Exhibit 12
__________, 2002
Board of Trustees
RREEF Securities Trust
000 Xxxxx Xxxxxxxx Xxxxxx
00xx Xxxxx
Xxxxxxx Xxxxxxxx 00000
Board of Directors
Real Estate Securities Fund, Inc.
Xxx Xxxxx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000
Re: Agreement and Plan of Reorganization, dated as of the ___th
day of ________, 2002 (the "Agreement"), by and between RREEF
Securities Trust, a Delaware business trust (the "Trust"), on
behalf of its RREEF Real Estate Securities Fund (the
"Acquiring Fund") and Real Estate Securities Fund, Inc., a
Maryland corporation (the "Selling Fund")
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Ladies and Gentlemen:
You have requested our opinion as to certain federal income
tax consequences of the reorganization of the Selling Fund which will consist of
(i) the transfer of all or substantially all of the assets of the Selling Fund
to the Acquiring Fund, in exchange solely for shares of beneficial interest of
the Acquiring Fund as set forth in Appendix A (the "Acquiring Fund Shares");
(ii) the assumption by the Acquiring Fund of the liabilities of the Selling
Fund; and (iii) the distribution of the Acquiring Fund Shares to the
shareholders of the Selling Fund in complete liquidation of the Selling Fund as
provided herein, all upon the terms and conditions hereinafter set forth in the
Agreement.
In rendering our opinion, we have reviewed and relied
upon (a) the Agreement, (b) the proxy materials provided to shareholders of the
Selling Fund in connection with the Special Meeting of Shareholders of the
Selling Fund held on ______, _________, 2002, (c) certain representations
concerning the Reorganization made to us by the Acquiring Fund and the Selling
Fund in a letter dated __________ (collectively, the "Representation Letter"),
(d) all other documents, financial and other reports and corporate minutes which
we deemed relevant or appropriate, and (e) such statutes, regulations, rulings
and decisions as we deemed material to the rendition of this opinion. All terms
used herein, unless otherwise defined, are used as defined in the Agreement.
Board of Trustees RREEF Securities Trust
Board of Directors Real Estate Securities Fund, Inc.
__________, 2002
Page 2
For purposes of this opinion, we have assumed that the Selling
Fund and the Acquiring Fund on the Closing Date of the Reorganization each
satisfy, and following the Reorganization, the 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
("RIC").
Under regulations to be prescribed by the Secretary of
Treasury under Section 1276(d) of the Code, certain transfers of market discount
bonds will be excepted from the requirement that accrued market discount be
recognized on disposition of a market discount bond under Section 1276(a) of the
Code. Such regulations are to provide, in part, that accrued market discount
will not be included in income if no gain is recognized under Section 361(a) of
the Code where a bond is transferred in an exchange qualifying as a tax-free
reorganization. As of the date hereof, the Secretary has not issued any
regulations under Section 1276 of the Code.
Based on the foregoing and provided the Reorganization is
carried out in accordance with the laws of the States of Delaware and Maryland,
the Agreement and the Representation Letter, it is our opinion that:
1. The Reorganization will constitute a tax-free
reorganization within the meaning of Section 368(a)(1)(C) of the Code, and the
Selling Fund and the Acquiring Fund will each 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 the Acquiring Fund
upon the receipt of the assets of the Selling Fund solely in exchange for the
Acquiring Fund Shares and the assumption by the Acquiring Fund of the
liabilities of the Selling Fund pursuant to Section 1032(a) of the Code.
3. No gain or loss will be recognized by the Selling Fund upon
the transfer of all of its assets to the Acquiring Fund solely in exchange for
Acquiring Fund Shares and the assumption by the Acquiring Fund of the
liabilities of the Selling Fund or upon the distribution of the Acquiring Fund
Shares to the shareholders of the Selling Fund in exchange for such
shareholders' shares of the Selling Fund pursuant to Sections 361(a) and (c) and
357(a) of the Code. We express no opinion as to whether any accrued market
discount will be required to be recognized as ordinary income pursuant to
Section 1276 of the Code.
4. No gain or loss will be recognized by the shareholders of
the Selling Fund upon the exchange of their shares of the Selling Fund for the
Acquiring Fund Shares (including fractional shares to which they may be
entitled), pursuant to Section 354(a) of the Code.
5. The aggregate tax basis of the Acquiring Fund Shares
received by each shareholder of the Selling Fund (including fractional shares to
which they may be entitled) will be the same as the aggregate tax basis of the
Selling Fund shares exchanged therefor pursuant to Section 358(a)(1) of the
Code.
6. The holding period of the Acquiring Fund Shares received by
the shareholders of Selling Fund (including fractional shares to which they may
be entitled) will include the holding period of the Selling Fund Shares
surrendered in exchange therefor, provided that the Selling Fund Shares were
held as a capital asset on the Closing Date of the Reorganization, pursuant to
Section 1223(1) of the Code.
Board of Trustees RREEF Securities Trust
Board of Directors Real Estate Securities Fund, Inc.
__________, 2002
Page 3
7. The tax basis of the assets of the Selling Fund received by
the Acquiring Fund will be the same as the tax basis of such assets to the
Selling Fund immediately prior to the exchange pursuant to Section 362(b) of the
Code.
8. The holding period of the assets of the Selling Fund
received by the Acquiring Fund will include the period during which such assets
were held by the Selling Fund pursuant to Section 1223(2) of the Code.
9. 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) the items of the Selling Fund described in Section 381(c) of the
Code, subject to the conditions and limitations specified in Sections 381(b) and
(c), 382, 383 and 384 of the Code.
This opinion letter expresses our views only as to U.S.
federal income tax laws in effect as of the date hereof. It represents our best
legal judgment as to the matters addressed herein, but is not binding on the
Internal Revenue Service or the courts. Accordingly, no assurance can be given
that the opinions and analysis expressed herein, if contested, would be
sustained by a court. Our opinion is based upon the Code, the applicable
Treasury Regulations promulgated thereunder, the present position of the
Internal Revenue Service as set forth in published revenue rulings and revenue
procedures, present administrative positions of the Internal Revenue 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 date of this letter.
Our opinion is conditioned upon the performance by the Trust,
on behalf of the Acquiring Fund, and the Selling Fund of their undertakings in
the Agreement and the Representation Letter.
This opinion is being rendered to the Trust on behalf of the
Acquiring Fund, the Selling Fund and the shareholders of such funds.
We hereby consent to the filing of this opinion as an exhibit
to the Trust's Registration Statement filed on Form N-14 (the "Registration
Statement"). In giving this consent, we do not concede that we are in the
category of persons whose consent is required under Section 7 of the 1933 Act.
Very truly yours,
Board of Trustees RREEF Securities Trust
Board of Directors Real Estate Securities Fund, Inc.
__________, 2002
Page 4
APPENDIX A
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Class of Selling Fund Class of Acquiring Fund
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Class A Class A
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Class B Class B
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Class C Class C
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Institutional Class Institutional Class
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