EXHIBIT 8.1
[SNR Letterhead]
November 20, 1998
DST Systems, Inc.
000 Xxxx 00xx Xxxxxx
Xxxxxx Xxxx, Xxxxxxxx 00000
Re: Agreement and Plan of Merger dated September 2, 1998 between DST
Systems, Inc. ("DST"), USCS International, Inc. ("USCS") and DST
ACQUISITIONS, INC. ("ACQUISITION SUB")
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Ladies and Gentlemen:
We have acted as special counsel to DST, a Delaware corporation, in
connection with a proposed merger (the "Merger") of Acquisition Sub, a Delaware
corporation and wholly-owned subsidiary of DST, a Delaware corporation, with and
into USCS, a Delaware corporation, pursuant to an Agreement and Plan of Merger
dated September 2, 1998 (the "Merger Agreement") by and among DST, Acquisition
Sub and USCS. In the Merger, each issued and outstanding share of common stock
of USCS, par value $.01 per share, other than shares of USCS already owned by
DST, will be converted into the right to receive .62 of a share of common stock,
par value $.01 per share, of DST.
In that connection, you have requested our opinion regarding the material
federal income tax consequences of the Merger. In providing our opinion, we
have examined the Merger Agreement, the registration statement on Form S-4, as
amended to date (the "Registration Statement"), which includes the Joint Proxy
Statements/Prospectus of USCS and DST, as filed with the Securities and Exchange
Commission (the "SEC"), and such other documents and corporate records as we
have deemed necessary or appropriate for purposes of our opinion. In addition,
we have assumed that (i) the Merger will be consummated in the manner
contemplated by the Registration Statement and in accordance with the provisions
of the Merger Agreement, (ii) the statements concerning the Merger set forth in
the Merger Agreement and the Registration Statement are true, correct and
complete and will continue to be true, correct and complete at all times up to
and including the Closing Date, (iii) the representations made to us by DST and
USCS in their respective letters to us each dated the date hereof, and delivered
to us for purposes of this opinion are true, correct and complete and will
continue to be true, correct and complete at all times up to and including the
Closing Date ("Representation Letters") and (iv) any representations made in the
Representation Letters or in the Merger Agreement "to the best knowledge of", or
similarly
DST Systems, Inc.
November 20, 1998
Page 2
qualified, are correct, and will continue to be true and correct and complete at
all times up to and including the Closing Date, in each case without such
qualification. If any of the above-described assumptions are untrue for any
reason or if the Merger is consummated in a manner that is inconsistent with the
manner in which it is described in the Merger Agreement or the Registration
Statement, our opinions as expressed below may be adversely affected and may not
be relied upon.
The opinions expressed herein are based upon existing statutory, regulatory
and judicial authority, any of which may be changed at any time with retroactive
effect. Our opinions are limited to the tax matters specifically covered
hereby, and we have not been asked to address, nor have we addressed, any other
tax consequences of the Merger or any other transactions.
Based upon the foregoing, we are of the opinion that (i) the Merger will be
treated for U.S. Federal income tax purposes as a reorganization within the
meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended
("Code") and (ii) the discussion contained in the Registration Statement under
the caption "Material United States Federal Income Tax Consequences of the
Merger" represents an accurate summary of the material Federal income tax
consequences of the Merger in all material aspects.
We express no opinion on any issue relating to Federal income tax
consequences other than those described herein and under the caption "Material
United States Federal Income Tax Consequences of the Merger" in the Registration
Statement. This opinion is expressed as of the date hereof, and we disclaim any
undertaking to advise you of the subsequent changes of the matters stated,
represented or assumed herein or any subsequent changes in applicable law,
regulations or interpretations thereof.
We hereby consent to the filing of this opinion as Exhibit 8.1 to the
Registration Statement. We also consent to the references to Xxxxxxxxxxxx Xxxx &
Xxxxxxxxx under the captions "Legal Matters," "Material United States Federal
Income Tax Consequences of the Merger," "Conditions to the Merger," "Conditions;
Waivers" and "Legal Opinions," and to the inclusion of the summary of our
opinion in "Material United States Federal Income Tax Consequences of the
Merger," in the Prospectus filed as part of the Registration Statement. In
giving this consent, we do not thereby admit that we are in 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 promulgated thereunder.
Very truly yours,
/s/ Xxxxxxxxxxxx Xxxx & Xxxxxxxxx
