Exhibit 8.2
[Date]
Harbor Federal Bancorp, Inc.
000 Xxxx Xxxx
Xxxxxxxxx, Xxxxxxxx 00000
Attention: Xxxxxx X. Xxxxxxxx, President
Re: Agreement and Plan of Merger dated as of May 3, 2000 by and
between Provident Bankshares Corporation and Harbor Federal
Bancorp, Inc.
Ladies and Gentlemen:
You have requested our opinion with regard to certain federal income
tax consequences of the proposed merger (Merger) of Harbor Federal Bancorp, Inc.
(Harbor) with and into Provident Bankshares Corporation (Provident).
In connection with the preparation of our opinion, we have examined
and have relied upon the following:
(i) The Agreement and Plan of Merger dated May 3, 2000 by and
between Provident and Harbor, including the exhibits thereto
(Agreement), the Resolution of Harbor's Board of Directors to
undertake the Merger and the Resolution of Harbor's shareholders
approving the Merger;
(ii) Provident's Registration Statement on form S-4, including the
Proxy Statement/Prospectus contained therein, filed with the
Securities and Exchange Commission on June 21, 2000, as supplemented
and amended to the date hereof (the "Registration Statement");
(iii) The representations and undertaking of Harbor substantially in
the form of Exhibits [ ]; and
(iv) The representations and undertakings of Provident
substantially in the form of Exhibit [ ] hereto.
Our opinion is based solely upon applicable law and the factual
information and undertakings contained in the above-mention documents. In
rendering our opinion, we have
Board of Directors
____________, 2000
Page 2
assumed the accuracy of all information and the performance of all undertakings
contained in each of such documents, and we have assumed that all
representations made to the knowledge of any person or entity or with similar
qualification will be true and correct as if made without such qualification. We
also have assumed the authenticity of all original documents, the conformity of
all copies to the original documents, and the genuineness of all signatures. We
have not attempted to verify independently the accuracy of any information in
any such document, and we have assumed that such documents accurately and
completely set forth all material facts relevant to this opinion. All of our
assumptions are made with your consent. If any fact or assumption described
herein or below is incorrect, any or all of the federal income tax consequences
described herein may be inapplicable. References herein to the "Code" shall be
to the Internal Revenue Code of 1986, as amended to the date hereof.
OPINION
Subject to the foregoing, to the conditions and limitations expressed
elsewhere herein, and assuming that the Merger is consummated in accordance with
the Agreement, we are of the opinion that for federal income tax purposes:
1. The merger of Harbor into Provident will constitute and qualify
as a reorganization under section 368(a)(1)(A) of the Code.
2. Harbor will not recognize gain or loss on the Merger under
section 354(a)(1) of the Code;
3. Each shareholder of Harbor who exchanges in the Merger, shares of
Harbor common stock solely for shares of Provident common stock:
(a) will recognize no gain or loss as a result of the exchange,
under section 354(a)(1) of the Code, except with regard to cash
received in lieu of a fractional share, as discussed below;
(b) will have, under section 358(a)(1) of the Code, an aggregate
basis for the shares of Provident common stock received
(including any fractional share of Provident common stock deemed
to be received, as described in paragraph 2, below) equal to the
aggregate adjusted tax basis of the shares of Harbor common
stock surrendered;
(c) will have, under section 1223(1) of the Code, a holding
period for the shares of Provident common stock received
(including any fractional share of Provident common stock deemed
to be received, as described in paragraph 2, below) which
includes the holding period of the shares of Harbor common stock
surrendered, provided that the shares of Harbor
Board of Directors
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common stock surrendered are held as capital assets at the time
of the Merger.
4. Each shareholder of Harbor who receives, in the Merger, cash in
lieu of a fractional share of Provident common stock will be treated as if the
fractional share had been received in the Merger and then redeemed by Provident.
Provided that the shares of Harbor common stock surrendered are held as capital
assets at the time of the Merger, the receipt of such cash will cause the
recipient to recognize capital gain or loss, equal to the difference between the
amount of cash received and the portion of such holder's basis in the shares of
Harbor common stock allocable to the fractional share. See sections 1001 and
1222 of the Code; Rev. Rul 66-365, 1966-2 C.B. 116; Rev. Proc. 77-41, 1977-2
C.B. 574)
We express no opinion with regard to: (1) the federal income tax
consequences of the Merger not addressed expressly by this opinion, including
without limitation, (i) the tax consequences, if any, to those shareholders of
Harbor who acquired shares of Harbor common stock pursuant to the exercise of
employee stock options or otherwise as compensation and, (ii) the tax
consequences to special classes of shareholders, if any, including without
limitation, foreign persons, insurance companies, tax-exempt entities,
retirement plans, dealers in securities, and persons who hold their Harbor
common stock as part of a "straddle," "hedge" or "conversion transaction," and
(2) federal, state, local and foreign taxes (or any other federal, state, local,
or foreign laws) not specifically referred to and discussed herein. Further,
our opinion is based upon the Code, Treasury Regulations proposed or promulgated
thereunder, and administrative interpretations and judicial precedents relating
thereto, all of which are subject to change at any time, possibly with
retroactive effect, and we assume no obligation to advise you of any subsequent
change thereto. If there is any change in the applicable law or regulations, or
if there is any new administrative or judicial interpretation of the applicable
law or regulations, any or all of the federal income tax consequences described
herein may become inapplicable.
The foregoing opinion reflects our legal judgement solely on the
issues presented and discussed herein. This opinion has no official status or
binding effect of any kind. Accordingly, we cannot assure you that the Internal
Revenue Service or any court of competent jurisdiction will agree with this
opinion.
This opinion is provided for the benefit of Harbor. We hereby consent
to the filing of this letter as an exhibit to the Registration Statement and to
all references made to this letter and to this firm in the Registration
Statement.
Very truly yours,
Xxxxxxxx Ronon Xxxxxxx Xxxxxxxxx &
Xxxxxxxxx, LLP
____________________________
by: [partner]
