SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
DELAWARE GROUP DIVIDEND AND INCOME FUND, INC.
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed pursuant
to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:______________________________________
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
DELAWARE GROUP GLOBAL DIVIDEND AND INCOME FUND, INC.
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
/_/ Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:__________________________________
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
VOYAGEUR ARIZONA MUNICIPAL INCOME FUND, INC.
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
/_/ Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:______________________________________
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
VOYAGEUR COLORADO INSURED MUNICIPAL INCOME FUND, INC.
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
/_/ Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:______________________________________
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
VOYAGEUR FLORIDA INSURED MUNICIPAL INCOME FUND
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
/_/ Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:______________________________________
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND, INC.
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
/_/ Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:______________________________________
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND II, INC.
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
/_/ Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:______________________________________
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
VOYAGEUR MINNESOTA MUNICIPAL INCOME FUND III, INC.
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
/_/ Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:______________________________________
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
DELAWARE GROUP LIMITED-TERM GOVERNMENT FUNDS, INC.
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
/_/ Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:______________________________________
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
/X/ Filed by the Registrant
/_/ Filed by a Party other than the Registrant
Check the appropriate box:
/X/ Preliminary Proxy Statement
/_/ Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
/_/ Definitive Proxy Statement
/_/ Definitive Additional Materials
/_/ Soliciting Material Pursuant to Sec. 240.14a-11(c) or
Sec. 240.14a-12
VOYAGEUR INVESTMENT TRUST
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment of Filing Fee (Check the appropriate box):
/X/ No fee required.
/_/ Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
1. Title of each class of securities to which transaction applies:
2. Aggregate number of securities to which transaction applies:
3. Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
4. Proposed maximum aggregate value of transaction:
5. Total fee paid:
/_/ Fee paid previously with preliminary proxy materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
1. Amount Previously Paid:__________________________
2. Form, Schedule or Registration Statement No.:____
3. Filing Party:____________________________________
4. Date Filed:______________________________________
DELAWARE 1818 Market Street
INVESTMENTS Philadelphia, PA 19103
Combined Proxy Statement and
Notice of Joint Annual Meeting of Shareholders
to be Held on December 4, 1998
To the Shareholders of:
Closed-End Funds
Delaware Group Dividend and Income Fund, Inc.
Delaware Group Global Dividend and Income Fund, Inc.
Voyageur Arizona Municipal Income Fund, Inc.
Voyageur Colorado Insured Municipal Income Fund, Inc.
Voyageur Florida Insured Municipal Income Fund
Voyageur Minnesota Municipal Income Fund, Inc.
Voyageur Minnesota Municipal Income Fund II, Inc.
Voyageur Minnesota Municipal Income Fund III, Inc.
Open-End Funds
Delaware Group Limited-Term Government Funds, Inc.
U.S. Government Money Fund
Voyageur Investment Trust
Delaware-Voyageur Tax-Free California Insured Fund
Delaware-Voyageur Tax-Free Florida Fund
Delaware-Voyageur Tax-Free Florida Insured Fund
Delaware-Voyageur Tax-Free Kansas Fund
Delaware-Voyageur Tax-Free Missouri Insured Fund
Delaware-Voyageur Tax-Free New Mexico Fund
Delaware-Voyageur Tax-Free Oregon Insured Fund
Delaware-Voyageur Tax-Free Utah Fund
Delaware-Voyageur Tax-Free Washington Insured Fund
Notice is hereby given that a Joint Annual Meeting of Shareholders of each
closed-end and open-end registered investment company within the Delaware
Investments family listed in boldfaced type above (each a "Company") will be
held on Friday, December 4, 1998 at 10:00 a.m. at the Union League, 140 South
Broad Street, Philadelphia, Pennsylvania. Each closed-end investment company
("Closed-End Fund") and each separate fund within each open-end investment
company ("Open-End Fund"), may be referred to as a "Fund." The purpose of the
Meeting is to consider and act upon the following proposals and sub-proposals
that apply either to particular Companies or to individual Funds, and to
transact any other business that properly comes before the meeting and any
adjournments thereof.
Proposal One: To Elect a
Board of Directors or Trustees Applies to all Companies except:
for the Company.............. Delaware Group Limited-Term Government Funds,
Inc.
- U.S. Government Money Fund
Proposal Two: To Approve the
Reclassification of the Fund's
Investment Objective from Applies to all Funds except:
Fundamental to Non-Fundamental Delaware Group Limited-Term Government Funds,
Inc.
- U.S. Government Money Fund
Proposal Three: To Approve a
Change in the Fund's
Fundamental Policy Concerning Applies only to the following Funds:
Diversification of Investments Voyageur Arizona Municipal Income Fund, Inc.
Voyageur Florida Insured Municipal Income
Fund
Voyageur Minnesota Municipal Income Fund II,
Inc.
Voyageur Investment Trust
- Delaware-Voyageur Tax-Free California
Insured Fund
- Delaware-Voyageur Tax-Free Florida
Insured Fund
Proposal Four: To Approve
Standardized Fundamental Each Sub-Proposal Applies to all Funds except:
Investment Restrictions for Delaware Group Limited-Term Government Funds,
the Fund (Includes Seven Inc.
Sub-Proposals)............... - U.S. Government Money Fund
4A: Industry Concentration
4B: Borrowing and Issuing
Senior Securities
4C: Underwriting Securities
4D: Investing in Real
Estate
4E: Investing in
Commodities
4F: Making Loans
4G: To Approve the
Reclassification of all
Current Fundamental
Investment Restrictions
as Non-Fundamental
Proposal Five: To Approve new
Investment Management and
Sub-Advisory Agreements for
the Fund (Includes Two Sub-Proposal Applies to all Funds except:
Sub-Proposals) Delaware Group Limited-Term Government Funds,
5A: Investment Management Inc.
Agreement........ - U.S. Government Money Fund
Sub-Proposal Applies only to the following
Fund:
5B: Sub-Advisory Agreement Delaware Group Global Dividend and Income
Fund, Inc.
Proposal Six: To Ratify the
Selection of Ernst & Young, Applies to all Companies except:
LLP as independent auditors Delaware Group Limited-Term Government Funds,
for the Company.............. Inc.
- U.S. Government Money Fund
Proposal Seven: To Approve
the Reorganization of the
Company from a Massachusetts Applies only to the following Companies:
Business Trust into a Maryland Voyageur Florida Insured Municipal Income
Corporation.................. Fund
Voyageur Investment Trust
- Delaware-Voyageur Tax-Free California
Insured Fund
- Delaware-Voyageur Tax-Free Florida
Fund
- Delaware-Voyageur Tax-Free Florida
Insured und
- Delaware-Voyageur Tax-Free Kansas Fund
- Delaware-Voyageur Tax-Free Missouri
Insured Fund
- Delaware-Voyageur Tax-Free New Mexico
Fund
- Delaware-Voyageur Tax-Free Oregon
Insured Fund
- Delaware-Voyageur Tax-Free Utah Fund
- Delaware-Voyageur Tax-Free Washington
Insured Fund
Proposal Eight: To Approve a
Plan of Liquidation and
Dissolution for the U.S.
Government Money Fund series Applies only to the following Fund:
of Delaware Group Limited-Term Delaware Group Limited-Term Government Funds,
Government Funds, Inc........ Inc.
- U.S. Government Money Fund
Wayne A. Stork Jeffrey J. Nick
Chairman President
DELAWARE
INVESTMENTS
[October 1, 1998]
Dear Shareholder:
A Joint Annual Meeting of Shareholders of selected closed-end and
open-end funds within the Delaware Investments family of funds is being held in
Philadelphia on December 4, 1998. We ask that you take the time to review the
enclosed proxy statement and provide us with your vote on the important issues
affecting your fund.
The enclosed proxy statement describes eight separate proposals that
affect some or all of the funds. In addition to the election of directors
and ratification of the selection of the funds' auditors, the proposals include
a change in all funds' investment objectives to non-fundamental and a
change in certain funds' diversification classification. Also, new
standardized fundamental investment restrictions are proposed for all funds
and the current restrictions are proposed to be made non-fundamental. These
changes will allow the Boards of Directors to modify in the future the
objectives and non-fundamental restrictions without the delay and expense
of conducting a shareholder meeting. Also, shareholders are asked to
approve new investment management agreements for certain funds. Finally,
two funds are proposed to be reorganized into Maryland corporations and one
fund is proposed to be dissolved and liquidated. We realize that this proxy
statement will take time to review, but your vote is very important. Please
familiarize yourself with the proposals presented and sign and return your
proxy card in the enclosed postage-paid envelope today.
If we do not receive your completed proxy card(s) after several weeks,
you may be contacted by our proxy solicitor, Shareholder Communications
Corporation, who will remind you to vote your shares or will record your vote
over the phone if you choose to vote in that manner. You may also call
Shareholder Communications Corporation directly at 800-___-_____ and vote by
phone.
Thank you for taking this matter seriously and participating in this
important process.
Sincerely,
Wayne A. Stork, Chairman Jeffrey J. Nick, President
QUESTIONS AND ANSWERS ABOUT THIS PROXY STATEMENT
We encourage you to read the attached proxy statement in full; however,
the following questions and answers represent some typical concerns that
shareholders might have regarding this proxy.
Q: WHY IS DELAWARE INVESTMENTS SENDING ME THIS PROXY?
Closed-end and open-end investment companies are required to obtain
shareholders' votes for certain types of changes. As a shareholder, you have a
right to vote on major policy decisions, such as those included here.
Q: WHAT ARE THE ISSUES CONTAINED IN THIS PROXY?
There are eight different proposals represented here and they are
outlined in the Notice at the beginning of the proxy statement. Several of them
apply to all the funds and others are fund-specific.
Q: HOW WILL THE BROAD-BASED PROPOSALS AFFECT ME AS A
FUND SHAREHOLDER?
Changing each fund's fundamental investment objective to
non-fundamental allows the Board of Directors to approve changes to the
investment objective to give the investment manager greater flexibility to
respond to market, regulatory or industry changes. These reclassifications are
not intended to materially alter any fund's investment objective.
Changing the fundamental policy concerning diversification of
investments of certain state specific tax-free funds gives the investment
manager greater flexibility to select appropriate investments from a smaller
universe of available choices.
Adopting a standardized list of fundamental investment restrictions
across all funds will help provide operational efficiencies and make it easier
to monitor compliance with these restrictions. Standardized investment
restrictions will also make it easier for the funds to respond quickly to
market, regulatory or industry developments in the future should the Board
determine to change a Fund's operations.
Converting all existing investment restrictions to non-fundamental
allows the Board of Directors to analyze and approve changes to the existing
investment restrictions on a fund by fund basis to further the goal of
standardization of investment restrictions. These changes will not substantially
affect the way the funds are currently managed.
Approval of the proposed fee increases or fee decreases for open-end
funds, and fee breakpoints for all funds, will ensure management fee levels that
will enable the funds to continue to receive high quality investment management
services.
Approval of new standardized investment management agreements for each
fund will help provide operational efficiencies.
Q: HOW WILL THE REORGANIZATION OF CERTAIN FUNDS AFFECT
SHAREHOLDERS?
The reorganization of certain funds from Massachusetts business trusts
into corresponding Maryland corporations will provide both consistency across
the Delaware Investments fund family and flexibility of fund operations.
Q: HOW DO THE BOARD MEMBERS FOR MY FUND RECOMMEND THAT I
VOTE?
The Board members for all the funds recommend that you vote in favor
of, or FOR, all of the proposals on the enclosed proxy card.
Q: WHOM DO I CALL FOR MORE INFORMATION OR TO PLACE MY
VOTE?
Please call your fund or Shareholder Communications at
(800)-___________ for additional information. You can vote one of four ways:
By Mail: Use the enclosed proxy card to record
your vote for each proposal, then return the card in the
postpaid envelope provided.
or
By Fax: Complete the enclosed proxy card and
fax it to (800)-_________.
or
By Telephone: Call (800)-___________ and record
your vote by touch-tone voting.
By Internet:
DELAWARE 1818 Market Street
INVESTMENTS Philadelphia, PA 19103
PROXY STATEMENT
JOINT ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD ON DECEMBER 4, 1998
Meeting Information. The Board of Directors or Trustees (hereafter
referred to as the "Board of Directors") of each closed-end and open-end
registered investment company within the Delaware Investments family listed on
the accompanying Notice (each a "Company") is soliciting your proxy to be voted
at the Joint Annual Meeting of Shareholders to be held on Friday, December 4,
1998 at 10:00 a.m. at the Union League, 140 South Broad Street, Philadelphia,
Pennsylvania or any adjournments of the meeting (hereafter, the "Meeting").
Purpose of Meeting. The purpose of the Meeting is to consider a number
of proposals and sub-proposals that either apply to each closed-end investment
company ("Closed-End Fund') or to each individual fund within each open-end
investment company ("Open-End Fund"). Each Closed-End Fund, as well as each
individual fund within an Open-End Fund, may be referred to as a "Fund." The
Proposals and Sub-Proposals, as well as the Companies or Funds to which they
apply, are listed in the accompanying Notice.
The Board of Directors urges you to complete, sign and return the Proxy
Card (or Cards) included with this Proxy Statement, whether or not you intend to
be present at the Meeting. It is important that you return the signed Proxy
Card(s) promptly to help assure a quorum for the Meeting.
General Voting Information. The persons designated as proxies will vote
your shares as you instruct on each Proxy Card. If your signed Proxy Card is
returned without any voting instructions, your shares will be voted "FOR" each
of the nominees for election as Director and "FOR" each other Proposal
concerning your Company or Fund. The persons designated as proxies will also be
authorized to vote in their discretion on any other matters which may come
before the Meeting. If you sign and return a Proxy Card, you may still attend
the Meeting to vote your shares in person. If your shares are held of record by
a broker-dealer and you wish to vote in person at the Meeting, you should obtain
a Legal Proxy from your broker of record and present it at the Meeting. You may
also revoke your proxy at any time before the Meeting: (i) by notifying Delaware
Investments in writing; (ii) by submitting a later signed Proxy Card; or (iii)
by voting your shares in person at the Meeting.
Each shareholder may cast one vote for each full share and a partial
vote for each partial share of a Fund or Company that they own on the record
date, which is September 7, 1998 for some Funds or Companies and October 6, 1998
for others, as shown in Exhibit A to this Proxy Statement. Exhibit A also shows
the number of shares of each Fund and Company that were outstanding on the
record date. It is expected that this Proxy Statement and the accompanying Proxy
Card(s) will be mailed to shareholders of record on or about October 12, 1998.
This proxy solicitation is being made largely by mail, but may also be
made by officers or employees of the Companies or their investment managers or
affiliates, through telephone, facsimile, oral or other communications.
Shareholders may provide proxy instructions by returning their Proxy Card by
mail or fax and may also communicate proxy instructions through the internet or
through the touch-tone voting. Delaware Management Company ("DMC"), the
investment manager for the Funds, on behalf of itself and the Companies, has
engaged Shareholder Communications Corporation ("SCC") to assist in the
solicitation. The estimated cost of engaging SCC, which will be shared by DMC
and the Companies, is set forth below:
CLOSED-END FUNDS RANGE
Delaware Group Dividend and Income Fund, Inc. $ to $
Delaware Group Global Dividend and Income Fund, Inc. $ to $
Voyageur Arizona Municipal Income Fund, Inc. $ to $
Voyageur Colorado Insured Municipal Income Fund, Inc. $ to $
Voyageur Florida Insured Municipal Income Fund $ to $
Voyageur Minnesota Municipal Income Fund, Inc. $ to $
Voyageur Minnesota Municipal Income Fund II, Inc. $ to $
Voyageur Minnesota Municipal Income Fund III, Inc. $ to $
OPEN-END-FUNDS
Delaware Group Limited-Term Government Funds, Inc. $ to $
Voyageur Investment Trust $ to $
Votes Required to Approve each Proposal or Sub-Proposal. Certain
Proposals within this Proxy Statement affect all shareholders of a Company as a
whole, regardless of whether the Company is an Open-End Fund consisting of a
number of individual Funds or a Closed-End Fund with both preferred and common
stockholders. For these Proposals, which include the election of Directors, the
ratification of the selection of the independent auditors, or the reorganization
to a Maryland corporation, all shareholders of the Company vote together on the
issue. One exception is that the holders of preferred stock of the Voyageur
Closed-End Funds have the right to separately elect two Directors, as well as
the right to elect the remaining Directors together with the common stock
shareholders. The remaining Proposals or Sub-Proposals contained in this Proxy
Statement only affect particular Funds and, therefore, only shareholders of
those Funds are permitted to vote on those Proposals or Sub-Proposals. The
amount of votes of a Company or Fund that are needed to approve the different
Proposals or Sub-Proposals varies. The voting requirements are described within
each Proposal or Sub-Proposal.
Abstentions and broker non-votes will be included for purposes of
determining whether a quorum is present at the Meeting. They will be treated as
votes present at the Meeting, but will not be treated as votes cast. They
therefore would have no effect on Proposals which require a plurality or
majority of votes cast for approval, but would have the same effect as a vote
"AGAINST" on proposals requiring a majority of votes present or a majority of
outstanding voting securities for approval (these different voting standards are
explained in the various Proposals). DMC will reimburse banks, brokers or
dealers for their reasonable expenses in forwarding soliciting materials to
shareholders.
Proposal One: To Elect a Board of Directors or Trustees for the Company
This Proposal applies to all Companies except Delaware Group Limited-Term
Government Funds, Inc., and its U.S. Government Money Fund, which is
proposed to be liquidated. (See Proposal Eight).
You are being asked to vote to re-elect each
current member of the Board of Directors or Trustees (hereafter, "Board of
Directors") for your Company. The nominees are: Wayne A. Stork, Jeffrey J. Nick,
Walter P. Babich, John H. Durham, Anthony D. Knerr, Ann R. Leven, W. Thacher
Longstreth, Thomas F. Madison and Charles E. Peck. Mr. Durham is not currently a
member of the Board of Voyageur Investment Trust or any of the Voyageur
Closed-End Funds and is not a nominee for the Boards of those Companies.
If elected, these persons will serve as Directors until the next Annual
or Special Meeting of Shareholders called for the purpose of electing Directors,
and until their successors have been elected and qualify for office. It is not
expected that any nominee will withdraw or become unavailable for election, but
in such a case, the power given by you in the Proxy Card may be used to vote for
a substitute nominee or nominees as recommended by the existing Boards of
Directors.
Directors and Nominees. Presented below is information about the age,
position with the Companies, principal occupation and past business experience
of each current Director and nominee. Exhibit B lists the year in which each
individual became a Director of the Companies.
Wayne A. Stork* (61), Chairman and Director and/or Trustee of each of the 34
investment companies in the Delaware Investments family 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 Management Business Trust.;
Chairman, President, Chief Executive Officer and Chief Investment Officer of
Delaware Management Company (a series of Delaware Management Business Trust);
Chairman, Chief Executive Officer and Chief Investment Officer of Delaware
Investment Advisers (a series of Delaware Management Business Trust); Chairman,
Chief Executive Officer and Director of Delaware International Advisers Ltd.,
Delaware International Holdings Ltd. and Delaware Management Holdings, Inc.;
President and Chief Executive Officer of Delvoy, Inc.; Chairman of Delaware
Distributors, L.P.; Director of Delaware Service Company, Inc. and Retirement
Financial Services, Inc. During the past five years, Mr. Stork has served in
various executive capacities at different times within the Delaware Investments
organization.
Jeffrey J. Nick* (45), President, Chief Executive Officer and Director of each
of the 34 investment companies in the Delaware Investments family; President and
Director of Delaware Management Holdings, Inc., 1997 to present; President,
Chief Executive Officer and Director of Lincoln National Investment Companies,
Inc., 1996 to present; President of Lincoln Funds Corporation, [Date]; Director
of Delaware International Advisers Ltd., 1998 to present; Director of Vantage
Global Advisors, Inc., 1996 to present; Director of Lynch & Mayer Inc.
(investment adviser), 1997 to present; Managing Director of Lincoln National UK
plc, 1992-1996; Senior Vice President of Lincoln National Corporation
responsible for corporate planning and development, 1989-1992.
Walter P. Babich (71), Director and\or Trustee of each of the 34 investment
companies in the Delaware Investments family; Board Chairman of Citadel
Constructors, Inc. (commercial building construction), 1988 to present; Partner
of I&L Investors, 1988-1991; Partner of Irwin & Leighton Partnership (building
construction), 1986-1988.
John H. Durham (61), Director and/or Trustee of 19 investment companies in the
Delaware Investments family. Partner of Complete Care Services [dates]. Mr.
Durham served as Chairman of the Board of each investment company in the
Delaware Investments family from 1986 to 1991; President of each company from
1977 to 1990; and Chief Executive Officer of each company from 1984 to 1990.
Prior to 1992, with respect to Delaware Management Holdings, Inc., Delaware
Management Company, Delaware Distributors, Inc. and Delaware Service Company,
Inc. During the past five years, Mr. Durham has served as a director and in
various executive capacities at different times within the Delaware Investments
organization.
Anthony D. Knerr (59), Director and/or Trustee of each of the 34 investment
companies in the Delaware Investments family; Founder and Managing Director,
Anthony Knerr & Associates (strategic consulting company to major non-profit
institutions and organizations), 1991 to present; Founder and Chairman of the
Publishing Group, Inc. 1988-1990; Executive Vice President/Finance and Treasurer
of Columbia University, 1982-1988; Lecturer of English at Columbia University,
1987-1989.
Ann R. Leven (57), Director and/or Trustee of each of the 34 investment
companies in the Delaware Investments family; Treasurer, National Gallery of
Art, 1994 to present; Director of four investment companies sponsored by Acquila
Management Corporation, 1985 to February, 1998; Deputy Treasurer of the National
Gallery of Art, 1990 to 1994; Treasurer and Chief Fiscal Officer of the
Smithsonian Institution, 1984-1990; Adjunct Professor at Columbia Business
School, 1975-1992.
W. Thacher Longstreth (77), Director and/or Trustee of each of the 34 investment
companies in the Delaware Investments family; Philadelphia City Councilman, 1984
to present; Consultant, Packard Press, 1988 to present; Senior Partner, MLW,
Associates (business consulting), 1983 to present; Director, Healthcare Services
Group, 1983 to present; Director Emeritus, Tasty Baking Company, 1991 to
present; Director, MicroLeague Micromedia, Inc. (computer game publisher), 1996
to present; Director, Tasty Baking Company, 1968-1991; Vice Chairman, The
Winchell Company (financial printing), 1983-1988.
Thomas F. Madison (62), Director and/or Trustee of each of the 34 investment
companies in the Delaware Investments family; President and Chief Executive
Officer of MLM Partners, Inc., 1993 to present; Chairman of the Board of
Communications Holdings, Inc., 1996 to present; Vice Chairman--Office of the CEO
of The Minnesota Mutual Life Insurance Company, February to September, 1994;
Director of Valmont Industries (irrigation systems and steel manufacturing);
Director of Eltrax Systems, Inc. (data communications integration); Director of
Minnegasco, Span Link Communications (software); Director of ACI Telecentrics
(outbound telemarketing and telecommunications); Director of Aon Risk Services (
); Director of Digital River ( ).
Charles E. Peck (72), Director and/or Trustee of each of the 34 investment
companies in the Delaware Investments family; Secretary/Treasurer, Enterprise
Homes, Inc., 1992 to present; Chairman and Chief Executive Officer of The Ryland
Group, Inc. ( ), 1981 to 1990.
- --------------------------------
* This nominee is considered to be an "interested person" of each Company, as
that term is defined in the Investment Company Act of 1940, as amended, because
he is affiliated with the investment manager and distributor of the Companies.
Board and Committee Meetings. During their most recently completed
fiscal year, most of the Companies held seven Board Meetings. In the last fiscal
year, Voyageur Investment Trust held nine regular Board meetings as well as two
special committee meetings. All of the present Directors attended at least 75%
of the meetings.
Each Board of Directors has an Audit Committee for the purpose of
meeting, at least annually, with the Companies' independent auditors and
officers to oversee the quality of financial reporting and the internal controls
of each Company, and for such purposes as the Board of Directors may from time
to time direct. The Audit Committee of each Company consists of the following
four Directors appointed by the Board, all of whom are considered to be
independent because they are not "interested persons" as defined in the
Investment Company Act of 1940, as amended (the "1940 Act"): Ann R. Leven,
Chairperson, Walter P. Babich, Anthony D. Knerr and Thomas F. Madison. Members
of the Audit Committee serve for three years or until their successors have been
appointed and qualified. The Audit Committee members are the same for all
Companies. The Audit Committee held four meetings for each Company during the
last fiscal year.
The Board also has a Nominating Committee, which meets for the purpose
of proposing nominees to serve as Directors. Such nominees are considered by the
full Board and, when appropriate, by shareholders at annual or special meetings
of shareholders. The Nominating Committee of each Company consists of the
following three Directors appointed by the Boards, two of whom are considered to
be independent Directors: [(please advise:) [_______, ________, and _________].
This Committee met [(please confirm:) once] during the past year for the purpose
of determining the proposed list of nominees for this Meeting. The selection and
nomination of the independent Director nominees is committed to the discretion
of the present independent Directors. The Nominating Committee will consider
suggestions for Board nominations from shareholders. Shareholders who wish to
suggest candidates for nomination to the Boards of Directors at any future
annual meeting should identify the candidate and furnish a written statement of
the person's qualifications to the Nominating Committee at the principal
executive offices of the Companies.
Board Compensation. Each independent Director receives compensation
from each Company of which he/she is a member of the Board of Directors. The
interested Directors are compensated by the investment manager and do not
receive compensation from the Companies. The following table identifies the
amount each Director received from each Company during its last fiscal year.
Company Name Wayne Walter John Anthony Ann W. Thomas Jeffrey Charles
A. B. H. D. R. Thacher F. J. E.
Stork Babich Durham Knerr Leven Long- Madison Nick Peck
streth
(1) (2)
Delaware None $1,654 N/A $1,654 $1,67 $1,582 $818 None $1,486
Group
Dividend and
Income Fund,
Inc.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Delaware None $1,304 N/A $1,304 $1,31 $1,271 $635 None $1,175
Group Global
Dividend and
Income Fund,
Inc.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Voyageur None $818 N/A $818 $822 $801 $801 None $706
Arizona
Municipal
Income Fund,
Inc.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Voyageur None $911 N/A $911 $917 $884 $884 None $789
Colorado
Insured
Municipal
Income Fund,
Inc.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Voyageur None $789 N/A $789 $792 $776 $776 None $680
Florida
Insured
Municipal
Income Fund
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Voyageur None $796 N/A $796 $799 $782 $782 None $687
Minnesota
Municipal
Income Fund,
Inc.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Voyageur None $1,033 N/A $1,033 $1,04 $993 $993 None $897
Minnesota
Municipal
Income Fund
II, Inc.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Voyageur None $753 N/A $753 $755 $744 $744 None $648
Minnesota
Municipal
Income Fund
III, Inc.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Voyageur None $1,667 N/A $1,667 $1,68 $1,563 $1,589 None $1,562
Investment
Trust (3)
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Total None $68,2 $11,275 $68,24 $69,5 $63,40 $63,408 None $63,408
Compensation From All Companies in the Delaware Investments family for the 12
months ended June 30, 1998
- --------------------------------------------------------------------
(1) Mr. Durham joined the Boards of Directors of most of the Companies in the
Delaware Investments family on April 16, 1998, however, he is not a member
of the Board of Directors of any Voyageur Company.
(2) Mr. Madison served on the previous Boards of Directors of the Voyageur
Companies and joined the Boards of Directors of the Companies in the
Delaware Investments family on April 30, 1997.
(3) Amounts shown are for fiscal period January 1, 1998 through August 31,
1998.
Each independent Director (other than John H. Durham) currently
receives a total annual retainer fee of $38,500 for serving as a Director for
all 34 Companies within the Delaware Investments family, plus $3,145 for each
set of Board meetings attended (generally monthly). John H. Durham currently
receives a total annual retainer fee of $31,000 for serving as a Director for 19
Companies within the Delaware Investments family, plus $1,757.50 for each set of
Board meetings attended. Members of the Audit Committee currently receive
additional annual compensation of $5,000 from all Companies, in the aggregate,
with the exception of the chairperson, who receives $6,000.
Under the terms of each Company's retirement plan for Directors, each
independent Director who, at the time of his or her retirement from the Board,
has attained the age of 70 and served on the Board for at least five continuous
years, is entitled to receive payments from the Company for a period of time
equal to the lesser of the number of years that such person served as a Director
or the remainder of such person's life. The annual amount of such payments will
be equal to the amount of the annual retainer that is paid to Directors of the
Company at the time of such person's retirement. If an eligible Director of each
Company within the Delaware Investments family retired as of June 30, 1998, he
or she would be entitled to annual payments of the amount of the annual retainer
fee noted in the previous paragraph.
Officers. Each Board of Directors and the senior management of the
Companies appoint officers each year, and from time to time as necessary. The
following individuals are executive officers of one or more of the Companies:
Wayne A. Stork, Jeffrey J. Nick, David K. Downes, Richard G. Unruh, Paul E.
Suckow, Richard J. Flannery, Michael P. Bishof, George M. Chamberlain, Jr.,
Joseph H. Hastings, Patrick P. Coyne, Mitchell L. Conery, Elizabeth H.
Howell, Paul A. Matlack, Andrew M. McCullagh, Gary A. Reed and Babak Zenouzi.
Exhibit C includes biographical information and the past business experience
of such officers, except for Mr. Stork and Mr. Nick, whose information is
set forth above along with the other Directors and nominees. The Exhibit
also identifies which officers are also officers of DMC or DIAL. The
above officers, with the exception of [(please provide names:) _____________],
own shares of common stock and/or options to purchase shares of common stock
of Lincoln National Corporation ("LNC"), the ultimate parent of DMC and DIAL.
As a result, they are considered to be "interested persons" of the Funds
under the 1940 Act. Such shares of common stock owned by the above-named
officers amount in the aggregate to no less than [ ] % of the issued and
outstanding shares of LNC. When combined with the shares that the above-named
officers would receive if they were to exercise their options, the shares
of LNC common stock owned by such persons would amount in the aggregate to
less than [ %] of the issued and outstanding common stock of LNC.
Management's Ownership of the Funds Attached to this Proxy Statement as
Exhibit D is a list of the Directors' and nominees' shareholdings of the various
Funds within the Delaware Investments family on an individual basis. Exhibit A
lists the aggregate holdings by all of the Directors and executive officers as a
group.
Required Vote. Each Director of a Company shall be elected by a
plurality of votes cast by shareholders of the Company, regardless of individual
Funds within a Company. This means that the nominees receiving the largest
number of votes will be elected to fill the available Board positions. Two
Directors of each of the Voyageur Closed-End Funds will be elected by a
plurality of the votes cast by the holders of the preferred stock of such
Closed-End Funds. The remaining Directors of each Voyageur Closed-End Fund will
be elected by a plurality of the votes cast by the holders of the common and
preferred stock of each Closed-End Fund voting together.
The Board of Directors of each Company unanimously recommends that you vote FOR
each of the proposed nominees for your Company.
Proposal Two: To Approve the Reclassification of the Fund's Investment Objective
from Fundamental to Non-fundamental
This Proposal applies to all Funds except the U.S. Government Money Fund series
of Delaware Group Limited-Term Government Funds, Inc., which is proposed to be
liquidated (see Proposal Eight).
The investment objective of each Fund, like many of the older Delaware
Investments Funds, is classified as "fundamental," which means that any changes
require shareholder approval. Under the 1940 Act, a Fund's investment objective
is not required to be fundamental. However, many investment companies have
elected to classify their investment objectives as fundamental. This practice
arose largely as a result of comments provided by state securities regulators in
their review of Fund registration statements during the state registration
process, as well as because of historical drafting conventions.
In light of the National Securities Markets Improvement Act of 1996,
which eliminated state securities administrative review of investment company
registration statements, and in order to provide the Boards of Directors with
enhanced flexibility to respond to market, industry or regulatory changes, the
Boards have approved the reclassification from fundamental to non-fundamental of
each Fund's investment objective. A non-fundamental investment objective may be
changed at any time by the Directors without the delay and expense of soliciting
proxies and holding a shareholder meeting.
For a complete description of the investment objective of your Fund,
please consult your Fund's prospectus. The reclassification from fundamental to
non-fundamental will not alter any Fund's current investment objective. If this
Proposal is approved, however, Fund management intends to request that the
Directors consider a number of modifications to the language used to define
certain Funds' investment objectives. The requested modifications are designed
to modernize and standardize the expression of such investment objectives, but
if the modifications are implemented, neither the principal investment design,
nor the day-to-day management of the Funds would be materially altered. If at
any time in the future, the Directors approve a change in a Fund's
non-fundamental investment objective, either in connection with the currently
anticipated modernization and standardization or otherwise, shareholders will be
given notice of the change prior to its implementation.
Required Vote. Approval of this proposal for a Fund requires the vote
of a "majority of the outstanding voting securities" of the Fund, which means
the vote of: (i) more than 50% of the outstanding voting securities of the Fund;
or (ii) 67% or more of the voting securities of the Fund present at a meeting,
if the holders of more than 50% of the outstanding voting securities are present
or represented by proxy, whichever is less. If the reclassification of any
Fund's investment objective from fundamental to non-fundamental is not approved
by shareholders of a particular Fund, that Fund's investment objective will
remain fundamental and shareholder approval (and its attendant costs and delays)
will continue to be required prior to any change in investment objective.
At meetings of the Directors held in September, 1998, the Directors for
such Funds considered the enhanced management flexibility to respond to market,
industry or regulatory changes that would accrue to the Board of Directors if
each relevant Fund's fundamental investment objective was reclassified as
non-fundamental and unanimously approved the proposed change.
The Board of Directors unanimously recommends that you vote FOR the
reclassification of the investment objective of your Fund as non-fundamental.
Proposal Three: To Approve a Change in the Fund's Fundamental Policy Concerning
Diversification of Investments
This Proposal applies to the following Funds:
Voyageur Investment Trust
- Delaware-Voyageur Tax-Free California Insured Fund
- Delaware-Voyageur Tax-Free Florida Insured Fund
Voyageur Arizona Municipal Income Fund, Inc.
Voyageur Florida Insured Municipal Income Fund
Voyageur Minnesota Municipal Income Fund II, Inc.
Mutual funds generally diversify their investments among many different
securities. They are, however, free to choose the extent to which they will
diversify their investments, provided they meet certain minimum limits set forth
in the 1940 Act and/or the Internal Revenue Code of 1986, as amended (the
"Code"). In order to be diversified under the 1940 Act, a Fund may not invest
more than 5% of its total assets in a single issuer (except U.S. Government
securities), or purchase more than 10% of the outstanding securities of a single
issuer. This limit only applies to 75% of the Fund's total assets, which means
that any Fund which is diversified under the 1940 Act may invest up to 25% of
its assets in a single security. If a Fund elects to be "non-diversified" under
the 1940 Act, it must still operate within the diversification requirements of
the Code, which are similar to the 1940 Act diversification requirements, but
apply only to 50% of a Fund's assets, rather than 75%. As to the remaining 50%
of Fund assets, a Fund may buy as few as two separate securities, each
representing 25% of the value of the Fund.
The Funds listed above currently are classified and operate as
"diversified" Funds, as that term is defined in the 1940 Act. Management has
recommended to the Directors that the Funds change their classification to
"non-diversified," which means that they will operate within the more flexible
diversification restrictions contained in the Code.
Each of the above Funds seeks to achieve its objective through
investment in fixed income securities, the interest on which is exempt from
federal income taxation and income taxation in the relevant state ("municipal
securities"). Funds with this investment profile are often referred to as
"state-specific tax-free funds." Many state-specific tax-free funds operate as
non-diversified funds for 1940 Act purposes because the universe of available
investments for such funds is relatively small. These funds, however, continue
to meet the diversification requirements of the Code.
Management of each Fund listed above has recommended to the Directors
that those Funds change their diversification policies from diversified to
non-diversified. This change requires shareholder approval under the 1940 Act.
In approving the proposed change and concluding that it would recommend such a
change to the Funds' respective shareholders, the Directors considered: (i) the
relatively small market for municipal securities; (ii) the fact that many
state-specific tax-free funds, including most of the other Delaware-Voyageur
state-specific tax-free Funds, operate as non-diversified funds under the 1940
Act; and (iii) the previous experience of the Funds' investment manager in
managing the Funds and the relative difficulty it experienced in locating
attractive investments. At their September, 1998 Board meetings, the Directors
unanimously approved the proposed change.
The Funds express their diversification policy in one of two ways. The
first two Funds listed above, which are Open-End Funds, simply state in their
prospectuses that they will operate as diversified Funds. The last three Funds,
each of which is a Closed-End Fund, have fundamental investment restrictions
recited in their original prospectus repeating the 1940 Act diversification
rule. In the event that shareholders approve the proposed change, it would be
implemented in one of two ways. Each of the two Open-End Funds would amend its
current prospectus disclosure describing its diversification policy. Each of the
three Closed-End Funds would eliminate the fundamental restriction, as it
appeared in its original prospectus, amend its constituent documents and take
such other action as is required by the 1940 Act to effect such change. Any
future change from non-diversified to diversified status by a Fund would not
require shareholder approval under the 1940 Act. If the proposed change is not
approved, the Funds will continue to operate within the 1940 Act limitations.
Required Vote. Approval of this proposal for a Fund requires the vote
of a "majority of the outstanding voting securities" of the Fund, which means
the vote of: (i) more than 50% of the outstanding voting securities of the Fund;
or (ii) 67% or more of the voting securities of the Fund present at a meeting,
if the holders of more than 50% of the outstanding voting securities are present
or represented by proxy, whichever is less.
The Board of Directors unanimously recommends that you vote FOR the change in
diversification policy.
Proposal Four: To Approve Standardized Fundamental Investment Restrictions for
the Fund (This Proposal involves separate votes on Sub-Proposals 4A through 4G)
This Proposal applies to all Funds except the U.S. Government Money Fund series
of Delaware Group Limited-Term Government Funds, Inc., which is proposed to be
liquidated (see Proposal Eight).
Proposal Overview
Each Fund is subject to investment restrictions which establish
percentage and other limits that govern the investment activities of the Fund's
investment manager or sub-adviser. Under the 1940 Act, investment restrictions
relating to certain activities are required to be "fundamental," which means
that any changes require shareholder approval. Funds are permitted to deem other
restrictions fundamental, and they may also adopt "non-fundamental"
restrictions, which can be changed by the Board of Directors without shareholder
approval. Of course, any change in a Fund's investment restrictions, whether
fundamental or not, would be approved by the Board and reflected in the Fund's
prospectus or other offering documents.
Unlike investment objectives and policies, which are often different
for each Fund, investment restrictions for Funds tend to be the same or similar,
because they are based on legal and regulatory requirements, or positions of the
staff of the SEC that apply to all Funds. Over the years, however, as new Funds
were created or added to the Delaware Investments family, investment
restrictions relating to the same activities were expressed in a variety of
different ways. Many of the differences reflect changes in regulatory
requirements over time. Many older Funds are subject to investment restrictions
that were adopted in response to regulatory, business or industry conditions
that no longer exist. In addition, a number of Funds adopted fundamental
restrictions in response to state laws and regulations that no longer apply
because they were preempted by the National Securities Markets Improvement Act
of 1996. As a result, a number of fundamental restrictions are no longer
required to be fundamental, and some previously required restrictions are no
longer required at all.
The Directors, together with Fund management and the investment
managers and sub-advisers, have analyzed the current fundamental investment
restrictions of each Fund, and have concluded that six new standardized
fundamental investment restrictions should be adopted for each Fund. The
proposed investment restrictions relate only to activities that are required
under the 1940 Act to be the subject of fundamental policies and restrictions.
The proposed investment restrictions are designed to reflect all current
regulatory requirements and are written in a way that provides flexibility to
respond to future legal, regulatory or market changes. Each Fund currently has
fundamental investment restrictions that govern the same activities covered by
the proposed fundamental investment restrictions, and a number of Funds
currently have other fundamental investment restrictions governing additional
activities. Management is recommending that all current fundamental investment
restrictions of each Fund be re-classified as non-fundamental, at the same time
that the six new standardized fundamental investment restrictions are adopted
for each Fund. If the current fundamental restrictions are made non-fundamental,
the Directors would be able to modify or eliminate the current restrictions
without the costs or delays associated with a shareholder vote.
The proposed changes will not affect any Fund's investment objective
and will not change the way any Fund is currently being managed or operated,
since all current investment restrictions will remain in place as
non-fundamental restrictions. If, as proposed, the current fundamental
investment restrictions are reclassified as non-fundamental, management intends
to recommend that the Board approve certain modifications designed to result in
a more modern and standardized list of investment restrictions for the various
Delaware Investments Funds. The recommendations by management will likely
involve the modification or elimination of restrictions concerning activities
that are covered by the six new proposed fundamental investment restrictions.
The Board of Directors will determine separately for each Fund whether
elimination or modification of a common investment restriction is appropriate
for that Fund.
Management believes that a modern, standardized list of restrictions
will enhance the ability of the Funds to achieve their objectives, because the
Funds will have greater investment management flexibility to respond to changes
in market, industry or regulatory conditions. In addition, standardized
restrictions are expected to enable the Funds to operate more efficiently and to
more easily monitor compliance with investment restrictions.
The six new proposed fundamental investment restrictions are described
below within the relevant Sub-Proposals. In addition, Exhibit E contains a list
of the current fundamental investment restrictions for each Fund which are
proposed to be reclassified as non-fundamental. Each of the Sub-Proposals is
mutually contingent with respect to each Fund. That is, unless all of the
Sub-Proposals are approved by shareholders of a Fund, none of the Sub-Proposals
will be adopted for that Fund.
Required Vote. Approval of each Sub-Proposal for a Fund requires the
vote of a "majority of the outstanding voting securities" of the Fund, which
means the vote of: (i) more than 50% of the outstanding voting securities of the
Fund; or (ii) 67% or more of the voting securities of the Fund present at a
meeting, if the holders of more than 50% of the outstanding voting securities
are present or represented by proxy, whichever is less.
The Directors have voted to adopt each of the proposed standardized
fundamental investment restrictions for the Funds, as well as to approve the
reclassification of the existing fundamental investment restrictions as
non-fundamental, and unanimously recommend that you vote FOR each Sub-Proposal
4A through 4G for your Fund.
Sub-Proposal 4A: To adopt a new fundamental investment restriction concerning
the concentration of a Fund's investments in the same industry.
Under the 1940 Act, a Fund's policy of concentrating its investments in
securities of companies in the same industry must be fundamental. A mutual fund
concentrates its investments, for purposes of the SEC, if it invests more than
25% of its "net" assets (exclusive of cash, U.S. Government securities and
tax-exempt securities) in a particular industry or group of industries. Having
the concentration policy apply to "net" assets represents a recent change by the
SEC staff from its previous concentration standard which applied to 25% of a
Fund's "total" assets. The change would slightly reduce a Fund's ability to
concentrate, since the "net" assets figure is lower than "total" assets of a
Fund because liabilities are subtracted from "total" assets.
Most Funds currently have a fundamental investment restriction
prohibiting them from concentrating their investments in the same industry.
There are, however, numerous variations in the way that the investment
restriction is described in the Funds' offering documents. In addition, most
restrictions define concentration in terms of a percentage of "total assets,"
rather than in accordance with the new "net assets," standard.
The Board recommends that you approve the standardized fundamental
investment restriction set forth below. In approving the proposed investment
restriction and concluding that it would recommend the investment restriction to
Fund shareholders, the Directors considered that the proposed investment
restriction will standardize the concentration restriction for the Funds and is
intended to provide flexibility for Funds to respond to changes in the SEC
staff's position on concentration of investments or to other relevant legal,
regulatory or market developments without the delay or expense of a shareholder
vote.
Adoption of the proposed fundamental restriction will not materially
affect the way the Funds are currently managed or operated because the existing
concentration restrictions will remain in place as non-fundamental policies
unless and until the Board of Directors modifies them in the future.
Proposed Concentration Restriction: The Fund will not make investments
that will result in the concentration (as that term may be defined in the 1940
Act, any rule or order thereunder, or 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 tax-exempt securities or certificates of deposit.
The Board has also approved a related non-fundamental policy for the
Funds, which will be adopted if the new fundamental restriction is approved and
which provides that, in applying the concentration restriction: (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. This non-fundamental policy is intended to keep the
concentration restriction from unnecessarily limiting a Fund's investments.
Sub-Proposal 4B: To adopt a new fundamental investment restriction concerning
borrowing money and issuing senior securities.
The 1940 Act imposes certain limits on investment companies with
respect to borrowing money or issuing senior securities. The limits on issuing
senior securities are different for Closed-End Funds and Open-End Funds. In
general, the limitations are designed to protect shareholders and their
investments by restricting a Fund's ability to subject its assets to any claims
of creditors or senior security holders who would be entitled to dividends or
rights on liquidation of the Fund prior to the rights of shareholders. Under the
1940 Act, a Fund's investment restrictions relating to borrowing and senior
securities must be fundamental.
The current investment restrictions concerning borrowing and senior
securities vary considerably from Fund to Fund. Shareholders of each Open-End
and Closed-End Fund are being asked to approve a new standardized fundamental
restriction that covers both borrowing and senior securities and which is
designed to reflect all current regulatory requirements. The standardized
restriction is written in a manner that is appropriate for both Open-End and
Closed-End Funds. The proposed restriction would not prevent Funds from
borrowing or issuing senior securities within the limits established under the
1940 Act or under any SEC rule, regulation or staff interpretation thereof.
Senior Securities - Generally. A "senior security" is defined as an
obligation of a Fund with respect to its earnings or assets that takes
precedence over the claims of the Fund's shareholders with respect to the same
earnings or assets. The 1940 Act generally prohibits Open-End Funds from, and
restricts Closed-End Funds with respect to, issuing senior securities, in order
to limit the ability of investment companies to use leveraging. In general, a
Fund uses leveraging when it enters into securities transactions without being
required to make payment until a later point in time.
Under the 1940 Act, a Closed-End Fund may issue debt instruments or
preferred stock as long as certain asset coverage requirements are met. In
addition, SEC staff interpretations allow both Closed-End and Open-End Funds to
engage in a number of types of transactions which might be considered to raise
"senior securities" or "leveraging" concerns, so long as the Funds meet certain
collateral requirements set by the SEC staff which are designed to protect
shareholders. For example, some of the transactions that may raise senior
security concerns include short sales, certain options and futures transactions,
reverse repurchase agreements and securities transactions that obligate the Fund
to pay money at a future date (such as when-issued, forward commitment or
delayed delivery transactions). Funds that engage in such transactions must set
aside money or securities to meet the SEC staff's collateralization
requirements.
Closed-End Funds. Under the 1940 Act, generally a Closed-End Fund is
permitted to issue a class of senior securities in the form of debt instruments
if: (1) at the time of issuance the Fund has asset coverage of at least 300%;
(2) no dividends or distributions reduce the asset coverage below 300% (200% if
the dividends are declared on preferred stock); and (3) in the event the asset
coverage remains below 100% (a) for a certain period, the holders of the senior
securities elect a majority of the Fund's directors, and (b) for a longer period
of time, the company is deemed to be in default on the securities. The Fund may
issue the senior securities in the form of preferred stock, if: (1) at the time
of issuance the Fund has an asset coverage of at least 200%; (2) no dividends or
distributions on, or repurchases of, the Fund's common stock reduce the asset
coverage below 200%; (3) the preferred stock holders elect at least two
directors, or a majority of the directors if dividends for two years are not
paid; (4) the preferred stockholders have the right to vote on any
reorganization adversely affecting them or on certain fundamental investment
restrictions; and (5) the preferred stock has complete priority over any other
class of stock as to the distribution of assets and payment of dividends, which
are to be cumulative dividends. Certain other restrictions apply, including that
only one class of senior securities in the form of debt, and only one class of
senior securities in the form of stock, may be issued, with exclusions for loans
from banks that are privately arranged for the Fund.
The investment restrictions of the two Delaware Closed-End Funds
generally follow the 1940 Act limits described above. Any such Fund may not
issue: (1) senior securities other than preferred stock, that is not in excess
of 50% of its total assets over any senior securities described in clause (2)
below that are outstanding, (2) senior securities other than preferred stock
(including borrowing money) not in excess of 33 1/3% of its total assets, and
(3) borrowings up to 5% of its total assets for temporary or defensive purposes
without regard to the amount of senior securities outstanding under clauses (a)
and (b) above. Also, the Fund's obligations under when-issued and delayed
delivery transactions and similar transactions, futures contracts and options on
futures contracts, forward contracts and options on currencies, indices and
securities are not treated as senior securities if covering assets are
appropriately segregated.
The six Closed-End Funds originally formed as part of the Voyageur fund
family generally may not issue senior securities, other than preferred stock,
except to the extent such issuance might be involved with respect to the
following borrowings: The Fund may not borrow money, except from banks for
temporary or emergency purposes or for repurchase of its shares, and then only
in an amount not exceeding one-third of the value of the Fund's total assets,
including the amount borrowed and, while any such borrowings exceed 5% of the
Fund's total assets, no purchases of investment securities will be made. Also,
the Fund's collateral arrangements with respect to options, futures contracts
and options on futures contracts and collateral requirements with respect to
initial and variation margin, and the Fund's obligations under interest rate
swaps, caps and floors, when-issued and forward commitment transactions and
similar transactions are not considered by the Fund's Board of Directors to be
the issuance of a senior security if covering assets are appropriately
segregated.
Open-End Funds. Under the 1940 Act, an Open-End Fund is permitted to
borrow up to 5% of its total assets for temporary purposes and may also borrow
from banks, provided that if borrowings exceed 5%, the Fund must have assets
totaling at least 300% of the borrowing when the amount of the borrowing is
added to the Fund's other assets. The effect of this provision is to allow an
Open-End Fund to borrow from banks amounts up to one-third (331/3%) of its total
assets (including the amount borrowed). Open-end funds typically borrow money to
meet redemptions to avoid being forced to sell portfolio securities before they
would have otherwise been sold. This technique allows the Open-End Funds greater
flexibility to buy and sell portfolio securities for investment or tax
considerations, rather than for cash flow considerations.
The investment restrictions of the Open-End Funds formed within the
Delaware Investments family in recent years generally permit borrowing to the
extent allowed under the 1940 Act, or under any SEC rule, regulation or staff
interpretation thereof, while many of the older Open-End Funds substantially
limit borrowing to 20%, 10% or even 5% of assets, rather than the 33 1/3%
permitted by law. Furthermore, a number of Open-End Funds only permit borrowing
"as a temporary measure for extraordinary purposes," while others prohibit
borrowing for leveraging purposes, or prohibit the purchase of any new
securities while borrowings are outstanding. The proposed investment restriction
would provide greater flexibility for some Open-End Funds to engage in
borrowing. The costs of borrowing can reduce a Fund's total return.
The investment restrictions of the Open-End Funds formed by Delaware
Investments in recent years specifically permit the Funds to engage in
transactions that might otherwise raise senior security concerns, consistent
with SEC staff positions. Many of the older Open-End Funds, however, have
fundamental restrictions that substantially prohibit the Funds from issuing
senior securities and, therefore, preclude the Funds from participating in many
of the types of activities that an investment manager and a Fund's Board may
deem appropriate. Since the proposed investment restriction would provide
greater flexibility for some Funds to engage in senior security transactions, if
the greater flexibility were exercised, such Funds could experience increased
risks due to the effects of leveraging. The SEC staff's collateralization
requirements are designed to address such risks.
The Board recommends that shareholders approve the fundamental
investment restriction set forth below for each Fund. The proposed investment
restriction will establish a standardized borrowing and senior securities
restriction which is appropriate for both Closed-End and Open-End Funds and
which is written to provide flexibility for Funds to respond to changes in
legal, regulatory or market developments. Adoption of the new restriction,
however, will not affect the way such Funds are currently managed or operated
because the existing restrictions will remain as non-fundamental policies unless
and until the Board of Directors modifies them in the future.
Proposed Borrowing and Securities Restriction: The Fund may not borrow
money or issue senior securities, except as the 1940 Act, any rule or order
thereunder, or SEC staff interpretation thereof, may permit.
Sub-Proposal 4C: To amend the fundamental restriction concerning underwriting.
Each Fund is currently subject to a fundamental investment restriction
prohibiting it from acting as an underwriter of the securities of other issuers.
Under the 1940 Act, a Fund's policy or restriction relating to underwriting is
required to be fundamental. A person or company is considered an underwriter
under the federal securities laws generally if it participates in the public
distribution of securities of other issuers, usually by purchasing the
securities from the issuer and re-selling the securities to the public.
Underwriters are subject to stringent regulatory requirements and often are
exposed to substantial liability. Thus, virtually all mutual funds operate in a
manner that allows them to avoid acting as underwriters.
From time to time, a mutual fund may purchase a security for investment
purposes which it later sells or re-distributes to institutional investors or
others under circumstances where the Fund could possibly be considered to be an
underwriter under the technical definition of underwriter contained in the
securities laws. The current underwriting restriction for most Funds
specifically permits such re-sales. Management, consistent with SEC staff
interpretations, believes that the Funds would not be considered to be
underwriters in these circumstances.
The Board recommends that shareholders of the Funds approve the
standardized fundamental investment restriction regarding underwriting set forth
below. The proposed restriction is substantially similar to the current
restriction for most Funds. The new restriction is proposed for each Fund
because it will help to achieve the goal of standardization of the language of
the investment restrictions among all Funds. Adoption of the proposed
restriction will not affect the way the Funds are currently managed or operated.
Proposed Underwriting Restriction: The Fund may not 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.
Sub-Proposal 4D: To approve a new fundamental restriction concerning investments
in real estate.
Each Fund currently has a fundamental investment restriction
prohibiting the purchase or sale of real estate. Most Funds' restrictions allow
the Funds to invest in companies that deal in real estate, or to invest in
securities that are secured by real estate. Under the 1940 Act, a Fund's policy
or restrictions regarding investment in real estate must be fundamental.
The Board recommends that shareholders of each Fund approve the
fundamental investment restriction concerning real estate set forth below. The
proposed investment restriction is designed to standardize the language of the
real estate restriction among the various Funds. The proposed investment
restriction will permit Funds to purchase securities whose payments of interest
or principal are secured by mortgages or other rights to real estate in the
event of default. The investment restriction will also enable the Funds to
invest in companies within the real estate industry, provided such investments
are consistent with the Fund's investment objectives and policies. Adoption of
the proposed restriction will not affect the way the Funds are managed or
operated because the current restrictions will remain as non-fundamental
policies unless and until the Board of Directors modifies them in the future.
Proposed Real Estate Restriction: The Fund may not 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.
Sub-Proposal 4E: To amend the fundamental restriction concerning investments in
commodities.
The Funds currently are subject to fundamental restrictions prohibiting
the purchase or sale of commodities or commodity contracts. Under the 1940 Act,
policies and restrictions regarding commodities must be made fundamental. The
most common types of commodities are physical commodities such as wheat, cotton,
rice and corn. However, under federal law, futures contracts are considered to
be commodities and, therefore, financial futures contracts, such as futures
contracts related to currencies, stock indices or interest rates are considered
to be commodities. Financial futures contracts enable a Fund to buy (or sell)
the right to receive the cash difference between the contract price for an
underlying asset or index and the future market price, if the market price is
higher. If the future price is lower, the Fund is obligated to pay (or, if the
Fund sold the contract, the Fund receives) the amount of the decrease. Funds
often desire to invest in financial futures contracts and options related to
such contracts for hedging or other investment reasons.
The Board recommends that shareholders approve the fundamental
investment restriction concerning commodities set forth below for each Fund. The
proposed restriction would standardize the language of the restriction among the
various Funds and provide appropriate flexibility for all Funds to invest in
financial futures contracts and related options. As proposed, the restriction is
broad enough to permit investment in financial futures instruments for either
investment or hedging purposes, which is broader than many Funds' current
restrictions. Using financial futures instruments can involve substantial risks,
and would be utilized only if the investment manager determined that such
investments are advisable and such practices were affirmatively authorized by
the Board. Adoption of the restriction will not affect the way the Funds are
currently managed or operated, because the existing commodities restrictions
will remain as non-fundamental policies unless and until the Board of Directors
modifies them in the future.
Proposed Commodities Restriction: The Fund may not 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.
Sub-Proposal 4F: To amend the fundamental restriction concerning lending by the
Funds.
Each Fund is currently subject to a fundamental investment restriction
limiting its ability to make loans. In order to ensure that the Funds may invest
in certain debt securities or repurchase agreements, which could potentially be
characterized as the making of loans, most current fundamental restrictions
specifically permit such investments. In addition, a number of Funds'
fundamental restrictions explicitly permit Funds to lend their portfolio
securities to broker-dealers or institutional investors. Securities lending is a
practice that has become common in the mutual fund industry and involves the
temporary loan of portfolio securities to parties who use the securities for the
settlement of securities transactions. The collateral delivered to the Fund in
connection with such a transaction is then invested to provide the Fund with
additional income.
The Board recommends that shareholders approve the standardized
fundamental investment restriction concerning lending described below for each
Fund. The proposed restriction prohibits loans by the Funds except in the
circumstances described above and, in some cases, would provide more flexibility
than the current lending restriction because of the authority to engage in
securities lending. Although securities lending involves certain risks if the
borrower fails to return the securities, management believes that increased
flexibility to engage in securities lending does not materially increase the
risk to which the Funds are currently subject. Also, the adoption of the
restriction will not affect the way the Funds are currently managed or operated,
because the existing lending restrictions will remain in place as
non-fundamental policies unless and until the Board of Directors modifies them
in the future.
Proposed Lending Restriction: The Fund may not 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.
Sub-Proposal 4G: To re-classify all current fundamental investment restrictions
as non-fundamental
Each Fund currently is subject to its own list of fundamental and
non-fundamental investment restrictions. As described in the previous
Sub-Proposals, each Fund has a fundamental investment restriction governing
concentration, borrowing and senior securities, underwriting, real estate,
commodities and lending. Many of the Funds, especially the older Funds, have
additional fundamental investment restrictions governing activities that are no
longer required to be subject to fundamental investment restrictions.
The Directors and Fund management recognize that many of the current
fundamental investment restrictions cover the same activities as the proposed,
standardized fundamental investment restrictions so that there will be
overlapping restrictions. However, rather than asking shareholders for approval
to eliminate the current restrictions at this time, the Board is recommending
that all current fundamental restrictions be reclassified as non-fundamental.
After the current investment restrictions are made non-fundamental, management
and the Directors will analyze and evaluate each Fund's investment restrictions
on an individual basis while considering the particular investment objective and
policies of the Fund. Over time, the Funds' investment restrictions can be
standardized, if appropriate. The proposed reclassification of the current
investment restrictions as non-fundamental will provide the Directors with the
authority to make such changes without being required to seek an additional
shareholder vote.
Exhibit E lists the current fundamental investment restrictions of each
Fund. A number of the Funds have fundamental investment restrictions covering
activities that have not been discussed in this Proxy Statement, including
investments in: illiquid securities; other investment companies; warrants; oil
or gas leases; unseasoned companies; or investing for the purpose of exercising
control or management over an issuer. These areas are not required to be the
subject of fundamental restrictions under the 1940 Act, although a Fund is free
to designate such restrictions as fundamental if it chooses. Many Delaware
Investments Funds have designated these restrictions as non-fundamental. If this
Sub-Proposal is approved, management and the Directors will also evaluate these
other investment restrictions, with a view toward modernizing and standardizing
such restrictions for all Funds.
The conversion of investment restrictions to non-fundamental will
provide management of the Funds with the flexibility to respond to industry
changes and also to take advantage of unique pricing and distribution structures
that have developed over the past ten years. For example, eliminating certain
fundamental restrictions and converting them to non-fundamental would permit the
Funds to operate in a "master-feeder" structure at some point in the future
should management determine that such a structure were appropriate.
In a "master-feeder" structure, investors purchase shares of one or
more feeder funds which, in turn, invest all of their assets in corresponding
master funds which have identical investment objectives, policies and
restrictions as the feeder funds. The assets are collectively managed at the
master fund level and the different feeder funds can have varying distribution
and expense structures. The principal advantage of the master-feeder structure
is consolidation of investment management of multiple identical investment pools
into one investment pool. The structure is also sufficiently flexible to permit
offshore feeder funds' assets to be managed at the master fund level.
By making the investment restrictions non-fundamental, management will
have the flexibility to ensure that the investment restrictions of a Fund will
not limit the Fund's ability to operate in a master-feeder structure. Before any
existing Fund would convert to a master-feeder structure, shareholders would be
notified of such a change and the prospectus of the particular Fund would be
amended to disclose the ability to operate in a master-feeder structure.
Proposal Five: To Approve New Investment Management and Sub-Advisory Agreements
for the Fund (This Proposal Involves Separate Votes on Sub-Proposals 5a and 5b)
Sub-Proposal 5A (Investment Management Agreement) applies to all Funds except
the U.S. Government Money Fund series of Delaware Group Limited-Term Government
Funds, Inc., which is proposed to be liquidated (See Proposal Eight).
Sub-Proposal 5B (Sub-Advisory Agreement) only applies to Delaware Group Global
Dividend and Income Fund, Inc.
Proposal Overview
Shareholders of each Fund are being asked to approve a new Investment
Management Agreement with Delaware Management Company (previously defined as
"DMC"), which is each Fund's current investment manager. In addition,
shareholders of Delaware Group Global Dividend and Income Fund, Inc. are being
asked to approve a new Sub-Advisory Agreement with that Fund's current
sub-adviser, Delaware International Advisers, Ltd.
(previously defined as "DIAL").
The New Investment Management Agreements will reflect one or more of
the following changes, all of which are explained in further detail below. To
determine which proposed changes apply to your Fund, please check the table
further below.
Management fee increase of 0.05% plus the introduction of fee
"breakpoints," which reduce fee rates as Fund assets grow.
Potential management fee decrease due to the introduction of fee
breakpoints.
Change in the provision concerning shareholder approval of amendments.
Change in the provision concerning a Fund trading desk.
Addition of a provision concerning the use of a sub-adviser.
The proposed management fee changes (both increases and potential
decreases) only apply to the open-end Funds within Voyageur Investment Trust and
are designed to standardize the management fee structure for Funds within the
same investment profile categories within the Delaware Investments family and to
ensure management fee levels that will enable the Funds to continue to receive
high quality investment management services. The other proposed amendments will
change outdated provisions from older Agreements and will modernize and
standardize the form of Agreement for all Delaware Investments Funds.
The proposed new Sub-Advisory Agreement for Delaware Group Global
Dividend and Income Fund, Inc. is substantially identical to the current
Sub-Advisory Agreement, except that it contains a new provision requiring DIAL,
as sub-adviser, to share in any fee waiver or expense limitation arrangement
entered into by the investment manager. This provision does not affect the
amounts to be paid by the Fund, but DIAL may receive less, depending on
management fee waivers or expense limitations.
If shareholders approve the new Agreements, any modified management
fees will take effect on January 1, 1999, or at a later date if the Meeting is
postponed or adjourned. If a new Agreement is not approved for a particular
Fund, the current Agreement will continue in effect. The Board of Directors for
each Fund has unanimously approved the proposed Agreements and recommends that
you vote FOR the new Investment Management Agreement and, if applicable, the new
Sub-Advisory Agreement, for your Fund.
The following table lists all of the Funds for which new Investment
Management Agreements are proposed, as well as the types of changes that are
proposed for each Agreement.
Company/Fund Name Management Fee Elimination Elimination Authority
Change of Shareholder of Fund to Use
Approval of Trading Sub-Adviser
Amendments Desk
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Closed-End Funds
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware Group Dividend None X X X
and Income Fund, Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware Group Global None X X
Dividend and Income Fund,
Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Arizona None X
Municipal Income Fund,
Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Colorado Insured None X
Municipal Income Fund,
Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Florida Insured None X
Municipal Income Fund,
Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Minnesota None X
Municipal Income Fund,
Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Minnesota None X
Municipal Income Fund II,
Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Minnesota None X
Municipal Income Fund,
III, Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Open-End Funds
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Investment Trust
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware-Voyageur Potential X
Tax-Free California decrease due to
Insured Fund breakpoints
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware-Voyageur 0.05% X
Tax-Free Florida Fund increase/add
breakpoints
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware-Voyageur Potential X
Tax-Free Florida decrease due to
Insured Fund breakpoints
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware-Voyageur 0.05% X
Tax-Free Kansas Fund increase/add
breakpoints
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware-Voyageur Potential X
Tax-Free Missouri decrease due to
Insured Fund breakpoints
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware-Voyageur 0.05% X
Tax-Free New Mexico Fund increase/add
breakpoints
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware-Voyageur Potential X
Tax-Free Oregon Insured decrease due to
Fund breakpoints
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware-Voyageur 0.05% X
Tax-Free Utah Fund increase/add
breakpoints
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware-Voyageur Potential X
Tax-Free Washington decrease due to
Insured Fund breakpoints
- ----------------------------------------------------------------------
Proposed Changes in Management Fees
(Only applies to Open-End Funds within Voyageur
Investment Trust)
Purpose of Management Fees. Each Fund has hired DMC to serve as its
investment manager. Under the current Investment Management Agreements, the
portfolio management team for each Fund regularly decides which securities or
instruments to buy or sell for the Fund and the investment manager directly or
indirectly arranges for the placement and execution of orders for the purchase
or sale of such securities and instruments. The investment manager is also
responsible for each Fund's regulatory compliance and general administrative
operations and provides regular reports to the relevant Company's Board of
Directors. The management fees paid by a Fund are used by its investment manager
to pay for the personnel, equipment, office space and facilities that are needed
to manage the assets of the Fund and to administer its affairs.
Reasons for Proposed Changes in Management Fees. At the request of the
Delaware Investments Boards of Directors, management recently undertook a
complete review of the level and structure of the management fees for each Fund
within the Delaware Investments family. The extensive review process was
performed with the guidance of outside consultants to help ensure the accuracy
of the results and conclusions. The process involved the comparison of each Fund
with its own universe of "competing" funds, which were identified based on
investment objective, asset type and distribution channel. Once competing funds
were identified, management compared fee rates at various asset sizes to
evaluate both fee rates and breakpoint structures. Management's goal was to
establish a consistent fee structure for the various Delaware Investments Funds
that would be competitive with funds of similar investment objective and size in
the current marketplace.
Management believes that a competitive management fee structure is
needed to ensure that Delaware Investments will continue to be able to deliver
Funds with competitive expense ratios and provide the increased investment
opportunities and service options that are now available to shareholders. Also,
in recent years, management has noticed increased competition for talented
investment and service professionals along with growing expenses in order to
recruit and retain such personnel. By establishing fee levels at competitive
market rates, management believes it can continue to attract talented
professionals and support high-quality, long-term investment management and
shareholder services to help maintain solid investment performance.
Description of Proposed Changes in Management Fees. As a result of its
analysis, Fund management has identified a number of different management fee
pricing levels to be established for the Funds in the Delaware Investments
family, each reflecting the dynamics and complexity of managing the assets of
particular categories of Funds based on asset type (such as equity or
fixed-income), sub-divisions within asset type (such as "insured" or
"non-insured" fixed-income securities) and geography (such as domestic or
international). In addition, Fund management identified a standardized schedule
of breakpoints for open-end Funds at each of the management fee level
categories, so that management fees will be reduced if a Fund's assets grow to
certain levels, in order to allow the Funds to benefit from economies of scale.
The meetings described in this Proxy Statement are the first in a series of
meetings to be held at which the standardized management fee pricing levels and
schedules of breakpoints will be put into place for many of the Delaware
Investments Funds.
The current annual management fee rate for each of the nine Funds
within Voyageur Investment Trust is 0.50% of the average daily net assets of the
Fund. A management fee breakpoint schedule is proposed for the five Funds which
are "insured" state-specific tax-free Funds. Under the proposed fee structure,
the management fee rate will remain at 0.50% for the first $500 million of a
Fund's net assets and will decrease to 0.475% on the next $500 million, 0.45% on
the next $1,500 million and 0.425% on net assets above $2,500 million. Fees for
the four state-specific tax-free Funds which are not "insured" Funds will
increase from 0.50% to 0.55% for the first $500 million in net assets and
breakpoints will be introduced to reduce annual management fee rates to 0.50% on
the next $500 million, 0.45% on the next $1,500 million and 0.425% on net assets
above $2,500 million.
The chart included in Exhibit F, shows the current and proposed
management fee rates for each Fund and the dollar amounts paid to the investment
manager and its affiliates during the last fiscal year. If a management fee
increase is proposed, the chart shows the dollar amount that the Fund would have
paid to DMC if the proposed management fees had been in effect. The chart also
shows whether DMC has waived any management fees and the effect that such
waivers would have had on the amounts paid under the proposed Agreement. In
addition, in order to demonstrate the effect that the proposed management fee
changes are expected to have on the overall expenses of the Funds, Exhibit G
contains a Fee Table for each Fund for which a management fee increase is
proposed, showing the actual expense levels under the current management fees
and the projected expense levels following implementation of the proposed
management fees.
Board Consideration of Management Fee Changes. In considering the
proposed management fee changes, the Directors reviewed extensive materials
concerning the methodology used by management to identify competitive peer
groups for comparison and to develop proposed management fee pricing and
breakpoint levels for the various categories of Funds. At its April Board
meeting, the Directors reviewed separate reports for each Fund containing
detailed comparative management fee and expense information of each Fund and
other funds in the relevant peer group, as well as expense ratio comparisons
with relevant mutual fund indices. The Directors assessed how the management fee
changes would position each Fund within its peer group. The Directors also
reviewed and considered performance and ranking data for each Fund along with
other comparative funds within the investment objective category, as well as a
performance comparison to a relevant securities index for each Fund. In addition
to the expense and performance information, the Directors reviewed the
investment manager's historical profitability with respect to each Fund and the
anticipated effects of any management fee changes.
The Directors also considered the reasons presented by management with
respect to each proposed management fee change, including the anticipated impact
of management fee increases or decreases on shareholders of the Funds. In
support of fee increases for particular Funds, the Directors considered various
factors including the enhanced service options and investment opportunities that
are made available to shareholders, the growing expense associated with
recruiting and retaining qualified investment and service professionals in an
increasingly competitive industry and the importance of supporting quality,
long-term service by investment managers to help maintain solid investment
performance.
Following consideration of all of the information and factors discussed
above, the Directors for each Fund, including all of the independent Directors,
unanimously approved the proposed management fee changes.
Other Proposed Changes to Investment Management Agreements
In addition to modifications to the management fee structure, three
other changes to the Investment Management Agreements are proposed, one or more
of which may apply to a particular Fund. The proposed changes are designed to
eliminate provisions that appear in certain older Funds' Agreements and to
standardize the form of Agreement among all Funds within the Delaware
Investments family. Please refer to the Proposal Overview summary chart, above,
to determine whether the changes are proposed for your Fund's Agreement.
Shareholder Approval of Amendments to Investment Management Agreements.
Under the 1940 Act, shareholder approval is normally required before any fund
investment management agreement can be materially amended. The purpose of this
requirement is so that shareholders can make decisions concerning provisions of
an investment management agreement that could affect their investment.
Funds are, however, permitted to amend such agreements without
shareholder approval if the change involves a decrease in management fee rates
or a potential decrease due to the introduction or restructuring of breakpoints.
In such cases, the SEC staff believes that mutual funds should not be required
to experience the delay and costs of seeking shareholder approval, since
shareholders are generally assumed to be in favor of management fee decreases.
Certain current Investment Management Agreements require shareholder
approval of any amendment to the Agreement, regardless of whether shareholder
approval would be required under federal law. Management proposes to change the
Agreements to permit amendments without shareholder approval in appropriate
circumstances like those described above.
Elimination of Fund Trading Desk. In order for the Funds to buy and
sell securities, written instructions must be provided to brokers or dealers who
execute portfolio transactions. Although most investment management agreements
in the mutual fund industry provide that the investment manager is responsible
for selecting brokers or dealers to effect such transactions, the Agreements for
Delaware Group Dividend and Income Fund, Inc. and Delaware Group Global Dividend
and Income Fund, Inc. provide that the Funds' employees are responsible for
providing instructions to brokers or dealers relating to the execution of
portfolio transactions. As a result, these two Funds maintain a Fund trading
desk staffed by Fund personnel. Management currently believes that the
investment manager or sub-adviser should be responsible for placing portfolio
transactions rather than Fund employees and has concluded that the Agreements
should be modified accordingly.
Authority to Use Sub-Advisers. As the investment management industry
has grown increasingly specialized, it has become increasingly common for mutual
funds whose portfolios include investments in a particular specialized asset
class to utilize the services of sub-investment advisers ("sub-advisers") with
particular expertise in managing the asset class. Typically, such sub-advisory
arrangements are established with contracts between the investment manager and
the sub-adviser, with the investment manager retaining supervision over the
portfolio. For example, DIAL serves as the sub-adviser to DMC for Delaware Group
Global Dividend and Income Fund, Inc. and manages the foreign portion of that
Fund's assets.
The Investment Management Agreement for Delaware Group Dividend and
Income Fund, Inc. does not contain a provision authorizing the use of a
sub-adviser. Therefore, Fund management is proposing that the new Agreement for
that Fund contain the sub-adviser provision, in order to standardize the
Agreement with the other Delaware Investments Funds and authorize the use of
sub-advisers if the Board desires to approve the use of a sub-adviser in the
future. Any future use of a sub-adviser would also require approval by
shareholders.
Miscellaneous Changes. In addition to the changes discussed above,
there are certain miscellaneous changes designed to standardize the form of
Agreement among all Delaware Investments Funds. First, the Agreements for the
Funds that were previously part of the Voyageur fund family will reflect minor
language and structural changes to conform to the standard Delaware Investments
model Agreement. Second, each new Agreement will contain a provision recognizing
that DMC is permitted to use the names "Delaware," "Delaware Investments" or
"Delaware Group," when sponsoring Funds, series or classes, whether already
existing or to be created in the future. The first Delaware Investments Fund to
use the word "Delaware" in its name was the Delaware Fund series of Delaware
Group Equity Funds I, Inc., which was established in [ ]. DMC understands that
Delaware Fund may have a competing claim to DMC's right to the use of the name
"Delaware." Without reaching any conclusion as to the priority of such rights,
each Agreement will recognize DMC's ability to control the name in relation to
the particular Fund.
Information About the Investment Manager and Sub-Adviser
DMC serves as investment manager for each Fund. DMC is registered as an
investment adviser under the Investment Advisers Act of 1940 (the "Advisers
Act") and, together with its predecessors, has been managing funds within the
Delaware Investments family since 1938. DMC is located at One Commerce Square,
Philadelphia, Pennsylvania 19103.
DIAL serves as the sub-adviser for Delaware Group Global Dividend and
Income Fund, Inc. DIAL is a United Kingdom affiliate of DMC, is an investment
adviser registered in the United States under the Advisers Act and is a member
of the Investment Management Regulatory Organization (IMRO) in the United
Kingdom. Since 1990, DIAL has managed the overseas assets of the Funds within
the Delaware Investments family. DIAL is located at Third Floor, 80 Cheapside,
London, England EC2V 6EE.
On July 31, 1998, DMC was managing approximately $15.8 billion in
assets in various open-end and closed-end mutual fund accounts. DIAL was
managing approximately $10.5 billion in institutional or separately managed
(approximately $8.5 billion) and mutual fund (approximately $2 billion) accounts
on the same date. Both DMC and DIAL are indirect, wholly owned subsidiaries of
Lincoln National Corporation. Lincoln National Corporation, with headquarters in
Fort Wayne, Indiana, is a diversified organization involved in many aspects of
the financial services industry, including insurance and investment management.
DMC and DIAL also provide investment management or sub-advisory
services to other Funds within the Delaware Investments family which have
investment objectives that are similar to those of the Funds to which this Proxy
Statement applies. For the names of such other Funds, together with the current
(and proposed, in some cases) management or sub-advisory fee rates for such
Funds, see Exhibit H.
DMC is a series company of Delaware Management Business Trust. The
Trustees who operate the business and their principal occupations (which are
positions with DMC) are as follows: Wayne A. Stork, Chairman, Chief Executive
Officer and Chief Investment Officer; Richard G. Unruh, Jr., Executive Vice
President; David K. Downes, Executive Vice President, Chief Operating
Officer and Chief Financial Officer; and George M. Chamberlain, Jr., Senior Vice
President and Secretary.
Wayne A. Stork is the Chairman, Chief Executive Officer and a
Director of DIAL. David G. Tilles is the Managing Director, Chief
Investment Officer and a Director of DIAL. In addition to Mr. Stork and Mr.
Tilles, the present directors of DIAL and their principal occupations
(unless noted in the paragraph above relating to DMC) are as follows: Jeffrey
J. Nick [which of Nick's positions shown in Proposal One is his "principal"
occupation?]; G. Roger H. Kitson, Vice Chairman of DIAL; Richard G. Unruh;
David K. Downes; Richard J. Flannery, [principal occupation]; George M.
Chamberlain, Jr.; John C. E. Campbell, Executive Vice President of DIAL;
Hamish O. Parker, Senior Portfolio Manager/Director U.S. Marketing
Liaison of DIAL; Timothy W. Sanderson, Senior Portfolio Manager/Deputy
Compliance Officer/Director Equity Research of DIAL; Clive A. Gillmore,
Senior Portfolio Manager/Director U.S. Mutual Fund Liaison of DIAL; Ian G. Sims,
Deputy Managing Director/ Chief Investment Officer/Global Fixed Income of
DIAL; George E. Deming, Vice President/Senior Portfolio Manager of DIAL; John
Emberson, Secretary, Compliance Officer and Finance Director of DIAL; Nigel
G. May, Senior Portfolio Manager/Head of European Group of DIAL; Elizabeth A.
Desmond, Senior Portfolio Manager/Head of Pacific Basin Group of DIAL. All
of the above officers and directors of DIAL may be contacted at Third Floor,
80 Cheapside, London, England EC2V 6EE.
Other Information Relevant to Approval of
Investment Management and Sub-Advisory Agreements
The form of proposed Investment Management Agreement for the Funds is
attached as Exhibit I and the form of proposed Sub-Advisory Agreement for
Delaware Group Global Dividend and Income Fund, Inc. is attached as Exhibit J.
Each Current and Proposed Agreement has an initial term of two years and
provides that it will thereafter continue in effect from year to year only if
such continuation is specifically approved at least annually with respect to
each Fund by (i) a vote of a majority of the Board of Directors, or (ii) a vote
of a majority of the outstanding voting securities of the Fund, and (iii) in
either case, separately by a majority of the Directors who are not "interested
persons" (as defined in the 1940 Act). Each current and proposed Agreement may
be terminated without penalty by (i) the Fund, by a vote of a majority of the
Board of Directors, or (ii) by a vote of a majority of the outstanding voting
securities of a Fund, or (iii) by DMC or DIAL, as relevant, at any time on 60
days' written notice. Each Agreement will also terminate automatically upon its
"assignment," as that term is defined in the 1940 Act.
Under each of the current and proposed Agreements, best efforts are
used 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 investment manager, sub-adviser or their
advisory clients. To the extent consistent with the requirements of the rules of
the SEC and the National Association of Securities Dealers, Inc. ("NASD"), these
orders may be placed with brokers who sell shares of the Funds. The services
provided may 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 investment manager or sub-adviser in connection with their
investment decision-making process with respect to one or more Funds or accounts
that they manage, and need not be used exclusively with respect to the Fund or
account generating the brokerage.
As provided in the Securities Exchange Act of 1934 and the current and
proposed Agreements, 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. In some instances, services provided constitute in some part
brokerage and research services used in connection with the investment
decision-making process and constitute in some part services used in connection
with administrative or other functions not related to the investment
decision-making process. In such cases, the investment manager or sub-adviser
will make a good faith allocation of brokerage and research services and will
pay out of their own resources for services used by them in connection with
administrative or other functions not related to the investment decision-making
process.
The current and proposed Agreements provide that, in the absence of
willful misfeasance, bad faith, gross negligence or a reckless disregard of the
performance of its duties to a Fund, the investment manager or sub-adviser shall
not be liable to the Fund or any shareholder of the Fund for any action or
omission in the course of, or in connection with, rendering services under a
current or proposed Agreement or for any losses that may be sustained in the
purchase, holding or sale of any security or otherwise.
Other Agreements with the Funds
Voyageur Investment Trust is currently party to a Distribution
Agreement relating to the Funds with Delaware Distributors, L.P. (the
"Distributor"), an affiliate of DMC and DIAL. The Distributor's principal
address is 1818 Market Street, Philadelphia, PA 19103. Pursuant to the
Distribution Agreement, the Distributor provides underwriting, distribution and
marketing services to the Funds. The Agreement includes references to
distribution plans adopted pursuant to Rule 12b-1 under the 1940 Act. The
Companies are all currently parties to shareholder servicing and fund accounting
agreements with Delaware Service Company, Inc. ("DSC"), an affiliate of DMC and
DIAL, pursuant to which DSC provides shareholder servicing, dividend disbursing
and transfer agency services.
DSC also performs administrative and accounting services for the
Closed-End Funds pursuant to a Fund Administration and Accounting Agreement with
each Closed-End Fund. Under the agreement, DSC calculates each Fund's daily net
asset value, performs financial reporting and portfolio compliance testing, and
maintains comprehensive administrative records for the Funds.
Exhibit K to this Proxy Statement lists the amount of any payments made
to DSC pursuant to service agreements or to the Distributor pursuant to Rule
12b-1 Plans, for each Fund's most recently completed fiscal year.
Proposal Six: To Ratify the Selection of Ernst & Young, LLP as Independent
Auditors for the Company.
The Boards of Directors have selected Ernst & Young LLP as independent
auditors of each Company for the current fiscal year and shareholders are asked
to ratify this selection. A representative from Ernst & Young will be present at
the meeting. The representative of Ernst & Young will have an opportunity to
make a statement if he or she desires to do so and will be available to respond
to appropriate questions. The Companies' Audit Committee meets periodically with
the representatives of Ernst & Young to receive reports from Ernst & Young and
plan for the Companies' audits.
Required Vote. A simple majority (more than 50%) of the outstanding
voting securities of each Company, regardless of individual Funds within a
Company, is required to ratify the selection of Ernst & Young LLP as independent
auditor for each such Company, except that the shareholders of Delaware Group
Global Dividend and Income Fund, Inc. and Voyageur Investment Trust may ratify
the auditor selection with a majority of "votes cast," which could be less than
50% of a Company's outstanding voting securities.
The Board of Directors of each Company unanimously recommends that you ratify
the selection of Ernst & Young, LLP as independent auditors for such Company for
the current fiscal year.
Proposal Seven: To Approve the Reorganization from a Massachusetts Business
Trust into a Maryland Corporation for Voyageur Investment Trust and Voyageur
Florida Insured Municipal Income Fund
The Boards of Trustees of Voyageur Investment Trust ("Investment
Trust") and Voyageur Florida Insured Municipal Income Fund ("Florida Fund")
(individually, a "Current Board" and collectively, the "Current Boards") have
approved separate Agreements and Plans of Reorganization (individually, a "Plan"
and collectively, the "Plans") substantially in the form attached to this Proxy
Statement as Exhibit M. Each Plan provides for a reorganization (individually, a
"Reorganization" and collectively, the "Reorganizations") pursuant to which each
Company will change its domicile and form of organization from a Massachusetts
business trust to a Maryland corporation. Investment Trust and Florida Fund may
be referred to in this Proposal individually as a "Current Fund" and
collectively as the "Current Funds." The respective series of shares of
Investment Trust are referred to in this Proposal individually and collectively
as the "Current Series."
With respect to each Current Fund, the Reorganization involves the
continuation of the Current Fund in the form of a newly created Maryland
corporation. Separate classes and series of shares of each Maryland corporation
which correspond to the classes and series of each Current Fund will carry on
the business of the Current Fund. The newly created Maryland corporations are
referred to in this Proposal individually as a "New Corporation" and
collectively as the "New Corporations." With respect to Investment Trust, the
series of shares of the New Corporation which correspond to the Current Series
of shares of Investment Trust are referred to in this Proposal individually and
collectively as the "New Series."
Under the Reorganization, the investment objectives of each New
Corporation and New Series will be the same as those of its corresponding
Current Fund and Current Series, as applicable; the portfolio securities of each
Current Fund and Current Series will be transferred to its corresponding New
Corporation and New Series, as applicable; and shareholders will own interests
in each New Corporation that are equivalent to their interests in the Current
Fund on the closing date of the Reorganization. The trustees, and the officers
and employees of each Current Fund on the effective date of the Reorganization
will become the directors, officers and employees of the corresponding New
Corporation, respectively, and will operate the New Corporation in the same
manner as they previously operated the Current Fund. Delaware Management Company
(previously defined as "DMC") will be responsible for the investment management
of each New Corporation and New Series, as applicable. In essence, a
shareholder's investment in a Current Fund will not change for all practical
purposes.
Background and Reasons for the Reorganizations. The Current Boards
unanimously recommend conversion of the Current Funds into Maryland corporations
because they have determined that the Maryland corporate form of organization
provides certain administrative advantages to the funds. Specifically, the
Reorganizations would increase uniformity among the funds within the Delaware
Investments family, which are primarily organized as Maryland corporations.
Increased uniformity among the funds, many of which share common directors,
officers and service providers, is expected to reduce the costs and resources
devoted to compliance with varying state corporate or trust laws and also reduce
administrative burdens.
Maryland corporate law contains provisions specifically designed for
mutual funds, which take into account their unique structure and operations, and
allows funds to simplify their operations by reducing administrative burdens to
generally operate more efficiently. For example, as with Massachusetts business
trusts, funds organized as Maryland corporations are not required to hold annual
shareholders' meetings if meetings are not otherwise required by the federal
securities laws, the charter or bylaws, and such funds may create new classes or
series of stock without having to obtain the approval of shareholders at a
meeting. Another advantage that is afforded to a mutual fund organized as a
Maryland corporation is that there is a well established body of corporate
precedent which may be relevant in deciding issues pertaining to the
corporation.
For these reasons, the Current Boards believe it is in the interest of
shareholders of the Current Funds to reorganize the Current Funds into Maryland
corporations. At present, it appears that the most advantageous time to
consummate the Reorganizations is on or before December 31, 1998. With respect
to each Current Fund, if the Reorganization is approved by shareholders, the
Reorganization will be consummated on such date as the Current Board deems
advisable and in the best interest of shareholders. The Current Board reserves
the right to abandon the Reorganizations if it determines that such action is in
the best interest of the Current Funds.
The following discussion under the captions "Consequences and Procedures of the
Reorganization," "Capitalization and Structure," "Effects of Shareholder
Approval of the Reorganization," "Federal Income Tax Consequences of the Plan,"
and "Expenses of the Reorganization" applies to the Reorganization of each
Current Fund, except where otherwise specifically noted.
Consequences and Procedures of the Reorganization. Upon consummation of
the Reorganization, the New Corporation will continue the Current Fund's
business with the same investment objectives, policies and restrictions that are
in effect for the Current Fund at the time of the consummation of the
Reorganization (see the discussion under "Investment Policies and Restrictions"
below). The net asset value of the shares of each class of each Current Series,
and the net asset value of the common shares of the Florida Fund, will not be
affected by the Reorganization. The New Corporation has been organized
specifically for the purpose of effecting the Reorganization. Immediately prior
to the effective date of the Reorganization (as defined in the Plan), the New
Corporation corresponding to Investment Trust will have outstanding only one
share of each class of stock of each New Series corresponding to the shares of
each class of stock of each Current Series. Immediately prior to the effective
date of the Reorganization, the New Corporation corresponding to the Florida
Fund will have outstanding only one share of each class, common and preferred,
and series corresponding to the shares of each class and series of stock of the
Florida Fund. The Current Fund will be the sole holder of the shares of such
stock. The Plan contemplates that the trustees serving at the time of the
Reorganization will serve as directors of the New Corporation, with comparable
responsibilities, if the shareholders give the requisite approval at the
meeting. The officers of the Current Fund will become officers of the New
Corporation with comparable responsibilities. The Reorganization will not result
in the recognition of income, gain or loss for Federal income tax purposes to
the Current Fund, the New Corporation or the holders of shares of the Current
Fund. (See "Federal Income Tax Consequences of the Plan.")
To accomplish the Reorganization, the Plan provides that the Current
Fund will transfer all of its assets or the assets of the Current Series, as
applicable, subject to its related liabilities, to the New Corporation and, if
applicable, to each of its corresponding New Series. The New Corporation will
establish an open account for each shareholder and will credit to that account
the exact number of full and fractional shares of the class of the New Series
(or the exact number of full and fractional shares of the class and series of
the New Corporation corresponding to the Florida Fund) that such shareholder
previously held in the same class of the corresponding Current Series (in the
same class and series of the Florida Fund) on the effective date of the
Reorganization. Each shareholder will retain the right to any declared but
undistributed dividends or other distributions payable on the shares of the
Current Fund and Current Series, as applicable, that he or she owned. On the
date of the Reorganization, the net asset value per share of each class of each
Current Series, and the net asset value of the common shares of the Florida
Fund, will be the same as the net asset value per share of the corresponding
class of the New Series or net asset value per share of the common shares of the
New Corporation corresponding to the Florida Fund. The New Corporation will
assume all liabilities and obligations of its corresponding Current Fund. As
soon as practicable after the effective date of the Reorganization, the Current
Fund will be dissolved and its existence terminated.
With respect to the Florida Fund, the holders of the preferred shares
will continue to have the same privileges, preferences and limitations and
substantially the same dividend and voting rights as they had prior to the
Reorganization. The dividends applicable to the preferred shares will be
determined, declared and paid in the same manner using the same procedures as
prior to the Reorganization. The holders of the preferred shares are subject to
rating agency guidelines which are set forth in the resolutions of the Board of
Trustees and are part of the Declaration of Trust of the Florida Fund.
Securities are given ratings by independent rating organizations which grade the
company issuing the securities based upon its financial soundness. The rating
agency guidelines govern the manner in which the preferred shares are rated by
rating agencies, which currently include Moody's Investors Service, Inc.
("Moody's") and Standard & Poor's Ratings Group ("S&P"). The Board of Trustees
has approved a modification of the guidelines to permit the Reorganization, but
the modification is subject to the receipt of written confirmation from Moody's
and S&P that the modification of the guidelines and the Reorganization will not
impair the ratings currently assigned to the preferred shares. Moody's and S&P
have been notified of the modification of the guidelines and the Reorganization
and have given no indication that the modification or Reorganization will impair
such ratings. It is anticipated that Moody's and S&P will provide the requisite
written confirmations prior to the effective date of the Reorganization of
Florida Fund. If Moody's and S&P do not provide such written confirmations, the
Board of Trustees of the Florida Fund will take steps to meet any concerns
presented by the rating agencies and, if the rating agencies still do not
provide such written confirmations, will terminate or abandon the
Reorganization.
On the effective date of the Reorganization, each certificate
representing shares of a class of a Current Series (representing shares of a
class and series of the Florida Fund) will represent an identical number of
shares of the same class of the corresponding New Series (of the same class and
series of the New Corporation corresponding to the Florida Fund). Shareholders
will have the right to exchange their certificates of the Current Fund for
certificates of the New Corporation. A shareholder, however, is not required to
make this exchange of certificates.
The Plan provides that the effective date of the Reorganization will be
(i) the next business day after the later of the receipt of all necessary
regulatory approvals and the final adjournment of the meeting of shareholders of
the Current Fund at which the Plan will be considered or (ii) such later date as
the Current Fund and the New Corporation may mutually agree. It is expected that
this will be on December 31, 1998, or such earlier time as the Current Board
deems advisable and in the best interest of the Current Fund and its
shareholders. The Plan may be terminated and the Reorganization abandoned at any
time prior to the effective date of the Reorganization by the Current Board. If
the Reorganization is not so approved or if the members of the Current Board
determine to terminate or abandon the Reorganization, the Current Fund will
continue to operate as a Massachusetts business trust.
Capitalization and Structure. Investment Trust was organized as a
Massachusetts business trust pursuant to an Agreement and Declaration of Trust
dated September 16, 1991. It has an unlimited number of shares of beneficial
interest authorized, without par value. The shares of Investment Trust have been
divided into nine separate series with four classes of shares of each such
series. The New Corporation corresponding to Investment Trust was incorporated
under the Maryland General Corporation Law (the "Maryland Code") on September
16, 1998. It has authorized capitalization of 2,000,000,000 shares of common
stock, par value $0.01 per share. The Board of Directors of the New Corporation
has the power to designate one or more classes and series of shares of common
stock and to classify and reclassify any unissued shares with respect to each
class and series. Initially, the New Corporation has designated the same number
of classes and series as its corresponding Current Fund.
With respect to Investment Trust, shares of the respective classes of
the New Series have the same dividend, redemption, voting, exchange and
liquidation rights, and terms of conversion as the corresponding Current Series.
Shares of the respective classes of both the Current Series and the
corresponding New Series are fully paid, non-assessable, and freely transferable
and have no preemptive or subscription rights.
The Florida Fund was organized as a Massachusetts business trust
pursuant to a Declaration of Trust dated December 29, 1992. It has an unlimited
number of common shares of beneficial interest and an unlimited number of
preferred shares of beneficial interest authorized. The Florida Fund has
2,422,200 common shares issued and outstanding. The preferred shares are issued
in two series, with 200 shares designated as Municipal Income Preferred Shares,
Series A, and 200 shares designated as Municipal Income Preferred Shares, Series
B. All shares have a par value of $0.01 per share. The New Corporation was
incorporated under the Maryland Code on September 16, 1998. Articles of
Amendment and Restatement of the New Corporation were filed on October __, 1998,
which provide for authorized capitalization of 2,422,200 shares of common stock
and 400 shares of preferred stock, par value of $0.01 per share, of which 200
shares of preferred stock are designated Municipal Income Preferred Shares,
Series A, $0.01 par value per share, and 200 shares of preferred stock are
designated Municipal Income Preferred Shares, Series B, $0.01 par value per
share.
With respect to the Florida Fund, shares of the respective series and
classes of the corresponding New Corporation have substantially the same
dividend and voting rights and the same liquidation rights, preferences, and
terms and conditions of redemption and repurchase, as the corresponding Current
Fund. Shares of the respective classes and series of both the Florida Fund and
the corresponding New Corporation have no preemptive or subscription rights.
Prior to the Reorganization, the New Corporation will have nominal
assets and no liabilities. The sole shareholder of the New Corporation will be
the corresponding Current Fund. Each New Corporation and New Series will have
the same investment objective and policies as its corresponding Current Fund and
Current Series, as applicable. (See the discussion under "Investment Policies
and Restrictions" below.) DMC will provide investment management services to the
New Corporation and the New Series as it does to the Current Fund and the
Current Series, as applicable. The New Corporation will have the same fiscal
year as the Current Fund.
Subsequent to the closing of the Reorganization, shares of the
respective classes of the Current Series (the respective classes and series of
the Florida Fund) will be exchanged for an identical number of shares of the
same class of the corresponding New Series (the same class and series of the
corresponding New Corporation in the case of the Florida Fund). Thereafter, for
Investment Trust, shares of each class of the New Series will be available for
issuance at their net asset value, applicable at the time of sale. The New
Corporation will adopt the Current Fund's existing registration statement under
the 1940 Act and, with respect to the Investment Trust, under the Securities Act
of 1933.
Effects of Shareholder Approval of the Reorganization. An investment
company registered under the 1940 Act is required to: (1) submit the selection
of the company's independent auditors to all shareholders for their
ratification; (2) call a special meeting to elect directors (trustees) within 60
days if, at any time, less than one half of the directors (trustees) holding
office have been elected by all shareholders; and (3) submit any proposed
investment management agreement relating to a particular series of the
investment company to the shareholders of that series for approval.
The Current Board believes that it is in the best interest of the
shareholders of the Current Fund (who will become the shareholders of the
corresponding New Corporation if the Reorganization is approved) to avoid the
considerable expense of another shareholders' meeting to obtain the shareholder
approvals described above shortly after the closing of the Reorganization and,
in the case of the Florida Fund, to avoid the expense of holding a special
shareholders' meeting in addition to the regular annual meeting. The Current
Board also believes that it is not in the best interest of the shareholders to
carry out the Reorganization if the surviving New Corporation would not have a
Board of Directors, independent auditors, and an investment management agreement
complying with the 1940 Act.
The Current Board will, therefore, consider that approval of the
Reorganization by the requisite vote of the shareholders of the Current Fund to
constitute the approval of the Plan contained in Exhibit M, and will also
constitute, for the purposes of the 1940 Act: (1) ratification of the
independent auditors for each Current Fund at the time of the Reorganization to
be the New Corporation's independent auditors (please see Proposal 6); (2)
election of the Directors (Trustees) of the Current Fund who are in office at
the time of the Reorganization as the directors of the New Corporation after the
closing of the Reorganization (please see Proposal 1); (3) approval by the
shareholders of each Current Series of the investment management agreement
between the New Corporation and DMC for the New Series, which will be
substantially identical to the agreement that is in place between the Current
Fund and DMC for the corresponding Current Series of Investment Trust on the
effective date of the Reorganization (please see Proposal 5A); and (4) approval
by the shareholders of the Florida Fund of the investment management agreement
between the corresponding New Corporation and DMC, which will be substantially
identical to the agreement that is in place between Florida Fund and DMC on the
effective date of the Reorganization (please see Proposal 5A).
The New Corporation will issue a single share of each class of stock of
the New Series (a single share of each class and series of stock of the
corresponding New Corporation of the Florida Fund) to the Current Fund, and,
assuming approval of the Reorganization by shareholders of the Current Fund, the
officers of the Current Fund, prior to the Reorganization, will cause the
Current Fund, as the sole shareholder of the New Corporation, to vote such
shares "FOR" the matters specified in the above paragraph. The Current Fund will
then consider the requirements of the 1940 Act referred to above to have been
satisfied.
The mailing address and telephone number of the principal executive
offices of both the Current Fund and New Corporation are 1818 Market Street,
Philadelphia, PA 19103, and (800) 523-1918, respectively.
Federal Income Tax Consequences of the Plan. It is anticipated that the
transactions contemplated by the Plan will be tax-free for federal income tax
purposes. Consummation of the Reorganization is subject to receipt of a legal
opinion from the law firm of Stradley, Ronon, Stevens & Young, LLP, counsel to
the Current Fund and New Corporation, that under the Internal Revenue Code of
1986, as amended (the "Internal Revenue Code"), the exchange of assets of the
Current Fund for the shares of the corresponding New Corporation, the transfer
of such shares to the holders of shares of Current Fund and the dissolution and
liquidation of the Current Fund pursuant to the Plan will not give rise to the
recognition of a gain or loss for Federal income tax purposes to the Current
Fund, the New Corporation or shareholders of the Current Fund or the New
Corporation. A shareholder's adjusted basis for tax purposes in the shares of
the New Corporation after the exchange and transfer will be the same as his
adjusted basis for tax purposes in the shares of the corresponding Current Fund
immediately before the exchange. Each shareholder should consult his own tax
adviser with respect to the details of these tax consequences and with respect
to state and local tax consequences of the proposed transaction.
A representative of Ernst & Young LLP, independent auditors for
Investment Trust and the Florida Fund and the New Corporations, will be present
at the meeting and will have an opportunity to make a statement if he or she
desires to do so and will be available to respond to appropriate questions.
Investment Policies and Restrictions. If the investment policies and
restrictions for the Current Fund and Current Series as proposed and set forth
in Proposals Three, Four and Five are approved by shareholders, the investment
policies and restrictions of the corresponding New Corporation and New Series
will be the policies and restrictions of the Current Fund and Current Series as
amended by the provisions set forth in such Proposals. For each Current Fund and
Current Series for which the investment policies and restrictions set forth in
Proposals Three, Four and Five are not approved, the investment policies and
restrictions of the corresponding New Corporation and New Series after the
Reorganization will be the investment policies and restrictions of that Current
Fund and Current Series immediately prior to the Reorganization.
Investment Management Agreements. If the proposed new investment
management agreement with DMC relating to the Current Fund and Current Series,
as applicable, as proposed and described in Proposal Six (a "New Agreement") is
approved by the shareholders of the Current Fund and Current Series, the terms
of the investment management agreement for the New Corporation and New Series
will be substantially identical to the New Agreement for the Current Fund and
Current Series. For each Current Fund and Current Series for which the New
Agreement described in Proposal Six is not approved, if any, the investment
management agreement for the corresponding New Corporation and New Series will
be substantially identical to the existing investment management agreement
currently in place for that Current Fund and Current Series, as applicable.
Distribution Plans and Shareholder Servicing Arrangements. The New
Corporation corresponding to Investment Trust will enter into agreements with
Delaware Service Company, Inc. ("DSC") for transfer agency, dividend disbursing
and shareholder servicing and fund accounting services which are substantially
identical to the agreements currently in effect for each corresponding Current
Fund for such services. With respect to the New Corporation corresponding to
Investment Trust, Delaware Distributors, L.P. ("DDLP") will serve as the
national distributor for the shares of the New Series under a separate
distribution agreement between DDLP and the New Corporation, which is
substantially identical to the distribution agreement currently in effect for
the Current Series.
The New Corporation corresponding to the Florida Fund will enter into
an agreement with Norwest Bank Minnesota, N.A. for transfer agency services
which is substantially identical to the agreement currently in effect between
Norwest Bank Minnesota, N.A. and the Florida Fund. The New Corporation
corresponding to the Florida Fund will enter into agreements with DSC for
administrative services and fund accounting services which are substantially
identical to the agreements currently in effect between DSC and the Florida
Fund.
Investment Trust has adopted distribution plans under Rule 12b-1 of the
1940 Act (each a "Distribution Plan") relating to certain classes of shares of
the Current Series. For each class of shares of Investment Trust that is subject
to a Distribution Plan, the corresponding New Corporation also has adopted a
Distribution Plan that is substantially identical to the Plan currently in place
for the same class of shares of that Current Series.
Requests for Redemption of Investment Trust. Any request to redeem
shares of Investment Trust that is received and processed prior to the
Reorganization will be treated as a redemption of shares of Investment Trust.
Any request to redeem shares of Investment Trust received or processed after the
Reorganization will be treated as a request for the redemption of shares of the
corresponding New Corporation.
Expenses of the Reorganization. Because the Reorganization will benefit
solely the Current Fund and its shareholders, the Current Board has authorized
that the expenses incurred by the Current Fund in the Reorganization or arising
out of the Reorganization shall be paid by the Current Fund, whether or not the
Reorganization is approved by the shareholders.
Comparison of Legal Structures. A comparison of the Massachusetts
statutory provisions governing business trusts ("Massachusetts Statute") with
the Maryland Code, as well as a comparison of relevant provisions of the
governing documents of the Current Funds and the New Corporations, is included
in Exhibit M, which is entitled "Differences in Legal Structures."
Required Vote. The Plans and the transactions contemplated thereby, including
the liquidation and dissolution of the Current Funds, requires the approval of
the shareholders as set forth below:
* Investment Trust - The vote of a "majority
of the outstanding voting securities" of
Investment Trust, which means the vote of :
(i) more than 50% of the outstanding voting
securities of Investment Trust; or (ii) 67%
or more of the voting securities of
Investment Trust present at a meeting, if
the holders of more than 50% of the
outstanding voting securities are present or
represented by proxy, whichever is less.
* Florida Fund - The affirmative vote of a majority of all votes
entitled to be cast at the meeting (shares of each class voting
together as a single class).
The Board of Trustees unanimously recommends that you vote FOR the
Reorganization.
Proposal Eight: To Approve a Plan of Liquidation and Dissolution for the U.S.
Government Money Fund series of Delaware Group Limited-Term Government Funds,
Inc.
This Proposal only applies to the U.S. Government Money Fund series of Delaware
Group Limited - Term Government Funds, Inc.
You are being asked to consider and approve a Plan of Liquidation and
Dissolution ("Liquidation Plan") which would result in the liquidation of the
U.S. Government Money Fund and the proceeds from such liquidation being
distributed to you in proportion to the value of your shares.
In September 1998, management of U.S. Government Money Fund presented
to the Board of Directors a proposal for the liquidation and dissolution of the
Fund. Representatives of DMC and the Distributor were present at the meeting to
discuss the Fund's previous operating history, including its performance, as
well as the historical and anticipated sales activity. In management's view, the
Fund's current size prevents its efficient operation. In particular, the expense
ratio is not competitive without voluntary fee waivers and expense payments by
the investment manager. For example, in the Fund's 1996 and 1997 fiscal years,
total expenses represented 0.74% and 0.70%, respectively, of the Fund's average
net assets, after waiver of all management fees and payment of expense
reimbursements. Had such waivers and reductions not been made in the Fund's 1996
and 1997 fiscal years, total expenses would have represented 1.56% and 1.22%,
respectively, of the Fund's average net assets. Similarly, the Fund has not been
popular because of the industry-wide disinterest in government money market
funds. In general, investors have turned to higher yielding, high quality money
market funds. Given the decreased interest in the Fund over the last seven
years, management believes that the potential for significant cash inflows in
the future is not high.
In light of the above, management recommended that the Board vote to
liquidate and dissolve the Fund. After analyzing the factors described above,
and considering the alternatives to liquidating the Fund, the Board unanimously
determined that liquidation and dissolution of the Fund is in the best interests
of the shareholders and approved the Liquidation Plan.
Plan of Liquidation and Dissolution. The Board of Directors has
approved the Liquidation Plan set forth in Exhibit N to this Proxy Statement. If
the shareholders vote to liquidate the Fund, the liquidation will be carried out
according to the terms of the Liquidation Plan. The terms of the Liquidation
Plan are summarized here.
1. Effective Date of the Liquidation Plan and Cessation of the Fund's
Business. The Liquidation Plan will become effective on the date that it is
adopted and approved by shareholders. Following shareholder approval, the Fund
will cease making new investments in accordance with its investment objective.
In addition, the Fund will not engage in any business activities except to
dispose of portfolio securities and to distribute its assets to its shareholders
(after it pays in full its creditors) and to wind up its affairs.
2. Closing of Books and Restriction of Transfer and Redemption of
Shares. On the effective date, the books of the Fund will be closed and the
shareholders' proportionate interests in the Fund will be fixed. Once the
interests are fixed pursuant to this Liquidation Plan, shareholders will no
longer be able to redeem shares of the Fund, rather, they will receive a
liquidating distribution. Shareholders may continue to redeem their shares up to
the effective date.
3. Liquidating Distribution. As soon as possible after the Fund has
disposed of its portfolio securities, and in any event within [_____________]
days of approval of the Liquidation Plan, the Fund will mail to each
shareholder: (1) a distribution amount equal to the shareholder's proportionate
interest in the net assets of the Fund; and (2) information concerning the
sources of the liquidating distribution.
4. Expenses. The Fund will pay all of the expenses incurred in carrying
out the Liquidation Plan. Before the liquidating distribution is mailed to
shareholders, the Fund will pay other expenses and liabilities incurred (or
expected to be incurred) by the Fund before the distribution.
5. Dissolution of the Fund. After the liquidating distribution is
mailed to shareholders, the Fund will be dissolved in accordance with the laws
of the state of Maryland. The Directors will have the authority to authorize
variations from, or changes to, the Liquidation Plan if appropriate to
accomplish the liquidation and dissolution.
If the Liquidation Plan is approved, you will receive a distribution in
an amount equal to your interest in the net assets of the Fund as determined on
the effective date.
Tax Consequences. You will recognize gain or loss on the liquidating
distribution equal to the difference between your basis in the Fund shares
liquidated and the proceeds received therefor. Such gain or loss will be capital
if the Fund shares were held as capital assets. For each individual shareholder,
such gain or loss will be short-term if the Fund shares were held one year or
less on the date of the liquidating distribution; mid-term if held more than one
year but eighteen months or less on the date of the liquidating distribution; or
long-term if held more than eighteen months on the date of the liquidating
distribution. Net short-term gains of individuals are taxed at the same rate as
ordinary income; net mid-term gains are taxed at the maximum rate of 28%; and,
net long-term gains are taxed at the maximum tax rate of 20%.
Required Vote. The Board of Directors is asking you to vote on the
proposal to liquidate the Fund. According to the Company's Articles of
Incorporation, an affirmative vote by a majority of all votes entitled to be
cast is necessary to approve the Liquidation Plan. If the shareholders do not
approve the Liquidation Plan, the Fund will continue to operate, offer its
shares and invest its assets in accordance with its stated objectives and
policies. The Board may then consider other alternatives for the future of the
Fund.
The Board of Directors unanimously recommends that you vote FOR the approval of
the Liquidation Plan.
EXHIBIT A
DELAWARE INVESTMENTS FUNDS
OUTSTANDING SHARES AS OF RECORD DATE
- --------------------------------------------------------------------
COMPANY/FUND RECORD SHARES SHARES OWNED
DATE OUTSTANDING BY FUND
ON EXECUTIVE
RECORD AND
DATE* OFFICERS AS
A GROUP AS
OF JULY 31,
1998
- --------------------------------------------------------------------
- --------------------------------------------------------------------
DELAWARE GROUP LIMITED-TERM
GOVERNMENT FUNDS, INC.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
U.S. Government Money Fund 9/7/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
VOYAGEUR INVESTMENT TRUST
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Delaware-Voyageur Tax-Free 9/7/98
California Insured Fund
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Delaware-Voyageur Tax-Free 9/7/98
Florida Fund
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Delaware-Voyageur Tax-Free 9/7/98
Florida Insured Fund
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Delaware-Voyageur Tax-Free 9/7/98
Kansas Fund
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Delaware-Voyageur Tax-Free 9/7/98
Missouri Insured Fund
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Delaware-Voyageur Tax-Free New 9/7/98
Mexico Fund
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Delaware-Voyageur Tax-Free 9/7/98
Oregon Insured Fund
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Delaware-Voyageur Tax-Free 9/7/98
Utah Fund
- --------------------------------------------------------------------
Delaware-Voyageur Tax-Free 9/7/98
Washington Insured Fund
- --------------------------------------------------------------------
DELAWARE GROUP DIVIDEND AND 9/7/98
INCOME FUND, INC.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
DELAWARE GROUP GLOBAL DIVIDEND 9/7/98
AND INCOME FUND, INC.
- --------------------------------------------------------------------
VOYAGEUR ARIZONA MUNICIPAL INCOME
FUND, INC.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Common Stock 10/6/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Preferred Stock 10/6/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
VOYAGEUR COLORADO INSURED
MUNICIPAL INCOME FUND, INC.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Common Stock 10/6/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Preferred Stock 10/6/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
VOYAGEUR FLORIDA INSURED
MUNICIPAL INCOME FUND
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Common Stock 9/7/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Preferred Stock 9/7/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
VOYAGEUR MINNESOTA MUNICIPAL
INCOME FUND, INC.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Common Stock 10/6/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Preferred Stock 10/6/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
VOYAGEUR MINNESOTA MUNICIPAL
INCOME FUND II, INC.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Common Stock 10/6/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Preferred Stock 10/6/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
VOYAGEUR MINNESOTA MUNICIPAL
INCOME FUND III, INC.
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Common Stock 10/6/98
- --------------------------------------------------------------------
- --------------------------------------------------------------------
Preferred Stock 10/6/98
- --------------------------------------------------------------------
*The shares outstanding on the record date include all shares purchased in
transactions which have settled by the record date.
EXHIBIT B
- ----------------------------------------------------------------------
YEARS THAT DIRECTORS OR TRUSTEES FIRST TOOK OFFICE
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Wayne Walter John Anthony Ann W. Thomas Jeffrey Charles
A. B. H. D. R. Thacher F. J. E.
Stork Babich Durham* Knerr Leven Longstreth Madison Nick Peck
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware Group 1993 1993 1993 1993 1993 1993 1997 1997 1993
Dividend and
Income Fund, Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Delaware Group 1993 1993 1993 1993 1993 1993 1997 1997 1993
Global Dividend
and Income Fund,
Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Arizona 1997 1997 N/A 1997 1997 1997 1994 1997 1997
Municipal Income
Fund, Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Colorado 1997 1997 N/A 1997 1997 1997 1994 1997 1997
Insured Municipal
Income Fund, Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur Florida 1997 1997 N/A 1997 1997 1997 1994 1997 1997
Insured Municipal
Income Fund
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur 1997 1997 N/A 1997 1997 1997 1994 1997 1997
Investment Trust
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur 1997 1997 N/A 1997 1997 1997 1994 1997 1997
Minnesota
Municipal Income
Fund, Inc.
- ----------------------------------------------------------------------
- ----------------------------------------------------------------------
Voyageur 1997 1997 N/A 1997 1997 1997 1994 1997 1997
Minnesota
Municipal Income
Fund II, Inc.
- ----------------------------------------------------------------------
Voyageur 1997 1997 N/A 1997 1997 1997 1994 1997 1997
Minnesota
Municipal Income
Fund III, Inc.
- ----------------------------------------------------------------------
* John H. Durham became a Director of the Companies in the years noted above
On January 28, 1995, he was appointed Director Emeritus of the Companies.
On April 16, 1998, he was reappointed as a Director.
EXHIBIT C
EXECUTIVE OFFICERS OF THE COMPANIES
- -------------------------------------------------------------
David K. Downes (58) Executive Vice President, Chief Operating Officer, Chief
Financial Officer of each of the 34 investment companies in the Delaware
Investments family, Delaware Management Holdings, Inc, Founders CBO Corporation,
Delaware Capital Management, Inc., Delaware Management Company (a series of
Delaware Management Business Trust), Delaware Investment Advisers (a series of
Delaware Management Business Trust) and Delaware Distributors, L.P.; Executive
Vice President, Chief Operating Officer, Chief Financial Officer and Trustee of
Delaware Management Business Trust; Executive Vice President, Chief Operating
Officer, Chief Financial Officer and Director of Delaware Management Company,
Inc., DMH Corp., Delaware Distributors, Inc., Founders Holdings, Inc. and
Delvoy, Inc.; President, Chief Executive Officer, Chief Financial Officer and
Director of Delaware Service Company, Inc.; President, Chief Operating Officer,
Chief Financial Officer and Director of Delaware International Holdings Ltd.;
Chairman and Director of Delaware Management Trust Company and Retirement
Financial Services, Inc. During the past five years, Mr. Downes has served in
various executive capacities at different times in the Delaware Investments
organization.
- -------------------------------------------------------------
- -------------------------------------------------------------
Richard G. Unruh (59) Executive Vice President of each of the 34 investment
companies in the Delaware Investments family, Delaware Management Holdings,
Inc., Delaware Management Company (a series of Delaware Management Business
Trust) and Delaware Capital Management, Inc.; President of Delaware Investment
Advisers (a series of Delaware Management Business Trust); Executive Vice
President and Director/Trustee of Delaware Management Company, Inc. and Delaware
Management Business Trust; 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 Investments organization.
- -------------------------------------------------------------
- -------------------------------------------------------------
Paul E. Suckow (51) Executive Vice President/Chief Investment Officer, Fixed
Income of each of the 34 other investment companies in the Delaware Investments
family, Delaware Management Company, Inc., Delaware Management Business Trust,
Delaware Management Company (a series of Delaware Management Business Trust),
Delaware Investment Advisers (a series of Delaware Management Business Trust)
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; Director of HYPPCO
Finance Company Ltd. During the past five years, Mr. Suckow has served in
various executive capacities at different times within the Delaware Investments
organization.
- -------------------------------------------------------------
- -------------------------------------------------------------
Richard J. Flannery (41)
- -------------------------------------------------------------
- -------------------------------------------------------------
Michael P. Bishof (36) Senior Vice President/Treasurer of each of the 34
investment companies in the Delaware Investments family and Founders Holdings,
Inc.; Senior Vice President/Investment Accounting of Delaware Management
Company, Inc., Delaware Management Business Trust, Delaware Management Company
(a series of Delaware Management Business Trust) and Delaware Service Company,
Inc.; Senior Vice President and Treasurer/Manager of Investment Accounting of
Delaware Distributors, L.P. and Delaware Investment Advisers (a series of
Delaware Management Business Trust); Senior Vice President and Manager of
Investment Accounting of Delaware International Holdings Ltd.; Senior Vice
President and 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.
- -------------------------------------------------------------
- -------------------------------------------------------------
George M. Chamberlain, Jr. (51) Senior Vice President, Secretary and General
Counsel of each of the 34 investment companies in the Delaware Investments
family; Senior Vice President and Secretary of Delaware Distributors, L.P.,
Delaware Management Company (a series of Delaware Management Business Trust),
Delaware Investment Advisers (a series of Delaware Management Business Trust)
and Delaware Management Holdings, Inc.; Senior Vice President, Secretary and
Director/Trustee of DMH Corp., Delaware Management Company, Inc., Delaware
Distributors, Inc., Delaware Service Company, Inc., Founders Holdings, Inc.,
Delaware Investment & Retirement Services, Inc., Delaware Capital Management,
Inc., Delvoy, Inc. and Delaware Management Business Trust; Executive Vice
President, Secretary and Director of Delaware Management Trust Company.
- -------------------------------------------------------------
- -------------------------------------------------------------
Joseph H. Hastings (48) Senior Vice President/Corporate Controller of each of
the 34 investment companies in the Delaware Investments family and Founders
Holdings, Inc.; Senior Vice President/Corporate Controller and Treasurer of
Delaware Management Holdings, Inc., DMH Corp., Delaware Management Company,
Inc., Delaware Management Business Trust, Delaware Management Company (a series
of Delaware Management Business Trust), Delaware Distributors, L.P., Delaware
Distributors, Inc., Delaware Service Company, Inc., Delaware Capital Management,
Inc., Delaware International Holdings Ltd. and 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. During the past five years, Mr. Hastings
has served in various executive capacities at different times within the
Delaware Investments organization.
- -------------------------------------------------------------
- -------------------------------------------------------------
Patrick P. Coyne (35) Vice President/Senior Portfolio Manager of Delaware
Management Company, Inc., Delaware Management Business Trust, Delaware
Management Company (a series of Delaware Management Business Trust), Delaware
Investment Advisers (a series of Delaware Management Business Trust), Delaware
Capital Management, Inc., and of the fixed-income funds in the Delaware
Investments family. During the past five years, Mr. Coyne has served in various
capacities at different times within the Delaware Investments organization.
- -------------------------------------------------------------
- -------------------------------------------------------------
Mitchell L. Conery (39) Vice President/Senior Portfolio Manager of Delaware
Management Company, Inc., Delaware Management Business Trust, Delaware
Management Company (a series of Delaware Management Business Trust), Delaware
Investment Advisers (a series of Delaware Management Business Trust), and of the
fixed-income funds in the Delaware Investments family. Before joining Delaware
Investments in 1997, Mr. Conery was an investment officer with Travelers
Insurance from 1995 through 1996, and a research analyst with CS First Boston
from 1992 to 1995.
- -------------------------------------------------------------
- -------------------------------------------------------------
Elizabeth H. Howell (36) Vice President/Senior Portfolio Manager of Delaware
Management Company, Inc., Delaware Management Business Trust, Delaware
Management Company (a series of Delaware Management Business Trust), Delaware
Investment Advisers (a series of Delaware Management Business Trust) and of the
fixed-income funds in the Delaware Investments family. Before joining Delaware
Investments in 1997, Ms. Howell was a senior portfolio manager with Voyageur
Fund Managers, Inc.
- -------------------------------------------------------------
- -------------------------------------------------------------
Paul A. Matlack (38) Vice President of Founders Holdings, Inc.; President and
Director of Founders CBO Corporation; Vice President/Senior Portfolio Manager of
Delaware Management Company, Inc., Delaware Management Business Trust, Delaware
Management Company (a series of Delaware Management Business Trust), and an
officer of fixed-income funds in the Delaware Investments family. During the
past five years, Mr. Matlack has served in various capacities at different times
within the Delaware Investments organization.
- -------------------------------------------------------------
- -------------------------------------------------------------
Andrew M. McCullagh (50) Vice President/Senior Portfolio Manager of Delaware
Management Company, Inc., Delaware Management Business Trust, Delaware
Management Company (a series of Delaware Management Business Trust), Delaware
Investment Advisers (a series of Delaware Management Business Trust) and of the
fixed-income funds in the Delaware Investments family. Before joining Delaware
Investments in 1997, Mr. McCullagh was a senior portfolio manager with Voyageur
Asset Management LLC.
- -------------------------------------------------------------
- -------------------------------------------------------------
Gary A. Reed (43) Vice President/Senior Portfolio Manager of Delaware Management
Company, Inc., Delaware Management Business Trust, Delaware Management Company
(a series of Delaware Management Business Trust), Delaware Investment Advisers
(a series of Delaware Management Business Trust), and Delaware Capital
Management, Inc.; and an officer of the fixed-income funds in the Delaware
Investments family. During the past five years, Mr. Reed has served in various
capacities at different times within the Delaware Investments organization.
- -------------------------------------------------------------
- -------------------------------------------------------------
Babak Zenouzi (35) Vice President/Senior Portfolio Manager
of Delaware Management Company, Inc., Delaware Management
Business Trust, Delaware Management Company (a series of
Delaware Management Business Trust), Delaware Investment
Advisers (a series of Delaware Management Business Trust),
and of the equity funds in the Delaware Investments
family. During the past five years, Mr. Zenouzi has served
in various capacities at different times within the
Delaware Investments organization.
- -------------------------------------------------------------
EXHIBIT D
SHAREHOLDINGS BY DIRECTORS AND NOMINEES IN THE
DELAWARE INVESTMENTS FUNDS AS OF JULY 31, 1998
WAYNE A. STORK
Company Shares Percentage of
Owned Fund/Company Owned
Delaware Group Equity Funds
I, Inc.
Devon Fund 65,720.574
Delaware Group Equity Funds
II, Inc.
Decatur Income Fund 1,118.749
Delaware Group Equity Funds
V, Inc.
Small Cap Value Fund 2,862.459
Delaware Group Income
Funds, Inc.
Delchester Fund 601,720.448
Delaware Group Income
Funds, Inc.
High-Yield Opportunities
Fund 1,066,253.089
Delaware Group Government
Fund, Inc. 5,322.055
Delaware Group Cash
Reserve, Inc. 4,783,208.930
Delaware Group Tax-Free
Money Fund, Inc. 1,075.010
Delaware Group State
Tax-Free Income Trust
Tax-Free Pennsylvania
Fund 1,231,454.464
Delaware Group Global &
International Funds,
Inc.
International Equity
Series 11,838.599
Voyageur Mutual Funds III,
Inc.
Aggressive Growth Fund 1,225.190
WALTER P. BABICH
Company Shares Percentage of
Owned Fund/Company Owned
Delaware Group Cash
Reserve, Inc. 10,320.140
Delaware Group Equity Funds
II, Inc.
Decatur Total Return Fund 9,617.726
Delaware Group Equity Funds
V, Inc.
Small Cap Value Fund 4,314.004
Voyageur Mutual Funds III,
Inc.
Aggressive Growth Fund 6,398.292
JOHN H. DURHAM
Company Shares Percentage of
Owned Fund/Company Owned
Delaware Group Cash
Reserve, Inc. 51,781.080
Delaware Pooled Trust,
Inc.
The Real Estate
Investment Trust
Portfolio 1,728.219
ANTHONY D. KNERR
Company Shares Percentage of
Owned Fund/Company Owned
None
ANN R. LEVEN
Company Shares Percentage of
Owned Fund/Company Owned
Delaware Group Equity Funds
I, Inc.
Delaware Fund 746.602
Delaware Group Equity Funds
I, Inc.
Devon Fund 254.522
Delaware Group Equity Funds
II, Inc.
Decatur Income Fund 2,013.376
Delaware Group Equity Funds
II, Inc.
Decatur Total Return Fund 2,029.402
Delaware Group Equity Funds
III, Inc.
Trend Fund 2,143.482
Delaware Group Equity Funds
V, Inc.
Small Cap Value Fund 994.566
Delaware Group Global &
International Funds, Inc.
International Equity
Series 1,173.180
W. THACHER LONGSTRETH
Company Shares Percentage of
Owned Fund/Company Owned
Delaware Group Equity Funds
I, Inc.
Delaware Fund 41,019.337
Delaware Group Equity Funds
II, Inc.
Decatur Income Fund 67,701.871
Delaware Group Equity Funds
II, Inc.
Decatur Total Return Fund 4,110.107
Delaware Group Equity Funds
III, Inc.
Trend Fund 4,417.156
Delaware Group Equity Funds
IV, Inc.
DelCap Fund 1,918.886
Delaware Group Equity Funds
V, Inc.
Small Cap Value Fund 922.787
Delaware Group Income
Funds, Inc.
Delchester Fund 58,474.839
Delaware Group Government
Fund, Inc.
Government Income Series 70.803
Delaware Group Limited-Term
Government Funds, Inc.
U.S. Government Money
Fund 89.170
Delaware Group Limited-Term
Government Funds, Inc.
Limited-Term Government
Fund 27,445.719
Delaware Group Cash
Reserve, Inc. 55,028.110
Delaware Group Tax-Free
Fund, Inc.
Tax-Free USA Fund 40,500.426
Delaware Group State
Tax-Free Income Trust
Tax-Free Pennsylvania
Fund 143.917
Delaware Group Tax-Free
Money Fund, Inc. 4,597.180
THOMAS F. MADISON
Company Shares Percentage of
Owned Fund/Company Owned
Delaware Group Equity Funds
I, Inc.
Devon Fund 246.069
Delaware Group Global &
International Funds, Inc.
International Equity
Fund 159.136
Voyageur Mutual Funds III,
Inc.
Aggressive Growth Fund 132.162
JEFFREY J. NICK
Company Shares Percentage of
Owned Fund/Company Owned
Delaware Group Equity Funds
II, Inc.
Decatur Total Return Fund 922.445
Delaware Group Cash
Reserve, Inc. 5,271.820
CHARLES E. PECK
Company Shares Percentage of
Owned Fund/Company Owned
Delaware Group Equity Funds
I, Inc.
Delaware Fund 16,063.756
Delaware Group Equity Funds
I, Inc.
Devon Fund 15,348.801
Delaware Group Equity Funds
II, Inc.
Decatur Total Return Fund 9,587.880
Delaware Group Equity Funds
III, Inc.
Trend Fund 19,695.625
Delaware Group Equity Funds
IV, Inc.
DelCap Fund 7,583.990
Delaware Group Equity Funds
V, Inc.
Small Cap Value Fund 7,248.518
Delaware Group Adviser
Funds, Inc.
U.S. Growth Fund 17,898.466
Delaware Group Income
Funds, Inc.
Delchester Fund 43,512.233
Delaware Group Limited-Term
Government Funds, Inc.
Limited-Term Government
Fund 16,681.964
Delaware Group Global &
International Funds, Inc.
International Equity
Series 8,678.236
EXHIBIT E
Lists of Current Fundamental Investment Restrictions
Exhibit Table of Contents
Closed-End Funds
Delaware Group Dividend and Income Fund, Inc. E-2
Delaware Group Global Dividend and Income Fund, Inc. E-3
Voyageur Arizona Municipal Income Fund, Inc. E-4
Voyageur Colorado Insured Municipal Income Fund, Inc. E-5
Voyageur Florida Insured Municipal Income Fund E-6
Voyageur Minnesota Municipal Income Fund, Inc. E-5
Voyageur Minnesota Municipal Income Fund II, Inc. E-4
Voyageur Minnesota Municipal Income Fund III, Inc. E-5
Open-End Funds
Voyageur Investment Trust
Delaware-Voyageur Tax Free California Insured Fund E-7
Delaware-Voyageur Tax Free Florida Fund E-8
Delaware-Voyageur Tax Free Florida Insured Fund E-7
Delaware-Voyageur Tax Free Kansas Fund E-7
Delaware-Voyageur Tax Free Missouri Insured Fund E-7
Delaware-Voyageur Tax Free New Mexico Fund E-7
Delaware-Voyageur Tax Free Oregon Insured Fund E-7
Delaware-Voyageur Tax Free Utah Fund E-7
Delaware-Voyageur Tax Free Washington Insured Fund E-7
Delaware Group Dividend and Income Fund, Inc.
Category Current Fundamental Investment Restriction
Diver- The Fund shall not as to 75% of its total assets, invest more than 5%
sifica- of its total assets in securities of any one issuer (except the U.S.
tion Government, its agencies or instrumentalities or repurchase agreements
collateralized by any such obligations) or purchase more than 10% of
the outstanding voting securities of any one issuer.
Concen- The Fund shall not invest 25% or more of its total assets in
tration securities issuers in any one industry; except that there is no
limitation with respect to investment in obligations issued or
guaranteed by the U.S. Government, its agencies or instrumentalities
or repurchase agreements collateralized by any of such obligations.
Borrow- See "Issuing Senior Securities."
ing*
Issuing The Fund shall not issue senior securities, as defined in the
Senior Investment Company Act of 1940, other than preferred stock, not in
Secur- excess of 50% of its total
ities* assets over any senior securities described in clause (b) below that
are outstanding, (b) senior securities other than preferred stock
(including borrowing money) not in excess of 331/3% of its total
assets, and (c) borrowings up to 5% of its total assets for temporary
or defensive purposes without regard to the amount of senior
securities outstanding under clauses (a) and (b) above; provided,
however, that the Fund's obligations under when-issued and delayed
delivery transactions and similar transactions, futures contracts and
options on futures contracts, forward contracts and options on
currencies, indices and securities are not treated as senior
securities if covering assets are appropriately segregated; the Fund
may not pledge its assets other than to secure such issuances of
senior securities or such borrowings or in connection with when-issued
transactions and similar investment strategies; for purposes of
clauses (a), (b), and (c) above, the term "total assets" shall be
calculated after giving effect to the net proceeds of senior
securities issued by the Fund reduced by any liabilities and
indebtedness not constituting senior securities except for such
liabilities and indebtedness as are excluded from treatment as senior
securities by this item.
Short The Fund shall not make short sales of securities or
Sales/ purchase securities on margin except for delayed
Margin* delivery or when-issued transactions or such short-term credits as are
necessary for the clearance of transactions and the writing of options
on securities.
Under- The Fund shall not act as an underwriter of securities of other
writing issuers, except that the Fund may acquire restricted or not readily
marketable securities under circumstances where, if such securities
are sold, the Fund might be deemed to be an underwriter for purposes
of the Securities Act of 1933.
Real The Fund shall not purchase or sell real estate, except securities
Estate secured by real estate or interests
therein.
Commod- The Fund shall not purchase or sell commodities, commodities futures
ities contracts or commodities contracts.
Lending The Fund shall not make loans except through purchasing fixed income
securities, lending portfolio securities and entering into repurchase
agreements consistent with the Fund's investment objectives and
policies.
Illiquid None.
Secur-
ities
Invest- None.
ment
Companies
Control The Fund shall not invest for the purpose of
or exercising control over any issuer.
Management
Options None.
Futures None.
Unseas- None.
oned
Issuers
Warrants None.
Holdings None.
by
Affiliates
Oil or None.
Gas
Miscell- None.
aneous
* These activities will be covered by the proposed standard restriction
concerning Senior Securities and Borrowing.
Delaware Group Global Dividend and Income Fund, Inc.
Category Current Fundamental Investment Restriction
Diversif- The Fund shall not as to 75% of its total assets, invest more than 5%
ication of its total assets in securities of any one issuer (except the U.S.
Government, its agencies or instrumentalities or repurchase
agreements collateralized by any such obligations) or purchase more
than 10% of the outstanding voting securities of any one issuer.
Concen- The Fund shall not invest 25% or more of its total assets in
tration securities issuers in any one industry; except that there is no
limitation with respect to investment in obligations issued or
guaranteed by the U.S. Government, its agencies or instrumentalities
or repurchase agreements collateralized by any of such obligations.
Borrowing* See "Issuing Senior Securities."
Issuing The Fund shall not issue senior securities, as defined in the
Senior Investment Company Act of 1940, (a) other than preferred stock, not
Secur- in excess of 50% of
ities* its total assets over any senior securities described in clause (b)
below that are outstanding, (b) senior securities other than
preferred stock (including borrowing money) not in excess of 331/3%
of its total assets, and (c) borrowings up to 5% of its total assets
for temporary or defensive purposes without regard to the amount of
senior securities outstanding under clauses (a) and (b) above;
provided, however, that the Fund's obligations under when-issued and
delayed delivery transactions and similar transactions, futures
contracts and options on futures contracts, forward contracts and
options on currencies, indices and securities are not treated as
senior securities if covering assets are appropriately segregated;
the Fund may not pledge its assets other than to secure such
issuances of senior securities or such borrowings or in connection
with when-issued transactions and similar investment strategies; for
purposes of clauses (a), (b), and (c) above, the term "total assets"
shall be calculated after giving effect to the net proceeds of senior
securities issued by the Fund reduced by any liabilities and
indebtedness not constituting senior securities except for such
liabilities and indebtedness as are excluded from treatment as senior
securities.
Short The Fund shall not make short sales of securities or
Sales/ purchase securities on margin except for delayed
Margin* delivery or when-issued transactions or such short-term credits as
are necessary for the clearance of transactions and the writing of
options on securities, indices, futures and currencies.
Under- The Fund shall not act as an underwriter of securities of other
writing issuers, except that the Fund may acquire restricted or not readily
marketable securities under circumstances where, if such securities
are sold, the Fund might be deemed to be an underwriter for purposes
of the Securities Act of 1933.
Real The Fund shall not purchase or sell real estate,
Estate except securities secured by real estate or interests
therein.
Commod- The Fund shall not purchase or sell commodities, commodities futures
ities contracts or commodities contracts, except as set forth herein.
Lending The Fund shall not make loans except through purchasing fixed income
securities, lending portfolio securities and entering into repurchase
agreements consistent with the Fund's investment objectives and
policies.
Illiquid None.
Securities
Investment None.
Companies
Control The Fund shall not invest for the purpose of
or exercising control over any issuer.
Management
Options None.
Futures None.
Unseasoned None.
Issuers
Warrants None.
Holdings None.
by
Affiliates
Oil or Gas None.
Miscell- None.
aneous
* These activities will be covered by the proposed standard restriction
concerning Senior Securities and Borrowing.
Voyageur Arizona Municipal Income Fund, Inc.
Voyageur Minnesota Municipal Income Fund II, Inc.
Category Current Fundamental Investment Restriction
Divers- The Fund shall not with respect to 75% of its total assets, invest
ification more than 5% of the value of its total assets (taken at market value
at the time of purchase) in the outstanding securities of any one
issuer or own more than 10% of the outstanding voting securities of
any one issuer, in each case other than securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities
or securities of other investment companies.
Concen- The Fund shall not invest 25% or more of its total assets in
tration securities of issuers in any one industry; provided, however, that
such limitation shall not be applicable to Municipal Obligations other
than those Municipal Obligations backed only by the assets and
revenues of non-governmental users, nor shall it apply to securities
issued or guaranteed by the U.S. Government, its agencies or
instrumentalities.
Borrowing*The Fund shall not borrow money, except from banks for temporary or
emergency purposes or for repurchase of its shares, and then only in
an amount not exceeding one-third of the value of the Fund's total
assets, including the amount borrowed. While any such borrowings
exceed 5% of the Fund's total assets, no purchases of investment
securities will be made.
The Fund shall not pledge, mortgage, hypothecate or otherwise encumber
its assets, except to secure borrowings permitted by "Issuing Senior
Securities" below (collateral arrangements with respect to margin for
futures contracts and options are not deemed to be pledges or other
encumbrances for purposes of this restriction).
Issuing The Fund shall not issue senior securities, as defined in the
Senior Investment Company Act of 1940, other than preferred stock,
Secur- except to the extent such issuance
ities* might be involved with respect to borrowings described under
"Borrowing" above. The Fund's collateral arrangements with respect to
options, futures contracts and options on futures contracts and
collateral requirements with respect to initial and variation margin
are not considered by the Fund's Board of Directors to be the issuance
of a senior security. Similarly, the Fund's obligations under interest
rate swaps, caps and floors, when-issued and forward commitment
transactions and similar transactions are not considered by the Fund's
Board of Directors to be the issuance of a senior security if covering
assets are appropriately segregated.
Short The Fund shall not make short sales of securities.
Sales/
Margin*
Under- The Fund shall not underwrite any issue of securities, except to the
writing extent that in connection with the purchase or disposition of
portfolio securities in accordance with its investment objective,
policies and limitations or the sale of its own shares the Fund may be
deemed to be an underwriter.
Real The Fund shall not purchase or sell real estate, but Estate this shall
Estate not prevent the Fund from investing in
Municipal Obligations secured by real estate or interests therein or
from exercising its rights under agreements relating to such Municipal
Obligations (in which case the Fund may liquidate real estate acquired
as a result of a default on a mortgage.)
Commod- The Fund shall not purchase or sell commodities or commodities
ities contracts, except for hedging purposes.
Lending The Fund shall not make loans of money or property to any person,
except through the purchase of debt obligations in which the Fund may
invest consistently with the Fund's investment objective and policies
or the acquisition of securities subject to repurchase agreements.
Illiquid None.
Secur-
ities
Invest-
ment See "Diversification."
Companies
Control The Fund shall not invest for the purpose of
or exercising control over management of any company.
Management
Options None
Futures None.
Unseas- None.
oned
Issuers
Warrants None.
Holdings None.
by
Affiliates
Oil or None.
Gas
Miscell- None.
aneous
* These activities will be covered by the proposed standard restriction
concerning Senior Securities and Borrowing.
Voyageur Colorado Insured Municipal Income Fund, Inc.
Voyageur Minnesota Municipal Income Fund III, Inc.
Voyageur Minnesota Municipal Income Fund, Inc.
Category Current Fundamental Investment Restriction
Divers- Not Applicable.
ifica-
tion
Concen-
tration The Fund shall not invest 25% or more of its total assets in
securities issuers in any one industry; provided, however, that such
limitation shall not be applicable to Municipal Obligations other than
those Municipal Obligations backed only by the assets and revenues of
non-governmental users, nor shall it apply to securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities.
Borrowing*The Fund shall not borrow money, except from banks for temporary or
emergency purposes or for repurchase of its shares, and then only in
an amount not exceeding one-third of the value of the Fund's total
assets, including the amount borrowed. While any such borrowings
exceed 5% of the Fund's total assets, no purchases of investment
securities will be made.
The Fund shall not pledge, mortgage, hypothecate or otherwise encumber
its assets, except to secure borrowings permitted by the restriction
pertaining to "Borrowing" above (collateral arrangements with respect
to margin for futures contracts and options are not deemed to be
pledges or other encumbrances for purposes of this restriction).
Issuing The Fund shall not issue senior securities, as defined in the
Senior Investment Company Act of 1940, other than preferred stock, except to
Secur- the extent such issuance
ities* might be involved with respect to borrowings described under the
restriction pertaining to "Pledging, Mortgaging, or Hypothecating
Assets." The Fund's collateral arrangements with respect to options,
futures contracts and options on futures contracts and collateral
requirements with respect to initial and variation margin are not
considered by the Fund's Board of Directors to be the issuance of a
senior security. Similarly, the Fund's obligations under interest rate
swaps, caps and floors, when-issued and forward commitment
transactions and similar transactions are not considered by the Fund's
Board of Directors to be the issuance of a senior security if covering
assets are appropriately segregated.
Short The Fund shall not make short sales of securities.
Sales/
Margin*
Under- The Fund shall not underwrite any issue of securities, except to the
writing extent that in connection with the purchase or disposition of
portfolio securities in accordance with its investment objective,
policies and limitations or the sale of its own shares the Fund may be
deemed to be an underwriter.
Real The Fund shall not purchase or sell real estate, but Estate this
Estate shall not prevent the Fund from investing in
Municipal Obligations secured by real estate or interests therein or
from exercising its rights under agreements relating to such Municipal
Obligations (in which case the Fund may liquidate real estate acquired
as a result of a default on a mortgage).
Commod- The Fund shall not purchase or sell commodities or commodities
ities contracts, except for hedging purposes.
Lending The Fund shall not make loans of money or property to any person,
except through the purchase of debt obligations in which the Fund may
invest consistently with the Fund's investment objective and policies
or the acquisition of securities subject to repurchase agreements.
Illiquid None.
Secur-
ities
Invest- None.
ment
Companies
Control The Fund shall not invest for the purpose of
or exercising control over management of any company.
Management
Options None.
Futures None.
Unseas- None.
oned
Issuers
Warrants None.
Holdings None.
by
Affiliates
Oil or None.
Gas
Miscell- None.
aneous
* These activities will be covered by the proposed standard restriction
concerning Senior Securities and Borrowing.
Voyageur Florida Insured Municipal Income Fund
Category Current Fundamental Investment Restriction
Divers- The Fund shall not with respect to 75% of its total assets, invest
ifica- more than 5% of the value of its total assets (taken at market value
tion at the time of purchase) in the outstanding securities of any one
issuer or own more than 10% of the outstanding voting securities of
any one issuer, in each case other than securities issued or
guaranteed by the U.S. Government, its agencies or instrumentalities
or securities of other investment companies.
Concen- The Fund shall not invest 25% or more of its total assets in
tration securities of issuers in any one industry; provided, however, that
such limitation shall not be applicable to Municipal Obligations other
than those Municipal Obligations backed only by the assets and
revenues of non-governmental users, nor shall it apply to securities
issued or guaranteed by the U.S. Government, its agencies or
instrumentalities.
Borrowing*The Fund shall not borrow money, except from banks for temporary or
emergency purposes or for repurchase of its shares, and then only in
an amount not exceeding one-third of the value of the Fund's total
assets, including the amount borrowed. While any such borrowings
exceed 5% of the Fund's total assets, no purchases of investment
securities will be made.
The Fund shall not pledge, mortgage, hypothecate or otherwise encumber
its assets, except to secure borrowings permitted by "Issuing Senior
Securities" below (collateral arrangements with respect to margin for
futures contracts and options are not deemed to be pledges or other
encumbrances for purposes of this restriction).
Issuing The Fund shall not issue senior securities, as defined in the
Senior Investment Company Act of 1940, other than Securitiespreferred stock,
Secur- except to the extent such issuance
ities* might be involved with respect to borrowings described under
"Borrowing" above. The Fund's collateral arrangements with respect to
options, futures contracts and options on futures contracts and
collateral requirements with respect to initial and variation margin
are not considered by the Fund's Board of Directors to be the issuance
of a senior security. Similarly, the Fund's obligations under interest
rate swaps, caps and floors, when-issued and forward commitment
transactions and similar transactions are not considered by the Fund's
Board of Directors to be the issuance of a senior security if covering
assets are appropriately segregated.
Short The Fund shall not make short sales of securities.
Sales/
Margin*
Under-
writing The Fund shall not underwrite any issue of securities, except to the
extent that in connection with the purchase or disposition of
portfolio securities in accordance with its investment objective,
policies and limitations or the sale of its own shares the Fund may be
deemed to be an underwriter.
Real The Fund shall not purchase or sell real estate, but this shall not
Estate prevent the Fund from investing in
Municipal Obligations secured by real estate or interests therein or
from exercising its rights under agreements relating to such Municipal
Obligations (in which case the Fund may liquidate real estate acquired
as a result of a default on a mortgage.)
Commod- The Fund shall not purchase or sell commodities or commodities
ities contracts, except for hedging purposes.
Lending The Fund shall not make loans of money or property to any person,
except through the purchase of debt obligations in which the Fund may
invest consistently with the Fund's investment objective and policies
or the acquisition of securities subject to repurchase agreements.
Illiquid None.
Securities
Invest- See "Diversification."
ment
Companies
Control The Fund shall not invest for the purpose of
or exercising control over management of any company.
Management
Options None
Futures None.
Unseas- None.
oned
Issuers
Warrants None.
Holdings None.
by
Affiliates
Oil or None.
Gas
Miscell- None.
aneous.
* These activities will be covered by the proposed standard restriction
concerning Senior Securities and Borrowing.
Delaware-Voyageur Tax-Free California Insured Fund Delaware-Voyageur Tax-Free
Florida Insured Fund Delaware-Voyageur Tax-Free Kansas Fund Delaware-Voyageur
Tax-Free Missouri Insured Fund Delaware-Voyageur Tax-Free New Mexico Fund
Delaware-Voyageur Tax-Free Oregon Insured Fund Delaware-Voyageur Tax-Free Utah
Fund Delaware-Voyageur Tax-Free Washington Insured Fund
Category Current Fundamental Investment Restriction
Divers- None.
ifica-
tion
Concen- The Fund shall not invest 25% or more of its assets in
tration the securities of issuers in any single industry, except that the Fund
may invest without limitation, in circumstances in which other
appropriate available investments may be in limited supply, in
housing, health care and utility obligations; provided that there
shall be no limitation on the purchase of Tax Exempt Obligations and,
for defensive purposes, obligations issued or guaranteed by the U.S.
government, its agencies or instrumentalities. (Note: For purposes of
this investment restriction, the Fund's investment adviser (the
"Manager") interprets "Tax Exempt Obligations" to exclude limited
obligation bonds payable only from revenues derived from facilities or
projects within a single industry.)
Borrowing*The Fund shall not borrow money, except from banks for temporary or
emergency purposes in an amount not exceeding 20% of the value of the
Fund's total assets, including the amount borrowed. The Fund may not
borrow for leverage purposes, and securities will not be purchased
while borrowings are outstanding. Interest paid on any money borrowed
will reduce the Fund's net income. The Fund shall not pledge,
hypothecate, mortgage or otherwise encumber its assets in excess of
10% of its total assets (taken at the lower of cost or current value)
and then only to secure borrowings permitted by the restriction
described in the preceding paragraph).
Issuing None.
Senior
Securities*
Short The Fund shall not purchase securities on margin,
Sales/ except such short-term credits as may be necessary for
Margin* the clearance of purchases and sales of securities. The Fund shall not
make short sales of securities or maintain a short position for the
account of such Fund unless at all times when a short position is open
it owns an equal amount of such securities or owns securities which,
without payment of any further consideration, are convertible into or
exchangeable for securities of the same issue as, and equal in amount
to, the securities sold short.
Under- The Fund shall not underwrite securities issued by other persons
writing except to the extent that, in connection with the disposition of its
portfolio investments, it may be deemed to be an underwriter under
federal securities laws.
Real The Fund shall not purchase or sell real estate,
Estate although it may purchase securities which are secured
by or represent interests in real estate.
Commod- The Fund shall not purchase or sell commodities or commodity contracts
ities (including futures contracts).
Lending The Fund shall not make loans, except by purchase of debt obligations
in which the Fund may invest consistent with its investment policies,
and through repurchase agreements.
Illiquid The Fund shall not invest more than 15% of its net assets in illiquid
Secur- investments.
ities
Invest- None.
ment
Companies
Control None.
or
Management
Options None.
Futures See "Commodities."
Unseas- None.
oned
Issuers
Warrants None.
Holdings The Fund shall not invest in securities of any issuer
by if, to the knowledge of the Fund, officers and
Affil- directors or trustees [as applicable] of the Fund or
iates officers and directors of the Fund's investment adviser who
beneficially own more than 1/2 of 1% of the securities of that issuer
together own more than 5% of such securities.
Oil or None.
Gas
Miscell- None.
aneous
* These activities will be covered by the proposed standard restriction
concerning Senior Securities and Borrowing.
Delaware-Voyageur Tax-Free Florida Fund
Category Current Fundamental Investment Restriction
Divers- None.
ifica-
tion
Concen- The Fund shall not invest 25% or more of its assets in the securities
tration of issuers in any single industry (except that it may invest without
limitation, in circumstances in which other appropriate available
investments may be in limited supply, in housing, health care,
utility, transportation, education and/or industrial obligations);
provided that there shall be no limitation on the purchase of Tax
Exempt Obligations and, for defensive purposes, obligations issued or
guaranteed by the U.S. government, its agencies or instrumentalities.
(Note: For purposes of this investment restriction, the Manager
interprets "Tax Exempt Obligations" to exclude limited obligations
bonds payable only from revenues derived from facilities or projects
within a single industry.)
Borrowing*The Fund shall not borrow money (provided that the Fund may enter into
reverse repurchase agreements), except from banks for temporary or
emergency purposes in an amount not exceeding 20% of the value of the
Fund's total assets, including the amount borrowed. The Fund may not
borrow for leverage purposes, provided that the Fund may enter into
reverse repurchase agreements for such purposes, and securities will
not be purchased while outstanding borrowings exceed 5% of the value
of the Fund's total assets.
Issuing The Fund shall not issue any senior securities (as defined in the
Senior Investment Company Act of 1940), except Securitiesas set forth in the
Secur- investment restriction pertaining
ities* to "Borrowing, and except to the extent that using options, futures
contracts and options on futures contracts, purchasing or selling on a
when-issued or forward commitment basis or using similar investment
strategies may be deemed to constitute issuing a senior security.
Short None.
Sales/
Margin*
Under- The Fund shall not underwrite securities issued by other persons
writing except to the extent that, in connection with the disposition of
portfolio investments, the Fund may be deemed to be an underwriter
under federal securities laws.
Real The Fund shall not purchase or sell real estate,
Estate although it may purchase securities which are secured
by or represent interests in real estate.
Commod- The Fund shall not purchase or sell commodities or futures or options
ities contracts with respect to physical commodities. This restriction shall
not restrict the Fund from purchasing or selling, on a basis
consistent with any restrictions contained in its then-current
prospectus, any financial contracts or instruments which may be deemed
commodities (including, by way of example and not by way of
limitation, options, futures, and options on futures with respect, in
each case, to interest rates, currencies, stock indices, bond indices
or interest rate indices).
Lending The Fund shall not make loans, except by purchase of debt obligations
in which the Fund may invest consistent with its investment policies,
and through repurchase agreements.
Illiquid None.
Securities
Invest- None.
Companies
Control None.
or
Management
Options See "Commodities."
Futures See "Commodities."
Unseas- None.
oned
Issuers
Warrants None.
Holdings None.
by
Affiliates
Oil or None.
Gas
Miscell- None.
aneous
* These activities will be covered by the proposed standard restriction
concerning Senior Securities and Borrowing.
EXHIBIT F
INFORMATION RELATING TO INVESTMENT MANAGEMENT AND SUB-ADVISORY AGREEMENTS
- ---------------------------------------------------------------------------------------------
Fund Investment Date Asset Date Current Proposed Management Management Percentage Servic-
Manager of Size and Management Management Fees Fees Differ- ing
or Agreement as Reason (or (or Due that ence Distri-
Sub-Adviser of Agreement Sub-Advisory) Sub-Advisory) and/or Would Between bution
6/30/98 Last Fee Rate Fee Rate Waived Have A & B Fees
Submitted Based On Based on Last Been Paid
to Average Average Daily Fiscal Paid Last
Shareholders Daily Net Net Assets Year: and/or Fiscal
for Assets A Waived Year to
Approval During Affil-
the Last iates
Fiscal of
Year Manager
Under
Proposed
Management
Fee
Rate:
B
- ---------------------------------------------------------------------------------------------
Delaware
Group DMC 4/3/95 3/29/95 0.55% per No Change N/A N/A
Dividend Change
and of year
Income Control
Fund, Inc. of DMC
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware
Group DMC 4/3/95 3/29/95 0.70% per No Change N/A N/A
Global year
Dividend Change
and of
Income Control
Fund, of DMC
Inc.
(Investment
Management)
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware
Group DIAL 4/3/95 3/29/95 O.40% of No Change N/A N/A
Global management
Dividend Change fees paid
and of to DMC
Income Control
Fund, of
Inc. DIAL
(Sub-Advisory)
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Voyageur
Arizona DMC 4/30/97 5/1/97 0.40% per No Change N/A N/A
Municipal year
Income Change
Fund, Inc. of
Control
of VFM
- ---------------------------------------------------------------------------------------------
Voyageur
Colorado DMC 4/30/97 5/1/97 0.40% per No Change N/A N/A
Insured year
Municipal Change
Income of
Fund, Inc. Control
of VFM
- ---------------------------------------------------------------------------------------------
Voyageur
Florida DMC 4/30/97 5/1/97 0.40% per No Change N/A N/A
Insured year
Municipal Change
Income of
Fund Control
of VFM
- ---------------------------------------------------------------------------------------------
Voyageur
Minnesota DMC 4/30/97 0.40% per No Change N/A N/A
Municipal year
Income
Fund, Inc.
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Voyageur
Minnesota DMC 4/30/97 5/1/97 0.40% per No Change N/A N/A
Municipal year
Income Change
Fund II, of
Inc. Control
of VFM
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Voyageur
Minnesota DMC 4/30/97 5/1/97 0.40% per No Change N/A N/A
Municipal year
Income Change
Fund III, of
Inc. Control
of VFM
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Voyageur
Investment
Trust
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware-
Voyageur
Tax-Free DMC 4/30/97 5/1/97 0.50% per 0.50% on $174,89 N/A N/A $162,007
California year first $500 due
Insured Change million $9,546
Fund of 0.475% on waived
Control next $500
of VFM million
0.45% on next
$1,500 million
0.425% on
assets in
excess of
$2,500
million;
all per year
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware-
Voyageur
Tax-Free DMC 4/30/97 5/1/97 0.50% per 0.55% on $39,94 $44,160 11% $42,365
Florida year first $500 due due
Fund Change million
of 0.50% on next All
Control $500 million waived
of VFM 0.45% on next
$1,500 million
0.425% on
assets in
excess of
$2,500
million; all
per year
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware-
Voyageur
Tax-Free DMC 4/30/97 5/1/97 0.50% per 0.50% on $876,74 N/A N/A $376,439
Florida year first $500 due
Insured Change million
Fund of 0.475% on $109,770
Control next $500 waived
of VFM million
0.45% on next
$1,500 million
0.425% on
assets in
excess of
$2,500 million;
all per year
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware-
Voyageur
Tax-Free DMC 4/30/97 5/1/97 0.50% per 0.55% on $66,097 $72,892 10% $65,085
Kansas year first $500 due
Fund Change million
of 0.50% on next $25,097
Control $500 million waived
of VFM 0.45% on next
$1,500 million
0.425% on
assets in
excess of
$2,500
million; all
per year
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware-
Voyageur
Tax-Free DMC 4/30/97 5/1/97 0.50% per 0.50% on $298,15 N/A N/A $238,186
Missouri year first $500 due
Insured Change million
Fund of 0.475% on $14,788
Control next $500 waived
of VFM million
0.45% on next
$1,500 million
0.425% on
assets in
excess of
$2,500 million;
all per year
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware-
Voyageur
Tax-Free DMC 4/30/97 5/1/97 0.50% per 0.55% on $102,89 $113,259 10% $62,361
New year first $500 due
Mexico Change million
Fund of 0.50% on next $9,442
Control $500 million waived
of VFM 0.45% on next
$1,500 million
0.425% on
assets in
excess of
$2,500
million; all
per year
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware-
Voyageur
Tax-Free DMC 4/30/97 5/1/97 0.50% per 0.50% on $135,06 N/A N/A $123,531
Oregon year first $500 due
Insured Change million
Fund of 0.475% on $61,673
Control next $500 waived
of VFM million
0.45% on next
$1,500 million
0.425% on
assets in
excess of
$2,500
million; all
per year
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware-
Voyageur
Tax-Free DMC 4/30/97 5/1/97 0.50% per 0.55% on $19,497 $21,486 10% $43,624
Utah Fund year first $500 due
Change million
of 0.50% on next All
Control $500 million waived
of VFM 0.45% on next
$1,500 million
0.425% on
assets in
excess of
$2,500
million; all
per year
- ---------------------------------------------------------------------------------------------
- ---------------------------------------------------------------------------------------------
Delaware-
Voyageur
Tax-Free DMC 4/30/97 5/1/97 0.50% per 0.50% on $15,461 N/A N/A $18,603
Washington year first $500 due
Insured Change million
Fund of 0.475% on All
Control next $500 waived
of VFM million
0.45% on next
$1,500 million
0.425% on
assets in
excess of
$2,500 million;
all per year
- ---------------------------------------------------------------------------------------------
EXHIBIT G
Actual And Hypothetical Expense Tables
Delaware-Voyageur Tax-Free Florida Fund
Class A Shares Class B & C Shares
Actual Proposed Actual Proposed
Mgmt. Fees 0.50% 0.55% 0.50% 0.55%
12b-1 Fees 0.25% 0.25% 1.00% 1.00%
Other Expenses 0.31% 0.31% 0.31% 0.31%
- -------------- ----- ----- ----- -----
Total Expenses 1.08% 1.13% 1.83% 1.88%
Total After 0.56% UNK** 1.31% UNK**
Waiver*
Delaware-Voyageur Tax-Free Kansas Fund
Class A Shares Class B & C Shares
Actual Proposed Actual Proposed
Mgmt. Fees 0.50% 0.55% 0.50% 0.55%
12b-1 Fees 0.25% 0.25% 1.00% 1.00%
Other Expenses 0.29% 0.29% 0.29% 0.29%
- -------------- ----- ----- ----- -----
Total Expenses 1.04% 1.09% 10.79% 1.84%
Total After 1.00% UNK** 10.75% UNK**
Waiver*
Delaware-Voyageur Tax-Free New Mexico Fund
Class A Shares Class B & C Shares
Actual Proposed Actual Proposed
Mgmt. Fees 0.50% 0.55% 0.50% 0.55%
12b-1 Fees 0.25% 0.25% 1.00% 1.00%
Other Expenses 0.42% 0.42% 0.42% 0.42%
- -------------- ----- ----- ----- -----
Total Expenses 1.17% 1.22% 1.92% 1.97%
Total After 1.00% UNK** 10.75% UNK**
Waiver*
Delaware-Voyageur Tax-Free Utah Fund
Class A Shares Class B & C Shares
Actual Proposed Actual Proposed
Mgmt. Fees 0.50% 0.55% 0.50% 0.55%
12b-1 Fees 0.25% 0.25% 1.00% 1.00%
Other Expenses 0.40% 0.40% 0.40% 0.40%
- -------------- ----- ----- ----- -----
Total Expenses 1.15% 1.20% 1.90% 1.95%
Total After 0.85% UNK** 10.60% UNK**
Waiver*
* DMC voluntarily waived its management fee during the past fiscal year [and
expects to waive the management fee in the current fiscal year]. DMC may end
the waiver at any time. With the waiver, Total Operating Expenses for A Class
shares were 0.56% during the last fiscal year.
**Hypothetical expense figures after waivers are not shown along with the
proposed fee rates, because fee waivers have not been determined for future
years.
EXHIBIT H
Similar Funds Managed by DMC or DIAL
Single State Tax-Free Funds
- ------------------------------------------------------------------
Investment Asset Current Proposed Management
Fund Manager Size Management (or Sub-Advisory)
or as (or Fee Rate Based on
Sub-Advi- of Sub-Advisory) Average Daily Net
ser 6/30/98 Fee Assets
Rate
Based
On
Average
Daily
Net
Assets
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.55% on first $500
Tax-Free Arizona Fund per year million
0.50% on next $500
million 0.45% on
next $1,500 million
0.425% on assets
in excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.50% on first $500
Tax-Free Arizona per year million
Insured Fund 0.475% on next $500
million
0.45% on next $1,500
million
0.425% on assets in
excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.55% on first $500
Tax-Free California per year million
Fund 0.50% on next $500
million
0.45% on next $1,500
million
0.425% on assets in
excess of $2,500
million; all per year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.55% on first $500
Tax-Free Colorado Fund per year million
0.50% on next $500
million 0.45% on
next $1,500 million
0.425% on assets
in excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.55% on first $500
Tax-Free Idaho Fund per year million
0.50% on next $500
million 0.45% on
next $1,500 million
0.425% on assets
in excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.55% on first $500
Tax-Free Iowa Fund per year million
0.50% on next $500
million 0.45% on
next $1,500 million
0.425% on assets
in excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.55% on first $500
Tax-Free Minnesota per year million
Fund 0.50% on next $500
million
0.45% on next $1,500
million
0.425% on assets in
` excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.50% on first $500
Minnesota Insured Fund per year million
0.475% on next $500
million 0.45% on
next $1,500 million
0.425% on assets
in excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.40% 0.50% on first $500
Tax-Free Minnesota per year million
Intermediate Fund 0.475% on next $500
million
0.45% on next $1,500
million
0.425% on assets in
excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.65% 0.55% on first $500
Minnesota High Yield per year million
Municipal Bond Fund 0.50% on next $500
million
0.45% on next $1,500
million
0.425% on assets in
excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Tax-Free New Jersey DMC 0.55% 0.55% on first $500
Fund on million
first 0.50% on next $500
$500 million
million 0.45% on next $1,500
0.525% million
on next 0.425% on assets in
$500 excess of $2,500
million million; all per
0.50% year
on
assets
in
excess
of
$1,000
million;
all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.55% on first $500
Tax-Free New York Fund per year million
0.50% on next $500
million 0.45% on
next $1,500 million
0.425% on assets
in excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.55% on first $500
Tax-Free North Dakota per year million
Fund 0.50% on next $500
million
0.45% on next $1,500
million
0.425% on assets in
excess of $2,500
million; all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Tax-Free Ohio Fund DMC 0.55% 0.55% on first $500
on million
first 0.50% on next $500
$500 million
million 0.45% on next $1,500
0.525% million
on next 0.425% on assets in
$500 excess of $2,500
million million; all per
0.50% year
on
assets
in
excess
of
$1,000
million
all per
year
- ------------------------------------------------------------------
- ------------------------------------------------------------------
Tax-Free Pennsylvania DMC 0.60% 0.55% on first $500
Fund on million
first 0.50% on next $500
$500 million
million 0.45% on next
0.575% $1,500 million
on next 0.425% on assets in
$250 excess of $2,500
million million; all per
0.55% year
on
assets
in
excess
of $750
million;
all per
year
- ------------------------------------------------------------------
Delaware-Voyageur DMC 0.50% 0.55% on first $500
Tax-Free Wisconsin per year million
Fund 0.50% on next $500
million
0.45% on next $1,500
million
0.425% on assets in
excess of $2,500
million; all per
year
- ------------------------------------------------------------------
Other Similar Funds Managed by DMC
- ------------------------------------------------------------------
Investment Asset Current Proposed Management
Fund Manager Size Management (or Sub-Advisory)
or as (or Fee Rate Based on
Sub-Advi- of Sub-Advisory) Average Daily Net
ser 6/30/98 Fee Assets
Rate
Based
On
Average
Daily
Net
Assets
- ------------------------------------------------------------------
Delaware-Group Equity DMC 0.65% 0.65% on first $500
Funds, II, Inc. on million
Retirement Income first 0.60% on next $500
Fund (similar to $500 million
Delaware Group million 0.55% on next $1,500
Dividend and Income million
Fund, Inc.) 0.625% 0.50% on assets over
on next $2.5 billion
$500
million
0.60%
on
assets
over $1
billion
- ------------------------------------------------------------------
EXHIBIT I
Form of Investment Management Agreement
AGREEMENT, made by and between [REGISTRANT], a [ ] corporation ("Fund")
on behalf of the [SERIES] ("Series"), and DELAWARE MANAGEMENT COMPANY, a series
of Delaware Management Business Trust, a Delaware business trust ("Investment
Manager").
W I T N E S S E T H:
WHEREAS, the Fund has been organized and operates as an investment
company registered under the Investment Company Act of 1940 and is currently
comprised of [x] series, including the Series; as a separate series of the Fund,
each series engages in the business of investing and reinvesting its assets in
securities, and
WHEREAS, the Investment Manager is a registered investment adviser
under the Investment Advisers Act of 1940 and engages in the business of
providing investment management services; and
WHEREAS, the Fund on behalf of the Series and the Investment Manager
desire to enter into this Agreement.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and each of the parties hereto intending to be legally bound, it is
agreed as follows:
1. The Fund hereby employs the Investment Manager to manage the
investment and reinvestment of the Series' assets and to administer its affairs,
subject to the direction of the Fund's Board of Directors and officers of the
Fund for the period and on the terms hereinafter set forth. The Investment
Manager hereby accepts such employment and agrees during such period to render
the services and assume the obligations herein set forth for the compensation
herein provided. The Investment Manager shall for all purposes herein be deemed
to be an independent contractor, and shall, unless otherwise expressly provided
and authorized, have no authority to act for or represent the Fund in any way,
or in any way be deemed an agent of the Fund. The Investment Manager shall
regularly make decisions as to what securities and other instruments to purchase
and sell on behalf of the Series and shall effect the purchase and sale of such
investments in furtherance of the Series' objectives and policies and shall
furnish the Board of Directors of the Fund with such information and reports
regarding the Series' investments as the Investment Manager deems appropriate or
as the Directors of the Fund may reasonably request.
2. The Fund shall conduct its own business and affairs and shall bear
the expenses and salaries necessary and incidental thereto including, but not in
limitation of the foregoing, the costs incurred in: the maintenance of its
corporate existence; the maintenance of its own books, records and procedures;
dealing with its own shareholders; the payment of dividends; transfer of stock,
including issuance, redemption and repurchase of shares; preparation of share
certificates; reports and notices to shareholders; calling and holding of
shareholders' meetings; miscellaneous office expenses; brokerage commissions;
custodian fees; legal and accounting fees; taxes; and federal and state
registration fees. Directors, officers and employees of the Investment Manager
may be directors, officers and employees of any of the investment companies
within the Delaware Investments family (including the Fund). Directors, officers
and employees of the Investment Manager who are directors, officers and/or
employees of these investment companies shall not receive any compensation from
such companies for acting in such dual capacity.
In the conduct of the respective businesses of the parties hereto and
in the performance of this Agreement, the Fund and Investment Manager may share
facilities common to each, which may include legal and accounting personnel,
with appropriate proration of expenses between them.
3. (a) Subject to the primary objective of obtaining the best available
prices and execution, the Investment Manager will place orders for the purchase
and sale of portfolio securities and other instruments with such broker/dealers
selected who provide statistical, factual and financial information and services
to the Fund, to the Investment Manager, to any Sub-Adviser, as defined in
Paragraph 5 hereof, or to any other fund for which the Investment Manager or any
such Sub-Adviser provides investment advisory services and/or with
broker/dealers who sell shares of the Fund or who sell shares of any other fund
for which the Investment Manager or any such Sub-Adviser provides investment
advisory services. Broker/dealers who sell shares of the funds of which Delaware
Management Company is investment manager, shall only receive orders for the
purchase or sale of portfolio securities to the extent that the placing of such
orders is in compliance with the Rules of the Securities and Exchange Commission
and the National Association of Securities Dealers, Inc.
(b) Notwithstanding the provisions of subparagraph (a) above and
subject to such policies and procedures as may be adopted by the Board of
Directors and officers of the Fund, the Investment Manager may ask the Fund and
the Fund may agree to pay a member of an exchange, broker or dealer an amount of
commission for effecting a securities transaction in excess of the amount of
commission another member of an exchange, broker or dealer would have charged
for effecting that transaction, in such instances where the Fund and the
Investment Manager have determined in good faith that such amount of commission
was reasonable in relation to the value of the brokerage and research services
provided by such member, broker or dealer, viewed in terms of either that
particular transaction or the Investment Manager's overall responsibilities with
respect to the Fund and to other funds and other advisory accounts for which the
Investment Manager or any Sub-Adviser, as defined in Paragraph 5 hereof,
exercises investment discretion.
4. As compensation for the services to be rendered to the Fund by the
Investment Manager under the provisions of this Agreement, the Fund shall pay to
the Investment Manager monthly from the Series' assets, a fee based on the
average daily net assets of the Series during the month. Such fee shall be
calculated in accordance with the following schedule:
Monthly Annual Rate Average Daily Net Assets
If this Agreement is terminated prior to the end of any calendar month,
the management fee shall be prorated for the portion of any month in which this
Agreement is in effect according to the proportion which the number of calendar
days, during which the Agreement is in effect, bears to the number of calendar
days in the month, and shall be payable within 10 days after the date of
termination.
5. The Investment Manager may, at its expense, select and contract with
one or more investment advisers registered under the Investment Advisers Act of
1940 ("Sub-Advisers") to perform some or all of the services for the Series for
which it is responsible under this Agreement. The Investment Manager will
compensate any Sub-Adviser for its services to the Series. The Investment
Manager may terminate the services of any Sub-Adviser at any time in its sole
discretion, and shall at such time assume the responsibilities of such
Sub-Adviser unless and until a successor Sub-Adviser is selected and the
requisite approval of the Series' shareholders is obtained. The Investment
Manager will continue to have responsibility for all advisory services furnished
by any Sub-Adviser.
6. The services to be rendered by the Investment Manager to the Fund
under the provisions of this Agreement are not to be deemed to be exclusive, and
the Investment Manager shall be free to render similar or different services to
others so long as its ability to render the services provided for in this
Agreement shall not be impaired thereby.
7. The Investment Manager, its directors, officers, employees, agents
and shareholders may engage in other businesses, may render investment advisory
services to other investment companies, or to any other corporation,
association, firm or individual, and may render underwriting services to the
Fund or to any other investment company, corporation, association, firm or
individual.
8. The Investment Manager has a claim to the rights to the use of the
identifying names "Delaware," "Delaware Investments," or "Delaware Group" in
connection with Funds, whether already existing or created in the future (or
their series or classes), which the Investment Manager or its affiliates sponsor
or distribute. The Investment Manager hereby consents to the Fund's use of the
identifying words "Delaware," "Delaware Investments," or "Delaware Group," in
the name of the Fund, or any series or class of shares of the Fund. In the event
that the Investment Manager ceases to be the Fund's investment manager, or
otherwise determines that the Fund should no longer utilize such names for any
reason, the Investment Manager may revoke its consent in writing and the Fund
will promptly cease using such names for the Fund, its series or classes, and
will take all necessary steps to amend the Fund's Articles of Incorporation and
Bylaws to reflect a name change.
9. In the absence of willful misfeasance, bad faith, gross negligence,
or a reckless disregard of the performance of its duties as the Investment
Manager to the Fund, the Investment Manager shall not be subject to liability to
the Fund or to any shareholder of the Fund for any action or omission in the
course of, or connected with, rendering services hereunder or for any losses
that may be sustained in the purchase, holding or sale of any security, or
otherwise.
10. This Agreement shall be executed and become effective as of the
date written below if approved by the vote of a majority of the outstanding
voting securities of the Series. It shall continue in effect for a period of two
years and may be renewed thereafter only so long as such renewal and continuance
is specifically approved at least annually by the Board of Directors or by the
vote of a majority of the outstanding voting securities of the Series and only
if the terms and the renewal hereof have been approved by the vote of a majority
of the Directors of the Fund who are not parties hereto or interested persons of
any such party, cast in person at a meeting called for the purpose of voting on
such approval. Notwithstanding the foregoing, this Agreement may be terminated
by the Fund at any time, without the payment of a penalty, on sixty days'
written notice to the Investment Manager of the Fund's intention to do so,
pursuant to action by the Board of Directors of the Fund or pursuant to the vote
of a majority of the outstanding voting securities of the Series. The Investment
Manager may terminate this Agreement at any time, without the payment of a
penalty, on sixty days' written notice to the Fund of its intention to do so.
Upon termination of this Agreement, the obligations of all the parties hereunder
shall cease and terminate as of the date of such termination, except for any
obligation to respond for a breach of this Agreement committed prior to such
termination, and except for the obligation of the Fund to pay to the Investment
Manager the fee provided in Paragraph 4 hereof, prorated to the date of
termination. This Agreement shall automatically terminate in the event of its
assignment.
11. This Agreement shall extend to and bind the heirs, executors,
administrators and successors of the parties hereto.
12. For the purposes of this Agreement, the terms "vote of a majority
of the outstanding voting securities"; "interested persons"; and "assignment"
shall have the meaning defined in the Investment Company Act of 1940.
IN WITNESS WHEREOF, the parties hereto have caused their corporate
seals to be affixed and duly attested and their presents to be signed by their
duly authorized officers as of the ____ day of __________, 19__.
[REGISTRANT NAME].
for the [SERIES NAME]
By:
Name:
Title:
Attest:
Name:
Title:
DELAWARE MANAGEMENT COMPANY, a
series of DELAWARE MANAGEMENT BUSINESS TRUST
By:
Name:
Title:
Attest:
Name:
Title:
EXHIBIT J
Form of Sub-Advisory Agreement
AGREEMENT, made by and between DELAWARE MANAGEMENT COMPANY, a series of
Delaware Management Business Trust, a Delaware business trust ("Investment
Manager"), and [SUB-ADVISER NAME] ("Sub-Adviser").
W I T N E S S E T H:
WHEREAS, [REGISTRANT NAME], a Maryland corporation ("Fund"), has been
organized and operates as an investment company registered under the Investment
Company Act of 1940 and engages in the business of investing and reinvesting its
assets in securities, and
WHEREAS, the Investment Manager and the Fund on behalf of the [Series]
("Series") have entered into an agreement of even date herewith ("Investment
Management Agreement") whereby the Investment Manager will provide investment
advisory services to the Fund on behalf of the Series; and
WHEREAS, the Investment Management Agreement permits the Investment
Manager to hire one or more sub-advisers to assist the Investment Manager in
providing investment advisory services to the Fund on behalf of the Series; and
WHEREAS, the Investment Manager and the Sub-Adviser are registered
Investment Advisers under the Investment Advisers Act of 1940 and engage in the
business of providing investment management services.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, and each of the parties hereto intending to be legally bound, it is
agreed as follows:
1. The Investment Manager hereby employs the Sub-Adviser to furnish the
Investment Manager with investment recommendations, asset allocation advice,
research, economic analysis and other investment services with respect to
securities in which the Series may invest, subject to the direction of the Board
and officers of the Fund for the period and on the terms hereinafter set forth.
The Sub-Adviser hereby accepts such employment and agrees during such period to
render the services and assume the obligations herein set forth for the
compensation herein provided. The Sub-Adviser shall for all purposes herein be
deemed to be an independent contractor, and shall, unless otherwise expressly
provided and authorized, have no authority to act for or represent the Fund in
any way, or in any way be deemed an agent of the Fund. The Sub-Adviser shall
furnish the Board of Directors of the Fund with such information and reports
regarding its activities as the Investment Manager deems appropriate or as the
Directors of the Fund may reasonably request consistent with the provisions of
Section 15(c) of the Investment Company Act of 1940.
2. Under the terms of the Investment Management Agreement, the Fund
shall conduct its own business and affairs and shall bear the expenses and
salaries necessary and incidental thereto including, but not in limitation of
the foregoing, the costs incurred in: the maintenance of its corporate
existence; the maintenance of its own books, records and procedures; dealing
with its own shareholders; the payment of dividends; transfer of stock,
including issuance and repurchase of shares; preparation of share certificates;
reports and notices to shareholders; calling and holding of shareholders'
meetings; miscellaneous office expenses; brokerage commissions; custodian fees;
legal and accounting fees; taxes; and federal and state registration fees.
Without limiting the foregoing, except as the Investment Manager and the
Sub-Adviser may agree in writing from time to time, the Sub-Adviser shall have
no responsibility for record maintenance and preservation obligations under
Section 31 of the Investment Company Act of 1940. Directors, officers and
employees of the Sub-Adviser may be directors, officers and employees of other
funds which have employed the Sub-Adviser as sub-adviser or investment manager.
In the conduct of the respective business of the parties hereto and in
the performance of this Agreement, the Fund, the Investment Manager and the
Sub-Adviser may share facilities common to each, with appropriate proration of
expenses between and among them.
3. As compensation for the services to be rendered to the Fund for the
benefit of the Series by the Sub-Adviser under the provisions of this Agreement,
the Investment Manager shall pay to the Sub-Adviser a monthly fee equal to [_%]
of the fee payable to the Investment Manager under the terms of the Investment
Management Agreement, less [__]% of the dollar amount of any management fees
waived, or expense limitation payments made, by the Investment Manager during
that month.
If this Agreement is terminated prior to the end of any calendar month,
the Sub-Advisory fee shall be prorated for the portion of any month in which
this Agreement is in effect according to the proportion which the number of
calendar days, during which the Agreement is in effect, bears to the number of
calendar days in the month, and shall be payable within 10 days after the date
of termination.
4. The services to be rendered by the Sub-Adviser to the Fund for the
benefit of the Series under the provisions of this Agreement are not to be
deemed to be exclusive, and the Sub-Adviser shall be free to render similar or
different services to others so long as its ability to render the services
provided for in this Agreement shall not be impaired thereby.
5. The Sub-Adviser, its directors, officers, employees, agents and
shareholders may engage in other businesses, may render investment advisory
services to other investment companies, or to any other corporation,
association, firm or individual, and may render underwriting services to the
Fund or to any other investment company, corporation, association, firm or
individual.
The Investment Manager agrees that it shall not use the Sub-Adviser's
name or otherwise refer to the Sub-Adviser in any materials distributed to third
parties, including the Series' shareholders, without the prior written consent
of the Sub-Adviser.
6. In the absence of willful misfeasance, bad faith, gross negligence,
or a reckless disregard of the performance of its duties as Sub-Adviser to the
Fund, the Sub-Adviser shall not be subject to liability to the Fund, to the
Investment Manager or to any shareholder of the Fund for any action or omission
in the course of, or connected with, rendering services hereunder or for any
losses that may be sustained in the purchase, holding or sale of any security,
or otherwise.
7. This Agreement shall be executed and become effective as of the date
written below if approved by the vote of a majority of the outstanding voting
securities of the Series. It shall continue in effect for a period of two years
and may be renewed thereafter only so long as such renewal and continuance is
specifically approved at least annually by the Board of Directors or by the vote
of a majority of the outstanding voting securities of the Series and only if the
terms and the renewal hereof have been approved by the vote of a majority of the
Directors of the Fund who are not parties hereto or interested persons of any
such party, cast in person at a meeting called for the purpose of voting on such
approval. Notwithstanding the foregoing, this Agreement may be terminated by the
Investment Manager or the Fund at any time, without the payment of a penalty, on
sixty days' written notice to the Sub-Adviser, of the Investment Manager's or
the Fund's intention to do so, in the case of the Fund pursuant to action by the
Board of Directors of the Fund or pursuant to the vote of a majority of the
outstanding voting securities of the Series. The Sub-Adviser may terminate this
Agreement at any time, without the payment of a penalty on sixty days' written
notice to the Investment Manager and the Fund of its intention to do so. Upon
termination of this Agreement, the obligations of all the parties hereunder
shall cease and terminate as of the date of such termination, except for any
obligation to respond for a breach of this Agreement committed prior to such
termination, and except for the obligation of the Investment Manager to pay to
the Sub-Adviser the fee provided in Paragraph 4 hereof, prorated to the date of
termination. This Agreement shall automatically terminate in the event of its
assignment. This Agreement shall automatically terminate upon the termination of
the Investment Management Agreement.
8. This Agreement shall extend to and bind the successors of the
parties hereto.
9. For the purposes of this Agreement, the terms "vote of a majority of
the outstanding voting securities"; "interested person"; and "assignment" shall
have the meaning defined in the Investment Company Act of 1940.
IN WITNESS WHEREOF, the parties hereto have caused their corporate
seals to be affixed and duly attested and their presents to be signed by their
duly authorized officers as of the ___ day of _____, 1998.
DELAWARE MANAGEMENT COMPANY, a series of
Delaware Management Business Trust
By:_______________________________________
Name:
Title:
Attest:____________________________________
[SUB-ADVISER NAME]
By:______________________________________
Name:
Title:
Attest:___________________________________
Agreed to and accepted as of the day and year first above written:
[REGISTRANT NAME]
on behalf of the [SERIES NAME]
By:
Chairman
Attest:
EXHIBIT K
Payments made by the Funds to
Delaware Distributors, L.P. and Delaware Service Company, Inc.
during the last fiscal year
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COMPANY/FUND FISCAL 12b-1 ADMINISTRATIVE/
YEAR FEES PAID SERVICE FEES
ENDED TO PAID
DELAWARE TO
DISTRIBUTORS DELAWARE
SERVICE
COMPANY
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DELAWARE GROUP DIVIDEND AND 11/30/97 N/A
INCOME FUND, INC.
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DELAWARE GROUP GLOBAL DIVIDEND 11/30/97 N/A
AND INCOME FUND, INC.
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VOYAGEUR ARIZONA I MUNICIPAL 3/31/98 N/A
INCOME FUND, INC.
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VOYAGEUR COLORADO INSURED 3/31/98 N/A
MUNICIPAL INCOME FUND, INC.
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VOYAGEUR FLORIDA INSURED 3/31/98 N/A
MUNICIPAL INCOME FUND
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VOYAGEUR MINNESOTA MUNICIPAL 3/31/98 N/A
INCOME FUND, INC.
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VOYAGEUR MINNESOTA MUNICIPAL 3/31/98 N/A
INCOME FUND II, INC.
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VOYAGEUR MINNESOTA MUNICIPAL 3/31/98 N/A
INCOME FUND III, INC.
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VOYAGEUR INVESTMENT TRUST(1)
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Delaware-Voyageur Tax-Free 8/31/98
California Insured Fund
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Delaware-Voyageur Tax-Free 8/31/98
Florida Fund
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Delaware-Voyageur Tax-Free 8/31/98
Florida Insured Fund
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Delaware-Voyageur Tax-Free 8/31/98
Kansas Fund
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Delaware-Voyageur Tax-Free 8/31/98
Missouri Insured Fund
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Delaware-Voyageur Tax-Free 8/31/98
New Mexico Fund
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Delaware-Voyageur Tax-Free 8/31/98
Oregon Insured Fund
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Delaware-Voyageur Tax-Free 8/31/98
Utah Fund
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Delaware-Voyageur Tax-Free 8/31/98
Washington Insured Fund
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(1) For fiscal period January 1, 1998 through August 31, 1998.
EXHIBIT L
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization ("Agreement") is made as of
this ___ day of September, 1998 by and between Voyageur Investment Fund, Inc., a
Maryland corporation ("Fund"), and Voyageur Investment Trust, a business trust
created under the laws of the Commonwealth of Massachusetts ("Trust") (the Fund
and the Trust are hereinafter collectively referred to as the "parties").
In consideration of the mutual promises contained herein, and intending
to be legally bound, the parties hereto agree as follows:
1. Plan of Reorganization.
(a) Upon satisfaction of the conditions precedent described in Section
3 hereof, the Trust will convey, transfer and deliver to the Fund at the closing
provided for in Section 2 (hereinafter referred to as the "Closing") all of the
Trust's then-existing assets, the assets belonging to each series of the Trust
to be conveyed, transferred and delivered to the corresponding series of the
Fund. In consideration thereof, the Fund agrees at the Closing (1) to assume and
pay, to the extent that they exist on or after the Effective Date of the
Reorganization (as defined in Section 2 hereof), all of the Trust's obligations
and liabilities, whether absolute, accrued, contingent or otherwise, including
all fees and expenses in connection with the Agreement, which fees and expenses
shall in turn include, without limitation, costs of legal advice, accounting,
printing, mailing, proxy solicitation and transfer taxes, if any, the
obligations and liabilities allocated to each series of the Trust to become the
obligations and liabilities of the corresponding series of the Fund, and (2) to
deliver, in accordance with paragraph (b) of this Section 1, full and fractional
shares of beneficial interest, $.01 par value, of each of the Fund's separate
series and the respective classes of those series, all as set forth in the
Appendix attached hereto (hereinafter, the series are individually and
collectively referred to as "Series of the Fund" and the classes are
individually referred to as a "Class of the Fund" and collectively as "Classes
of the Fund"), equal in number to the number of full and fractional shares of
beneficial interest, no par value, of, respectively, each of the Trust's
separate series and the respective classes of those series, all as set forth in
the Appendix hereto (hereinafter, the series are referred to individually and
collectively as "Series of the Trust" and the classes are referred to
individually as a "Class of the Trust" and collectively, as "Classes of the
Trust") outstanding immediately prior to the Effective Date of the
Reorganization. The transactions contemplated hereby are intended to qualify as
a reorganization within the meaning of Section 368 of the Internal Revenue Code
of 1986, as amended ("Code").
(b) In order to effect such delivery, the Fund will establish an open
account for each shareholder of each Series of the Trust and, on the Effective
Date of the Reorganization, will credit to such account full and fractional
shares of such Series and Class of the Fund equal to the number of full and
fractional shares such shareholder holds in the corresponding Series and Class
of the Trust at the close of regular trading on the New York Stock Exchange on
the business day immediately preceding the Effective Date of the Reorganization;
fractional shares of each Class of the Fund will be carried to the third decimal
place. On such date, the net asset value per share of beneficial interest of
each Class of the Fund shall be deemed to be the same as the net asset value per
share of beneficial interest of the corresponding Class of the Trust. On such
date, each certificate representing shares of a Series and Class of the Trust
will represent the same number of shares of the corresponding Series and Class
of the Fund. Each shareholder of the Trust will have the right to exchange his
(her) share certificates for share certificates of the Fund. However, a
shareholder need not make this exchange of certificates unless he (she) so
desires. Simultaneously with the crediting of the shares of the Series and
Classes of the Fund to the shareholders of record of the Trust, the shares of
the Series and Classes of the Trust held by such shareholder shall be cancelled.
(c) As soon as practicable after the Effective Date of the
Reorganization, the Trust shall take all necessary steps under Massachusetts law
to effect a complete dissolution of the Trust.
2. Closing and Effective Date of the Reorganization.
The Closing shall consist of (i) the conveyance, transfer and delivery
of the Trust's assets to the Fund, in exchange for the assumption and payment by
the Fund of the Trust's liabilities and (ii) the issuance and delivery of the
Fund's shares in accordance with Section 1(b), together with related acts
necessary to consummate such transactions. The Closing shall occur either on (d)
the business day immediately following the later of receipt of all necessary
regulatory approvals and the final adjournment of the meeting of shareholders of
the Trust at which this Agreement will be considered or (e) such later date as
the parties may mutually agree ("Effective Date of the Reorganization").
3. Conditions Precedent.
The obligations of the Trust and the Fund to effectuate the
reorganization hereunder shall be subject to the satisfaction of each of the
following conditions:
(a) Such authority and orders from the Securities and Exchange
Commission ("Commission") as may be necessary to permit the parties to carry out
the transactions contemplated by this Agreement shall have been received;
(b) (i) One or more post-effective amendments to the Trust's
Registration Statement on Form N-1A ("Registration Statement") under the
Securities Act of 1933, as amended, and the Investment Company Act of 1940, as
amended ("1940 Act"), containing such amendments to the Registration Statement
as are determined by the Directors of the Fund to be necessary and appropriate
as a result of this Agreement shall have been filed with the Commission; (ii)
the Fund shall have adopted as its own such Registration Statement, as so
amended; (iii) the most recent post-effective amendment to the Registration
Statement filed with the Commission relating to the Fund shall have become
effective, and no stop-order suspending the effectiveness of the Registration
Statement shall have been issued, and no proceeding for that purpose shall have
been initiated or threatened by the Commission (other than any such stop-order,
proceeding or threatened proceeding which shall have been withdrawn or
terminated); and (iv) an amendment of the Form N-8A Notification of Registration
filed pursuant to Section 8(a) of the 1940 Act ("Form N-8A") reflecting the
change in legal form of the Trust to a Maryland corporation shall have been
filed with the Commission and the Fund shall have expressly adopted such amended
Form N-8A as its own for purposes of the 1940 Act;
(c) Each party shall have received an opinion of Stradley, Ronon,
Stevens & Young, LLP, Philadelphia, Pennsylvania, to the effect that the
reorganization contemplated by this Agreement qualifies as a "reorganization"
under Section 368 of the Code, and thus will not give rise to the recognition of
income, gain or loss for federal income tax purposes to the Trust, the Fund or
the shareholders of the Trust or the Fund;
(d) The Trust shall have received an opinion of Stradley, Ronon,
Stevens & Young, LLP, dated the Effective Date of the Reorganization, addressed
to and in form and substance satisfactory to the Trust, to the effect that (i)
the Fund is duly organized, validly existing and in good standing as a
corporation under the laws of the State of Maryland; (ii) this Agreement and the
reorganization provided for herein and the execution and delivery of this
Agreement have been duly authorized and approved by all requisite corporate
action of the Fund and this Agreement has been duly executed and delivered by
the Fund and is a legal, valid and binding agreement of the Fund in accordance
with its terms; and (iii) the shares of the Fund to be issued in the
reorganization have been duly authorized and, upon issuance thereof in
accordance with this Agreement, will have been validly issued and fully paid and
will be non-assessable by the Fund;
(e) The Fund shall have received the opinion of Stradley, Ronon,
Stevens & Young, LLP, dated the Effective Date of the Reorganization, addressed
to and in form and substance satisfactory to the Fund, to the effect that: (i)
the Trust is duly organized and validly existing under the laws of the
Commonwealth of Massachusetts; (ii) the Trust is an open-end investment company
of the management type registered under the 1940 Act; and (iii) this Agreement
and the reorganization provided for herein and the execution and delivery of
this Agreement have been duly authorized and approved by all requisite action of
the Trust and this Agreement has been duly executed and delivered by the Trust
and is a legal, valid and binding agreement of the Trust in accordance with its
terms;
(f) The shares of each Series and Class of the Fund are eligible for
offering to the public in those states of the United States and jurisdictions in
which the shares of their corresponding Series and Class of the Trust are
presently eligible for offering to the public so as to permit the issuance and
delivery of shares contemplated by this Agreement to be consummated;
(g) This Agreement and the reorganization contemplated hereby shall
have been adopted and approved by the appropriate action of the shareholders of
the Trust at an annual or special meeting or any adjournment thereof;
(h) The shareholders of the Trust shall have voted to direct the Trust
to vote, and the Trust shall have voted, as sole shareholder of the Fund, to:
(i) Elect as Directors of the Fund the following individuals:
Messrs. Walter P. Babich, Anthony D. Knerr, W. Thacher Longstreth, Charles E.
Peck, Wayne A. Stork, Thomas F. Madison, Jeffrey J. Nick and Ms. Ann R. Leven;
(ii) Select Ernst & Young LLP as the independent auditors for the
Fund for the fiscal year ending August 31, 1999;
(iii) With respect to each Series, if at the annual or special
meeting specified in paragraph (g) of this Section 3 (or any adjournment
thereof) the shareholders of a Series of the Trust (A) approve a proposal for a
new investment management agreement ("New Investment Management Agreement")
between Delaware Management Company, a series of Delaware Management Business
Trust ("DMC") and the Trust on behalf of such Series, approve an investment
management agreement between DMC and the Fund on behalf of such Series, which is
substantially identical to the New Investment Management Agreement, or (B) do
not approve a proposal for a New Investment Management Agreement between DMC and
the Trust on behalf of such Series, approve an investment management agreement
between DMC and the Fund on behalf of such Series, which is substantially
identical to the then-current investment management agreement between DMC and
the Trust on behalf of such Series;
(i) The Directors of the Fund shall have taken the following actions at
a meeting duly called for such purposes:
(i) Approval of the investment management agreements described in
paragraph (h) of this Section 3 hereof for each Series of the Fund;
(ii) Approval of a distribution plan, if any, for each Class of
each Series of the Fund, as adopted pursuant to Rule 12b-1 under the 1940 Act,
which is substantially identical to the then-current distribution plan, if any,
as adopted pursuant to Rule 12b-1 under the 1940 Act for each Class of each
corresponding Series of the Trust;
(iii) Approval of the assignment of the Trust's Custodian
Agreement with Norwest Bank Minnesota, N.A. to the Fund;
(iv) Selection of Ernst & Young LLP as the Fund's independent
auditors for the fiscal year ending August 31, 1999;
(v) Approval of the Fund's Amended and Restated Shareholders
Services Agreement with Delaware Service Company, Inc.;
(vi) Approval of the Fund Accounting Agreement with Delaware
Service Company, Inc. that covers the funds comprising the Delaware Investments
Family of Funds;
(vii) Approval of the Distribution Agreement between the Fund
and Delaware Distributors, L.P. on behalf of the Series and Classes;
(viii) Authorization of the issuance by the Fund, prior to the
Effective Date of the Reorganization, of one share of each Series and Class of
the Fund to the Trust in consideration for the payment of $1.00 per share for
the purpose of enabling the Trust to vote on the matters referred in paragraph
(h) of this Section 3 hereof;
(ix) Submission of the matters referred to in paragraph (h) of
this Section 3 to the Trust as sole shareholder of each Series of the Fund; and
(x) Authorization of the issuance and delivery by the Fund of
shares of each Series and Class of the Fund on the Effective Date of the
Reorganization in exchange for the assets of the corresponding Series of the
Trust pursuant to the terms and provisions of this Agreement.
At any time prior to the Closing, any of the foregoing conditions may
be waived by the Board of Trustees of the Trust if, in the judgment of such
Board, such waiver will not affect in a materially adverse way the benefits
intended to be accorded the shareholders of the Trust under this Agreement.
4. Termination.
The Board of Trustees of the Trust may terminate this Agreement and
abandon the reorganization contemplated hereby, notwithstanding approval thereof
by the shareholders of the Trust, at any time prior to the Effective Date of the
Reorganization if, in the judgment of such Board, the facts and circumstances
make proceeding with this Agreement inadvisable.
5. Entire Agreement.
This Agreement embodies the entire agreement between the parties and
there are no agreements, understandings, restrictions or warranties among the
parties other than those set forth herein or herein provided for.
6. Further Assurances.
The Trust and the Fund shall take such further action as may be
necessary or desirable and proper to consummate the transactions contemplated
hereby.
7. Counterparts.
This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same instrument.
8. Governing Law.
This Agreement and the transactions contemplated hereby shall be
governed by and construed and enforced in accordance with the laws of the
Commonwealth of Massachusetts.
IN WITNESS WHEREOF, the Fund and the Trust have each caused this
Agreement and Plan of Reorganization to be executed on its behalf by its
Chairman, President or a Vice President and attested by its Secretary or an
Assistant Secretary, all as of the day and year first-above written.
Voyageur Investment Trust
(a Massachusetts business trust)
Attest:
By: By:
George M. Chamberlain, Jr. Wayne A. Stork
Secretary Chairman
Voyageur Investment Fund, Inc.
(a Maryland corporation)
Attest:
By: By:
Eric E. Miller Jeffrey J. Nick
Assistant Secretary President
APPENDIX
Series and Classes of Voyageur Corresponding Series and
Investment Trust Classes of Voyageur Investment
Fund, Inc.
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
California Insured Fund California Insured Fund
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
California Insured Fund Class A California Insured Fund Class A
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
California Insured Fund Class B California Insured Fund Class B
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
California Insured Fund Class C California Insured Fund Class C
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
California Insured Fund California Insured Fund
Institutional Class Institutional Class
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Fund Florida Fund
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Fund Class A Florida Fund Class A
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Fund Class B Florida Fund Class B
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Fund Class C Florida Fund Class C
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Fund Institutional Class Florida Fund Institutional Class
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Insured Fund Florida Insured Fund
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Insured Fund Class A Florida Insured Fund Class A
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Insured Fund Class B Florida Insured Fund Class B
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Insured Fund Class C Florida Insured Fund Class C
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Florida Insured Fund Florida Insured Fund
Institutional Class Institutional Class
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Kansas Fund Kansas Fund
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Kansas Fund Class A Kansas Fund Class A
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Kansas Fund Class B Kansas Fund Class B
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Kansas Fund Class C Kansas Fund Class C
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Kansas Fund Institutional Class Kansas Fund Institutional Class
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Missouri Insured Fund Missouri Insured Fund
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Missouri Insured Fund Class A Missouri Insured Fund Class A
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Missouri Insured Fund Class B Missouri Insured Fund Class B
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Missouri Insured Fund Class C Missouri Insured Fund Class C
Delaware-Voyageur Tax-Free Delaware-Voyageur Tax-Free
Missouri Insured Fund Missouri Insured Fund
Institutional Class Institutional Class
Delaware-Voyageur Tax-Free New Delaware-Voyageur Tax-Free New
Mexico Fund Mexico Fund
Delaware-Voyageur Tax-Free New Delaware-Voyageur Tax-Free
Mexico Fund Class A New Mexico Fund Class A
Delaware-Voyageur Tax-Free New Delaware-Voyageur Tax-Free
Mexico Fund Class B New Mexico Fund Class B
Delaware-Voyageur Tax-Free New Delaware-Voyageur Tax-Free
Mexico Fund Class C New Mexico Fund Class C
Delaware-Voyageur Tax-Free New Delaware-Voyageur Tax-Free
Mexico Fund Institutional Class New Mexico Fund Institutional
Delaware-Voyageur Tax-Free Class
Oregon Insured Fund Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Oregon Insured Fund
Oregon Insured Fund Class A Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Oregon Insured Fund Class A
Oregon Insured Fund Class B Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Oregon Insured Fund Class B
Oregon Insured Fund Class C Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Oregon Insured Fund Class C
Oregon Insured Fund Delaware-Voyageur Tax-Free
Institutional Class Oregon Insured Fund
Delaware-Voyageur Tax-Free Utah Institutional Class
Fund Delaware-Voyageur Tax-Free Utah
Delaware-Voyageur Tax-Free Fund
Utah Fund Class A Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Utah Fund Class A
Utah Fund Class B Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Utah Fund Class B
Utah Fund Class C Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Utah Fund Class C
Utah Fund Institutional Class Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Utah Fund Institutional Class
Washington Insured Fund Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Washington Insured Fund
Washington Insured Fund Class A Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Washington Insured Fund Class A
Washington Insured Fund Class B Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Washington Insured Fund Class B
Washington Insured Fund Class C Delaware-Voyageur Tax-Free
Delaware-Voyageur Tax-Free Washington Insured Fund Class C
Washington Insured Fund Delaware-Voyageur Tax-Free
Institutional Class Washington Insured Fund
Institutional Class
AGREEMENT AND PLAN OF REORGANIZATION
This Agreement and Plan of Reorganization ("Agreement") is made as of
this ___ day of September, 1998 by and between Voyageur Florida Insured
Municipal Income Fund, Inc., a Maryland corporation ("Fund"), and Voyageur
Florida Insured Municipal Income Fund, a business trust created under the laws
of the Commonwealth of Massachusetts ("Trust") (the Fund and the Trust are
hereinafter collectively referred to as the "parties").
In consideration of the mutual promises contained herein, and intending
to be legally bound, the parties hereto agree as follows:
1. Plan of Reorganization.
(a) Upon satisfaction of the conditions
precedent described in Section 3 hereof, the Trust will convey, transfer and
deliver to the Fund at the closing provided for in Section 2 (hereinafter
referred to as the "Closing") all of the Trust's then-existing assets. In
consideration thereof, the Fund agrees at the Closing (1) to assume and pay, to
the extent that they exist on or after the Effective Date of the Reorganization
(as defined in Section 2 hereof), all of the Trust's obligations and
liabilities, whether absolute, accrued, contingent or otherwise, including all
fees and expenses in connection with the Agreement, which fees and expenses
shall in turn include, without limitation, costs of legal advice, accounting,
printing, mailing, proxy solicitation and transfer taxes, if any, the
obligations and liabilities of the Trust to become the obligations and
liabilities of the Fund, and (2) to deliver, in accordance with paragraph (b) of
this Section 1, full and fractional shares of beneficial interest, $.01 par
value, of each of the Fund's separate classes and the respective series of those
classes, as applicable, all as set forth on Exhibit A attached hereto
(hereinafter, the classes of the Fund are individually referred to as a "Class
of the Fund" and collectively as "Classes of the Fund" and the series of the
Fund are individually and collectively referred to as "Series of the Fund"),
equal in number to the number of full and fractional shares of beneficial
interest, $.01 par value, of, respectively, each of the Trust's separate classes
and the respective series of those classes, as applicable, all as set forth on
Exhibit A attached hereto (hereinafter, the classes of the Trust are
individually referred to as a "Class of the Trust" and collectively as "Classes
of the Trust" and the series of the Trust are individually and collectively
referred to as "Series of the Trust") outstanding immediately prior to the
Effective Date of the Reorganization. The transactions contemplated hereby are
intended to qualify as a reorganization within the meaning of Section 368 of the
Internal Revenue Code of 1986, as amended ("Code").
(b) In order to effect such delivery, the Fund will establish an open
account for each shareholder of each Class and Series of the Trust and, on the
Effective Date of the Reorganization, will credit to such account full and
fractional shares of such Class and Series of the Fund equal to the number of
full and fractional shares such shareholder holds in the corresponding Class and
Series of the Trust at the close of regular trading on the New York Stock
Exchange on the business day immediately preceding the Effective Date of the
Reorganization; fractional shares of each Class and Series of the Fund will be
carried to the third decimal place. On such date, the net asset value per share
of the Common Shares of the Fund shall be deemed to be the same as the net asset
value per share of the Common Shares of the Trust. On such date, each
certificate representing shares of a Class and Series of the Trust will
represent the same number of shares of the corresponding Class and Series of the
Fund. Each shareholder of the Trust will have the right to exchange his (her)
share certificates for share certificates of the Fund. However, a shareholder
need not make this exchange of certificates unless he (she) so desires.
Simultaneously with the crediting of the shares of the Classes and Series of the
Fund to the shareholders of record of the Trust, the shares of the Classes and
Series of the Trust held by such shareholder shall be cancelled.
(c) As soon as practicable after the Effective Date of the
Reorganization, the Trust shall take all necessary steps under Massachusetts law
to effect a complete dissolution of the Trust.
2. Closing and Effective Date of the Reorganization.
The Closing shall consist of (i) the conveyance, transfer and delivery
of the Trust's assets to the Fund, in exchange for the assumption and payment by
the Fund of the Trust's liabilities and (ii) the issuance and delivery of the
Fund's shares in accordance with Section 1(b), together with related acts
necessary to consummate such transactions. The Closing shall occur either on (a)
the business day immediately following the later of receipt of all necessary
regulatory approvals and the final adjournment of the meeting of shareholders of
the Trust at which this Agreement will be considered or (b) such later date as
the parties may mutually agree ("Effective Date of the Reorganization").
3. Conditions Precedent.
The obligations of the Trust and the Fund to effectuate the
reorganization hereunder shall be subject to the satisfaction of each of the
following conditions:
(a) A supplemental listing application shall have been filed with the
American Stock Exchange ("AMEX") in accordance with the rules of the AMEX and
such approvals from the AMEX as may be necessary to permit the parties to carry
out the transactions contemplated by this Agreement shall have been received;
(b) (i) One or more post-effective amendments to the Trust's
Registration Statement on Form N-2 ("N-2 Registration Statement") under the
Investment Company Act of 1940, as amended ("1940 Act"), containing such
amendments to the N-2 Registration Statement as are determined by the Directors
of the Fund to be necessary and appropriate as a result of this Agreement shall
have been filed with the Securities and Exchange Commission ("Commission"); (ii)
the Fund shall have adopted as its own such N-2 Registration Statement, as so
amended; (iii) a registration statement on Form 8-A ("8-A Registration
Statement") under the Securities Exchange Act of 1934, as amended, shall have
been filed with the Commission and the AMEX by the Fund; (iv) the most recent
post-effective amendment to the N-2 Registration Statement and the 8-A
Registration Statement filed with the Commission relating to the Fund shall have
become effective, and no stop-order suspending the effectiveness of the N-2
Registration Statement or the 8-A Registration Statement shall have been issued,
and no proceeding for that purpose shall have been initiated or threatened by
the Commission (other than any such stop-order, proceeding or threatened
proceeding which shall have been withdrawn or terminated); and (v) an amendment
of the Form N-8A Notification of Registration filed pursuant to Section 8(a) of
the 1940 Act ("Form N-8A") reflecting the change in legal form of the Trust to a
Maryland corporation shall have been filed with the Commission and the Fund
shall have expressly adopted such amended Form N-8A as its own for purposes of
the 1940 Act;
(c) Each party shall have received an opinion of Stradley, Ronon,
Stevens & Young, LLP, Philadelphia, Pennsylvania, to the effect that the
reorganization contemplated by this Agreement qualifies as a "reorganization"
under Section 368 of the Code, and thus will not give rise to the recognition of
income, gain or loss for federal income tax purposes to the Trust, the Fund or
the shareholders of the Trust or the Fund;
(d) The Trust shall have received an opinion of Stradley, Ronon,
Stevens & Young, LLP, dated the Effective Date of the Reorganization, addressed
to and in form and substance satisfactory to the Trust, to the effect that (i)
the Fund is duly organized, validly existing and in good standing as a
corporation under the laws of the State of Maryland; (ii) this Agreement and the
reorganization provided for herein and the execution and delivery of this
Agreement have been duly authorized and approved by all requisite corporate
action of the Fund and this Agreement has been duly executed and delivered by
the Fund and is a legal, valid and binding agreement of the Fund in accordance
with its terms; and (iii) the shares of the Fund to be issued in the
reorganization have been duly authorized and, upon issuance thereof in
accordance with this Agreement, will have been validly issued and fully paid and
will be non-assessable by the Fund;
(e) The Fund shall have received the opinion of Stradley, Ronon,
Stevens & Young, LLP, dated the Effective Date of the Reorganization, addressed
to and in form and substance satisfactory to the Fund, to the effect that: (i)
the Trust is duly organized and validly existing under the laws of the
Commonwealth of Massachusetts; (ii) the Trust is a closed-end investment company
of the management type registered under the 1940 Act; and (iii) this Agreement
and the reorganization provided for herein and the execution and delivery of
this Agreement have been duly authorized and approved by all requisite action of
the Trust and this Agreement has been duly executed and delivered by the Trust
and is a legal, valid and binding agreement of the Trust in accordance with its
terms;
(f) The shares of each Class and Series of the Fund are eligible for
offering to the public in those states of the United States and jurisdictions in
which the shares of their corresponding Class and Series of the Trust are
presently eligible for offering to the public so as to permit the issuance and
delivery of shares contemplated by this Agreement to be consummated;
(g) This Agreement and the reorganization contemplated hereby shall
have been adopted and approved by the appropriate action of the shareholders of
the Trust at an annual or special meeting or any adjournment thereof;
(h) The shareholders of the Trust shall have voted to direct the Trust
to vote, and the Trust shall have voted, as sole shareholder of the Fund, to:
(i) Elect as Directors of the Fund the following individuals:
Messrs. Walter P. Babich, Anthony D. Knerr, W. Thacher Longstreth, Charles E.
Peck, Wayne A. Stork, Thomas F. Madison, Jeffrey J. Nick and Ms. Ann R. Leven;
(ii) Select Ernst & Young LLP as the independent auditors for
the Fund for the fiscal year ending March 31, 1999; and
(iii) If at the annual or special meeting specified in paragraph
(g) of this Section 3 (or any adjournment thereof) the shareholders of the Trust
(A) approve a proposal for a new investment management agreement ("New
Investment Management Agreement") between Delaware Management Company, a series
of Delaware Management Business Trust ("DMC") and the Trust, approve an
investment management agreement between DMC and the Fund, which is substantially
identical to the New Investment Management Agreement, or (B) do not approve a
proposal for a New Investment Management Agreement between DMC and the Trust,
approve an investment management agreement between DMC and the Fund, which is
substantially identical to the then-current investment management agreement
between DMC and the Trust;
(i) The Directors of the Fund shall have taken the following actions at
a meeting duly called for such purposes:
(i) Approval of the investment management agreements described
in paragraph (h) of this Section 3 hereof for the Fund;
(ii) Approval of the assignment of the Trust's Custodian
Agreement with Norwest Bank Minnesota, N.A. to the Fund;
(iii) Selection of Ernst & Young LLP as the Fund's independent
auditors for the fiscal year ending March 31, 1999;
(iv) Approval of the Fund's Amended and Restated Shareholders
Services Agreement with Delaware Service Company, Inc.;
(v) Approval of the Fund Accounting Agreement with
Delaware Service Company, Inc. that covers the funds comprising the Delaware
Investments Family of Funds;
(vi) Authorization of the issuance by the Fund, prior to the
Effective Date of the Reorganization, of one share of each Class and Series of
the Fund to the Trust in consideration for the payment of $10.00 per share for
the purpose of enabling the Trust to vote on the matters referred in paragraph
(h) of this Section 3 hereof;
(vii) Submission of the matters referred to in paragraph (h) of
this Section 3 to the Trust as sole shareholder of each Class and Series of the
Fund; and
(viii) Authorization of the issuance and delivery by the Fund of
shares of each Class and Series of the Fund on the Effective Date of the
Reorganization in exchange for the assets of the Trust pursuant to the terms and
provisions of this Agreement.
At any time prior to the Closing, any of the foregoing conditions may
be waived by the Board of Trustees of the Trust if, in the judgment of such
Board, such waiver will not affect in a materially adverse way the benefits
intended to be accorded the shareholders of each Class and Series of the Trust
under this Agreement.
4. Termination.
The Board of Trustees of the Trust may terminate this Agreement and
abandon the reorganization contemplated hereby, notwithstanding approval thereof
by the shareholders of the Trust, at any time prior to the Effective Date of the
Reorganization if, in the judgment of such Board, the facts and circumstances
make proceeding with this Agreement inadvisable.
5. Entire Agreement.
This Agreement embodies the entire agreement between the parties and
there are no agreements, understandings, restrictions or warranties among the
parties other than those set forth herein or herein provided for.
6. Further Assurances.
The Trust and the Fund shall take such further action as may be
necessary or desirable and proper to consummate the transactions contemplated
hereby.
7. Counterparts.
This Agreement may be executed simultaneously in two or more
counterparts, each of which shall be deemed an original, but all of which shall
constitute one and the same instrument.
8. Governing Law.
This Agreement and the transactions contemplated hereby shall be
governed by and construed and enforced in accordance with the laws of the
Commonwealth of Massachusetts.
IN WITNESS WHEREOF, the Fund and the Trust have each caused this
Agreement and Plan of Reorganization to be executed on its behalf by its
Chairman, President or a Vice President and attested by its Secretary or an
Assistant Secretary, all as of the day and year first-above written.
Voyageur Florida Insured Municipal Income Fund
(a Massachusetts business trust)
Attest:
By: By:
George M. Chamberlain, Jr. Wayne A. Stork
Secretary Chairman
Voyageur Florida Insured Municipal Income Fund, Inc.
(a Maryland corporation)
Attest:
By: By:
Eric E. Miller Jeffrey J. Nick
Assistant Secretary President
APPENDIX
Classes and Series of Corresponding Classes and
Voyageur Florida Insured Series of Voyageur Florida
Municipal Income Fund Insured Municipal Income
Fund, Inc.
Common Shares Common Shares
Municipal Income Preferred Municipal Income Preferred
Shares Shares
Series A Series A
Series B Series B
EXHIBIT M
DIFFERENCES IN LEGAL STRUCTURES
Unless otherwise defined in this Exhibit, capitalized terms have the
meanings set forth in Proposal Seven.
Differences Between the Legal Structure of a
Maryland Corporation and a Massachusetts Business Trust
Investment Trust and Florida Fund are organized as Massachusetts
business trusts and may be referred to herein collectively as the "Massachusetts
Trusts." This discussion provides a summary of the material differences between
the legal structure of an investment company organized as a Maryland corporation
and subject to the Maryland Code and an investment company organized as a
Massachusetts business trust under the Massachusetts Statute. The different
legal structures are considered by contrasting the provisions of the Agreements
and Declarations of Trust and bylaws of the Massachusetts Trusts with the
corporate charter and bylaws of the New Corporations, as well as the respective
laws applicable to such entities.
The following is only a summary of the material differences between the
charters and bylaws of the New Corporations and the Maryland Code, and the
Massachusetts Declarations and bylaws for the Massachusetts Trusts and the
Massachusetts Statute. It is not a complete list of differences. Shareholders
should refer to the provisions of such charters and bylaws of the New
Corporations, the Maryland Code, the Massachusetts Declarations and bylaws and
the Massachusetts Statute directly for a more thorough comparison.
Governing Documents. In order to form a Maryland corporation, one or
more individuals over the age of 18 must sign and acknowledge articles of
incorporation which contain statutorily required provisions and file them for
record with the State Department of Assessments and Taxation of Maryland. The
shareholders of a Maryland corporation are subject to the Maryland Code, the
charter of the corporation and its bylaws. The business and affairs of a
Maryland corporation are managed under the direction of its Board of Directors.
In order to be considered a Massachusetts business trust, an entity
must file its trust document with the Secretary of the Commonwealth of
Massachusetts and with the clerk of every city or town in Massachusetts where
the trust has a usual place of business. The business and affairs of a
Massachusetts business trust are governed by its trust instrument, called an
Agreement and Declaration of Trust, as well as its bylaws. The Agreements and
Declarations of Trust of the Massachusetts Trusts are referred to herein
individually as a "Massachusetts Declaration" or collectively as the
"Massachusetts Declarations."
Shareholder Voting Rights and Meetings. Shareholders of both a Maryland
corporation and a Massachusetts business trust are subject to the voting
requirements contained in the 1940 Act for electing and removing
trustees/directors, selecting auditors and approving investment advisory
agreements and plans of distribution.
The charter of the New Corporation corresponding to Investment Trust,
consistent with the Maryland Code, provides that the holder of each share of
stock of the New Corporation is entitled to one vote for each full share, and a
fractional vote for each fractional share of stock, irrespective of the series
or class. The charter of such New Corporation goes on to state that, on any
matter submitted to a vote of shareholders, all shares of the corporation then
issued and outstanding and entitled to vote, irrespective of series or class,
shall be voted in the aggregate and not by series or class except when (1)
otherwise expressly required by the Maryland Code; (2) required by the 1940 Act,
then shares shall be voted by individual series or class; and (3) the matter
does not affect any interest of the particular series or class, then only
shareholders of the affected series or class shall be entitled to vote thereon,
unless otherwise expressly provided in the corporation's charter.
There is no provision in the Massachusetts Statute addressing voting by
beneficial owners. With respect to voting by series or class, the Massachusetts
Declaration of Investment Trust is similar to the Maryland charter provisions
for its corresponding New Corporation. Specifically, such Massachusetts
Declaration provides that each whole share shall be entitled to one vote as to
any matter on which it is entitled to vote and fractional shares shall be
entitled to a proportionate fractional vote. With respect to Investment Trust,
except with respect to matters as to which the trustees have determined that
only the interests of one or more particular series or classes are affected or
as required by law, all of the shares of each series or class shall, on matters
as to which such series or class is entitled to vote, vote with the other series
or classes so entitled as a single class. However, with respect to matters that
would otherwise be voted on by two or more series or classes as a single class,
the trustees may, in their sole discretion, submit such matters to the
shareholders of any or all such series or classes, separately. The Maryland Code
and the charter of the New Corporation corresponding to Investment Trust do not
contain a comparable provision in this regard.
Pursuant to the charter of the New Corporation corresponding to the
Florida Fund, as a general matter, the holders of the common shares and
preferred shares have equal voting rights with one vote per share and will vote
together as a single class. No fractional preferred shares may be issued or
voted. There are circumstances under which the holders of the common shares and
preferred shares vote separately which are the same under the Maryland charter
and the Massachusetts Declaration.
Matters Requiring Shareholder Approval. Under the Maryland Code and the
charter of the New Corporation corresponding to Investment Trust, shareholder
approval by a majority of all votes entitled to be cast on the matter is
required to approve: (1) amendments of the charter except as described below;
(2) a reduction of stated capital; (3) a consolidation, merger, share exchange
or transfer of assets, including a sale of substantially all of the assets of
the corporation; (4) a distribution in partial liquidation; or (5) a voluntary
dissolution.
Shareholders of the New Corporation corresponding to the Florida Fund
are also entitled to vote on (1) amendments of the charter except as described
below; (2) a reduction of stated capital; (3) a consolidation, merger, share
exchange or transfer of assets, including a sale of substantially all the assets
of the corporation; (4) a voluntary dissolution; (5) a conversion of the
corporation from a closed-end investment company to an open-end investment
company; or (6) such additional matters as may be required or authorized by law,
the 1940 Act, the charter, the bylaws or any registration with a securities
regulatory authority, as the directors may consider necessary or desirable. The
vote required to approve such matters under the Maryland charter is the same as
that required under the Massachusetts Declaration.
The Massachusetts Declarations provide the trustees with a great deal
of latitude as to which matters are to be submitted to a vote of shareholders.
Specifically, shareholders have the power to vote only: (i) for the election of
trustees; (ii) for certain amendments to the Massachusetts Declarations; (iii)
to the same extent as shareholders of a Massachusetts business corporation as to
whether or not a court action, proceeding or claim should be brought or
maintained derivatively or as a class action; (iv) on termination of the Trust
or any series; (v) on plans of distribution (for Investment Trust); (vi) on any
manager or sub-advisor to the extent provided by the 1940 Act; or (vii) on
certain other matters as may be required by law, the bylaws, any registration of
the Trust with the Securities and Exchange Commission, or as the trustees
consider necessary or desirable. In addition, the holders of the common shares
and preferred shares of the Florida Fund have the power to vote for the removal
of trustees, but only for cause.
Unlike the Maryland Code, there is no specific provision under the
Massachusetts Statute with respect to amendments of the Massachusetts
Declarations. Under the Massachusetts Declarations, however, shareholders are
generally entitled to vote on such amendments. In the case of Investment Trust,
amendments to the Massachusetts Declaration require the approval of a majority
of the shareholders entitled to vote, except as described below.
In the case of the Florida Fund, as a general matter, amendments to the
Massachusetts Declaration may be adopted with the consent of shareholders
holding more than 50% of the shares entitled to vote. Amendments to the
provisions of the Massachusetts Declaration of the Florida Fund relating to
shareholder voting powers, meetings and certain fundamental changes, such as
mergers, sale of assets and termination of the Florida Fund, must be approved by
the affirmative vote of the holders of at least 66 2/3% of the outstanding
common shares and preferred shares voting as a single class, unless (i) such
action has previously been approved, adopted or authorized by the affirmative
vote of two-thirds of the total number of trustees; or (ii) a vote by class is
required by law. If the action has previously been approved, adopted or
authorized by the affirmative vote of two-thirds of the total number of
trustees, the action may be approved by the affirmative vote of the holders of
only a majority of the outstanding common shares and preferred shares voting as
a single class. If a class vote is required by law, a vote in favor of the
action of 66 2/3% of the holders of the class is required, or such lower
percentage as may be required by law. In addition, any series of a class that is
adversely affected in a manner different from other series of the same class,
together with any other series of the same class adversely affected in the same
manner, shall be treated as a separate class. Any amendment, alteration or
repeal of the Massachusetts Declaration, whether by merger or otherwise, that
affects any preference, right or power of the common shares or preferred shares
(or a series of such shares), any reorganization of the Florida Fund that
adversely affects the holders of preferred shares or action that changes the
fundamental investment policies requires a class or series vote, as applicable.
The charter of the New Corporation corresponding to the Florida Fund has the
same provisions as described for the Florida Fund.
The Massachusetts Declaration of Investment Trust may be amended by
trustee action only in order to modify provisions relating to the shares of
beneficial interest for the purpose of (1) responding to or complying with any
applicable laws, provided that the amendment is consistent with the fair and
equitable treatment of all shareholders, or (2) designating and establishing
series or classes. The trustees of Florida Fund may amend the Massachusetts
Declaration without the vote or consent of shareholders at any time if the
trustees deem it necessary to conform the Massachusetts Declaration to
applicable laws. The charter of the New Corporation corresponding to the Florida
Fund does not include this provision for amendments of the charter. Under the
Maryland Code, the board of directors of the New Corporation corresponding to
Investment Trust (an open-end investment company) may amend the charter of the
New Corporation to change the name of the New Corporation or any classes or
series without approval of the shareholders. Under the Maryland Code, the board
of directors of the New Corporation corresponding to the Florida Fund (a
closed-end investment company) may not amend the charter of the New Corporation
to change the name of the New Corporation or any classes or series without the
approval of the shareholders entitled to vote on the matter. The Massachusetts
Declarations do not require shareholder approval to change the names of the
Massachusetts Trusts and any classes or series.
Removal of Directors/Trustees. Unless the charter provides otherwise,
the Maryland Code requires the affirmative vote of a majority of all votes
entitled to be cast for the election of directors to remove a director, with or
without cause. With respect to a corporation where the shareholders of a class
or series are entitled separately to elect one or more directors, such as the
New Corporation corresponding to the Florida Fund, a director elected by a class
or series may not be removed without cause except by the affirmative vote of a
majority of all the votes of that series or class, unless the charter provides
for a different vote. The Massachusetts Declaration of the Florida Fund and the
charter of the New Corporation corresponding to the Florida Fund provide that
the holders of the preferred shares, voting as a separate class, are entitled to
elect two of the trustees or directors, as applicable, and, if dividends for two
years are not paid to the holders of the preferred shares, such holders are
entitled to elect a majority of the Board of Trustees or Directors, as
applicable. The provisions contained in the charter of the New Corporation
corresponding to the Florida Fund with respect to removal of a director are the
same as the provisions contained in the Massachusetts Declaration, as described
below, except that directors of a Maryland corporation may not remove other
directors.
The Massachusetts Statute is silent with respect to the removal of
trustees from office. The Massachusetts Declaration of Investment Trust reserves
the power to remove trustees to the trustees themselves. The Massachusetts
Declaration of Florida Fund provides that the trustees may remove a trustee. In
addition, under the Massachusetts Declaration of Florida Fund, shareholders are
also entitled to vote for the removal of trustees. A trustee may be removed only
for cause (willful misconduct, dishonesty, fraud or a felony conviction) and
only by action of 66 2/3% of the outstanding shares of the class or classes
that elected such trustee or by action of 66 2/3% of the remaining trustees.
Quorum Requirements. The Maryland Code and the bylaws of the New
Corporation corresponding to Investment Trust provide that the presence in
person or by proxy of the holders of record of a majority of the outstanding
shares of stock entitled to vote shall constitute a quorum, except as provided
otherwise by the charter or the 1940 Act. The charter of the New Corporation
corresponding to Investment Trust does not contain specific quorum requirements.
When a quorum is present, a majority of the shares entitled to vote held by
shareholders present in person or by proxy shall decide any matter unless a
different vote is required under the Maryland Code, the 1940 Act or the charter.
The bylaws of such New Corporation also provide that a plurality of all votes
cast at a meeting where a quorum is present shall be sufficient for the election
of a director.
With respect to the New Corporation corresponding to the Florida Fund,
the bylaws provide that the holders of a majority of the outstanding shares of
stock entitled to vote at the meeting, present in person or by proxy, constitute
a quorum, except that if the holders of the preferred shares are entitled to
elect any directors by class vote, as described above in "Removal of
Directors/Trustees," the holders of 33 1/3% of such shares entitled to vote at
the meeting constitute a quorum for such election. Shareholders shall take
action by the affirmative vote of a majority of the votes cast on the matter,
except (i) in the case of the election of directors which requires only a
plurality of all the votes cast at a meeting at which a quorum is present; and
(ii) as otherwise provided in the 1940 Act, the charter, the terms of any series
of preferred shares or the bylaws.
The Massachusetts Statute does not contain a provision which defines a
quorum for taking action. However, unless a larger number is required by the
1940 Act, the Massachusetts Declaration of Investment Trust provides that 10% of
the shares entitled to vote, whether in person or proxy, shall constitute a
quorum at a shareholders' meeting. Pursuant to the bylaws of Investment Trust,
when a quorum is present at any meeting, a majority of the shares voted shall
decide any questions and a plurality shall elect a trustee, unless a larger vote
is required under the 1940 Act.
Under the Massachusetts Declaration of Florida Fund, the quorum and
voting requirements are the same as those described above for its corresponding
New Corporation.
Shareholders' Meetings. Under the Maryland Code, annual shareholders'
meetings of a registered investment company are not required if the charter or
bylaws of the company so provide; however, an annual meeting is required to be
held when the 1940 Act requires the election of directors to be acted upon by
shareholders. The bylaws of the New Corporation corresponding to Investment
Trust are consistent with the Maryland Code. There is no provision in the
Massachusetts Statute relating to annual shareholders' meetings, and neither the
Massachusetts Declarations nor the bylaws of Investment Trust require an annual
shareholders' meeting. The bylaws of the New Corporation corresponding to the
Florida Fund require an annual shareholders' meeting to be held. The common
shares of the Florida Fund are traded on the American Stock Exchange ("AMEX")
and, under the AMEX rules and the Fund's bylaws, the Florida Fund is required to
hold an annual shareholders' meeting.
With respect to special meetings of shareholders, the bylaws of the New
Corporations, pursuant to the Maryland Code, provide that special meetings may
be called by the chairman, president or a majority of the members of the board
of directors and shall be called by the secretary upon the written request of
the holders of at least 10% of all shares issued and outstanding and entitled to
vote at the meeting. There is no comparable provision in the Massachusetts
Statute relating to special meetings of shareholders. However, the Massachusetts
Declaration of Investment Trust permits the trustees to call a meeting of the
shareholders from time to time for taking any action upon any matter deemed by
the trustees to be necessary or desirable. The special meeting requirement for
the Florida Fund is the same as that described above for its corresponding New
Corporation, except that special meetings may be called by two or more trustees
instead of requiring action by a majority of the directors of the corresponding
New Corporation.
Action Without a Shareholders' Meeting. Under the Maryland Code, any
action required to be approved at a meeting of the shareholders may also be
approved by the unanimous written consent of the shareholders entitled to vote
at such meeting.
There is no specific provision in the Massachusetts Statute relating to
shareholder action absent a meeting. The Massachusetts Declarations, however,
contain a provision relating to written consent for shareholder actions. Under
the Massachusetts Declaration of Investment Trust, any action by shareholders
that may be taken at a meeting also may be taken by written action if a majority
of the shareholders entitled to vote on the matter and/or holding a majority of
the shares of a series or class entitled to vote separately on the matter
consent in writing and the consents are filed with the records of the
shareholders' meetings. The Maryland Code, therefore, effectively prevents
shareholders from taking action without a meeting compared to the Massachusetts
Declaration of Investment Trust. Under the Massachusetts Declaration of Florida
Fund, any action required or permitted to be taken at a meeting of the
shareholders may be taken without a meeting by written action signed by all of
the shareholders entitled to vote on that action. Accordingly, the requirement
of the Florida Fund for actions taken without a meeting are the same as that
described above for its corresponding New Corporation.
Record Date. The Maryland Code requires that the record date for
determining which shareholders are entitled to notice of a meeting, to vote at a
meeting, or to certain other rights, such as the record date for the payment of
dividends, may be not more than 90 days and not less than 10 days before the
date on which the meeting or other action requiring determination will be taken.
The bylaws allow the New Corporations to set a date not more than 90 days, and
not less than 10 days in the case of the New Corporation corresponding to the
Florida Fund, before a meeting for determining which shareholders are entitled
to notice of a meeting, to vote at the meeting or to certain other rights.
There is no comparable provision in the Massachusetts Statute regarding
record dates for shareholders entitled to notice of a meeting or to vote at a
meeting. The Massachusetts Declaration for Investment Trust and the bylaws for
the Florida Fund permit the trustees from time to time to set the record date
for making shareholder determinations, which shall not be more than 60 days for
Investment Trust and not more than 90 days for Florida Fund from the date of the
meeting or other action requiring determination.
Notice of Meetings. The Maryland Code requires that notice of each
shareholders' meeting be given to each shareholder entitled to vote at the
meeting and such notice must be given no more than 90 days and not less than 10
days before a meeting. Although a specific time period for notice is not stated
in the bylaws of the New Corporations, the Maryland Code's notice limits are
stated in the bylaws of the New Corporations.
There is no shareholder meeting notice provision in the Massachusetts
Statute. Under the Massachusetts Declaration for Investment Trust, notice of a
shareholders' meeting must be given to shareholders at least 7 days before a
meeting. Under the Massachusetts Declaration and bylaws for Florida Fund, notice
of a shareholders' meeting must be given to each shareholder entitled to vote no
less than 10 days and no more than 60 days prior to the meeting.
Shareholder Rights to Inspection. The Maryland Code provides that
during usual business hours a shareholder may inspect and copy the following
corporate documents: bylaws; minutes of shareholders' meetings; annual
statements of affairs; and voting trust agreements. Moreover, one or more
persons who together are, and for at least six months have been, shareholders of
record of at least five percent of the outstanding stock of any class are
entitled to inspect and copy the corporation's books of account and stock ledger
and to review a statement of affairs and a list of shareholders.
There is no provision in the Massachusetts Statute relating to the
inspection of trust records by the beneficial owners. The Massachusetts
Declarations and bylaws of the Massachusetts Trusts do not contain provisions
relating to the beneficial owners' right of inspection.
Dividends and Other Distributions. The Maryland Code allows the payment
of a dividend or other distribution unless, after giving effect to the dividend
or other distribution (1) the corporation would not be able to pay its debts as
they become due in the usual course of business or (2) the corporation's total
assets would be less than the corporation's total liabilities plus (unless the
corporation's charter provides otherwise, which the charter of the New
Corporation corresponding to the Florida Fund does) the amount that would be
needed, if the corporation were to be dissolved at the time of the distribution,
to satisfy the preferential rights upon dissolution of shareholders whose
preferential rights upon dissolution are superior to those receiving the
distribution.
The Massachusetts Statute does not contain any statutory limitations on
the payment of dividends and other distributions.
Shareholder/Beneficial Owner Liability. As a general matter, the
shareholders of a Maryland corporation are not liable for the obligations of the
corporation. Under the Maryland Code, a shareholder of a Maryland corporation
may, however, be liable in an amount of any distribution he or she accepts
knowing that the distribution was made in violation of the corporation's charter
or the Maryland Code.
The Massachusetts Statute does not include an express provision
relating to the limitation of liability of the beneficial owners of a business
trust. The beneficial owners of a Massachusetts business trust potentially could
be held personally liable for obligations of the trust. The Massachusetts
Declaration of Investment Trust provides, however, that neither the
Massachusetts Trusts nor the trustees shall have the power to bind personally
any shareholder who does not personally agree to such an obligation. With
respect to Florida Fund, the Massachusetts Declaration provides that no personal
liability shall attach to any shareholder or former shareholder of the Florida
Fund and neither the trustees nor any officer, employee or agent of the Florida
Fund shall have any power to bind any shareholder personally or to call upon any
shareholder for the payment of any money or assessment other than by the
shareholder's agreement.
The Massachusetts Declarations also provide that no shareholder shall
be personally liable for any claims of third parties against the Massachusetts
Trusts or any series. Therefore, the terms of the Massachusetts Declarations
prohibit third parties from holding a shareholder personally liable for any
claim.
Director/Trustee Liability. The standard of conduct for directors of a
Maryland corporation is governed by the Maryland Code. The director of a
Maryland corporation is required to perform his or her duties in good faith, in
a manner that he or she reasonably believes to be in the best interests of the
corporation, and with the care that an ordinarily prudent person in a like
position would use under similar circumstances. To the extent that a director
performs his or her duties as required, he or she will be protected from
liability by reason of having been a director. Under the Maryland Code, if it is
established that a director did not perform his or her duties as required by the
Maryland Code, the director who votes or assents to a distribution made in
violation of the Maryland Code or the charter may be personally liable to the
corporation for the amount of the distribution that exceeds what could have been
made pursuant to the Maryland Code or the charter.
The Massachusetts Statute does not include an express provision
limiting the liability of the trustees of a Massachusetts business trust. The
trustees of a Massachusetts business trust potentially could be held liable for
obligations of the trust. However, the Massachusetts Declarations do provide
that the trustees shall not be responsible for any neglect or wrongdoing of any
officer, agent or employee, manager, or principal underwriter of the Trust, nor
for the act or omission of another trustee. The Massachusetts Declaration of
Florida Fund specifically states that no personal liability for any debt or
obligation of the Trust shall attach to any trustee. Furthermore, the
Massachusetts Declarations provide that neither the trustees nor any of the
trust's officers, employees or agents, shall be personally liable for any claims
by third parties against the Massachusetts Trusts or any series of shares. A
trustee also will not be held liable for any note, bond, contract, instrument,
certificate or undertaking made or issued on behalf of the Trust.
Consistent with the provisions of the 1940 Act, nothing in the charters
of the New Corporations or the Massachusetts Declarations protect the directors
or trustees against any liability to which the director or trustee would
otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of their
office.
Indemnification. There is no provision in the Maryland Code relating to
indemnification of shareholders. The charters and bylaws of the New Corporations
do not contain provisions relating to indemnification of shareholders.
Generally, shareholders of a Maryland corporation are not liable for the
obligations of the corporation.
The Maryland Code permits indemnification of directors and officers.
Under the Maryland Code, this right may be limited by the charter or bylaws. The
charters of the New Corporations require indemnification of officers and
directors to the fullest extent permitted by Maryland law and the 1940 Act.
Under the Maryland Code, indemnification is not permitted if it is
established that: (i) the act or omission of the director was material to the
matter giving rise to the proceeding and was committed in bad faith or was the
result of active and deliberate dishonesty; or (ii) the director received an
improper personal benefit in money, property, or services; or (iii) in the case
of a criminal proceeding, the director had no reasonable cause to believe that
the act or omission was unlawful. Under the Maryland Code, unless the charter
provides otherwise, indemnification against reasonable expenses incurred by a
director is required for a director who is successful, on the merits or
otherwise, in the defense of a proceeding to which he is made a party by reason
of his service in such capacity.
The charter of each New Corporation provides that the New Corporation
shall not indemnify any officer or director for any liability arising from the
willful misfeasance, bad faith, gross negligence, or reckless disregard of the
duties involved in the conduct of such person's office.
The Massachusetts Statute does not contain a specific provision
addressing the indemnification of shareholders. The Massachusetts Declarations
do, however, provide that if a shareholder is held personally liable solely by
reason of being a shareholder, the shareholder shall be held harmless from and
indemnified against all loss and expenses arising from such liability. The
shareholders are to be indemnified out of the assets of the trust, except that
with respect to Investment Trust, the shareholder is to be indemnified out of
the assets of the particular series of shares of which the shareholder is or was
a shareholder.
The Massachusetts Statute does not contain a specific provision
addressing the indemnification of trustees and officers. The Massachusetts
Declarations do, however, contain provisions relating to the indemnification of
trustees and officers. Under the Massachusetts Declaration for Investment Trust,
the Trust shall indemnify trustees or officers against all liabilities and
expenses, including satisfaction of judgments, in compromise or as fines, and
penalties, and counsel fees incurred in connection with the defense or
disposition of an action. Under the Massachusetts Declaration for Florida Fund,
indemnification of trustees and officers is provided to the fullest extent
permitted by law against liability and against all expenses reasonably incurred
or paid by such trustee in connection with any claim, action, suit or
proceeding. Consistent with the provisions of the 1940 Act, indemnification for
willful misfeasance, bad faith, gross negligence or reckless disregard of the
trustees' duties is specifically excluded under both Massachusetts Declarations.
EXHIBIT N
Form of Plan of Liquidation and Dissolution
The following Plan of Liquidation and Dissolution ("Plan") of U.S. Government
Money Fund (the "Fund"), a series of Delaware Group Limited-Term Government
Funds, Inc., a corporation organized and existing under the laws of the State of
Maryland and an open-end management investment company registered under the
Investment Company Act of 1940, as amended ("1940 Act"), is intended to
accomplish the complete liquidation and dissolution of the Fund in conformity
with the laws of the State of Maryland.
WHEREAS, on September 17, 1998, the Fund's Board of Directors
unanimously determined that it is in the best interest of the Fund and its
shareholders to liquidate and dissolve the Fund and has considered and adopted
this Plan as the method of liquidating and dissolving the Fund and has directed
that this Plan be submitted to shareholders of the Fund for approval;
NOW, THEREFORE, the liquidation and dissolution of the Fund shall be
carried out in the manner hereinafter set forth:
Effective Date of Plan. The Plan shall be and become effective only
upon the approval, by the affirmative vote of a majority of all votes entitled
to be cast. The day of such approval by shareholders is hereinafter called the
"Effective Date."
1. Dissolution. As promptly as practicable, the Fund shall be
dissolved in accordance with the laws of the State of Maryland.
2. Cessation of Business. After the Effective Date of the Plan, the
Fund shall cease its business and shall not engage in any business activities
except for the purposes of winding up its business and affairs, preserving the
value of its assets and distributing its remaining assets of each class ratably
among the shareholders of the outstanding shares of that class, in accordance
with the provisions of the Plan, after discharging or making reasonable
provision for the Fund's liabilities.
3. Restriction of Transfer and Redemption of Shares. The proportionate
interests of shareholders in the assets of the Fund shall be fixed on the basis
of their respective holdings at the close of business on the Effective Date of
the Plan. On the Effective Date, the books of the Fund shall be closed.
Thereafter, unless the books are reopened because the Plan cannot be carried
into effect or because the Plan is abandoned by the Board of Directors, the
shareholders' respective interests in the Fund's assets shall not be
transferable by the request for redemption, the negotiation of share
certificates or otherwise.
4. Liquidation of Assets and Payment of Debts. As soon as is reasonable
and practicable after the Effective Date, all portfolio securities of the Fund
shall be converted to cash or cash equivalents. As soon as practicable after the
Effective Date, the Fund shall pay, or make reasonable provision to pay, in full
all claims and obligations, including all contingent, conditional or unmatured
claims and obligations, known to the Fund and all claims and obligations which
are known to the Fund but for which the identity of the claimant is unknown.
5. Liquidating Distribution. As soon as possible after the Effective
Date, and in any event within [_____] days thereafter, the Fund shall mail to
each shareholder of record on the Effective Date: (1) a liquidating distribution
equal to the shareholder's proportionate interest in the net assets of the Fund;
and (2) information concerning the sources of the liquidating distribution. Upon
the mailing of the liquidating distribution, all outstanding certificated shares
of the Fund will be deemed canceled. Shareholders in possession of certificated
shares of the Fund will not be required to surrender their certificates to
complete the liquidating distribution. Any accrued income or gains will also be
distributed as part of the liquidating distribution. The Fund will give
shareholders a statement indicating the amount of income or gains included in
the distribution and reportable for tax purposes as part of the liquidating
distribution. Such income or gains will be reportable for tax purposes in
addition to any gain or loss recognized by the shareholder in the redemption of
the shareholder's shares and in addition to any distributions previously made.
6. Management and Expenses of the Fund Subsequent to the Liquidating
Distribution. The Fund shall pay the expenses incurred in carrying out this Plan
including, but not limited to, printing, legal, accounting, custodian and
transfer agency fees, and the expenses of reports to or meeting of shareholders.
7. Filing of Articles Supplementary. Upon completion of the Liquidating
Distribution, the Board of Directors shall cause articles supplementary to be
filed in accordance with Section 2-208 of the General Corporation Law of
Maryland.
8. Power of Board of Directors. The Board, and subject to authorization
by the Directors, the officers, shall have authority to do or authorize any acts
and things as provided for in the Plan and as they may consider necessary or
desirable to carry out the purposes of the Plan, including the execution and
filing of certificates, tax returns and other papers. The death, resignation or
disability of any director or any officer of the Fund shall not impair the
authority of the surviving or remaining directors or officers to exercise any of
the powers provided for in the Plan. The Board of Directors shall have the
authority to authorize variations from or amendments of the provisions of the
Plan as may be necessary or appropriate to effect the liquidation and
dissolution of the Fund, and the distribution of its net assets to shareholders
in accordance with the laws of the State of Maryland, or to abandon the Plan.
Date: _________________, 1998