DRAFT OF JULY 8, 2005, SUBJECT TO CHANGE
__________, 2005
Pioneer Variable Contracts Trust
00 Xxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Variable Insurance Funds
0000 Xxxxxxx Xxxx
Xxxxxxxx, Xxxx 00000
Ladies and Gentlemen:
This opinion is being delivered to you in connection with the Agreement and Plan
of Reorganization (the "Agreement") made as of ______, 2005 by and between
Pioneer Variable Contracts Trust, a Delaware statutory trust, on behalf of its
series, [Pioneer Portfolio] ("Acquiring Portfolio"), and Variable Insurance
Funds, a Massachusetts business trust, on behalf of its series, [AmSouth Fund]
("Acquired Portfolio"). Pursuant to the Agreement, Acquiring Portfolio will
acquire all of the assets of Acquired Portfolio in exchange solely for (i) the
assumption by Acquiring Portfolio of all of the Assumed Liabilities of Acquired
Portfolio, as defined in the Agreement (the "Acquired Portfolio Liabilities"),
and (ii) the issuance of Class II shares of beneficial interest of Acquiring
Portfolio (the "Acquiring Portfolio Shares") to Acquired Portfolio, followed by
the distribution by Acquired Portfolio, in liquidation of Acquired Portfolio, of
the Acquiring Portfolio Shares to the shareholders of Acquired Portfolio and the
termination of Acquired Portfolio (the foregoing together constituting the
"Transaction"). All section references, unless otherwise indicated, are to the
United States Internal Revenue Code of 1986, as amended (the "Code").
In rendering this opinion, we have examined and relied upon (i) the prospectus
for Acquiring Portfolio dated ___________; (ii) the statement of additional
information for Acquiring Portfolio dated _____________; (iii) the prospectus
for Acquired Portfolio dated __________; (iv) the statement of additional
information for Acquired Portfolio dated ___________; (v) the Notice of Special
Meeting of Shareholders Scheduled for __________ and the accompanying proxy
statement and prospectus on Form N-14; (vi) the Agreement; (vii) the tax
representation certificates delivered pursuant to the Agreement and relevant to
this opinion (the "Representation Certificates"); and (viii) such other
documents as we deemed necessary or relevant to our analysis.
In our examination of documents, we have assumed, with your permission, the
authenticity of original documents, the accuracy of copies, the genuineness of
signatures, the legal capacity of signatories, and the proper execution of
documents. We have further assumed, with your permission, that (i) all parties
to the Agreement and to any other documents examined by us have
Pioneer Variable Contracts Trust
Variable Insurance Funds
__________, 2005
Page 2
acted, and will act, in accordance with the terms of such Agreement and
documents and that the Transaction will be consummated pursuant to the terms and
conditions set forth in the Agreement without the waiver or modification of any
such terms and conditions; (ii) all representations contained in the Agreement,
as well as those representations contained in the Representation Certificates
are, on the date hereof, and will be, at the consummation of the Transaction and
thereafter as relevant, true and complete; (iii) any representation made in any
of the documents referred to herein "to the knowledge and belief" (or similar
qualification) of any person or party is, and at the consummation of the
Transaction will be, correct without such qualification; and (iv) as to all
matters for which a person or entity has represented that such person is not a
party to, does not have, or is not aware of any plan, intention, understanding,
or agreement, there is no such plan, intention, understanding, or agreement. We
have not attempted to verify independently any of the above assumptions or
representations, but in the course of our representation, nothing has come to
our attention that would cause us to question the accuracy thereof.
The conclusions expressed herein represent our judgment as to the proper
treatment of the Transaction for United States federal income tax purposes based
upon the relevant provisions of the Code, the Treasury Regulations promulgated
thereunder, and interpretations of the foregoing as expressed in court decisions
and administrative determinations, all as in effect on the date of this opinion.
We cannot give any assurance that such laws will not be amended or otherwise
changed after the consummation of the Transaction or that any such changes will
not affect the conclusions expressed herein. We undertake no obligation to
update or supplement this opinion to reflect any changes in law that may occur.
Our opinion represents our best judgment of how a court would decide if
presented with the issues addressed herein and is not binding upon the Internal
Revenue Service (the "IRS") or any court. Thus, no assurance can be given that a
position taken in reliance on our opinion will not be challenged by the IRS or
rejected by a court.
This opinion is limited to the specific United States federal income tax
consequences of the Transaction set forth below. It does not address any other
federal, state, local, or foreign income, estate, gift, transfer, sales, use, or
other tax consequences that may result from the Transaction or any other
transaction, including any transaction undertaken in connection with the
Transaction. This opinion may not apply to certain classes of taxpayers,
including without limitation shareholders who are not citizens or residents of
the United States, insurance companies, tax-exempt organizations, financial
institutions, dealers in securities or foreign currencies, or persons who hold
their shares as part of a straddle or conversion transaction.
On the basis of and subject to the foregoing and in reliance upon the
representations, facts and assumptions described above, we are of the opinion
that the acquisition by Acquiring Portfolio of the assets of Acquired Portfolio
solely in exchange for the issuance of Acquiring Portfolio Shares to Acquired
Portfolio and the assumption of the Acquired Portfolio Liabilities by Acquiring
Portfolio, followed by the distribution by Acquired Portfolio, in liquidation of
Acquired Portfolio, of Acquiring Portfolio Shares to Acquired Portfolio
shareholders in exchange for their
Pioneer Variable Contracts Trust
Variable Insurance Funds
__________, 2005
Page 3
Acquired Portfolio Shares and the termination of Acquired Portfolio, will
constitute a "reorganization" within the meaning of Section 368(a) of the Code.
As indicated above, our opinion is based solely on the documents that we have
examined, including without limitation the Representation Certificates and the
assumptions described herein. If any of the facts or representations contained
in such documents is, or later becomes, inaccurate in any material respect, or
if any of the assumptions we have made is, or later becomes, unfounded in any
material respect, our opinion may be adversely affected and may not be relied
upon.
This opinion is being delivered to you solely in connection with the closing
condition set forth in Section 8.5 of the Agreement. This opinion is intended
solely for the benefit of you and the shareholders of the Acquired Portfolio and
it may not be relied upon for any other purpose or by any other person or
entity, and may not be made available to any other person or entity, without our
prior written consent.
Very truly yours,
XXXXXX XXXXXX XXXXXXXXX
XXXX AND XXXX LLP
By: __________________
