October 26, 2020
EX-16.12.a
Xxxxxxxx Ronon Xxxxxxx & Xxxxx, LLP
Xxxxx 0000
xxx.xxxxxxxx.xxx
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October 26, 2020
Board of Trustees, Nationwide Variable Insurance Trust
One Nationwide Plaza
Mail Code 5-02-210
Xxxxxxxx, Xxxx 00000
Re: |
Agreement and Plan of Reorganization (“Plan”) made as of August 10, 2020, by Nationwide Variable Insurance Trust (the “Trust”), a statutory trust created under the
laws of the State of Delaware on behalf of four of its series, NVIT DFA Capital Appreciation Fund (the “Capital Appreciation Target Fund”) and NVIT Investor Destinations Capital Appreciation Fund (the “Capital Appreciation Acquiring Fund”),
and NVIT DFA Moderate Fund (the “Moderate Target Fund”) and NVIT Investor Destinations Moderate Fund (the “Moderate Acquiring Fund”)
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Ladies and Gentlemen:
You have requested our opinion as to certain federal income tax consequences of the reorganizations (each hereinafter referred to as a “Reorganization”), which will consist of: (i) the acquisition by the Capital Appreciation Acquiring Fund and the Moderate Acquiring Fund (each an “Acquiring Fund”, together the “Acquiring Funds”) of substantially all of the property, assets and goodwill (“Assets”)
of the Capital Appreciation Target Fund and the Moderate Target Fund (each a “Target Fund”, together the “Target Funds”), respectively, in exchange solely for shares of beneficial interest, without par value, of the corresponding class of shares of
the Capital Appreciation Acquiring Fund and Moderate Acquiring Fund listed in Exhibit A below; (ii) the assumption by the Capital Appreciation Acquiring Fund and Moderate Acquiring Fund of all of the Capital Appreciation Target Fund’s and Moderate
Target Fund’s Liabilities, respectively; (iii) the distribution of each class of the Capital Appreciation Acquiring Fund’s and Moderate Acquiring Fund’s shares to the shareholders of its corresponding class of shares of the Capital
Philadelphia, PA • Harrisburg, PA • Malvern, PA • Cherry Hill, NJ • Wilmington, DE • Washington, DC • New York, NY • Chicago,
IL
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Appreciation Target Fund and Moderate Target Fund, respectively, according to their respective interests, in complete liquidation of the Capital Appreciation Target Fund and Moderate Target Fund; and
(iv) the liquidation and dissolution of the Target Funds as soon as practicable after the Closing, all upon and subject to the terms and conditions of the Plan. Capitalized terms not otherwise defined herein shall have the meanings assigned to them
in the Plan.
In rendering our opinion, we have reviewed and relied upon: (a) a copy of the executed Plan, dated as of August 10, 2020; (b) the Prospectus/Information Statement provided to
shareholders of the Target Funds dated July 31, 2020; (c) certain representations concerning the Reorganization made to us by the Acquiring Funds and the Target Funds in a letter dated October 26, 2020 (the “Representation Letter”); (d) all other
documents, financial and other reports and corporate minutes we deemed relevant or appropriate; and (e) such statutes, regulations, rulings and decisions as we deemed material in rendering this opinion.
For purposes of this opinion, we have assumed that each Target Fund on the Closing date of the Reorganization satisfies, and immediately following the Closing date of the
Reorganization, each Acquiring Fund will continue to satisfy, the requirements of Subchapter M of the Code, for qualification as regulated investment companies.
Based on the foregoing, and provided the Reorganization is carried out in accordance with the applicable laws of the State of Delaware, the terms of the Plan and
the statements in the Representation Letter for the Target Funds and the Acquiring Funds, it is our opinion that for federal income tax purposes:
1. The acquisition by an Acquiring Fund of substantially all of the assets of the corresponding Target Fund, as provided for in the Plan, in exchange solely for the Acquiring Fund
shares and the assumption by the corresponding Acquiring Fund of all of the Liabilities of the corresponding Target Fund followed by the distribution by the Target Fund to its shareholders of the Acquiring Fund shares in complete liquidation of the
Target Fund will qualify as a reorganization within the meaning of Section 368(a)(1)(C) of the Code, and each Target Fund and Acquiring Fund will be a “party to the reorganization” within the meaning of Section 368(b) of the Code.
2. No gain or loss will be recognized by the Target Fund upon the transfer of substantially all of its assets to, and the assumption of its Liabilities by, the corresponding Acquiring Fund in
exchange solely for the voting shares of the Acquiring Fund pursuant to Section 361(a) and Section 357(a) of the Code.
3. No gain or loss will be recognized by the Acquiring Fund upon the receipt by it of substantially all of the Assets of the corresponding Target Fund in exchange solely for the assumption of the
Liabilities and issuance of the Acquiring Fund shares pursuant to Section 1032(a) of the Code.
4. No gain or loss will be recognized by the Target Fund upon the distribution of the Acquiring Fund shares by the Target Fund to its shareholders in complete liquidation of the Target Fund pursuant to Section 361(c)(1) of the Code.
5. The tax basis of the Assets of the Target Fund received by the corresponding Acquiring Fund will be the same as the tax basis of these Assets in the hands of the Target Fund immediately prior to the Reorganization under Section 362(b) of the
Code.
6. The holding periods of the Assets of the Target Fund received by the corresponding Acquiring Fund will include the periods during which such Assets were held by the Target Fund under Section 1223(2) of the Code.
7. No gain or loss will be recognized by the shareholders of the Target Fund upon the exchange of their shares in the Target Fund solely for the shares (including fractional shares to which they may be entitled) of the corresponding Acquiring
Fund pursuant to Section 354(a) of the Code.
8. The aggregate tax basis of the Acquiring Fund shares to be received by each Target Fund shareholder (including fractional shares to which they may be entitled) will be the same as the aggregate tax basis of the shares of the Target Fund
exchanged therefor pursuant to Section 358(a)(1) of the Code.
9. The holding period of the Acquiring Fund shares received by each Target Fund shareholder (including fractional shares to which they may be entitled) will include the holding period of the Target Fund shares surrendered in exchange therefor,
provided that the shareholder held the Target Fund shares as a capital asset on the effective date of the Reorganization pursuant to Section 1223(1) of the Code.
10. The Acquiring Fund will succeed to and take into account as of the date of the transfer (as defined in Section 1.381(b)-1(b) of the Treasury Regulations) the items of the Target Fund described in Section 381(c) of the Code, subject to the
conditions and limitations specified in Sections 381, 382, 383 and 384 of the Code, if applicable, and the Treasury Regulations thereunder.
Notwithstanding anything to the contrary herein, we express no opinion as to the effect of the Reorganization on the Target Funds, the Acquiring Funds or any
shareholder of the Target Fund with respect to any asset (including, without limitation, any stock held in a passive foreign investment company as defined in Section 1297(a) of the Code or any contract described in Section 1256(b) of the Code) as to
which any unrealized gain or loss is required to be recognized for federal income tax purposes at the end of a taxable year (or on the termination or transfer thereof) under a xxxx-to-xxxx system of accounting or otherwise regardless of whether such
transfer would otherwise be a non-taxable transaction under the Code.
Our opinion is based upon the Code, the applicable Treasury Regulations, the present positions of the Internal Revenue Service (the “Service”) as are set forth in published revenue
rulings and revenue procedures, present administrative positions of the Service, and existing judicial decisions, all of which are subject to change either prospectively or retroactively. We do not undertake to make any continuing analysis of the
facts or relevant law following the date of the Reorganization.
Our opinion is conditioned upon the performance by the Acquiring Funds and the Target Funds of the undertakings in the Plan and the Representation Letter. Except as expressly set
forth above, we express no other opinion to any party as to the tax consequences, whether federal, state, local or foreign, with respect to (i) the Reorganization or any transaction related to or contemplated by such Reorganization (or incident
thereto) or (ii) the effect, if any, of the Reorganization on any other transaction and/or the effect, if any, of any such other transaction on the Reorganization.
We hereby consent to the use of this opinion as an exhibit to the registration statement of each Acquiring Fund on Form N-14, and any amendments thereto, covering the registration of
the Acquiring Fund Shares under the Securities Act of 1933, as amended, to be issued in the Reorganization.
Very truly yours,
/s/ Xxxxxxxx Ronon Xxxxxxx & Xxxxx, LLP [CCS]
Xxxxxxxx Ronon Xxxxxxx & Xxxxx, LLP
EXHIBIT A
NVIT DFA Capital Appreciation Fund
(the “Capital Appreciation Target Fund”)
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NVIT Investor Destinations Capital Appreciation Fund
(the “Capital Appreciation Acquiring Fund”)
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Class II
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Class II
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Class P
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Class P
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NVIT DFA Moderate Fund
(the “Moderate Target Fund”)
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NVIT Investor Destinations Moderate Fund
(the “Moderate Acquiring Fund”)
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Class II
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Class II
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Class P
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Class P
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