Exhibit 12
Ex-99.12
Xxxxxxxx & Worcester
A Registered Limited Liability Partnership
XXX XXXX XXXXXX XXXXXX
Xxxxxx, Xxxxxxxxxxxxxx 00000
(000) 000-0000
FAX NO. 000-000-0000
In Washington, D.C. In New York City
0000 Xxxxxxxxxxx Xxxxxx, X.X. 000 Xxxxx Xxxxxx
Xxxxxxxxxx, X.X. 00000 Xxx Xxxx, X.X. 00000
(000) 000-0000 (000) 000-0000
FAX NO.000-000-0000 FAX NO. 000-000-0000
October 16, 1995
Xxxxxxx Responsibly Invested Equity Portfolio
Xxxxxxx Responsibly Invested Capital
Accumulation Portfolio
0000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, Xx. 00000
Re: Acquisition of Assets of Xxxxxxx
Responsibly Invested Equity Portfolio
Ladies and Gentlemen:
You have asked for our opinion as to certain tax consequences
of the proposed acquisition of assets of Xxxxxxx Responsibly Invested
Equity Portfolio ("Selling Fund"), a series of Acacia Capital
Corporation, a Maryland corporation (the "Company"), by Xxxxxxx
Responsibly Invested Capital Accumulation Portfolio ("Acquiring Fund"),
also a series of the Company, in exchange for voting shares of Acquiring
Fund (the "Reclassification").
In rendering our opinion, we have reviewed and relied upon the
draft Prospectus/Proxy Statement dated October 2, 1995 and the Agreement
and Plan of Reclassification (the "Agreement") dated as of October 11,
1995. We have relied, without independent verification, upon the
factual statements made therein, and assume that there will be no change
in material facts disclosed therein between the date of this letter and
the date of closing of the Reclassification. We further assume that the
Reclassification will be carried out in accordance with the Agreement.
We have also relied upon the following representations, each of which
has been made to us by officers of the Company on behalf of Acquiring
Fund or of Selling Fund:
A. The Reclassification will be consummated substantially as
described in the Agreement.
B. Acquiring Fund will acquire from Selling Fund at least
90% of the Fair market value of the net assets and at least 70% of the
fair market value of the gross assets held by Selling Fund immediately
prior to the Reclassification. For purposes of this representation,
assets of Selling Fund used to pay reorganization expenses, cash
retained to pay liabilities, and redemptions and distributions (except
for regular and normal distributions) made by selling Fund immediately
preceding the transfer which are part of the plan of reorganization,
will be considered as assets held by Selling Fund immediately prior to
the transfer.
C. To the best of the knowledge of management of Selling
Fund, there is no plan or intention on the part of the shareholders of
Selling Fund to sell, exchange, or otherwise dispose of a number of
Acquiring Fund shares received in the Reclassification that would reduce
the former Selling Fund shareholders' ownership of Acquiring Fund shares
to a number of shares having a value, as of the date of the
Reclassification (the "Closing Date"), of less than 50 percent of the
value of all of the formerly outstanding shares of Selling Fund as of
the same date. For purposes of this representation, Selling Fund shares
exchanged for cash or other property will be treated as outstanding
Selling Fund shares on the Closing Date. There were no dissenters'
rights in the Reclassification, and no cash will be exchanged for
Selling Fund shares in lieu of fractional shares of Acquiring Fund.
Moreover, shares of Selling Fund and shares of Acquiring Fund held by
Selling Fund shareholders and otherwise sold, redeemed, or disposed of
prior or subsequent to the Reclassification will be considered in making
this representation, except for shares of Selling Fund or Acquiring Fund
redeemed in the ordinary course of business of Selling Fund or Acquiring
Fund in accordance with the requirements of section 22 (e) of the
Investment Company Act of 1940.
D. Selling Fund has not redeemed and will not redeem the
shares of any of its shareholders in connection with the
Reclassification except to the extent necessary to comply with its legal
obligation to redeem its shares.
E. The management of Acquiring Fund has no plan or
intention to redeem or reacquire any of the Acquiring Fund shares to be
received by Selling Fund shareholders in connection with the
Reclassification, except to the extent necessary to comply with its
legal obligation to redeem its shares.
F. The management of Acquiring Fund has no plan or
intention to sell or dispose of any of the assets of Selling Fund which
will be acquired by Acquiring Fund in the Reclassification, except for
dispositions made in the ordinary course of business, and to the extent
necessary to enable Acquiring Fund to comply with its legal obligation
to redeem its shares.
G. Following the Reclassification, Acquiring Fund will
continue the historic business of Selling Fund in a substantially
unchanged manner as part of the regulated investment company business of
Acquiring Fund, or will use a significant portion of Selling Fund's
historic business assets in a business.
H. There is no intercorporate indebtedness between
Acquiring Fund and Selling Fund.
I. Acquiring Fund does not own, directly or indirectly,
and has not owned in the last five years, directly or indirectly, any
shares of Selling Fund. Acquiring Fund will not acquire any shares of
Selling Fund prior to the Closing Date.
J. Acquiring Fund will not make any payment of cash or of
property other than shares to Selling Fund or to any shareholder of
Selling Fund in connection with the Reclassification.
K. Pursuant to the Agreement, the shareholders of Selling
Fund will receive solely Acquiring Fund voting shares in exchange for
their voting shares of Selling Fund.
L. The fair market value of the Acquiring Fund shares to
be received by the Selling Fund shareholders will be approximately equal
to the fair market value of the Selling Fund shares surrendered in
exchange therefor.
M. Subsequent to the transfer of Selling Fund's assets to
Acquiring Fund pursuant to the Agreement, Selling Fund will distribute
the shares of Acquiring Fund, together with other assets it may have, in
final liquidation as expeditiously as possible.
N. Selling Fund is not under the jurisdiction of a court
in a Title 11 or similar case within the meaning of Section 368 (a) (3)
(A) of the Internal Revenue Code of 1986, as amended (the "Code").
O. Selling Fund is treated as a corporation for federal
income tax purposes and at all times in its existence has qualified as a
regulated investment company, as defined in Section 851 of the Code.
P. Acquiring Fund is treated as a corporation for federal
income tax purposes and at all times in its existence has qualified as a
regulated investment company, as defined in Section 851 of the Code.
Q. The sum of the liabilities of Selling Fund to be
assumed by Acquiring Fund and the expenses of the Reclassification does
not exceed twenty percent of the fair market value of the assets of
Selling Fund.
R. The foregoing representations are true on the date of
this letter and will be true on the date of closing of the
Reclassification.
Based on and subject to the foregoing, and our examination of
the legal authority we have deemed to be relevant, it is our opinion
that for federal income tax purposes:
1. The acquisition by Acquiring Fund of substantially all
of the assets of Selling Fund solely in exchange for voting shares of
Acquiring Fund followed by the distribution by Selling Fund of said
Acquiring Fund shares to the shareholders of Selling Fund in exchange
for their Selling Fund shares will constitute a reorganization within
the meaning of Section 368 (a) (1) (C) of the Code, and Acquiring Fund
and Selling Fund will each be "a party to a reorganization" within the
meaning of Section 368 (b) of the Code.
2. No gain or loss will be recognized to Selling Fund upon
the transfer of substantially all of its assets to Acquiring Fund solely
in exchange for Acquiring Fund voting shares and assumption by Acquiring
Fund of certain identified liabilities of Selling Fund, or upon the
distribution of such Acquiring Fund voting shares to the shareholders of
Selling Fund in exchange for all of their Selling Fund shares.
3. No gain or loss will be reorganized by Acquiring Fund upon the
receipt of the assets of Selling Fund (including any cash retained
initially by Selling Fund to pay liabilities but later transferred)
solely in exchange for Acquiring Fund voting shares and assumption by
Acquiring Fund of certain identified liabilities of Selling Fund.
4. The basis of the assets of Selling Fund acquired by Acquiring
Fund will be the same as the basis of those assets in the hands of
Selling Fund immediately prior to the transfer, and the holding period
of the assets of Selling Fund in the hands of Acquiring Fund will
include the period during which those assets were held by Selling Fund.
5. The shareholders of Selling Fund will recognize no gain
or loss upon the exchange of all of their Selling Fund shares solely for
Acquiring Fund voting shares. Gain, if any, will be realized by Selling
Fund shareholders who in exchange for their Selling Fund shares receive
other property or money in addition to Acquiring Fund shares, and will
be recognized, but not in excess of the amount of cash and the value of
such other property received. If the exchange has the effect of
the distribution of a dividend, then the amount of gain recognized that
is not in excess of the ratable share of undistributed earnings and
profits of Selling Fund will be treated as a dividend.
6. The basis of the Acquiring Fund voting shares to be
received by the Selling Fund shareholders will be the same as the basis
of the Selling Fund shares surrendered in exchange therefor.
7. The holding period of the Acquiring Fund voting shares
to be received by the Selling Fund shareholders will include the period
during which the Selling Fund shares surrendered in exchange therefor
were held, provided the Selling Fund shares were held as a capital asset
on the date of the exchange.
This opinion letter is delivered to you in satisfaction of the
requirements of Paragraph III.D. of the Agreement. We hereby consent to
the filing of this opinion as an exhibit to the Registration Statement
on Form N-14 and to use of our name and any reference to our firm in the
Registration Statement or in the Prospectus/Proxy Statement constituting
a part thereof. In giving such consent, we do not thereby admit that we
come within the category of persons whose consent is required under
Section 7 of the Securities Act of 1933, as amended, or the rules and
regulations of the Securities and Exchange Commission thereunder.
Very truly yours,
XXXXXXXX & WORCESTER
A Registered Limited
Liability Partnership
XXXXXXX.OPN
