DELAWARE GROUP EQUITY FUNDS II, INC.
DIVERSIFIED VALUE FUND
DISTRIBUTION AGREEMENT
Distribution Agreement (the "Agreement") made as of this 14th day of
September, 1998 by and between DELAWARE GROUP EQUITY FUNDS II, INC., a Maryland
Corporation (the "Fund"), for the DIVERSIFIED VALUE FUND series (the "Series"),
and DELAWARE DISTRIBUTORS, L.P. (the "Distributor"), a Delaware limited
partnership.
WITNESSETH
WHEREAS, the Fund is an investment company regulated by Federal and
State regulatory bodies, and
WHEREAS, the Distributor is engaged in the business of promoting the
distribution of the securities of investment companies and, in connection
therewith and acting solely as agent for such investment companies and not as
principal, advertising, promoting, offering and selling their securities to the
public, and
WHEREAS, the Fund desires to enter into an agreement with the
Distributor on behalf of the Series, pursuant to which the Distributor shall
serve as the national distributor of the Series' Diversified Value Fund A Class
("Class A Shares"), Diversified Value Fund B Class ("Class B Shares"),
Diversified Value Fund C Class ("Class C Shares"), and Diversified Value Fund
Institutional Class ("Institutional Class Shares"), which Series and classes may
do business under these or such other names as the Board of Directors may
designate from time to time, on the terms and conditions set forth below.
NOW, THEREFORE, the parties hereto, intending to be legally bound
hereby, agree as follows:
1. The Fund hereby engages the Distributor to promote the
distribution of the Series' shares and, in connection
therewith and as agent for the Fund and not as principal, to
advertise, promote, offer and sell the Series' shares to the
public.
2. (a) The Distributor agrees to serve as distributor of
the Series' shares and, as agent for the Fund and
not as principal, to advertise, promote and use its
best efforts to sell the Series' shares wherever
their sale is legal, either through dealers or
otherwise, in such places and in such manner, not
inconsistent with the law and the provisions of this
Agreement and the Fund's Registration Statement
under the Securities Act of 1933, including the
Prospectuses and the Statement of Additional
Information contained therein, as may be mutually
determined by the Fund and the Distributor from time
to time.
(b) For the Institutional Class Shares, the Distributor
will bear all costs of financing any activity which
is primarily intended to result in the sale of that
class of shares, including, but not limited to,
advertising, compensation of underwriters, dealers
and sales personnel, the printing and mailing of
sales literature and distribution of that class of
shares.
(c) For its services as agent for the Class A Shares,
Class B Shares, and Class C Shares, the Distributor
shall be entitled to compensation on each sale or
redemption, as appropriate, of shares of such classes
equal to any front-end or deferred sales charge
described in the Prospectus from time to time and may
allow concessions to dealers in such amounts and on
such terms as are therein set forth.
(d) For the Class A Shares, Class B Shares, and Class C
Shares, the Fund shall, in addition, compensate the
Distributor for its services as provided in the
Distribution Plan as adopted on behalf of the Class A
Shares, Class B Shares, and Class C Shares,
respectively, pursuant to Rule 12b-1 under the
Investment Company Act of 1940 (the "Plans"), copies
of which as presently in force are attached hereto
as, respectively, Exhibit "X," "X," and "C."
3. (a) The Fund agrees to make available for sale by the
Fund through the Distributor all or such part of the
authorized but unissued shares of the Series as the
Distributor shall require from time to time and,
except as provided in Paragraph 3(b) hereof, the Fund
will not sell Series' shares other than through the
efforts of the Distributor.
(b) The Fund reserves the right from time to time (1) to
sell and issue shares other than for cash; (2) to
issue shares in exchange for substantially all of
the assets of any corporation or trust, or in
exchange of shares of any corporation or trust; (3)
to pay stock dividends to its shareholders, or to
pay dividends in cash or stock at the option of its
stockholders, or to sell stock to existing
stockholders to the extent of dividends payable from
time to time in cash, or to split up or combine its
outstanding shares of common stock; (4) to offer
shares for cash to its stockholders as a whole, by
the use of transferable rights or otherwise, and to
sell and issue shares pursuant to such offers; and
(5) to act as its own distributor in any
jurisdiction in which the Distributor is not
registered as a broker-dealer.
4. The Fund warrants the following:
(a) The Fund is, or will be, a properly registered
investment company, and any and all Series' shares
which it will sell through the Distributor are, or
will be, properly registered with the Securities and
Exchange Commission ("SEC").
(b) The provisions of this Agreement do not violate the
terms of any instrument by which the Fund is bound,
nor do they violate any law or regulation of any body
having jurisdiction over the Fund or its property.
5. (a) The Fund will supply to the Distributor a conformed
copy of the Registration Statement and all
amendments thereto, including all exhibits and each
Prospectus and Statement of Additional Information.
(b) The Fund will register or qualify the Series' shares
for sale in such states as is deemed desirable.
(c) The Fund, without expense to the Distributor:
(1) will give and continue to give such
financial statements and other information
as may be required by the SEC or the proper
public bodies of the states in which the
Series' shares may be qualified;
(2) from time to time, will furnish to the
Distributor as soon as reasonably
practicable true copies of its periodic
reports to stockholders;
(3) will promptly advise the Distributor in
person or by telephone or telegraph, and
promptly confirm such advice in writing, (a)
when any amendment or supplement to the
Registration Statement becomes effective,
(b) of any request by the SEC for amendments
or supplements to the Registration Statement
or the Prospectuses or for additional
information, and (c) of the issuance by the
SEC of any Stop Order suspending the
effectiveness of the Registration Statement,
or the initiation of any proceedings for
that purpose;
(4) if at any time the SEC shall issue any Stop
Order suspending the effectiveness of the
Registration Statement, will make every
reasonable effort to obtain the lifting of
such order at the earliest possible moment;
(5) will from time to time, use its best effort
to keep a sufficient supply of Series'
shares authorized, any increases being
subject to the approval of shareholders as
may be required;
(6) before filing any further amendment to the
Registration Statement or to any Prospectus,
will furnish to the Distributor copies of
the proposed amendment and will not, at any
time, whether before or after the effective
date of the Registration Statement, file any
amendment to the Registration Statement or
supplement to any Prospectus of which the
Distributor shall not previously have been
advised or to which the Distributor shall
reasonably object (based upon the accuracy
or completeness thereof) in writing;
(7) will continue to make available to its
stockholders (and forward copies to the
Distributor) of such periodic, interim and
any other reports as are now, or as
hereafter may be, required by the provisions
of the Investment Company Act of 1940; and
(8) will, for the purpose of computing the
offering price of Series' shares, advise the
Distributor within one hour after the close
of the New York Stock Exchange (or as soon
as practicable thereafter) on each business
day upon which the New York Stock Exchange
may be open of the net asset value per share
of the Series' shares of common stock
outstanding, determined in accordance with
any applicable provisions of law and the
provisions of the Articles of Incorporation,
as amended, of the Fund as of the close of
business on such business day. In the event
that prices are to be calculated more than
once daily, the Fund will promptly advise
the Distributor of the time of each
calculation and the price computed at each
such time.
6. The Distributor agrees to submit to the Fund, prior to its
use, the form of all sales literature proposed to be generally
disseminated by or for the Distributor, all advertisements
proposed to be used by the Distributor, all sales literature
or advertisements prepared by or for the Distributor for such
dissemination or for use by others in connection with the sale
of the Series' shares, and the form of dealers' sales contract
the Distributor intends to use in connection with sales of the
Series' shares. The Distributor also agrees that the
Distributor will submit such sales literature and
advertisements to the NASD, SEC or other regulatory agency as
from time to time may be appropriate, considering practices
then current in the industry. The Distributor agrees not to
use such form of dealers' sales contract or to use or to
permit others to use such sales literature or advertisements
without the written consent of the Fund if any regulatory
agency expresses objection thereto or if the Fund delivers to
the Distributor a written objection thereto.
7. The purchase price of each share sold hereunder shall be the
offering price per share mutually agreed upon by the parties
hereto and, as described in the Fund's Prospectuses, as
amended from time to time, determined in accordance with any
applicable provision of law, the provisions of its Articles of
Incorporation and the Conduct Rules of the National
Association of Securities Dealers, Inc.
8. The responsibility of the Distributor hereunder shall be
limited to the promotion of sales of Series' shares. The
Distributor shall undertake to promote such sales solely as
agent of the Fund, and shall not purchase or sell such shares
as principal. Orders for Series' shares and payment for such
orders shall be directed to the Fund's agent, Delaware Service
Company, Inc. for acceptance on behalf of the Fund. The
Distributor is not empowered to approve orders for sales of
Series' shares or accept payment for such orders. Sales of
Series' shares shall be deemed to be made when and where
accepted by Delaware Service Company, Inc. on behalf of the
Fund.
9. With respect to the apportionment of costs between the Fund
and the Distributor of activities with which both are
concerned, the following will apply:
(a) The Fund and the Distributor will cooperate in
preparing the Registration Statements, the
Prospectuses, the Statement of Additional
Information, and all amendments, supplements and
replacements thereto. The Fund will pay all costs
incurred in the preparation of the Fund's
Registration Statement, including typesetting, the
costs incurred in printing and mailing Prospectuses
and Annual, Semi-Annual and other financial reports
to its own shareholders and fees and expenses of
counsel and accountants.
(b) The Distributor will pay the costs incurred in
printing and mailing copies of Prospectuses to
prospective investors.
(c) The Distributor will pay advertising and promotional
expenses, including the costs of literature sent to
prospective investors.
(d) The Fund will pay the costs and fees incurred in
registering or qualifying the Series' shares with the
various states and with the SEC.
(e) The Distributor will pay the costs of any additional
copies of Fund financial and other reports and other
Fund literature supplied to the Distributor by the
Fund for sales promotion purposes.
10. The Distributor may engage in other business, provided such
other business does not interfere with the performance by the
Distributor of its obligations under this Agreement.
11. The Fund agrees to indemnify, defend and hold harmless from
the assets of the Series the Distributor and each person, if
any, who controls the Distributor within the meaning of
Section 15 of the Securities Act of 1933, from and against any
and all losses, damages, or liabilities to which, jointly or
severally, the Distributor or such controlling person may
become subject, insofar as the losses, damages or liabilities
arise out of the performance of its duties hereunder, except
that the Fund shall not be liable for indemnification of the
Distributor or any controlling person thereof for any
liability to the Fund or its security holders to which they
would otherwise be subject by reason of willful misfeasance,
bad faith, or gross negligence in the performance of their
duties under this Agreement.
12. Copies of financial reports, Registration Statements and
Prospectuses, as well as demands, notices, requests, consents,
waivers, and other communications in writing
which it may be necessary or desirable for either party to
deliver or furnish to the other will be duly delivered or
furnished, if delivered to such party at its address shown
below during regular business hours, or if sent to that party
by registered mail or by prepaid telegram filed with an office
or with an agent of Western Union or another nationally
recognized telegraph service, in all cases within the time or
times herein prescribed, addressed to the recipient at 0000
Xxxxxx Xxxxxx, Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000, or at such
other address as the Fund or the Distributor may designate in
writing and furnish to the other.
13. This Agreement shall not be assigned, as that term is defined
in the Investment Company Act of 1940, by the Distributor and
shall terminate automatically in the event of its attempted
assignment by the Distributor. This Agreement shall not be
assigned by the Fund without the written consent of the
Distributor signed by its duly authorized officers and
delivered to the Fund. Except as specifically provided in the
indemnification provision contained in Paragraph 11 herein,
this Agreement and all conditions and provisions hereof are
for the sole and exclusive benefit of the parties hereto and
their legal successors and no express or implied provision of
this Agreement is intended or shall be construed to give any
person other than the parties hereto and their legal
successors any legal or equitable right, remedy or claim under
or in respect of this Agreement or any provisions herein
contained.
14. (a) This Agreement shall remain in force for a period of
two years from the date hereof and from year to year
thereafter, but only so long as such continuance is
specifically approved at least annually by the Board
of Directors or by vote of a majority of the
outstanding voting securities of the Series and only
if the terms and the renewal thereof 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.
(b) The Distributor may terminate this Agreement on
written notice to the Fund at any time in case the
effectiveness of the Registration Statement shall be
suspended, or in case Stop Order proceedings are
initiated by the SEC in respect of the Registration
Statement and such proceedings are not withdrawn or
terminated within thirty days. The Distributor may
also terminate this Agreement at any time by giving
the Fund written notice of its intention to terminate
the Agreement at the expiration of three months from
the date of delivery of such written notice of
intention to the Fund.
(c) The Fund may terminate this Agreement at any time on
at least thirty days' prior written notice to the
Distributor (1) if proceedings are commenced by the
Distributor or any of its partners for the
Distributor's liquidation or dissolution or the
winding up of the Distributor's affairs; (2) if a
receiver or trustee of the Distributor or any of its
property is appointed and such appointment is not
vacated within thirty days thereafter; (3) if, due to
any
action by or before any court or any federal or state
commission, regulatory body, or administrative agency
or other governmental body, the Distributor shall be
prevented from selling securities in the United
States or because of any action or conduct on the
Distributor's part, sales of the shares are not
qualified for sale. The Fund may also terminate this
Agreement at any time upon prior written notice to
the Distributor of its intention to so terminate at
the expiration of three months from the date of the
delivery of such written notice to the Distributor.
15. The validity, interpretation and construction of this
Agreement, and of each part hereof, will be governed by the
laws of the Commonwealth of Pennsylvania.
16. In the event any provision of this Agreement is determined to
be void or unenforceable, such determination shall not affect
the remainder of the Agreement, which shall continue to be in
force.
DELAWARE DISTRIBUTORS, L.P.
By: DELAWARE DISTRIBUTORS, INC.,
General Partner
Attest:
/s/ Xxxxx X. X'Xxxxxx By: /s/ Xxxxx Xxxxxx
--------------------------------- ---------------------------------
Name: Xxxxx X. X'Xxxxxx Name: Xxxxx Xxxxxx
Title: Assistant Vice President Title: President and CEO
Assistant Secretary
DELAWARE GROUP EQUITY FUNDS II, INC.,
for the DIVERSIFIED VALUE FUND
Attest:
/s/ Xxxxxxx X. Xxxxxxxxxx By: /s/ Xxxxx X. Xxxxx
--------------------------------- ---------------------------------
Name: Xxxxxxx X. Xxxxxxxxxx Name: Xxxxx X. Xxxxx
Title: Assistant Vice President Title: Chairman
Assistant Secretary
EXHIBIT A
DISTRIBUTION PLAN
DELAWARE GROUP EQUITY FUNDS II, INC.
DIVERSIFIED VALUE FUND
DIVERSIFIED VALUE FUND A CLASS
The following Distribution Plan (the "Plan") has been adopted pursuant
to Rule l2b-l under the Investment Company Act of l940 (the "Act") by Delaware
Group Equity Funds II, Inc. (the "Fund"), for the Diversified Value Fund series
(the "Series") on behalf of the Diversified Value Fund A Class ("Class"), which
Fund, Series and Class may do business under these or such other names as the
Board of Directors of the Fund may designate from time to time. The Plan has
been approved by a majority of the Board of Directors, including a majority of
the Directors who are not interested persons of the Fund and who have no direct
or indirect financial interest in the operation of the Plan or in any agreements
related thereto ("non-interested Directors"), cast in person at a meeting called
for the purpose of voting on such Plan. Such approval by the Directors included
a determination that in the exercise of reasonable business judgment and in
light of their fiduciary duties, there is a reasonable likelihood that the Plan
will benefit the Series and shareholders of the Class. The Plan has been adopted
prior to any public offering of the Class.
The Fund is a corporation organized under the laws of the State of
Maryland, is authorized to issue different series and classes of securities and
is an open-end management investment company registered under the Act. Delaware
Management Company, a series of Delaware Management Business Trust, serves as
the Series' investment adviser and manager pursuant to an Investment Management
Agreement. Delaware Service Company, Inc. serves as the Series' shareholder
servicing, dividend disbursing and transfer agent. Delaware Distributors, L.P.
(the "Distributor") is the principal underwriter and national distributor for
the Series' shares, including shares of the Class, pursuant to the Distribution
Agreement between the Distributor and the Fund on behalf of the Series
("Distribution Agreement").
The Plan provides that:
l. The Fund shall pay to the Distributor a monthly fee not to exceed
0.30% (3/10 of l%) per annum of the Series' average daily net assets represented
by shares of the Class (the "Maximum Amount") as may be determined by the Fund's
Board of Directors from time to time. Such monthly fee shall be reduced by the
aggregate sums paid by the Fund on behalf of the Series to persons other than
broker-dealers (the "Service Providers") who may, pursuant to servicing
agreements, provide to the Series services in the Series' marketing of shares of
the Class.
2. (a) The Distributor shall use the monies paid to it pursuant to
paragraph l above to furnish, or cause or encourage others to furnish, services
and incentives in connection with the promotion, offering and sale of Class
shares and, where suitable and appropriate, the retention of Class shares by
shareholders.
(b) The Service Providers shall use the monies paid respectively to
them to reimburse themselves for the actual costs they have incurred in
confirming that their customers have received the Prospectus and Statement of
Additional Information, if applicable, and as a fee for (l) assisting such
customers in maintaining proper records with the Fund, (2) answering questions
relating to their respective accounts, and (3) aiding in maintaining the
investment of their respective customers in the Class.
3. The Distributor shall report to the Fund at least monthly on the
amount and the use of the monies paid to it under the Plan. The Service
Providers shall inform the Fund monthly and in writing of the amounts each
claims under the Plan; both the Distributor and the Service Providers shall
furnish the Board of Directors of the Fund with such other information as the
Board may reasonably request in connection with the payments made under the Plan
and the use thereof by the Distributor and the Service Providers, respectively,
in order to enable the Board to make an informed determination of the amount of
the Fund's payments and whether the Plan should be continued.
4. The officers of the Fund shall furnish to the Board of Directors of
the Fund, for their review, on a quarterly basis, a written report of the
amounts expended under the Plan and the purposes for which such expenditures
were made.
5. This Plan shall take effect at such time as the Distributor shall
notify the Fund in writing of the commencement of the Plan (the "Commencement
Date"); thereafter, the Plan shall continue in effect for a period of more than
one year from the Commencement Date only so long as such continuance is
specifically approved at least annually by a vote of the Board of Directors of
the Fund, and of the non-interested Directors, cast in person at a meeting
called for the purpose of voting on such Plan.
6. (a) The Plan may be terminated at any time by vote of a majority of
the non-interested Directors or by vote of a majority of the outstanding voting
securities of the Class.
(b) The Plan may not be amended to increase materially the amount to
be spent for distribution pursuant to paragraph l hereof without approval by the
shareholders of the Class.
7. All material amendments to this Plan shall be approved by the
non-interested Directors in the manner described in paragraph 5 above.
8. So long as the Plan is in effect, the selection and nomination of
the Fund's non-interested Directors shall be committed to the discretion of such
non-interested Directors.
9. The definitions contained in Sections 2(a)(19) and 2(a)(42) of the
Act shall govern the meaning of "interested person(s)" and "vote of a majority
of the outstanding voting securities," respectively, for the purposes of this
Plan.
This Plan shall take effect on the Commencement Date, as previously
defined.
September 14, 1998
EXHIBIT B
DISTRIBUTION PLAN
DELAWARE GROUP EQUITY FUNDS II, INC.
DIVERSIFIED VALUE FUND
DIVERSIFIED VALUE FUND B CLASS
The following Distribution Plan (the "Plan") has been adopted pursuant
to Rule 12b-1 under the Investment Company Act of 1940 (the "Act") by Delaware
Group Equity Funds II, Inc. (the "Fund"), for the Diversified Value Fund series
(the "Series") on behalf of the Diversified Value Fund B Class (the "Class"),
which Fund, Series and Class may do business under these or such other names as
the Board of Directors of the Fund may designate from time to time. The Plan has
been approved by a majority of the Board of Directors, including a majority of
the Directors who are not interested persons of the Fund and who have no direct
or indirect financial interest in the operation of the Plan or in any agreements
related thereto ("non-interested Directors"), cast in person at a meeting called
for the purpose of voting on such Plan. Such approval by the Directors included
a determination that in the exercise of reasonable business judgment and in
light of their fiduciary duties, there is a reasonable likelihood that the Plan
will benefit the Series and shareholders of the Class. The Plan has been adopted
prior to any public offering of the Class.
The Fund is a corporation organized under the laws of the State of
Maryland, is authorized to issue different series and classes of securities and
is an open-end management investment company registered under the Act. Delaware
Management Company, a series of Delaware Management Business Trust, serves as
the Series' investment adviser and manager pursuant to an Investment Management
Agreement. Delaware Service Company, Inc. serves as the Series' shareholder
servicing, dividend disbursing and transfer agent. Delaware Distributors, L.P.
(the "Distributor") is the principal underwriter and national distributor for
the Series' shares, including shares of the Class, pursuant to the Distribution
Agreement between the Distributor and the Fund on behalf of the Series
("Distribution Agreement").
The Plan provides that:
1. (a) The Fund shall pay to the Distributor a monthly fee not to
exceed 0.75% (3/4 of 1%) per annum of the Series' average daily net assets
represented by shares of the Class as may be determined by the Fund's Board of
Directors from time to time.
(b) In addition to the amounts described in (a) above, the Fund
shall pay (i) to the Distributor for payment to dealers or others, or (ii)
directly to others, an amount not to exceed 0.25% (1/4 of 1%) per annum of the
Series' average daily net assets represented by shares of the Class, as a
service fee pursuant to dealer or servicing agreements.
2. (a) The Distributor shall use the monies paid to it pursuant to
paragraph 1(a) above to assist in the distribution and promotion of shares of
the Class. Payments made to the Distributor under the Plan may be used for,
among other things, preparation and distribution of advertisements, sales
literature and prospectuses and reports used for sales purposes, as well as
compensation related to sales and marketing personnel, and holding special
promotions. In addition, such fees may be used to pay for advancing the
commission costs to dealers with respect to the sale of Class shares.
(b) The monies to be paid pursuant to paragraph 1(b) above shall be
used to pay dealers or others for, among other things, furnishing personal
services and maintaining shareholder accounts, which services include confirming
that customers have received the Prospectus and Statement of Additional
Information, if applicable; assisting such customers in maintaining proper
records with the Fund; answering questions relating to their respective
accounts; and aiding in maintaining the investment of their respective customers
in the Class.
3. The Distributor shall report to the Fund at least monthly on the
amount and the use of the monies paid to it under paragraph 1(a) above. In
addition, the Distributor and others shall inform the Fund monthly and in
writing of the amounts paid under paragraph 1(b) above; both the Distributor and
any others receiving fees under the Plan shall furnish the Board of Directors of
the Fund with such other information as the Board may reasonably request in
connection with the payments made under the Plan and the use thereof by the
Distributor and others in order to enable the Board to make an informed
determination of the amount of the Fund's payments and whether the Plan should
be continued.
4. The officers of the Fund shall furnish to the Board of Directors of
the Fund, for their review, on a quarterly basis, a written report of the
amounts expended under the Plan and the purposes for which such expenditures
were made.
5. This Plan shall take effect at such time as the Distributor shall
notify the Fund of the commencement of the Plan (the "Commencement Date");
thereafter, the Plan shall continue in effect for a period of more than one year
from the Commencement Date only so long as such continuance is specifically
approved at least annually by a vote of the Board of Directors of the Fund, and
of the non-interested Directors, cast in person at a meeting called for the
purpose of voting on such Plan.
6. (a) The Plan may be terminated at any time by vote of a majority of
the non-interested Directors or by vote of a majority of the outstanding voting
securities of the Class.
(b) The Plan may not be amended to increase materially the amount to
be spent for distribution pursuant to paragraph 1 hereof without approval by the
shareholders of the Class.
7. All material amendments to this Plan shall be approved by the
non-interested Directors in the manner described in paragraph 5 above.
8. So long as the Plan is in effect, the selection and nomination of
the Fund's non-interested Directors shall be committed to the discretion of such
non-interested Directors.
9. The definitions contained in Sections 2(a)(19) and 2(a)(42) of the
Act shall govern the meaning of "interested person(s)" and "vote of a majority
of the outstanding voting securities," respectively, for the purposes of this
Plan.
This Plan shall take effect on the Commencement Date, as previously
defined.
September 14, 1998
EXHIBIT C
DISTRIBUTION PLAN
DELAWARE GROUP EQUITY FUNDS II, INC.
DIVERSIFIED VALUE FUND
DIVERSIFIED VALUE FUND C CLASS
The following Distribution Plan (the "Plan") has been adopted pursuant
to Rule 12b-1 under the Investment Company Act of 1940 (the "Act") by Delaware
Group Equity Funds II, Inc. (the "Fund"), for the Diversified Value Fund series
(the "Series) on behalf of the Diversified Value Fund C Class (the "Class"),
which Fund, Series and Class may do business under these or such other names as
the Board of Directors of the Fund may designate from time to time. The Plan has
been approved by a majority of the Board of Directors, including a majority of
the Directors who are not interested persons of the Fund and who have no direct
or indirect financial interest in the operation of the Plan or in any agreements
related thereto ("non-interested Directors"), cast in person at a meeting called
for the purpose of voting on such Plan. Such approval by the Directors included
a determination that in the exercise of reasonable business judgment and in
light of their fiduciary duties, there is a reasonable likelihood that the Plan
will benefit the Series and shareholders of the Class. The Plan has been adopted
prior to any public offering of the Class.
The Fund is a corporation organized under the laws of the State of
Maryland, is authorized to issue different series and classes of securities and
is an open-end management investment company registered under the Act. Delaware
Management Company, a series of Delaware Management Business Trust, serves as
the Series' investment adviser and manager pursuant to an Investment Management
Agreement. Delaware Service Company, Inc. serves as the Series' shareholder
servicing, dividend disbursing and transfer agent. Delaware Distributors, L.P.
(the "Distributor") is the principal underwriter and national distributor for
the Series' shares, including shares of the Class, pursuant to the Distribution
Agreement between the Distributor and the Fund on behalf of the Series
("Distribution Agreement").
The Plan provides that:
1. (a) The Fund shall pay to the Distributor a monthly fee not to
exceed 0.75% (3/4 of 1%) per annum of the Series' average daily net assets
represented by shares of the Class as may be determined by the Fund's Board of
Directors from time to time.
(b) In addition to the amounts described in paragraph 1(a) above,
the Fund shall pay: (i) to the Distributor for payment to dealers or others or
(ii) directly to others, an amount not to exceed 0.25% (1/4 of 1%) per annum of
the Series' average daily net assets represented by shares of the Class, as a
service fee pursuant to dealer or servicing agreements.
2. (a) The Distributor shall use the monies paid to it pursuant to
paragraph 1(a) above to assist in the distribution and promotion of shares of
the Class. Payments made to the Distributor under the Plan may be used for,
among other things, preparation and distribution of advertisements, sales
literature and prospectuses and reports used for sales purposes, as well as
compensation related to sales and marketing personnel, and holding special
promotions. In addition, such fees may be used to pay for advancing the
commission costs to dealers with respect to the sale of Class shares.
(b) The monies to be paid pursuant to paragraph 1(b) above shall be
used to pay dealers or others for, among other things, furnishing personal
services and maintaining shareholder accounts, which services include confirming
that customers have received the Prospectus and Statement of Additional
Information, if applicable; assisting such customers in maintaining proper
records with the Fund; answering questions relating to their respective
accounts; and aiding in maintaining the investment of their respective customers
in the Class.
3. The Distributor shall report to the Fund at least monthly on the
amount and the use of the monies paid to it under paragraph 1(a) above. In
addition, the Distributor and others shall inform the Fund monthly and in
writing of the amounts paid under paragraph 1(b) above; both the Distributor and
any others receiving fees under the Plan shall furnish the Board of Directors of
the Fund with such other information as the Board may reasonably request in
connection with the payments made under the Plan and the use thereof by the
Distributor and others in order to enable the Board to make an informed
determination of the amount of the Fund's payments and whether the Plan should
be continued.
4. The officers of the Fund shall furnish to the Board of Directors of
the Fund, for their review, on a quarterly basis, a written report of the
amounts expended under the Plan and the purposes for which such expenditures
were made.
5. This Plan shall take effect at such time as the Distributor shall
notify the Fund of the commencement of the Plan (the "Commencement Date");
thereafter, the Plan shall continue in effect for a period of more than one year
from the Commencement Date only so long as such continuance is specifically
approved at least annually by a vote of the Board of Directors of the Fund, and
of the non-interested Directors, cast in person at a meeting called for the
purpose of voting on such Plan.
6. (a) The Plan may be terminated at any time by vote of a majority of
the non-interested Directors or by vote of a majority of the outstanding voting
securities of the Class.
(b) The Plan may not be amended to increase materially the amount to
be spent for distribution pursuant to paragraph 1 hereof without approval by the
shareholders of the Class.
7. All material amendments to this Plan shall be approved by the
non-interested Directors in the manner described in paragraph 5 above.
8. So long as the Plan is in effect, the selection and nomination of
the Fund's non-interested Directors shall be committed to the discretion of such
non-interested Directors.
9. The definitions contained in Sections 2(a)(19) and 2(a)(42) of the
Act shall govern the meaning of "interested person(s)" and "vote of a majority
of the outstanding voting securities," respectively, for the purposes of this
Plan.
This Plan shall take effect on the Commencement Date, as previously
defined.
September 14, 1998
