PHILADELPHIA, Dec. 27 /PRNewswire-FirstCall/ -- Today, Delaware Investments Dividend and Income Fund, Inc. (the "Fund"), a New York Stock Exchange-listed closed-end fund trading under the symbol "DDF," declared a dividend of $0.08 per share. The dividend is payable January 26, 2007 to shareholders of record at the close of business on January 12, 2007. The ex-dividend date will be January 10, 2007.
The Fund is a diversified closed-end fund. The primary investment objective is to seek high current income; capital appreciation is a secondary objective. The Fund seeks to achieve its objectives by investing, under normal circumstances, at least 65 percent of its total assets in income-generating equity securities, including dividend-paying common stocks, convertible securities, preferred stocks and other equity-related securities. Up to 35 percent of the Fund's total assets may be invested in non-convertible debt securities consisting primarily of high-yield, high-risk corporate bonds. In addition, the Fund utilizes leveraging techniques in an attempt to obtain a higher return for the Fund. There is no assurance that the Fund will achieve its investment objectives.
In 1995, the Fund implemented a managed distribution policy. Under the policy, the Fund is managed with a goal of generating as much of the dividend as possible from ordinary income (net investment income and short-term capital gains). The balance of the dividend then comes from long-term capital gains to the extent permitted and, if necessary, a return of capital. In 2002, the Securities and Exchange Commission (the "SEC") granted the Fund an exemption from Section 19(b) of the Investment Company Act of 1940 (the "1940 Act") to allow the Fund to distribute long-term capital gains up to 12 times per year (the "Order"). The Order gave the Fund the ability to characterize a portion of each monthly distribution made pursuant to the Fund's managed distribution policy as long-term capital gain. On the basis of a separate matter, the SEC has recently rescinded the Fund's Order. The Fund has applied for a new Section 19(b) exemptive order ("New Order"). While the application is pending, the Fund's ability to characterize any portion of distributions made pursuant to the Fund's managed distribution policy as long-term capital gains will be limited to the instances permitted by Section 19(b) of the 1940 Act. Additionally, the rescission of the Fund's Order may (but not necessarily will) lead to one or more of the following: (i) a lower monthly distribution amount made pursuant to the Fund's managed distribution policy; (ii) the Fund's share price trading at a greater discount from its net asset value than would otherwise have been the case if the Order were in effect; or (iii) the amount of distributions paid in a given year may be higher than would have been paid when the Order was in effect if some part of the monthly distributions paid by the Fund are classified as returns of capital rather than from long-term capital gains and, in addition to such distributions, the Fund separately pays out its long-term capital gains as permitted by Section 19(b) of the 1940 Act. The preceding issues may be mitigated or eliminated if the Fund receives the New Order in a timely manner, but there is no guarantee of such result.
About Delaware Investments:
Delaware Investments, an affiliate of Lincoln Financial Group, is a Philadelphia-based diversified asset management firm with more than $150 billion in assets under management as of September 30, 2006. Through a broad range of managed accounts and portfolios, mutual funds, retirement accounts, sub-advised funds, education savings plans and other investment products, Delaware Investments provides investment services to individual investors and to institutional investors such as private and public pension funds, foundations, and endowment funds. Delaware Investments is the marketing name for Delaware Management Holdings, Inc. and its subsidiaries. For more information on Delaware Investments, visit the company at http://www.delawareinvestments.com/. Lincoln Financial Group is the marketing name for Lincoln National Corporation and its affiliates. For more information on Lincoln Financial Group, visit http://www.lfg.com/.
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