a Fund. Payment of
such interest equalization tax, if imposed, would reduce a Fund's rate of return
on its investment. Dividends paid by foreign issuers may be subject to
withholding and other foreign taxes which may decrease the net return on such
investments as compared to dividends paid to a Fund by United States
corporations. 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 generally
include 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, futures contract, option and similar financial instruments other than
any "regulated futures contract" or "nonequity option" 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. However, foreign
currency-related regulated futures contracts and nonequity options are generally
not subject to the special currency rules, if they are or would be treated as
sold for their fair market value at year-end under the marking to market rules
applicable to other futures contracts, unless an election is made to have such
currency rules apply. 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, futures contracts and
options that are capital assets in the hands of the taxpayer and which are not

-5-

<PAGE>

part of a straddle. 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. The income tax effects of integrating and
treating a transaction as a single transaction are generally to create a
synthetic debt instrument that is subject to the original discount provisions.
It is anticipated that some of the non-U.S. dollar denominated investments and
foreign currency contracts each Fund may make or enter into will be subject to
the special currency rules described above.

Repurchase Agreements
While each Fund is permitted to do so, it normally does not invest in
repurchase agreements, except to invest cash balances.

The Delaware Investments funds have obtained an exemption from the
joint-transaction prohibitions of Section 17(d) of the 1940 Act to allow
Delaware Investments funds jointly to invest cash balances. Each Fund may invest
cash balances in a joint repurchase agreement in accordance with the terms of
the Order and subject generally to the conditions described below.

A repurchase agreement is a short-term investment by which the
purchaser acquires ownership of a debt security and the seller agrees to
repurchase the obligation at a future time and set price, thereby determining
the yield during the purchaser's holding period. Should an issuer of a
repurchase agreement fail to repurchase the underlying security, the loss to a
Fund, if any, would be the difference between the repurchase price and the
market value of the security. Each Fund will limit its investments in repurchase
agreements to those which Delaware International Advisers Ltd. (the "Manager"),
under the guidelines of the Board of Directors, determines to present minimal
credit risks and which are of high quality. In addition, a Fund must have
collateral of at least 102% of the repurchase price, including the portion
representing a Fund's yield under such agreements which is monitored on a daily
basis.

Portfolio Loan Transactions
Each Fund may loan up to 25% of its assets to qualified broker/dealers
or institutional investors for their use relating to short sales or other
security transactions.

It is the understanding of the Manager that the staff of the SEC
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 Global Funds,
Inc. from the borrower; 2) this collateral must be valued daily and should the
market value of the loaned securities increase, the borrower must furnish
additional collateral to the Fund; 3) the Fund must be able to terminate the
loan after notice, at any time; 4) the Fund must receive reasonable interest on
any loan, and any dividends, interest or other distributions on the lent
securities, and any increase in the market value of such securities; 5) the Fund
may pay reasonable custodian fees in connection with the loan; and 6) the voting
rights on the lent securities may pass to the borrower; however, if the
directors of Global Funds, Inc. 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 Fund would be exposed on a portfolio loan
transaction is the risk that the borrower would go bankrupt at a time when the
value of the security goes up. Therefore, each Fund will only enter into loan
arrangements after a review of all pertinent facts by the Manager, under the
supervision of the Board of Directors, including the creditworthiness of the
borrowing broker, dealer or institution and then only if

-6-

<PAGE>

the consideration to be received from such loans would justify the risk.
Creditworthiness will be monitored on an ongoing basis by the Manager.

Foreign Currency Transactions
A Fund 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 Fund will account for forward
contracts by marking to market each day at daily exchange rates.

When a Fund 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 a Fund's assets denominated in such
foreign currency, the Fund's Custodian Bank or subcustodian will place cash or
liquid high grade debt securities in a separate account of the Fund in an amount
not less than the value of the Fund's total assets 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 a Fund's commitments with respect to such contracts.

Options
Each Fund may purchase call options or purchase put options and will
not engage in option strategies for speculative purposes.

Each Fund may invest in options that are either listed on U.S. or
recognized foreign exchanges 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 a Fund's ability to
effectively hedge its securities. A Fund will not, however, invest more than 15%
of its assets in illiquid securities.

Purchasing Call Options--Each Fund may purchase call options to the
extent that premiums paid by the Fund do not aggregate more than 2% of the
Fund's total assets. When a Fund purchases a call option, in return for a
premium paid by a Fund to the writer of the option, the Fund 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 a Fund may alter
portfolio characteristics and modify portfolio maturities without incurring the
cost associated with portfolio transactions.

A Fund may, following the purchase of a call option, liquidate its
position by effecting a closing sale transaction. This is accomplished by
selling an option of the same series as the option previously purchased. A Fund
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; a Fund 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 a Fund 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.

-7-

<PAGE>

In such event, it may not be possible to effect closing transactions in
particular options, with the result that a Fund would have to exercise its
options in order to realize any profit and would incur brokerage commissions
upon the exercise of such options and upon the subsequent 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 Fund may expire without any value to the Fund.

Purchasing Put Options--Each Fund may invest up to 2% of its total
assets in the purchase of put options. A Fund will, at all times during which it
holds a put option, own the security covered by such option.

A put option purchased by a Fund gives it the right to sell one of its
securities for an agreed price up to an agreed date. A Fund intends to purchase
put options in order to protect against a decline in the market value of the
underlying security below the exercise price less the premium paid for the
option ("protective puts"). The ability to purchase put options will allow a
Fund to protect unrealized gain in an appreciated security in its portfolio
without actually selling the security. If the security does not drop in value, a
Fund will lose the value of the premium paid. A Fund may sell a put option which
it has previously purchased prior to the sale of the securities underlying such
option. Such sale 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.

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

Futures
Each Fund may enter into contracts for the purchase or sale for future
delivery of securities or foreign currencies. 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 Fund
enters into a futures transaction, it must deliver to the futures commission
merchant selected by the Fund an amount referred to as "initial margin." This
amount is maintained by the futures commission merchant in an account at the
Fund's Custodian Bank. Thereafter, a "variation margin" may be paid by a Fund
to, or drawn by the Fund from, such account in accordance with controls set for
such accounts, depending upon changes in the price of the underlying securities
subject to the futures contract.

In addition, when a Fund engages in futures transactions, to the extent
required by the SEC, it will maintain with its Custodian Bank, assets in a
segregated account to cover its obligations with respect to such contracts,
which assets will consist of cash, cash equivalents or high quality debt
securities from its portfolio in an amount equal to the difference between the
fluctuating market value of such futures contracts and the aggregate value of
the margin payments made by a Fund with respect to such futures contracts.

Each Fund may enter into such futures contracts to protect against the
adverse affects of fluctuations in interest or foreign exchange rates without
actually buying or selling the securities or foreign currency. For example, if
interest rates are expected to increase, a Fund 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 a Fund. If
interest rates did increase, the value of the debt securities in the portfolio
would decline, but the value of the futures contracts to a Fund would increase
at approximately the same rate, thereby keeping the net asset value of the Fund
from declining as much as it otherwise would have. Similarly, when it is
expected that

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interest rates may decline, futures contracts may be purchased to hedge in
anticipation of subsequent purchases of securities at higher prices. Since the
fluctuations in the value of futures contracts should be similar to those of
debt securities, a Fund 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 Fund could then buy
debt securities on the cash market.

With respect to options on futures contracts, when a Fund 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. As with the purchase of
futures contracts, when a Fund 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 writing of a call option on a futures contract constitutes a
partial hedge against the declining price of the security or foreign currency
which is deliverable upon exercise of the futures contract. If the futures price
at the expiration of the option is below the exercise price, a Fund will retain
the full amount of the option premium which provides a partial hedge against any
decline that may have occurred in the Fund's portfolio holdings. The writing of
a put option on a futures contract constitutes a partial hedge against the
increasing price of the security or foreign currency 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 Fund will retain the full amount
of the option premium which provides a partial hedge against any increase in the
price of securities which the Fund intends to purchase.

If a put or call option a Fund has written is exercised, the Fund 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 Fund'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, a Fund will purchase a put
option on a futures contract to hedge the Fund's portfolio against the risk of
rising interest rates.

To the extent that interest rates move in an unexpected direction, a
Fund may not achieve the anticipated benefits of futures contracts or options on
futures contracts or may realize a loss. For example, if a Fund 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 Fund 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 Fund 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. A Fund 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, a Fund may seek
to close out an 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.

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Options on Foreign Currencies
Each Fund may purchase and write options on foreign currencies for
hedging purposes in a manner similar to that in which futures contracts on
foreign currencies, or forward contracts, will be utilized. For example, a
decline in the dollar value of a foreign currency in which portfolio securities
are denominated will reduce the dollar value of such securities, even if their
value in the foreign currency remains constant. In order to protect against such
diminutions in the value of portfolio securities, a Fund may purchase put
options on the foreign currency. If the value of the currency does decline, a
Fund will have the right to sell such currency for a fixed amount in dollars and
will thereby offset, in whole or in part, the adverse effect on its portfolio
which otherwise would have resulted.

Conversely, where a rise in the dollar value of a currency in which
securities to be acquired are denominated is projected, thereby increasing the
cost of such securities, a Fund may purchase call options thereon. The purchase
of such options could offset, at least partially, the effects of the adverse
movement in exchange rates. As in the case of other types of options, however,
the benefit to a Fund deriving from purchases of foreign currency options will
be reduced by the amount of the premium and related transaction costs. In
addition, where currency exchange rates do not move in the direction or to the
extent anticipated, a Fund could sustain losses on transactions in foreign
currency options which would require it to forego a portion or all of the
benefits of advantageous changes in such rates.

A Fund may write options on foreign currencies for the same types of
hedging purposes. For example, where a Fund anticipates a decline in the dollar
value of foreign currency denominated securities due to adverse fluctuations in
exchange rates, it could, instead of purchasing a put option, write a call
option on the relevant currency. If the expected decline occurs, the option will
most likely not be exercised, and the diminution in the value of portfolio
securities will be offset by the amount of the premium received.

Similarly, instead of purchasing a call option to hedge against an
anticipated increase in the dollar cost of securities to be acquired, a Fund
could write a put option on the relevant currency which, if rates move in the
manner projected, will expire unexercised and allow a Fund to hedge such
increased cost up to the amount of the premium. As in the case of other types of
options, however, the writing of a foreign currency option will constitute only
a partial hedge up to the amount of the premium, and only if rates move in the
expected direction. If this does not occur, the option may be exercised and the
Fund would be required to purchase or sell the underlying currency at a loss
which may not be offset by the amount of the premium. Through the writing of
options on foreign currencies, a Fund also may be required to forego all or a
portion of the benefit which might otherwise have been obtained from favorable
movements in exchange rates.

Each Fund intends to write covered call options on foreign currencies.
A call option written on a foreign currency by a Fund is "covered" if the Fund
owns the underlying foreign currency covered by the call or has an absolute and
immediate right to acquire that foreign currency without additional cash
consideration (or for additional cash consideration held in a segregated account
by the Custodian Bank) upon conversion or exchange of other foreign currency
held in its portfolio. A call option is also covered if the Fund has a call on
the same foreign currency and in the same principal amount as the call written
where the exercise price of the call held (a) is equal to or less than the
exercise price of the call written, or (b) is greater than the exercise price of
the call written if the difference is maintained by the Fund in cash, U.S.
government securities or other high-grade liquid debt securities in a segregated
account with its Custodian Bank.

With respect to writing put options, at the time the put is written, a
Fund will establish a segregated account with its Custodian Bank consisting of
cash, U.S. government securities or other high-grade liquid debt

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<PAGE>

securities in an amount equal in value to the amount the Fund will be required
to pay upon exercise of the put. The account will be maintained until the put is
exercised, has expired, or the Fund has purchased a closing put of the same
series as the one previously written.

Options on Stock Indices
A stock index assigns relative values to the common stocks included in
the index with the index fluctuating with changes in the market values of the
underlying common stock.

Options on stock indices are similar to options on stocks but have
different delivery requirements. Stock options provide the right to take or make
delivery of the underlying stock at a specified price. A stock index option
gives the holder the right to receive a cash "exercise settlement amount" equal
to (i) the amount by which the fixed exercise price of the option exceeds (in
the case of a put) or is less than (in the case of a call) the closing value of
the underlying index on the date of exercise, multiplied by (ii) a fixed "index
multiplier." Receipt of this cash amount will depend upon the closing level of
the stock index upon which the option is based being greater than (in the case
of a call) or less than (in the case of a put) the exercise price of the option.
The amount of cash received will be equal to such difference between the closing
price of the index and exercise price of the option expressed in dollars times a
specified multiple. The writer of the option is obligated, in return for the
premium received, to make delivery of this amount. Gain or loss to a Fund on
transactions in stock index options will depend on price movements in the stock
market generally (or in a particular industry or segment of the market) rather
than price movements of individual securities.

As with stock options, a Fund may offset its position in stock index
options prior to expiration by entering into a closing transaction on an
Exchange or it may let the option expire unexercised.

A stock index fluctuates with changes in the market values of the stock
so included. Some stock index options are based on a broad market index such as
the Standard and Poor's 500 (R) Composite Stock Price Index ("S&P 500") or the
New York Stock Exchange Composite Index, or a narrower market index such as the
Standard & Poor's 100 Index ("S&P 100"). Indices are also based on an industry
or market segment such as the AMEX Oil and Gas Index or the Computer and
Business Equipment Index. Options on stock indices are currently traded on
domestic exchanges such as: The Chicago Board Options Exchange, the New York
Stock Exchange and American Stock Exchange as well as on foreign exchanges.

A Fund's ability to hedge effectively all or a portion of its
securities through transactions in options on stock indices depends on the
degree to which price movements in the underlying index correlate with price
movements in the Fund's portfolio securities. Since a Fund's portfolio will not
duplicate the components of an index, the correlation will not be exact.
Consequently, a Fund bears the risk that the prices of the securities being
hedged will not move in the same amount as the hedging instrument. It is also
possible that there may be a negative correlation between the index or other
securities which would result in a loss on both such securities and the hedging
instrument.

Positions in stock index options may be closed out only on an Exchange
which provides a secondary market. There can be no assurance that a liquid
secondary market will exist for any particular stock index option. Thus, it may
not be possible to close such an option. The inability to close options
positions could have an adverse impact on a Fund's ability effectively to hedge
its securities. A Fund will enter into an option position only if there appears
to be a liquid secondary market for such options.

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A Fund will not engage in transactions in options on stock indices for
speculative purposes but only to protect appreciation attained and to take
advantage of the liquidity available in the option markets.

Rule 144A Securities
A Fund may invest in restricted securities, including unregistered
securities eligible for resale without registration pursuant to Rule 144A ("Rule
144A Securities") under the 1933 Act. Rule 144A Securities may be freely traded
among qualified institutional investors without registration under the 1933 Act.

Investing in Rule 144A Securities could have the effect of increasing
the level of a Fund's illiquidity to the extent that qualified institutional
buyers become, for a time, uninterested in purchasing these securities. After
the purchase of a Rule 144A Security, however, the Board of Directors and the
Manager will continue to monitor the liquidity of that security to ensure that a
Fund has no more than 15% of its net assets in illiquid securities.

Non-Traditional Equity Securities
New Europe Fund and Latin American Fund may each invest in convertible
preferred stocks that offer enhanced yield features, such as Preferred Equity
Redemption Cumulative Stock ("PERCS"), which provide an investor, such as the
Funds, 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, 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 holder 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.

New Europe Fund and Latin America Fund 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 preset 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.

Additional Risks Relating to Russian Securities
The New Europe Fund may invest to a limited degree in Russian
Securities. Investing in Russian companies involves a high degree of risk and
special considerations not typically associated with investing in the U.S.
securities markets, and should be considered highly speculative. Such risks
include: (1) delays in settling portfolio transactions and risk of loss arising
out of Russia's system of share registration and custody; (2) the risk

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that it may be impossible or more difficult than in other countries to obtain
and/or enforce a judgment; (3) pervasiveness of corruption and crime in the
Russian economic system; (4) currency exchange rate volatility and the lack of
available currency hedging instruments; (5) higher rates of inflation (including
the risk of social unrest associated with periods of hyper-inflation);
(6) controls on foreign investment and local practices disfavoring foreign
investors and limitations on repatriation of invested capital, profits and
dividends, and on the New Europe Fund's ability to exchange local currencies for
U.S. dollars; (7) the risk that the government of Russia or other executive or
legislative bodies may decide not to continue to support the economic reform
programs implemented since the dissolution of the Soviet Union and could follow
radically different political and/or economic policies to the detriment of
investors, including non-market-oriented policies such as the support of certain
industries at the expense of other sectors or investors, or a return to the
centrally planned economy that existed prior to the dissolution of the Soviet
Union; (8) the financial condition of Russian companies, including large amounts
of inter-company debt which may create a payments crisis on a national scale;
(9) dependency on exports and the corresponding importance of international
trade; (10) the risk that the Russian tax system will not be reformed to prevent
inconsistent, retroactive and/or exorbitant taxation; and (11) possible
difficulty in identifying a purchaser of securities held by the New Europe Fund
due to the underdeveloped nature of the securities markets.

There is little historical data on Russian securities markets because
they are relatively new and a substantial proportion of securities transactions
in Russia are privately negotiated outside of stock exchanges. Because of the
recent formation of the securities markets as well as the underdeveloped state
of the banking and telecommunications systems, settlement, clearing and
registration of securities transactions are subject to significant risks.
Ownership of shares (except where shares are held through depositories that meet
the requirements of the 1940 Act) is defined according to entries in the
company's share register and normally evidenced by extracts from the register or
by formal share certificates. However, there is no central registration system
for shareholders and these services are carried out by the companies themselves
or by registrars located throughout Russia. These registrars are not necessarily
subject to effective state supervision and it is possible for the New Europe
Fund to lose its registration through fraud, negligence or even mere oversight.
In addition, while applicable Russian regulations impose liability on registrars
for losses resulting from their errors, it may be difficult for the Fund to
enforce any rights it may have against the registrar or issuer of the securities
in the event of loss of share registration. Furthermore, although a Russian
public enterprise with more than 1,000 shareholders is required by law to
contract out the maintenance of its shareholder register to an independent
entity that meets certain criteria, in practice this regulation has not always
been strictly enforced. Because of this lack of independence, management of a
company may be able to exert considerable influence over who can purchase and
sell the company's shares by illegally instructing the registrar to refuse to
record transactions in the share register. This practice may prevent the New
Europe Fund from investing in the securities of certain Russian companies deemed
suitable by the Investment Manager. Further, this also could cause a delay in
the sale of Russian company securities by the Fund if a potential purchaser is
deemed unsuitable, which may expose the Fund to potential loss on the
investment.

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ACCOUNTING AND TAX ISSUES

When a Fund writes a call, or purchases a put option, an amount equal
to the premium received or paid by it is included in the Fund's assets and
liabilities as an asset and as an equivalent liability.

In writing a call, the amount of the liability is subsequently "marked
to market" to reflect the current market value of the option written. The
current market value of a written option is the last sale price on the principal
Exchange on which such option is traded or, in the absence of a sale, the mean
between the last bid and asked prices. If an option which a Fund has written
expires on its stipulated expiration date, the Fund recognizes a capital gain.
If a Fund enters into a closing purchase transaction with respect to an option
which the Fund has written, the Fund realizes a gain (or loss if the cost of the
closing transaction exceeds the premium received when the option was sold)
without regard to any unrealized gain or loss on the underlying security, and
the liability related to such option is extinguished. If a call option which a
Fund has written is exercised, the Fund realizes a capital gain or loss from the
sale of the underlying security and the proceeds from such sale are increased by
the premium originally received.

The premium paid by a Fund for the purchase of a put option is recorded
in the Fund's assets and liabilities as an investment and subsequently adjusted
daily to the current market value of the option. For example, if the current
market value of the option exceeds the premium paid, the excess would be
unrealized appreciation and, conversely, if the premium exceeds the current
market value, such excess would be unrealized depreciation. The current market
value of a purchased option is the last sale price on the principal Exchange on
which such option is traded or, in the absence of a sale, the mean between the
last bid and asked prices. If an option which a Fund has purchased expires on
the stipulated expiration date, the Fund realizes a short-term or long-term
capital loss for federal income tax purposes in the amount of the cost of the
option. If a Fund exercises a put option, it realizes a capital gain or loss
(long-term or short-term, depending on the holding period of the underlying
security) from the sale of the underlying security and the proceeds from such
sale will be decreased by the premium originally paid.

Options on Certain Stock Indices
Accounting for options on certain stock indices will be in accordance
with generally accepted accounting principles. The amount of any realized gain
or loss on closing out such a position will result in a realized gain or loss
for tax purposes. Such options held by a Fund at the end of each fiscal year on
a broad-based stock index will be required to be "marked to market" for federal
income tax purposes. Generally, 60% of any net gain or loss recognized on such
deemed sales or on any actual sales will be treated as long-term capital gain or
loss, and the remainder will be treated as short-term capital gain or loss.

Other Tax Requirements
Each Fund has qualified, and intends to continue to qualify, as a
regulated investment company under Subchapter M of the Code. As such, a Fund
will not be subject to federal income tax, or to any excise tax, to the extent
its earnings are distributed as provided in the Code and it satisfies other
requirements relating to the sources of its income and diversification of its
assets.

In order to qualify as a regulated investment company for federal
income tax purposes, each Fund must meet certain specific requirements,
including:

(i) A Fund must maintain a diversified portfolio of securities, wherein
no security (other than U.S. government securities and securities of other
regulated investment companies) can exceed 25% of that Fund's total

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assets, and, with respect to 50% of that Fund's total assets, no investment
(other than cash and cash items, U.S. government securities and securities of
other regulated investment companies) can exceed 5% of that Fund's total assets;

(ii) A Fund must derive at least 90% of its gross income from
dividends, interest, payments with respect to securities loans, and gains from
the sale or disposition of stock and securities or foreign currencies, or other
income derived with respect to its business of investing in such stock,
securities, or currencies; and

(iii) A Fund must distribute to its shareholders at least 90% of its
investment company taxable income and net tax-exempt income for each of its
fiscal years.

The Code requires a Fund to distribute at least 98% of its taxable
ordinary income earned during the calendar year and 98% of its capital gain net
income earned during the 12 month period ending October 31 (in addition to
amounts from the prior year that were neither distributed nor taxed to such
Fund) to shareholders by December 31 of each year in order to avoid federal
excise taxes. The Funds intend as a matter of policy to declare and pay
sufficient dividends in December or January (which are treated by shareholders
as received in December) but does not guarantee and can give no assurances that
its distributions will be sufficient to eliminate all such taxes.

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 year that unrealized losses exceed unrealized gains.

The federal income tax rules governing the taxation of interest rate
swaps are not entirely clear and may require Global Bond Fund to treat payments
received under such arrangements as ordinary income and to amortize such
payments under certain circumstances. Global Bond Fund will limit its activity
in this regard in order to maintain its qualification as a regulated investment
company.

The 1997 Act has also added new provisions for dealing with
transactions that are generally called "Constructive Sale Transactions." Under
these rules, the Fund must recognize gain (but not loss) on any constructive
sale of an appreciated financial position in stock, a partnership interest or
certain debt instruments. The Fund will generally be treated as making a
constructive sale when it: 1) enters into a short sale on the same or
substantially identical property; 2) enters into an offsetting notional
principal contract; or 3) enters into a futures or forward contract to deliver
the same or substantially identical property. Other transactions (including
certain financial instruments called collars) will be treated as constructive
sales as provided in Treasury regulations to be published. There are also
certain exceptions that apply for transactions that are closed before the end of
the 30th day after the close of the taxable year.

Investment in Foreign Currencies and Foreign Securities--The Funds are
authorized to invest certain limited amounts in foreign securities. Such
investments, if made, will have the following additional tax consequences to
each Fund:

Under the Code, gains or losses attributable to fluctuations in foreign
currency exchange rates which occur between the time a Fund accrues income
(including dividends), or accrues expenses which are denominated in a foreign
currency, and the time a Fund actually collects such income or pays such
expenses generally are treated as ordinary income or loss. Similarly, on the
disposition of debt securities denominated in a foreign

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<PAGE>

currency and on the disposition of certain options, futures, forward contracts,
gain or loss attributable to fluctuations in the value of foreign currency
between the date of acquisition of the security or contract and the date of its
disposition are also treated as ordinary gain or loss. These gains or losses,
referred to under the Code as "Section 988" gains or losses, may increase or
decrease the amount of a Fund's net investment company taxable income, which, in
turn, will affect the amount of income to be distributed to you by a Fund.

If a Fund's Section 988 losses exceed a Fund's other investment company
taxable income during a taxable year, a Fund generally will not be able to make
ordinary dividend distributions to you for that year, or distributions made
before the losses were realized will be recharacterized as return of capital
distributions for federal income tax purposes, rather than as an ordinary
dividend or capital gain distribution. If a distribution is treated as a return
of capital, your tax basis in your Fund shares will be reduced by a like amount
(to the extent of such basis), and any excess of the distribution over your tax
basis in your Fund shares will be treated as capital gain to you.

The 1997 Act generally requires that foreign income be translated into
U.S. dollars at the average exchange rate for the tax year in which the
transactions are conducted. Certain exceptions apply to taxes paid more than two
years after the taxable year to which they relate. This new law may require a
Fund to track and record adjustments to foreign taxes paid on foreign securities
in which it invests. Under a Fund's current reporting procedure, foreign
security transactions are recorded generally at the time of each transaction
using the foreign currency spot rate available for the date of each transaction.
Under the new law, a Fund will be required to record at fiscal year end (and at
calendar year end for excise tax purposes) an adjustment that reflects the
difference between the spot rates recorded for each transaction and the year-end
average exchange rate for all of a Fund's foreign securities transactions. There
is a possibility that the mutual fund industry will be given relief from this
new provision, in which case no year-end adjustments will be required.

The Funds may be subject to foreign withholding taxes on income from
certain of its foreign securities. If more than 50% of the total assets of a
Fund at the end of its fiscal year are invested in securities of foreign
corporations, a Fund may elect to pass-through to you your pro rata share of
foreign taxes paid by a Fund. If this election is made, you will be: (i)
required to include in your gross income your pro rata share of foreign source
income (including any foreign taxes paid by a Fund); and (ii) entitled to either
deduct your share of such foreign taxes in computing your taxable income or to
claim a credit for such taxes against your U.S. income tax, subject to certain
limitations under the Code. You will be informed by a Fund at the end of each
calendar year regarding the availability of any such foreign tax credits and the
amount of foreign source income (including any foreign taxes paid by a Fund). If
a Fund elects to pass-through to you the foreign income taxes that it has paid,
you will be informed at the end of the calendar year of the amount of foreign
taxes paid and foreign source income that must be included on your federal
income tax return. If a Fund invests 50% or less of its total assets in
securities of foreign corporations, it will not be entitled to pass-through to
you your pro-rata shares of foreign taxes paid by a Fund. In this case, these
taxes will be taken as a deduction by a Fund, and the income reported to you
will be the net amount after these deductions. The 1997 Act also simplifies the
procedures by which investors in funds that invest in foreign securities can
claim tax credits on their individual income tax returns for the foreign taxes
paid by a Fund. These provisions will allow investors who pay foreign taxes of
$300 or less on a single return or $600 or less on a joint return during any
year (all of which must be reported on IRS Form 1099-DIV from a Fund to the
investor) to claim a tax credit against their U.S. federal income tax for the
amount of foreign taxes paid by a Fund. This process will allow you, if you
qualify, to bypass the burdensome and detailed reporting requirements on the
foreign tax credit schedule (Form 1116) and report your foreign taxes paid
directly on page 2 of Form 1040. You should note that this simplified procedure
will not be available until calendar year 1998.

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Investment in Passive Foreign Investment Company securities--The Funds
may invest in shares of foreign corporations which may be classified under the
Code as passive foreign investment companies ("PFICs"). In general, a foreign
corporation is classified as a PFIC if at least one-half of its assets
constitute investment-type assets or 75% or more of its gross income is
investment-type income. If a Fund receives an "excess distribution" with respect
to PFIC stock, the Fund itself may be subject to U.S. federal income tax on a
portion of the distribution, whether or not the corresponding income is
distributed by a Fund to you. In general, under the PFIC rules, an excess
distribution is treated as having been realized ratably over the period during
which a Fund held the PFIC shares. A Fund itself will be subject to tax on the
portion, if any, of an excess distribution that is so allocated to prior Fund
taxable years, and an interest factor will be added to the tax, as if the tax
had been payable in such prior taxable years. In this case, you would not be
permitted to claim a credit on your own tax return for the tax paid by a Fund.
Certain distributions from a PFIC as well as gain from the sale of PFIC shares
are treated as excess distributions. Excess distributions are characterized as
ordinary income even though, absent application of the PFIC rules, certain
distribution might have been classified as capital gain. This may have the
effect of increasing Fund distributions to you that are treated as ordinary
dividends rather than long-term capital gain dividends.

A Fund may be eligible to elect alternative tax treatment with respect
to PFIC shares. Under an election that currently is available in some
circumstances, a Fund generally would be required to include in its gross income
its share of the earnings of a PFIC on a current basis, regardless of whether
distributions are received from the PFIC during such period. If this election
were made, the special rules, discussed above, relating to the taxation of
excess distributions, would not apply. In addition, the 1997 Act provides for
another election that would involve marking-to-market the Fund's PFIC shares at
the end of each taxable year (and on certain other dates as prescribed in the
Code), with the result that unrealized gains would be treated as though they
were realized. The Fund would also be allowed an ordinary deduction for the
excess, if any, of the adjusted basis of its investment in the PFIC stock over
its fair market value at the end of the taxable year. This deduction would be
limited to the amount of any net mark-to-market gains previously included with
respect to that particular PFIC security. If a Fund were to make this second
PFIC election, tax at the Fund level under the PFIC rules would generally be
eliminated.

The application of the PFIC rules may affect, among other things, the
amount of tax payable by a Fund (if any), the amounts distributable to you by a
Fund, the time at which these distributions must be made, and whether these
distributions will be classified as ordinary income or capital gain
distributions to you.

You should be aware that it is not always possible at the time shares
of a foreign corporation are acquired to ascertain that the foreign corporation
is a PFIC, and that there is always a possibility that a foreign corporation
will become a PFIC after a Fund acquires shares in that corporation. While a
Fund will generally seek to avoid investing in PFIC shares to avoid the tax
consequences detailed above, there are no guarantees that it will do so and it
reserves the right to make such investments as a matter of its fundamental
investment policy.

Most foreign exchange gains are classified as ordinary income which
will be taxable to you as such when distributed. Similarly, you should be aware
that any foreign exchange losses realized by a Fund, including any losses
realized on the sale of foreign debt securities, are generally treated as
ordinary losses for federal income tax purposes. This treatment could increase
or reduce a Fund's income available for distribution to you, and may cause some
or all of a Fund's previously distributed income to be classified as a return of
capital.

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<PAGE>

PERFORMANCE INFORMATION

From time to time, each Fund may state its Classes' total return and
yield in advertisements and other types of literature. Any statement of total
return performance data for a Class will be accompanied by information on the
average annual compounded rate of return for that Class over, as relevant, the
most recent one-, five- and ten-year, or life-of-fund periods, as applicable.
Each Fund may also advertise aggregate and average total return information for
its Classes over additional periods of time. In addition, each Fund may include
illustrations showing the power of compounding in advertisements and other types
of literature.

In presenting performance information for Class A Shares, the Limited
CDSC or other CDSC, applicable only to certain redemptions of those shares, will
not be deducted from any computation of total return. See the Prospectuses for
the Fund Classes for a description of the Limited CDSC or other CDSC and the
limited instances in which it applies. All references to a CDSC in this
Performance Information section will apply to Class B Shares or Class C Shares.

The average annual total rate of return for each Class is based on a
hypothetical $1,000 investment that includes capital appreciation and
depreciation during the stated periods. The following formula will be used for
the actual computations:

n
P(1 + T) = ERV

Where: P = a hypothetical initial purchase order of $1,000 from which,
in the case of only Class A Shares, the maximum front-end
sales charge is deducted;

T = average annual total return;

n = number of years;

ERV = redeemable value of the hypothetical $1,000 purchase at the
end of the period after the deduction of the applicable
CDSC, if any, with respect to Class B Shares and Class C
Shares.

Aggregate or cumulative total return is calculated in a similar manner,
except that the results are not annualized. Each calculation assumes the maximum
front-end sales charge, if any, is deducted from the initial $1,000 investment
at the time it is made with respect to Class A Shares and that all distributions
are reinvested at net asset value, and, with respect to Class B Shares and Class
C Shares, reflects the deduction of the CDSC that would be applicable upon
complete redemption of such shares. In addition, each Fund may present total
return information that does not reflect the deduction of the maximum front-end
sales charge or any applicable CDSC.

Each Fund may also state total return performance for its Classes in
the form of an average annual return. This average annual return figure will be
computed by taking the sum of a Class' annual returns, then dividing that figure
by the number of years in the overall period indicated. The computation will
reflect the impact of the maximum front-end sales charge or CDSC, if any, paid
on the illustrated investment amount against the first year's return. From time
to time, each Fund may quote actual total return performance for its Classes 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

-18-

<PAGE>

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.

Performance information for the Funds is not provided because they are
new funds with no operating history.

Total return performance for a Class will be computed by adding all
reinvested income and realized securities profits distributions plus the change
in net asset value during a specific period and dividing by the offering price
at the beginning of the period. It will also reflect, as applicable, the maximum
front-end sales charge or CDSC paid with respect to the illustrated investment
amount, but not any income taxes payable by shareholders on the reinvested
distributions included in the calculation. Because securities prices fluctuate,
past performance should not be considered as a representation of the results
which may be realized from an investment in a Fund in the future.

From time to time, each Fund may also quote its Classes' actual total
return performance, dividend results and other performance information in
advertising and other types of literature. This information may be compared to
that of other mutual funds with similar investment objectives and to stock, bond
and other relevant indices or to rankings prepared by independent services or
other financial or industry publications that monitor the performance of mutual
funds. For example, the performance of a Fund (of Fund Class) may be compared to
data prepared by Lipper Analytical Services, Inc., Morningstar, Inc., or to the
S&P 500 Index, the Dow Jones Industrial Average, the Morgan Stanley Capital
International (MSCI), Europe, Australia and Far East (EAFE) Index, the MSCI
Emerging Markets Free Index, MSCI Emerging Markets Free Latin America Index, the
MSCI Europe, or the Salomon Brothers World Government Bond Index.

Lipper Analytical Services, Inc. maintains statistical performance
databases, as reported by a diverse universe of independently-managed mutual
funds. Morningstar, Inc. is a mutual fund rating service that rates mutual funds
on the basis of risk-adjusted performance. Rankings that compare a Fund's
performance to another fund in appropriate categories over specific time periods
also may be quoted in advertising and other types of literature. The S&P 500 and
the Dow Jones Industrial Average are industry-accepted unmanaged indices of
generally-conservative securities used for measuring general market performance.
Similarly, the MSCI EAFE Index, the MSCI Emerging Markets Free Index, and the
Salomon Brothers World Government Bond Index are industry-accepted unmanaged
indices of equity securities in developed countries and global debt securities,
respectively, used for measuring general market performance. The total return
performance reported for these indices will reflect the reinvestment of all
distributions on a quarterly basis and market price fluctuations. The indices do
not take into account any sales charges or other fees. A direct investment in an
unmanaged index is not possible.

Comparative information on the Consumer Price Index may also be
included in advertisements or other literature. The Consumer Price Index, as
prepared by the U.S. Bureau of Labor Statistics, is the most commonly used
measure of inflation. It indicates the cost fluctuations of a representative
group of consumer goods. It does not represent a return from an investment.

Each Fund may also promote its Classes' yield and/or total return
performance and use comparative performance information computed by and
available from certain industry and general market research and publications,
such as Lipper Analytical Services, Inc., IBC/Donoghue's Money Market Report and
Morningstar, Inc.

-19-

<PAGE>

The performance of multiple indices compiled and maintained by
statistical research firms, such as Morgan Stanley, Salomon Brothers and Lehman
Brothers, may be combined to create a blended performance result for comparative
purposes. Generally, the indices selected will be representative of the types of
securities in which the Funds may invest and the assumptions that were used in
calculating the blended performance will be described.

Ibbotson Associates of Chicago, Illinois ("Ibbotson") provides
historical returns of the capital markets in the United States, including common
stocks, small capitalization stocks, long-term corporate bonds,
intermediate-term government bonds, long-term government bonds, Treasury bills,
the U.S. rate of inflation (based on the Consumer Price Index), and combinations
of various capital markets. The performance of these capital markets is based on
the returns of different indices. The Funds may use the performance of these
capital markets in order to demonstrate general risk-versus-reward investment
scenarios. Performance comparisons may also include the value of a hypothetical
investment in any of these capital markets. The risks associated with the
security types in any capital market may or may not correspond directly to those
of the Funds. The Funds may also compare performance to that of other
compilations or indices that may be developed and made available in the future.

The Funds may include discussions or illustrations of the potential
investment goals of a prospective investor (including materials that describe
general principles of investing, such as asset allocation, diversification, risk
tolerance, and goal setting, questionnaires designed to help create a personal
financial profile, worksheets used to project savings needs based on assumed
rates of inflation and hypothetical rates of return and action plans offering
investment alternatives), investment management techniques, policies or
investment suitability of a Fund (such as value investing, market timing, dollar
cost averaging, asset allocation, constant ratio transfer, automatic account
rebalancing, the advantages and disadvantages of investing in tax-deferred and
taxable investments or global or international investments), economic and
political conditions, the relationship between sectors of the economy and the
economy as a whole, the effects of inflation and historical performance of
various asset classes, including but not limited to, stocks, bonds and Treasury
bills. From time to time advertisements, sales literature, communications to
shareholders or other materials may summarize the substance of information
contained in shareholder reports (including the investment composition of a
Fund), as well as the views as to current market, economic, trade and interest
rate trends, legislative, regulatory and monetary developments, investment
strategies and related matters believed to be of relevance to a Fund. In
addition, selected indices may be used to illustrate historic performance of
selected asset classes. The Funds may also include in advertisements, sales
literature, communications to shareholders or other materials, charts, graphs or
drawings which illustrate the potential risks and rewards of investment in
various investment vehicles, including but not limited to, domestic and
international stocks, and/or bonds, treasury bills and shares of a Fund. In
addition, advertisements, sales literature, communicatins to shareholders or
other materials may include a discussion of certain attributes or benefits to be
derived by an investment in a Fund and/or other mutual funds, shareholder
profiles and hypothetical investor scenarios, timely information on financial
management, tax and retirement planning (such as information on Roth IRAs and
Educational IRAs) and investment alternatives to certificates of deposit and
other financial instruments. Such sales literature, communications to
shareholders or other materials may include symbols, headlines or other material
which highlight or summarize the information discussed in more detail therein.

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<PAGE>

Materials may refer to the CUSIP numbers of the Funds and may
illustrate how to find the listings of the Funds in newspapers and periodicals.
Materials may also include discussions of other Funds, products, and services.

The Funds may quote various measures of volatility and benchmark
correlation in advertising. In addition, the Funds may compare these measures to
those of other funds. Measures of volatility seek to compare the historical
share price fluctuations or total returns to those of a benchmark. Measures of
benchmark correlation indicate how valid a comparative benchmark may be.
Measures of volatility and correlation may be calculated using averages of
historical data. A Fund may advertise its current interest rate sensitivity,
duration, weighted average maturity or similar maturity characteristics.
Advertisements and sales materials relating to a Fund may include information
regarding the background and experience of its portfolio managers.

Because every investor's goals and risk threshold are different, the
Distributor, as distributor for Global Funds, Inc. and other Delaware
Investments mutual funds, will provide general information about investment
alternatives and scenarios that will allow investors to assess their personal
goals. This information will include general material about investing as well as
materials reinforcing various industry-accepted principles of prudent and
responsible personal financial planning. One typical way of addressing these
issues is to compare an individual's goals and the length of time the individual
has to attain these goals to his or her risk threshold. In addition, the
Distributor may also provide information that discusses the overriding
investment philosophy of Delaware Management Company ("Delaware"), or Delaware
Investment Advisers ("DIA"), both series of Delaware Management Business Trust,
and the Manager, an affiliate of Delaware, and how that philosophy impacts Fund
investment disciplines and strategies employed in seeking each Fund's
objectives. The Distributor may also from time to time cite general or specific
information about the institutional clients of Delaware or DIA or the Manager,
including the number of such clients serviced by Delaware, DIA and/or the
Manager.

Dollar-Cost Averaging
For many people, deciding when to invest can be a difficult decision.
Security prices tend to move up and down over various market cycles and logic
says to invest when prices are low. However, even experts can't always pick the
highs and the lows. By using a strategy known as dollar-cost averaging, you
schedule your investments ahead of time. If you invest a set amount on a regular
basis, that money will always buy more shares when the price is low and fewer
when the price is high. You can choose to invest at any regular interval--for
example, monthly or quarterly--as long as you stick to your regular schedule.
Dollar-cost averaging looks simple and it is, but there are important things to
remember.

Dollar-cost averaging works best over longer time periods, and it
doesn't guarantee a profit or protect against losses in declining markets. If
you need to sell your investment when prices are low, you may not realize a
profit no matter what investment strategy you utilize. That's why dollar-cost
averaging can make sense for long-term goals. Since the potential success of a
dollar-cost averaging program depends on continuous investing, even through
periods of fluctuating prices, you should consider your dollar-cost averaging
program a long-term commitment and invest an amount you can afford and probably
won't need to withdraw. You also should consider your financial ability to
continue to purchase shares during periods of high fund share prices. Delaware
Investments offers three services -- Automatic Investing Program, Direct Deposit
Program and the Wealth Builder Option -- that can help to keep your regular
investment program on track. See Investing by Electronic Fund Transfer - Direct
Deposit Purchase Plan and Automatic Investing Plan under Investment Plans and
Wealth Builder Option under Investment Plans for a complete description of these
services, including restrictions or limitations.

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<PAGE>

The example below illustrates how dollar-cost averaging can work. In a
fluctuating market, the average cost per share over a period of time will be
lower than the average price per share for the same time period.

Number
Investment Price Per of Shares
Amount Share Purchased
Month 1 $100 $10.00 10
Month 2 $100 $12.50 8
Month 3 $100 $5.00 10
Month 4 $100 $10.00 20
- ------------------------------------------------------------------------------
$400 $37.50 48

Total Amount Invested: $400
Total Number of Shares Purchased: 48
Average Price Per Share: $9.38 ($37.50/4)
Average Cost Per Share: $8.33 ($400/48 shares)

This example is for illustration purposes only. It is not intended to
represent the actual performance of any stock or bond fund offered by Delaware
Investments.

THE POWER OF COMPOUNDING
When you opt to reinvest your current income for additional Fund
shares, your investment is given yet another opportunity to grow. It's called
the Power of Compounding. Each Fund may include illustrations showing the power
of compounding in advertisements and other types of literature.

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<PAGE>

TRADING PRACTICES AND BROKERAGE

The Manager selects brokers or dealers to execute transactions on
behalf of each Fund 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
a Fund either buys securities directly from the dealer or sells them to the
dealer. In these instances, there is no direct commission charged but there is a
spread (the difference between the buy and sell price) which is the equivalent
of a commission. When a commission is paid, the Fund involved pays reasonably
competitive brokerage commission rates based upon the professional knowledge of
the Manager as to rates paid and charged for similar transactions throughout the
securities industry. In some instances, the Fund may pay a minimal share
transaction cost when the transaction presents no difficulty.

The Manager may allocate out of all commission business generated by
all of the funds and accounts under its management, brokerage business to
brokers or dealers who provide brokerage and research services. These services
include advice, either directly or through publications or writings, as to the
value of securities, the advisability of investing in, purchasing or selling
securities, and the availability of securities or purchasers or sellers of
securities; furnishing of analyses and reports concerning issuers, securities or
industries; providing information on economic factors and trends; assisting in
determining portfolio strategy; providing computer software and hardware used in
security analyses; and providing portfolio performance evaluation and technical
market analyses. Such services are used by the Manager in connection with its
investment decision-making process with respect to one or more funds and
accounts managed by it, and may not be used, or used exclusively, with respect
to the fund or account generating the brokerage.

As provided in the Securities Exchange Act of 1934 (the "1934 Act") and
each Fund's Investment Management Agreement, higher commissions are permitted to
be paid to broker/dealers who provide brokerage and research services than to
broker/dealers who do not provide such services if such higher commissions are
deemed reasonable in relation to the value of the brokerage and research
services provided. Although transactions are directed to broker/dealers who
provide such brokerage and research services, the Funds believe that the
commissions paid to such broker/dealers are not, in general, higher than
commissions that would be paid to broker/dealers not providing such services and
that such commissions are reasonable in relation to the value of the brokerage
and research services provided. In some instances, services may be provided to
the Manager which constitute in some part brokerage and research services used
by the Manager in connection with its investment decision-making process and
constitute in some part services used by the Manager in connection with
administrative or other functions not related to its investment decision-making
process. In such cases, the Manager will make a good faith allocation of
brokerage and research services and will pay out of its own resources for
services used by the Manager in connection with administrative or other
functions not related to its investment decision-making process. In addition, so
long as no fund is disadvantaged, portfolio transactions which generate
commissions or their equivalent are allocated to broker/dealers who provide
daily portfolio pricing services to a Fund and to other Delaware Investments
funds. 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.

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<PAGE>

The Manager may place a combined order for two or more accounts or
funds engaged in the purchase or sale of the same security if, in its judgment,
joint execution is in the best interest of each participant and will result
in best price and execution. Transactions involving commingled orders are
allocated in a manner deemed equitable to each account or fund. When a combined
order is executed in a series of transactions at different prices, each account
participating in the order may be allocated an average price obtained from the
executing broker. It is believed that the ability of the accounts to participate
in volume transactions will generally be beneficial to the accounts and funds.
Although it is recognized that, in some cases, the joint execution of orders
could adversely affect the price or volume of the security that a particular
account or fund may obtain, it is the opinion of the Manager and Global Funds,
Inc.'s Board of Directors that the advantages of combined orders outweigh the
possible disadvantages of separate transactions.

Consistent with the Conduct Rules of the National Association of
Securities Dealers, Inc. (the "NASD"), and subject to seeking best price and
execution, a Fund may place orders with broker/dealers that have agreed to
defray certain expenses of the funds offered by Delaware Investments such as
custodian fees, and may, at the request of the Distributor, give consideration
to sales of shares of such funds as a factor in the selection of brokers and
dealers to execute Fund portfolio transactions.

Portfolio Turnover
A Fund 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 its investment objective. A
Fund will not attempt to achieve or be limited to a predetermined rate of
portfolio turnover, such a turnover always being incidental to transactions
undertaken with a view to achieving a Fund's investment objective.

The degree of portfolio activity may affect brokerage costs of a Fund
and taxes payable by a Fund's shareholders. A turnover rate of 100% would occur,
for example, if all the investments in the Fund's portfolio at the beginning of
the year were replaced by the end of the year. In investing for capital
appreciation, a Fund may hold securities for any period of time. Portfolio
turnover will also be increased if a Fund writes a large number of call options
which are subsequently exercised. To the extent a Fund realizes gains on
securities held for less than twelve months, such gains are taxable to the
shareholder or to the Fund at ordinary income tax rates. The turnover rate also
may be affected by cash requirements from redemptions and repurchases of Fund
shares. Total brokerage costs generally increase with higher portfolio turnover
rates.

Under certain market conditions, a Fund may experience a rate of
portfolio turnover which could exceed 100%. Each Fund's portfolio turnover rate
is calculated by dividing the lesser of purchases or sales of portfolio
securities for the particular fiscal year by the monthly average of the value of
the portfolio securities owned by the Fund during the particular fiscal year,
exclusive of securities whose maturities at the time of acquisition are one year
or less.

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<PAGE>

PURCHASING SHARES

The Distributor serves as the national distributor for each Fund's
shares and has agreed to use its best efforts to sell shares of each Fund. See
the Prospectuses for additional information on how to invest. Shares of each
Fund are offered on a continuous basis and may be purchased through authorized
investment dealers or directly by contacting Global Funds, Inc. or the
Distributor.

The minimum initial investment generally is $1,000 for Class A Shares,
Class B Shares and Class C Shares. Subsequent purchases of such Classes
generally must be at least $100. The initial and subsequent investment minimums
for Class A Shares will be waived for purchases by officers, directors and
employees of any Delaware Investments fund, the Manager or any of their
affiliates if the purchases are made pursuant to a payroll deduction program.
Shares purchased pursuant to the Uniform Gifts to Minors Act or Uniform
Transfers to Minors Act and shares purchased in connection with an Automatic
Investing Plan are subject to a minimum initial purchase of $250 and a minimum
subsequent purchase of $25. Accounts opened under the Delaware Investments Asset
Planner service are subject to a minimum initial investment of $2,000 per Asset
Planner Strategy selected. There are no minimum purchase requirements for the
Institutional Classes, but certain eligibility requirements must be satisfied.

Each purchase of Class B Shares is subject to a maximum purchase
limitation of $250,000. For Class C Shares, each purchase must be in an amount
that is less than $1,000,000. See Investment Plans for purchase limitations
applicable to retirement plans. Global Funds, Inc. will reject any purchase
order for more than $250,000 of Class B Shares and $1,000,000 or more of Class C
Shares. An investor may exceed these limitations by making cumulative purchases
over a period of time. An investor should keep in mind, however, that reduced
front-end sales charges apply to investments of $50,000 or more in Class A
Shares and that, absent any applicable fee waiver, Class A Shares are subject to
lower annual 12b-1 Plan expenses than Class B Shares and Class C Shares and
generally are not subject to a CDSC.

Selling dealers are responsible for transmitting orders promptly.
Global Funds, Inc. reserves the right to reject any order for the purchase of
its shares of a Fund if in the opinion of management such rejection is in such
Fund's best interest.

The NASD has adopted amendments to its Conduct Rules, as amended,
relating to investment company sales charges. Global Funds, Inc. and the
Distributor intend to operate in compliance with these rules.

Class A Shares are purchased at the offering price which reflects a
maximum front-end sales charge of 5.75%; however, lower front-end sales charges
apply for larger purchases. See the table below. Class A Shares, absent any
applicable fee waiver, are also subject to annual 12b-1 Plan expenses.

Class B Shares are purchased at net asset value and are subject to a
CDSC of: (i) 5% if shares are redeemed within the first year of purchase; (ii)
4% if shares are redeemed during the second year of purchase; (iii) 3% if shares
are redeemed during the third or fourth year following purchase; (iv) 2% if
shares are redeemed during the fifth year following purchase; and (v) 1% if
shares are redeemed during the sixth year following purchase. Class B Shares are
also subject to annual 12b-1 Plan expenses which, absent any applicable fee
waiver, are higher than those to which Class A Shares are subject and are
assessed against the Class B Shares for approximately eight years after
purchase. See Automatic Conversion of Class B Shares under Classes of Shares in
the Fund Classes' Prospectuses.

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<PAGE>

Class C Shares are purchased at net asset value and are subject to a
CDSC of 1% if shares are redeemed within 12 months following purchase. Class C
Shares, absent any applicable fee waiver, are also subject to annual 12b-1 Plan
expenses for the life of the investment which are equal to those to which Class
B Shares are subject.

The Distributor has voluntarily elected to waive the payment of 12b-1
plan expenses by New Europe Fund and Latin America Fund from the commencement of
the public offering through May 31, 1999. As a result, the Fund Classes of the
New Europe Fund and Latin America Fund will not incur any 12b-1 Plan expenses
during such period.

Institutional Class shares are purchased at the net asset value per
share without the imposition of a front-end or contingent deferred sales charge
or 12b-1 Plan expenses. See Plans Under Rule 12b-1 for the Fund Classes under
Purchasing Shares, and Determining Offering Price and Net Asset Value in this
Part B.

Class A Shares, Class B Shares, Class C Shares and Institutional Class
shares represent a proportionate interest in a Fund's assets and will receive a
proportionate interest in that Fund's income, before application, as to Class A,
Class B and Class C Shares, of any expenses under that Fund's 12b-1 Plans.

Certificates representing shares purchased are not ordinarily issued
unless, in the case of Class A Shares or Institutional Class shares, a
shareholder submits a specific request. Certificates are not issued in the case
of Class B Shares or Class C Shares or in the case of any retirement plan
account including self-directed IRAs. However, purchases not involving the
issuance of certificates are confirmed to the investor and credited to the
shareholder's account on the books maintained by Delaware Service Company, Inc.
(the "Transfer Agent"). The investor will have the same rights of ownership with
respect to such shares as if certificates had been issued. An investor that is
permitted to obtain a certificate may receive a certificate representing full
share denominations purchased by sending a letter signed by each owner of the
account to the Transfer Agent requesting the certificate. No charge is assessed
by Global Funds, Inc. for any certificate issued. A shareholder may be subject
to fees for replacement of a lost or stolen certificate under certain
conditions, including the cost of obtaining a bond covering the lost or stolen
certificate. Please contact the Funds for further information. Investors who
hold certificates representing any of their shares may only redeem those shares
by written request. The investor's certificate(s) must accompany such request.

Alternative Purchase Arrangements
The alternative purchase arrangements of Class A Shares, Class B Shares
and Class C Shares permit investors to choose the method of purchasing shares
that is most suitable for their needs given the amount of their purchase, the
length of time they expect to hold their shares and other relevant
circumstances. Investors should determine whether, given their particular
circumstances, it is more advantageous to purchase Class A Shares and incur a
front-end sales charge and, absent any applicable fee waiver, annual 12b-1 Plan
expenses of up to a maximum of 0.30% of the average daily net assets of Class A
Shares or to purchase either Class B or Class C Shares and have the entire
initial purchase amount invested in the Fund with the investment thereafter
subject to a CDSC and, absent any applicable fee waiver, annual 12b-1 Plan
expenses. Class B Shares are subject to a CDSC if the shares are redeemed within
six years of purchase, and Class C Shares are subject to a CDSC if the shares
are redeemed within 12 months of purchase. Class B and Class C Shares are each
subject to annual 12b-1 Plan expenses of up to a maximum of 1% (0.25% of which
are service fees to be paid to the Distributor, dealers or others for providing
personal service and/or maintaining shareholder accounts) of average daily net
assets of the respective Class. Class B Shares will automatically convert to
Class A Shares at the end of approximately eight years after purchase and,
thereafter, be subject to annual 12b-1 Plan expenses of up to a maximum of 0.30%
of average daily net assets of such shares. Unlike Class B Shares, Class C
Shares do not convert to another class.

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<PAGE>

Class A Shares
Purchases of $50,000 or more of Class A Shares at the offering price
carry reduced front-end sales charges and may include a series of purchases over
a 13-month period under a Letter of Intention signed by the purchaser. See
Special Purchase Features - Class A Shares, below, for more information on ways
in which investors can avail themselves of reduced front-end sales charges and
other purchase features.

Certain dealers who enter into an agreement to provide extra training
and information on Delaware Investments products and services and who increase
sales of Delaware Investments funds may receive an additional commission of up
to 0.15% of the offering price in connection with sales of Class A Shares. Such
dealers must meet certain requirements in terms of organization and distribution
capabilities and their ability to increase sales. The Distributor should be
contacted for further information on these requirements as well as the basis and
circumstances upon which the additional commission will be paid. Participating
dealers may be deemed to have additional responsibilities under the securities
laws.

Dealer's Commission
As described more fully in the Prospectuses for the Fund Classes, for
initial purchases of Class A Shares of $1,000,000 or more, a dealer's commission
may be paid by the Distributor to financial advisers through whom such purchases
are effected. See Front-End Sales Charge Alternative - Class A Shares in the
Prospectuses for the Fund Classes for the applicable schedule and further
details.

Contingent Deferred Sales Charge - Class B Shares and Class C Shares
Class B Shares and Class C Shares are purchased without a front-end
sales charge. Class B Shares redeemed within six years of purchase may be
subject to a CDSC at the rates set forth above, and Class C Shares redeemed
within 12 months of purchase may be subject to a CDSC of 1%. CDSCs are charged
as a percentage of the dollar amount subject to the CDSC. The charge will be
assessed on an amount equal to the lesser of the net asset value at the time of
purchase of the shares being redeemed or the net asset value of those shares at
the time of redemption. No CDSC will be imposed on increases in net asset value
above the initial purchase price, nor will a CDSC be assessed on redemptions of
shares acquired through reinvestment of dividends or capital gains
distributions. See Waiver of Contingent Deferred Sales Charge--Class B Shares
and Class C Shares under Redemption and Exchange in the Prospectuses for the
Fund Classes for a list of the instances in which the CDSC is waived. During the
seventh year after purchase and, thereafter, until converted automatically into
Class A Shares, Class B Shares, absent any applicable fee waiver, will still be
subject to the annual 12b-1 Plan expenses of up to 1% of average daily net
assets of those shares. At the end of approximately eight years after purchase,
the investor's Class B Shares will be automatically converted into Class A
Shares the same Fund. See Automatic Conversion of Class B Shares under Classes
of Shares in the Fund Classes' Prospectuses. Such conversion will constitute a
tax-free exchange for federal income tax purposes. See Taxes in the Prospectuses
for the Fund Classes.

Plans Under Rule 12b-1 for the Fund Classes
Pursuant to Rule 12b-1 under the 1940 Act, Global Funds, Inc. has
adopted a separate plan for each of the Class A Shares, the Class B Shares and
the Class C Shares of a Fund (the "Plans"). Each Plan permits the relevant Fund
to pay for certain distribution, promotional and related expenses involved in
the marketing of only the Classes of shares to which the Plan applies. The Plans
do not apply to Institutional Classes of shares. Such shares are not included in
calculating the Plans' fees, and the Plans are not used to assist in the
distribution and marketing of shares of the Institutional Classes. Shareholders
of the Institutional Classes may not vote on matters affecting the Plans.

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The Plans permit a Fund, pursuant to its Distribution Agreement, to pay
out of the assets of the Class A Shares, Class B Shares and Class C Shares
monthly fees to the Distributor for its services and expenses in distributing
and promoting sales of shares of such classes. These expenses include, among
other things, preparing and distributing advertisements, sales literature and
prospectuses and reports used for sales purposes, compensating sales and
marketing personnel, and paying distribution and maintenance fees to securities
brokers and dealers who enter into dealer's agreements with the Distributor. The
Plan expenses relating to Class B Shares and Class C Shares are also used to pay
the Distributor for advancing the commission costs to dealers with respect to
the initial sale of such shares.

In addition, absent any applicable fee waiver, each Fund may make
payments out of the assets of the Class A Shares, Class B Shares and Class C
Shares directly to other unaffiliated parties, such as banks, who either aid in
the distribution of shares of, or provide services to, such classes.

The maximum aggregate fee payable by a Fund under its Plans and a
Fund's Distribution Agreement, is on an annual basis, up to 0.30% of average
daily net assets of Class A Shares, and up to 1% (0.25% of which are service
fees to be paid to the Distributor, dealers and others for providing personal
service and/or maintaining shareholder accounts) of Class B Shares' and Class C
Shares' average daily net assets for the year. Global Funds, Inc.'s Board of
Directors may reduce these amounts at any time.

All of the distribution expenses incurred by the Distributor and
others, such as broker/dealers, in excess of the amount paid on behalf of Class
A Shares, Class B Shares and Class C Shares would be borne by such persons
without any reimbursement from such classes. Subject to seeking best price and
execution, a Fund may, from time to time, buy or sell portfolio securities from
or to firms which receive payments under the Plans.

From time to time, the Distributor may pay additional amounts from its
own resources to dealers for aid in distribution or for aid in providing
administrative services to shareholders.

The Plans and the Distribution Agreements, as amended, have all been
approved by the Board of Directors of Global Funds, Inc., including a majority
of the directors who are not "interested persons" (as defined in the 1940 Act)
of Global Funds, Inc. and who have no direct or indirect financial interest in
the Plans, by vote cast in person at a meeting duly called for the purpose of
voting on the Plans and such Agreements. Continuation of the Plans and the
Distribution Agreements, as amended, must be approved annually by the Board of
Directors in the same manner as specified above.

Each year, the directors must determine whether continuation of the
Plans is in the best interest of shareholders of, respectively, Class A Shares,
Class B Shares and Class C Shares of each Fund and that there is a reasonable
likelihood of the Plan relating to a Class providing a benefit to that Class.
The Plans and the Distribution Agreements, as amended, may be terminated at any
time without penalty by a majority of those directors who are not "interested
persons" or by a majority vote of the relevant Class' outstanding voting
securities. Any amendment materially increasing the percentage payable under the
Plans must likewise be approved by a majority vote of the relevant Class'
outstanding voting securities, as well as by a majority vote of those directors
who are not "interested persons." With respect to each Class A Shares' Plan any
material increase in the maximum percentage payable thereunder must also be
approved by a majority of the outstanding voting securities of the respective
Fund's B Class. Also, any other material amendment to the Plans must be approved
by a majority vote of the directors including a majority of the noninterested
directors of Global Funds, Inc. having no interest in the Plans. In addition, in
order for the Plans to remain effective, the selection and nomination of
directors who are not "interested persons" of Global Funds, Inc. must be
effected by the directors who themselves

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are not "interested persons" and who have no direct or indirect financial
interest in the Plans. Persons authorized to make payments under the Plans must
provide written reports at least quarterly to the Board of Directors for its
review.

Other Payments to Dealers - Class A Shares, Class B Shares and Class C Shares
From time to time, at the discretion of the Distributor, all registered
broker/dealers whose aggregate sales of Fund Classes exceed certain limits as
set by the Distributor, may receive from the Distributor an additional payment
of up to 0.25% of the dollar amount of such sales. The Distributor may also
provide additional promotional incentives or payments to dealers that sell
shares of the Delaware Investments funds. In some instances, these incentives or
payments may be offered only to certain dealers who maintain, have sold or may
sell certain amounts of shares. The Distributor may also pay a portion of the
expense of preapproved dealer advertisements promoting the sale of Delaware
Investments fund shares.

Special Purchase Features - Class A Shares

Buying Class A Shares at Net Asset Value
Class A Shares may be purchased without a front-end sales charge under
the Dividend Reinvestment Plan and, under certain circumstances, the Exchange
Privilege and the 12-Month Reinvestment Privilege.

Current and former officers, directors and employees of Global Funds,
Inc., any other fund offered by Delaware Investments, including the Manager,
legal counsel to the funds and registered representatives and employees of
broker/dealers who have entered into Dealer's Agreements with the Distributor
may purchase Class A Shares of the Funds and any such Class of shares of any of
the other funds offered by Delaware Investments, including any fund that may be
created, at the net asset value per share. Family members (regardless of age) of
such persons at their direction, and any employee benefit plan established by
any of the foregoing funds, corporations, counsel or broker/dealers may also
purchase Class A Shares at net asset value. Class A Shares may also be purchased
at net asset value by current and former officers, directors and employees (and
members of their families) of the Dougherty Financial Group LLC.

Purchases of Class A Shares may also be made by clients of registered
representatives of an authorized investment dealer at net asset value within 12
months after the registered representative changes employment, if the purchase
is funded by proceeds from an investment where a front-end sales charge,
contingent deferred sales charge or other sales charge has been assessed.
Purchases of Class A Shares may also be made at net asset value by bank
employees who provide services in connection with agreements between the bank
and unaffiliated brokers or dealers concerning sales of shares of Delaware
Investments funds. Officers, directors and key employees of institutional
clients of the Manager or any of their affiliates may purchase Class A Shares at
net asset value. Moreover, purchases may be effected at net asset value for the
benefit of the clients of brokers, dealers and registered investment advisers
affiliated with a broker or dealer, if such broker, dealer or investment adviser
has entered into an agreement with the Distributor providing specifically for
the purchase of Class A Shares in connection with special investment products,
such as wrap accounts or similar fee based programs. Such purchasers are
required to sign a letter stating that the purchase is for investment only and
that the securities may not be resold except to the issuer. Such purchasers may
also be required to sign or deliver such other documents as Global Funds, Inc.
may reasonably require to establish eligibility for purchase at net asset value.

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Purchases of Class A Shares at net asset value may also be made by the
following: financial institutions investing for the account of their customers
when they are not eligible to purchase shares of the Institutional Class of a
Fund; and any group retirement plan (excluding defined benefit pension plans),
or such plans of the same employer, for which plan participant records are
maintained on the Retirement Financial Services, Inc., ("RFSI") proprietary
record keeping system that (i) has in excess of $500,000 of plan assets invested
in Class A Shares of Delaware Investments funds and in any stable value product
available through Delaware Investments, or (ii) is sponsored by an employer that
has at any point after May 1, 1997 more than 100 employees while such plan has
held Class A Shares of a Delaware Investments fund and such employer has
properly represented to RFSI in writing that it has the requisite number of
employees and has received written confirmation back from RFSI.

Investors in Delaware-Voyageur Unit Investment Trusts may reinvest
monthly dividend checks and/or repayment of invested capital into Class A Shares
of any of the funds offered by Delaware Investments at net asset value.

Global Funds, Inc. must be notified in advance that the trade qualifies
for purchase at net asset value.

Letter of Intention
The reduced front-end sales charges described above with respect to
Class A Shares are also applicable to the aggregate amount of purchases made
within a 13-month period pursuant to a written Letter of Intention provided by
the Distributor and signed by the purchaser, and not legally binding on the
signer or Global Funds, Inc., which provides for the holding in escrow by the
Transfer Agent of 5% of the total amount of Class A Shares intended to be
purchased until such purchase is completed within the 13-month period. A Letter
of Intention may be dated to include shares purchased up to 90 days prior to the
date the Letter is signed. The 13-month period begins on the date of the
earliest purchase. If the intended investment is not completed, except as noted
below, the purchaser will be asked to pay an amount equal to the difference
between the front-end sales charge on Class A Shares purchased at the reduced
rate and the front-end sales charge otherwise applicable to the total shares
purchased. If such payment is not made within 20 days following the expiration
of the 13-month period, the Transfer Agent will surrender an appropriate number
of the escrowed shares for redemption in order to realize the difference. Such
purchasers may include the value (at offering price at the level designated in
their Letter of Intention) of all their shares of a Fund and of any class of any
of the other mutual funds offered by Delaware Investments (except shares of any
Delaware Investments fund which do not carry a front-end sales charge, CDSC or
Limited CDSC, other than shares of Delaware Group Premium Fund, Inc.
beneficially owned in connection with the ownership of variable insurance
products, unless they were acquired through an exchange from a Delaware
Investments fund which carried a front-end sales charge, CDSC or Limited CDSC)
previously purchased and still held as of the date of their Letter of Intention
toward the completion of such Letter. For purposes of satisfying an investor's
obligation under a Letter of Intention, Class B Shares and Class C Shares of a
Fund and the corresponding classes of shares of other Delaware Investments funds
which offer such shares may be aggregated with Class A Shares of the Fund and
the corresponding class of shares of the other Delaware Investments funds.

Employers offering a Delaware Investments retirement plan may also
complete a Letter of Intention to obtain a reduced front-end sales charge on
investments of Class A Shares made by the plan. The aggregate investment level

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of the Letter of Intention will be determined and accepted by the Transfer Agent
at the point of plan establishment. The level and any reduction in front-end
sales charge will be based on actual plan participation and the projected
investments in Delaware Investments funds that are offered with a front-end
sales charge, CDSC or Limited CDSC for a 13-month period. The Transfer Agent
reserves the right to adjust the signed Letter of Intention based on this
acceptance criteria. The 13-month period will begin on the date this Letter of
Intention is accepted by the Transfer Agent. If actual investments exceed the
anticipated level and equal an amount that would qualify the plan for further
discounts, any front-end sales charges will be automatically adjusted. In the
event this Letter of Intention is not fulfilled within the 13-month period, the
plan level will be adjusted (without completing another Letter of Intention) and
the employer will be billed for the difference in front-end sales charges due,
based on the plan's assets under management at that time. Employers may also
include the value (at offering price at the level designated in their Letter of
Intention) of all their shares intended for purchase that are offered with a
front-end sales charge, CDSC or Limited CDSC of any class. Class B Shares and
Class C Shares of a Fund and other Delaware Investments funds which offer
corresponding classes of shares may also be aggregated for this purpose.

Combined Purchases Privilege
In determining the availability of the reduced front-end sales charge
previously set forth with respect to Class A Shares, purchasers may combine the
total amount of any combination of Class A Shares, Class B Shares and/or Class C
Shares of the Funds, as well as shares of any other class of any of the other
Delaware Investments funds (except shares of any Delaware Investments fund which
do not carry a front-end sales charge, CDSC or Limited CDSC, other than shares
of Delaware Group Premium Fund, Inc. beneficially owned in connection with the
ownership of variable insurance products, unless they were acquired through an
exchange from a Delaware Investments fund which carried a front-end sales
charge, CDSC or Limited CDSC). In addition, assets held by investment advisory
clients of the Manager or its affiliates in a stable value account may be
combined with other Delaware Investments fund holdings.

The privilege also extends to all purchases made at one time by an
individual; or an individual, his or her spouse and their children under 21; or
a trustee or other fiduciary of trust estates or fiduciary accounts for the
benefit of such family members (including certain employee benefit programs).

Right of Accumulation
In determining the availability of the reduced front-end sales charge
with respect to Class A Shares, purchasers may also combine any subsequent
purchases of Class A Shares, Class B Shares and Class C Shares of a Fund as well
as shares of any other class of any of the other Delaware Investments funds
which offer such classes (except shares of any Delaware Investments fund which
do not carry a front-end sales charge, CDSC or Limited CDSC, other than shares
of Delaware Group Premium Fund, Inc. beneficially owned in connection with the
ownership of variable insurance products, unless they were acquired through an
exchange from shares from a Delaware Investments fund which carried a front-end
sales charge, CDSC or Limited CDSC). If, for example, any such purchaser has
previously purchased and still holds Class A Shares and/or shares of any other
of the classes described in the previous sentence with a value of $40,000 and
subsequently purchases $10,000 at offering price of additional shares of Class A
Shares, the charge applicable to the $10,000 purchase would currently be 4.75%.
For the purpose of this calculation, the shares presently held shall be valued
at the public offering price that would have been in effect were the shares
purchased simultaneously with the current purchase. Investors should refer to
the table of sales charges for Class A Shares to determine the applicability of
the Right of Accumulation to their particular circumstances.

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12-Month Reinvestment Privilege
Holders of Class A Shares of a Fund (and of Institutional Classes
holding shares which were acquired through an exchange from one of the other
Delaware Investments mutual funds offered with a front-end sales charge) who
redeem such shares have one year from the date of redemption to reinvest all or
part of their redemption proceeds in Class A Shares of that Fund or in Class A
Shares of any of the other Delaware Investments funds, subject to applicable
eligibility and minimum purchase requirements, in states where shares of such
other funds may be sold, at net asset value without the payment of a front-end
sales charge. This privilege does not extend to Class A Shares where the
redemption of the shares triggered the payment of a Limited CDSC. Persons
investing redemption proceeds from direct investments in Delaware Investments
mutual funds offered without a front-end sales charge will be required to pay
the applicable sales charge when purchasing Class A Shares. The reinvestment
privilege does not extend to a redemption of either Class B Shares or Class C
Shares.

Any such reinvestment cannot exceed the redemption proceeds (plus any
amount necessary to purchase a full share). The reinvestment will be made at the
net asset value next determined after receipt of remittance. A redemption and
reinvestment could have income tax consequences. It is recommended that a tax
adviser be consulted with respect to such transactions. Any reinvestment
directed to a fund in which the investor does not then have an account will be
treated like all other initial purchases of a Fund's shares. Consequently, an
investor should obtain and read carefully the prospectus for the fund in which
the investment is intended to be made before investing or sending money. The
prospectus contains more complete information about the fund, including charges
and expenses.

Investors should consult their financial advisers or the Transfer
Agent, which also serves as the Funds' shareholder servicing agent, about the
applicability of the Limited CDSC (see Contingent Deferred Sales Charge for
Certain Redemptions of Class A Shares Purchased at Net Asset Value under
Redemption and Exchange in the Fund Classes' Prospectuses) in connection with
the features described above.

Group Investment Plans
Group Investment Plans that are not eligible to purchase shares of the
Institutional Classes may also benefit from the reduced front-end sales charges
for investments in Class A Shares set forth in the Prospectuses for Fund
Classes, based on total plan assets. If a company has more than one plan
investing in the Delaware Investments funds, then the total amount invested in
all plans would be used in determining the applicable front-end sales charge
reduction upon each purchase, both initial and subsequent, upon notification to
the Fund in which the investment is being made at the time of each such
purchase. Employees participating in such Group Investment Plans may also
combine the investments made in their plan account when determining the
applicable front-end sales charge on purchases to non-retirement Delaware
Investments investment accounts if they so notify the Fund in which the
investment is being made in connection with each purchase. See Retirement Plans
for the Fund Classes under Investment Plans for information about Retirement
Plans.

Institutional Classes
The Institutional Class of each Fund is available for purchase only by:
(a) retirement plans introduced by persons not associated with brokers or
dealers that are primarily engaged in the retail securities business and
rollover individual retirement accounts from such plans; (b) tax-exempt employee
benefit plans of the Manager or their affiliates and securities dealer firms
with a selling agreement with the Distributor; (c) institutional advisory
accounts of the Manager or its affiliates, and those having client relationships
with DIA (an affiliate of the Manager) or its affiates, and their corporate
sponsors, as well as subsidiaries and related employee benefit plans and
rollover individual retirement accounts from such institutional advisory
accounts; (d) a bank, trust company and similar financial institution investing
for its own account or for the account of its trust customers for whom

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such financial institution is exercising investment discretion in purchasing
shares of the Class, except where the investment is part of a program that
requires payment to the financial institution of a Rule 12b-1 Plan fee; and (e)
registered investment advisers investing on behalf of clients that consist
solely of institutions and high net-worth individuals having at least $1,000,000
entrusted to the adviser for investment purposes, but only if the adviser is not
affiliated or associated with a broker or dealer and derives compensation for
its services exclusively from its clients for such advisory services.

Shares of Institutional Classes are available for purchase at net asset
value, without the imposition of a front-end or contingent deferred sales charge
and are not subject to Rule 12b-1 expenses.

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INVESTMENT PLANS

Reinvestment Plan/Open Account
All dividends and distributions of each Class of the Funds are
reinvested in the accounts of the holders of such shares (based on the net asset
value in effect on the reinvestment date). A confirmation of each dividend
payment from net investment income and of distributions from realized securities
profits, if any, will be mailed to shareholders in the first quarter of the
fiscal year.

Under the Reinvestment Plan/Open Account, shareholders may purchase and
add full and fractional shares to their plan accounts at any time either through
their investment dealers or by sending a check or money order to the specific
Fund and Class in which the shares are being purchased. Such purchases, which
must meet the minimum subsequent purchase requirements set forth in the
Prospectuses and this Part B, are made, for Class A Shares at the public
offering price, and for Class B Shares, Class C Shares and Institutional Class
shares at the net asset value, at the end of the day of receipt. A reinvestment
plan may be terminated at any time. This plan does not assure a profit nor
protect against depreciation in a declining market.

Reinvestment of Dividends in Other Delaware Investments Funds
Subject to applicable eligibility and minimum initial purchase
requirements and the limitations set forth below, holders of Class A Shares,
Class B Shares and Class C Shares may automatically reinvest dividends and/or
distributions in any of the Delaware Investments mutual funds, including the
Funds, in states where their shares may be sold. Such investments will be at net
asset value at the close of business on the reinvestment date without any
front-end sales charge or service fee. The shareholder must notify the Transfer
Agent in writing and must have established an account in the fund into which the
dividends and/or distributions are to be invested. Any reinvestment directed to
a fund in which the investor does not then have an account will be treated like
all other initial purchases of a fund's shares. Consequently, an investor should
obtain and read carefully the prospectus for the fund in which the investment is
intended to be made before investing or sending money. The prospectus contains
more complete information about the fund, including charges and expenses. See
also Additional Methods of Adding to Your Investment - Dividend Reinvestment
Plan under How to Buy Shares in the Prospectuses for the Fund Classes.

Subject to the following limitations, dividends and/or distributions
from other funds offered by Delaware Investments may be invested in shares of
the Funds, provided an account has been established. Dividends from Class A
Shares may not be directed to Class B Shares or Class C Shares. Dividends from
Class B Shares may only be directed to other Class B Shares and dividends from
Class C Shares may only be directed to other Class C Shares.

Investing by Electronic Fund Transfer
Direct Deposit Purchase Plan--Investors may arrange for any Fund to
accept for investment in Class A Shares, Class B Shares or Class C Shares,
through an agent bank, preauthorized government or private recurring payments.
This method of investment assures the timely credit to the shareholder's account
of payments such as social security, veterans' pension or compensation benefits,
federal salaries, Railroad Retirement benefits, private payroll checks,
dividends, and disability or pension fund benefits. It also eliminates lost,
stolen and delayed checks.

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Automatic Investing Plan--Shareholders of Class A Shares, Class B
Shares and Class C Shares may make automatic investments by authorizing, in
advance, monthly payments directly from their checking account for deposit into
their Fund account. This type of investment will be handled in either of the
following ways. (1) If the shareholder's bank is a member of the National
Automated Clearing House Association ("NACHA"), the amount of the investment
will be electronically deducted from his or her account by Electronic Fund
Transfer ("EFT"). The shareholder's checking account will reflect a debit each
month at a specified date although no check is required to initiate the
transaction. (2) If the shareholder's bank is not a member of NACHA, deductions
will be made by preauthorized checks, known as Depository Transfer Checks.
Should the shareholder's bank become a member of NACHA in the future, his or her
investments would be handled electronically through EFT.

* * *

Initial investments under the Direct Deposit Purchase Plan and the
Automatic Investing Plan must be for $250 or more and subsequent investments
under such plans must be for $25 or more. An investor wishing to take advantage
of either service must complete an authorization form. Either service can be
discontinued by the shareholder at any time without penalty by giving written
notice.

Payments to a Fund from the federal government or its agencies on
behalf of a shareholder may be credited to the shareholder's account after such
payments should have been terminated by reason of death or otherwise. Any such
payments are subject to reclamation by the federal government or its agencies.
Similarly, under certain circumstances, investments from private sources may be
subject to reclamation by the transmitting bank. In the event of a reclamation,
a Fund may liquidate sufficient shares from a shareholder's account to reimburse
the government or the private source. In the event there are insufficient shares
in the shareholder's account, the shareholder is expected to reimburse the Fund.

Direct Deposit Purchases by Mail
Shareholders may authorize a third party, such as a bank or employer,
to make investments directly to their Fund accounts. A Fund will accept these
investments, such as bank-by-phone, annuity payments and payroll allotments, by
mail directly from the third party. Investors should contact their employers or
financial institutions who in turn should contact Global Funds, Inc. for proper
instructions.

Wealth Builder Option
Shareholders can use the Wealth Builder Option to invest in the Fund
Classes through regular liquidations of shares in their accounts in other mutual
funds offered by Delaware Investments. Shareholders of the Fund Classes may
elect to invest in one or more of the other mutual funds offered by Delaware
Investments through the Wealth Builder Option. See Wealth Builder Option and
Redemption and Exchange in the Prospectus for the Fund Classes.

Under this automatic exchange program, shareholders can authorize
regular monthly investments (minimum of $100 per fund) to be liquidated from
their account and invested automatically into other Delaware Investments mutual
funds, subject to the conditions and limitations set forth in the Fund Classes'
Prospectus. The investment will be made on the 20th day of each month (or, if
the fund selected is not open that day, the next business day) at the public
offering price or net asset value, as applicable, of the fund selected on the
date of

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investment. No investment will be made for any month if the value of the
shareholder's account is less than the amount specified for investment.

Periodic investment through the Wealth Builder Option does not insure
profits or protect against losses in a declining market. The price of the fund
into which investments are made could fluctuate. Since this program involves
continuous investment regardless of such fluctuating value, investors selecting
this option should consider their financial ability to continue to participate
in the program through periods of low fund share prices. This program involves
automatic exchanges between two or more fund accounts and is treated as a
purchase of shares of the fund into which investments are made through the
program. See Exchange Privilege for a brief summary of the tax consequences of
exchanges. Shareholders can terminate their participation in Wealth Builder at
any time by giving written notice to the fund from which exchanges are made.

Delaware Investments Asset Planner
To invest in Delaware Investments funds using the Delaware Investments
Asset Planner asset allocation service, you should complete a Delaware
Investments Asset Planner Account Registration Form, which is available only
from a financial adviser or investment dealer. Effective September 1, 1997, the
Delaware Investments Asset Planner Service is only available to financial
advisers or investment dealers who have previously used this service. The
Delaware Investments Asset Planner service offers a choice of four predesigned
asset allocation strategies (each with a different risk/reward profile) in
predetermined percentages in Delaware Investments funds. With the help of a
financial adviser, you may also design a customized asset allocation strategy.

The sales charge on an investment through the Asset Planner service is
determined by the individual sales charges of the underlying funds and their
percentage allocation in the selected Strategy. Exchanges from existing Delaware
Investments accounts into the Asset Planner service may be made at net asset
value under the circumstances described under Investing by Exchange in the
Prospectus. Also see Buying Class A Shares at Net Asset Value under Classes of
Shares. The minimum initial investment per Strategy is $2,000; subsequent
investments must be at least $100. Individual fund minimums do not apply to
investments made using the Asset Planner service. Class A Shares, Class B Shares
and Class C Shares are available through the Asset Planner service. Generally,
only shares within the same class may be used within the same Strategy. However,
Class A Shares of a Fund and of other Delaware Investments funds may be used in
the same Strategy with consultant class shares that are offered by certain other
Delaware Investments funds.

An annual maintenance fee, currently $35 per Strategy, is due at the
time of initial investment and by September 30 of each subsequent year. The fee,
payable to Delaware Service Company, Inc. to defray extra costs associated with
administering the Asset Planner service, will be deducted automatically from one
of the funds within your Asset Planner account if not paid by September 30.
However, the annual maintenance fee is being waived until further notice.
Investors who utilize the Asset Planner for an IRA will continue to pay an
annual IRA fee of $15 per Social Security number. Investors will receive a
customized quarterly Strategy Report summarizing all Delaware Investments Asset
Planner investment performance and account activity during the prior period.
Confirmation statements will be sent following all transactions other than those
involving a reinvestment of distributions.

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Certain shareholder services are not available to investors using the
Asset Planner service, due to its special design. These include Delaphone,
Checkwriting, Wealth Builder Option and Letter of Intention. Systematic
Withdrawal Plans are available after the account has been open for two years.

Retirement Plans for the Fund Classes
An investment in the Funds may be suitable for tax-deferred retirement
plans. Delaware Investments offers a full spectrum of retirement plans,
including the 401(k) Defined Contribution Plan, Individual Retirement Account
("IRA") and the new Roth IRA and Education IRA.

Among the retirement plans that Delaware Investments offers, Class B
Shares are available only by Individual Retirement Accounts, SIMPLE IRAs, Roth
IRAs, Education IRAs, Simplified Employee Pension Plans, Salary Reduction
Simplified Employee Pension Plans, and 403(b)(7) and 457 Deferred Compensation
Plans. The CDSC may be waived on certain redemptions of Class B Shares and Class
C Shares. See Waiver of Contingent Deferred Sales Charge - Class B Shares and
Class C Shares under Redemption and Exchange in the Prospectus for the Fund
Classes for a list of the instances in which the CDSC is waived.

Purchases of Class B Shares are subject to a maximum purchase
limitation of $250,000 for retirement plans. Purchases of Class C Shares must be
in an amount that is less than $1,000,000 for such plans. The maximum purchase
limitations apply only to the initial purchase of shares by the retirement plan.

Minimum investment limitations generally applicable to other investors
do not apply to retirement plans other than Individual Retirement Accounts, for
which there is a minimum initial purchase of $250 and a minimum subsequent
purchase of $25, regardless of which Class is selected. Retirement plans may be
subject to plan establishment fees, annual maintenance fees and/or other
administrative or trustee fees. Fees are based upon the number of participants
in the plan as well as the services selected. Additional information about fees
is included in retirement plan materials. Fees are quoted upon request. Annual
maintenance fees may be shared by Delaware Management Trust Company, the
Transfer Agent, other affiliates of the Manager and others that provide services
to such Plans.

Certain shareholder investment services available to non-retirement
plan shareholders may not be available to retirement plan shareholders. Certain
retirement plans may qualify to purchase shares of the Institutional Class
shares. See Institutional Classes, above. For additional information on any of
the plans and Delaware's retirement services, call the Shareholder Service
Center telephone number.

It is advisable for an investor considering any one of the retirement
plans described below to consult with an attorney, accountant or a qualified
retirement plan consultant. For further details, including applications for any
of these plans, contact your investment dealer or the Distributor.

Taxable distributions from the retirement plans described below may be
subject to withholding.

Please contact your investment dealer or the Distributor for the
special application forms required for the Plans described below.

Prototype Profit Sharing or Money Purchase Pension Plans
Prototype Plans are available for self-employed individuals,
partnerships, corporations and other eligible forms of organizations. These
plans can be maintained as Section 401(k), profit sharing or money purchase
pension plans. Contributions may be invested only in Class A Shares and Class C
Shares.

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Individual Retirement Account ("IRA")
A document is available for an individual who wants to establish an IRA
and make contributions which may be tax-deductible, even if the individual is
already participating in an employer-sponsored retirement plan. Even if
contributions are not deductible for tax purposes, as indicated below, earnings
will be tax-deferred. In addition, an individual may make contributions on
behalf of a spouse who has no compensation for the year; however, participation
may be restricted based on certain income limits.

IRA Disclosures
The Taxpayer Relief Act of 1997 provides new opportunities for
investors. Individuals have five types of tax-favored IRA accounts that can be
utilized depending on the individual's circumstances. A new Roth IRA and
Education IRA are available in addition to the existing deductible IRA and
non-deductible IRA.

Deductible and Non-deductible IRAs
An individual can contribute up to $2,000 in his or her IRA each year.
Contributions may or may not be deductible depending upon the taxpayer's
adjusted gross income ("AGI") and whether the taxpayer is an active participant
in an employer sponsored retirement plan. Even if a taxpayer is an active
participant in an employer sponsored retirement plan, the full $2,000 is still
available if the taxpayer's AGI is below $30,000 ($50,000 for taxpayers filing
joint returns) for years beginning after December 31, 1997. A partial deduction
is allowed for married couples with income between $50,000 and $60,000, and for
single individuals with incomes between $30,000 and $40,000. These income
phase-out limits reach $80,000-$100,000 in 2007 for joint filers and
$50,000-$60,000 in 2005 for single filers. No deductions are available for
contributions to IRAs by taxpayers whose AGI after IRA deductions exceeds the
maximum income limit established for each year and who are active participants
in an employer sponsored retirement plan.

Taxpayers who are not allowed deductions on IRA contributions still can
make non-deductible IRA contributions of as much as $2,000 for each working
spouse and defer taxes on interest or other earnings from the IRAs.

Under the new law, a married individual is not considered an active
participant in an employer sponsored retirement plan merely because the
individual's spouse is an active participant if the couple's combined AGI is
below $150,000. The maximum deductible IRA contribution for a married individual
who is not an active participant, but whose spouse is, is phased out for
combined AGI between $150,000 and $160,000.

Conduit (Rollover) IRAs
Certain individuals who have received or are about to receive eligible
rollover distributions from an employer-sponsored retirement plan or another IRA
may rollover the distribution tax-free to a Conduit IRA. The rollover of the
eligible distribution must be completed by the 60th day after receipt of the
distribution; however, if the rollover is in the form of a direct
trustee-to-trustee transfer without going through the distributee's hand, the
60-day limit does not apply.

A distribution qualifies as an "eligible rollover distribution" if it
is made from a qualified retirement plan, a 403(b) plan or another IRA and does
not constitute one of the following:

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(1) Substantially equal periodic payments over the employee's life or
life expectancy or the joint lives or life expectancies of the employee and
his/her designated beneficiary;

(2) Substantially equal installment payments for a period certain of 10
or more years;

(3) A distribution, all of which represents a required minimum
distribution after attaining age 70 1/2;

(4) A distribution due to a Qualified Domestic Relations Order to an
alternate payee who is not the spouse (or former spouse) of the employee; and

(5) A distribution of after-tax contributions which is not includable
in income.

Roth IRAs
For taxable years beginning after December 31, 1997, non-deductible
contributions of up to $2,000 per year can be made to a new Roth IRA. As a
result of the Internal Revenue Service Restructuring and Reform Act of 1998 (the
"1998 Act"), the $2,000 annual limit will not be reduced by any contributions to
a deductible or nondeductible IRA for the same year. The maximum contribution
that can be made to a Roth IRA is phased out for single filers with AGI between
$95,000 and $110,000, and for couples filing jointly with AGI between $150,000
and $160,000. Qualified distributions from a Roth IRA would be exempt from
federal taxes. Qualified distributions are distributions (1) made after the
five-taxable year period beginning with the first taxable year for which a
contribution was made to a Roth IRA and (2) that are (a) made on or after the
date on which the individual attains age 59 1/2, (b) made to a beneficiary on or
after the death of the individual, (c) attributed to the individual being
disabled, or (d) for a qualified special purpose (e.g., first time homebuyer
expenses).

Distributions that are not qualified distributions would always be
tax-free if the taxpayer is withdrawing contributions, not accumulated earnings.

Taxpayers with AGI of $100,000 or less are eligible to convert an
existing IRA (deductible, nondeductible and conduit) to a Roth IRA. Earnings and
contributions from a deductible IRA are subject to a tax upon conversion;
however, no 10% excise tax for early withdrawal would apply. If the conversion
is done prior to January 1, 1999, then the income from the conversion can be
included in income ratably over a four-year period beginning with the year of
conversion.

Education IRAs
For taxable years beginning after December 31, 1997, an Education IRA
has been created exclusively for the purpose of paying qualified higher
education expenses. Taxpayers can make non-deductible contributions up to $500
per year per beneficiary. The $500 annual limit is in addition to the $2,000
annual contribution limit applicable to IRAs and Roth IRAs. Eligible
contributions must be in cash and made prior to the date the beneficiary reaches
age 18. Similar to the Roth IRA, earnings would accumulate tax-free. There is no
requirement that the contributor be related to the beneficiary, and there is no
limit on the number of beneficiaries for whom one contributor can establish
Education IRAs. In addition, multiple Education IRAs can be created for the same
beneficiaries, however, the contribution limit of all contributions for a single
beneficiary cannot exceed $500 annually.

This $500 annual contribution limit for Education IRAs is phased out
ratably for single contributors with modified AGI between $95,000 and $110,000,

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<PAGE>

and for couples filing jointly with modified AGI of between $150,000 and
$160,000. Individuals with modified AGI above the phase-out range are not
allowed to make contributions to an Education IRA established on behalf of any
other individual.

Distributions from an Education IRA are excludable from gross income to
the extent that the distribution does not exceed qualified higher education
expenses incurred by the beneficiary during the year the distribution is made
regardless of whether the beneficiary is enrolled at an eligible educational
institution on a full-time, half-time, or less than half-time basis.

Any balance remaining in an Education IRA at the time a beneficiary
becomes 30 years old must be distributed, and the earnings portion of such a
distribution will be includible in gross income of the beneficiary and subject
to an additional 10% penalty tax if the distribution is not for qualified higher
educations expenses. Tax-free (and penalty-free) transfers and rollovers of
account balances from one Education IRA benefiting one beneficiary to another
Education IRA benefiting a different beneficiary (as well as redesignations of
the named beneficiary) is permitted, provided that the new beneficiary is a
member of the family of the old beneficiary and that the transfer or rollover is
made before the time the old beneficiary reaches age 30 and the new beneficiary
reaches age 18.

A company or association may establish a Group IRA or Group Roth IRA
for employees or members who want to purchase shares of the Fund.

Investments generally must be held in the IRA until age 59 1/2 in order
to avoid premature distribution penalties, but distributions generally must
commence no later than April 1 of the calendar year following the year in which
the participant reaches age 70 1/2. Individuals are entitled to revoke the
account, for any reason and without penalty, by mailing written notice of
revocation to Delaware Management Trust Company within seven days after the
receipt of the IRA Disclosure Statement or within seven days after the
establishment of the IRA, except, if the IRA is established more than seven days
after receipt of the IRA Disclosure Statement, the account may not be revoked.
Distributions from the account (except for the pro-rata portion of any
nondeductible contributions) are fully taxable as ordinary income in the year
received. Excess contributions removed after the tax filing deadline, plus
extensions, for the year in which the excess contributions were made are subject
to a 6% excise tax on the amount of excess. Premature distributions
(distributions made before age 59 1/2, except for death, disability and certain
other limited circumstances) will be subject to a 10% excise tax on the amount
prematurely distributed, in addition to the income tax resulting from the
distribution. For information concerning the applicability of a CDSC upon
redemption of Class B Shares and Class C Shares, see Contingent Deferred Sales
Charge - Class B Shares and Class C Shares.

Effective January 1, 1997, the 10% premature distribution penalty will
not apply to distributions from an IRA that are used to pay medical expenses in
excess of 7.5% of adjusted gross income or to pay health insurance premiums by
an individual who has received unemployment compensation for 12 consecutive
weeks. In addition, effective January 1, 1998, the new law allows for premature
distribution without a 10% penalty if (i) the amounts are used to pay qualified
higher education expenses (including graduate level courses) of the taxpayer,
the taxpayer's spouse or any child or grandchild of the taxpayer or the
taxpayer's spouse, or (ii) used to pay acquisition costs of a principle
residence for the purchase of a first-time home by the taxpayer, taxpayer's
spouse or any child or grandchild of the taxpayer or the taxpayer's spouse. A
qualified first-time homebuyer is someone who has had no ownership interest in a
residence during the past two years. The aggregate amount of distribution for
first-time home purchases cannot exceed a lifetime cap of $10,000.

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<PAGE>

Simplified Employee Pension Plan ("SEP/IRA")
A SEP/IRA may be established by an employer who wishes to sponsor a
tax-sheltered retirement program by making contributions on behalf of all
eligible employees. Each of the Classes is available for investment by a
SEP/IRA.

Salary Reduction Simplified Employee Pension Plan ("SAR/SEP")
Although new SAR/SEP plans may not be established after December 31,
1996, existing plans may continue to be maintained by employers having 25 or
fewer employees. An employer may elect to make additional contributions to such
existing plans.

Prototype 401(k) Defined Contribution Plan
Section 401(k) of the Code permits employers to establish qualified
plans based on salary deferral contributions. Effective January 1, 1997,
non-governmental tax-exempt organizations may establish 401(k) plans. Plan
documents are available to enable employers to establish a plan. An employer may
also elect to make profit sharing contributions and/or matching contributions
with investments in only Class A Shares and Class C Shares or certain other
funds in the Delaware Investments family. Purchases under the Plan may be
combined for purposes of computing the reduced front-end sales charge applicable
to Class A Shares as set forth in the table the Prospectus for the Fund Classes.

Deferred Compensation Plan for Public Schools and Non-Profit
Organizations ("403(b)(7)")
Section 403(b)(7) of the Code permits public school systems and certain
non-profit organizations to use mutual fund shares held in a custodial account
to fund deferred compensation arrangements for their employees. A custodial
account agreement is available for those employers who wish to purchase shares
of any of the Classes in conjunction with such an arrangement. Purchases under
the Plan may be combined for purposes of computing the reduced front-end sales
charge applicable to Class A Shares as set forth in the table the Prospectus for
the Fund Classes.

Deferred Compensation Plan for State and Local Government Employees ("457")
Section 457 of the Code permits state and local governments, their
agencies and certain other entities to establish a deferred compensation plan
for their employees who wish to participate. This enables employees to defer a
portion of their salaries and any federal (and possibly state) taxes thereon.
Such plans may invest in shares of the Fund. Although investors may use their
own plan, there is available a Delaware Investments 457 Deferred Compensation
Plan. Interested investors should contact the Distributor or their investment
dealers to obtain further information. Purchases under the Plan may be combined
for purposes of computing the reduced front-end sales charge applicable to Class
A Shares as set forth in the table in the Prospectus for the Fund Classes.

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<PAGE>

SIMPLE IRA
A SIMPLE IRA combines many of the features of an IRA and a 401(k) Plan
but is easier to administer than a typical 401(k) Plan. It requires employers to
make contributions on behalf of their employees and also has a salary deferral
feature that permits employees to defer a portion of their salary into the plan
on a pre-tax basis.
A SIMPLE IRA is available only to plan sponsors with 100 or fewer employees.

SIMPLE 401(k)
A SIMPLE 401(k) is like a regular 401(k) except that it is available
only to plan sponsors 100 or fewer employees and, in exchange for mandatory plan
sponsor contributions, discrimination testing is no longer required. Class B
Shares are not available for purchase by such plans.

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DETERMINING OFFERING PRICE AND NET ASSET VALUE

Orders for purchases of Class A Shares are effected at the offering
price next calculated by the Fund in which shares are being purchased after
receipt of the order by the Fund, its agent or certain other authorized persons.
See Distribution and Service under Investment Management Agreements and
Sub-Advisory Agreements. Orders for purchases of Class B Shares, Class C Shares
and Institutional Class shares are effected at the net asset value per share
next calculated by the Fund in which shares are being purchased after receipt of
the order by the Fund, its agent or certain other authorized persons. Selling
dealers are responsible for transmitting orders promptly.

The offering price for Class A Shares consists of the net asset value
per share plus any applicable front-end sales charges. Offering price and net
asset value are computed as of the close of regular trading on the New York
Stock Exchange (ordinarily, 4 p.m., Eastern time) on days when the Exchange is
open. The New York Stock Exchange is scheduled to be open Monday through Friday
throughout the year except for New Year's Day, Martin Luther King, Jr.'s
Birthday, Presidents' Day, Good Friday, Memorial Day, Independence Day, Labor
Day, Thanksgiving and Christmas. When the New York Stock Exchange is closed, the
Funds will generally be closed, pricing calculations will not be made and
purchase and redemption orders will not be processed.

An example showing how to calculate the net asset value per share and,
in the case of Class A Shares, the offering price per share, is included in the
Funds' financial statements which are incorporated by reference into this Part
B.

Each Fund's net asset value per share is computed by adding the value
of all the securities and other assets in the Fund's portfolio, deducting any
liabilities of the Fund, and dividing by the number of Fund shares outstanding.
Expenses and fees are accrued daily. In determining a Fund's total net assets,
portfolio securities primarily listed or traded on a national or foreign
securities exchange, except for bonds, are valued at the last sale price on that
exchange. Exchange traded options are valued at the last reported sale price or,
if no sales are reported, at the mean between bid and asked prices. Non-exchange
traded options are valued at fair value using a mathematical model. Futures
contracts are valued at their daily quoted settlement price. For valuation
purposes, foreign currencies and foreign securities denominated in foreign
currency values will be converted into U.S. dollar values at the mean between
the bid and offered quotations of such currencies against U.S. dollars based on
rates in effect that day. Securities not traded on a particular day,
over-the-counter securities, and government and agency securities are valued at
the mean value between bid and asked prices. Money market instruments having a
maturity of less than 60 days are valued at amortized cost. Debt securities
(other than short-term obligations) are valued on the basis of valuations
provided by a pricing service when such prices are believed to reflect the fair
value of such securities. Foreign securities and the prices of foreign
securities denominated in foreign currencies are translated to U.S. dollars
based on rates in effect as of 12 p.m., Eastern time. Use of a pricing service
has been approved by the Board of Directors. Prices provided by a pricing
service take into account appropriate factors such as institutional trading in
similar groups of securities, yield, quality, coupon rate, maturity, type of
issue, trading characteristics and other market data. Subject to the foregoing,
securities for which market quotations are not readily available and other
assets are valued at fair value as determined in good faith and in a method
approved by the Board of Directors.

Each class of a Fund will bear, pro-rata, all of the common expenses of
that Fund. The net asset values of all outstanding shares of each class of a
Fund will be computed on a pro-rata basis for each outstanding share based on
the proportionate participation in that Fund represented by the value of shares
of that class. All income earned and expenses incurred by a Fund will be borne
on a pro-rata basis by each outstanding share of a class,

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<PAGE>

based on each class' percentage in that Fund represented by the value of shares
of such classes, except that the Institutional Classes will not incur any of the
expenses under Global Funds, Inc.'s 12b-1 Plans and Class A Shares, Class B
Shares and Class C Shares alone will bear the 12b-1 Plan fees payable under
their respective Plans. Due to the specific distribution expenses and other
costs that will be allocable to each class, the net asset value of each class of
a Fund will vary. For so long as the current waivers of 12b-1 Plan expenses by
the Distributor in connection with the distribution of Class A Shares, Class B
Shares and Class C Shares of the Funds remain applicable, no such variance shall
arise.

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REDEMPTION AND REPURCHASE

Any shareholder may require a Fund to redeem shares by sending a
written request, signed by the record owner or owners exactly as the shares are
registered, to the Fund, at 1818 Market Street, Philadelphia, PA 19103. In
addition, certain expedited redemption methods described below are available
when stock certificates have not been issued. Certificates are issued for Class
A Shares and Institutional Class shares only if a shareholder specifically
requests them. Certificates are not issued for Class B Shares or Class C Shares.
If stock certificates have been issued for shares being redeemed, they must
accompany the written request. For redemptions of $50,000 or less paid to the
shareholder at the address of record, the request must be signed by all owners
of the shares or the investment dealer of record, but a signature guarantee is
not required. When the redemption is for more than $50,000, or if payment is
made to someone else or to another address, signatures of all record owners are
required and a signature guarantee may be required. Each signature guarantee
must be supplied by an eligible guarantor institution. Each Fund reserves the
right to reject a signature guarantee supplied by an eligible institution based
on its creditworthiness. The Funds may request further documentation from
corporations, retirement plans, executors, administrators, trustees or
guardians.

In addition to redemption of Fund shares, the Distributor, acting as
agent of the Funds, offers to repurchase Fund shares from broker/dealers acting
on behalf of shareholders. The redemption or repurchase price, which may be more
or less than the shareholder's cost, is the net asset value per share next
determined after receipt of the request in good order by the respective Fund,
its agent or certain other authorized persons, subject to any applicable CDSC or
Limited CDSC. See Distribution and Service under Investment Management
Agreements. This is computed and effective at the time the offering price and
net asset value are determined. See Determining Offering Price and Net Asset
Value. The Funds and the Distributor end their business days at 5 p.m., Eastern
time. This offer is discretionary and may be completely withdrawn without
further notice by the Distributor.

Orders for the repurchase of Fund shares which are submitted to the
Distributor prior to the close of its business day will be executed at the net
asset value per share computed that day (subject to the applicable CDSC or
Limited CDSC), if the repurchase order was received by the broker/dealer from
the shareholder prior to the time the offering price and net asset value are
determined on such day. The selling dealer has the responsibility of
transmitting orders to the Distributor promptly. Such repurchase is then settled
as an ordinary transaction with the broker/dealer (who may make a charge to the
shareholder for this service) delivering the shares repurchased.

Certain redemptions of Class A Shares purchased at net asset value may
result in the imposition of a Limited CDSC. See Contingent Deferred Sales Charge
for Certain Redemptions of Class A Shares Purchased at Net Asset Value under
Redemption and Exchange in the Prospectuses for the Fund Classes. Class B Shares
are subject to a CDSC of: (i) 5% if shares are redeemed within one year of
purchase; (ii) 4% if shares are redeemed during the second year of purchase;
(iii) 3% if shares are redeemed during the third or fourth year following
purchase; (iv) 2% if shares are redeemed during the fifth year following
purchase; and (v) 1% if shares are redeemed during the sixth year following
purchase. Class C Shares are subject to a CDSC of 1% if shares are redeemed
within 12 months following purchase. See Contingent Deferred Sales Charge -
Class B Shares and Class C Shares under Classes of Shares in the Prospectuses
for the Fund Classes. Except for the applicable CDSC or Limited CDSC and, with
respect to the expedited payment by wire described below for which, in the case
of the Fund Classes, there is currently a $7.50 bank wiring cost, neither the
Funds nor the Distributor charges a fee for redemptions or repurchases, but such
fees could be charged at any time in the future.

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Payment for shares redeemed will ordinarily be mailed the next business
day, but in no case later than seven days, after receipt of a redemption request
in good order; provided, however, that each commitment to mail or wire
redemption proceeds by a certain time, as described below, is modified by the
qualifications described in the next paragraph.

Each Fund will process written or telephone redemption requests to the
extent that the purchase orders for the shares being redeemed have already been
settled. A Fund will honor the redemption requests as to shares for which a
check was tendered as payment, but a Fund will not mail or wire the proceeds
until it is reasonably satisfied that the check has cleared. This potential
delay can be avoided by making investments by wiring Federal Funds.

If a shareholder has been credited with a purchase by a check which is
subsequently returned unpaid for insufficient funds or for any other reason, the
Fund involved will automatically redeem from the shareholder's account the
shares purchased by the check plus any dividends earned thereon. Shareholders
may be responsible for any losses to a Fund or to the Distributor.

In case of a suspension of the determination of the net asset value
because the New York Stock Exchange is closed for other than weekends or
holidays, or trading thereon is restricted or an emergency exists as a result of
which disposal by a Fund of securities owned by it is not reasonably practical,
or it is not reasonably practical for a Fund fairly to value its assets, or in
the event that the SEC has provided for such suspension for the protection of
shareholders, a Fund may postpone payment or suspend the right of redemption or
repurchase. In such case, the shareholder may withdraw the request for
redemption or leave it standing as a request for redemption at the net asset
value next determined after the suspension has been terminated.

Payment for shares redeemed or repurchased may be made either in cash
or kind, or partly in cash and partly in kind. Any portfolio securities paid or
distributed in kind would be valued as described in Determining Offering Price
and Net Asset Value. Subsequent sale by an investor receiving a distribution in
kind could result in the payment of brokerage commissions. However, Global
Funds, Inc. has elected to be governed by Rule 18f-1 under the 1940 Act pursuant
to which each Fund is obligated to redeem shares solely in cash up to the lesser
of $250,000 or 1% of the net asset value of such Fund during any 90-day period
for any one shareholder.

The value of a Fund's investments is subject to changing market prices.
Thus, a shareholder reselling shares to a Fund may sustain either a gain or
loss, depending upon the price paid and the price received for such shares.

Small Accounts
Before a Fund involuntarily redeems shares from an account that, under
the circumstances listed in the relevant Prospectus, has remained below the
minimum amounts required by Global Funds, Inc.'s Prospectuses and sends the
proceeds to the shareholder, the shareholder will be notified in writing that
the value of the shares in the account is less than the minimum required and
will be allowed 60 days from the date of notice to make an additional investment
to meet the required minimum. See The Conditions of Your Purchase under How to
Buy Shares in Global Funds, Inc.'s Prospectuses. Any redemption in an inactive
account established with a minimum investment may trigger mandatory redemption.
No CDSC or Limited CDSC will apply to redemptions described in this paragraph.

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<PAGE>

The Funds generally require a minimum balance of $1,000 for accounts in
all Classes.

* * *

Each Fund has made available certain redemption privileges, as
described below. The Funds reserve the right to suspend or terminate these
expedited payment procedures upon 60 days' written notice to shareholders.

Expedited Telephone Redemptions
Shareholders of the Fund Classes or their investment dealers of record
wishing to redeem any amount of shares of $50,000 or less for which certificates
have not been issued may call the Shareholder Service Center at 800-523-1918 or,
in the case of shareholders of Institutional Classes, their Client Services
Representative at 800-828-5052 prior to the time the offering price and net
asset value are determined, as noted above, and have the proceeds mailed to them
at the address of record. Checks payable to the shareholder(s) of record will
normally be mailed the next business day, but no later than seven days, after
the receipt of the redemption request. This option is only available to
individual, joint and individual fiduciary-type accounts.

In addition, redemption proceeds of $1,000 or more can be transferred
to your predesignated bank account by wire or by check by calling the phone
numbers listed above. An authorization form must have been completed by the
shareholder and filed with the relevant Fund before the request is received.
Payment will be made by wire or check to the bank account designated on the
authorization form as follows:

1. Payment by Wire: Request that Federal Funds be wired to the bank account
designated on the authorization form. Redemption proceeds will normally be wired
on the next business day following receipt of the redemption request. There is a
$7.50 wiring fee (subject to change) charged by First Union National Bank which
will be deducted from the withdrawal proceeds each time the shareholder requests
a redemption from Class A Shares, Class B Shares and Class C Shares. If the
proceeds are wired to the shareholder's account at a bank which is not a member
of the Federal Reserve System, there could be a delay in the crediting of the
funds to the shareholder's bank account.

2. Payment by Check: Request a check be mailed to the bank account designated on
the authorization form. Redemption proceeds will normally be mailed the next
business day, but no later than seven days, from the date of the telephone
request. This procedure will take longer than the Payment by Wire option (1
above) because of the extra time necessary for the mailing and clearing of the
check after the bank receives it.

Redemption Requirements: In order to change the name of the bank and
the account number it will be necessary to send a written request to the
relevant Fund and a signature guarantee may be required. Each signature
guarantee must be supplied by an eligible guarantor institution. The Funds
reserve the right to reject a signature guarantee supplied by an eligible
institution based on its creditworthiness.

To reduce the shareholder's risk of attempted fraudulent use of the
telephone redemption procedure, payment will be made only to the bank account
designated on the authorization form.

If expedited payment under these procedures could adversely affect a
Fund, such Fund may take up to seven days to pay the shareholder.

Neither the Funds nor the Funds' Transfer Agent is responsible for any
shareholder loss incurred in acting upon written or telephone instructions for
redemption or exchange of Fund shares which are reasonably believed

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to be genuine. With respect to such telephone transactions, each Fund will
follow reasonable procedures to confirm that instructions communicated by
telephone are genuine (including verification of a form of personal
identification) as, if it does not, such Fund or the Transfer Agent may be
liable for any losses due to unauthorized or fraudulent transactions. Telephone
instructions received by shareholders of the Fund Classes are generally tape
recorded. A written confirmation will be provided for all purchase, exchange and
redemption transactions initiated by telephone.

Systematic Withdrawal Plans
Shareholders of Class A Shares, Class B Shares and Class C Shares who
own or purchase $5,000 or more of shares at the offering price, or net asset
value, as applicable, for which certificates have not been issued may establish
a Systematic Withdrawal Plan for monthly withdrawals of $25 or more, or
quarterly withdrawals of $75 or more, although the Funds do not recommend any
specific amount of withdrawal. This $5,000 minimum does not apply for a Fund's
prototype retirement plans. Shares purchased with the initial investment and
through reinvestment of cash dividends and realized securities profits
distributions will be credited to the shareholder's account and sufficient full
and fractional shares will be redeemed at the net asset value calculated on the
third business day preceding the mailing date.

Checks are dated either the 1st or the 15th of the month, as selected
by the shareholder (unless such date falls on a holiday or a weekend) and are
normally mailed within two business days. Both ordinary income dividends and
realized securities profits distributions will be automatically reinvested in
additional shares of a Class at net asset value. This plan is not recommended
for all investors and should be started only after careful consideration of its
operation and effect upon the investor's savings and investment program. To the
extent that withdrawal payments from the plan exceed any dividends and/or
realized securities profits distributions paid on shares held under the plan,
the withdrawal payments will represent a return of capital and the share balance
may in time be depleted, particularly in a declining market.

The sale of shares for withdrawal payments constitutes a taxable event
and a shareholder may incur a capital gain or loss for federal income tax
purposes. This gain or loss may be long-term or short-term depending on the
holding period for the specific shares liquidated. Premature withdrawals from
retirement plans may have adverse tax consequences.

Withdrawals under this plan made concurrently with the purchases of
additional shares of the same Fund may be disadvantageous to the shareholder.
Purchases of Class A Shares through a periodic investment program in a fund
managed by the Manager must be terminated before a Systematic Withdrawal Plan
with respect to such shares can take effect, except if the shareholder is a
participant in one of our retirement plans or is investing in Delaware
Investments funds which do not carry a sales charge. Redemptions of Class A
Shares pursuant to a Systematic Withdrawal Plan may be subject to a Limited CDSC
if the purchase was made at net asset value and a dealer's commission has been
paid on that purchase. Redemptions of Class B Shares or Class C Shares pursuant
to a Systematic Withdrawal Plan may be subject to a CDSC, unless the annual
amount selected to be withdrawn is less than 12% of the account balance on the
date that the Systematic Withdrawal Plan was established. See Waiver of
Contingent Deferred Sales Charge - Class B Shares and Class C Shares and Waiver
of Limited Contingent Deferred Sales Charge - Class A Shares under Redemption
and Exchange in the Prospectuses for the Fund Classes. Shareholders should
consult their financial advisers to determine whether a Systematic Withdrawal
Plan would be suitable for them.

An investor wishing to start a Systematic Withdrawal Plan must complete
an authorization form. If the recipient of Systematic Withdrawal Plan payments
is other than the registered shareholder, the shareholder's

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<PAGE>

signature on this authorization must be guaranteed. Each signature guarantee
must be supplied by an eligible guarantor institution. The Funds reserve the
right to reject a signature guarantee supplied by an eligible institution based
on its creditworthiness. This plan may be terminated by the shareholder or the
Transfer Agent at any time by giving written notice.

The Systematic Withdrawal Plan is not available for Institutional
Classes, or currently, any of the Fund Classes of the Funds.

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<PAGE>

DISTRIBUTIONS

The Funds each will normally declare and make payments from net
investment income on an annual basis. Payments from net realized securities
profits of each Fund, if any, will be distributed annually in the quarter
following the close of the fiscal year.

Dividend payments of $1.00 or less will be automatically reinvested,
notwithstanding a shareholder's election to receive dividends in cash. If such a
shareholder's dividends increase to greater than $1.00, the shareholder would
have to file a new election in order to begin receiving dividends in cash again.
Any check in payment of dividends or other distributions which cannot be
delivered by the United States Post Office or which remains uncashed for a
period of more than one year may be reinvested in the shareholder's account at
the then-current net asset value and the dividend option may be changed from
cash to reinvest. A Fund may deduct from a shareholder's account the costs of
the Fund's effort to locate a shareholder if a shareholder's mail is returned by
the U.S. Post Office or the Fund is otherwise unable to locate the shareholder
or verify the shareholder's mailing address. These costs may include a
percentage of the account when a search company charges a percentage fee in
exchange for their location services.

Each class of shares of a Fund will share proportionately in the
investment income and expenses of such Fund, except that, absent any applicable
fee waiver, Class A Shares, Class B Shares and Class C Shares alone will incur
distribution fees under their respective 12b-1 Plans.

Under the Taxpayer Relief Act of 1997 (the "1997 Act"), as revised by
the 1998 Act, a Fund is required to track its sales of portfolio securities and
to report its capital gain distributions to you according to the following
categories of holding periods:

"Mid-term capital gains" or "28 percent rate gain": securities sold by
the Fund after July 28, 1997 that were held more than one year but not
more than 18 months. These gains will be taxable to individual
investors at a maximum rate of 28%.

"1997 Act long-term capital gains" or "20 percent rate gain":
securities sold by the Fund between May 7, 1997 and July 28, 1997 that
were held for more than 12 months, and securities sold by the Fund
after July 28, 1997 that were held for more than 18 months. As revised
by the 1998 Act, this rate applies to securities held for more than 12
months for tax years beginning after December 31, 1997. These gains
will be taxable to individual investors at a maximum rate of 20% for
investors in the 28% or higher federal income tax brackets, and at a
maximum rate of 10% for investors in the 15% federal income tax
bracket.

"Qualified 5-year gains": For individuals in the 15% bracket, qualified
5-year gains are net gains on securities held for more than 5 years
which are sold after December 31, 2000. For individuals who are subject
to tax at higher rate brackets, qualified 5-year gains are net gains on
securities which are purchased after December 31, 2000 and are held for
more than 5 years. Taxpayers subject to tax at a higher rate brackets
may also make an election for shares held on January 1, 2001 to
recognize gain on their shares (any loss is disallowed) in order to
qualify such shares as qualified 5-year property as though purchased
after December 31, 2000. These gains will be taxable to individual
investors at a maximum rate of 18% for investors in the 28% or

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<PAGE>

higher federal income tax brackets, and at a maximum rate of 8% for
investors in the 15% federal income tax bracket when sold after the 5
year holding period.

Because of each Fund's investment policy, it is expected that either
none or only a nominal portion of a Fund's dividends will be eligible for the
dividends-received deduction for corporations. The portion of dividends paid by
a Fund that so qualifies will be designated each year in a notice mailed to the
Fund's shareholders, and cannot exceed the gross amount of dividends received by
a Fund from domestic (U.S.) corporations that would have qualified for the
dividends-received deduction in the hands of a Fund if the Fund was a regular
corporation. The availability of the dividends-received deduction is subject to
certain holding period and debt financing restrictions imposed under the Code on
the corporation claiming the deduction. Under the 1997 Act, the amount that a
Fund may designate as eligible for the dividends-received deduction will be
reduced or eliminated if the shares on which the dividends earned by the Fund
were debt-financed or held by the Fund for less than a 46-day period during a
90-day period beginning 45 days before the ex-dividend date and ending 45 days
after the ex-dividend date. Similarly, if your Fund shares are debt-financed or
held by you for less than a 46-day period during a 90-day period beginning 45
days before the ex-dividend date and ending 45 days after the ex-dividend date,
then the dividends-received deduction for Fund dividends on your shares may also
be reduced or eliminated. Even if designated as dividends eligible for the
dividends-received deduction, all dividends (including any deducted portion)
must be included in your alternative minimum taxable income calculation.

Shareholders will be notified annually by Global Funds, Inc. as to the
federal income tax status of dividends and distributions paid by their Fund.

In addition to the federal taxes described above, shareholders may or
may not be subject to various state and local taxes. Because shareholders' state
and local taxes may be different than the federal taxes described above,
shareholders should consult their own tax advisers.

See also Other Tax Requirements under Accounting and Tax Issues in this
Part B.

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<PAGE>

INVESTMENT MANAGEMENT AGREEMENTS

Delaware International Advisers Ltd. ("Delaware International" or the
"Manager"), located at Third Floor, 80 Cheapside, London, England EC2V 6EE,
furnishes investment management services to each Fund, subject to the
supervision and direction of Global Funds, Inc.'s Board of Directors. Delaware
International is affiliated with Delaware Management Company ("Delaware").

Delaware Management Company ("Delaware") and its predecessors have been
managing the funds offered by Delaware Investments since 1938. On September 30,
1998, Delaware and its affiliates within Delaware Investments, including the
Manager, were managing in the aggregate more than $40 billion in assets in the
various institutional or separately managed (approximately $23,666,360,000) and
investment company (approximately $17,194,990,000) accounts.

The Investment Management Agreements for the new Europe and Latin
America Funds are dated December 23, 1998, and are expected to be approved by
the initial shareholder on December 28, 1998. The Agreements have an initial
term of two years and may be further renewed after their initial terms only so
long as such renewal and continuance are specifically approved at least annually
by the Board of Directors or by vote of a majority of the outstanding voting
securities of the Fund to which the Agreement relates, and only if the terms of
the renewal thereof have been approved by the vote of a majority of the
directors of Global Funds, Inc. who are not parties thereto or interested
persons of any such party, cast in person at a meeting called for the purpose of
voting on such approval. The Agreements are terminable without penalty on 60
days' notice by the directors of Global Funds, Inc. or by the Manager. The
Agreements will terminate automatically in the event of their assignment.

The Manager manages each Fund's investments and for its services, each
Fund has agreed to pay the Manager an annual fee equal to 1.25% on the first
$500 million of average daily net assets; 1.20% on the next $500 million; 1.15%
on the next $1.5 billion; and 1.10% on the average daily net assets in excess of
$2.5 billion. The fees payable to Delaware International, while higher than the
advisory fees paid to other mutual funds in general, are comparable to fees paid
by other mutual funds with similar objectives and policies.

Beginning with the commencement of operations of New Europe Fund and
Latin America Fund through June 30, 1999 the Distributor has elected to
voluntarily waive 12b-1 expenses and Delaware International has voluntarily
elected to waive that portion, if any, of the annual management fees payable by
New Europe Fund and Latin America Fund and to reimburse the Fund's expenses to
the extent necessary to ensure that the Total Operating Expenses of each Fund do
not exceed 1.25%, respectively, (exclusive of applicable 12b-1 Plan expenses,
taxes, interest, brokerage commissions and extraordinary expenses) on an
annualized basis.

Except for those expenses borne by the Manager under the Investment
Management Agreements and the Distributor under the Distribution Agreements,
each Fund is responsible for all of its own expenses. Among others, these
include each Fund's proportionate share of rent and certain other administrative
expenses; the investment management fees; transfer and dividend disbursing agent
fees and costs; custodian expenses; federal and state securities registration
fees; proxy costs; and the costs of preparing prospectuses and reports sent to
shareholders.

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<PAGE>

Distribution and Service
The Distributor, Delaware Distributors, L.P., located at 1818 Market
Street, serves as the national distributor of the shares of New Europe and Latin
America Funds under separate Distribution Agreements dated December 23, 1998.
The Distributor is an affiliate of the Manager and bears all of the costs of
promotion and distribution, except for payments by each Fund on behalf of its
respective Class A Shares, Class B Shares and Class C Shares under the 12b-1
Plan for each class. The Distributor has elected voluntarily to waive payments
under the 12b-1 Plan for Class A Shares, Class B Shares and Class C Shares of
New Europe Fund and Latin America Fund during the commencement of the public
offering of the Fund through May 31, 1999.

The Transfer Agent, Delaware Service Company, Inc., another affiliate
of the Manager located at 1818 Market Street, Philadelphia, PA 19103, serves as
the shareholder servicing, dividend disbursing and transfer agent for each Fund
under an amended and restated agreement dated December 23, 1998. The Transfer
Agent provides accounting services to the Funds pursuant to the terms of a
separate Fund Accounting Agreement. The Transfer Agent is also an indirect,
wholly owned subsidiary of Delaware Management Holdings, Inc.

The Fund has authorized one or more brokers to accept on its behalf
purchase and redemption orders in addition to the Transfer Agent. Such brokers
are authorized to designate other intermediaries to accept purchase and
redemption orders on the behalf of the Funds. For purposes of pricing, the Funds
will be deemed to have received a purchase or redemption order when an
authorized broker or, if applicable, a broker's authorized designee, accepts the
order.

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<PAGE>

OFFICERS AND DIRECTORS

The business and affairs of Global Funds, Inc. are managed under the
direction of its Board of Directors.

Certain officers and directors of Global Funds, Inc. hold identical
positions in each of the other Delaware Investments funds. Because the Funds are
newly-created and are not commencing operations, no accounts hold 5% or more of
a class of shares of a Fund.

DMH Corp., Delvoy, Inc., Delaware Management Business Trust,
Delaware Management Company (a series of Delaware Management Business Trust),
Delaware Management Company, Inc., Delaware Investment Advisers (a series of
Delaware Management Business Trust), 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., Delaware Capital Management, Inc. and Retirement
Financial Services, Inc. are direct or indirect, wholly owned subsidiaries of
Delaware Management Holdings, Inc. ("DMH"). On April 3, 1995, a merger between
DMH and a wholly owned subsidiary of Lincoln National Corporation ("Lincoln
National") was completed. DMH and the Manager are now indirect, wholly owned
subsidiaries, and subject to the ultimate control, of Lincoln National. Lincoln
National, with headquarters currently located 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 Global Funds, Inc. hold identical
positions in each of the other funds offered by Delaware Investments. Directors
and principal officers of Global Funds, Inc. 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.

*Wayne A. Stork (61)
Director and/or Trustee of Global Funds, Inc. and each of the other 33
investment companies in Delaware Investments, Delaware
Management Holdings, Inc. and Delaware Capital Management,
Inc.
Chairman, President, Chief Executive Officer and Director of DMH Corp.,
Delaware Distributors, Inc. and Founders Holdings, Inc.
Chairman, President, Chief Executive Officer, Chief Investment Officer
and Director of Delaware Management Company, Inc. and Delaware
International Holdings Ltd.
Chairman, Chief Executive Officer and Director of Delaware
International Advisers Ltd.
Chairman of Delaware Distributors, L.P.
Director of Delaware Service Company, Inc. and Retirement Financial
Services, Inc.
Chief Executive Officer of Delvoy, 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 Funds' investment manager and considered an
"interested person" as defined in the 1940 Act.

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<PAGE>

*Jeffrey J. Nick (45)
President, Chief Executive Officer, Director and/or Trustee of Global
Funds, Inc. and each of the 33 other investment companies in
Delaware Investments.
President, Chief Executive Officer and Director of Delaware Management
Holdings, Inc. and Lincoln National Investment Companies, Inc.
President of Lincoln Funds Corporation.
Director of Delaware International Advisers Ltd.
From 1992 to 1996, Mr. Nick was Managing Director of Lincoln
National UK plc and from 1989 to 1992, he was Senior Vice
President responsible for corporate planning and development
for Lincoln National Corporation.

Richard G. Unruh, Jr. (59)
Executive Vice President of Global Funds, Inc. and each of the other 33
investment companies in Delaware Investments, Delaware
Management Holdings, Inc. and Delaware Capital Management,
Inc.
Executive Vice President and Director of Delaware Management Company
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.

Paul E. Suckow (51)
Executive Vice President/Chief Investment Officer, Fixed Income of
Global Funds, Inc., each of the other 33 investment companies
in the Delaware Group, Delaware Management Company and
Delaware Management Holdings, Inc.
Executive Vice President and Director of Founders Holdings, Inc.
Executive Vice President of Delaware Capital Management, Inc.
Director of Founders CBO Corporation and HYPPCO Finance Company Ltd.
Before returning to Delaware Investments in 1993, Mr. Suckow was
Executive Vice President and Director of Fixed Income for
Oppenheimer Management Corporation, New York, NY from 1985 to
1992. Prior to that, Mr. Suckow was a fixed-income portfolio
manager for Delaware Investments.

Walter P. Babich (71)
Director and/or Trustee of Global Funds, Inc. and each of the other 33
investment companies in Delaware Investments.
460 North Gulph Road, King of Prussia, PA 19406.
Board Chairman, Citadel Constructors, Inc.
From 1986 to 1988, Mr. Babich was a partner of Irwin & Leighton and
from 1988 to 1991, he was a partner of I&L Investors.

- ------------------
*Director affiliated with the Funds' investment manager and considered an
"interested person" as defined in the 1940 Act.

-55-

<PAGE>

Anthony D. Knerr (60)
Director and/or Trustee of Global Funds, Inc. and each of the other 33
investment companies in Delaware Investments.
500 Fifth Avenue, New York, NY 10110.
Founder and Managing Director, Anthony Knerr & Associates.
From 1982 to 1988, Mr. Knerr was Executive Vice President/Finance
and Treasurer of Columbia University, New York. From 1987 to
1989, he was also a lecturer in English at the University. In
addition, Mr. Knerr was Chairman of The Publishing Group,
Inc., New York, from 1988 to 1990. Mr. Knerr founded The
Publishing Group, Inc. in 1988.

Ann R. Leven (58)
Director and/or Trustee of Global Funds, Inc. and each of the other 33
investment companies 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 1992, she was Adjunct Professor of Columbia Business
School.

W. Thacher Longstreth (78)
Director and/or Trustee of Global Funds, Inc. and each of the other 33
investment companies in Delaware Investments.
City Hall, Philadelphia, PA 19107.
Philadelphia City Councilman.

Thomas F. Madison (62)
Director and/or Trustee of Global Funds, Inc. and 33 other investment
companies in the Delaware Group.
President and Chief Executive Officer, MLM Partners, Inc.
200 South Fifth Street, Suite 2100, Minneapolis, Minnesota 55402.
Mr. Madison has also been Chairman of the Board of Communications
Holdings, Inc. since 1996. From February to September 1994,
Mr. Madison served as Vice Chairman--Office of the CEO of The
Minnesota Mutual Life Insurance Company and from 1988 to 1993,
he was President of U.S. WEST Communications--Markets.

Charles E. Peck (73)
Director and/or Trustee of Global Funds, Inc. and each of the other 33
investment companies in Delaware Investments.
P.O. Box 1102, Columbia, MD 21044.
Secretary/Treasurer, Enterprise Homes, Inc.
From 1981 to 1990, Mr. Peck was Chairman and Chief Executive
Officer of The Ryland Group, Inc., Columbia, MD.

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<PAGE>

David K. Downes (58)
Executive Vice President/Chief Operating Officer/Chief Financial
Officer of Global Funds, Inc., each of the other 33 investment
companies in Delaware Investments, Delaware Management
Holdings, Inc, Founders CBO Corporation, Delaware Capital
Management, Inc. and Delaware Distributors, L.P.
Executive Vice President, Chief Operating Officer, Chief Financial
Officer and Director of Delaware Management Company, DMH
Corp., Delaware Distributors, Inc., Founders Holdings, Inc.,
Delaware International Holdings, Inc. and Delvoy, Inc.
President/Chief Executive Officer/Chief Financial Officer and Director
of Delaware Service Company, Inc.
Vice President of Lincoln Funds Corporation.
Chairman, Chief Executive Officer and Director of Retirement Financial
Services, Inc.
Chairman and Director of Delaware Management Trust Company.
Director of Delaware International Advisers Ltd.
Before joining Delaware Investments in 1992, Mr. Downes was Chief
Administrative Officer, Chief Financial Officer and Treasurer
of Equitable Capital Management Corporation, New York, from
December 1985 through August 1992, Executive Vice President
from December 1985 through March 1992, and Vice Chairman from
March 1992 through August 1992.

George M. Chamberlain, Jr. (51)
Senior Vice President, Secretary and General Counsel of Global Funds,
Inc., and each of the other 33 investment companies in
Delaware Investments.
Senior Vice President and Secretary of Delaware Distributors, L.P.
and Delaware Management Holdings, Inc.
Senior Vice President, Secretary and Director of DMH Corp., Delaware
Management Company, Delaware Distributors, Inc., Delaware
Service Company, Inc., Founders Holdings, Inc., Retirement
Financial Services, Inc., Delaware Capital Management, Inc.
and Delvoy, Inc.
Executive Vice President, Secretary and Director of Delaware Management
Trust Company.
Senior Vice President and Director of Delaware International Holdings
Ltd.
Director of Delaware International Advisers Ltd.
Secretary of Lincoln Funds Corporation.
Attorney.
During the past five years, Mr. Chamberlain has served in various
capacities at different times within the Delaware
organization.

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<PAGE>

Joseph H. Hastings (49)

Senior Vice President/Corporate Controller of the Global Funds, Inc.,
each of the other 33 investment companies in Delaware
Investments and Founders Holdings, Inc.
Senior Vice President/Corporate Controller/Treasurer of Delaware
Management Holdings, Inc., DMH Corp., Delaware Management
Company, Delaware Distributors, L.P., Delaware Distributors,
Inc., Delaware Service Company, Inc., Delaware Capital
Management, Inc. and
Delaware International Holdings Ltd.
Senior Vice President/Controller and Treasurer of Delvoy, Inc.
Chief Financial Officer/Treasurer of Retirement Financial Services,
Inc.
Executive Vice President/Chief Financial Officer/Treasurer of Delaware
Management Trust Company.
Senior Vice President/Assistant Treasurer of Founders CBO Corporation.
Treasurer of Lincoln Funds Corporation.
1818 Market Street, Philadelphia, PA 19103.
Before joining Delaware Investments 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 (36)
Senior Vice President/Treasurer of Global Funds, Inc., each of the
other 33 investment companies in Delaware Investments,
Delaware Distributors, Inc. and Founders Holdings, Inc.
Senior Vice President/Investment Accounting of Delaware Management
Company and Delaware
Service Company, Inc.
Senior Vice President and Treasurer/Manager, Investment Accounting of
Delaware Distributors, L.P.
Senior Vice President and Manager of Investment Accounting of Delaware
International Holdings Ltd.
Assistant Treasurer of Founders CBO Corporation.
Before joining Delaware Investments 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
Global Funds, Inc. and the total compensation received from all Delaware
Investments funds for the fiscal year ended November 30, 1998 and an estimate of
annual benefits to be received upon retirement under the Delaware Investments
Retirement Plan for Directors/Trustees as of November 30, 1998.

Pension or
Retirement Total
Benefits Estimated Compensation
Aggregate Accrued Annual from all 34
Compensation as Part of Benefits Delaware Investments
from Global Global Funds, Upon Investment
Name Funds, Inc. Inc. Expenses Retirement(1) Companies(2)
- ---- ------------ ------------- ------------- --------------------

<S> <C> <C> <C> <C>
W. Thacher Longstreth ............ $1,332 None $38,500 $60,423
Ann R. Leven ..................... $1,435 None $38,500 $66,585
Walter P. Babich ................. $1,418 None $38,500 $65,424
Anthony D. Knerr ................. $1,418 None $38,500 $65,424
Charles E. Peck .................. $1,332 None $38,500 $60,423
Thomas F. Madison ................ $1,375 None $38,500 $62,924
John H. Durham(3) ................ 933 None $31,000 $30,394
</TABLE>

(1) Under the terms of the Delaware Group Retirement Plan for
Directors/Trustees, each disinterested director/trustee 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 investment company in the Delaware Investments family for
which he or she serves as a director or trustee for a period equal to the
lesser of the number of years that such person served as a director or
trustee 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/trustees of each investment company at the time of such
person's retirement. If an eligible director/trustee retired as of October
31, 1998 he or she would be entitled to annual payments totaling the amount
noted above, in the aggregate, from all of the investment companies in the
Delaware Investments family for which he or she served as director or
trustee, based on the number of investment companies in the Delaware
Investments family as of that date.
(2) Each independent director/trustee (other than John H. Durham) currently
receives a total annual retainer fee of $38,500 for serving as a director or
trustee for all 34 investment companies in Delaware Investments, plus $3,145
for each Board Meeting attended. John H. Durham currently receives a total
annual retainer fee of $31,000 for serving as a director or trustee for 19
investment companies in Delaware Investments, plus $1,757.50 for each Board
Meeting attended. Ann R. Leven, Walter P. Babich, Anthony D. Knerr and
Thomas F. Madison serve on the Fund's audit committee; Ms. Leven is the
chairperson. Members of the audit committee currently receive additional
annual compensation of $5,000 from all investment companies, in the
aggregate, with the exception of the chairperson, who receives $6,000.

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<PAGE>

(3) John H. Durham joined the Board of Directors of the Global Funds, Inc. and
18 other investment companies in Delaware Investments on April 16, 1998.

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<PAGE>

EXCHANGE PRIVILEGE

The exchange privileges available for shareholders of the Fund's
classes and for shareholders of classes of other Delaware Investments funds are
set forth in the relevant prospectus for such classes. The following supplements
that information. Each Fund may modify, terminate or suspend the exchange
privilege upon 60 days' notice to shareholders.

All exchanges involve a purchase of shares of the fund into which the
exchange is made. As with any purchase, an investor should obtain and carefully
read that fund's prospectus before buying shares in an exchange. The prospectus
contains more complete information about the fund, including charges and
expenses. A shareholder requesting an exchange will be sent a current prospectus
and an authorization form for any of the other Delaware Investments mutual
funds. Exchange instructions must be signed by the record owner(s) exactly as
the shares are registered.

An exchange constitutes, for tax purposes, the sale of one fund and the
purchase of another. The sale may involve either a capital gain or loss to the
shareholder for federal income tax purposes.

In addition, investment advisers and dealers may make exchanges between
Delaware Investments funds on behalf of their clients by telephone or other
expedited means. This service may be discontinued or revised at any time by the
Transfer Agent. Such exchange requests may be rejected if it is determined that
a particular request or the total requests at any time could have an adverse
effect on any of the funds. Requests for expedited exchanges may be submitted
with a properly completed exchange authorization form, as described above.

Telephone Exchange Privilege
Shareholders owning shares for which certificates have not been issued
or their investment dealers of record may exchange shares by telephone for
shares in other mutual funds offered by Delaware Investments. This service is
automatically provided unless the relevant Fund receives written notice from the
shareholder to the contrary.

Shareholders or their investment dealers of record may contact the
Shareholder Service Center at 800-523-1918 or, in the case of shareholders of
the Institutional Classes, their Client Services Representative at 800-
828-5052, to effect an exchange. The shareholder's current Fund account number
must be identified, as well as the registration of the account, the share or
dollar amount to be exchanged and the fund into which the exchange is to be
made. Requests received on any day after the time the offering price and net
asset value are determined will be processed the following day. See Determining
Offering Price and Net Asset Value. Any new account established through the
exchange will automatically carry the same registration, shareholder information
and dividend option as the account from which the shares were exchanged. The
exchange requirements of the fund into which the exchange is being made, such as
sales charges, eligibility and investment minimums, must be met. (See the
prospectus of the fund desired or inquire by calling the Transfer Agent or, as
relevant, your Client Services Representative.) Certain funds are not available
for retirement plans.

The telephone exchange privilege is intended as a convenience to
shareholders and is not intended to be a vehicle to speculate on short-term
swings in the securities market through frequent transactions in and out of the
Delaware Investments funds. Telephone exchanges may be subject to limitations as
to amounts or frequency. The Transfer Agent and each Fund reserve the right to
record exchange instructions received by telephone and to reject exchange
requests at any time.

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As described in the Funds' Prospectuses, neither the Funds nor their
Transfer Agent is responsible for any shareholder loss incurred in acting upon
written or telephone instructions for redemption or exchange of Fund shares
which are reasonably believed to be genuine.

Right to Refuse Timing Accounts
With regard to accounts that are administered by market timing services
("Timing Firms") to purchase or redeem shares based on changing economic and
market conditions ("Timing Accounts"), each Fund will refuse any new timing
arrangements, as well as any new purchases (as opposed to exchanges) in Delaware
Investments funds from Timing Firms. A Fund reserves the right to temporarily or
permanently terminate the exchange privilege or reject any specific purchase
order for any person whose transactions seem to follow a timing pattern who: (i)
makes an exchange request out of the Fund within two weeks of an earlier
exchange request out of the Fund, or (ii) makes more than two exchanges out of
the Fund per calendar quarter, or (iii) exchanges shares equal in value to at
least $5 million, or more than 1/4 of 1% of the Fund's net assets. Accounts
under common ownership or control, including accounts administered so as to
redeem or purchase shares based upon certain predetermined market indicators,
will be aggregated for purposes of the exchange limits.

Restrictions on Timed Exchanges
Timing Accounts operating under existing timing agreements may only
execute exchanges between the following eight Delaware Investments funds: (1)
Decatur Income Fund, (2) Decatur Total Return Fund, (3) Delaware Fund, (4)
Limited-Term Government Fund, (5) USA Fund, (6) Delaware Cash Reserve, (7)
Delchester Fund and (8) Tax-Free Pennsylvania Fund. No other Delaware
Investments funds are available for timed exchanges. Assets redeemed or
exchanged out of Timing Accounts in Delaware Investments funds not listed above
may not be reinvested back into that Timing Account. Each Fund reserves the
right to apply these same restrictions to the account(s) of any person whose
transactions seem to follow a timing pattern (as described above).

Each Fund also reserves the right to refuse the purchase side of an
exchange request by any Timing Account, person, or group if, in the Manager's
judgment, the Fund would be unable to invest effectively in accordance with its
investment objectives and policies, or would otherwise potentially be adversely
affected. A shareholder's purchase exchanges may be restricted or refused if a
Fund receives or anticipates simultaneous orders affecting significant portions
of the Fund's assets. In particular, a pattern of exchanges that coincide with a
"market timing" strategy may be disruptive to a Fund and therefore may be
refused.

Except as noted above, only shareholders and their authorized brokers
of record will be permitted to make exchanges or redemptions.

* * *

Following is a summary of the investment objectives of the other
Delaware Investments funds:

Delaware Fund seeks long-term growth by a balance of capital
appreciation, income and preservation of capital. It uses a dividend-oriented
valuation strategy to select securities issued by established companies that are
believed to demonstrate potential for income and capital growth. Devon Fund
seeks current income and capital appreciation by investing primarily in
income-producing common stocks, with a focus on common stocks the Manager
believes have the potential for above average dividend increases over time.

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

Small Cap Value Fund seeks capital appreciation by investing primarily
in common stocks whose market values appear low relative to their underlying
value or future potential.

DelCap Fund seeks long-term capital growth by investing in common
stocks and securities convertible into common stocks of companies that have a
demonstrated history of growth and have the potential to support continued
growth.

Decatur Income Fund seeks the highest possible current income by
investing primarily in common stocks that provide the potential for income and
capital appreciation without undue risk to principal. Decatur Total Return Fund
seeks long-term growth by investing primarily in securities that provide the
potential for income and capital appreciation without undue risk to principal.
Blue Chip Fund seeks to achieve long-term capital appreciation. Current income
is a secondary objective. It seeks to achieve these objectives by investing
primarily in equity securities and any securities that are convertible into
equity securities. Social Awareness Fund seeks to achieve long-term capital
appreciation. It seeks to achieve this objective by investing in equity
securities of medium-to large-sized companies expected to grow over time that
meet the Fund's "Social Criteria" strategy.

Delchester Fund seeks as high a current income as possible by investing
principally in high yield, high risk corporate bonds, and also in U.S.
government securities and commercial paper. Strategic Income Fund seeks to
provide investors with high current income and total return by using a
multi-sector investment approach, investing principally in three sectors of the
fixed-income securities markets: high yield, higher risk securities, investment
grade fixed-income securities and foreign government and other foreign
fixed-income securities. High-Yield Opportunities Fund seeks to provide
investors with total return and, as a secondary objective, high current income.

U.S. Government Fund seeks high current income by investing primarily
in long-term U.S. government debt obligations issued or guaranteed by the U.S.
government, its agencies or instrumentalities.

Limited-Term Government Fund seeks high, stable income by investing
primarily in a portfolio of short- and intermediate-term securities issued or
guaranteed by the U.S. government, its agencies or instrumentalities and
instruments secured by such securities.

Delaware Cash Reserve seeks the highest level of income consistent with
the preservation of capital and liquidity through investments in short-term
money market instruments, while maintaining a stable net asset value.

REIT Fund seeks to achieve maximum long-term total return with capital
appreciation as a secondary objective. It seeks to achieve its objectives by
investing in securities of companies primarily engaged in the real estate
industry.

Tax-Free USA Fund seeks high current income exempt from federal income
tax by investing in municipal bonds of geographically-diverse issuers. Tax-Free
Insured Fund invests in these same types of securities but with an emphasis on
municipal bonds protected by insurance guaranteeing principal and interest are
paid when due. Tax-Free USA Intermediate Fund seeks a high level of current
interest income exempt from federal income tax, consistent with the preservation
of capital by investing primarily in municipal bonds.

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Tax-Free Money Fund seeks high current income, exempt from federal
income tax, by investing in short-term municipal obligations, while maintaining
a stable net asset value.

Tax-Free New Jersey Fund seeks a high level of current interest income
exempt from federal income tax and New Jersey state and local taxes, consistent
with preservation of capital. Tax-Free Ohio Fund seeks a high level of current
interest income exempt from federal income tax and Ohio state and local taxes,
consistent with preservation of capital. Tax-Free Pennsylvania Fund seeks a high
level of current interest income exempt from federal income tax and Pennsylvania
state and local taxes, consistent with the preservation of capital.

U.S. Growth Fund seeks to maximize capital appreciation by investing in
companies of all sizes which have low dividend yields, strong balance sheets and
high expected earnings growth rates relative to their industry. Overseas Equity
Fund seeks to maximize total return (capital appreciation and income),
principally through investments in an internationally diversified portfolio of
equity securities. New Pacific Fund seeks long-term capital appreciation by
investing primarily in companies which are domiciled in or have their principal
business activities in the Pacific Basin.

Delaware Group Premium Fund, Inc. offers 16 funds available exclusively
as funding vehicles for certain insurance company separate accounts. Decatur
Total Return Series seeks the highest possible total rate of return by selecting
issues that exhibit the potential for capital appreciation while providing
higher than average dividend income. Delchester Series seeks as high a current
income as possible by investing in rated and unrated corporate bonds, U.S.
government securities and commercial paper. Capital Reserves Series seeks a high
stable level of current income while minimizing fluctuations in principal by
investing in a diversified portfolio of short-and intermediate-term securities.
Cash Reserve Series seeks the highest level of income consistent with
preservation of capital and liquidity through investments in short-term money
market instruments. DelCap Series seeks long-term capital appreciation by
investing its assets in a diversified portfolio of securities exhibiting the
potential for significant growth. Delaware Series seeks a balance of capital
appreciation, income and preservation of capital. It uses a dividend-oriented
valuation strategy to select securities issued by established companies that are
believed to demonstrate potential for income and capital growth. International
Equity Series seeks long-term growth without undue risk to principal by
investing primarily in equity securities of foreign issuers that provide the
potential for capital appreciation and income. Small Cap Value Series seeks
capital appreciation by investing primarily in small-cap common stocks whose
market values appear low relative to their underlying value or future earnings
and growth potential. Emphasis will also be placed on securities of companies
that may be temporarily out of favor or whose value is not yet recognized by the
market. Trend Series seeks long-term capital appreciation by investing primarily
in small-cap common stocks and convertible securities of emerging and other
growth-oriented companies. These securities will have been judged to be
responsive to changes in the market place and to have fundamental
characteristics to support growth. Income is not an objective. Global Bond
Series seeks to achieve current income consistent with the preservation of
principal by investing primarily in global fixed-income securities that may also
provide the potential for capital appreciation. Strategic Income Series seeks
high current income and total return by using a multi-sector investment
approach, investing primarily in three sectors of the fixed-income securities
markets: high-yield, higher risk securities; investment grade fixed-income
securities; and foreign government and other foreign fixed-income securities.
Devon Series seeks current income and capital appreciation by investing
primarily in income-producing common stocks, with a focus on common stocks that
the investment manager believes have the potential for above-average dividend
increases over time. Emerging Markets Series seeks to achieve long-term capital
appreciation by investing primarily in equity securities of issuers located or
operating in emerging countries. Convertible Securities Series seeks a high
level of total return on its assets through a combination of capital
appreciation and current income by investing primarily in

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convertible securities. Social Awareness Series seeks to achieve long-term
capital appreciation by investing primarily in equity securities of medium to
large-sized companies expected to grow over time that meet the Series' "Social
Criteria" strategy. REIT Series seeks to achieve maximum long-term total return,
with capital appreciation as a secondary objective, by investing in securities
of companies primarily engaged in the real estate industry.

Delaware-Voyageur US Government Securities Fund seeks to provide a high
level of current income consistent with the prudent investment risk by investing
in U.S. Treasury bills, notes, bonds, and other obligations issued or
unconditionally guaranteed by the full faith and credit of the U.S. Treasury,
and repurchase agreements fully secured by such obligations.

Delaware-Voyageur Tax-Free Arizona Insured Fund seeks to provide a high
level of current income exempt from federal income tax and the Arizona personal
income tax, consistent with the preservation of capital. Delaware-Voyageur
Minnesota Insured Fund seeks to provide a high level of current income exempt
from federal income tax and the Minnesota personal income tax, consistent with
the preservation of capital.

Delaware-Voyageur Tax-Free Minnesota Intermediate Fund seeks to provide
a high level of current income exempt from federal income tax and the Minnesota
personal income tax, consistent with preservation of capital. The Fund seeks to
reduce market risk by maintaining an average weighted maturity from five to ten
years.

Delaware-Voyageur Tax-Free California Insured Fund seeks to provide a
high level of current income exempt from federal income tax and the California
personal income tax, consistent with the preservation of capital.
Delaware-Voyageur Tax-Free Florida Insured Fund seeks to provide a high level of
current income exempt from federal income tax, consistent with the preservation
of capital. The Fund will seek to select investments that will enable its shares
to be exempt from the Florida intangible personal property tax.
Delaware-Voyageur Tax-Free Florida Fund seeks to provide a high level of current
income exempt from federal income tax, consistent with the preservation of
capital. The Fund will seek to select investments that will enable its shares to
be exempt from the Florida intangible personal property tax. Delaware-Voyageur
Tax-Free Kansas Fund seeks to provide a high level of current income exempt from
federal income tax, the Kansas personal income tax and the Kansas Intangible
personal property tax, consistent with the preservation of capital.
Delaware-Voyageur Tax-Free Missouri Insured Fund seeks to provide a high level
of current income exempt from federal income tax and the Missouri personal
income tax, consistent with the preservation of capital. Delaware-Voyageur
Tax-Free New Mexico Fund seeks to provide a high level of current income exempt
from federal income tax and the New Mexico personal income tax, consistent with
the preservation of capital. Delaware-Voyageur Tax-Free Oregon Insured Fund
seeks to provide a high level of current income exempt from federal income tax
and the Oregon personal income tax, consistent with the preservation of capital.
Delaware-Voyageur Tax-Free Utah Fund seeks to provide a high level of current
income exempt from federal income tax, consistent with the preservation of
capital. Delaware-Voyageur Tax-Free Washington Insured Fund seeks to provide a
high level of current income exempt from federal income tax, consistent with the
preservation of capital.

Delaware-Voyageur Tax-Free Arizona Fund seeks to provide a high level
of current income exempt from federal income tax and the Arizona personal income
tax, consistent with the preservation of capital. Delaware-Voyageur Tax-Free
California Fund seeks to provide a high level of current income exempt from

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federal income tax and the California personal income tax, consistent with the
preservation of capital. Delaware-Voyageur Tax-Free Iowa Fund seeks to provide a
high level of current income exempt from federal income tax and the Iowa
personal income tax, consistent with the preservation of capital.
Delaware-Voyageur Tax-Free Idaho Fund seeks to provide a high level of current
income exempt from federal income tax and the Idaho personal income tax,
consistent with the preservation of capital. Delaware-Voyageur Minnesota High
Yield Municipal Bond Fund seeks to provide a high level of current income exempt
from federal income tax and the Minnesota personal income tax primarily through
investment in medium and lower grade municipal obligations. National High Yield
Municipal Fund seeks to provide a high level of income exempt from federal
income tax, primarily through investment in medium and lower grade municipal
obligations. Delaware-Voyageur Tax-Free New York Fund seeks to provide a high
level of current income exempt from federal income tax and the personal income
tax of the state of New York and the city of New York, consistent with the
preservation of capital. Delaware-Voyageur Tax-Free Wisconsin Fund seeks to
provide a high level of current income exempt from federal income tax and the
Wisconsin personal income tax, consistent with the preservation of capital.

Delaware-Voyageur Tax-Free Colorado Fund seeks to provide a high level
of current income exempt from federal income tax and the Colorado personal
income tax, consistent with the preservation of capital.

Aggressive Growth Fund seeks long-term capital appreciation, which the
Fund attempts to achieve by investing primarily in equity securities believed to
have the potential for high earnings growth. Although the Fund, in seeking its
objective, may receive current income from dividends and interest, income is
only an incidental consideration in the selection of the Fund's investments.
Growth Stock Fund has an objective of long-term capital appreciation. The Fund
seeks to achieve its objective from equity securities diversified among
individual companies and industries. Tax-Efficient Equity Fund seeks to obtain
for taxable investors a high total return on an after-tax basis. The Fund will
attempt to achieve this objective by seeking to provide a high long-term
after-tax total return through managing its portfolio in a manner that will
defer the realization of accrued capital gains and minimize dividend income.

Delaware-Voyageur Tax-Free Minnesota Fund seeks to provide a high level
of current income exempt from federal income tax and the Minnesota personal
income tax, consistent with the preservation of capital. Delaware-Voyageur
Tax-Free North Dakota Fund seeks to provide a high level of current income
exempt from federal income tax and the North Dakota personal income tax,
consistent with the preservation of capital.

For more complete information about any of the Delaware Investments
funds, including charges and expenses, you can obtain a prospectus from the
Distributor. Read it carefully before you invest or forward funds.

Each of the summaries above is qualified in its entirety by the
information contained in each fund's prospectus(es).

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GENERAL INFORMATION

Delaware International is the investment manager of each Fund of Global
Funds, Inc. Delaware International, or its affiliate Delaware, also manages the
other Delaware Investments funds. An affiliate of Delaware also manages private
investment accounts. While investment decisions of each Fund are made
independently from those of the other funds and accounts, investment decisions
for such other funds and accounts may be made at the same time as investment
decisions for a Fund.

Delaware International, or its affiliate, Delaware, also manages the
investment options for Delaware Medallion(SM) III Variable Annuity. Medallion is
issued by Allmerica Financial Life Insurance and Annuity Company (First
Allmerica Financial Life Insurance Company in New York and Hawaii). Delaware
Medallion offers 15 different investment series ranging from domestic equity
funds, international equity and bond funds and domestic fixed income funds. Each
investment series available through Medallion utilizes an investment strategy
and discipline the same as or similar to one of the Delaware Investments mutual
funds available outside the annuity. See Delaware Group Premium Fund, Inc.,
above.

Access persons and advisory persons of the Delaware Investments funds,
as those terms are defined in SEC Rule 17j-1 under the 1940 Act, who provide
services to Delaware, Delaware International or their affiliates, are permitted
to engage in personal securities transactions subject to the exceptions set
forth in Rule 17j-1 and the following general restrictions and procedures: (1)
certain blackout periods apply to personal securities transactions of those
persons; (2) transactions must receive advance clearance and must be completed
on the same day as the clearance is received; (3) certain persons are prohibited
from investing in initial public offerings of securities and other restrictions
apply to investments in private placements of securities; (4) opening positions
may only be closed-out at a profit after a 60-day holding period has elapsed;
and (5) the Compliance Officer must be informed periodically of all securities
transactions and duplicate copies of brokerage confirmations and account
statements must be supplied to the Compliance Officer.

The Distributor acts as national distributor for each of the Funds and
for the other Delaware Investments mutual funds.

The Transfer Agent, an affiliate of Delaware International and
Delaware, acts as shareholder servicing, dividend disbursing and transfer agent
for each Fund and for the other Delaware Investments mutual funds. The Transfer
Agent is paid a fee by each Fund for providing these services consisting of an
annual per account charge of $5.50 for each Fund plus transaction charges for
particular services according to a schedule. Compensation is fixed each year and
approved by the Board of Directors, including a majority of the unaffiliated
directors. The Transfer Agent also provides accounting services to each Fund.
Those services include performing all functions related to calculating each
Fund's net asset value and providing all financial reporting services,
regulatory compliance testing and the related accounting services. For its
services, the Transfer Agent is paid a fee based on total assets of all Delaware
Investments funds for which it provides such accounting services. Such fee is
equal to 0.25% multiplied by the total amount of assets in the complex for which
the Transfer Agent furnishes accounting services, where such aggregate complex
assets are $10 billion or less, and 0.20% of assets if such aggregate complex
assets exceed $10 billion. The fees are charged to each fund, including each
Fund, on an aggregate pro-rata basis. The asset-based fee payable to the
Transfer Agent is subject to a minimum fee calculated by determining the total
number of investment portfolios and associated classes.

Delaware and its affiliates own the name "Delaware Group." Under
certain circumstances, including the termination of Global Funds, Inc.'s
advisory relationship with Delaware International and Delaware or its

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distribution relationship with the Distributor, Delaware and its affiliates
could cause Global Funds, Inc. to delete the words "Delaware Group" from Global
Funds, Inc.'s name.

The Chase Manhattan Bank ("Chase"), 4 Chase Metrotech Center, Brooklyn,
NY 11245, is custodian of each Fund's securities and cash. As custodian for the
Fund, Chase maintains a separate account or accounts for each Fund; receives,
holds and releases portfolio securities on account of each Fund; receives and
disburses money on behalf of each Fund; and collects and receives income and
other payments and distributions on account of each Fund's portfolio securities.

Capitalization
Global Funds, Inc. has a present authorized capitalization of one
billion shares of capital stock with a $0.01 par value per share. Each Fund
currently offers four classes of shares. The Board of Directors has allocated
fifty million shares to each of the Fund's Class A Shares and Institutional
Class, and has allocated twenty-five million shares to each of the Fund's Class
B Shares and Class C Shares.

While shares of Global Funds, Inc. have equal voting rights, except as
noted below, on matters affecting the Funds, each Fund would vote separately on
any matter it is directly affected by, such as any change in its fundamental
investment policies and as otherwise prescribed by the 1940 Act. Shares of each
Fund have a priority in that Fund's assets, and in gains on and income from the
portfolio of that Fund. All shares have no preemptive rights, are fully
transferable and, when issued, are fully paid and nonassessable.

Each Class of each Fund represents a proportionate interest in the
assets of such Fund and has the same voting and other rights and preferences as
the other classes of that Fund, except that shares of a Fund's Institutional
Class may not vote on any matter affecting the Fund Classes' Plans under Rule
12b-1. Similarly, as a general matter, shareholders of Class A Shares, Class B
Shares and Class C Shares of a Fund may vote only on matters affecting the 12b-1
Plan that relates to the class of shares that they hold. However, Class B Shares
of a Fund may vote on any proposal to increase materially the fees to be paid by
a Fund under the 12b-1 Plan relating to its Class A Shares. General expenses of
a Fund will be allocated on a pro-rata basis to the respective classes according
to asset size, except that expenses of the 12b-1 Plans of each Fund's Class A
Shares, Class B Shares and Class C Shares will be allocated solely to those
Classes.

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The Registration Statements of the Funds and Classes of Global Funds,
Inc. described in this Part B became effective on the following dates:

New Europe Fund

New Europe Fund A Class December 18, 1998
New Europe Fund B Class December 18, 1998
New Europe Fund C Class December 18, 1998
New Europe Fund Institutional Class December 18, 1998

Latin America Fund

Latin America Fund A Class December 18, 1998
Latin America Fund B Class December 18, 1998
Latin America Fund C Class December 18, 1998
Latin America Fund Institutional Class December 18, 1998

Noncumulative Voting
Global Funds, Inc. shares have noncumulative voting rights which means
that the holders of more than 50% of the shares of Global Funds, Inc. 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 SEC.

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FINANCIAL STATEMENTS

Ernst & Young LLP serves as the independent auditors for Delaware Group
Global & International Funds, Inc. and, in its capacity as such, audits the
annual financial statements of the Funds. Since the Funds have recently
commenced operations, no operating history exists.

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