Exhibit No. EX-99.12.a
___________, 2006
Board of Trustees
Delaware Group Income Funds
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Board of Directors
Lincoln National Income Fund, Inc.
0000 Xxxxxx Xxxxxx
Xxxxxxxxxxxx, XX 00000
Re: Agreement And Plan Of Acquisition (the "Plan"), made as of
the ____ day of __________, 2006, by and among (i) Lincoln
National Income Fund, Inc. ("Acquired Fund"), a corporation
incorporated under the laws of the State of Maryland and a
closed-end management investment company registered under
the Investment Company Act of 1940, as amended ("1940 Act"),
(ii) Delaware Group Income Funds ("Acquiring Trust"), on
behalf of its series Delaware Corporate Bond Fund
("Acquiring Fund"), a statutory trust formed under the laws
of the State of Delaware and an open-end management
investment company registered under the 1940 Act, and (iii)
Delaware Management Company ("DMC"), a series of Delaware
Management Business Trust ("DMBT"), a statutory trust formed
under the laws of the State of
Delaware.
Gentlemen:
You have requested our opinion concerning certain federal income tax
consequences of the reorganization of Acquired Fund (the "Reorganization"),
which will consist of: (i) the acquisition by Acquiring Trust, on behalf of
Acquiring Fund, of substantially all of the property, assets and goodwill of
Acquired Fund in exchange solely for full and fractional shares of beneficial
interest, without par value, of Acquiring Fund - Class A Shares ("Acquiring Fund
Shares"), which are voting securities; (ii) the distribution of Acquiring Fund
Shares to the shareholders of Acquired Fund for their shares of common stock of
Acquired Fund, par value
Board of Trustees, Delaware Group Income Funds
Board of Directors, Lincoln National Income Fund, Inc.
_____________, 2006
Page 2
$0.001 per share ("Acquired Fund Shares"), according to their respective
interests in liquidation of Acquired Fund; and (iii) the dissolution of Acquired
Fund as soon as is practicable after the closing (the "Closing"), all upon and
subject to the terms and conditions of the Plan.
In rendering our opinion, we have reviewed and relied upon: (a) the
Plan, made as of the _____ day of __________, 2006, by and among Acquired Fund,
Acquiring Trust, on behalf of Acquiring Fund, and DMC, a series of DMBT; (b) the
proxy materials provided to shareholders of Acquired Fund in connection with a
Special Meeting of shareholders of Acquired Fund held on ______________, 2006;
(c) certain representations concerning the Reorganization made to us by Acquired
Fund and Acquiring Trust, on behalf of Acquiring Fund, in a letter dated
___________, 2006 (the "Representation Letter"); (d) all other documents,
financial and other reports and corporate minutes we deemed relevant or
appropriate; and (e) such statutes, regulations, rulings and decisions as we
deemed material in rendering this opinion. All terms used herein, unless
otherwise defined, are used as defined in the Plan.
For purposes of this opinion, we have assumed that Acquired Fund, on
the Closing of the Reorganization, satisfies, and immediately following the
Closing, Acquiring Fund will continue to satisfy, the requirements of Subchapter
M of the Internal Revenue Code of 1986, as amended (the "Code"), for
qualification as a regulated investment company.
Based on the foregoing, and provided the Reorganization is carried out
in accordance with the applicable laws of the State of Maryland and State of
Delaware, the terms of the Plan and the statements in the Representation Letter
with regard to matters of fact, it is our opinion that:
1. The acquisition by Acquiring Fund of substantially all of the
assets of Acquired Fund as provided for in the Plan in exchange solely for
Acquiring Fund Shares, followed by the distribution by Acquired Fund to its
shareholders of Acquiring Fund Shares in complete liquidation of Acquired Fund,
will qualify as a reorganization within the meaning of Section 368(a)(1) of the
Code, and Acquired Fund and Acquiring Fund each will be a "party to the
reorganization" within the meaning of Section 368(b) of the Code.
2. No gain or loss will be recognized by Acquired Fund upon the
transfer of substantially all of its assets to Acquiring Fund in exchange solely
for Acquiring Fund Shares pursuant to Section 361(a) and Section 357(a) of the
Code.
3. No gain or loss will be recognized by Acquiring Fund upon the
receipt by it of substantially all of the assets of Acquired Fund in exchange
solely for Acquiring Fund Shares pursuant to Section 1032(a) of the Code.
4. No gain or loss will be recognized by Acquired Fund upon the
distribution of Acquiring Fund Shares to its shareholders in complete
liquidation of Acquired Fund (in pursuance of the Plan) pursuant to Section
361(c)(1) of the Code.
Board of Trustees, Delaware Group Income Funds
Board of Directors, Lincoln National Income Fund, Inc.
_____________, 2006
Page 3
5. The basis of the assets of Acquired Fund received by Acquiring Fund
will be the same as the basis of these assets to Acquired Fund immediately prior
to the exchange pursuant to Section 362(b) of the Code.
6. The holding period of the assets of Acquired Fund received by
Acquiring Fund will include the period during which such assets were held by
Acquired Fund pursuant to Section 1223(2) of the Code.
7. No gain or loss will be recognized by the shareholders of Acquired
Fund upon the exchange of their Acquired Fund Shares for Acquiring Fund Shares
(including fractional shares to which they may be entitled), pursuant to Section
354(a) of the Code.
8. The basis of Acquiring Fund Shares received by the shareholders of
Acquired Fund (including fractional shares to which they may be entitled) will
be the same as the basis of Acquired Fund Shares exchanged therefor pursuant to
Section 358(a)(1) of the Code.
9. The holding period of Acquiring Fund Shares received by the
shareholders of Acquired Fund (including fractional shares to which they may be
entitled) will include the holding period of Acquired Fund Shares surrendered in
exchange therefor, provided that Acquired Fund Shares were held as a capital
asset on the Closing of the Reorganization pursuant to Section 1223(1) of the
Code.
10. Acquiring Fund will succeed to and take into account, as of the
date of the transfer as defined in Section 1.381(b)-1(b) of the income tax
regulations issued by the United States Department of the Treasury (the
"Treasury Regulations"), the items of Acquired Fund described in Section 381(c)
of the Code, subject to the conditions and limitations specified in Sections
381, 382, 383 and 384 of the Code and the Treasury Regulations.
Our opinion is based upon the Code, the applicable Treasury
Regulations, the present positions of the Internal Revenue Service (the
"Service") as are set forth in published revenue rulings and revenue procedures,
present administrative positions of the Service, and existing judicial
decisions, all of which are subject to change either prospectively or
retroactively. We do not undertake to make any continuing analysis of the facts
or relevant law following the Closing of the Reorganization.
Our opinion is conditioned upon the performance by Acquired Fund and
Acquiring Trust, on behalf of Acquiring Fund, of their undertakings in the Plan
and the Representation Letter. Our opinion is limited to the transactions
incident to the Reorganization described herein, and no opinion is rendered with
respect to (i) any other transaction or (ii) the effect, if any, of the
Reorganization (and/or the transactions incident thereto) on any other
transaction and/or the effect, if any, of any such other transaction on the
Reorganization.
This opinion is being rendered to Acquired Fund and Acquiring Trust,
on behalf of Acquiring Fund, and may be relied upon only by such funds and the
shareholders of each. We hereby consent to the use of this opinion as an exhibit
to the Registration Statement of Acquiring Fund on Form N-14, and any amendments
thereto, covering the registration of the shares of
Board of Trustees, Delaware Group Income Funds
Board of Directors, Lincoln National Income Fund, Inc.
_____________, 2006
Page 4
Acquiring Fund under the Securities Act of 1933, as amended, to be issued in the
Reorganization.
Very truly yours,
XXXXXXXX, XXXXX, XXXXXXX & XXXXX, LLP
By:______________________________
________________, a partner
