Exhibit 8.1
______ __, 2003
Board of Directors
Xxxxxxx Financial Corporation
Xxxxxxx Plaza
Waterbury, Connecticut 06702
Gentlemen and Ladies:
This opinion is being delivered to you in accordance with Section 7.2(g) of
the Agreement and Plan of Merger (the "Agreement") dated as of June 4, 2003, by
and among Xxxxxxx Financial Corporation ("Xxxxxxx"), a Delaware corporation,
Xxxxxxx Bank ("Xxxxxxx Bank"), a federally chartered savings bank and wholly
owned subsidiary of Xxxxxxx, and North American Bank & Trust Co. ("North
American"), a Connecticut chartered commercial bank. Pursuant to the Agreement,
North American will be merged with and into Xxxxxxx Bank (the "Merger").
In connection with the preparation of this opinion, we have examined and
with your consent relied upon the following documents (including all exhibits
and schedules thereto): (1) the Agreement; (2) the Registration Statement on
Form S-4 of Xxxxxxx (File No. __________) filed with the Securities and Exchange
Commission ("SEC") on August __, 2003, as amended by Pre-Effective Amendment No.
1 thereto filed with the SEC on _________ __, 2003, as declared effective by the
SEC on August __, 2003 (the "Registration Statement") and the Proxy
Statement/Prospectus included as a part thereof; (3) representations and
certifications made to us by Xxxxxxx and Xxxxxxx Bank; (4) representations and
certifications made to us by North American; and (5) such other instruments and
documents related to the formation, organization and operation of Webster,
Webster Bank and North American or to the consummation of the Merger and the
transactions contemplated thereby as we have deemed necessary or appropriate.
All capitalized terms used herein and not otherwise defined shall have the
same meaning as they have in the Agreement. All section references, unless
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Page 2
otherwise indicated, are to the Internal Revenue Code of 1986, as amended (the
"Code").
The Proposed Transaction
Based solely upon our review of the documents set forth above, and upon
such information as Webster, Webster Bank and North American have provided to us
and in reliance upon such documents and information, we understand that the
proposed transaction and the relevant facts with respect thereto are as follows:
Xxxxxxx is the holding company of Xxxxxxx Bank. Both Xxxxxxx and Xxxxxxx
Bank are headquartered in Waterbury, Connecticut. North American is also
headquartered in Waterbury, Connecticut.
It is proposed that pursuant to the Agreement, Federal law and regulation
applicable to savings associations and the General Statutes of Connecticut,
North American will merge with and into Xxxxxxx Bank. As a result of the Merger,
North American's corporate existence will cease and Xxxxxxx Bank will be the
Surviving Institution. As the Surviving Institution, Xxxxxxx Bank will succeed
to all of the assets and liabilities of North American.
By virtue of the Merger, each share of North American Common Stock issued
and outstanding prior to the Effective Time (other than Dissenters' Shares and
shares of North American Common Stock held directly or indirectly by North
American, Xxxxxxx or any of their subsidiaries, other than trust account shares
and shares related to a debt previously contracted) will be converted into the
right to receive a combination of the Stock Consideration and the Cash
Consideration, subject to adjustment as provided in Section 1.5 of the
Agreement. Certificates for fractions of shares of Xxxxxxx Common Stock will not
be issued. In lieu of a fraction of a share of Xxxxxxx Common Stock, each holder
of North American Common Stock otherwise entitled to a fraction of a share of
Xxxxxxx Common Stock will be entitled to receive an amount of cash equal to (i)
the fraction of a share of the Xxxxxxx Common Stock to which such holder would
otherwise be entitled, multiplied by (ii) the actual market value of the Xxxxxxx
Common Stock, which will be deemed to be the average of the daily closing prices
per share for Xxxxxxx Common Stock for the fifteen consecutive trading days on
which shares of Xxxxxxx Common Stock are actually traded (as reported on the New
York Stock Exchange) ending on the third trading day preceding the Closing Date.
Under Section 33-856 of the Connecticut Business Corporation Act, North American
shareholders are entitled to dissent and
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demand appraisal rights, which if perfected, could result in such shareholders
receiving solely cash in the Merger.
At the Effective Time, each option granted by North American to purchase
shares of North American Common Stock which is outstanding and unexercised
immediately prior thereto will be converted automatically into a right to
purchase shares of Xxxxxxx Common Stock, with adjustment in the number of shares
and exercise price to reflect the Option Exchange Ratio.
Assumptions and Representations
In connection with rendering this opinion, we have assumed or obtained
representations (and, with your consent, are relying thereon, without any
independent investigation or review thereof, although we are not aware of any
material facts or circumstances contrary to or inconsistent therewith) that:
1. All information contained in each of the documents we have examined
and relied upon in connection with the preparation of this opinion is accurate
and completely describes all material facts relevant to our opinion, all copies
are accurate and all signatures are genuine. We have also assumed that there has
been (or will be by the Effective Time of the Merger) due execution and delivery
of all documents where due execution and delivery are prerequisites to the
effectiveness thereof.
2. The Merger will be consummated in accordance with applicable state law
and will qualify as a statutory merger under applicable state law.
3. All representations made to us are true, correct, and complete, and
will remain true, correct and complete at all times up to the Effective Time.
Any representation or statement made "to the knowledge" or similarly qualified
is correct without such qualification.
4. The Merger Agreement will not be amended, waived or otherwise
modified. The Merger will be consummated in accordance with the Agreement and as
described in the Proxy Statement/Prospectus (including satisfaction of all
covenants and conditions to the obligations of the parties without amendment or
waiver thereof); Webster, Webster Bank and North American will comply with all
reporting obligations with respect to the Merger required under the Code and the
Treasury Regulations thereunder; and the Agreement and all other documents and
instruments referred to therein or in the Proxy Statement/Prospectus are valid
and binding in accordance with their terms.
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______ __, 2003
Page 4
Opinion - Federal Income Tax Consequences
Based upon and subject to the assumptions and qualifications set forth
herein, it is our opinion that for Federal income tax purposes the Merger will
qualify as a reorganization within the meaning of Section 368(a) of the Code.
In addition to the assumptions set forth above, this opinion is subject to
the exceptions, limitations and qualifications set forth below:
1. This opinion represents and is based upon our best judgment regarding
the application of relevant current provisions of the Code, U.S. Treasury
Regulations thereunder, and interpretations of the foregoing as expressed in
existing court decisions, administrative determinations (including the practices
and procedures of the Internal Revenue Service (the "IRS") in issuing private
letter rulings, which are not binding on the IRS except with respect to the
taxpayer that receives such a ruling) and published rulings and procedures all
as of the date hereof. An opinion of counsel merely represents counsel's best
judgment with respect to the probable outcome on the merits and is not binding
on the IRS or the courts. There can be no assurance that positions contrary to
our opinions will not be taken by the IRS, or that a court considering the
issues would not hold contrary to such opinions. Neither Webster, Webster Bank
nor North American has requested a ruling from the IRS (and no ruling will be
sought) as to any of the federal income tax consequences addressed in this
opinion. Furthermore, no assurance can be given that future legislative,
judicial or administrative changes, on either a prospective or retroactive
basis, would not adversely affect the accuracy of the opinion expressed herein.
Nevertheless, we undertake no responsibility to advise you of any new
developments in the law or in the application or interpretation of the federal
income tax laws.
2. This letter addresses only the specific tax opinion set forth above.
This letter does not address any other federal, state, local or foreign tax
consequences that may result from the Merger or any other transaction (including
any transaction undertaken in connection with the Merger).
3. We express no opinion regarding, among other things, the tax
consequences of the Merger (including the opinion set forth above) as applied to
North American or specific shareholders of North American, or that may be
relevant to particular classes of North American shareholders, such as
tax-exempt organizations, mutual funds, dealers in securities or foreign
currencies, banks or other financial institutions, insurance companies,
non-United States persons,
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Page 5
holders of shares acquired upon exercise of stock options or otherwise as
compensation or through a qualified retirement plan, shareholders subject to the
alternative minimum tax, shareholders who hold shares of North American common
stock as part of a straddle, hedge, constructive sale or conversion transaction,
traders in securities who elect to apply a mark-to-market method of accounting,
and holders that do not hold their North American common stock as capital
assets.. In addition, we express no opinion regarding the tax consequences to a
holder of an option to purchase shares of North American Common Stock who
receives an option to purchase shares of Xxxxxxx Common Stock in exchange
therefor pursuant to the Merger.
4. Our opinion set forth herein is based upon the description of the
contemplated transactions as set forth above in the section of this letter
captioned "The Proposed Transaction," and in the Agreement and the Proxy
Statement/Prospectus (the "Transactions"). If the actual facts relating to any
aspect of the Transactions differ from this description in any material respect,
our opinion may become inapplicable. No opinion is expressed as to any
transaction other than the Transactions or to any transaction whatsoever,
including the Merger, if the Transactions are not consummated in accordance with
the terms of the Agreement and without waiver or breach of any material
provision thereof or if all of the representations, warranties, statements and
assumptions upon which we relied are not true and accurate at all relevant
times. In the event any one of the statements, representations, warranties or
assumptions upon which we have relied to issue this opinion is incorrect, our
opinion might be adversely affected and may not be relied upon.
This opinion is provided to Xxxxxxx only, and without our prior written
consent, may not be relied upon, used, circulated, quoted or otherwise referred
to in any manner by any person, firm, governmental authority or entity
whatsoever other than reliance thereon by Xxxxxxx.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the reference to us under the heading "The Merger
- Material Federal Income Tax Consequences" in the Registration Statement. In
giving such 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 SEC promulgated thereunder.
Sincerely yours,
XXXXX & XXXXXXX L.L.P.
