Xxxxx, Xxxxx & Xxxxx
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
March 1, 2000
To the Persons Listed on
Schedule I Attached hereto
Re: Agreement and Plan of Reorganization for the Exchange
of Stock of Xxxxxx Xxxxxxx Xxxx Xxxxxx Tax-Exempt
Securities Trust for Substantially All of the Assets
of Ohio Series, a portfolio of Xxxxxx Xxxxxxx Xxxx
Xxxxxx Multi-State Municipal Series Trust, dated as
of January 26, 2000 (the "Reorganization Agreement").
Ladies and Gentlemen:
We have acted as counsel to Ohio Series ("Ohio Series"), a portfolio of
Xxxxxx Xxxxxxx Xxxx Xxxxxx Multi-State Municipal Series Trust ("Multi-State"),
and Xxxxxx Xxxxxxx Xxxx Xxxxxx Tax-Exempt Securities Trust ("Tax-Exempt") in
connection with the proposed transfer of substantially all of the assets of Ohio
Series to Tax-Exempt and certain other transactions related thereto pursuant to
and in accordance with the terms of the Reorganization Agreement (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/prospectus (the "Proxy Statement/Prospectus") on Exhibit 12 to the
Form N-14 Registration Statement.
In connection with rendering this opinion, 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/Prospectus and other documents,
exhibits, attachments and schedules contained therein, (iii) written
representations of Xxxxxx Xxxxxxx Xxxx Xxxxxx Advisors Inc. (the "Advisor")
concerning certain facts underlying and relating to the Reorganization set forth
in a letter dated March 1, 2000, 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 either in the Registration Statement, the
Reorganization Agreement or such other documents that we have examined. We have
consequently assumed in rendering this opinion that the information presented in
such documents or otherwise furnished to us accurately and completely describes
in all material respects all facts relevant to the Reorganization.
We have also assumed for purposes of rendering our opinion (i) the
accuracy of, and material compliance with, the representations of the Advisor
set forth in the letter referred to above, (ii) the accuracy of, and material
compliance with, the representations, warranties,
covenants and agreements of Tax-Exempt and Multi-State, on behalf of Ohio
Series, 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 opinion set forth below is 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 opinion 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 opinion could affect the
conclusions set forth below.
In addition, the opinion expressed herein is 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 opinion
set forth below.
Based on the foregoing, we are of the opinion that, for federal income
tax purposes:
1. The summaries of United States federal income tax consequences set
forth in the Proxy Statement/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 Ohio Series' assets in exchange for Tax-Exempt
Shares(1) and the assumption by Tax-Exempt of certain stated liabilities of Ohio
Series followed by the distribution by Ohio Series of Tax-Exempt Shares to the
Ohio Series Shareholders in exchange for their Ohio Series 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
Ohio Series and Tax-Exempt 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 Tax-Exempt upon receipt of the
assets of Ohio Series solely in exchange for Tax-Exempt Shares and the
assumption by Tax-Exempt of the stated liabilities of Ohio Series.
4. No gain or loss will be recognized by Ohio Series upon the transfer
of the assets of Ohio Series to Tax-Exempt in exchange for Tax-Exempt Shares and
the assumption by Tax-Exempt of the stated liabilities or upon the distribution
of Tax-Exempt Shares to the Ohio Series Shareholders in exchange for their Ohio
Series shares.
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(1) Capitalized terms used herein without definition have the meanings
ascribed to them in the Reorganization Agreement.
5. No gain or loss will be recognized by the Ohio Series Shareholders
upon the exchange of the Ohio Series shares for Tax-Exempt Shares.
6. The aggregate tax basis for the Tax-Exempt Shares received by each
Ohio Series Shareholder pursuant to the Reorganization will be the same as the
aggregate tax basis of the Ohio Series shares held by each such Ohio Series
Shareholder immediately prior to the Reorganization.
7. The holding period of the Tax-Exempt Shares to be received by each
Ohio Series Shareholder will include the period during which the Ohio Series
shares surrendered in exchange therefor were held (provided such Ohio Series
shares are held as capital assets on the date of the Reorganization).
8. The tax basis of the assets of Ohio Series acquired by Tax-Exempt
will be the same as the tax basis of such assets to Ohio Series immediately
prior to the Reorganization.
9. The holding period of the assets of Ohio Series in the hands of
Tax-Exempt will include the period during which those assets were held by Ohio
Series.
This opinion is 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 purpose 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/Prospectus and to all references to this firm under the headings
"Synopsis -- Tax Consequences of the Reorganization" and "The Reorganization --
Tax Aspects of the Reorganization" in the Proxy Statement/Prospectus.
Very truly yours,
/s/ Xxxxx, Xxxxx & Xxxxx
XXXXX, XXXXX & XXXXX
SCHEDULE I
Xxxxxx Xxxxxxx Xxxx Xxxxxx
Multi-State Municipal Series Trust, on behalf of Ohio Series
Xxxxxx Xxxxxxx Xxxx Xxxxxx
Tax-Exempt Securities Trust
