[XXXXX, XXXXX, XXXX & MAW LLP LETTERHEAD]
July 2, 2003
To the Parties Listed on Schedule I Attached Hereto
Re: Agreement and Plan of Reorganization for the Exchange of Stock of the
Small Company Growth Portfolio for Substantially All of the Assets of
the Small Cap Growth Portfolio
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Dear Ladies and Gentlemen:
We have acted as counsel to the Small Cap Growth Portfolio (the "TARGET
FUND") and the Small Company Growth Portfolio (the "ACQUIRING FUND") in
connection with the proposed transfer of substantially all of the assets of the
Target Fund to the Acquiring Fund and certain other transactions related thereto
pursuant to and in accordance with the terms of the Agreement and Plan of
Reorganization, dated as of June 5, 2003, by and between Xxxxxx Xxxxxxx
Institutional Fund, Inc., on behalf of the Acquiring Fund, and Xxxxxx Xxxxxxx
Institutional Fund Trust, on behalf of the Target Fund (the "REORGANIZATION
AGREEMENT" and such transactions, the "Reorganization"). You have requested that
we provide an opinion regarding the treatment of the Reorganization under the
Internal Revenue Code of 1986, as amended (the "CODE"), and the accuracy of the
tax disclosures in the proxy statement and prospectus (the "PROXY STATEMENT AND
PROSPECTUS") on Exhibit 12 to the Form N-14 Registration Statement.
In connection with rendering these opinions, we have examined originals
or copies, certified or otherwise identified to our satisfaction, of (i) the
Reorganization Agreement, (ii) the Registration Statement on Form N-14 for the
Reorganization, and the Proxy Statement and Prospectus and other documents,
exhibits, attachments and schedules contained therein, (iii) written
representations of Xxxxxx Xxxxxxx Investment Management Inc. and Xxxxxx Xxxxxxx
Investments LP (collectively, the "ADVISORS") concerning certain facts
underlying and relating to the Reorganization set forth in letters dated July 2,
2003, and (iv) such other documents and materials as we have deemed necessary or
appropriate for purposes of the opinions set forth below. In our examination, we
have assumed the genuineness of all signatures, the legal capacity of all
natural persons, the authenticity of all documents submitted to us as originals,
the conformity to original documents of all documents submitted to us as
certified or photostatic copies, and the authenticity of the originals of such
copies. We have not made an independent investigation of the facts set forth in
the Registration Statement, the Reorganization Agreement or such other documents
that we have examined. We have consequently assumed in rendering these opinions
that the information presented in such documents or otherwise furnished to us
July 2, 2003
Page 2
accurately and completely describes in all material respects all facts relevant
to the Reorganization.
We have also assumed for purposes of rendering our opinions (i) the
accuracy of, and material compliance with, the representations of the Advisors
set forth in the letters referred to above, (ii) the accuracy of, and material
compliance with, the representations, warranties, covenants and agreements of
the Target Fund and the Acquiring Fund made in the Reorganization Agreement, and
(iii) that there are no agreements or understandings other than those of which
we have been informed that would affect our conclusions set forth below.
The opinions set forth below are based on the Code, the legislative
history with respect thereto, rules and regulations promulgated thereunder, and
published rulings, court decisions and administrative authorities issued with
respect to all of the foregoing, all as in effect and existing on the date
hereof, and all of which are subject to change at any time, possibly on a
retroactive basis. In addition, there can be no assurance that positions
contrary to those stated in our opinions may not be asserted by the Internal
Revenue Service.
Any change occurring after the date hereof in, or a variation from, any
of the foregoing factual or legal bases for our opinions could affect the
conclusions set forth below.
In addition, the opinions expressed herein are given as of the date
hereof and we express no obligation to advise you of any changes in the law or
events that may hereafter come to our attention that could affect our opinions
set forth below.
Based on the foregoing, we are of the opinion that, for U.S. Federal
income tax purposes:
1. The summaries of U.S. Federal income tax consequences set forth in
the Proxy Statement and Prospectus under the headings "Synopsis - Tax
Consequences of the Reorganization," "The Reorganization - The Board's
Consideration" and "The Reorganization - Tax Aspects of the Reorganization" are
accurate in all material respects as to matters of law and legal conclusions.
2. The transfer of the Target Fund's assets in exchange for Acquiring
Fund shares and the assumption by the Acquiring Fund of certain stated
liabilities of the Target Fund followed by the distribution by the Target Fund
of the Acquiring Fund shares to the Target Fund shareholders in exchange for
their Target Fund shares pursuant to and in accordance with the terms of the
Reorganization Agreement will constitute a "reorganization" within the meaning
of section 368(a)(1)(C) of the Code, and the Target Fund and the Acquiring Fund
will each be a "party to a reorganization" within the meaning of section 368(b)
of the Code.
3. No gain or loss will be recognized by the Acquiring Fund upon the
receipt of the assets of the Target Fund solely in exchange for the Acquiring
Fund shares and the assumption by the Acquiring Fund of the stated liabilities
of the Target Fund.
July 2, 2003
Page 3
4. No gain or loss will be recognized by the Target Fund upon the
transfer of the assets of the Target Fund to the Acquiring Fund in exchange for
the Acquiring Fund shares and the assumption by the Acquiring Fund of the stated
liabilities of the Target Fund or upon the distribution of the Acquiring Fund
shares to the Target Fund shareholders in exchange for their Target Fund shares.
5. No gain or loss will be recognized by the Target Fund shareholders
upon the exchange of the Target Fund shares for the Acquiring Fund shares.
6. The aggregate tax basis for the Acquiring Fund shares received by
each Target Fund shareholder pursuant to the Reorganization will be the same as
the aggregate tax basis of the Target Fund shares held by each such Target Fund
shareholder immediately prior to the Reorganization.
7. The holding period of the Acquiring Fund shares to be received by
each Target Fund shareholder will include the period during which the Target
Fund shares surrendered in exchange therefor were held (provided such Target
Fund shares are held as capital assets on the date of the Reorganization).
8. The tax basis of the assets of the Target Fund acquired by the
Acquiring Fund will be the same as the tax basis of such assets to the Target
Fund immediately prior to the Reorganization.
9. The holding period of the assets of the Target Fund in the hands of
the Acquiring Fund will include the period during which those assets were held
by the Target Fund.
These opinions are being provided to you solely in connection with the
filing of the Registration Statement for the Reorganization. This opinion may
not be relied upon by you for any other purposes or relied upon by, or furnished
to, any other person without our prior written consent.
We hereby consent to the filing of this opinion as an exhibit to the
Proxy Statement and Prospectus and to all references to this firm under the
headings "Synopsis - Tax Consequences of the Reorganization, "The Reorganization
- The Board's Consideration" and "The Reorganization - Tax Aspects of the
Reorganization" in the Proxy Statement and Prospectus.
Sincerely,
XXXXX, XXXXX, XXXX & MAW LLP
JRB/KRA
